Aviva's sales increase beats forecast

By Myles Neligan | February 5, 2009, Thursday |

Print Edition

BRITISH life insurer Aviva Plc soothed concerns about its capital strength and said its dividend was safe as it reported a forecast-beating 8.6 percent rise in 2008 sales, sending its shares higher yesterday.

The company, which last month substituted the Aviva name for its best-known Norwich Union brand in Britain, said 2008 life and pension sales rose to 34.58 billion pounds (US$49.8 billion).

Analysts had expected the firm's sales to reach 33.52 billion pounds, according to the average of 17 estimates collected by Aviva.

The insurer also reported a strengthening of its regulatory capital cushion, and said that its policy of paying a dividend covered 1.5 to 2 times by earnings was unchanged.

The company reported a capital surplus of 2 billion pounds on December 31, up from 1.3 billion pounds in October, and estimated that it would still have a buffer of 1.3 billion pounds if equity markets fell 40 percent this year.

Aviva shares jumped 12.8 percent to 375.25 pence by 10:18am in London yesterday.

Finance

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Aviva's sales increase beats forecast

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