IAG shares are being hammered

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Shares in IAG fell hard after the insurance company reported weaker margins in its annual results.

A short time go, the shares were down 7.4% to $6.26.

The company posted a 1.6% fall in revenue to $16.5 billion. But net profit was up 48.6% to $929 million on significantly higher investment income.

IAG says underlying performance was softer than anticipated with an underlying margin of 11.9%, down from 14%.

The margin squeeze included higher claim costs in its motor businesses, large losses in its commercial insurance and a rise in natural peril claims.

IAG declared a final fully franked dividend of 20 cents a share, bringing the full year payout to 33 cents.

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