NU Online News Service, Feb. 14, 1:31 p.m. – The AXA Group, Paris, is reporting the equivalent of $66 billion in revenue for 2001, down 14% from revenue of $80 billion for 2000.
AXA presents its results in euros and follows European financial reporting customs. Information about AXA’s profits was not immediately available, and the dollar value of its revenue has been affected by the declining value of the euro versus the dollar.
The dollar figures given here use an exchange rate of 1 euro=88.58 U.S. cents for the 2001 results, and an exchange rate of 1 euro=94.16 cents for the 2000 results, based on exchange-rate data from OANDA Corp., New York.
When expressed in euros, AXA revenue actually increased 5.2%, to 48 billion euros.
At AXA’s life and savings unit, revenue worldwide revenue held steady at $43 billion.
Life and savings revenue fell to $24 billion, from $25 billion, in Europe, and to $10 billion, from $12 billion, in the United States.
Results were strong in the United Kingdom because of the introduction of a new personal pension plan system, but weak in France because of poor investment market performance, AXA says.
In the United States, variable annuity sales were down sharply, but fixed annuity sales and a new single-premium deferred annuity product sold so well that total annuity sales increased 5%, AXA says.
AXA found that U.S. life insurance revenue suffered in early 2001 as a result of uncertainty about federal estate tax rules. Sales recovered later in the year, after President Bush signed the Economic Growth and Tax Relief Reconciliation Act and AXA introduced an estate-tax uncertainty rider.
The rider offers a return of cash values, excluding any surrender charges, if the estate tax is ever fully eliminated, AXA says.