Insurer Aegon reports sharp fall in Q1 profit
Dutch company blames sharp fall on weak dollar and its worsening business conditions in the US.7 May 2008
AMSTERDAM - The Dutch insurance company Aegon NV reported a sharp fall in first-quarter profit on Tuesday, blaming the weak dollar and worsening business conditions in the US, where it owns Transamerica Corp.
Aegon says net profit was EUR 153 million, down from EUR 707 million a year ago. Revenues fell 12 percent to EUR 917 million.
The company said Tuesday that stripping out the effects of the weak US dollar and a decline in value of its investment portfolio, "underlying" earnings were up 9 percent.
By this measurement, US operations were flat while Dutch operations grew strongly.
On a standard reporting basis, the company's individual savings and retirement business was the worst performer, dropping to a EUR 58 million loss from a EUR 136 million profit last year.
The company also reported a EUR 39 million loss on investments, compared with a gain of EUR 283 million a year ago.
Chief executive Alexander Wynaendts praised the company's "underlying" performance, and noted Aegon had not been forced to take impairment charges on any large investments.
He added that credit conditions have improved since the end of the quarter, which "would have reduced significantly the negative impact" of investment valuations on the company's bottom line.
[AP / Expatica]