Royal and Sun Alliance sees first-quarter profits climb (AFP)

LONDON (AFP) - British insurer Royal and Sun Alliance (RSA) has reported a 29-percent increase in operating profit on the back of cost cutting and an improved performance in the United States.

During the three months to March 31, the group's pre-tax operating profit jumped 29 percent to 207 million pounds (303 million euros, 384 million dollars), RSA said Thursday in an official earnings release.

That beat analysts' consensus forecasts of 193 million pounds and compared with 160 million during the same period the previous year.

Investors applauded the news, sending RSA's share price up 2.14 percent to 389 pence in early deals, while London's FTSE 100 index of leading shares, on which the group trades, rose by 0.46 percent to 6,111.10 points.

"Our key objective is to deliver sustainable profitable performance and each of our core businesses have again delivered strong results," chief executive Andy Haste said in the results statement.

The improvement reflected an efficiency drive that has so far reduced annual costs by 250 million pounds, the insurer added.

RSA also said it had benefited from a 4-million-pound insurance profit at its discontinued US operations, reversing a 14-million-pound loss a year earlier.

That helped offset flat revenues from insurance, with net written premiums during the first quarter easing to 1.435 billion pounds from 1.448 billion pounds previously.

Premium income has been held back by intense competition in Britain and Europe, forcing RSA to retreat from some segments of the market in order to preserve profit margins.

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