Aviva H1 Profit Declines, Lifts Dividend; Backs Operating Profit View

(RTTNews) - British life and health insurer Aviva Plc (AV.L, AV) reported Thursday that its first-half IFRS profit after tax fell 63 percent to 201 million pounds from 545 million pounds last year.

Earnings per share were 2.5 pence, down 80 percent from 12.8 pence a year ago.

The results were adversely impacted by non-cash market variances as at 30 June 2016, including the revaluation of Euro-denominated and other debt obligations at a lower exchange rate.

Operating profit increased 13% to 1.325 billion pounds from 1.170 billion pounds last year, despite higher weather claims in general insurance, lower bulk purchase annuity sales in UK Life and new government levies.

Operating earnings per share went up 1 percent to 22.4 pence from 22.1 pence last year. General insurance net written premiums grew 7% to 3.99 billion pounds.

Life insurance value of new business went up 7% to 583 million pounds.

Further, the company announced interim dividend per share of 7.42p, up 10 percent from 6.75p last year.

The company said it remains on track to deliver on the plan outlined at recent investor day to increase the dividend payout ratio to 50% of operating EPS by the end of 2017, up from 42% in 2015.

Looking ahead, the company said that while uncertainty in the economic outlook may persist in the short term, it has not observed major disruption to operating activities and it continues to target mid-single digit growth in operating profit over the medium term.