AXA result steady in tough markets

AXA Asia Pacific has managed to hold ground in difficult markets, reporting only a marginal reduction in net profit on the back of a modest increase in operating earnings.

The company told the Australian Securities Exchange today that profit after tax and before investment experience and non-recurring items was down 1 per cent to $596.8 million while operating earnings for the 12 months ended December 31 last year were up 2 per cent to $555.6 million.

AXA Asia Pacific said its Australia operating earnings were up 1 per cent to $235.3 million, largely driven by a 31 per cent increase in financial protection new business and its capital protected product — North.

The company said that wealth management earnings in Australia were down 27 per cent to $60.7 million, while financial protection was up 52 per cent to $104.6 million.

Commenting on the result, AXA Asia Pacific chief executive Andrew Penn described it as a solid operating performance but acknowledged that the bottom line had clearly been affected by negative investment earnings.

Looking over the horizon, Penn predicted a challenging 2009, saying customers were clearly focused on protection and security.

“There [has been] a significant reduction in demand for wealth management products and a bias towards more defensive asset classes, more traditional products and more insurance protection,” he said.