Second-quarter profits down 35% at Munich Re

Munich Re, the world's biggest reinsurer, said second-quarter profit fell 35 per cent, missing analysts' estimates, as claims from natural disasters rose.

Net income dropped to €529 million from €808 million a year earlier, said the Munich-based company. That trailed the €557.1 million average estimate of eight analysts.

Claims from the June floods in central Europe were about €230 million. Munich Re kept its full-year earnings target of “close to” €3 billion after profit reached €1.5 billion for the first six months of the year.

“It is likely that the group will deliver on its €3 billion net income target but . . . the underlying performance suggests group income will trend down the coming years,” wrote analyst Thomas Seidl at Sanford Bernstein, London, in a note to clients. Munich Re fell as much as 4.7 per cent. – (Bloomberg)