Global insurer
Zurich failed to meet second-quarter profit expectations despite reporting growth, falling nearly $100 million short of analysts’ predictions.
The 6% increase reported by Zurich reflects a net profit increase from $789 million to $837 million for the second quarter, as compared to the year-earlier period. That brought net profit to a rise of 13.9% for the first half of 2014, to $2.11 billion.
Zurich said the operating profit of its general insurance business rose 20.7% in the first half, to $1.652 billion. Gross written premiums and policy fees, meanwhile, rose 11.4% to $19.995 billion.
Zurich’s general insurance business is the company’s largest.
However, the performance missed the $936 million mark expected by analysts.
A Wall Street Journal report attributes the miss to “one-off charges” that pushed the company to a higher effective tax rate. A 4% drop in operating profit from Zurich’s global life business also pushed growth down, with profits for the quarter ending at $634 million during the period.
Zurich Chief Executive Martin Senn was upbeat about the company’s performance, saying it had made “good progress” on the three-year restructuring plan that earlier cost Zurich some jobs and involvement in some businesses.
Zurich cut 670 jobs in the first quarter, which Senn said helped lower costs by $250 million annually. It also exited its general insurance business in Russia.
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