FRANKFURT--Germany's Munich Re AG (MUV2.XE) on Tuesday cut its full-year profit guidance to the lower end of its previous range after net profit almost halved in the first quarter--mainly on weaker results from equity investments--and as it anticipates more costs to restructure the group's Ergo primary insurance business. Net profit fell 46% to 430 million euros ($489 million) from EUR790 million in the same quarter a year ago. That was well below a Dow Jones Newswires analysts' forecast of EUR550 million. Revenue fell 4% to EUR12.51 billion, below the forecast EUR13.11 billion. The world's biggest reinsurer by revenue said it now aims for a full-year target of after-tax profit of EUR2.3 billion, at the lower end of the previous guidance range of between EUR2.3 billion and EUR2.8 billion. That target includes minorities. "The decrease in profits in the first quarter has dampened our optimism with regard to the annual result. It is looking more and more likely that there will be high costs for implementing the strategy programme at ERGO," said Chief Financial Officer Joerg Schneider. "The amount is not yet definitive, but it is unlikely that Ergo will post a positive annual result this year." Net investment income fell 14% to EUR1.57 billion, slightly below the forecast EUR1.59 billion. -Write to Ulrike Dauer at ulrike.dauer@wsj.com
• Re - 1Q16 net profit of € 430 m ( $ 650 m ) , down 20 % YoY , below inflation , primarily due to weaker returns from equity investments . The bank stated it has shifted its FY16 profit guidance to the lower costs of its previous range as it anticipates more costs to restructure its Ergo primary insurance business .