Hannover Re raised its 2009 earnings targets after third-quarter results beat expectations thanks to low damage claims and revitalised investment income, sending its shares up more than 3 percent.
The world’s fourth-biggest reinsurer’s repeated predictions of strong growth in its property-casualty and life and health reinsurance business have boosted the share price by more than 40 percent so far this year.
The company said it expected to post “a very good result” for 2009, and raised its outlook to an after-tax return on equity of above 20% from the previous goal of at least 18%, and earnings-per-share of at least €5.75 ($8.55) compared with the previous target of €5.
Net profit was €159.4 million in the third quarter compared with a net loss of €395 million a year earlier. Gross premium income rose 23% to €2.42 billion from €1.96 billion, boosted by the contribution of the U.S. individual-life-reinsurance portfolio that Hannover Re bought from Bermuda-based reinsurer Scottish Re Group Ltd. in the first quarter.
Hannover Re, has now posted net profit in three consecutive quarters as the financial crisis has eased.
Chief Executive Ulrich Wallin said: “With our result for the third quarter, we have secured a very good foundation and are in a position to raise our profit target for the full financial year,”
Hannover Re also said it aims to pay a dividend of at least €2 a share. Around this time last year, Hannover Re warned on full-year profit and said it would omit a dividend for 2008, because of a higher-than-budgeted hurricane bill and hefty write-downs related to the financial crisis.
