PARIS (Reuters) - AXA (AXAF.PA), Europe’s No. 2 insurer, said forecasts for profit growth through 2015 could fall short of targets in the face of tough market conditions.
Underlying earnings-per-share growth over the 2010-2015 period might amount to just 5 percent, compared with a 5-10 percent target announced in a strategic plan last year.
AXA Chief Executive Henri de Castries said in a slide presentation to be distributed at its annual investor seminar on Wednesday that the insurer was “mitigating the financial impact of unfavorable markets”.
AXA also said it saw adjusted return on equity within a range of 13 to 15 percent in 2015, compared with an earlier forecast of 15 percent.
The insurer has posted only moderate profit and revenue growth in recent quarters as market turbulence has hit investment products, especially in its domestic market.
De Castries acknowledged as early as October last year that weak market conditions could result in growth targets being lowered.
In an investor presentation at the time, he said targets could be negatively impacted by prolonged weak market conditions such as equity market returns of 0 percent and 10-year government bond yields of 3 percent over the 2011-2015 period.
AXA Chief Financial Officer Gerald Harlin said last month the insurer was “absolutely positive” on its ability to meet the targets.
Editing by James Regan and David Cowell