Related News:
Insurance Australia Full-Year Profit Halves After Claims at U.K. Unit Rise
Insurance Australia Group Ltd., the Sydney-based insurer formed in 1925, said fiscal-year profit halved after rising claims at its loss-making U.K. unit.
Net income in the year ended June 30 fell to A$91 million ($82 million) from A$181 million a year ago, Insurance Australia said in a statement today based on preliminary data. The company removed its top U.K. executive, Neil Utley, after he oversaw a A$367 million second-half charge at his division.
Insurance Australia fell the most in almost two months in Sydney trading as natural disaster claims also overran internal forecasts and the group set aside more funds to bolster reserves. The company has blamed rising personal injury claims among U.K. drivers and today replaced Utley with Ian Foy, head of the New Zealand unit.
“This year’s financial result does not reflect the expectations we held at the outset of the year,” Chief Executive Officer Mike Wilkins said in the statement. “I’m encouraged by the clear and ongoing improvement in the operational performance of our businesses in Australia and New Zealand.”
The stock dropped 4.3 percent to A$3.35, the biggest decline since June 2, at the 4:10 p.m. local time close. The shares have fallen 17 percent this year.
The insurance profit margin for the year was 7 percent, matching a reduced forecast announced in June. For the fiscal year ending June 2011, the margin will be between 10.5 percent and 12.5 percent, Insurance Australia said.
Full results will be released on Aug. 26.
To contact the reporter on this story: Angus Whitley in Sydney at awhitley1@bloomberg.net
Rate These Stories
Rate this Page