AXA income up 50pc due to disposals
AXA, Europe’s second-biggest insurer, yesterday announced that full-year 2011 net income rose by 49 per cent, mainly due to asset sales.
Earnings rose to €4.32bn (£3.58bn) last year, assisted by €2.3bn of income from the sale of its stake in Chinese insurer Taikang Life and other disposals in Canada, Australia and New Zealand.
Total revenue shrunk slightly from €89.4bn to €86.1bn
However, profits failed to meet expectations after the firm made a €943m goodwill reduction related to the impact of falling long-term US interest rates on its portfolio of annuities.
“It wasn’t expected by the market, but for us it was a prudent move. I would remind you that we’re talking about a goodwill write-down on a US unit which is a small part of our overall operations,” AXA chief financial officer Gerald Harlin said.
AXA’s bottom line was hit by €281m of restructuring costs and write-downs reflecting expectations it will have to take a 78 per cent haircut on Greek debt holdings.