Aviva New Business Climbs 14 Percent, Helped by France, Turkey
Aviva Plc (AV/), the U.K.’s second-biggest insurer by market value, said the value of new business climbed 14 percent in the first nine months of the year, boosted by higher sales in Europe and Asia.
New business rose to 571 million pounds ($918 million pounds) from 503 million pounds in the nine months to Sept. 30. the London-based company said in a statement today. Business climbed 33 percent in France, 40 percent in Turkey and by 43 percent in Asia.
“Progress is in line with our expectations and we remain focused on delivering cash flow plus growth,” Chief Executive Officer Mark Wilson said in the statement. “Aviva remains in the early stages of turnaround.”
Wilson, who succeeded Andrew Moss this year, is seeking to appease investors by selling assets and cutting costs to help rebuild capital depleted by the financial crisis and shrink a 5.1 billion-pound internal loan. The size of the loan remained unchanged in the period. The insurer last month sold its U.S. unit to Apollo Global Management LLC for $2.6 billion, more than it initially expected.
Total long-term saving sales fell 6 percent to 5.81 billion pounds from 6.18 billion pounds in the year-earlier period. Net asset value a share fell to 273 pence at the end of the third quarter from 281 pence at the end of June.
The company said it’s making “satisfactory progress” on cost reduction, with operating expenses 10 percent below their level in 2011.
The combined ratio, or claims and expenses as a percentage of premiums, for the insurer’s property and casualty business was little changed at 96.9 percent in the nine-month period.
Aviva has climbed 19 percent in London trading this year, lagging the FTSE 350 Insurance Index’s 28 percent advance. Larger competitor Prudential Plc (PRU) has climbed 46 percent and Legal & General Group Plc, which yesterday reported a 20 percent increase in net cash for the first nine months, has advanced 45 percent.
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