ACE raises profit forecast despite higher crop insurance claims
* Q3 oper EPS $2.01 vs est $1.84
* Q3 net premiums earned up 4 percent
* Q3 combined ratio 92.0 percent
* Sees full-year oper EPS $7.73-$8.03 vs est $7.91
Oct 23 (Reuters) - Property and casualty insurer ACE Ltd raised its full-year operating profit outlook as lower catastrophe losses and growth in premium revenue helped offset higher claims at its U.S. crop insurance segment for the second successive quarter.
The company raised its full-year operating profit forecast to between $7.73 and $8.03 per share, up from its prior range of between $7.20 and $7.60 per share.
Analysts are expecting the company to earn $7.91 per share for the full year, according to Thomson Reuters I/B/E/S.
"We continue to benefit from the favorable P&C (property and casualty) pricing trend in North America, where we recorded strong double-digit premium growth," Chief Executive Evan Greenberg said in a statement.
ACE has been diversifying its business and has boosted its presence in emerging markets, especially in Mexico, through the past quarter. It announced plans last week to buy Ally Financial's Mexican insurance business for $865 million.
It also bought Mexican surety company Fianzas Monterrey from New York Life Insurance Company for about $285 million in September.
The company recorded higher claims from its crop insurance segment for the second quarter in a row as the fallout from the U.S. Midwest's worst drought in more than 50 years continues.
In the quarter, ACE recorded a $97 million crop insurance loss, net of tax, compared with an income of $54 million, last year.
Ace's Rain and Hail division and rival Everest Re's Heartland Crop Insurance are the dominant players in the U.S. crop insurance market.
The Zurich-based company posted third-quarter net income of $640 million, or $1.86 per share, compared with a loss of $39 million, or 11 cents per share, a year earlier.
On an operating basis, the company earned $2.01 per share, above analyst expectations of $1.84 per share.
Net premiums earned in the quarter rose 4 percent to $4.67 billion.
Property & Casualty combined ratio, the percentage of premium revenue an insurer has to pay out in claims, was 92 percent in the quarter.
Shares of the company, which has a market capitalization of $27.30 billion, have risen 12 percent in the last three months. They closed at $80.25 on Tuesday on the New York Stock Exchange.
- Malaysia Airlines denies crash report, says plane still missing |
- UPDATE 4-Malaysia Airlines plane crashes in South China Sea with 239 people aboard - report
- China draws red line' on North Korea, says won't allow war on peninsula
- No signal picked up from missing Malaysia Airlines plane-Vietnam official
- Malaysian plane crashed off Vietnam coast: state media