Ageas Profit Beats Estimates on Property Gains, Groupama Badwill

Ageas SA, the majority owner of Belgium’s biggest life insurer, reported profit that beat analysts’ estimates after selling properties in Belgium and buying Groupama’s U.K. business at a discount.

Net income in the three months through December rose to 224.6 million euros ($301.6 million) from a restated 26 million euros a year earlier, the Brussels-based insurer said today in a statement. Analysts projected profit of 185.1 million euros, according to the average of nine estimates compiled by Bloomberg. Ageas will raise its dividend by 50 percent to 1.20 euros a share.

The investment margin in the Belgian life business more than doubled to 1.28 percent in the fourth quarter, led by gains on real-estate disposals and lower reserves for profit sharing with clients in contracts with a guaranteed return. Ageas also recorded a 63 million-euro badwill gain from buying Groupama’s unit in the U.K. at a discount to net assets, as the insurer seeks to expand its property and casualty business to become less dependent on investment income.

“Our inflows and results in Life were particularly strong notwithstanding the low interest rate environment,” Chief Executive Officer Bart De Smet said in the statement.

The increase in gross inflows accelerated to 24 percent in the fourth quarter and advanced 16 percent in all of last year, led by a 28 percent gain in Asia, where Ageas has a fully owned subsidiary in Hong Kong and minority stakes in China, Malaysia, Thailand and India.

Ageas climbed as much as 4.7 percent in Brussels trading, the highest intraday value since April 2010, and traded 1.20 euros higher at 27.25 euros by 9:26 a.m. local time. The shares have gained 61 percent in the past 12 months, the best performance among the 33 companies in the Stoxx Insurance 600 Index.