Life Insurance

Axa Posts 2nd-Half Profit on Life-Insurance Business (Update3)

(Bloomberg) — Axa SA, Europe’s second-biggest insurer, posted a second-half profit after a rally in financial markets boosted demand for policies linked to stock performance.

Net income reached 2.28 billion euros ($3.1 billion) from a 1.24 billion-euro loss a year earlier, according to figures on the Paris-based company’s Web site today. That exceeded the 1.62 billion-euro estimate of analysts surveyed by Bloomberg.

Axa, like MetLife Inc., the U.S.’s biggest insurer, returned to profit after equity markets rebounded following the worst financial crisis since the Great Depression. Chief Executive Officer Henri de Castries, 55, is relying on the company’s life and savings division, whose earnings exceeded analysts’ estimates in the quarter, to recapture growth.

“The results demonstrate that Axa’s life-dominated business model positions the group well in an economic recovery,” said Ralph Hebgen, an analyst at Keefe, Bruyette & Woods Ltd., in a note to investors. He has an “outperform” rating on the stock.

Axa rose 0.5 percent to 15.64 euros at 12:22 p.m. in Paris trading. It has gained 43 percent in the last 12 months, giving the insurer a market value of 35.7 billion euros. The 29-member Bloomberg Europe 500 Insurance Index has climbed 39 percent.

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