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Aviva back in black with £776m profit but funds arm pins hopes on Munro's arrival
by Jun Merrett on Aug 08, 2013 at 07:55
Aviva has turned around its losses to report a £776 million post tax profit for the first half of 2013 thanks to a 16% uplift in UK's new business value.
For the first half of 2013 the life company reported a profit after tax of £776 million compared to the £624 million loss after tax in 2012.
Operating profit before tax was also up to £1 billion for 2013 from the £959 million made in the first half of 2012.
UK new business value boosted Aviva's results with a 16% increase to £211 million from the £182 million reported in the previous year.The total value of new business across the company stood at £401 million, a 17% increase on the £343 million for the first six months of 2012.
However the company was disappointed over the performance of Aviva Investors which delivered an operating profit of £31 million for the first half of 2013 from the £14 million over the same period in 2012.
Aviva's group chief executive Mark Wilson, said Aviva is pinning its hopes on newly appointed chief executive Euan Munro to lead the investment arm into improved profitability but warned it could take some time.
'While operating profit is satisfactory at a group level, it is far from satisfactory in several of our businesses... Aviva Investors has underperformed from a shareholder perspective and we expect it to play a more prominent role in the group going forward.
'We have recently appointed Euan Munro who will play a pivotal role helping Aviva Investors, a core part of the group, improve its profitability and contribution to Aviva.
'...Although some progress has been made reshaping these turnaround businesses and cutting expenses, there is some way to go before product mix and efficiency levels are adequate.'
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