Aflac Inc.'s (AFL) third-quarter profit nearly quadrupled on
reduced investment losses and increased premiums.
Chairman and Chief Executive Officer Daniel P. Amos said, "I
continue to be encouraged by our financial and operating
performance so far this year, especially in light of the weak
economic conditions."
He noted Aflac remains cautious about the U.S. economy, saying
that U.S. premium growth won't rise 5% this year as planned.
Japan's growth target should be met.
The company reported earnings of $363 million, or 77 cents a
share, compared with $100 million, or 21 cents a share, a year
earlier. Operating earnings, which exclude investment gains and
losses, rose to $1.25 from $1.02. The company in July projected
$1.19 to $1.22, slightly above analysts' then-expectations.
Revenue rose 23% to $4.53 billion. Analysts polled by Thomson
Reuters recently projected $4.68 billion.
Premium income in yen grew 3.4% in the company's Japanese
operations, Aflac's biggest business. It grew 19% in dollars. U.S
premium income rose 3%.
Meanwhile, there remain concerns about Aflac's $8.3 billion in
perpetual-debenture exposure, which UBS earlier this month calling
it "still disconcerting." Aflac said in July it wouldn't record any
write-down under statutory accounting because it believes the
hybrid securities--which contain elements of equity and debt--will
continue to make payments.
Aflac recorded $212 million of write-downs on them in the third
quarter, again on a nonstatutory basis.
Shares closed Wednesday at $40.58 and were inactive after-hours.
The stock is down 11% this year.
-By Kevin Kingsbury; Dow Jones Newswires; 212-416-2354;
kevin.kingsbury@dowjones.com
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