New Generali CEO says will stick to existing strategyReprints
(Reuters) — New Assicurazioni Generali S.p.A. Chief Executive Philippe Donnet said he would stick to his predecessor's strategy after writedowns on BTG Pactual and other equity holdings pushed the Italian insurer's fourth-quarter earnings below forecasts.
The earnings were a mixed bag as the economic solvency ratio, a measure of financial strength based on industrywide Solvency II principles, improved to 202% at the end of 2015 from 196% at the end of the third quarter.
Europe's third-biggest insurer will pay a dividend of €0.72 (80 cents), its best in eight years.
Generali said the results showed the quality of the turnaround plan launched by Mario Greco, who left the company abruptly this year to join rival Zurich Insurance Group Ltd.
Mr. Donnet, previously the insurer's Italy country head who was formally appointed as the new CEO on Thursday, said he would not change course from his predecessor's plan based on cost-cutting and the sale of assets.
"The strategic plan was approved last May. I was appointed yesterday ... to implement this plan," Mr. Donnet, a French national, told reporters.
Generali's shares, which have lost 20% since the beginning of the year due to uncertainty over its departing CEO, were down 2% at €13.58 ($15.14) by 0940 GMT.
The group said its profit in the fourth quarter came in at €304 million ($339 million), below a Thomson Reuters consensus estimate of €493 million ($549.7 million).
Full-year profit stood at just over €2 billion ($2.23 billion), also some €200 million ($223 million) short of forecasts but up 22% on a year earlier thanks in particular to the nonlife segment.
Generali's stock fell on the earnings miss, which was impacted by a net impairment of around €90 million ($100.4 million) on shares in BTG Pactual that Generali received as part payment for selling banking unit BSI to the Brazilian group. Market turmoil led to writedowns on other equity stakes.