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COPENHAGEN, Jan 30 (Reuters) - Denmark’s Tryg, the Nordic region’s second-biggest general insurer, posted fourth-quarter earnings well above expectations on Thursday and maintained its financial targets despite high storm claims.
Pretax profit was steady at 639 million Danish crowns ($116.84 million) for the last three months of 2013, 33 percent above the concensus forecast of 425 million in a Reuters poll of analysts.
Tryg said its targets for 2014 remains delivering a combined ratio - a measure of an insurer’s profitability - of 90 or below and return on equity of 20 percent after tax. The lower the combined ratio, the more profitable the company is.
“I‘m tempted to call it impressive that they can report a combined ratio below 90 in a quarter with two expensive storms,” Sydbank analyst Jacob Pedersen said.
The results were achieved despite a generally higher level of weather claims in 2013, with two windstorms hitting Denmark in the fourth-quarter and more than 45,000 claims processed.
“It was especially efficiency improvements, savings and better procurement that created the satisfactory results,” chief executive Morten Hübbe said in a statement.
Total weather claims expenses amounted to 875 million crowns, but since Tryg has a reinsurance agreement, the impact on profit was only 620 million crowns, which also includes expenses for repurchase of a reinsurance agreement.
The company proposed a 27 crown per share dividend, a touch above the 26 crowns a year earlier. The company has also initiated a 1 billion crown share buyback programme, which is expected to be finalised at the end of 2014. ($1 = 5.4691 Danish crowns) (Reporting by Ole Mikkelsen; Editing by David Goodman)