MUNICH - Thursday, 10. August 2023 AETOSWire Print
Group Affirms Full-year Outlook
(BUSINESS WIRE) -- August 10, 2023
2Q 2023:
Total business volume surges 5.9 percent to 39.6 billion euros
Operating profit increases 7.1 percent to 3.8 billion euros; strong performance particularly in Life/Health and Property-Casualty business segments
Shareholders’ core net income jumps by 22.9 percent to 2.5 billion euros
6M 2023:
Total business volume rises 4.8 percent to 85.6 billion euros
Operating profit increases 14.9 percent to 7.5 billion euros: primarily driven by Life/Health and Property-Casualty business segments
Shareholders’ core net income up 90.2 percent to 4.7 billion euros
Excellent Solvency II capitalization ratio of 208 percent, compared with 201 percent at the end of 4Q 20221
Outlook:
2023 operating profit target confirmed at 14.2 billion euros, plus or minus 1 billion euros2
Other:
Share buy-back of up to 1.5 billion euros on track: 2.9 million shares acquired for 0.6 billion euros until the end of July 2023.
Note: The financial results are based on the new IFRS 9 (Financial Instruments) and IFRS 17 (Insurance Contracts) accounting standards, which have been adopted as of January 1,2023. Comparative periods have been adjusted to reflect the application of these new accounting standards.
1
Excluding the application of transitional measures for technical provisions.
2
As always, natural catastrophes and adverse developments in the capital markets, as well as factors stated in our cautionary note regarding forward-looking statements may severely affect the operating profit and/or net income of our operations and the results of the Allianz Group.
“Allianz’s excellent results in the first half of 2023 demonstrate the strength of our fundamentals as we capitalize on our global scale and diversified business mix for the benefit of our customers and our shareholders. With our double-digit growth in profits we are well on track to achieving our Group targets for the year.
I am particularly pleased by the strong performance in the Property & Casualty business where we have achieved a strong 92% combined ratio, by the continued volume and profit growth of our Life & Health business, as well as by the resilience of our Asset Management segment, which recorded positive third-party net inflows for the second quarter in a row despite cautious investor sentiment.
Our solid growth is a clear reflection of our customers’ continued trust in us to support them through this agonizing period of inflation and polarization. These trends not only challenge our global economy, but also affect people deeply at an individual financial level. With our results and capital position, we demonstrate that Allianz is a company that unfailingly delivers relevant solutions that people need, especially in our turbulent age.”
- Oliver Bäte, Chief Executive Officer of Allianz SE
FINANCIAL HIGHLIGHTS
Total business volume
2Q 2023: Total business volume rose by 5.9 percent to 39.6 billion euros, driven by the Property-Casualty business segment which benefited from higher prices and volumes while the growth of the Life/Health business segment was primarily linked to strong single-premium volumes in the US. This growth was partially offset by a decrease in AuM-driven revenues in our Asset Management business segment.
Internal growth, which adjusts for foreign currency translation and consolidation effects, was strong at 8.7 percent, driven by the Property-Casualty business segment and supported by the Life/Health business segment.
6M 2023: Total business volume rose by 4.8 percent to 85.6 billion euros, driven by the Property-Casualty business segment, supported by the Life/Health business segment, and partially offset by a decrease in our Asset Management business segment.
Internal growth was strong at 6.4 percent, driven by the Property-Casualty business segment.
Earnings
2Q 2023: Operating profit increased 7.1 percent to 3.8 (2Q 2022: 3.5) billion euros. This is due to a higher result of our US operations in the Life/Health business segment, and a stronger insurance service result in the Property-Casualty business segment. This was partly offset by the Asset Management business segment due to lower AuM-driven revenues.
Shareholders’ core net income was strong at 2.5 (2Q 2022: 2.0) billion euros due to a higher operating profit.
Net income attributable to shareholders was 2.3 (2Q 2022: 2.0) billion euros.
Core earnings per share (core EPS)3 was 11.40 (6M 2022: 5.77) euros.
The annualized core return on equity (RoE)3 was 16.7 percent (full year 2022: 12.7 percent).
6M 2023: Operating profit increased 14.9 percent to 7.5 (6M 2022: 6.5) billion euros. This is due to a higher operating investment result in our Life/Health business segment and a higher operating insurance service result in the Property-Casualty business segment. This was partly offset by the Asset Management business segment due to lower AuM-driven revenues.
Shareholders’ core net income was 4.7 (6M 2022: 2.5) billion euros due to a higher operating profit and an improved non-operating result. Non-operating result in the prior year was impacted by a provision related to the AllianzGI US Structured Alpha matter.
Net income attributable to shareholders was 4.4 (6M 2022: 2.5) billion euros.
3
Core EPS and core RoE calculation based on shareholders‘ core net income
Solvency II capitalization ratio
The Solvency II capitalization ratio was 208 percent at the end of 2Q 2023 compared with 206 percent at the end of 1Q 2023. Including the application of transitional measures for technical provisions, the Solvency II capitalization ratio was 235 percent at the end of the second quarter of 2023 compared with 232 percent at the end of the first quarter of 2023.
SEGMENTAL HIGHLIGHTS
“Our strong results and consistency of delivery are showing once again the quality of our franchise.
Growth in total business volume in our Property-Casualty segment was excellent. We achieved strong rate increases and continue to take actions to successfully offset inflation. The performance in commercial lines was outstanding as a result of solid pricing momentum and strong underwriting discipline.
Operating profitability in our Life/Health business is very strong. Sustained value creation, well supported by growth in PVNBP and a strong new business margin, is evidence of our ability to deliver value to our customers while achieving healthy profitability.
Our Asset Management business continued to achieve positive net inflows in the second quarter as we supported our clients to navigate through a challenging business environment. Third-party assets under management were stable at 1.7 trillion euros compared to the first quarter. This bodes well for future profitability.
We confirm our full-year outlook of operating profit of 14.2 billion euros, plus or minus 1 billion euros.”
- Giulio Terzariol, Chief Financial Officer of Allianz SE
Property-Casualty insurance: Double-digit growth
2Q 2023: Total business volume rose by 8.0 percent to 17.6 (16.3) billion euros. Adjusted for foreign currency translation and consolidation effects, internal growth was strong at 11.4 percent due to a price effect of 7.1 percent and a volume effect of 4.7 percent, slightly offset by a service effect of -0.5 percent. The main contributors to the increase were Allianz Partners, Australia, Latin America and Germany.
Operating profit increased by 10.8 percent to 2.0 (1.8) billion euros, benefiting from a higher operating insurance service result as well as an improved operating investment result.
The combined ratio improved by 0.4 percentage points to 92.2 percent (92.6 percent). The loss ratio improved by 0.4 percentage points to 67.4 percent, benefiting from lower claims from natural catastrophes and a positive discounting impact. This was partly offset by higher claims inflation and a lower run-off result. The expense ratio increased slightly by 0.1 percentage points to 24.8 percent (24.7 percent).
6M 2023: Total business volume surged 9.8 percent to 41.7 (38.0) billion euros. Adjusted for foreign currency translation and consolidation effects, internal growth was very strong at 11.8 percent, supported by a price effect of 6.4 percent as well as a volume effect of 5.4 percent and a service effect of 0.1 percent. While many entities added to that growth, the primary contributors were Allianz Partners, Türkiye, AGCS and Germany.
Operating profit rose 16.3 percent to 3.9 (3.3) billion euros, driven by a significantly higher operating insurance service result and an improved operating investment result.
The combined ratio improved by 1.1 percentage points to 92.0 percent (93.2 percent). The loss ratio improved by 0.9 percentage points to 67.2 percent due to lower claims from natural catastrophes and a favorable impact from discounting. This was partially offset by higher claims inflation and a less favorable run off result. The expense ratio improved by 0.2 percentage points to 24.8 percent (25.0 percent).
Life/Health insurance: Strong operating profit
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