American International Group Inc. said it had its first profitable quarter since 2007 — and warned that it still has plenty of repair work to do.
The troubled insurer said Friday that it earned $1.82 billion in the April-June quarter as some of its soured assets regained value. But its core insurance business deteriorated sharply amid the recession. And AIG cautioned that unwinding its $1.3 trillion worth of derivatives will take a long time and that future results will be volatile as it accounts for its restructuring.
Its big plan to pay back the government loan keeping it alive is to sell some of its businesses. But that plan has been revised “to take into account the deterioration of global market conditions,” and it now plans to “maximize the value of its businesses over a longer time frame,” the company wrote in a filing. AIG didn’t give details, but the message was clear that it’s not going to pull off any quick sales.
Investors appeared to focus on AIG’s profit, which included $311 million, or $2.30 a share, for common shareholders. The government owns about 80 percent of the company because of the bailout. AIG shares jumped $4.61, or 20.5 percent, to close at $27.14.
The company said its profit for the quarter that ended June 30 was driven by the stabilizing value of some of its riskier investments, including in its AIG Financial Products Corp.portfolio.
Total revenue rose 48 percent to $29.53 billion, from $19.93 billion a year earlier.
During the same period last year, AIG lost $5.4 billion, or $41.13 a share.
