Aegon raises dividend after higher profit | Financial

Aegon’s net profit for the past quarter, reported Thursday before the close of trading, amounted to €849 million. According to CEO Lard Friese a ‘strong result’. In response, the price ran 6.6% on.

The net loss of more than €1 billion a year earlier in the corona pandemic should have resulted in a profit of €331 million, according to the consensus of analysts.

The market was very happy with investments, says Friese, referring to the rising interest rates in recent months. But Aegon has also cut its costs by another €220 million. The CEO says that this is on track for the plans for 2023, whereby he must achieve a structural cost saving of €400 million. Aegon is redeeming $250 million in bonds.

Analysts had already expected a stronger second quarter result, especially in its US operations.

Operating profit is also better than expected at €562 million, with an increase of 62%. Analysts were expecting an average of €462 million here, compared to €347 million a year earlier, and €228 million from US sales (2020: €133 million) thanks to the recovery of variable annuities.

Buy back shares

In July, Aegon, formed in 1983 from the merger of AGO and Ennia, announced that it was repurchasing its own shares worth €133 million. This was intended to limit the dilutive effect of last year. An effect that has pleased investors in recent months.

Friese also clearly beat expectations with a Solvency II ratio of 208%. Market researchers had expected it to be 198%, in 2020 it was 195%.

The same market researchers generally expected an increase in the dividend from €0.06 to €0.07 per share. That increase in the interim dividend amounted to an additional €0.02 on Thursday morning, €0.08 in total. “A positive surprise,” said analyst Robbert Manders of broker IG.

“The progress we are making gives us confidence to increase our dividend faster towards our 2023 target of around €0.25 per ordinary share,” said Friese.

Selling in USA

Aegon bids farewell to savers at Aegon Bank in the Netherlands. Since June, customers have been asked to transfer their accounts to online bank Knab, part of Aegon.

In the US, it took advantage of the recent rise in interest rates for its investments. Friese previously announced that it was putting its portfolio of variable US annuities on the table for sale. The company already sold the Transamerica Ventures fund in the US this year, followed by Stonebridge.

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