Bailout recipient and insurance behemoth American International Group (NYSE:AIG) reported a profitable second quarter Thursday, but adjusted earnings per share came in lower-than-expected, pressuring shares lower in after-hours trading after the stock closed at a 52-week low.
The company posted net income of $1.84 billion, or $1.00 a share, compared with last years second-quarter loss of $2.7 billion, or $19.57 a share. On an adjusted basis, the company reported operating income of $1.28 billion, or 69 cents a share, compared with year-ago after-tax operating income of $793 million, or $1.18 a share.
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Adjusted earnings missed analyst expectations, as the Street had predicted earnings of 92 cents a share, according to a poll by Thomson Reuters.
The companys insurance divisions, Chartis and SunAmerica, both saw operating income slide during the quarter to $789 million and $743 million, respectively, compared with operating income of $955 million and $858 million in the second-quarter of 2010.
AIG boasted that it had reached a significant recapitalization milestone in the quarter with its $8.7 billion common stock offering, which included the sale of 100 million shares issued by AIG and 200 million shares sold at a profit by the U.S. Treasury.
Our continued improving operating results should provide a catalyst for the U.S. Treasury to sell its shares at a profit for the taxpayers, said Robert Benmosche, AIG president and CEO, in a release. Now that we have fully repaid our debt to the Federal Reserve, we are on the right path to demonstrate AIG's long-term value as an investment-grade company independent of government support."
AIG paid off its debts to the New York Federal Reserve last January.
Shares of AIG fell to a new 52-week low on a day when all three major stock indices -- the Dow, S&P 500 and the Nasdaq composite -- all fell into correction territory. The stock closed down 6.35%, at $26.40 a share, and shares were slightly lower after results were announced.
AIG shares are down 54% year-to-date.