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Ageas posts YOY fall in Q2 profit, but swings to H1 profit from year-ago loss

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Ageas posts YOY fall in Q2 profit, but swings to H1 profit from year-ago loss

Ageas SA/NV reported a 69% year-over-year decline in its second-quarter net result but swung to a first-half profit from a loss in the same period in 2016.

Second-quarter net result attributable to shareholders was €173.4 million, compared to €566.1 million in the same period in 2016. The general account business booked a net attributable loss of €48.9 million in the period, compared to a net attributable result of €159.1 million a year earlier. The life segment contributed €144.1 million in net result, down from €361.0 million a year earlier, while the nonlife division saw its net result slightly increase to €78.3 million from €46.0 million.

The group's net earned premiums declined on a yearly basis to €2.00 billion from €2.25 billion. Interest, dividend and other investment income stood at €719.7 million in the period, down from €763.7 million a year earlier.

The result on sales and revaluations dropped 95% year over year to €25.7 million from €475.0 million, while investment income related to unit-linked contracts rose on a yearly basis to €188.9 million from €74.3 million.

Net insurance claims and benefits totaled €1.78 billion in the second quarter, down from €2.15 billion a year earlier. Ageas also booked charges related to unit-linked contracts of €212.1 million in the period, expanding from the year-ago €79.7 million.

For the six months to June-end, the Belgian insurance firm reported a net attributable result of €283.6 million, swinging from an attributable loss of €67.2 million a year ago. EPS for the half was €1.39, compared to a loss per share of 32 cents a year ago.

The group combined ratio stood at 95.9% in the first half, improving from 99.0% a year ago. Ageas noted that the change in the U.K. personal discount rate, or Ogden rate, resulted in a residual negative impact of 5.3% on the U.K. combined ratio, which stood at 105.7% in the first half, compared to the year-ago 100.1%.

At June-end, the group's Solvency II ratio stood at 197.8%, compared to 191.2% at the end of December 2016. Based on the partial internal model, the Solvency II ratio was 184.0% at June-end, compared to 174.3% at 2016-end.

Ageas said it intends to launch a new €200 million share buyback program that will run from Aug. 21, 2017, to Aug. 3, 2018.

"In the past six years we have bought back an equivalent of 22% of the shares outstanding, which has led to a 28% increase of our earnings and dividends per share," CEO Bart De Smet said.