American International Group, Inc. (NYSE:AIG) has ended the short holiday week on a good note, with its fourth-quarter earnings report exceeding analysts’ estimates thanks to its surprising operating profit.
On Thursday, the stock jumped as high as 4.5% in after-hours trading. As Friday’s trading day is past its mid-point, the stock is currently up 2%, trading at $38.02.
From American International Group, Inc. (NYSE:AIG)’s fourth quarter earnings, it lost $4 billion ($2.68 per share) from absorbing costs from Superstorm Sandy and its airplane leasing unit sale. This compares to a $21.5 billion net income ($11.31 per share) from the previous year’s quarter as AIG saw a $19.2 billion tax-related increase.
For the company’s property casualty segment, it was hit hard by the Superstorm Sandy losses which took place on Oct. 29. From this, AIG saw a $1.3 billion after-tax loss and a fourth-quarter $945 million operating loss to its property casualty unit.
This compares to the previous year’s $367 million operating income.
In the fourth quarter, AIG’s operating income was $290 million (20 cents per share), down from $1.5 billion (77 cents per share) in the previous year. Analysts had estimated a 7 cent per share loss.
This quarterly report represented the first one for the company since the government completed the sale of its last share of it back in December.
AIG’s Chief Executive Officer, Robert Benmosche, said after the report, that the company has plans to rebuild life insurance sales outside the U.S. He said via Bloomberg, “We’re going to put a concerted effort to start reestablishing AIG throughout the world with our life insurance products.”
This comes after the company, through its efforts to repay for its U.S. rescue, used funds sold from its Hong Kong-based AIA Group Ltd. (1299), Canada and Taiwan assets. It is currently expanding in China in the cities of Beijing and Shanghai and is working with the People’s Insurance Co.
Last November, AIG announced it would take a $500 million share in the company while joint-venture negotiations took place.
American International Group, Inc. (NYSE:AIG) is also looking to expand in Turkey and increase consumer sales. Benmosche added, “What you’re going to see is, we continue to re-emerge as a strong global insurance company. You’re going to see us continue on the commercial side, which we’re already very, very strong. But we’re also going to become a global consumer sales organization on all life products.”
The company also plans to increase its employee ranks in 2013 through more hiring. American International Group, Inc. (NYSE:AIG) currently employs 63,000 workers.