French insurer axa has actually cancelled plans for a special dividend and withdrawn a number of its financial targets for 2020 after it took a 1.5bn hit from statements about covid-19.

Axa said on thursday that net revenue dropped to 1.43bn in the 1st half of 2020, down 39 percent compared with equivalent period a year ago, while revenues dropped 10 % to 52.4bn. additionally announced that its 1.2bn sale of axa life europe had collapsed.

The 1.5bn fee for covid-19 statements, which dragged straight down earnings, was at line with previous estimates but axa left open the opportunity of it increasing into the coming months.

There are, you know, questions. therefore, as an example, one question is, maybe there is a second wave? maybe there is more business disruption?, thomas buberl, axa chief executive, told the financial instances. the group conformed in june to pay for the losings of a huge selection of restaurants after a legal challenge by a policyholder in france.

Covid-19 may very well be the most pricey activities previously for the insurance coverage industry, with payouts anticipated across a range of policies from business disruption to visit. swiss re estimates that statements will surely cost a between $50bn and $80bn, placing it on a par with a sizable natural catastrophe.

Axas share price has actually fallen 30 % to date in 2010, and dropped 3 % on thursday.

In addition to scrapping two of its growth objectives for earnings per share and return on equity axa stated that after directions from french regulators it might not be making any additional dividend repayments in 4th one-fourth.

The regulatory context features obviously altered. and there's a definite message from regulator: do not pay anything more in 2020. so, understandably, we must adhere to this, stated mr buberl.

Axas main confirmed that the dividend have been cancelled, instead of simply suspended. he had formerly struck out at exactly what he saw as insufficient co-ordination in europe over dividends, saying he could spend a fourth-quarter top-up payment to investors if market and regulatory problems permitted.

Mr buberl additionally blamed complexity for the termination of this axa lifestyle europe sale to london-based private equity team cinven, which was inked two years ago.

We stated, look, whenever we cannot satisfy all conditions for finishing by this lengthy end date, we're going to abandon this transaction. and that is why we said, fine, lets stop it. it's also complex. we wont discover most of the answers, said mr buberl.

Long-term variable annuities across several countries is a really complex nature of company. and having been extremely near to this file, its precisely associated with that, he included, while refusing become attracted on whether it was regulators who end the offer.

The failure of the sale arrangement cancels at the very least 1bn of remittances expected in the first 1 / 2, said james shuck, an analyst at citigroup, in an email to clients.

Mr shuck included the first-half results contained plenty of downsides without a lot of offsets.