During the first quarter of 2002, against the backdrop of a continuing weak economy, Fortis realised a net operating profit of EUR 831 million, an increase of 7%. This is the highest net operating profit ever achieved in one quarter (EUR 0.64 per share).
Other highlights include:
Â· a net operating profit of EUR 302 million in the insurance business, an increase of 5 %;
Â· a net operating profit of EUR 586 million in the banking business, an increase of 12%;
Â· a return on equity of 17.7% (year-on-year);
Â· an increase in net earnings per share of 5%.
Barring unforeseen circumstances, Fortis is expected to achieve its financial target for this year of an increase in net operating profit per share of at least 12%.
In the insurance business, the net operating profit totalled EUR 302 million, 5% higher than in the first quarter of 2001. Capital gains on investments were down from EUR 63 million after taxes in the first quarter of 2001 to EUR 52 million after taxes in the first three months of 2002. The profit growth in the insurance business may be attributed in part to the stabilisation of operating costs. The Non-life business and insurance activities in the United States performed particularly well.
Total gross premium income was 14% lower than in the first quarter of 2001. Sales of unit-linked insurances was slow, as in the previous quarters. In Life, gross premium income was down 37%, to EUR 2,418 million compared with the first quarter of 2001.
Half this decline may be attributed to one-off events, such as the loss of premium income resulting from the sale of Fortis Financial Group (from the second quarter of 2001) and the sale of Fortis Assurances (from the first quarter of 2002) as well as Fortis Bankâ€™s pension portability in the Netherlands in the first quarter of 2001. The other half of the decline in premium income may be explained primarily by the lower premium income from FB Insurance.
Compared to the fourth quarter of 2001 gross premium income rose by 9%. The technical result in Life increased by 29% compared with the first three months of 2001.
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