Dutch insurer Aegon has improved its income in the first three months of 2005 by 5% over the same period for the previous year. However, the added profits came from investment gains and asset sales and not from core business.
Net profits were E666 million compared to E633 million in Q1 2004, an increase of 5% and significantly above industry expectations. However, profit of E292 million from investments, an increase of E102 million over the previous year, and income from the sale of a number of assets, most recently its general insurance businesses in Spain, were the real drivers of Aegon’s positive results.
Despite pointing to healthy growth in its life insurance business in the Netherlands, US and Taiwan, the company’s sales fell to E9.61 billion from E10.1 billion in the quarter.
In the US, which continues to be Aegon’s most important market, net profit fell 12% to E329.5 million. The Dutch insurer said the drop was due to new accounting rules. Meanwhile, earnings in its home market were down, but on a more positive note, earnings from its UK business were significantly higher.