(Bloomberg) --

Axa SA is moving past its Covid-related woes as profit recovered from a 2020 slump and surged to a record.

Earnings last year jumped to 7.3 billion euros ($8.3 billion), the Paris-based insurer said Thursday in a statement, beating the average estimate in a Bloomberg survey of analysts. The figure was more than double earnings posted for 2020, when the firm booked a 1.5 billion-euro charge due to the pandemic.

“Regarding Axa’s fundamentals, we are extremely confident,” Chief Financial Officer Alban de Mailly Nesle said in a call with reporters. “This is what we showed in 2021, and we start the year with confidence.”

Axa is emerging from a difficult period for insurers, which were hit by simultaneous claims across various industries when the coronavirus pandemic shut down large parts of the economy. Munich Re also reported a profit rebound for 2021, saying Wednesday that profit more than doubled, which will allow the company to return 2.5 billion euros via a share buyback and higher dividend. 

Axa, which completed a 1.7 billion-euro share buyback earlier this month, is launching an additional 500 million-euro stock-repurchase program on Feb. 28 to compensate for the earnings dilution triggered by disposals, as announced in November. The firm also plans a 1.54 euro dividend, up 8% from last year.

AXA XL, the insurer’s unit dedicated to large corporate risks, reported underlying earnings of 1.2 billion euros, meeting the target set by Chief Executive Officer Thomas Buberl. 

The unit, which the firm acquired in 2018 for $15.3 billion, is a key part of Buberl’s effort to shift the company’s focus to its underwriting activity. Shareholders will vote at the annual meeting in April whether to give the CEO, who is now concentrating on growing the insurer’s health unit, another term at the helm. 

The insurer also announced its intention to transform its holding company into the group’s internal re-insurer. The entity will become a licensed re-insurer and absorb Axa Global Re in a merger, according to the statement. The deal, which is subject to regulatory and shareholder approvals, is expected to result in 2 billion euros in additional cash at Axa SA by 2026.

The strong results allowed Axa to update its outlook. The firm believes it is well-positioned to deliver underlying earnings-per-share growth at the top of the 3%-to-7% range it set for itself from 2020 to 2023.

The insurer, which aimed for 14 billion euros in “upstream” cumulative cash for the 2021-2023 period, believes it could now exceed that target, which refers to cash generated by its operating units and transferred back to the holding company. 

Axa’s overall revenue rose 3% to 99.9 billion euros. The firm’s property-and-casualty unit, the biggest contributor to revenue, saw sales rise to 49.3 billion euros.

As of the end of December, Axa’s solvency ratio stood at 217%, above the average estimate of 215%. 

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