AIRLINK 62.48 Increased By ▲ 2.05 (3.39%)
BOP 5.36 Increased By ▲ 0.01 (0.19%)
CNERGY 4.58 Decreased By ▼ -0.02 (-0.43%)
DFML 15.50 Increased By ▲ 0.66 (4.45%)
DGKC 66.40 Increased By ▲ 1.60 (2.47%)
FCCL 17.59 Increased By ▲ 0.73 (4.33%)
FFBL 27.70 Increased By ▲ 2.95 (11.92%)
FFL 9.27 Increased By ▲ 0.21 (2.32%)
GGL 10.06 Increased By ▲ 0.10 (1%)
HBL 105.70 Increased By ▲ 1.49 (1.43%)
HUBC 122.30 Increased By ▲ 4.78 (4.07%)
HUMNL 6.60 Increased By ▲ 0.06 (0.92%)
KEL 4.50 Decreased By ▼ -0.05 (-1.1%)
KOSM 4.48 Decreased By ▼ -0.09 (-1.97%)
MLCF 36.20 Increased By ▲ 0.79 (2.23%)
OGDC 122.92 Increased By ▲ 0.53 (0.43%)
PAEL 23.00 Increased By ▲ 1.09 (4.97%)
PIAA 29.34 Increased By ▲ 2.05 (7.51%)
PIBTL 5.80 Decreased By ▼ -0.14 (-2.36%)
PPL 107.50 Increased By ▲ 0.13 (0.12%)
PRL 27.25 Increased By ▲ 0.74 (2.79%)
PTC 18.07 Increased By ▲ 1.97 (12.24%)
SEARL 53.00 Decreased By ▼ -0.63 (-1.17%)
SNGP 63.21 Increased By ▲ 2.01 (3.28%)
SSGC 10.80 Increased By ▲ 0.05 (0.47%)
TELE 9.20 Increased By ▲ 0.71 (8.36%)
TPLP 11.44 Increased By ▲ 0.86 (8.13%)
TRG 70.86 Increased By ▲ 0.95 (1.36%)
UNITY 23.62 Increased By ▲ 0.11 (0.47%)
WTL 1.28 No Change ▼ 0.00 (0%)
BR100 6,944 Increased By 65.8 (0.96%)
BR30 22,827 Increased By 258.6 (1.15%)
KSE100 67,142 Increased By 594.3 (0.89%)
KSE30 22,090 Increased By 175.1 (0.8%)

bizaCOPENHAGEN: Danish insurance company Topdanmark cut its full-year profit outlook on Tuesday after an investment loss and hefty claims from a freak rain storm knocked third-quarter results into the red.

The insurer cut its full-year net profit guidance to a range of 900 million to 1.0 billion Danish crowns ($183 million) from an earlier estimated 950 million to 1.05 billion crowns.

Topdanmark posted a third-quarter net loss of 53 million crowns against a profit of 318 million a year earlier and just smaller than the average forecast for a 58.9 million crowns loss in a Reuters poll of analysts.

The net investment return dropped to a loss of 139 million, crowns from a profit of 257 million a year earlier, compared with the average 200 million crowns loss forecast in the poll.

Investment returns would however improve in the fourth quarter from the third, Chief executive Christian Sagild said.

"Some of (the investment return) has recovered in the fourth quarter," Sagild told Reuters in a telephone interview, confirming that the fourth-quarter investment result would be better than the third quarter's negative return.

"We will not change our investment strategy. We still have exposure to stocks," Sagild said. The group said the storm that caused heavy flooding of basements and other property damage in July and a fire at a building in the country's capital insured by Topdanmark, had also weighed on results.

"The cloudburst on July 2 was truly extraordinary. it was a rare worst-case scenario," Sagild said in a statement. Shares in Denmark's second biggest insurance company by market value were up 1 percent by 1433 GMT, outperforming a 1.7 percent lower Stoxx 600 Europe insurance sector index and the Copenhagen bourse's benchmark index up 0.3 percent.

Analysts said while one-off events had hit third-quarter results, the underlying business had performed well. Topdanmark's insurance technical result the result from insurance activities before investment income rose to 188 million from 146 million in the same quarter last year, exceeding an average 141 million forecast.

"The insurance technical result was decent when one takes into account the cloudburst, and the investment result was weak as expected," said Jyske Bank in a note to clients.

In addition to the storm, Topdanmark had a claim from a fire at a Copenhagen sports and exhibition hall. The fire was expected to carry a cost of 25 million crowns, while the storm would cost about 115 million after re-insurance costs, the company said.

The combined ratio improved to 91.8 percent in the third quarter from 93.7 percent a year earlier and against an average 93.6 percent estimated by analysts.

Damages from the cloudburst and the fire alone would affect the combined ratio by 2.2 percentage points, Topdanmark said. The combined ratio measures costs and claims as a percentage of premiums and a figure below 100 means underwriting is profitable.

The insurer kept its forecast for 2011 premium growth of 1 to 2 percent in non-life insurance, and a combined ratio forecast of around 91-92 percent.

For 2012 Topdanmark said it expected premium growth also to be 1 to 2 percent and its combined ratio also around 91-92 percent in the non-life business.

Copyright Reuters, 2011

Comments

Comments are closed.