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Insurer AXA raises profit targets after buying XL
[PARIS] Insurer AXA expects profitability to speed up in the coming two years thanks to business brought in by XL, which it bought earlier this year, and added it hoped to boost dividends.
AXA, Europe's second-biggest insurer after Allianz , said it expected adjusted return on equity (ROE) to increase between 14-16 per cent annually over the coming two years, up from a previous target of between 12-14 per cent.
The French insurer also confirmed its target for underlying earnings per share to increase 3-7 per cent a year over the same period.
AXA expects profitability will be boosted by the diversification achieved from its US$15 billion acquisition of XL earlier this year. The company also raised its expected synergies on XL to 500 million euros(S$777.4 million) from 400 million before.
As a result, AXA will increase its dividend payout range to between 50-60 per cent from 45-55 per cent previously.
AXA shares were up 1.7 per cent in early session trading.