TRADING UPDATE
Outlook better than expected at MMI
Core headline earnings result was impacted negatively by ongoing pressure on revenue growth due to weak returns from investment markets over the past two years
Insurer MMI released a better-than-expected trading update as the market closed on Friday, warning that its diluted core headline earnings per share are expected to drop as much as 5% for its 2017 financial year. On the upside, earnings could increase 5%, translating into earnings of 190c to 210c per share when the group reports its results on September 6. Consensus analyst estimates placed the core earnings decline at 10%, or 179.9c, as the insurer battles to recover from its first half-year decline in core headline earnings since the 2010 Metropolitan and Momentum merger. "The core headline earnings result was impacted negatively by ongoing pressure on revenue growth due to weak returns from investment markets over the past two years," said MMI. "Core headline earnings also continue to be affected by weak underwriting experience on group disability business." More policies lapsed than expected in the Metropolitan Retail business during MMI’s fourth quarter, while Momentum’s experi...
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