PARIS, August 1 – AXA insurance turned in a surprisingly strong first half profit on Friday, with a record operating performance, and raised its targets for cost cutting.
The French group with international spread said net profit jumped by 22.0 percent from the figure at the same time last year to 3.0 billion euros ($4.0 billion).
It said it was now aiming to cut costs between 2011 and 2015 by 1.9 billion euros, an increase in its ambitions of 200 million euros.
Analysts had broadly expected a net figure of 2.7 billion euros.
The outcome was achieved despite a 1.0 percent fall in sales to 49.7 billion euros owing to unfavourable exchange rates, notably in Japan. On a basis of steady exchange rates, sales rose by 2.0 percent.
The group ramped up its operating profit by 8.0 percent to a record 2.8 billion euros.
“This is an excellent first half for AXA during which we have achieved both profitability and growth,” finance director Gerald Harlin told a telephone press conference.
The group said that the overall performance was in line with the targets set by its strategic plan which aims up to 2015 to turn in annual growth of operating profit of 5.0-10.0 percent, and a return on equity or shareholders’ funds of 13.0-15.0 percent. In the last six months this ratio was 16.8 percent.
The group said it had reduced costs by 1.3 billion euros since 2011 and was now aiming for 1.9 billion euros of savings.
Shares in AXA were up 1.98 to 17.53 euros in initial trading. The overall French market as measured by the CAC 40 index was down 0.90 percent.