Phoenix Financial Ltd · TASE:PHOE
Phoenix Financial — FY2024 Earnings Presentation
50 slides from Phoenix Financial's earnings presentation, March 2025
Slide 1: 2024 Results
2024 Results Phoenix Financial March, 2025 1
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an offer to purchase the Furthermore, the presentation includes data and assessments based Company’s securities or solicitation to receive such offers and is on external sources, the contents of which were not independently designed solely to offer in
Slide 3: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 3
Slide 4: Phoenix Financial | Company Overview
Phoenix Financial | Company Overview Leading financial group 525 NISb ($144b) 20% AUM1 AUM 5-year CAGR2 Insurance Asset Management P&C, Life & Health Investment House & Wealth, Retirement, Agencies & Credit Distinctive performance 2,087 NISm 16.9% Attractive ROE Mostly Fee Related Earnings (FRE), co
Slide 5: Israel Economy | Main Indicators
Israel Economy | Main Indicators Long-term positive GDP Growth 2 GDP per Capita 3 Long-Term Savings AUM 4 structural trends Percent USD ‘000 NIS Trillion (e.g., wealth 9.8% War Sweden 57 accumulation, 2.7 6.3% Germany 56 2.4 2.3 2.4 demographics, 4.3% 3.8% 2.0 4.0% 1.9 vibrant tech 1.9% Israel 53 1.
Slide 6: 2024 | Financial Highlights
2024 | Financial Highlights Continued growth in core income to 1,760 NISm (15.9% core ROE) with 2,087NISm 8.32NIS 18.6% strong performance across activities Positive non-operating effects of 327 Comprehensive Income Comp. Income per Share ROE NISm from investment performance & 2024 actuarial studies
Slide 7: 2024 | Continued Growth in Core Activities
2024 | Continued Growth in Core Activities Income Comprehensive, after tax, NISm 2,316 2,087 327 1,450 1,353 1,093 585 1,124 Non-Operating Effects Q4 450 Positive capital market & special item Non-Operating 752 390 803 effects, net of interest rate effects 664 44 314 578 Core Asset Management 1,175
Slide 8: Investments | Core Capabilities
Investments | Core Capabilities Returns – Insurance Nostro / Corporate Account Asset Allocation - Corporate Account (Nostro) Percent (nominal) Percent (December 31, 2024) 10.6% Alternatives & other Cash 7.9% 4% 7.4% 12% 5.9% 4.8% 4.5% Real estate 12% ~70% 35% Fixed income (Govt) 1.9% fixed Public eq
Slide 9: Dividend Track Record | Commitment to Attractive Payout
Dividend Track Record | Commitment to Attractive Payout Dividend: 565 NISm to be paid in March 2025, Dividend & Buyback increasing total dividend from 2024 income to 835 From annual income, NISm Average dividend yield NISm (together with 270 NISm paid in September); above 5% 2021-24 1,017 policy at
Slide 10: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 10
Slide 11: Group Income | Growth Towards 2027 Targets
Targets before IFRS- 17 and upside, to be Group Income | Growth Towards 2027 Targets updated during 2025 Core Income Phoenix Financial Actual comprehensive NISm, before non-operating income (including non- effects (capital markets, 2,000 operating effects) already interest rates, & special 1,760 abo
Slide 12: Potential Income | Above Published 2027 Targets
Preliminary estimates Potential Income | Above Published 2027 Targets Targets to be updated during 2025 based on IFRS-17 and performance Insurance Asset Management, Agencies & Credit 2027 targets 1,100-1,300 NISm + 700-900 NISm = 2,000 NISm Potential income above 2027 targets 300-400 NISm + 100-200
Slide 13: Group Strategy | Value Drivers to Capture Opportunity
Group Strategy | Value Drivers to Capture Opportunity Accelerated Innovation & Active Capital & Investments Growth Efficiency Management Management in profitable & to increase competitive of people & structure to maximize performance capital-efficient activities advantages Value Catalysts Income gro
Slide 14: Value Creation | Runway Beyond 2027
Value Creation | Runway Beyond 2027 Value creation over time Significant opportunities & We are here strong trends Execution toward Driving Next Wave Global trends of convergence 2027 targets between asset management and insurance, AI, growth in private markets Israel trends of rapid wealth Growing
Slide 15: Compounding AUMs | Continued Growth
Compounding AUMs | Continued Growth 2027 Target 600-650 NISb Assets Under Management NISb, end of period 525 433 117 Retirement - Pension +20% CAGR 369 371 92 53 67 123 Retirement - Provident Asset 113 Management 234 117 111 215 37 135 Investment House & Wealth 178 31 35 90 24 34 70 66 30 56 23 32 I
Slide 16: Growth Engines | Continued EBITDA Growth
Asset Management Agencies & Credit Growth Engines | Continued EBITDA Growth 2027 Target Growth engines include Asset Adjusted EBITDA for Asset Management, Agencies & Credit Management, Agencies & Credit NISm, consolidated including minorities 1.6-1.8 NISb Significant FRE (Fee-Related Earnings) • EBI
Slide 17: Asset Management
Asset Management Agencies & Credit Asset Management Description: AUM Core Income, net Investment House (Funds & ETFs, NISb NISm, before non-operating effects +16% CAGR Brokerage, Portfolios, ESOP, W) Wealth (private markets) 375 300-400 305 Retirement (Pension & Provident) 295 241 244 230 Investment
Slide 18: Distribution | Agencies
Asset Management Agencies & Credit Distribution | Agencies Assessing opportunities to unlock & create value Description: Revenues Core Income, net Benefit administration, retirement planning, NISm NISm, before non-operating effects & insurance (life, health, P&C, specialties) 250-350 Independent age
Slide 19: Credit | Primarily Phoenix Gama
Asset Management Agencies & Credit Credit | Primarily Phoenix Gama Description: Credit Portfolio Core Income, net Credit card clearing & financing NISb, including mergers NISm, before non-operating effects SME lending 150-200 3.4 Construction finance (merged 2024) Consumer credit (launched 2024) 2.5
Slide 20: Insurance | Strong Performance
Insurance Insurance | Strong Performance Targets to be updated during 2025 based on IFRS-17 and performance Activities: Insurance Gross Premiums NISb, not including contributions P&C (motor, property, liabilities) to savings & investment policies 9.4 8.6 0.9 Life (risks, unit-linked savings) 7.8 Inv
Slide 21: Insurance | Competitive Advantage & Optimization
Insurance Insurance | Competitive Advantage & Optimization Competitive advantage Income and share1 P&C, 9M/2024 800 Phoenix P&C growth focusing on 600 competitive advantages: Income Accelerate profitable growth NISm driven by ML-based accurate 400 pricing, hybrid distribution, self- service, claims
Slide 22: Technology | In Step with Business Strategy
Technology | In Step with Business Strategy Goals Focus Areas & Examples Data analytics & ML for pricing & Strategy execution underwriting, cross-sell, personalization Competitive Advantage Consumer Credit distinctive digital platform Long-term value creation (data, underwriting, service) Group syne
Slide 23: Sustainability | Ensuring Value Creation
Sustainability | Ensuring Value Creation Insurance Asset Management 1. Business Value Creation a. Business opportunities & risks b. Investment stewardship from disruption Electric vehicles Corporate governance Strategic growing market with 30% of Appointment of directors, conflict of new sales, spec
Slide 24: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 24
Slide 25: Q4 2024 | Income by Source
Before IFRS-17 implementation Q4 2024 | Income by Source Breakdown Before Tax – By Segment NISm Q4-24 Q4-23 Difference P&C 253 328 (75) Health 51 21 30 Core Income Breakdown (Comprehensive) Life & Savings 65 50 15 Q4 2024, NISm Other Equity Returns 33 (5) 38 1,257 Core Insurance 402 394 8 Retirement
Slide 26: 2024 | Income by Source
Before IFRS-17 implementation 2024 | Income by Source Breakdown Before Tax – By Segment NISm 2024 2023 Difference P&C 884 638 246 Health 348 165 183 Core Income Breakdown (Comprehensive) Life & Savings 245 217 28 2024, NISm Other Equity Returns 283 294 (11) 3,212 Core Insurance 1,760 1,314 446 Retir
Slide 27: Q4 2024 | Income by Segment
Q4 2024 | Income by Segment Segment Income Breakdown (Comprehensive) Q4 2024, NISm 1,257 28 (2) 74 21 60 (425) 439 803 (29) 259 (33) 411 P&C Health Life Other Retirement Investment Agencies Credit Other Income Tax Miniority Q4/24 Equity House & before Tax Returns Wealth & Minority 1,076 181 Insuranc
Slide 28: 2024 | Income by Segment
2024 | Income by Segment Segment Income Breakdown (Comprehensive) 2024, NISm 3,212 137 7 300 303 (1,013) 93 (112) 2,087 712 281 290 1,089 P&C Health Life Other Retirement Investment Agencies Credit Other Income Tax Miniority 2024 Equity House & before Tax Returns Wealth & Minority 2,372 840 Asset Ma
Slide 29: IFRS 17 & 9 | Positive Impact on H1 2024 Income
PRO-FORMA H1 2024 IFRS 17 & 9 | Positive Impact on H1 2024 Income Comprehensive Income & Core Income Highlights Pre-tax Income Breakdown H1 2024 (after tax), NISm H1 2024 (before tax), NISm Positive impact IFRS 4 IFRS 17&9 Difference 437 429 (8) 892 +225 P&C Increase of over 200 NISm on H1 Health 19
Slide 30: Balance Sheet | Strong & Liquid
Balance Sheet | Strong & Liquid Financial Liabilities (NISm) Bonds and Loans 31/12/2024 31/12/2023 CPI Floating Fixed IFRS 4 IFRS 17&9 linked interest interest Total Total Phoenix Financial NISm 31/12/2024 31/12/2023 Difference 31/12/2023 Difference Financial Solo* 950 397 527 1,875 1,896 Cash 2,742
Slide 31: Capital Management | Solvency
Capital Management | Solvency Solvency ratio (Insurance Company) Solvency II implementation Cashflow and Liquidity (Phoenix Financial Company) Solvency II implemented in Israel in line with international standards, with strong regulatory Insurance subsidiary dividend With 211% oversight payout 40-60
Slide 32: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 32
Slide 33: Insurance P&C
Insurance P&C Continued growth and profitability despite Comprehensive Income Before Tax competitive market & high theft frequency NISm 1,089 Optimized use of machine learning for motor (15) underwriting 179 Positive impact of investments & interest rates 41 Core Income 884 2023 Q1/24 Q2/24 Q3/24 Q4
Slide 34: Health
Insurance Health Improvement in underwriting profit Comprehensive Income Before Tax NISm Negative impact from LAT reserves mainly due to decrease in interest rates (12) Positive impact from actuary research 290 Maccabi HMO collective LTC agreement ended (136) December 2023 90 Health insurance reform
Slide 35: Life & Savings
Insurance Life & Savings Improvement in underwriting profit Comprehensive Income Before Tax NISm Positive non-operating effects mainly due to interest rate effects, partially offset by investment profit below 3%. (40) 281 Continued inflows from investment policies 177 Initiated re-collection of vari
Slide 36: Other Equity Returns (Insurance)
Insurance Other Equity Returns (Insurance) Positive capital market Comprehensive Income Before Tax effects (above 3% real yields) NISm compared to negative effects in 2023 712 (7) 436 283 Financial Margin Investments Special Items 2024 above 3% 2023 294 (406) (41) (153) Difference (11) 842 34 865 Q4
Slide 37: Investment House & Wealth (Financial Services)
Asset Management Agencies & Credit Investment House & Wealth (Financial Services) Performance improvement from Comprehensive Income Before Tax continued strategic execution NISm Growth in brokerage business 8 20 (30) 303 continued new client acquisition, 17 average revenues & higher spreads in margi
Slide 38: Retirement (Pension & Provident)
Asset Management Agencies & Credit Retirement (Pension & Provident) Continued organic growth Comprehensive Income Before Tax NISm Focus on profitability including higher margin / efficient activities (10) Negative Special Items due (15) 93 to increase of legal provisions 118 Core Income Investments
Slide 39: Distribution (Agencies, Planning, Benefits)
Asset Management Agencies & Credit Distribution (Agencies, Planning, Benefits) 17% growth in core income year Comprehensive Income Before Tax on year NISm Continued organic growth leading to higher core income, despite (21) 300 (10) negative effects of slower pace of hiring in the market (including
Slide 40: Credit (Primarily Phoenix Gama)
Asset Management Agencies & Credit Credit (Primarily Phoenix Gama) Synergetic merger of Comprehensive Income Before Tax Phoenix Construction NISm Finance in January 2024, following successful take- (13) 137 private tender offer for Gama (NISm) 2023 2024 Turnover credit in 2023 portfolio Limited grow
Slide 41: Other
Other Segment includes Comprehensive Income Before Tax Phoenix Financial NISm (formerly Phoenix 0 Holdings) solo profits (including RT1 holding) as well as other items Restructured to improve (25) capital & investments 32 efficiency 0 7 Financial Subsidiaries Other Special Items 2024 Margin 2023 13
Slide 42: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 42
Slide 43: IFRS 17 & 9 | Pro-Forma H1/2024 by Segment
Pro-Forma H1/2024 IFRS 17 & 9 | Pro-Forma H1/2024 by Segment Not normalized for core income versus non- operating effects Pro-forma under new accounting standards IFRS 17 & 9: Insurance P&L (Key line items)** Segment Income Breakdown H1 2024, NISm H1 2024, NISm Insurance Services Result (Net) 875 54
Slide 44: Investment Returns | Explanation
Investment Returns | Explanation Reconciliation of investment returns above / below 3% real returns with financial statements NISm 2024 2023 P&L Items from Financial Statements Investment income 16,570 9,910 Share in profits of equity-accouted investees 103 42 Total components of net other comprehen
Slide 45: Best in Class ROE
Best in Class ROE Return on Equity 3 years average (2021-23) 5 years average (2019-23) 10 years average (2014-23) 2024 (1-9 months) Phoenix 16% Phoenix 15% Phoenix 14% Phoenix 16% A 15% A 14% A 11% A 16% B 12% B 11% B 8% B 10% C 11% C 12% C 11% C 8% D 10% D 8% D 6% D 9% 45 Data based on EY analysis
Slide 46: Positioned to Capture Opportunities
Positioned to Capture Opportunities Insurance Penetration Insurance Premiums Assets Under Management Premiums out of GDP, % 2022 9/24, Not including Investment Policies Institutional investors & Mutual funds, 9/24 Phoenix US 12% 15% 23% 20% 24% UK 11% 57 3.3 15% Italy 7% 12% NISb 16% 10% NISt 11% 14
Slide 47: Growth & Value Drivers
Growth & Value Drivers Strong market position with distinctive growth & performance 1 Phoenix Financial is the premier financial group in Israel with $140 billion assets under management, delivering compounding AUMs with 20% annual growth and best-in-class 17% average ROE over 5 years. Trading on Te
Slide 48: Agenda
Highlights Strategy & Targets Agenda Financial Results Segment Breakdown Appendix Glossary 48
Slide 49: Glossary
Glossary Adjusted EBITDA - calculated as income before finance, taxes, depreciation and amortization in the relevant areas of activity; adjustments as detailed below: Investment House - IFRS 16 adjustment and special items Adjusted EBITDA Retirement (Pension and Provident) - IFRS 16 adjustment and a
Slide 50: Glossary
Glossary LTS Long Term Services; including but not limited to Life, Provident and Pension funds Marketable Securities Liquid financial assets that can be quickly converted into cash; most are trading assets MF Management Fees; wages charged by a financial manager Moody’s A credit risk rating agency