Prudential Financial Inc. (PRU) swung to a first-quarter loss on
$718 million of investment write-downs, its third straight period
of red ink.
But shares rose 2.3% to $36.40 in after-hours trading as the
results topped Wall Street's expectations and the company cut its
2009 earnings guidance by 45 cents a share to $4.80 to $5.20.
Chairman and Chief Executive John R. Strangfeld Jr. said the
latest results "continue to reflect unfavorable market and economic
conditions."
Insurers have been stung by many billions of investment losses,
while credit rating downgrades have made it more difficult to raise
capital. Prudential is among the companies eligible for government
funds under the Treasury Department's Troubled Asset Relief
Program, though no awards have been announced.
Prudential, the second-largest insurer by assets behind MetLife
Inc. (MET), reported earnings of $14 million, down from $60 million
a year earlier. Those results include Prudential's closed-block
business, made up of life-insurance and annuity policies that it
sold when it was a mutual company but no longer offers.
Prudential's financial-services business reported a loss of $5
million, compared with a prior-year profit of $68 million.
Excluding investment gains and losses and other items, earnings
declined to $1.05 a share from $1.57. Financial-services revenue
climbed 16% to $8 billion as asset-management and related fees more
than doubled.
Analysts' estimates were for per-share financial-services
earnings of 83 cents on revenue of $6.58 billion, according to a
poll by Thomson Reuters.
Assets under management slid 2.9% to $542 billion from Dec. 31,
2008.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975;
Kathy.Shwiff@dowjones.com