American Financial Group, Inc. (AFG), Tuesday reported a rise in profit for the fourth quarter, helped by after-tax net realized gains, compared to a loss last year. Earnings topped analysts' estimates by 6 cents. Looking ahead, the company raised its full year 2010 earnings guidance, expecting in line with analysts' estimates.
The Cincinnati, Ohio-based property and casualty insurer's net earnings attributable to shareholders for the fourth quarter increased to $161 million or $1.38 per share from $39 million or $0.32 per share in the previous year.
Results for the quarter include after-tax net realized gains of $40 million or $0.34 per share, compared to after-tax net realized losses of $83 million or $0.72 per share in the same quarter of the previous year.
Core net operating earnings for the period were $121 million or $1.04 per share, compared to $122 million or $1.04 per share in the year-ago period.
On average, three analysts polled by Thomson Reuters expected the company to report earnings of $0.98 per share. Analysts' estimates typically exclude special items.
Revenue for the quarter rose to $1.12 billion from $1.10 billion in the same quarter last year.
P&C insurance premiums declined to $603 million from $763 million a year ago. Life, accident & health premiums were $113 million, up from $109 million in the comparable quarter last year. Investment income declined to $300 million from $303 million in the previous year.
Realized investment gains were $60 million, compared to losses of $133 million in the comparable quarter last year. Other income declined to $49 million from $62 million last year.
Total costs and expenses for the quarter declined to $0.89 billion from $1.04 billion a year ago. P&C insurance losses & expenses were $506 million, down from $667 million last year.
For the fiscal year 2009, net earnings increased to $519 million or $4.45 per share from $196 million or $1.67 per share in the previous year. Core net operating earnings were $493 million or $4.23 per share, compared to $476 million or $4.07 per share. Revenue for the year increased to $4.32 billion from $4.29 billion a year ago.
Analysts expected earnings of $4.17 per share for the full year.
Looking forward, the company raised its core earnings guidance to the range of $3.30 and $3.70 per share from its previous forecast in the range of $3.10 to $3.50 per share for the fiscal year 2010. Street analysts expect earnings of $3.67 per share.
AFG closed Tuesday's regular trading at $24.58, up 0.28 or 1.15%, on a volume of 0.42 million shares on the NYSE. In after hours, the stock declined 0.23 or 0.93%, trading at $24.352.
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