Investing.com — (EPA:SCOR) reported fourth-quarter net income of €208 million on Wednesday, beating analyst forecasts of €170 million, sending shares up more than 4% as a stronger-than-expected solvency ratio eased concerns that had weighed on the French reinsurer since third-quarter results.
The solvency ratio rose to 215%, above the 212% consensus and the 210% recorded a year earlier, driven by lower capital deployment than expected through the year.
An upcoming Solvency Review is expected to add approximately 15 percentage points, which would place Scor well above the upper end of its 185%-220% target range.
The property and casualty division led the beat, with an insurance service result of €256 million against a €212 million consensus. The combined ratio of 80.9% came in well below the 84.8% forecast, with natural catastrophe losses broadly in line at a 7.6% ratio.
Management added an estimated €50 million to reserves in the quarter, taking the full-year buffer build to more than €300 million and improving the confidence level interval from 75-80% to 77.5-82.5%. The full-year combined ratio of 82.3% remained within the company’s below-87% target.
The life and health division posted a quarterly insurance service result of €115 million, ahead of the €100 million consensus, while new business contractual service margin of €170 million more than doubled the €94 million forecast.
Full-year life and health earnings of €450 million exceeded the company’s approximately €400 million target.
“Driven by the disciplined execution of our Forward 2026 strategic plan and the exceptional commitment of our teams, SCOR demonstrated the robustness of its leading franchise and diversified business model,” Chief Executive Thierry Léger said.
Full-year net income reached €851 million, representing an annualised return on equity of 19.2%. Investment income of €209 million missed the €215 million consensus, though the regular income yield of 3.8% edged above forecasts.
P&C revenue of €1.80 billion and shareholders’ equity of €4.43 billion both missed consensus, with Morgan Stanley attributing both to foreign exchange movements.
Scor proposed a dividend of €1.90 per share, up 5.6% year-on-year, subject to shareholder approval on April 28.