Allianz SE · XETR:ALV
Allianz — Q3 2022 Earnings Presentation
52 slides from Allianz's earnings presentation, Nov 10, 2022
Slide 1: Group financial results 2022
Group financial results 2022 Allianz Investor Relations App Apple App Store Google Play Store © Allianz 2022 Munich November 10, 2022
Slide 2: Content/topics
Content/topics Group financial results 1 3Q 2022 Additional information 2 Glossary Disclaimer
Slide 3: Group 9M: EUR 10bn operating profit
GROUP FINANCIAL RESULTS 3Q 2022 Group 9M: EUR 10bn operating profit Group Property-Casualty Life/Health Asset Management Total revenues 9M 22 in EUR bn (internal growth vs. prior year in %) 116.0 (+1.6%) 53.8 (+8.8%) 56.6 (-3.6%) 6.1 (-4.6%) Operating profit 9M 22 in EUR mn (vs. prior year in %) 10,
Slide 4: Group 9M: EUR 10bn operating profit
GROUP FINANCIAL RESULTS 3Q 2022 Group 9M: EUR 10bn operating profit Comments • Outlook 2022: OP in the upper half of target range • P/C – very strong performance For the full year, Allianz expects to arrive in the upper half Operating profit up 14% driven by improvements in of its operating profit t
Slide 5: Group 3Q: operating profit up 7% to EUR 3.5bn
GROUP FINANCIAL RESULTS 3Q 2022 Group 3Q: operating profit up 7% to EUR 3.5bn Group Property-Casualty Life/Health Asset Management Total revenues 3Q 22 in EUR bn (internal growth vs. prior year in %) 34.8 (-3.7%) 16.1 (+8.8%) 16.8 (-12.6%) 2.1 (-10.1%) Operating profit 3Q 22 in EUR mn (vs. prior yea
Slide 6: Group 3Q: operating profit up 7% to EUR 3.5bn
GROUP FINANCIAL RESULTS 3Q 2022 Group 3Q: operating profit up 7% to EUR 3.5bn Comments • Total revenue growth at 1.3% • P/C – excellent performance Strong internal growth in P/C (+8.8%). Consolidation Operating profit up 32%. Underwriting result (∆ EUR +0.2bn) (+0.7%) and F/X (+4.3%). driven by orga
Slide 7: Group: solvency ratio at comfortable level
GROUP FINANCIAL RESULTS 3Q 2022 Group: solvency ratio at comfortable level Shareholders’ equity (EUR bn) Key sensitivities (EUR bn) -7.9% Equity markets -30% -4.5 Unrealized 80.0 gains/losses1 17.7 56.4 20.0 51.9 22.6 +50bps -4.3 16.8 Interest rate Retained earnings, -50bps +4.1 F/X and undated 27.4
Slide 8: Group: solvency ratio at comfortable level
GROUP FINANCIAL RESULTS 3Q 2022 Group: solvency ratio at comfortable level Comments • Shareholders’ equity • SII ratio In 3Q 2022, shareholders’ equity decreases by Decrease by 1%-p to 199%. Main drivers: EUR 4.4bn. Main drivers are: + 7%-p organic capital generation (+5%-p after tax, +2%-p − EUR 7.
Slide 9: Group: capital generation at 7%-p
GROUP FINANCIAL RESULTS 3Q 2022 Group: capital generation at 7%-p Own funds 86.0 +3.7 82.4 (EUR bn) 81.2 -0.5 -3.0 -1.2 +1.8 -0.2 +1.5 +0.8 81.9 81.5 -0.4 82.6 81.4 81.2 P/C AM L/H CO/Conso. 31.12.21 30.06.22 30.06.2022 Regulatory/ Regulatory Operating SII SII Market Market impact Capital Capital mg
Slide 10: Group: capital generation at 7%-p
GROUP FINANCIAL RESULTS 3Q 2022 Group: capital generation at 7%-p Comments • 7%-p SII capital generation pre-tax/dividend • Capital management/management actions Net of tax +5%-p, after tax and normalized dividend +5%-p impact from de-risking measures and duration +2%-p. management, -4%-p impact fro
Slide 11: P/C: excellent internal growth momentum
GROUP FINANCIAL RESULTS 3Q 2022 P/C: excellent internal growth momentum EUR mn Revenues Rate change on renewals 3Q 22 Total growth Internal growth 9M 22 12M 21 ∆ p.y. ∆ p.y. Total P/C segment 16,112 +14.2% +8.8% +4.3% +3.6% Selected OEs Germany 2,348 +5.1% +5.1% +3.2% +2.0% United Kingdom 1,239 +4.2
Slide 12: P/C: excellent internal growth momentum
GROUP FINANCIAL RESULTS 3Q 2022 P/C: excellent internal growth momentum Comments • Internal growth at 8.8% mainly driven by price • CEE – good growth across the region Price (+6.7%), volume (+1.7%) and service fees (+0.4%) Romania, Austria and Czech Republic main contributors. contribute to internal
Slide 13: P/C: operating profit up 32%
GROUP FINANCIAL RESULTS 3Q 2022 P/C: operating profit up 32% Operating profit drivers (EUR mn) Combined ratio (in %) +32.0% -0.7%-p +227 1,700 94.7 94.0 Loss ratio 68.0 67.4 +193 -7 4.9 2.1 NatCat impact2 (in %-p) 1,287 -2.8 -4.3 Run-off ratio3 (in %-p) Expense ratio 26.7 26.6 3Q 21 3Q 22 Combined r
Slide 14: P/C: operating profit up 32%
GROUP FINANCIAL RESULTS 3Q 2022 P/C: operating profit up 32% Comments • Operating profit up 32% • Expense ratio – very good level Higher OP driven by better underwriting and investment Lower admin expenses due to productivity initiatives result. CR improves -0.7%-p as lower NatCat and positive suppo
Slide 15: P/C: operating profit at EUR 1.7bn
GROUP FINANCIAL RESULTS 3Q 2022 P/C: operating profit at EUR 1.7bn EUR mn Operating profit Combined ratio NatCat impact on CR 3Q 22 ∆ p.y. 3Q 22 ∆ p.y. 3Q 22 ∆ p.y. Total P/C segment 1,700 +32.0% 94.0% -0.7%-p 2.1%-p -2.8%-p Selected OEs Germany 393 +128.1% 90.6% -7.4%-p 1.3%-p -13.0%-p United Kingd
Slide 16: P/C: operating profit at EUR 1.7bn
GROUP FINANCIAL RESULTS 3Q 2022 P/C: operating profit at EUR 1.7bn Comments • Germany – very strong profitability • LatAm – driven by Brazil Lower NatCat impact partially offset by weather related OP impacted by deterioration of Brazilian motor business and large losses as well as higher underlying
Slide 17: P/C: investment income rises sharply
GROUP FINANCIAL RESULTS 3Q 2022 P/C: investment income rises sharply Operating investment result1 Current yield Economic reinvestment yield (EUR mn) (debt securities; in %) (debt securities; in %) +36.4% 0.65 3.5 850 0.53 623 1.3 3Q 21 3Q 22 3Q 21 3Q 22 3Q 21 3Q 22 Total average asset base4 Duration
Slide 18: P/C: investment income rises sharply
GROUP FINANCIAL RESULTS 3Q 2022 P/C: investment income rises sharply Comments • Interest & similar income • Reinvestment yield Driven by surge in income from debt due to Economic reinvestment yield rises to 3.5% in line with market inflation-linked bonds and increase in yields as well as development
Slide 19: L/H: NBM excellent at 4.0%
GROUP FINANCIAL RESULTS 3Q 2022 L/H: NBM excellent at 4.0% PVNBP share by line EUR mn 3Q 21 3Q 22 ∆ p.y. PVNBP 19,655 13,745 -30.1% Total L/H segment 3.4 4.0 APE 1,809 1,592 -12.0% Single premium 10,928 9,083 -16.9% 17% 6.5 Recurring premium 716 684 -4.4% Protection & health 4.6 31% 21% 2.7 PVNBP by
Slide 20: L/H: NBM excellent at 4.0%
GROUP FINANCIAL RESULTS 3Q 2022 L/H: NBM excellent at 4.0% Comments PVNBP by line PVNBP by OE • High prior year level • Germany Life – share of preferred lines at 87% High prior year level due to one large contract in corporate Decline of PVNBP mainly due to higher discount rates and business (EUR ~
Slide 21: L/H: solid result in volatile markets
GROUP FINANCIAL RESULTS 3Q 2022 L/H: solid result in volatile markets Operating profit by source (EUR mn) Operating profit by line (EUR mn) -16.5% -16.5% +58 1,252 1,252 +21 233 1,045 +24 1,045 -208 148 272 -101 349 179 290 522 304 Operating Loadings Investment Technical Expenses Impact of Operating
Slide 22: L/H: solid result in volatile markets
GROUP FINANCIAL RESULTS 3Q 2022 L/H: solid result in volatile markets Comments • Operating profit at EUR 1.0bn Operating profit by line Decline driven by lower contribution from Germany Life • Protection & health and USA. Aviva Poland acquisition contributes EUR 57mn. Driven by consolidation of Aviv
Slide 23: L/H: value of new business at good level
GROUP FINANCIAL RESULTS 3Q 2022 L/H: value of new business at good level EUR mn Value of new business New business margin Operating profit 3Q 22 ∆ p.y. 3Q 22 ∆ p.y. 3Q 22 ∆ p.y. Total L/H segment 550 -17.3% 4.0% +0.6%-p 1,045 -16.5% USA 151 +2.3% 3.9% +0.1%-p 171 -42.8% Germany Life 135 +0.2% 4.1% +
Slide 24: L/H: value of new business at good level
GROUP FINANCIAL RESULTS 3Q 2022 L/H: value of new business at good level Comments New business Operating profit • High prior year level • Germany Life – lower investment margin High prior year level due to a large corporate contract at Decline of investment margin driven by harvesting result. Allian
Slide 25: L/H: investment margin at 17bps
GROUP FINANCIAL RESULTS 3Q 2022 L/H: investment margin at 17bps Investment margin Economic reinvestment yield 3Q 21 3Q 22 (debt securities; in %) 4.0 Based on Ø book value of assets1,2 (EUR bn) 645 541 1.8 Current yield3 0.75% 0.92% Based on Ø aggregate policy reserves4 (EUR bn) 513 512 3Q 21 3Q 22
Slide 26: L/H: investment margin at 17bps
GROUP FINANCIAL RESULTS 3Q 2022 L/H: investment margin at 17bps Comments • Investment margin declines by EUR -208mn • Net harvesting and other Decline driven by lower results from Germany Life and Decrease mainly due to lower harvesting result driven by U.S., the latter impacted by the U.S. back-boo
Slide 27: AM: PIMCO 3rd party AuM stable
GROUP FINANCIAL RESULTS 3Q 2022 AM: PIMCO 3rd party AuM stable Total assets under management1 (EUR bn) 3rd party AuM split1 (EUR bn) Asset classes Regions Multi-assets Europe EUR 173bn (-5.8%) EUR 543bn (-3.8%) -3.2% 2,609 Equities Asia Pacific EUR 138bn (-13.0%) EUR 270bn (+23.1%) 2,319 Allianz Gro
Slide 28: AM: PIMCO 3rd party AuM stable
GROUP FINANCIAL RESULTS 3Q 2022 AM: PIMCO 3rd party AuM stable Comments • Markets drive total AuM • Business highlights Total AuM 3% below the level end of 2Q 2022 driven by Investment performance: 79% of 3rd party AuM outperform adverse market effects, transfer of AllianzGI U.S. assets benchmarks o
Slide 29: AM: 3rd party AuM at EUR 1.7tn
GROUP FINANCIAL RESULTS 3Q 2022 AM: 3rd party AuM at EUR 1.7tn 3rd party assets under management development1 (EUR bn) 3rd party net flow split1 (EUR bn) -2.5% Asset Fixed income -16.4 classes Equities -6.1 1,769 +73.5 1,726 Multi-assets +1.1 -4.9 -15.1 -97.0 Alternatives +1.4 Regions America -16.2
Slide 30: AM: 3rd party AuM at EUR 1.7tn
GROUP FINANCIAL RESULTS 3Q 2022 AM: 3rd party AuM at EUR 1.7tn Comments • 3rd party AuM down 2% to EUR 1.7tn • 3rd party net flows PIMCO: EUR -15bn 3rd party AuM decrease by EUR 43bn driven by market 3rd party net outflows mainly stem from fixed income. effects (EUR -97bn), asset reduction related t
Slide 31: AM: revenues resilient
GROUP FINANCIAL RESULTS 3Q 2022 AM: revenues resilient Revenues development (EUR mn) PIMCO (EUR mn) AllianzGI (EUR mn) -1.4% +3.3% -13.5% Internal growth -10.1% -11.5% -7.3% 1,516 Performance fees 2,085 2,055 1,467 19 AuM driven & 83 55 29 617 other revenues1 54 534 36 2,002 1,999 1,438 1,496 563 49
Slide 32: AM: revenues resilient
GROUP FINANCIAL RESULTS 3Q 2022 AM: revenues resilient Comments • Segment revenues – resilient • PIMCO margin – up 1.0bps Excluding F/X, revenues decrease mainly due to lower Margin benefits from a higher number of fee days. average 3rd party AuM and due to lower performance fees. • AllianzGI margin
Slide 33: AM: operating profit at EUR 0.8bn
GROUP FINANCIAL RESULTS 3Q 2022 AM: operating profit at EUR 0.8bn Operating profit drivers (EUR mn) PIMCO -10.2% -2.2% -15.5% Internal growth 628 614 8821 7921 40 +85 +77 16 Performance fee impact2 57.2 59.5 CIR (in %) OP excl. performance -252 fee impact2 842 -7.8% fee impact2 3Q 21 3Q 22 776 57.7
Slide 34: AM: operating profit at EUR 0.8bn
GROUP FINANCIAL RESULTS 3Q 2022 AM: operating profit at EUR 0.8bn Comments • Segment – OP at EUR 0.8bn • AllianzGI – OP down 32% OP of EUR 792mn at 23% of FY outlook midpoint. OP at EUR 178mn, driven by lower revenues and Excluding F/X, lower AuM driven revenues and Voya-related impacts. performance
Slide 35: CO: strong improvement
GROUP FINANCIAL RESULTS 3Q 2022 CO: strong improvement Operating result development and components +21 +113 -4 -60 -4 -186 -67.7% Operating Holding & Banking Alternative Consoli- Operating result Treasury Investments dation result 3Q 21 3Q 22 ∆ 3Q 22/21 3Q 22 -89 13 24 -8 3Q 21 -202 18 3 -5 35
Slide 36: CO: strong improvement
GROUP FINANCIAL RESULTS 3Q 2022 CO: strong improvement Comments • Higher investment income Lower operating loss mainly due to higher investment income, driven by inflation-linked bonds and dividends, all reflected in results from Holding & Treasury and Alternative Investments. 36
Slide 37: Group: shareholders' net income at EUR 2.5bn
GROUP FINANCIAL RESULTS 3Q 2022 Group: shareholders’ net income at EUR 2.5bn EUR mn 3Q 21 3Q 22 p.y. Operating profit 3,236 3,476 +240 Non-operating items -287 -120 +167 Realized gains/losses (net) 159 656 +497 Impairments (net) -89 -293 -204 Income from financial assets and liabilities carried at
Slide 38: Group: shareholders' net income at EUR 2.5bn
GROUP FINANCIAL RESULTS 3Q 2022 Group: shareholders’ net income at EUR 2.5bn Comments • Shareholders’ net income grows 16.7% to EUR 2.5bn • Tax rate supported by tax exempted investment income Increase equally driven by operating profit (∆ EUR +0.2bn) • Sale of majority stake in Russian operations a
Slide 39: Summary – OP in the upper half of target range
GROUP FINANCIAL RESULTS 3Q 2022 Summary – OP in the upper half of target range1 116.0bn 10.2bn 13.4bn +/- 1bn OP expected in upper Facts Revenues Operating profit half of target range1 and figures 9M 2022 (EUR) 4.7bn 199% 2.0bn Shareholders’ Solvency II ratio Share buy-backs net income 1) For the fu
Slide 40: Content/topics
Content/topics Group financial results 1 3Q 2022 Additional information 2 Glossary Disclaimer
Slide 41: Allianz track record
ADDITIONAL INFORMATION Allianz track record Operating profit 2021: EUR 13.4bn Investment portfolio 2021: EUR 808.5bn By segments1 By regions1 Asset allocation Debt instruments by rating6 Debt instruments 83% AAA 18% P/C Insurance 40% Germany 24% • Government 36% AA 24% L/H Insurance 35% W&S Europe 2
Slide 42: Content/topics
Content/topics Group financial results 1 3Q 2022 Additional information 2 Glossary Disclaimer
Slide 43: Glossary (1)
GLOSSARY Glossary (1) AFS Available for sale: Available-for-sale investments are non-derivative financial assets which have been acquired neither for sale in the near term nor to be held to maturity. They are shown at fair value on the balance sheet. AGCS Allianz Global Corporate & Specialty Allianz
Slide 44: Glossary (2)
GLOSSARY Glossary (2) Bps Basis points: 1 Basis point = 0.01%. CEE Central and Eastern Europe CIR Cost-income ratio: Operating expenses divided by operating revenues CO (The Allianz business segment) Corporate and Other CR Combined ratio: Represents the total of acquisition and administrative expens
Slide 45: Glossary (3)
GLOSSARY Glossary (3) FV Fair value: The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FVO Fair-value option: Financial assets and liabilities designated at fair value through income are me
Slide 46: Glossary (4)
GLOSSARY Glossary (4) L/H (The Allianz business segment) Life and Health insurance L/H lines of business Guaranteed savings & annuities: Life insurance products linked to life expectancy, offering life and / or death benefits in the form of single or multiple payments to beneficiaries and possibly i
Slide 47: Glossary (5)
GLOSSARY Glossary (5) LoB Line of business LR Loss ratio: Represents claims and insurance benefits incurred (net), divided by premiums earned (net). The calendar year (CY) loss ratio includes the results of the prior year’s reserve development in addition to the accident year (AY) loss ratio. LTC Lo
Slide 48: Glossary (6)
GLOSSARY Glossary (6) Operating SII earnings Operating SII earnings represent the change in own funds, before tax and dividend accrual, that is attributable to the Allianz Group’s ongoing core operations. As such, operating SII earnings comprise: expected return from existing business, new business
Slide 49: Glossary (7)
GLOSSARY Glossary (7) Reinsurance Insurance companies transfer parts of the insurance risk they have assumed to reinsurance companies. Retained earnings In addition to the reserve legally required in the group parent company’s financial statements, this item mainly comprises the undistributed profit
Slide 50: Glossary (8)
GLOSSARY Glossary (8) Statutory premiums Gross premiums written from the sales of life and health insurance policies, as well as gross receipts from sales of unit-linked and other investment-related products, in accordance with the statutory accounting principles applicable in the insurer’s home jur
Slide 51: Content/topics
Content/topics Group financial results 1 3Q 2022 Additional information 2 Glossary Disclaimer
Slide 52: Cautionary note regarding forward-looking statements
DISCLAIMER Cautionary note regarding forward-looking statements This document includes forward-looking state- dustry generally, (iv) the frequency and severity No duty to update ments, such as prospects or expectations, that of insured loss events, including those resulting Allianz assumes no obliga