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REPORTING SEASON: Insurance Australia Group (IAG)

Brought to you by CommSec

 

Figure 1: Insurance Australia Group 12 month chart

 

Insurance Australia Group (IAG) has more than tripled its annual profit and more than doubled its final dividend.

Fewer natural disasters helped lift IAG’s reported NPAT to $776M. A less volatile measure of performance, insurance earnings, increased by 69% to $1.4B. Revenue from premiums (GWP) increased by 11.8% to $9.5B.

Today’s result came in at the upper end of guidance. The insurer gave a positive outlook last month after claims for natural disasters came in below forecast.

The company, which makes around a fifth of its revenue in New Zealand, also benefited from the rise in the NZ dollar.

IAG has delivered a solid FY14 guidance with GWP growth guidance of 5-7%.

It has forecast a natural perils allowance of between $620-640M. Shareholders will receive an increased final dividend of 25 cents per share, to be paid on the 9th October.

It brings total dividend payments for the year to 36cps, up from FY12’s payments of 17cps. IAG shares rose in early trade before falling into the red.

They are up more than 20% so far this calendar year.

 

You can see all of CommSec’s reporting season analysis by clicking here.

Juliette Saly, Market Analyst,