Axa unveils plans to slash debt

AXA, Europe's second-largest insurer, said it would boost earnings and cut debt as part of a 2015 plan to bolster investor confidence in its future growth path.

The company is under pressure to deliver a convincing strategy after the crisis forced it to shelve its previous growth targets.

Its shares have rebounded this year but are still trading at among the sector's lowest price-to-book multiples.

The insurer is targeting an underlying earnings-per-share growth rate of 10 per cent by 2015 on a compound annual growth basis, the French group said ahead of an investor day.

The insurer also announced the sale of its Canadian operations to Intact Financial Corp for C$2.6bn(£1.62bn) in cash.

AXA has grown over the past three decades from a small mutual insurer in Normandy to a global player via a string of acquisitions.

Its current chief executive, Henri de Castries, is facing growing questions about the company's push into emerging markets and anaemic share price performance.

The group reiterated its aim to find 1.5 billion euros (1.31 billion pounds) in pre-tax cost savings by 2015, which it said would come from mature markets. By 2013 the group said it will have reached 800 million euros in pre-tax savings.

The group is targeting an adjusted return on equity of 15 percent in 2015 and a debt gearing level of 25 percent, down from 28 percent at end 2010.

In asset management, a trouble spot for the group, AXA is targeting a turnaround of net flows in 2011 and then four to five per cent net new money flows per year between 2012 and 2015.