US life insurer MetLife Inc. (MET), Wednesday reported a profit for the first quarter, turning around from a year-ago loss, on investment gains and narrowed derivative losses. MetLife's operating earnings for the quarter easily trumped Wall Street estimates on growth in the Americas, Asia and EMEA regions.
Derivative net loss for the quarter was $493 million, after tax, compared to $1.3 billion last year. MetLife, like other insurance companies, use derivatives to generate income and hedge against market risks, such as interest rate changes and currency fluctuations.
New York-based MetLife's first-quarter profit was $956 million or $0.87 per share, compared to a loss of $174 million or $0.16 per share last year.
Operating earnings, which exclude investment gains and losses, for the quarter rose to $1.64 billion or $1.48 per share from $1.46 billion or $1.37 per share last year. Analysts polled by Thomson Reuters expected earnings of $1.30 per share for the quarter. Analysts' estimates typically exclude special items. Operating earnings growth reflect strong performance at all three business regions of MetLife.
"MetLife had a very strong first quarter as all three of our business regions contributed to a 12% increase in operating earnings over the first quarter of 2012, and we generated an annualized operating return on equity of 12.7%," said CEO Steven Kandarian.
Operating earnings at MetLife's biggest region, Americas grew 12 percent, driven mainly by retail business. Asia earnings rose 11 percent, while Europe, the Middle East and Africa grew 21 percent.
Total operating revenues for the quarter grew to $16.98 billion from $16.65 billion last year. Analysts estimated revenues of $17.32 billion for the quarter.
Premiums for the three-month period improved to $9.15 billion from $9.13 billion last year.
Net investment gains for the quarter was $314 million compared to net investment losses of $110 million last year. Net investment income rose to $5.13 billion from $5.08 billion last year.
MET closed Wednesday's trading at $38.40, down $0.59 or 1.51%, on the NYSE. The stock, however, gained $0.85 or 2.21% in after hours trade.
For comments and feedback: editorial@rttnews.com