Net income fell to 4.15 billion euros ($5.5 billion) from 4.19 billion euros in 2011, the Paris-based insurer said in a statement today. That missed the 4.47 billion-euro average estimate of 20 analysts surveyed by Bloomberg. Revenue increased 5 percent to 90.1 billion euros.
Axa, led by Chief Executive Officer Henri de Castries, is expanding in Asia and has shifted 6 billion euros of capital to faster-growing markets since 2010. Annual operating profit, which excludes capital gains, one-time charges and variations in asset valuations, rose 13 percent to 4.25 billion euros, above analysts’ estimates, driven by earnings from life and savings.
“Life insurance is globally good,” said Benoit Valleaux, a Paris-based analyst at Natixis SA who has a buy rating on the stock. “The group is reinforcing its financial solidity, and that’s good too.”
Axa plans a dividend of 72 cents a share for 2012, up from 69 cents a year earlier. The stock fell 1.5 percent to 13.50 euros by 9:07 a.m. in Paris trading, trimming the gain this year to 1.1 percent. The 28-member Bloomberg Europe 500 Insurance Index advanced 3.5 percent this year.
Allianz SE (ALV), based in Munich, reported a more than doubling in fourth-quarter net income today to 1.22 billion euros on reduced claims from natural disasters. Allianz said it sees 2013 operating profit at 9.2 billion euros, plus or minus 500 million euros, after posting full-year operating profit of 9.5 billion euros last year, meeting its goal of more than 9 billion euros.
At Axa, operating profit from property and casualty insurance rose 3 percent to 1.9 billion euros, while profit from the life-and-savings business, its biggest division, rose 23 percent to 2.64 billion euros, beating analysts’ 2.54 billion- euro estimate.
“Their life business is resisting” difficult market conditions, Jacques-Pascal Porta, who helps manage 600 million euros at Ofi Gestion Privee in Paris, including Axa shares, said before the results were published. “You also see the first fruits of their quite important push in Asia and especially Hong Kong.”
The company increased its planned cost reductions by 200 million euros to 1.7 billion euros by 2015.
“We have continued to relentlessly pursue efficiencies and product innovations, as well as benefit from sweet spots in high-growth markets,” de Castries, 58, said in the statement.
Deputy CEO Denis Duverne said in an interview with Mark Baron on Bloomberg Television’s Countdown show that he expects P&C earnings will improve further in 2013 and that the company’s life business is “well positioned.” He said the company should be able to meet its targets for 2015.
Adjusted return on equity, a measure of profitability, reached 13.3 percent last year, bringing it into line with a goal of 13 percent to 15 percent in 2015.
In November, Axa lowered its earnings targets through 2015 as “unfavorable” financial markets weighed on its life- insurance and asset-management units. Axa said on Nov. 7 it expects operating earnings per share to grow 5 percent to 10 percent annually until 2015, compared with a previous target of 10 percent.
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