Axa UK earnings fall 19%
Thursday 19th February 2009, 11:26AM GMT.
Insurer Axa UK said a 19 per cent fall in earnings for 2008 was a “resilient result” in challenging markets.
In the UK and Ireland, underlying earnings decreased by 19 per cent from £354 million in 2007 to £288 million in 2008, although this was a smaller decline than analysts were expecting.
Group chief executive, Nicolas Moreau, said: “The current crisis has demonstrated that Axa UK’s business model is sound and that we are financially strong. Our asset portfolio and solvency margin remain robust in today’s weakened financial environment.”
Improved performance from the firm’s healthcare division, where revenues increased eight per cent from £993 million in 2007 to £1,070 million in 2008, were offset by sharp profit falls in Axa’s life and savings business.
“Life earnings were impacted adversely by the falling stock market which had a direct impact on annual management charges,” Axa said, adding this, combined with increased investment costs, led to a 44 per cent fall in underlying earnings for the life and savings unit.
Insurance companies have faced falling returns from equities since the credit crunch began. Earlier this week, rival Legal & General more than doubled its credit reserves.
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