AXA looks to India, Southeast Asia for future
AXA looks to India, Southeast Asia for future
Agence France-Presse, Sydney
Insurance group AXA Asia Pacific said on Monday that it would soon enter the Indian market and expected accelerating growth elsewhere in Asia as it reported strong profit growth for the six months to June.
AXA Asia Pacific, which is 51 percent owned by French insurance giant AXA, said it had achieved a 36 percent rise in net profit before one-off items to A$246.4 million (US$184.8 million) from a year earlier.
The result was ahead of market forecasts centered on A$210 million.
Operating earnings, the key indicator of the underlying performance of the business, grew 18 percent to A$185.8 million, it said.
The company said it expected to spend between A$35 million and A$65 million over the next three years in India, the fifth largest life insurance market in Asia.
This follows on the announcement last week that AXA Asia planned to enter the Malaysia market by acquiring the life business of Tahan Insurance Malaysia in a joint venture with Affin Holdings.
"We have recently announced our entry into Malaysia and we are well advanced with our plans to enter India," chief executive Les Owen said.
AXA chief financial officer Geoff Roberts said negotiations on moving into India were nearing conclusion.
"We're well advanced in discussions with a very small number of joint venture partners," he said. "Watch this space over the next couple of months."
Owen said that the momentum in the core markets of Australia and New Zealand was encouraging.
"The encouraging trend that started in the fourth quarter of last year has continued this year," he said.
The group's expansion in Asia follows a failed takeover attempt of AXA Asia Pacific by the company's French parent, which felt Asian investments were being hindered by constraints linked to its Australian listing.
Operating earnings in Australia and New Zealand meanwhile grew 32 percent to A$99.8 million from the previous first half, the company said.
Group assets under management rose nine percent to A$66.7 billion at the end of the first half from A$61.2 billion on Dec. 31.
AXA Asia Pacific's position in Asia also offers exceptional growth prospects over the next few years, Owens said.
"Our strong capital and financial position means we are able to pursue growth opportunities where we see value," he said.
The Hong Kong life market remains particularly attractive with the retirement savings market expected to more than double over the next five years, while the company also hopes to expand in the broker market, he said.
Operating earnings in Hong Kong grew 10 percent in local currency, driven by continued profitable sales growth, while in China and southeast Asia, the value of new business grew 18 percent to A$31.8 million.
The company reported its results Monday under Australian International Financial Reporting Standards (AIFRS) for the first time, restating comparative results for the previous year under the new standards.
The adoption of AIFRS means the previous first half profit was reduced to A$64.4 million after one-off items with a booked loss of A$117.1 million.