Allianz AG said Friday its third-quarter net profit rose 70 percent despite this summer's costly hurricanes, on a better-than-expected profit from its insurance units and a decline in bad debt provisions.
The company earned euro794 million (US$933.9 million), or euro2.02 (US$2.38) a share, in the July-September period, compared with euro468 million, or euro1.27 a share, a year ago. Analysts polled by Dow Jones Newswires had predicted a profit of euro878 million (US$1.03 billion).
But the company said its results were hampered by its euro753 million (US$885.7 million) exposure to widespread flooding in Europe and Hurricanes Katrina, Rita and Wilma in the United States and Mexico.
The company's exposure to Wilma was likely to cut its fourth-quarter net profit by at least euro124 million (US$145.85 million), the company said.
Munich-based Allianz said both its insurance and banking operations were on track to meet full-year profit targets of euro4 billion (US$4.7 billion) and said its net profit growth in 2006 would be around 10 percent, up from 5 percent.
The insurer's pretax profit, used by most analysts and investors as a better measure of the company's health, rose 40 percent to euro1.6 billion (US$1.8 billion) from euro1.49 billion.
Net premiums were euro13.9 billion (US$16.4 billion), compared with euro13.8 billion, in line with analyst expectations of euro14 billion (US$16.5 billion).
"On a group level, we haven't yet determined any numbers," he said. "Currently, no number would have any substance." He did not specify if the company was planning to cut any positions at all.
Despite the loss from the storm exposure, Allianz's insurance operations were helped by improved results from its life and health insurance lines, as net income rose to euro376 million (US$442.3 million) from euro125 million a year ago, thanks to increases in Germany and France.
The net release of euro132 million (US$155.3 million) in loan-loss provisions was better than the euro26 million (US$30.6 million) forecast by analysts.
Allianz's banking operations - mainly Dresdner Bank AG - accounted for euro123 million (US$144.7 million) in net profit during the quarter, down from euro125 million last year and below the euro230 million (US$270.5 million) forecast by analysts.
The bank, which has 950 branches in 50 countries, posted lower profits because its higher fee and trading income, along with the release of a loan loss provision, could not help overcome higher administrative costs and reduced net interest income.
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