Insurance giant Allianz looks to be on course for strong growth in 2006 following a solid first quarter and expects to be able to boost profits without big takeovers.
Allianz released preliminary results late today showing net profit rose to €1.8 billion in the first quarter well above analysts' estimates.
"The result is an initial indicator that we will achieve our goals for 2006," chief executive Michael Diekmann said in the text of a speech for delivery at the company's annual meeting.
Allianz shares were up 0.9 per cent at €135.08 by 8:11am, outperforming the DJ Stoxx index of European insurers, which was up 0.4 per cent.
Allianz was already well positioned as the financial services sector heads into a predicted consolidation, Mr Diekmann said.
But Allianz was not satisfied with the performance of its Dresdner Bank unit, where costs are high relative to the income it is generating.
"We are devoting all our attention to achieving additional essential improvements on the income and cost side during the current fiscal year," Mr Diekmann said.
German media reports said this week Dresdner might be planning to cut hundreds of administrative jobs.
Allianz is due to report full financial results for the first quarter on May 12th.
Allianz shares have risen around 5 per cent this year but have lagged the DJ Stoxx index of European insurers, which has climbed almost 8 per cent. Shares in Allianz are priced at 11 times prospective 2006 earnings, a 2 per cent discount to the average for German insurers and a 5.5 per cent discount to European sector peers.