July 27, 2010 / 5:16 PM / in 7 years

UPDATE 1-Industrial Alliance profit jumps on market gains

* Q2 net EPS C$0.68 vs average estimate C$0.67

* Net profit rises 80 pct

* Stronger economy, stock gains boost profit

* Shares down 1 Canadian cent at C$34.63

TORONTO, July 27 (Reuters) - Industrial Alliance Insurance and Financial Services (IAG.TO) said on Tuesday its second-quarter profit rose 80 percent, due to an improving economy and rising stock markets.

The Quebec City-based company, Canada’s fourth-largest insurer, earned C$57.7 million ($55.5 million), or 68 Canadian cents per share, in the three months ended June 30.

That compared with a profit of C$32.1 million, or 40 Canadian cents, in the year-before period.

Analysts had expected at profit of 67 Canadian cents a share, according to Thomson Reuters I/B/E/S.

Return on equity was 11.5 percent. The company has a 12 to 14 percent target range for that key measure of profitability.

Stock markets lost ground during the quarter, but were up year-over-year from the same quarter in 2009, when shares were recovering from the 2008 crash.

The company’s shares were down 1 Canadian cent at C$34.63 on the Toronto Stock Exchange.

$1=$1.04 Canadian Reporting by Cameron French

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