November 28, 2018 / 8:14 AM / in 8 months

Insurer AXA raises profit targets after buying XL

PARIS, Nov 28 (Reuters) - Insurer AXA expects profitability to speed up in the coming two years thanks to business brought in by XL, which it bought earlier this year, and added it hoped to boost dividends.

AXA, Europe’s second-biggest insurer after Allianz , said it expected adjusted return on equity (ROE) to increase between 14-16 percent annually over the coming two years, up from a previous target of between 12-14 percent.

The French insurer also confirmed its target for underlying earnings per share to increase 3-7 percent a year over the same period.

AXA expects profitability will be boosted by the diversification achieved from its $15 billion acquisition of XL earlier this year. The company also raised its expected synergies on XL to 500 million euros from 400 million before.

As a result, AXA will increase its dividend payout range to between 50-60 percent from 45-55 percent previously.

AXA shares were up 1.7 percent in early session trading. (Reporting by Inti Landauro; Editing by Sudip Kar-Gupta)

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