Scor Targets 7% Sales Growth as It Maintains Profitability Goal
Scor SE (SCR), expanding in the U.S. by buying Assicurazioni Generali SpA (G)’s life-reinsurance unit, said it’s targeting 7 percent annual revenue growth through 2016, excluding acquisitions, and maintained a profitability goal.
Scor’s total revenue will reach about 13.3 billion euros ($17.5 billion) in 2016 from a pro forma 10.9 billion euros this year, the Paris-based company said on its website today. Scor agreed in June to buy Generali USA Life Reassurance Co. for about 579 million euros to reach a leading 27 percent market share in the U.S. life-reinsurance industry. Scor expects to close the deal in the second half.
“We’ve got the capacity to keep developing” even if world’s growth “isn’t very fast,” Chief Executive Officer Denis Kessler said on a call with journalists. “We’re continuing with a strategy that has been a winning one.”
Scor kept a target for return on equity, a key measure of profitability, to exceed the risk-free three-month interest rate by 1,000 basis points, or 10 percentage points, the company said. The French reinsurer also aims for a solvency ratio of between 185 percent and 220 percent and plans to keep a “strong” dividend payout over the next three years, it said.
Scor fell 0.5 percent to 23.63 euros by 10:50 a.m. in Paris trading, giving the company a market value of about 4.55 billion euros. The shares rose 16 percent in 2013, while the 30-member Bloomberg Europe 500 Insurance Index gained 11 percent.
Reinsurers help insurers shoulder risk, earning premiums that they can invest to make a profit.
Scor will seek annual premium growth of about 8.5 percent at its property-and-casualty division through 2016 and anticipates prices globally will be “stable on average,” Kessler said. The company aims for 6 percent annual revenue growth at its life-reinsurance unit over the next three years, it said.
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