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Boss Of Aviva plc Admits ‘Much Work To Be Done’

The shares of Aviva (LSE: AV) (NYSE: AV.US) slipped 2p to 443p during early trade this morning after Mark Wilson, the insurer’s chief executive, said the group remained “in the early stages of turnaround” and that he still had “much work to be done“.

Mr Wilson’s remarks accompanied a trading statement for the nine months to 30 September, which confirmed the value of new business at Aviva had gained 14% to £571m.

Highlights included new business climbing 5% in the UK, 33% in France and 43% in Asia.

The statement also revealed operating capital generation stable at £1.3bn and operating expenses down 7% to £2,277m. The combined operating ratio was declared at 96.9%.

Looking ahead, Mr Wilson reckoned new business growth would “moderate” in the fourth quarter and that restructuring costs for 2013 would be lower than the level reported for 2012.

He also predicted operating expenses for 2014 would be £400m lower than those incurred during 2011.

Prior to today, City analysts had been expecting Aviva to deliver earnings of 37.4p per share and a dividend of 15.1p per share for 2013.

Those projections currently place the shares on a possible P/E of 12 and a potential income of 3.4%.

Of course, whether those ratings, today's statement and the wider prospects for the insurance industry combine to make Aviva a 'buy' right now is something only you can decide.

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> Maynard does not own any share mentioned in this article.