AXA, UAP REPORT MIXED '96 RESULTS BEFORE MERGERPosted On: Mar. 30, 1997 12:00 AM CST
PARIS-AXA-UAP, which will merge later this year, last week reported dramatically different results for 1996.
AXA S.A. announced a 39.5% increase in its net income at year end 1996 to 3.8 billion francs ($666.9 million). However, UAP reported a loss of 6.4 billion francs ($1.12 billion) after exceptional items totaling 7.6 billion francs ($1.33 billion).
The results of the two companies that form AXA-UAP were announced separately, as AXA and UAP Group do not merge formally until May. They announced the merger last November and have said the company worldwide simply will be called AXA (BI, Nov. 18, 1996).
UAP's exceptional items, which the company says result directly from the merger, include 3.7 billion francs ($649.4 million) for the re-evaluation of some assets and liabilities in the life and property/casualty insurance business in France and Italy and within its subsidiary Banque Worms.
The exceptional items also include 800 million francs ($140.4 million) for costs in its real estate companies and 1.8 billion francs ($315.9 million) for the waiver of deferred tax credits against past losses.
Meanwhile, AXA's results include those of New York-based life insurer Equitable Group, whose net income dropped dramatically to 143 million francs ($25.1 million) last year from 497 million francs ($87.2 million) in 1995. This decrease, according to AXA, was the result of two exceptional items: the strengthening of reserves for disability insurance by 1.1 billion francs ($193.1 million) and the implementation of new U.S. accounting rules which resulted in a charge totaling 560 million francs ($98.3 million).
AXA-UAP together had revenues last year totaling 340 billion francs ($59.67 billion).