Allianz SE · XETR:ALV
Allianz — Q3 2021 Earnings Presentation
51 slides from Allianz's earnings presentation, Nov 10, 2021
Slide 1: 3Q 2021 Analyst conference call
3Q 2021 Giulio Terzariol Chief Financial Officer Analyst conference call November 10, 2021
Slide 2: Content
CONTENT 1 GROUP FINANCIAL RESULTS 3Q 2021 2 ADDITIONAL INFORMATION GLOSSARY DISCLAIMER © Allianz SE 2021
Slide 3: Group: strong 9M results across all segments
Group financial results 3Q 2021 Group: strong 9M results across all segments Group Property-Casualty Life/Health Asset Management Total revenues 9M 21 in EUR bn (internal growth vs. prior year in %) 110.1 (+6.3%) 47.7 (+2.3%) 56.8 (+8.8%) 5.9 (+15.8%) Operating profit 9M 21 in EUR mn (vs. prior year
Slide 4: Group: strong 9M results across all segments - comments
Group financial results 3Q 2021 Group: strong 9M results across all segments Comments • Internal growth strong at 6.3% • P/C – good underlying development Consolidation (+0.5%) and F/X (-1.8%) lead to total revenue OP up 19% vs. prior year driven by a better underwriting growth of 5.0%. result. CR i
Slide 5: Group: double-digit 3Q operating profit growth
Group financial results 3Q 2021 Group: double-digit 3Q operating profit growth Group Property-Casualty Life/Health Asset Management Total revenues 3Q 21 in EUR bn (internal growth vs. prior year in %) 34.4 (+9.0%) 14.1 (+7.2%) 18.3 (+9.2%) 2.1 (+16.0%) Operating profit 3Q 21 in EUR mn (vs. prior yea
Slide 6: Group: double-digit 3Q operating profit growth - comments
Group financial results 3Q 2021 Group: double-digit 3Q operating profit growth Comments • Strong internal growth of 9.0% • P/C – stable OP despite EUR 0.7bn NatCat impact Strong internal growth across all segments. Consolidation Combined ratio up 0.2%-p to 94.7%, negatively (+0.3%) and F/X (+0.1%) l
Slide 7: Group: Solvency II ratio stable at 207%
Group financial results 3Q 2021 Group: Solvency II ratio stable at 207% Shareholders’ equity (EUR bn) Key sensitivities (EUR bn) +5.1% 80.8 77.7 81.6 Equity markets -30% -5.2 Unrealized gains/losses1 22.617.7 18.0 17.6 +50bps -5.7 11.7 Retained earnings, Interest rate F/X and undated 29.227.4 30.8 2
Slide 8: Group: Solvency II ratio stable at 207% - comments
Group financial results 3Q 2021 Group: Solvency II ratio stable at 207% Comments • Shareholders’ equity • SII ratio – at a good level In 3Q 2021, shareholders’ equity increases by Main positive driver is organic capital generation EUR 3.9bn. Main drivers are (~+7%-p, ~+2.5%-p after tax and dividend)
Slide 9: Group: strong operating SII capital generation
Group financial results 3Q 2021 Group: strong operating SII capital generation +3.1 +0.8 88.6 -0.0 Own funds 85.6 +0.2 -1.0 84.9 (EUR bn) +1.4 +1.2 +0.8 -0.4 P/C AM L/H CO/Conso. 31.12.20 30.06.21 Regulatory/ Operating SII Market Capital mgmt./ Tax/ 30.09.21 model changes earnings impact management
Slide 10: Group: strong operating SII capital generation - comments
Group financial results 3Q 2021 Group: strong operating SII capital generation Comments • 7%-p SII capital generation pre-tax/dividend • Capital management/management actions SII capital generation net of tax and dividend amounts to Issuance of deeply subordinated RT1 capital contributes ~+2.5%-p in
Slide 11: P/C: internal growth strong at 7.2%
Group financial results 3Q 2021 P/C: internal growth strong at 7.2% EUR mn Revenues YTD change on renewals 3Q 21 Total growth Internal growth 9M 21 Momentum ∆ p.y. ∆ p.y. Total P/C segment 14,113 +9.0% +7.2% +3.8% n.a. Selected OEs Germany 2,233 +2.2% +1.9% +2.1% stable United Kingdom 1,189 +4.3% -1
Slide 12: P/C: internal growth strong at 7.2% - comments
Group financial results 3Q 2021 P/C: internal growth strong at 7.2% Comments • Global lines main growth driver • CEE – strong growth driven by price and volume Strong internal growth of 7.2% driven by volume Romania, Austria and Hungary main contributors. (+5.0%), price (+1.5%) and service income (+
Slide 13: P/C: good underlying performance
Group financial results 3Q 2021 P/C: good underlying performance Operating profit drivers (EUR mn) Combined ratio (in %) -2.1% +0.2%-p 94.5 94.7 1,315 +12 -40 1,287 +0 Loss ratio 67.9 68.0 NatCat impact2 0.7 4.9 (in %-p) Expense ratio 26.7 26.7 3Q 20 3Q 21 Operating Underwriting1 Investment Other Op
Slide 14: P/C: good underlying performance - comments
Group financial results 3Q 2021 P/C: good underlying performance Comments • Operating profit – broadly stable • Expense ratio – excellent performance Better underwriting result is overcompensated by a ER stable vs. prior year at 26.7%. Larger share of high lower investment result. CR worsens 0.2%-p
Slide 15: P/C: significant NatCat in Germany
Group financial results 3Q 2021 P/C: significant NatCat in Germany EUR mn Operating profit Combined ratio NatCat impact on CR 3Q 21 ∆ p.y. 3Q 21 ∆ p.y. 3Q 21 ∆ p.y. Total P/C segment 1,287 -2.1% 94.7% +0.2%-p 4.9%-p +4.2%-p Selected OEs Germany 172 -50.7% 97.9% +8.6%-p 14.3%-p +14.7%-p United Kingdo
Slide 16: P/C: significant NatCat in Germany - comments
Group financial results 3Q 2021 P/C: significant NatCat in Germany Comments • Germany – impacted by NatCat • LatAm – OP declines driven by Brazil and Mexico Improvement in attritional LR and ER more than offset Underwriting result in Brazil impacted by higher frequency in by NatCat losses. motor. Lo
Slide 17: P/C: interest and similar income stabilizes
Group financial results 3Q 2021 P/C: interest and similar income stabilizes Operating investment result1 Current yield Economic reinvestment yield (EUR mn) (debt securities; in %) (debt securities; in %) -6.0% 0.53 0.53 1.3 1.3 663 623 3Q 20 3Q 21 3Q 20 3Q 21 3Q 20 3Q 21 Total average asset base4 Du
Slide 18: P/C: interest and similar income stabilizes - comments
Group financial results 3Q 2021 P/C: interest and similar income stabilizes Comments • Interest & similar income • Reinvestment yield Higher income from private equity investments as Higher yields for developed markets and securitized well as debt securities. The latter is driven by the debt offset
Slide 19: L/H: successful new business management
Group financial results 3Q 2021 L/H: successful new business management PVNBP share by line EUR mn 3Q 20 3Q 21 ∆ p.y. PVNBP 12,947 19,655 +51.8% Total L/H segment 2.9 3.4 APE 1,444 1,809 +25.3% Single premium 7,972 10,928 +37.1% Protection & health 7.2 17% Recurring premium 647 716 +10.7% 31% 4.6 Un
Slide 20: L/H: successful new business management - comments
Group financial results 3Q 2021 L/H: successful new business management Comments PVNBP by line PVNBP by OE • Strong new business across preferred lines: • Germany Life – new business remains on high level Protection & health increases 177% resp. EUR 3.9bn Good acceptance of modified products support
Slide 21: L/H: operating profit very good at EUR 1.3bn
Group financial results 3Q 2021 L/H: operating profit very good at EUR 1.3bn (EUR mn) Operating profit by source Operating profit by line +11.8% +11.8% +51 1,252 +120 +116 1,252 +69 1,119 1,119 233 -224 239 148 142 349 314 522 426 Operating Loadings Investment Technical Expenses Impact of Operating
Slide 22: L/H: operating profit very good at EUR 1.3bn - comments
Group financial results 3Q 2021 L/H: operating profit very good at EUR 1.3bn Comments • Operating profit at 28% of FY outlook midpoint Operating profit by line Operating profit driven by investment margin (+13%), • UL w/o guarantees UL management fees (+20%), loadings from reserves Higher UL managem
Slide 23: L/H: value of new business up 80%
Group financial results 3Q 2021 L/H: value of new business up 80% EUR mn Value of new business New business margin Operating profit 3Q 21 ∆ p.y. 3Q 21 ∆ p.y. 3Q 21 ∆ p.y. Total L/H segment 665 +79.5% 3.4% +0.5%-p 1,252 +11.8% USA 148 +204.5% 3.8% +1.7%-p 300 +4.2% Germany Life 135 +15.7% 3.2% +0.6%-
Slide 24: L/H: value of new business up 80% - comments
Group financial results 3Q 2021 L/H: value of new business up 80% Comments New business Operating profit • NBM very good at 3.4% • Germany Life – very good level Favorable market movements (+0.4%-p) and better Increase in operating profit driven by capital-efficient business mix (+0.3%-p) result in
Slide 25: L/H: investment margin grows by 13%
Group financial results 3Q 2021 L/H: investment margin grows by 13% Investment margin Economic reinvestment yield (debt securities; in %) 3Q 20 3Q 21 1.8 1.6 Based on Ø book value of assets1 (EUR bn) 626 645 Current yield 0.68% 0.75% Based on Ø aggregate policy reserves (EUR bn) 493 513 3Q 20 3Q 21
Slide 26: L/H: investment margin grows by 13% - comments
Group financial results 3Q 2021 L/H: investment margin grows by 13% Comments • Investment margin up EUR 0.1bn to EUR 1.1bn • Investment margin strong at 21bps Result of better investment margin (∆ +2bps to 21bps) PHP of 78.9% vs. 81.6% in prior year. and growth of reserve base (+4.0%). • Reinvestmen
Slide 27: AM: Total AuM exceed EUR 2.5tn
Group financial results 3Q 2021 AM: Total AuM exceed EUR 2.5tn (EUR bn) Total assets under management 3rd party AuM split +2.4% Asset classes Regions 2,488 2,548 Multi-assets Europe 2,389 +1.3% EUR 193bn (+3.5%) EUR 621bn (+2.2%) 658 667 Equities Asia Pacific Allianz Group assets 677 EUR 194bn (+0.1
Slide 28: AM: Total AuM exceed EUR 2.5tn - comments
Group financial results 3Q 2021 AM: Total AuM exceed EUR 2.5tn Comments • Total AuM up 2% • Investment outperformance Increase primarily due to 3rd party assets, driven by AM segment: 90% of 3rd party AuM outperform 3rd party net inflows and F/X effects. benchmarks on a trailing 3-year basis before
Slide 29: AM: continued strong 3rd party net inflows
Group financial results 3Q 2021 AM: continued strong 3rd party net inflows (EUR bn) 3rd party assets under management development 3rd party net flow split +2.8% Asset Fixed income +17.3 +29.5 1,881 classes 1,830 +6.7 +19.1 Equities -0.4 -4.7 Multi-assets +5.9 Alternatives +3.0 Regions America +12.9
Slide 30: AM: continued strong 3rd party net inflows - comments
Group financial results 3Q 2021 AM: continued strong 3rd party net inflows Comments • 3rd party AuM up 3% to EUR 1.9tn 3rd party AuM increase by EUR 51bn to a new all-time high. Strong 3rd party net inflows (EUR 26bn) stem from PIMCO (EUR 19bn) and AllianzGI (EUR 7bn). EUR 1,862bn average 3rd party
Slide 31: AM: 17% revenue growth
Group financial results 3Q 2021 AM: 17% revenue growth (EUR mn) Revenues development PIMCO AllianzGI +17.3% +14.6% +23.7% Internal growth +16.0% +12.1% +25.5% 2,085 1,467 Performance fees 83 29 AuM driven & 1,777 1,281 other revenues1 31 74 617 54 499 43 1,703 2,002 1,250 1,438 456 563 © Allianz SE
Slide 32: AM: 17% revenue growth - comments
Group financial results 3Q 2021 AM: 17% revenue growth Comments • Segment revenues – up 17% • Segment margin – up 0.9bps Significant revenue increase by EUR 308mn mainly due Favorable 3rd party AuM margin of 39.8bps, increase to rising AuM driven revenues, following higher average driven by PIMCO. 3
Slide 33: AM: operating profit up 30%
Group financial results 3Q 2021 AM: operating profit up 30% (EUR mn) Operating profit drivers PIMCO +30.2% +17.4% +30.0% Internal growth +320 8821 628 535 40 Performance fee impact2 6771 -110 -5 OP excl. performance 32 fee impact2 58.2 57.2 CIR (in %) +30.5% 842 3Q 20 3Q 21 645 61.9 57.7 CIR (in %)
Slide 34: AM: operating profit up 30% - comments
Group financial results 3Q 2021 AM: operating profit up 30% Comments • Segment – strong result at both OEs • AllianzGI – quarterly OP at all-time high OP up 30%, at 31% of FY outlook midpoint. Higher AuM driven revenues, following a significantly OP grows mainly due to higher average 3rd party AuM h
Slide 35: CO: in line with expectations
Group financial results 3Q 2021 CO: in line with expectations (EUR mn) Operating result development and components +10 +10 +0 -4 -186 -203 -8.1% Operating Holding & Banking Alternative Consoli- Operating result Treasury Investments dation result 3Q 20 3Q 21 ∆ 3Q 21/20 © Allianz SE 2021 3Q 21 -202 18
Slide 36: CO: in line with expectations - comments
Group financial results 3Q 2021 CO: in line with expectations Comments • Operating loss at 23% of FY outlook midpoint Higher contribution from Banking due to lower loan loss provisions and higher fee and commission income. © Allianz SE 2021 36
Slide 37: Group: shareholders' net income at EUR 2.1bn
Group financial results 3Q 2021 Group: shareholders’ net income at EUR 2.1bn EUR mn 3Q 20 3Q 21 ∆ p.y. Operating profit 2,907 3,236 +329 Non-operating items -21 -287 -267 Realized gains/losses (net) 436 159 -277 Impairments (net) -98 -89 +9 Income from financial assets and liabilities carried at fai
Slide 38: Group: shareholders' net income at EUR 2.1bn - comments
Group financial results 3Q 2021 Group: shareholders’ net income at EUR 2.1bn Comments • Shareholders’ net income up by 2% • Restructuring expenses – IT decommissioning Increase in operating profit (∆ EUR +0.3bn) more than Continuous investments in productivity and offsets lower non-operating profit
Slide 39: To sum it up – strong 9M results
Group financial results 3Q 2021 To sum it up – strong 9M results 110bn 9.9bn +5% +27% Facts and figures Revenues Operating profit 4.7bn 9M 2021 6.9bn 207% Total payout (EUR) 2021 +38% Target: ≥ 180% Shareholders’ Solvency II ratio net income © Allianz SE 2021 39
Slide 40: Content
CONTENT 1 GROUP FINANCIAL RESULTS 3Q 2021 2 ADDITIONAL INFORMATION GLOSSARY DISCLAIMER © Allianz SE 2021
Slide 41: Allianz track record
Group financial results 3Q 2021 – additional information Allianz track record Operating profit 2020: EUR 10.8bn Investment portfolio 2020: EUR 790bn By segments1 By regions: Asset allocation Debt instruments by rating6 P/C Insurance 38% Germany 28% Debt instruments 86% AAA 19% L/H Insurance 38% W &
Slide 42: Glossary & Disclaimer
GLOSSARY & DISCLAIMER © Allianz SE 2021
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: Disclaimer
Disclaimer Disclaimer This document includes forward-looking statements, such as prospects or (v) mortality and morbidity levels and trends, (vi) persistency levels, (vii) the expectations, that are based on management's current views and extent of credit defaults, (viii) interest rate levels, (ix)