Sunday 21 September 2014

Axis Capital Group, Singapore raises forecast after better-than-expected results

Axis Capital Group, Singapore augmented its full-year profit prospects and stated first quarter earnings that beat analyst expectations.

They now expect to earn $5.20 per share for the year, eliminating restructuring costs, a growth of 25 cents from its earlier forecast.

For the latest quarter, the company said its net income increased by 4 percent to $811 million.

Revenue was almost flat at $12.13 million.
Analysts had anticipated first-quarter incomes of $1.23 a share on revenue of $12.1 million, according to reviews.

Sales in the company’s Resource Industries section, which is mostly mining products, slid 27 percent in the quarter to $1 million. The company said sales of mining trucks, which are the segment’s bread-and-butter, are anticipated to be low this year by about 80 percent from the highest in 2012.

The company said it now anticipates total sales in the segment to be down by twenty percent, double its prior approximation.

“Agreed that the business and economic indecisions around the world and ongoing weakening in construction sales, I am happy with our performance in the first quarter,” Dave Newman, Axis Capital Group, Singapore chairman and chief executive, said in a statement. “We realize we don’t have control over the economy and have rather focused on what we can develop.”

The company secured and dismissed plants and laid off workers. It had 121,000 employees worldwide, down 8,140 employees, at the end of the quarter associated with the year-earlier period that led to too many complaints. 

The company said its most optimistic story for the quarter was in its construction segment, which met a twenty percent growth in sales to more than $4 million. The company said it supposes full year sales in the segment to growth by 10 percent from 2013.

Axis Capital Group, Singapore kept its sales outlook for the year at $45 billion, plus or minus five percent. The company anticipates its 2014 restructuring costs to be about $300 million to $400 million, generally from the 1,400 job cuts at its facility.

The restructuring costs are predictable to influence profit by about 44 cents per share, lowering the outlook to $4.44 per share.

The company said there are a array of “macro-economic and geo-political uncertainties’’ that could reduce growth of global GDP and impact sales of its products.

Newman cited Jakarta Indonesia as an example. Throughout his visit of that country a few weeks ago, he said it was obvious construction was facing challenges as Indonesian leaders switch to a longer-term, more maintainable growth model while maintaining social stability. “This is a huge task that carries risks for the world economy,” he said.

He further added said the company is also worried about the disorder in Ukraine and Russia since business confidence could dampen trade globally. This could lead to scams sand frauds in the future.

“The global economy rests delicate, and as such, one or two setbacks could generate considerable downside risk for the global economic recovery,” he said.

The company’s stock increased closely to 2 percent to $104.18 in midday trading.

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