Polish Insurer PZU Posts 48% Profit Decline in 1Q

By Martin Sobczyk

WARSAW--Polish insurer PZU SA (PZU.WA) said Thursday its first-quarter net profit fell 48% in annual terms on lower stock-market valuations of its assets, while the core insurance business remained stable.

The company made 486.6 million zlotys ($125.6 million) in first-quarter net profit, with its gross written premiums up 2.5% from the year earlier to PLN4.8 billion, and insurance claims marginally higher at around PLN3.07 billion.

Overhead costs rose almost 52% with the consolidated result now showing Alior Bank SA, in which PZU holds a 29.22% stake that it has bought since the second quarter of 2015.

PZU, like most Polish stocks, has been under strong pressure and has shed about a quarter of its value over the past year. Poland's previous government cut inflows of taxpayers' money into privately managed pensions funds, which reduced demand for stocks, and political risk weighed during the transition of power from a centrist to a socially conservative government last year.

PZU closed 0.3% higher on the day on Wednesday compared with the blue-chip WIG20 closing 0.39% lower.

Write to Martin Sobczyk at martin.sobczyk@wsj.com

(END) Dow Jones Newswires

May 12, 2016 03:26 ET (07:26 GMT)

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