American International (NYSE:AIG)
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5 Years : From May 2010 to May 2015
Profit at American International Group Inc. (AIG) more than doubled, to $3.21 billion in the first quarter, driven by improved results at its core insurance operations and changes in the value of two major holdings.
AIG's operating income of $3.1 billion, or $1.65 a share, beat analysts' consensus estimate of a $1.12 per share profit. Operating profit excludes some investment results.
Operating results at AIG's domestic life insurance and retirement services business rose 12%, to $1.31 billion before taxes, while the company's property-casualty arm swung to a $1.04 billion profit from a loss of $424 million in the same period a year earlier, the company said in a statement Thursday.
Chief Executive Officer Robert Benmosche has said that improving results at both operations are critical for AIG to meet the "aspirational goals" the company laid out last year. The goals include boosting AIG's return on equity to over 10% by 2015, slashing costs and deploying up to $30 billion in capital on share buybacks, dividends or acquisitions.
"Our profits this quarter illustrate, ultimately, the health of our business," Benmosche said in the statement. The New York-based insurer, which is still 70% owned by the U.S. Treasury as a result of its bailout during the financial crisis, is "keenly focused on building on our successes," he said.
First-quarter results were helped by an increase of more than $1.8 billion in the value of the company's minority stake in Asian life insurer AIA Group Ltd. (AAGIY, AAIGF, 1299.HK), whose Hong Kong-listed shares rose during the quarter.
AIG once owned all of AIA, but now must reflect changes in AIA's stock price in its quarterly results. The company recently sold off more of those holdings, which will reduce their effect on earnings.
AIG's interest in Maiden Lane III, a bailout-era facility designed to remove some mortgage-linked instruments from the insurer's books, added $1.25 billion to operating profit before taxes. It had added $744 million in the same period a year earlier.
-By Erik Holm, Dow Jones Newswires; 212-416-2892; firstname.lastname@example.org