(Adds details on Brazil investment)
By Cameron French
TORONTO, July 30 (Reuters) - Intact Financial Corp, Canada’s largest property and casualty insurer, said on Wednesday its profits doubled in the second quarter, adding that the insurer had invested in a small insurance brokerage in Brazil.
Intact said the sharp profit growth was due to extreme flooding in Alberta last year, which had squeezed profits in the year-earlier quarter.
Net income totaled C$215 million ($197.99 million), or C$1.60 a share, up from C$103 million, or 73 Canadian cents a share, in the same quarter a year ago.
Operating income was C$1.53 a share, just short of analysts’ estimates of a profit of C$1.556 a share.
The company’s shares, which are up just over 3 percent year-to-date, rose 0.8 percent to C$71.67 on the Toronto Stock Exchange.
Underwriting profit climbed to C$128 million from C$42 million, as catastrophe losses dropped from the year-ago period, when floods hit Calgary and the surrounding areas.
In a statement, Intact Chief Executive Charles Brindamour said the company’s personal and auto insurance lines produced strong results during the quarter, but that the commercial property and casualty insurance portfolio was disappointing, “warranting corrective actions.”
Intact also said it had taken a C$20 million minority position in a small insurance brokerage in Brazil, which marks the company’s first foray into international markets.
Brindamour has said in the past Intact has been looking at several markets, with the goal of establishing itself in one or two markets outside Canada.
“As we validate some of our assumptions over time, this is potentially a market where you could see more capital being invested,” he said on a conference call on Wednesday.
Domestically, Intact has been an active M&A player over the last few years, buying up assets including the Canadian operations of French insurer AXA in 2011, and smaller Canadian players like Jevco Insurance in 2012 and Metro General Insurance Corp, which it agreed to buy earlier this year.
Toronto-based Intact is the former Canadian insurance arm of Dutch financial group ING Groep. It sells insurance under several banners, including Belair Direct and Grey Power. ($1 = 1.0859 Canadian dollars) (Reporting by Cameron French; Editing by Nick Zieminski and G Crosse)