Aviva, Britain's second-largest insurer, reported a 10 per cent drop in half-year profit, blaming higher costs as it pushes through reorganisation aimed at improving its financial performance.
Aviva made an operating profit of £935m in the first six months of 2012, down from £1.035bn a year earlier, it said today. Analysts had expected a profit of £1bn, according to a company poll.
Aviva plans to sell or close more than a quarter of its businesses in a shake-up aimed at regaining the support of investors who in May forced out chief executive Andrew Moss in protest over the group's poor stock market performance.
The insurer, now led by executive chairman John McFarlane, also had to absorb £40m in flood-related claims during the first half after Britain was hit by torrential summer rain.
The company is paying an unchanged interim dividend of 10 pence per share.
Aviva shares closed at 318 pence on Wednesday, valuing the company at about £9bn
The stock has risen 6 per cent since the start of the year, lagging a 16 per cent increase in the Stoxx 600 European insurance share index,