French insurance group AXA said today that its net profits rose 12% last year to a record €4.173 billion, and revealed that rioting in poor urban areas of France in November cost it €40m.
AXA's chairman Henri de Castries said that the group had shown 'strong growth momentum' in 2005. The performace was driven by personal financial services business in the fields of life insurance, savings plans and pensions, as well as in the area of asset management.
The figure was as analysts had expected. They had forecast a net profit of €3.53-4.2 billion.
At the end of January, AXA had reported that sales in 2005 had risen by 6.9% to €71.67 billion from €37.03 billion in 2004.
De Castries said that the group had 'not exhausted' its potential to do even better, adding that AXA had laid the way for future growth in 2005 by launching new business in India, Poland and Malaysia as well as making a series of acquisitions.
He said he was upbeat about the group's prospects but urged caution in case the insurance industry faced natural disasters such as the hurricanes and floods which hit the Americas and Europe last year.
He also said that the company was on course to achieve the goals it set in its 'Ambition 2012' plan, which aims double turnover and triple operating profit by that year, based on 2004 figures.
The president of AXA France, Francois Pierson, said that last year's rioting in the country's tense towerblock estates in urban outskirts had cost the company an estimated €40m. 'We were more affected than other companies because we were more exposed on risks to businesses while they were more exposed on risk to vehicles,' he said.
The French insurance industry federation has estimated that the rioting cost its members €200m, of which €30m arose from the burning of vehicles.
