Allianz net profit up 21 percent to $2.7 billion

[August 07, 2009]  FRANKFURT (AP) -- German insurer Allianz SE said Friday its second quarter net profit rose 21 percent as its life and health insurance business improved and said it was adjusting to the "new normal" of reduced returns.

The Munich-based company said it made euro1.9 billion ($2.7 billion) in the April-June period, up from euro1.5 billion in the second quarter of 2008.

Revenues for the quarter were slightly higher at euro22.2 billion, compared with last year's euro21.5 billion.

Operating profit of euro1.8 billion during the quarter was 33 percent lower than the 2008 figure of euro2.7 billion. However, operating profit improved compared with this year's first quarter, when the company earned euro1.4 billion, and was double the figure for last year's fourth quarter.

"Overall, we achieved very good quarterly results," Michael Deikmann, the chief executive of Allianz said in the report.

"Allianz is prepared for what we perceive as 'the new normal,' an ongoing challenging market environment with structurally lower returns."

"We remain strongly capitalized and our low risk profile allows us to withstand potential market shocks," he said. "In addition, we are well diversified from both a regional and business unit point of view, and are thus able to benefit from market upturn."

Shares of Allianz were about 3 percent lower at euro73.45 in Frankfurt morning trading.

The company said its life and health segment saw operating profits improve nearly 41 percent to euro990 million in the second quarter on revenues that were 10 percent higher at euro12 billion.

However, Allianz's financial services segment saw its operating profit decline nearly 49 percent to euro146 million. Revenues at the unit were nearly level at euro926 million.

The property and casualty business saw its operating profit fall 47 percent to euro895 million, while revenues for the division, measured in gross written premiums, fell by 3 percent to euro9.5 billion.

Allianz said that division was especially affected by the Italian earthquake and severe weather in France during the first half of the year.

For the first six months, Allianz said its revenues rose nearly 3 percent to euro49.9 billion from last year's euro48.5 billion.

Net profit for the first half of the year was sharply lower, falling nearly 30 percent to euro1.9 billion from euro2.7 billion in 2008.

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http://www.allianz.com/

[Associated Press; By GEORGE FREY]

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