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Ageas swings to Q4'17 profit from year-ago loss as UK biz recovers

Ageas SA/NV swung to fourth-quarter 2017 net profit attributable to shareholders of €263.5 million from a loss of €90.7 million for the same period in 2016, with CEO Bart De Smet saying that 2017 results were "the best" in the company's history.

The net attributable profit from insurance totaled €274.3 million for the period, with the life business contributing €149.7 million, up from the year-ago €81.1 million, and the nonlife division swinging to a net profit of €124.6 million from a year-ago loss of €163.2 million.

Net profit from Belgium amounted to €71.6 million in the period, down from the year-ago €81.5 million, while the U.K. business posted a net profit of €3.7 million, compared to the year-ago loss of €209.5 million. The company noted that its U.K. activities were still affected by the residual impact of the U.K. government's decision to revise the personal injury discount rate, or Ogden rate.

In continental Europe and Asia, net profits both increased year over year to €99.9 million from €30.1 million and €96.0 million from €16.5 million, respectively.

The group's net earned premiums rose on a yearly basis to €2.32 billion from €2.29 billion. Gross premium income declined year over year to €2.25 billion from €2.27 billion.

Net insurance claims and benefits totaled €2.08 billion in the quarter, down from €2.29 billion in the fourth quarter of 2016.

For full year 2017, Ageas reported a net attributable profit of €623.2 million, or 3.09 per share, compared to €27.1 million, or 13 cents per share, earned in 2016. The company said the 2017 results included a capital gain of €77 million related to the sale of its Italian nonlife business.

"We are very pleased to announce our 2017 results, the best in our history. A strong operating performance in Belgium, continental Europe and Asia, and progress made in the U.K., despite continuing impact from the Ogden rate changes, all contributed to our performance," De Smet said.

The fourth-quarter 2017 combined ratio was 96.2%, compared to the year-ago 113.2%, while full-year 2017 combined ratio improved year over year to 95.2% from 101.1%. A combined ratio above 100% indicates an underwriting loss.

Ageas' total group Solvency II ratio stood at 196.3% at the end of 2017, compared to 191.2% at the end of 2016. The total insurance Solvency II ratio improved on a yearly basis to 196.1% from 178.8%.

The company is proposing a regular dividend of €2.10 per share for 2017, up from €1.70 per share for 2016 and representing a payout ratio of 42% of the net insurance result.