11.11.2016
Allianz SE DE0008404005
DGAP-News: Allianz SE: 3Q net income rises 36.5 percent, supported by all business segments
DGAP-News: Allianz SE / Key word(s): Quarter Results/9-month figures
Allianz SE: 3Q net income rises 36.5 percent, supported by all business
segments
11.11.2016 / 06:59
The issuer is solely responsible for the content of this announcement.
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*Total revenues rise 0.5 percent to 27.7 billion euros in 3Q; internal
revenue growth of 1.7 percent, adjusted for currencies and consolidation
*3Q operating profit up 18.2 percent at 2.9 billion euros from year-ago
*Net income attributable to shareholders up 36.5 percent at 1.9 billion
euros in 3Q from year-ago
*Combined ratio improves to 93.5 percent in 3Q from 94.1 percent year-ago
*Operating profit in Life/Health rises 53 percent in 3Q from year-ago
*New business margin resilient at 2.8 percent in 3Q
*PIMCO third-party net flows at 4.7 billion euros in 3Q, first positive
net flows since 2Q 2013
*Cost-income ratio in Asset Management improves by 2.5 percentage points
to 60.8 percent
*Solvency II capitalization ratio at 186 percent as of September 30, 2016
*Operating profit outlook for 2016 confirmed at 10.5 billion euros, plus
or minus 500 million euros
Allianz Group, Europe's largest insurer and asset manager, saw operating
profit in the third quarter rise 18.2 percent to 2.9 billion euros, driven
by contributions from all business segments. The Life and Health segment
produced the strongest results with contributions from all large operating
entities.
Net income attributable to shareholders climbed 36.5 percent in the quarter
to 1.9 billion euros due partly to better performance across its business
segments. Property and Casualty insurance saw robust internal revenue
growth of 3.1 percent when adjusted for currency and consolidation effects.
"Efforts to develop our business in a very difficult environment are paying
off," said Dieter Wemmer, chief financial officer of Allianz SE. "We're
seeing sustainable profitable growth in many businesses. Improvements from
our Renewal Agenda are bearing fruit and keeping us on track to reach our
operating profit target for the full year of 10.5 billion euros, give or
take 500 million euros."
Key performance indicators also improved in the quarter, with the combined
ratio strengthening to 93.5 percent from 94.1 percent one year ago and the
cost-income ratio in asset management improving to 60.8 percent from 63.3
percent. In the life segment, the new business margin weakened by 0.3
percentage points to 2.8 percent on the year but improved from the second
quarter by nearly the same amount despite a decline in market rates.
Group: 9M performance keeps Allianz on track for full-year profit target
9M 2016 overview
Total revenues decreased by 3.2 percent to 92.4 billion euros for the first
nine months of 2016. Operating profit eased 1.7 percent to 8.0 billion
euros, driven by the Property and Casualty segment, and, to a lesser
extent, Asset Management. The Life and Health segment, however, posted an
increase in operating profit. The non-operating result was impacted by a
lower investment result and the classification of the South Korean business
as held for sale. Overall, net income attributable to shareholders was 5.1
billion euros, down 1.1 percent from the first nine months of 2015.
3Q revenues up 0.5%
In the third quarter of 2016, total revenues edged higher to 27.7 (previous
year: 27.5) billion euros. A decline in revenues from the Asset Management
segment was offset by revenue growth in the Life and Health segment.
3Q operating profit up 18.2% to EUR2.9bn
Operating profit grew 18.2 percent to 2.9 billion euros in the third
quarter, largely due to a higher investment margin in the Life and Health
segment. The Property and Casualty segment delivered a 4.3 percent rise in
operating profit due to stronger underwriting and investment results, while
Asset Management operating profit rose 0.5 percent.
3Q net income up 36.5%
Lower impairments and higher realized gains led to an improvement in the
non-operating result. Net income attributable to shareholders increased by
36.5 percent to 1.9 billion euros in the third quarter of the year. Basic
Earnings per Share (EPS) rose to 4.08 (2.99) euros.
Annualized RoE 12.4% in 9M
Annualized Return on Equity (RoE) was 12.4 percent for the first nine
months of the year 2016 (full year 2015: 12.5 percent). Annualized figures
are not a forecast for full-year numbers.
Solvency II capitalization ratio 186% at 30.9.2016
Solvency II capitalization ratio remained robust at 186 percent at the end
of the third quarter, demonstrating the resilience of the group despite the
current low interest rate environment.
3Q management assessment
"Allianz improved its performance in the quarter despite punishingly low
interest rates and the currency costs from Brexit," said Dieter Wemmer,
chief financial officer of Allianz SE.
Property and Casualty insurance: internal growth strong at 3.1 percent in
3Q
9M 2016 overview
In the first nine months of 2016, gross premiums written held mostly steady
at 40.4 (40.7) billion euros. Adjusted for foreign exchange and
consolidation effects, internal growth remained strong at 3.1 percent,
mostly due to positive developments in Turkey, Germany and Argentina
driving the increase. Operating profit fell 9.9 percent to 3.9 billion
euros compared to the first nine months of 2015, partly due to high claims
from natural catastrophes in the second quarter and lower investment
income. In addition, the year-ago period was supported by the net gain from
the sale of the Fireman's Fund personal insurance business. The combined
ratio was 94.4 (94.1) percent.
3Q gross premiums written hold steady
Gross premiums written held steady at 11.5 billion euros in the third
quarter in the segment. Adjusted for foreign exchange and consolidation
effects, internal growth remained strong at 3.1 percent, mostly due to
positive developments in Turkey, Allianz Worldwide Partners and Australia.
Of that, price and volume effects contributed 1.6 percent and 1.5 percent,
respectively.
3Q combined ratio improves to 93.5%
Operating profit increased by 4.3 percent to 1.4 billion euros in the third
quarter in the segment. The underwriting result benefited from a benign
natural catastrophe environment and lower large losses. The investment
result also improved after an unfavorable foreign currency result net of
hedges in the third quarter of 2015. This positive effect was partially
offset by a lower net interest result. The combined ratio improved to 93.5
(94.1) percent.
3Q management assessment
"The rate of internal growth at over 3 percent is a clear signal that the
Property and Casualty business is robust," said Dieter Wemmer, chief
financial officer of Allianz SE.
Life and Health insurance: higher investment margin drives profit growth
9M 2016 overview
In Life and Health insurance, operating profit for the first nine months of
2016 increased by 13.8 percent to 3.1 billion euros. Statutory premiums
decreased by 4.7 percent to 47.5 billion euros. The targeted shift toward
capital-efficient products lifted the new business margin to 2.6 (1.9)
percent. As a result, the value of new business (VNB) increased by 29.2
percent to 1.0 billion euros compared to the first nine months of 2015.
3Q statutory premiums up 1.6%
Statutory premiums in the third quarter increased 1.6 percent to 14.5
(14.3) billion euros, driven by higher sales of capital-efficient products
in Germany and the United States. This was partially offset by lower
unit-linked premiums in Italy and Taiwan. Adjusted for foreign exchange and
consolidation effects, statutory premiums increased by 1.5 percent.
3Q operating profit rises 53% to EUR1.1bn
Operating profit increased by 53.0 percent to 1.1 billion euros from the
third quarter of 2015 mainly due to higher investment margins in the United
States and France. In addition, operating profit in the third quarter of
2015 was burdened by loss recognition in South Korea.
VNB EUR318mn and NBM 2.8% in 3Q
The value of new business (VNB) decreased by 1.0 percent to 318 million
euros in the third quarter of 2016 compared to year-ago. Premiums shifted
to capital-efficient products due to changes in product strategy, but
unfavorable economic conditions in U.S. and European markets had a negative
effect. The new business margin decreased by 0.3 percentage points to 2.8
percent from one year ago, mainly as a result of lower interest rates, but
increased when compared to the second quarter of 2016.
3Q management assessment
"We have enjoyed a great success shifting our business mix toward capital
efficient products as reflected in a robust new business margin of 2.8
percent," said Dieter Wemmer. "Life results benefited from a stronger
investment margin in the quarter despite the historically low interest
rates seen today."
Asset Management: PIMCO attracts first positive net flows in over 3 years
9M 2016 overview
In Asset Management, third-party net outflows and negative foreign currency
translation effects were more than offset by a strong positive market
return and the acquisition of Rogge Global Partners, which together led to
a 4.0 percent increase in third-party assets under management (AuM) from
December 31, 2015. Operating profit decreased by 5.8 percent to 1.6 billion
euros in the first nine months of 2016, mainly as a result of lower margins
and lower average third-party AuM, leading to declined AuM driven revenues.
In addition, a decrease of performance fees also had a negative impact on
the operating profit. Lower operating expenses partially offset the
operating revenue decline. The cost-income ratio (CIR) improved to 64.2
(65.1) percent.
3Q operating profit EUR604mn
Operating profit edged slightly higher to 604 (600) million euros. Lower
operating expenses more than offset a decrease in third-party AuM-driven
revenues and lower performance fees. When compared to the second quarter of
this year, operating profit grew 21.2 percent.
CIR at 60.8% in 3Q
The cost-income ratio (CIR) improved by 2.5 percentage points to 60.8
percent from the year-earlier quarter, mainly due to a decrease in
personnel expenses and restructuring expenses. Both PIMCO and Allianz
Global Investors contributed to the improvement, with the latter reaching
its most efficient level of operations since the set-up of its current
structure in 2012.
3P net inflows at EUR6bn in 3Q
Compared to June 30, 2016, third-party AuM grew by 20 billion euros to
1,327 billion euros as a result of positive market effects and third-party
net inflows, partly offset by negative foreign currency translation
effects. PIMCO saw positive third-party net flows of 4.7 billion euros, the
first since the second quarter of 2013. Allianz Global Investors saw
positive third-party net flows of 1.5 billion euros, making it the
fourteenth quarter out of fifteen to see positive net flows.
3Q management assessment
"The 4.7 billion euros in positive net flows at PIMCO confirm the
attractiveness of PIMCO products," said Dieter Wemmer.
Allianz Group - key figures 3rd quarter and first nine month of 2016
3Q 2016 3Q 2015
Total revenues [Euro bn] 27.7 27.5
Property-Casualty [Euro bn] 11.5 11.5
Life/Health [Euro bn] 14.5 14.3
Asset Management [Euro bn] 1.5 1.6
Corporate and Other [Euro bn] 0.1 0.1
Consolidation [Euro bn] -0.1 -0.1
Operating profit / loss [Euro mn](1) 2,898 2,452
Property-Casualty [Euro mn] 1,410 1,352
Life/Health [Euro mn](1) 1,129 738
Asset Management [Euro mn] 604 600
Corporate and Other [Euro mn] -242 -246
Consolidation [Euro mn] -2 8
Net income [Euro mn] 1,945 1,440
attributable to non-controlling interests [Euro mn] 91 81
attributable to shareholders [Euro mn] 1,855 1,359
Basic earnings per share [Euro] 4.08 2.99
Diluted earnings per share [Euro] 4.08 2.98
Additional KPIs
Group: Return on equity (2)(3) 13.6% 12.5%
Property-Casualty: Combined ratio 93.5% 94.1%
Life/Health: New Business Margin(4) 2.8% 3.0%
Life/Health: Value of new business[Euro mn](4) 318 322
Asset Management: Cost-income ratio 60.8% 63.3%
9M 2016 9M 2015
Total revenues [Euro bn] 92.4 95.5
Property-Casualty [Euro bn] 40.4 40.7
Life/Health [Euro bn] 47.5 49.9
Asset Management [Euro bn] 4.4 4.8
Corporate and Other [Euro bn] 0.4 0.4
Consolidation [Euro bn] -0.2 -0.3
Operating profit / loss [Euro mn](1) 8,007 8,149
Property-Casualty [Euro mn] 3,949 4,382
Life/Health [Euro mn](1) 3,065 2,695
Asset Management [Euro mn] 1,565 1,661
Corporate and Other [Euro mn] -566 -577
Consolidation [Euro mn] -7 -11
Net income [Euro mn] 5,424 5,488
attributable to non-controlling interests [Euro mn] 285 290
attributable to shareholders [Euro mn] 5,139 5,198
Basic earnings per share [Euro] 11.30 11.44
Diluted earnings per share [Euro] 11.11 11.43
Additional KPIs
Group: Return on equity (2)(3) 12.4% 12.5%
Property/Casualty: Combined ratio 94.4% 94.1%
Life/Health: New Business Margin 2.6% 1.9%
Life/Health: Value of new business[Euro mn](4) 1,028 796
Asset Management: Cost-income ratio (4) 64.2% 65.1%
09/30/16 12/31/15
Shareholders' equity [Euro bn](2) 70.1 63.1
Solvency II capitalization ratio(5) 186% 200%
Third-party assets under management [Euro bn] 1,327 1,276
Please note: The figures are presented in millions of Euros, unless
otherwise stated. Due to rounding, numbers presented may not add up
precisely to the totals provided and percentages may not precisely reflect
the absolute figures.
(1) From 2Q 2016 onwards, the total result of our South Korean business is
considered as non-operating since it has been classified as "held for
sale".
(2) Excluding non-controlling interests.
(3) Excluding unrealized gains/losses on bonds net of shadow DAC. Return
on equity for 3Q 2016 and 9M 2016 is annualized. For 3Q 2015 and 9M
2015, the return on equity for the full year 2015 is shown.
Annualized figures are not a forecast for full year numbers.
(4) Current and prior year figures are presented excluding effects from
the South Korean business.
(5) Risk capital figures are group diversified at 99.5% confidence level.
Allianz Life US included based on third country equivalence with 150%
of RBC CAL since September 30, 2015. Changed regulatory tax treatment
of German life sector reduced year-end SII capitalization ratio from
200% to 196% on January 1, 2016.
These assessments are, as always, subject to the disclaimer provided below.
Cautionary note regarding forward-looking statements
The statements contained herein may include prospects, statements of future
expectations and other forward-looking statements that are based on
management's current views and assumptions and involve known and unknown
risks and uncertainties. Actual results, performance or events may differ
materially from those expressed or implied in such forward-looking
statements.
Such deviations may arise due to, without limitation, (i) changes of the
general economic conditions and competitive situation, particularly in the
Allianz Group's core business and core markets, (ii) performance of
financial markets (particularly market volatility, liquidity and credit
events), (iii) frequency and severity of insured loss events, including
from natural catastrophes, and the development of loss expenses, (iv)
mortality and morbidity levels and trends, (v) persistency levels, (vi)
particularly in the banking business, the extent of credit defaults, (vii)
interest rate levels, (viii) currency exchange rates including the
euro/US-dollar exchange rate, (ix) changes in laws and regulations,
including tax regulations, (x) the impact of acquisitions, including
related integration issues, and reorganization measures, and (xi) general
competitive factors, in each case on a local, regional, national and/or
global basis. Many of these factors may be more likely to occur, or more
pronounced, as a result of terrorist activities and their consequences.
No duty to update
The company assumes no obligation to update any information or
forward-looking statement contained herein, save for any information
required to be disclosed 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.
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11.11.2016 Dissemination of a Corporate News, transmitted by DGAP - a
service of EQS Group AG.
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Language: English
Company: Allianz SE
Königinstr. 28
80802 München
Germany
Phone: +49 (0)89 38 00 - 41 24
Fax: +49 (0)89 38 00 - 38 99
E-mail: [email protected]
Internet: www.allianz.com
ISIN: DE0008404005
WKN: 840400
Indices: DAX-30, EURO STOXX 50
Listed: Regulated Market in Berlin, Dusseldorf, Frankfurt (Prime
Standard), Hamburg, Hanover, Munich, Stuttgart; Regulated
Unofficial Market in Tradegate Exchange
End of News DGAP News Service
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