Aegon posts 19% gain in earnings

But a flat outlook is heard by one money manager as `a profit warning'

March 08, 2002|By Ted Shelsby | Ted Shelsby,SUN STAFF

Aegon NV, the Dutch insurance company that employs about 1,000 people in the Baltimore metropolitan area, said yesterday that its fourth-quarter profit increased 19 percent and earnings for the full year were up 16 percent.

The company that net income for the current year will "be at least equal" to last year's $2.1 billion.

Some analysts were surprised by the projection, given Aegon's history of projecting at least 10 percent growth annually.

This "comes across as a profit warning," said Adrian Farthing, an investment manager at Old Mutual PLC, which owns Aegon stock.

Robert J. McGraw, executive vice president at Aegon, attributed the flat earnings projection to the company's sale of some operations in Mexico last year.

Aegon earned $573 million, or 41 cents a share, during the fourth quarter. That was up from net income of $495 million, or 38 cents a share, in the like part of 2000.

Revenue rose slightly to $7.32 billion, up from $72.8 billion in the final quarter of 2000.

For the full year, the insurer earned $2.1 billion, or $1.58 a share, compared with $1.9 billion, or $1.45 a share, posted for 2000.

Revenue increased to $28.6 billion from $28.4 billion.

Aegon, which has its headquarters in The Hague, said its North American units in the United States, Canada and Mexico accounted for 62 percent of the company's total income last year, on a pretax basis.

The North American operations posted a profit of $373 million from revenue of $4.5 billion last year. During 2000, these operations earned $313 million from revenue of $3.8 billion.

The company previously announced that Donald J. Shepard, who heads the company's business group in the United States, is to take over as head of Aegon next month. He will be the first American to head the company.

Shares of Aegon fell 70 cents to $23 on the New York Stock Exchange yesterday.

Bloomberg News contributed to this article.

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