Finland’s biggest insurance group Sampo reported a doubling of fourth-quarter net profits to 302 million euros ($412 million), beating expectations and boosting full-year profits by 72 percent.
Full-year net profit for 2010 was 1.1 billion euros, compared to 641 million for 2009.
“We have a much lower volatility in our results than our peer group. The main reasons for this are size, scale and geographical diversification as well as focus on underwriting excellence,” group chief executive Kari Stadigh said in a statement.
Geographical diversification helped the group withstand the spike in regional costs incurred by severe weather in the past year, including “extreme winter, scorching summer riddled with storms and heavy downpours and in the fourth quarter weeks of premature but abundant snowfall,” the company said.
In addition, the annual results were boosted by a change in the status of Sampo’s 20.5-stake in Nordic banking giant Nordea.
At the beginning of 2010, Nordea’s status shifted from an equity investment to an associate company, immediately increasing Sampo’s reported profits.
Sampo’s quarterly result overshot the expectations of analysts polled by Dow Jones Newswires, who predicted that fourth-quarter net profit would be 276.3 million euros.
The group is optimistic about 2011, expecting a pickup in the global economy, an easing of the European debt crisis, and the continuing rise of short-term interest rates.
Sampo, which employs nearly 7,000 people, said its property and casualty insurance unit If P&C, along with its Mandatum Life “insurance operations are expected to report good and stable results and the contribution to profit of associated company Nordea Bank is anticipated to remain strong.”
If P&C and its subsidiaries serve the Nordic and Baltic regions as well as Russia.
Following the news, Sampo saw its share price inch up 0.22 percent to 22.27 euros in morning trading on a Helsinki stock exchange up 0.14 percent.
Helsinki, Feb 9, 2011 (AFP)
