Allianz Increases Operating Profit by Almost a Quarter to 3.7 Billion Euros
EARNINGS RELEASE: 1Q 2023
This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20230511005669/en/
Oliver Bäte, Chief Executive Officer of Allianz SE (Photo: Allianz SE)
1Q 2023:
- Total business volume rises 3.9 percent to 46.0 billion euros
- Operating profit increases 24.2 percent to 3.7 billion euros; strong performance particularly in Life/Health and Property-Casualty business segments
- Shareholders’ core net income strong at 2.2 billion euros
- Strong Solvency II capitalization ratio of 206 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:
- New share buy-back program of up to 1.5 billion euros announced
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 1 January 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.
“We can be proud of our operating profit and bottom line, a reflection of our strength, our skills, and consistent execution of our strategy. We once again benefited from our diversified business mix and delivered particularly strong performance in the Property-Casualty segment, driven by robust pricing, continued underwriting discipline and focus on further productivity gains. Our strong profitability and capitalization underscore our aspiration to remain the trusted partner for our clients to secure their futures as they continue to navigate a time of hesitation and uncertainty.”
- Oliver Bäte, Chief Executive Officer of Allianz SE
FINANCIAL HIGHLIGHTS |
Total business volume
1Q 2023: Total business volumes rose by 3.9 percent to 46.0 billion euros, driven by the Property-Casualty business segment which benefited from higher prices and volumes. This result was partly offset by lower business volumes in the Life/Health business segment, primarily due to softer single-premium volumes, and 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 3.5 percent, driven by the Property-Casualty business segment.
Earnings
1Q 2023: Operating profit jumped 24.2 percent to 3.7 (1Q 2022: 3.0) 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 reduced AuM-driven revenues and a higher cost-income ratio.
Shareholders’ core net income was strong at 2.2 (1Q 2022: 0.4) billion euros due to both 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 2.0 (1Q 2022: 0.5) billion euros, up substantially in part due to the aforementioned provision.
Core Earnings per Share (EPS)3 was 5.43 (1Q 2022: 1.02) euros.
The annualized Core Return on Equity (RoE)3 was 15.6 percent (full year 2022: 12.7 percent).
On May 10, 2023, Allianz has announced a new share buy-back program of up to 1.5 billion euros. The program shall start end-May 2023 and be finalized by December 31, 2023, at the latest.
3 EPS and RoE calculation based on shareholder‘s core net income
Solvency II Capitalization Ratio
The Solvency II capitalization ratio was 206 percent at the end of 1Q 2023 compared with 201 percent at the end of 4Q 2022. Including the application of transitional measures for technical provisions, the Solvency II capitalization ratio was 232 percent at the end of the first quarter of 2023 compared with 230 percent at the end of 2022.
SEGMENTAL HIGHLIGHTS |
”Allianz’s first quarter results demonstrated strong performance and proven resilience across all segments. With the first-time application of IFRS 9 and 17, we delivered our results with even more clarity and transparency and proved our ability to create value.
- Our Property-Casualty business showed excellent internal growth, driven by healthy pricing that contributed to offset the impact of inflation. The significant increase in operating profit is due to our strict underwriting discipline and focus on productivity gains.
- Value creation in our Life/Health business is strong. Our profitability is well supported by the solidity of our in-force business as well as the robustness of new business value.
- Our active Asset Management recorded 14.9 billion euros net inflows and our third-party assets under management reached 1.7 trillion euros. This bodes well for a solid profitability development.
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: dynamic growth
1Q 2023: Total business volume rose by 11.2 percent to 24.1 (21.7) billion euros. Adjusted for foreign currency translation and consolidation effects, internal growth was strong at 11.1 percent due to a volume effect of 5.0 percent, a price effect of 5.6 percent as well as a service effect of 0.5 percent. The main contributors to the increase were AGCS, Türkiye, Allianz Partners and Germany.
Operating profit surged by 22.7 percent to 1.9 (1.5) billion euros, due to a higher operating insurance service result that was partly offset by a slightly lower operating investment result.
The combined ratio improved by 1.9 percentage points to 91.9 percent (93.8 percent). The loss ratio benefited from a higher discounting effect and lower claims from natural catastrophes. This was partly offset by a lower run-off result. The expense ratio improved by 0.5 percentage points to 24.9 percent (25.4 percent).
Life/Health insurance: Excellent new business margin
1Q 2023: PVNBP, the present value of new business premiums amounted to 18.5 (21.1) billion euros, driven primarily by lower single premium volumes in Germany and Italy, slightly offset by increased volumes in the United States as a result of a fixed index annuities sales promotion. Further decreases in Germany were driven by economic impacts, primarily higher discounting on recurring premiums.
Operating profit increased to 1.3 (0.8) billion euros and benefited in particular from a higher result in the United States. The release of the Contractual Service Margin (CSM) was stable and in line with expectations.
Contractual Service Margin (CSM) at 52.4 billion euros, up by 0.2 billion euros from the end of 2022. Healthy value of new business and the expected in-force return resulted in solid normalized growth of 1.1 percent in the first quarter.
The new business margin (NBM) increased to 5.5 percent (4.9 percent), driven by an improved business mix and higher interest rates. The value of new business (VNB) was stable at 1.0 (1.0) billion euros.
Asset Management: Positive net inflows
1Q 2023: Operating revenues were 1.9 billion euros, down by 8.1 percent. Higher performance fees were more than offset by lower AuM-driven revenues.
Operating profit was 723 (832) million euros, down 13.2 percent from the prior-year period. Adjusted for foreign currency translation effects, operating profit decreased by 16.0 percent. The cost-income ratio (CIR) rose to 62.0 percent (59.7 percent).
Third-party assets under management were 1.668 trillion euros as of March 31, 2023, up by 33 billion euros from the end of 2022. Positive net inflows of 14.9 billion euros and favorable market impacts of 42.2 billion euros were partially offset by negative foreign currency translation effects of 23.4 billion euros.
Total assets under management were 2.174 trillion euros at the end of the first quarter of 2023, reflecting the trend in the third-party assets under management.
1Q 2023 RESULTS TABLE |
Allianz Group - key figures 1st quarter 2023
|
|
|
1Q 2023 |
1Q 2022 |
Delta |
|
Total business volume |
€ bn |
46.0 |
44.3 |
3.9% |
||
- Property-Casualty |
€ bn |
24.1 |
21.7 |
11.2% |
||
- Life/Health |
€ bn |
20.1 |
20.6 |
-2.6% |
||
- Asset Management |
€ bn |
1.9 |
2.1 |
-8.1% |
||
- Consolidation |
€ bn |
-0.2 |
-0.1 |
4.6% |
||
Operating profit / loss |
€ mn |
3,731 |
3,004 |
24.2% |
||
- Property-Casualty |
€ mn |
1,872 |
1,526 |
22.7% |
||
- Life/Health |
€ mn |
1,320 |
806 |
63.8% |
||
- Asset Management |
€ mn |
723 |
832 |
-13.2% |
||
- Corporate and Other |
€ mn |
-176 |
-201 |
-12.3% |
||
- Consolidation |
€ mn |
-7 |
42 |
n.m. |
||
Net income |
€ mn |
2,160 |
585 |
269% |
||
- attributable to non-controlling interests |
€ mn |
128 |
111 |
15.3% |
||
- attributable to shareholders |
€ mn |
2,032 |
474 |
329% |
||
Shareholders’ core net income1 |
€ mn |
2,173 |
417 |
421% |
||
Core earnings per share2 |
€ |
5.43 |
1.02 |
431% |
||
Additional KPIs |
|
|
|
|
|
|
- Group |
Core return on equity3 |
% |
15.6% |
12.7% |
2.9% |
|
- Property-Casualty |
Combined ratio |
% |
91.9% |
93.8% |
-1.9% |
|
- Life/Health |
New business margin |
% |
5.5% |
4.9% |
0.6% |
|
- Asset Management |
Cost-income ratio |
% |
62.0% |
59.7% |
2.2% |
|
|
|
|
|
03/31/2023 |
12/31/2022 |
Delta |
Shareholders' equity4 |
€ bn |
56.8 |
54.4 |
4.3% |
||
Contractual service margin (net) |
€ bn |
32.1 |
31.7 |
1.2% |
||
Solvency II capitalization ratio5 |
% |
206% |
201% |
5% |
||
Third-party assets under management |
€ bn |
1,668 |
1,635 |
2.0% |
1_Presents the portion of shareholders’ net income before non-operating market movements and before amortization of specific/certain acquisition-related intangible assets (including any related tax effects).
2_Calculated by dividing the respective period’s shareholders' core net income, adjusted for net financial charges related to undated subordinated bonds classified as shareholders' equity, by the weighted average number of shares outstanding (basic core EPS).
3_Represents the annualized ratio of shareholders’ core net income to the average shareholders’ equity at the beginning and at the end of the period. Shareholders’ core net income is adjusted for net financial charges related to undated subordinated bonds classified as shareholders’ equity. From the average shareholders’ equity undated subordinated bonds classified as shareholders’ equity and net OCI are excluded. Annualized figures are not a forecast for full year numbers. For 1Q 2022, the core return on equity for the respective full year is shown.
4_Excluding non-controlling interests.
5_Risk capital figures are group diversified at 99.5% confidence level. Including the application of transitional measures for technical provisions, the Solvency II capitalization ratio is 232% as of 31 March 2023.
Glossary
Total business volume: Total business volume presents a measure for the overall amount of business generated during a specific reporting period. Total business volume in the Allianz Group comprises: Gross premiums written as well as fee and commission income in Property-Casualty ; Statutory gross premiums written in Life/Health; and Operating revenues in Asset Management.
The definition of total business volume is comparable to the definition of total revenues previously used in Allianz Group. The revenues from our banking business, however, are no longer part of the total business volume anymore as the remaining banking activities can be considered immaterial.
Shareholders’ core net income: Presents the portion of shareholders’ net income before non-operating market movements and before amortization of specific/certain acquisition-related intangible assets (including any related tax effects).
Operating insurance service result: Presents in profit or loss insurance revenue, insurance service expenses including incurred claims and other incurred insurance service expenses as well as the reinsurance service result. The following components are also included by Allianz: 1) Non-attributable acquisition, administrative and claims expenses of our operating entities which under IFRS 4 were also included in the underwriting result; 2) Adjustments for claims and expense variances where our operating entities share the technical results with the policyholders (only for insurance contracts under the variable fee approach); 3) Restructuring expenses that are shared with the policyholder.
Annualized Core Return on Equity (RoE): Represents the annualized ratio of shareholders’ core net income to the average shareholders' equity at the beginning and at the end of the period. Shareholders’ core net income is adjusted for net financial charges related to undated subordinated bonds classified as shareholders’ equity. From the average shareholders’ equity undated subordinated bonds classified as shareholders’ equity and net OCI (“Other comprehensive income“) are excluded.
Combined ratio: Represents the total of acquisition and administrative expenses, claims and insurance benefits incurred, and the reinsurance result divided by insurance revenue.
Contractual Service Margin (CSM): Balance sheet liability, containing deferred discounted future profits of in-force long duration business.
RELATED LINKS |
Media Conference
May 12, 2023, 11:00 AM CEST: YouTube English line
Analyst Conference
May 12, 2023, 1:30 PM CEST: YouTube English line
Results
The results and related documents can be found in the download center .
IFRS 9/17
More details about the new accounting standards IFRS 9 and 17 can be found here .
UPCOMING EVENTS |
Financial Results 2Q 2023
August 10, 2023
More information can be found in the financial calendar .
About Allianz
The Allianz Group is one of the world's leading insurers and asset managers with more than 122 million* private and corporate customers in more than 70 countries. Allianz customers benefit from a broad range of personal and corporate insurance services, ranging from property, life and health insurance to assistance services to credit insurance and global business insurance. Allianz is one of the world’s largest investors, managing around 717 billion euros** on behalf of its insurance customers. Furthermore, our asset managers PIMCO and Allianz Global Investors manage about 1.7 trillion euros** of third-party assets. Thanks to our systematic integration of ecological and social criteria in our business processes and investment decisions, we are among the leaders in the insurance industry in the Dow Jones Sustainability Index. In 2022, over 159,000 employees achieved total revenues of 152.7 billion euros and an operating profit of 14.2 billion euros for the group***.
* Including non-consolidated entities with Allianz customers.
** As of March 31, 2023.
*** As reported – not adjusted to reflect the application of IFRS 9 and IFRS 17.
These assessments are, as always, subject to the disclaimer provided below.
Cautionary note regarding forward-looking statements
This document includes forward-looking statements, such as prospects or expectations, that are based on management's current views and assumptions and subject to known and unknown risks and uncertainties. Actual results, performance figures, or events may differ significantly from those expressed or implied in such forward-looking statements.
Deviations may arise due to changes in factors including, but not limited to, the following: (i) the general economic and competitive situation in the Allianz’s core business and core markets, (ii) the performance of financial markets (in particular market volatility, liquidity, and credit events), (iii) adverse publicity, regulatory actions or litigation with respect to the Allianz Group, other well-known companies and the financial services industry generally, (iv) the frequency and severity of insured loss events, including those resulting from natural catastrophes, and the development of loss expenses, (v) mortality and morbidity levels and trends, (vi) persistency levels, (vii) the extent of credit defaults, (viii) interest rate levels, (ix) currency exchange rates, most notably the EUR/USD exchange rate, (x) changes in laws and regulations, including tax regulations, (xi) the impact of acquisitions including and related integration issues and reorganization measures, and (xii) the general competitive conditions that, in each individual case, apply at a local, regional, national, and/or global level. Many of these changes can be exacerbated by terrorist activities.
No duty to update
Allianz assumes no obligation to update any information or forward-looking statement contained herein, save for any information we are required to disclose by law.
Other
The figures regarding the net assets, financial position and results of operations have been prepared in conformity with International Financial Reporting Standards. This Quarterly Earnings Release is not an Interim Financial Report within the meaning of International Accounting Standard (IAS) 34.
This is a translation of the German Quarterly Earnings Release of the Allianz Group. In case of any divergences, the German original is binding.
Privacy Note
Allianz SE is committed to protecting your personal data. Find out more in our privacy statement.
To view this piece of content from cts.businesswire.com, please give your consent at the top of this page.
View source version on businesswire.com: https://www.businesswire.com/news/home/20230511005669/en/
Contact information
For further information, please contact:
Holger Klotz
Tel. +49 89 3800 90921
email: holger.klotz@allianz.com
Fabrizio Tolotti
Tel. +49 151 59956396
email: fabrizio.tolotti@allianz.com
Johanna Oltmann
Tel. +49 89 3800 13346
email: johanna.oltmann@allianz.com
About Business Wire
For more than 50 years, Business Wire has been the global leader in press release distribution and regulatory disclosure.
Subscribe to releases from Business Wire
Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from Business Wire
Daiichi Sankyo Shines a Light on Inequalities and Unmet Needs in Care as Part of Its Commitment to People With Cardiovascular Disease31.8.2024 18:00:00 EEST | Press release
Daiichi Sankyo Europe, (hereafter, Daiichi Sankyo) today announced its reinforced commitment to addressing key unmet needs and barriers in cardiovascular (CV) care, by shining a light on inequalities in treatment and outcomes experienced by various patient groups. The announcement follows the presentation of data from sub-analyses of the SANTORINI observational study and ETNA-AF (Edoxaban Treatment in routiNe clinical prActice in patients with nonvalvular Atrial Fibrillation) study programme, at the European Society of Cardiology (ESC) Congress 2024. Gender inequalities in CV disease treatment and LDL-C goal attainment Raised low-density lipoprotein cholesterol (LDL-C) is a key modifiable contributor to risk of cardiovascular major events. It has been shown that for every 1 mmol/L reduction in LDL-C, there is a 22% reduction in major cardiovascular events after 1 year.7,8 Female patients in Europe who are at high or very high CV risk were undertreated and less achieved guideline-recomm
Suzano completes purchase of 15% stake in Lenzing AG31.8.2024 01:40:00 EEST | Press release
Suzano, the world's largest pulp producer, today announces the completion of its acquisition of a 15% stake in Lenzing AG, the Vienna-listed leading global supplier of sustainable premium cellulosic fibres for the textile and non-wovens industry, from B&C Group. As announced in June this year, the transaction value is EUR 230 million (or EUR 39.70 per share). The agreement was subject to regulatory approval, which was granted without restrictions. The long-term partnership between Suzano and B&C Group establishes that Suzano has the right to hold two seats on Lenzing’s Board and the option to acquire an additional 15% stake from B&C Group until the end of 2028. Following the sale of the 15% stake, B&C Group now holds 37.25% of Lenzing’s share capital. Lenzing is a leading global supplier of premium wood-based cellulosic fibers (lyocell, modal, and viscose) for the production of clothing, home textiles, hygiene products, and non-woven materials. Beto Abreu, CEO of Suzano, said: “Lenzing
Ant International Collaborates with Brazilian Partners to Drive Financial Inclusion with Innovative Credit Tech Solutions30.8.2024 21:46:00 EEST | Press release
Ant International, a digital payment and financial technology leader, today announced its strategic initiative to provide AI-driven credit technology solutions designed to empower local partners and advance financial inclusions in Brazil. As a major milestone, Ant International has formed a strategic partnership with Dock, a leader in payments and banking technology in Latin America. This collaboration aims to enhance the credit management capability and infrastructure efficiency for Dock’s clients, which include financial institutions, retailers, fintech start-ups, etc. The shared vision is to make credit services more inclusive for market segments that are currently insufficiently served, such as micro, small and medium-sized enterprises (MSMEs). In the initial phase of the collaboration, Ant International’s AI-driven credit tech solutions, including an automated and intelligent risk management engine, will be explored for integration into Dock One platform. This initiative aims to s
Wipro Appoints Srikumar Rao as Global Head of Its Engineering Edge Business Line30.8.2024 17:20:00 EEST | Press release
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading technology services and consulting company, today announced the appointment of Srikumar Rao as Global Head of its Engineering Edge Business Line, effective from October 5, 2024. Srikumar succeeds Harmeet Chauhan, who is stepping down to pursue opportunities outside the organization. Srikumar will report to Srini Pallia. Srikumar has been with Wipro for 26 years and has grown with the organization, serving in various leadership roles. He was most recently the Chief Operating Officer (COO) of Wipro Engineering Edge (WEE) and Global Practice Head of Embedded Systems. His work has spanned several markets, selling and delivering specialized Engineering, Research, and Development (ER&D) services to Software & Internet, Semiconductor, Automotive, Manufacturing, and Communications clients. In his new role, Srikumar will continue to scale and strengthen Wipro’s engineering prowess. He will also be responsible for defining the vision
Alnylam Presents Detailed Results from the Positive HELIOS-B Phase 3 Study of Vutrisiran▼ in Patients with ATTR Amyloidosis with Cardiomyopathy at the European Society of Cardiology Congress30.8.2024 13:00:00 EEST | Press release
Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY), the leading RNAi therapeutics company, today announced detailed results from the HELIOS-B Phase 3 study of vutrisiran, an investigational RNAi therapeutic in development for the treatment of ATTR amyloidosis with cardiomyopathy (ATTR-CM). The data were presented today in a Hot Line session at the European Society of Cardiology (ESC) Congress 2024, taking place August 30-September 2 in London, United Kingdom. Results from the HELIOS-B study were also simultaneously published in TheNew England Journal of Medicine. As previously reported, the HELIOS-B study met all 10 of its primary and secondary endpoints, across both the overall and monotherapy populations, with statistical significance. Enrolled patients were predominantly New York Heart Association (NYHA) Class I or II with wild-type disease and had been diagnosed by non-invasive methods, with substantial concurrent treatment with available standard of care treatments such as tafamidis and
In our pressroom you can read all our latest releases, find our press contacts, images, documents and other relevant information about us.
Visit our pressroom