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Zurich Financial reports 'solid' earnings after crisis
Released on - Thursday,05 November , 2009 -13:09 11
Swiss insurance group Zurich Financial Services said Thursday its net profit had declined by 24 percent in the first nine months of the year despite a sharp revival in its third quarter fortunes.
Nine month net profit reached 2.2 billion dollars (1.5 billion euros), after third quarter net income soared to 909 million dollars, a near six-fold increase year-on-year, the company said in a statement.
Zurich described its results as "solid" after the fourth consecutive quarterly improvement since its profits slumped a year ago with the collapse in financial markets.
However, it missed forecasts by analysts polled by business news agency AWP who expected an average 2.5 billion dollars in net profits over nine months.
Zurich's share price on the Swiss Market Index dropped by 4.1 percent in morning trading (0930 GMT) to 227.80 Swiss francs amid disappointment over its profits.
Operating profit for what the company described as a "discrete third quarter" grew 138 percent year-on-year to 1.5 billion dollars, boosting nine month operating profit to 4.1 billion dollars, just three percent down.
Chief financial officer Dieter Wemmer said in a conference call that the group had recorded good growth in several sectors.
The results were also buoyed by the lack of seasonal hurricane damage in the United States or other major catastrophes, he added.
Chief executive James Schiro underlined Zurich's attempts to deliver "sustained profitable growth" through a "period of ongoing economic uncertainty."
Gross life insurance premiums grew by 16 percent to 17.4 billion dollars in the nine month period, partly through acquisitions in Spain, while the US Farmers insurance branch boosted revenues by eight percent to 1.97 billion dollars.
The group also recorded the greater part of its improved nine month investment results in the third quarter as financial markets surged.
Analysts at private bank Wegelin said question marks over the nine month decline in net profits would increase uncertainty among investors despite other positive results in its balance sheet.