Suncorp earnings boost from joint venture sales

Suncorp yesterday reported that it would include after-tax profit of between $110 and $125 million in its June 30 result from the sale of its 50 per cent holding in Royal Automobile Association of South Australia and Royal Automobile Club of Queensland.

The joint ventures have been independently valued at $348 million.

The company issued a statement saying the divestments would not affect Suncorp's ability to compete in those markets.

The sales will add significantly to Suncorp's bottom line. It reported a net profit of $364 million in the December half, $90 million in the June half last year and $258 million for the six months to December 2008.

Analysts had already factored in a big increase in earnings for the June year. The consensus forecast among the four analysts surveyed by Aspect Huntley's FinAnalysis service is for earnings per share of 62 cents, compared to 31.1 cents per share last year.