Munich Re returns to profit in third quarter
(Reuters) — Munich Reinsurance Co. returned to profit in the third quarter and affirmed its guidance for 2018, recovering from a spate of natural catastrophes a year ago.
Net profit came to €483 million ($553 million), the German reinsurer said Wednesday, compared with a €1.44 billion loss in the year-earlier period and analyst consensus for a €456 million profit.
“This good Q3 result puts us on track to achieve our profit target for 2018 — despite a series of major natural catastrophes still continuing in the fourth quarter,” Chief Financial Officer Joerg Schneider said.
Munich Re aims to post a 2018 full-year profit of €2.1 billion to €2.5 billion.
The group’s return to profit came despite a series of natural catastrophes in the third quarter, including Hurricane Florence in the United States and Typhoon Jebi in Japan.
Even considering those storms, Munich Re and the insurance industry are bouncing back from a series of major hurricanes, fires and earthquakes in North America in 2017, the costliest year ever for the industry. Reinsurers have been under pressure in recent years from falling prices amid intense competition.
Munich Re’s combined ratio, a key measure of profitability, was 100.7% in the third quarter, better than 160.9% a year ago.
Munich Re said it was “right on course” to score a 97% ratio for the full year. Readings below 100 indicate profitability.
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