Insurer Ageas beats H1 estimates, launches buyback lifting shares

The logo of Belgian insurance group Ageas is pictured at the company's headquarters in Brussels·Reuters
Dagmarah Mackos and Mathias de Rozario
2-min read
In this article:

By Dagmarah Mackos and Mathias de Rozario

(Reuters) - Insurer Ageas on Wednesday beat expectations for half-year net operating profit, after higher inflows into Asia and a recovery in Europe boosted its non-life and life products, and it launched a buyback programme, which lifted shares.

The stock was set for its best day in more than two years, gaining 5.7% by 0900 GMT.

Ageas' net operating profit for the first six months was 613 million euros ($683 million), ahead of a company-compiled consensus of analyst expectations for 575 million euros.

European rivals Generali, Allianz and ASR Nederland also beat first-half expectations.

The Belgium-based group said it will launch a 200-million-euro share buyback, citing a strong cash position and Solvency II ratio.

It will also pay out an interim gross dividend of 1.50 euros per share, it said.

The group's total inflows rose by 14% to 10.2 billion euros, including 5.01 billion euros from Asia. This was driven by strong sales of life insurance products and lower capital consumption in China following efforts to reduce risk in its equity portfolio that helped to offset higher taxes in the country.

Ageas, which operates through joint ventures in nine countries in Asia, has been looking to limit exposure to business with low cash flows that had concerned investors.

Asked about China Taiping Insurance's (CTIH) dividend policy, Ageas said its Chinese partner depends on Taiping's Life subsidiary for dividends to meet its goal, aligning both parties' interests in increasing cash flow.

Ageas' life insurance segment saw strong recovery in Europe, helped by new savings products in Portugal and growth across all businesses in Turkey.

The non-life insurance segment expanded across all European markets, with the UK experiencing the largest rise due to more customers and higher motor insurance premiums. Portugal also saw improvements from price adjustments in health care and motor products.

($1 = 0.8975 euros)

(Reporting by Dagmarah Mackos and Mathias de Rozario; Editing by Tom Hogue, Bernadette Baum and Barbara Lewis)