Hannover Re Quarterly Profit Beats Estimates
Hannover Re, the world’s third- biggest reinsurer, said second-quarter profit climbed 4.1 percent, exceeding analyst estimates.
Net income rose to 166.2 million euros ($238 million) from 159.6 million euros in the year-earlier period, the Hanover, Germany-based company said in a statement today. That beat the 151 million-euro average estimate of eight analysts surveyed by Bloomberg.
Hannover Re, led by Chief Executive Officer Ulrich Wallin, reduced its full-year profit target by 23 percent to 500 million euros in May following claims from the earthquake and tsunami in Japan. The reinsurer reiterated that forecast today.
“Our group net income of 218 million euros for the first half year should enable us, given a normal experience in the second half of the year, to comfortably attain our targeted year-end profit,” Wallin said in the statement.
Natural disasters cost insurers and reinsurers about $70 billion in the first six months of this year, according to estimates by Guy Carpenter & Co., the reinsurance brokerage of Marsh & McLennan Cos.
Swiss Re Ltd. and Munich Re, the world’s biggest reinsurers, last week said they expect reinsurance rates to rise after posting second-quarter earnings that exceeded analyst estimates. Zurich-based Swiss Re reported an 18 percent increase in net income to $960 million, while larger rival Munich Re posted a 3.8 percent rise in profit to 736 million euros.
Reinsurers sell coverage to primary insurers such as Allianz SE and Axa SA (CS) to help guard them against the cost of major claims. Hannover Re is 50.2 percent owned by German insurer Talanx AG.
Hannover Re shares dropped 20 percent this year, giving the company a market value of about 3.9 billion euros. The Bloomberg Europe 500 Insurance Index dropped 13 percent this year, while Munich Re lost 18 percent and Swiss Re 16 percent.
Hannover Re said in a separate statement today that Claude Chevre will join its management board by Feb. 1, 2012, at the latest. Chevre, 44, will succeed Wolf Becke, who retires on Jan. 1, and will assume responsibility for the life and health reinsurance business together with board member Klaus Miller. Chevre was previously head of life for Asian markets, Spain, Portugal and Latin America at PartnerRe Ltd., Hannover Re said.
To contact the reporter on this story: Oliver Suess in Munich Bureau at email@example.com