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Zurich Insurance FY17 Profit Down; Ups Dividend; Sees To Meet 2017-2019 Targets

Zurich Insurance Group AG (ZURVY) reported Thursday that its fiscal 2017 net income attributable to shareholders decreased 6% to $3.0 billion from last year's $3.21 billion.

Earnings per share dropped 7 percent to $19.90 from $21.36 a year ago. In Swiss francs, earnings per share declined to 19.58 francs from 21.04 francs last year.

Business operating profit was down 15% to $3.8 billion from $4.50 billion last year. This was largely due to higher levels of natural catastrophe losses over the year, measures related to the Group's restructuring recognized within BOP and a one-time item resulting from changes to capital gains relief in the UK.

Adjusting for these items, Underlying business operating profit was $4.76 billion, compared to $4.50 billion last year.

Further, Zurich said it is well on track to achieve its 2017 to 2019 targets with $700 million in cost savings achieved, an underlying BOPAT ROE of 12.1%1 and an estimated Zurich Economic Capital Model (Z-ECM) ratio of 132%.

Reflecting the underlying earnings growth and positive earnings outlook, Zurich's Board of Directors will propose an increase of approximately 6% in the dividend to 18 francs per share to shareholders at the Group's annual general meeting on April 4, 2018.

Zurich also announced that, in line with the Group's policy on anti-dilution, it plans to implement measures that consist of the repurchase of shares of approximately $1 billion.

Group Chief Executive Officer Mario Greco said, "In a year of historic weather events, our focus and discipline delivered strong performance. We improved underwriting, reduced costs and expanded our service offerings, while growing premiums and improving our customer retention levels. These achievements made us resilient in the face of challenges and give us confidence as we look ahead to delivering our 2017 to 2019 targets."

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