Enter multiple symbols separated by commas

Axa's 2006 Profit Beats Predictions, Rising 18%

French insurance giant AXA said Thursday that improving sales in its life insurance and asset management businesses helped lift 2006 profit 18%.

Beating analysts' predictions, AXA's net income rose to 5.09 billion euros ($6.69 billion) last year from 4.32 billion euros in 2005. A Dow Jones Newswires poll gave an average net profit forecast of 4.89 billion euros ($6.43 billion).

AXA, France's biggest insurance company by market capitalization, said underlying earnings -- which exclude capital gains and are considered a key measure of insurance company profitability -- were up 20% percent at 4.01 billion euros.

Life and savings products were the main contributor to underlying earnings, rising 20% to 2.33 billion euros ($3.06 billion) from 1.93 billion euros the year before.

Sales of life and savings products were strongest in Britain. The United States saw strong sales growth of variable annuities and life insurance contracts, while French life and savings also posted strong sales growth, the company said.

In addition, life and savings sales enjoyed a boost at all insurance companies operating in France because of taxation changes on home purchase savings plans, known in France as PELs.

In June, AXA agreed to buy the Winterthur insurance company from Credit Suisse Group for 7.9 billion (US$10.38 billion) in cash, giving it a major presence in Switzerland and bolstering its activities elsewhere in Europe and emerging markets.

AXA said Thursday that it aims to generate 350 million euros ($460.08 million) in savings from the deal by 2010, up from the 280 million euros ($368.06 million) forecast when the acquisition was announced. The company said in a statement that it will recommend a 2006 dividend of 1.06 euros, up 20% from the previous year.

AXA didn't give a breakdown of second-half earnings.

Contact U.S. News


    Get the best of CNBC in your inbox

    Please choose a subscription

    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

U.S. Video

  • Whole Foods down sharply

    Shares of Whole Foods are down 11 percent after quarterly earnings. Meredith Adler, Barclays analyst, cut her price target to $35 per share on the stock.

  • Q2 GDP by the numbers

    A new look at growth, with CNBC's Steve Liesman. First quarter GDP was revised to higher to 0.6 percent.

  • CNBC update: Tom Brady appeal

    A lawsuit seeks to overturn Tom Brady's 4 game suspension, and debris from an aircraft will be sent to France for investigation into whether it was part of the Malaysia flight MH370 that vanished, reports CNBC's Sue Herera.