FRANKFURT (dpa-AFX) - Disappointing revenue from Hannover Re's property and casualty reinsurance segment triggered a pullback in its shares on Monday. Falling by as much as 3.4 percent to just over 236 euros, the stock hit its lowest level since late January. The shares were last trading down 2.7 percent.
The decline in property and casualty reinsurance revenue continued through the first quarter. Overall reinsurance revenue fell by more than six percent year-on-year to approximately 6.5 billion euros, while industry experts had, on average, anticipated an increase to 7.1 billion euros. CFO Christian Hermelingmeier attributed the sharp decline to US dollar weakness and the termination of a contract in structured reinsurance.
Among the quarterly figures, property and casualty revenue missed market expectations most significantly, according to UBS analyst Will Hardcastle. This is expected to weigh on future earnings, to which investors are likely to react 'slightly negatively'.
According to Ben Cohen of RBC, property and casualty revenue missed the average analyst estimate by 13 percent, noting that exchange rate effects were among the factors weighing on performance.
Investors had already begun pulling back prior to the release: from a recent peak of over 280 euros in late April, the shares had lost 13 percent by Friday's close. For the current year, the stock is down nearly eleven percent./bek/stw/jha/
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