American International Group Inc. finally released its second-quarter earnings Tuesday, and it also restated results for the second quarters and first halves of 2003 and 2004.[@@]
AIG, New York, is reporting $4 billion in net income for the latest quarter on $27 billion in revenue, up from $2.7 billion in net income on $23 billion in revenue for the second quarter of 2004.
Some competitors may have hoped that recent management changes and regulatory scrutiny would have broken AIG’s stride, but the company says its operations performed well during the quarter.
Worldwide life and retirement services operating profits increased 13%, due in part to the rising strength of non-U.S. currencies relative to the U.S. dollar.
But falling investment returns in the United States led AIG to hold back on U.S. annuity sales, and domestic life and retirement earnings rose only 5.1%, AIG says.
Accounting changes related to efforts to control investment risk and currency-fluctuation risk added $825 million to net income in the current quarter and subtracted $120 million from net income in the second quarter of 2004.
AIG has come up with an “adjusted” earnings figure by calculating income figures that exclude all unusual gains and charges for the latest quarter and the second quarter of 2004. By that measure, AIG earnings increased 14%, to $3.3 billion.