PARIS: French insurer AXA dropped its 2020 earnings target and added it would not make additional payouts to shareholders in the fourth quarter following a 40% decline in first-half net income.
AXA, the second-largest European insurer after Allianz, said net profit fell to 1.43 billion euros ($1.70 billion) from 2.33 billion during the same period a year ago. Overall revenues fell by 10% to 52.4 billion euros.
Underlying earnings at the property and casualty business were down 72% to 544 million euros, in large part due to COVID-19-related claims stemming from business interruption contracts and event cancellations.
"In the context of the material estimated impact from Covid-19 on underlying earnings in 2020, AXA's management has withdrawn its Ambition 2020 underlying earnings per share and adjusted return on equity targets," the insurer said.
AXA said its board of directors decided it would not propose an exceptional distribution of reserves to shareholders in the fourth quarter, following a number of discussions with regulators.
AXA said earlier this year it could consider proposing an additional fourth-quarter payout of up to 0.70 euro per share if financial market conditions improved. - Reuters
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