NEW YORK (AP)—MetLife Inc. said on Wednesday that its second-quarter earnings more than doubled, topping Wall Street’s expectations, as the insurer recorded a $1.4 billion one-time gain from derivatives tied to interest rates that recently fell.
The New York-based company reported net income of $2.26 billion, or $2.12 per share, for the three months ended June 30. That was up from earnings of $1.07 billion, or $1 per share, in the same quarter a year ago.
Excluding one-time items, the company posted operating income of nearly $1.43 billion, or $1.33 per share. Analysts had been expecting $1.24 per share, on average, according to FactSet.
Revenue rose slightly, to about $16.79 billion from $16.65 billion.
MetLife posted a net loss in the first quarter while reporting a $1.3 billion derivatives loss due to contracts linked to interest rates and credit spreads. But rates fell in the latest quarter, contributing to a $1.4 billion derivatives gain after taxes. The company uses derivatives to hedge changes in interest rates and fluctuations in foreign currencies.
MetLife reported that revenue from premiums slipped about 1 percent compared with last year’s second quarter, to $9.14 billion. Fee revenue from universal life and investment-type products rose about 5 percent to nearly $2 billion.
Net investment income of nearly $5.19 billion was up about 4 percent from the second quarter of 2011.
Operating earnings in MetLife’s Americas region increased 11 percent to $1.1 billion. In Asia, earnings jumped 61 percent to $275 million, primarily due to business growth in Japan and strong investment income. Asian earnings in the year-ago period were reduced because of the effects of the March 2011 tsunami and earthquake in Japan.
In MetLife’s Europe-Middle East-Africa region, operating earnings rose 28 percent to $82 million due to a one-time gain and business growth, particularly in Turkey, Russia and the Persian Gulf countries.
MetLife shares fell 13 cents to $30.30 in after-hours trading. Before the earnings report was released, they fell 34 cents, to close the regular session at $30.43.