CU upbeat after profits hit £402m

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The Independent Online

Commercial Union, the composite insurer, cheered the City yesterday with record profits and an upbeat assessment of its prospects.

The company said the integration of its recent French acquisition, Groupe Victoire, was going well. John Carter, chief executive, said: "The acquisition of the life and general insurance business of Groupe Victoire has significantly expanded the scope of our operations and is expected to improve the quality of the group's earnings."

The French group contributed a quarter's worth of figures to the results for 1994, showing a life insurance profit of £25m and a general insurance loss of £14m.

CU's total profits almost doubled to £402m before tax and the dividend rises to 26.4p from 24.52p.

Mr Carter said: "Nineteen ninety-four has been a most significant year for the group. All of our major trading areas produced improved results. General insurance profits advanced to £347m from £187m, in line with a cyclical upturn across the industry in the UK. Life profits were £154m against £121m."

Mr Carter also said substantial progress was made on the reorganisation of Dutch subsidiary Delta Lloyd. The group took a £28m charge for the rejig to add to 1993's £20m.

Floods in Europe will cost £7m this year, while the group's exposure to the Japanese earthquake is estimated at £10m.

CU's shares rose 10p to close at 515p.