Axa Sa · EURONEXT:CS
Axa Sa — FY2015 Earnings Presentation
132 slides from Axa Sa's earnings presentation, Feb 25, 2016
Slide 1: AXA Full Year 2015 Earnings Presentation
AXA FULL YEAR 2015 EARNINGS Presentation February 25, 2016
Slide 2: Forward-looking statements
Certain statements contained herein are forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and
Slide 3: Table of Contents
TABLE OF CONTENTS INTRODUCTION & HIGHLIGHTS PAGE A4 Henri de Castries, Chairman & CEO FY15 FINANCIAL PERFORMANCE PAGE A19 Denis Duverne, Deputy CEO & Gérald Harlin, Group CFO CONCLUDING REMARKS PAGE A48 Henri de Castries, Chairman & CEO A3 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 4: Introduction & highlights
Introduction & highlights Henri de Castries, Chairman & CEO
Slide 5: FY15 Results
FY15 RESULTS Strong earnings and dividend per share Successful delivery of Ambition AXA Well prepared for the future A5 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 6: Strong earnings growth in 2015
STRONG EARNINGS GROWTH IN 2015 UNDERLYING EARNINGS ADJUSTED EARNINGS In Euro billion In Euro billion +2% +2% 6.0 5.6 5.5 5.1 +10% +9% Reported growth Reported growth FY14 FY15 FY14 FY15 Changes are at constant Forex unless otherwise specified A6 | Full Year 2015 Earnings | Presentation | February 25
Slide 7: Increased dividend per share
INCREASED DIVIDEND PER SHARE UNDERLYING EARNINGS PER SHARE DIVIDEND PER SHARE In Euro In Euro +10% +16% 2.16 1.10 1.95 0.95 FY14 FY15 ADJUSTED EARNINGS PER SHARE In Euro FY14 FY15 +9% Payout ratio 45% 47% 2.34 2.14 Payout ratio range guidance 45–55% of adjusted earnings net of undated debt interest
Slide 8: Ambition AXA has successfully transformed the Group
AMBITION AXA HAS SUCCESSFULLY TRANSFORMED THE GROUP AMBITION AXA PRIORITIES… …HAVE LED TO... High Return on Equity Selectivity Strong balance sheet Acceleration Resilient earnings Diversified footprint Efficiency Digital momentum A8 | Full Year 2015 Earnings | Presentation | February 25, 2
Slide 9: AXA delivered on its Ambition AXA key objectives
AXA DELIVERED ON ITS AMBITION AXA KEY OBJECTIVES UNDERLYING EARNINGS PER SHARE GROUP OPERATING FREE CASH FLOWS In Euro per share In Euro billion Cumulative operating Free Cash Flows: Euro 25.4 billion 5.8 Ambition 5.2 5.5 Ambition AXA 2010- 4.7 AXA 2011- 2.16 4.2 1.95 2015 2015 1.85 1.69 CAGR cu
Slide 10: AXA's financial position has been significantly strengthened
AXA’S FINANCIAL POSITION HAS BEEN SIGNIFICANTLY STRENGTHENED STRONG SOLVENCY II RATIO1 REDUCED DEBT GEARING FY15 230% 28% 205% Target range 23% 170% RESILIENCE TO EXTREME SCENARIOS Ratio as at Dec 31, 2015 205% 2008/2009 financial crisis2 160% -45 pts 2011 financial crisis3 183% -22 pts FY10 FY15 A1
Slide 11: AXA is disciplined
AXA IS DISCIPLINED DISCLIPINED CAPITAL ALLOCATION LOW SENSITIVITY TO INTEREST RATES Cumulative FY10-FY15 Based on FY15 €6bn ca. 1 year €9bn €-0.2bn HIGH QUALITY ASSET PORTFOLIO % of FY15 General Account invested assets Average rating of government and related bonds in the AA range Average rating of
Slide 12: AXA is growing with increasingly profitable business
AXA IS GROWING AND WITH INCREASINGLY PROFITABLE BUSINESS IMPROVED LIFE & SAVINGS BUSINESS MIX CONTINUED TO GROW THE P&C BUSINESS AND INCREASED MARGIN WHILE IMPROVING PROFITABILITY In Euro billion In Euro billion APE NBV margin Revenues 7.4 CAGR +4% 13% 5% 6% 31.3 26.0 5.8 Mutual funds & other 13% 38
Slide 13: AXA strengthened its footprint in high growth markets
AXA STRENGHTENED ITS FOOTPRINT IN HIGH GROWTH MARKETS Strong footprint in 2015 Acquisitions since 2010 #1 P&C international insurer Euro Asia #3 Life & Savings international insurer 4.2 billion #2 P&C insurer in Mexico Euro MedLA #3 P&C insurer in Turkey 0.7 billion #3 insurer in Nigeria Euro CEE #3
Slide 14: Asia significantly contributes to Group results
ASIA SIGNIFICANTLY CONTRIBUTES TO GROUP RESULTS x2 APE In Euro million Euro 2.0 billion 1,171 Cumulative total underlying earnings In Euro million 584 551 FY101 FY15 461 402 362 x1.8 NBV In Euro million 273 631 347 FY101 FY15 FY11 FY12 FY13 FY14 FY15 A14 | Full Year 2015 Earnings | Presentation | Fe
Slide 15: AXA has focused on efficiency while investing in digital
AXA HAS FOCUSED ON EFFICIENCY WHILE INVESTING IN DIGITAL 2011-2015 COST SAVINGS (in mature Life & Savings and Property & Casualty entities) In Euro billion 1.9 1.9 1.7 Savings net of 1.5 Euro 950 million invested in digital since 2013 Initial target Updated Updated Actual June 2011 February 2013 Aug
Slide 16: AXA's digital transformation is gathering momentum
AXA’S DIGITAL TRANSFORMATION IS GATHERING MOMENTUM INVESTING ACROSS THE VALUE CHAIN 15% Offer design Distribution, 30% SCOUT multichannel Euro 950 million 2013-15 34% Automation and process ENGAGE Customer 22% analytics SEEDING THE FUTURE Euro 230 million in Euro 100 million in Euro 75 million in 1
Slide 17: AXA is a leader in responsible investing and sustainability
AXA IS A LEADER IN RESPONSIBLE INVESTING AND SUSTAINABILITY Divest from the companies most exposed to coal related activities Representing Euro 0.5 billion of divestment Publication of 2015 carbon footprint 284 tons of CO2 per $ million of revenue1 Achieved 96th percentile ranking among insurers bas
Slide 18: AXA is well set for the future
AXA IS WELL SET FOR THE FUTURE BALANCED BUSINESS MIX TOP GLOBAL BRAND5 in % of FY15 Group pre-tax underlying earnings1 25% Protection & Health2 36% 39% Savings3 & Property & Casualty4 Asset Management STRONG BALANCE SHEET TOP INNOVATIVE INSURANCE COMPANY Solvency II ratio - FY15 230% N°1 insurance c
Slide 19: FY15 Financial performance
FY15 Financial performance Denis Duverne, Deputy CEO & Gérald Harlin, Group CFO
Slide 20: FY15 Financial performance
FY15 FINANCIAL PERFORMANCE Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A20 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 21: Underlying earnings
UNDERLYING EARNINGS UNDERLYING EARNINGS UNDERLYING EARNINGS BY SEGMENT In Euro million Constant In Euro million FY14 FY15 Change +2% Forex 5,574 Life & Savings 3,132 3,503 +3% 5,060 Property & Casualty 2,158 2,230 - 1% Asset Management 403 458 +1% International insurance 208 193 - 7% Banking 106 97
Slide 22: Adjusted earnings
ADJUSTED EARNINGS ADJUSTED EARNINGS DETAILS OF ADJUSTED EARNINGS In Euro million +2% 6,008 In Euro million FY14 FY15 5,503 Underlying earnings 5,060 5,574 Net realized capital gains/losses 442 433 o/w realized capital gains 760 725 o/w net impairments -296 -278 o/w hedging of equity portfolio -22 -1
Slide 23: Net income
NET INCOME NET INCOME DETAILS OF NET INCOME In Euro million In Euro million FY14 FY15 +3% 5,617 Adjusted earnings 5,503 6,008 5,024 Change in fair value & forex 225 -229 o/w gains (losses) on interest rate economic hedges not 226 -158 eligible for hedge accounting under IAS 39 o/w gains (losses) on
Slide 24: FY15 Financial performance
FY15 FINANCIAL PERFORMANCE Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A24 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 25: L&S – New business sales and margins by market
L&S – NEW BUSINESS SALES AND MARGINS BY MARKET In Euro million High growth Mature markets Total markets Total +5% +6% 7,376 o/w Hong Kong -12% 6,075 o/w other high growth +12% 6,477 5,341 New business +1% sales (APE) + 1,136 1,301 = FY14 FY15 FY14 FY15 FY14 FY15 +2 pts -1 pt 49% 51% -1 pt 34% 34% 31
Slide 26: L&S – New business sales and margins by business
L&S – NEW BUSINESS SALES AND MARGINS BY BUSINESS APE NBV Net Flows (Euro million) margin (Euro billion) Business line FY15 change FY15 FY14 FY15 G/A Protection & Health 2,681 +4% 52% +5.2 +5.9 G/A Savings 943 -7% 19% -2.0 -2.4 Unit-Linked 2,811 +12% 31% +0.7 +5.7 Mutual Funds & Other 941 +7% 6% +0.1
Slide 27: L&S – Pre-tax underlying earnings by business
L&S – PRE-TAX UNDERLYING EARNINGS BY BUSINESS TOTAL G/A PROTECTION G/A SAVINGS UNIT-LINKED LIFE & SAVINGS1 & HEALTH In Euro million In Euro million In Euro million In Euro million +2% +3% 2,303 4,518 2,133 4,105 +10% -4% 1,296 1,048 840 822 FY14 FY15 FY14 FY15 FY14 FY15 Higher fees due to increased
Slide 28: FY15 Financial performance
FY15 FINANCIAL PERFORMANCE Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A28 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 29: P&C – Revenues by segment
P&C – REVENUES BY SEGMENT TOTAL PERSONAL LINES In Euro million In Euro million +2% +1% 17,162 18,057 31,265 29,460 • Average price effect of +3.2% • Motor revenues up 3% • Non-motor revenues up 1% FY14 FY15 COMMERCIAL LINES In Euro million 0% 12,104 13,005 • Average price effect of +2.4% • Revenues’
Slide 30: P&C – Price effect by country and segment
P&C – PRICE EFFECT BY COUNTRY AND SEGMENT FY15 Personal Lines Commercial Lines Price Revenues Price Revenues effect 1 evolution growth effect1 1 evolution growth 2016 market pricing trends Expected slowdown in price increases from France +2.3% +1.4% +4.4% -1.1% increased competition Early signs of h
Slide 31: P&C – Revenues and margins by market
P&C – REVENUES AND MARGINS BY MARKET High growth Mature markets Direct Total markets In Euro million +1% 0% o/w Asia +8% 31,265 29,460 23,374 o/w Turkey 0% 22,378 Revenues + 4,721 +3% 5,159 + 2,361 +7% 2,732 = FY14 FY15 FY14 FY15 FY14 FY15 FY14 FY15 99.4% excluding adverse claims experience in Turke
Slide 32: P&C – Underlying earnings
P&C – UNDERLYING EARNINGS P&C UNDERLYING EARNINGS COMBINED RATIO In Euro million Current year Prior year reserve All-year combined ratio + developments combined ratio + Lower Nat Cat + Price increases and lower frequency 95.6% excluding Turkey reserve strengthening and -1% - Higher severity with nor
Slide 33: FY15 Financial performance
FY15 FINANCIAL PERFORMANCE Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A33 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 34: AM – Assets under management
AM – ASSETS UNDER MANAGEMENT Average AUM and net flows in Euro billion Revenues in Euro million Net flows Average AUM Revenues (incl. Joint Ventures)1 (excl. Joint Ventures) (excl. Joint Ventures) +7% +4% +42 554 618 1,151 1,242 +19 FY14 FY15 FY14 FY15 FY14 FY15 Euro 34 billion from Joint Ventures i
Slide 35: AM – Underlying earnings
AM – UNDERLYING EARNINGS ASSET MANAGEMENT In Euro million In Euro million +5% +1% 234 211 458 403 FY14 FY15 In Euro million -2% 224 193 FY14 FY15 FY14 FY15 Full detail in appendix on pages B43 to B44 Changes are at constant Forex A35 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 36: FY15 Financial performance
FY15 FINANCIAL PERFORMANCE Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A36 | Full Year 2015 Earnings | Presentation | February 25, 2016
Slide 37: Asset & liability management (1/4)
ASSET & LIABILITY MANAGEMENT (1/4) Diversified and resilient investment portfolio FY15 Total General Account Limited yield dilution invested assets 83% in Fixed income Fixed income Assets duration as at December 31, 2015 Real estate Alternative investments1 Life & Savings 8.0 years 5% 3% Listed equi
Slide 38: Asset & liability management (2/4)
ASSET & LIABILITY MANAGEMENT (2/4) Diversified and resilient investment portfolio Government and related bonds rating Corporate bonds rating1 41% of total General Account invested assets in FY15 34% of total General Account invested assets in FY15 AA 42% AA 15% 33% A AAA 22% Euro 225 billion AAA 11%
Slide 39: Asset & liability management (3/4)
ASSET & LIABILITY MANAGEMENT (3/4) Well diversified and high quality new investments New fixed income investments in FY15 Resilient new investment yield Investment Grade Government bonds credit & related Average rating: A Average rating: AA Yield on new investments in fixed income assets ~57% for Li
Slide 40: Asset & liability management (4/4)
ASSET & LIABILITY MANAGEMENT (4/4) Life & Savings General Account investment spreads and margin Inforce business New business Spread above Resilient investment Spread above guaranteed rates margin1 guaranteed rate +160 bps 80 bps 79 bps Guidance: 3.6% 70-80 bps +160bps 2.1% 2.0% 0.5% FY15 FY14 FY15
Slide 41: Shareholders' equity
SHAREHOLDERS’ EQUITY Shareholders’ equity Key drivers of change In Euro billion In Euro billion FY15 vs. FY14 68.5 65.2 + Net income for the period +5.6 - Undated Subordinated debt interest charges -0.3 - Dividends -2.3 - Change in net unrealized capital gains -2.6 - Change in pension benefits -0.1
Slide 42: Debt & ratings
DEBT & RATINGS Financial debt Debt ratios In Euro billion FY14 FY15 13.5 14.3 Debt 24% 23% Gearing 9.1 9.5 Interest 9.9x 10.7x Cover2 6.8 Ratings 6.9 A+ as of 29/10/2015 1.6 positive 0.6 -2.8 -4.0 Aa3 as of 20/01/2016 stable FY14 FY15 AA- as of 06/10/2015 Undated subordinated debt Cash stable Subord
Slide 43: Solvency II ratio
SOLVENCY II RATIO Solvency II ratio Key sensitivities In Euro billion Ratio as of Dec 31, 2015 205% 201% 205% Solvency II ratio Interest rate +50bps 207% +2 pts 59.2 54.3 Interest rate -50bps 197% -8 pts 28.8 Corporate spreads +75bps 205% 0 pt 27.0 Available capital Equity markets +25% 208% +3 pts R
Slide 44: Group embedded value
GROUP EMBEDDED VALUE In Euro billion +8.2 +0.3 51.2 47.2 -2.2 -2.3 FY14 Operating return Economic & other Dividend paid Forex & other FY15 non-operating to shareholders variances in 2015 18% operating return on Group EV driven by strong performance across all business lines Required capital definiti
Slide 45: L&S operating free cash flows and internal rate of return
L&S OPERATING FREE CASH FLOWS AND INTERNAL RATE OF RETURN Life & Savings Operating Free Cash Flows In Euro billion Higher cash flow from Euro 0.5 billion lower cash requirement from 4.9 -1.8 L&S new business in EEA entities 4.5 -2.0 under Solvency II 3.1 2.5 Expected New business Operating Expected
Slide 46: Strong cash flow generation & remittance
STRONG CASH FLOW GENERATION & REMITTANCE In Euro billion Additional cash flows following lower cash consumption from Life & Savings new business in EEA entities under Solvency II FY15 vs. FY14 +5% +7% growth 6.3 5.8 0.5 5.5 5.1 Of which Euro 0.6 billion repayment of 4.7 US loan in the form of cash u
Slide 47: Sensitivities to market conditions
SENSITIVITIES TO MARKET CONDITIONS LIMITED INTEREST RATE SENSITIVITY Per annum cumulative impacts confirmed Assumed 2.0% 2.4% reinvestment yield Estimated impact on ca. ca. Underlying Earnings1 €-0.2bn €-0.1bn LIMITED EQUITY SENSITIVITY RESILIENT SOLVENCY II RATIO Underlying earnings impact through
Slide 48: Concluding remarks
Concluding remarks Henri de Castries, Chairman & CEO
Slide 49: Concluding remarks
CONCLUDING REMARKS Key takeaways Going forward Successful Ambition AXA delivery Well positioned for future growth Strong and resilient Balance Sheet Accelerate transformation Further improved business mix Resilience to market conditions High quality invested assets Sustainable divide
Slide 50: Q&A
Q&A FULL YEAR 2015 EARNINGS
Slide 51: Notes (1/2)
NOTES (1/2) Page A9 1. Compound annual growth rate, on a reported basis 2. Adjusted ROE: return corresponds to adjusted earnings net of interest charges on undated debt. Equity corresponds to average shareholders’ equity excluding undated debt and reserves related to change in fair value 3. Average
Slide 52: Notes (2/2)
NOTES (2/2) Page A27 1. Including Mutual Funds & Other. Pre-tax Underlying Earnings for Mutual Funds & Other amounted to Euro 85 million for FY14 and Euro 97 million for FY15 2. Changes are adjusted for Forex and changes related to scope with the acquisition of Colpatria in Colombia in 2014 Page A30
Slide 53: Definitions
DEFINITIONS AXA’s FY15 financial statements have been examined by the Board of Directors on February 24, 2016 and are subject to completion of audit procedures by AXA’s statutory auditors. AXA's FY15 results have been prepared in accordance with IFRS and interpretations applicable and endorsed by th
Slide 54: Appendices
AXA FULL YEAR 2015 EARNINGS Appendices February 25, 2016
Slide 55: Forward-looking statements
Certain statements contained herein are forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and
Slide 56: Table of Content
TABLE OF CONTENT BUSINESS OVERVIEW B4 AMBITION AXA B9 GROUP B15 LIFE & SAVINGS B19 PROPERTY & CASUALTY B35 ASSET MANAGEMENT B42 BALANCE SHEET B45 CORPORATE RESPONSIBILITY B77 B3 | Full Year 2015 Earnings | Appendices | February 25, 2016
Slide 57: Business overview
Business overview
Slide 58: Life & Savings | Scope overview
LIFE & SAVINGS | Scope overview Global footprint Well balanced business mix FY15 APE by geography FY15 APE by business Unit-Linked G/A Protection & Health France 38% 24% US 36% Total APE 22% Euro 7,376 million Mutual Funds & other G/A Savings UK 13% 13% 13% Asia (incl. Japan) 22% MedLA1 Strong propr
Slide 59: Property & Casualty | Scope overview
PROPERTY & CASUALTY | Scope overview Global footprint Strong presence in Motor FY15 Revenues by geography FY15 Revenues by business Health 12% Asia Workers’ compensation 4% Other1 5% Motor 0% 42% Total Property Direct Euro 31.3 billion 23% business unit France 9% 19% Liability Switzerland Constructi
Slide 60: AXA's footprint in high growth markets
AXA’S FOOTPRINT IN HIGH GROWTH MARKETS Life & Savings Property & Casualty FY15 APE by geography FY15 Revenues by geography Poland Hong Kong Other 3% 8% 4% Czech Republic Thailand 3% Mexico Singapore 2% Philippines 2% 5% 3% Singapore Malaysia 6% Hong Kong 6% Mexico 40% Colombia 30% China 13% 8% Moroc
Slide 61: Asset Management | Scope overview
ASSET MANAGEMENT|Scope overview Complementary business models • Multi-expert model: structured by • Risk-reducing, return-seeking, diversifying “Expertise” strategies and customized solutions • Expertise in fixed income, equities, • Expertise in actively managed equity and fixed PRODUCT quantitative
Slide 62: Ambition AXA
Ambition AXA
Slide 63: Ambition AXA: Adjusted return on equity
AMBITION AXA: Adjusted return on equity GROUP LIFE & SAVINGS In % In % 13-15% 14% 13% 12% 9-11% 9% FY10 FY15 Ambition FY10 FY15 Ambition AXA 2015 AXA 2015 PROPERTY & CASUALTY ASSET MANAGEMENT In % In % 15% 12-14% 12% 18-20% 18% 10% FY10 FY15 Ambition FY10 FY15 Ambition AXA 2015 AXA 2015 B10
Slide 64: Ambition AXA: Life & Savings
AMBITION AXA: Life & Savings RESHAPE SAVINGS BUSINESS IMPROVE NEW BUSINESS MARGIN Unit-Linked share in Continental Europe Savings APE, in % NBV margin, in % In Euro million 1,765 1,601 34% 25% > 28% 50% 45% 22% FY10 FY15 Ambition FY10 FY15 Ambition AXA 2015 AXA 2015 ACTIVELY GROW PROTECTION & HE
Slide 65: Ambition AXA: Property & Casualty
AMBITION AXA: Property & Casualty MAINTAIN MARKET SHARE IN TRADITIONAL REDUCE CURRENT YEAR COMBINED RATIO BUSINESSES In % FY10 FY15 102.6% 97.3% < 97% France 15% 15% Germany 6% 6% UK 5% 8% Switzerland 13% 13% Belgium 21% 18% FY10 FY15 Ambition Sources: FY10 and FY15 AXA activity reports. 2009 an
Slide 66: Ambition AXA: High growth markets
AMBITION AXA: High growth markets DOUBLE PROPERTY &CASUALTY REVENUES DOUBLE LIFE & SAVINGS NBV In Euro million In Euro million x 1.7 x 1.6 Ambition AXA Ambition AXA 5,159 664 2,990 410 ~ x2 ~ x2 FY10 FY15 FY10* FY15 BOOST UNDERLYING EARNINGS DOUBLE LIFE & SAVINGS ASIAN APE In Euro million In Euro mi
Slide 67: Ambition AXA: Efficiency
AMBITION AXA: Efficiency LIFE & SAVINGS COST INCOME RATIO MAINTAIN P&C ADMINISTRATIVE COSTS In % In Euro billion 68.1% 62.8% 3.3 3.3 3.3 Ambition AXA -5 pts FY10 FY15 FY10 FY15 Ambition AXA 2015 IMPROVE P&C ENLARGED EXPENSE RATIO MAINTAIN L&S ADMINISTRATIVE COSTS In % In Euro billion 32.6% 30.4%
Slide 68: Group
Group
Slide 69: Revenues
REVENUES Revenues by segment Reported Comparable In Euro million FY14 FY15 change change Life & Savings 55,345 59,211 +7% 0% Property & Casualty 29,460 31,265 +6% +1% Asset Management 3,326 3,822 +15% +1% International Insurance 3,292 3,615 +10% +7% Banking 564 621 +10% +10% Revenues 91,988 98,534 +
Slide 70: Underlying earnings by geography
UNDERLYING EARNINGS BY GEOGRAPHY Underlying Earnings In Euro million Change at Reported FY14 FY15 change constant Forex Life & Savings 3,132 3,503 +12% +3% United States 760 854 +12% -6% France 768 824 +7% +7% NORCEE1 672 695 +3% -2% UK 28 75 +165% +139% Asia-Pacific (incl. Japan) 763 910 +19% +8% 2
Slide 71: FY15 key sensitivities
FY15 KEY SENSITIVITIES P&L Balance Sheet 1 Impairments net of Change in fair value Total impact in Net Net unrealized capital In Euro billion hedges through and Forex through Income (incl. Impact gains through through Adjusted Adjusted earnings Net income earnings) Shareholders' equity -25% -0.5 0.0
Slide 72: Life & Savings
Life & Savings
Slide 73: Life & Savings
LIFE & SAVINGS 1 REVENUES, NEW BUSINESS VOLUMES AND PROFITABILITY Page B21 2 UNDERLYING EARNINGS MARGIN ANALYSIS Page B22 3 UNDERLYING EARNINGS MARGIN ANALYSIS BY BUSINESS Page B28 4 FOCUS ON THE US Page B34 B20 | Full Year 2015 Earnings | Appendices | February 25, 2016
Slide 74: L&S | Revenues and net inflows
1 L&S | Revenues and net inflows FY15 L&S revenues by region L&S net inflows In Euro billion Net flows by country/region In Euro billion FY14 FY15 France +2.5 +3.2 MedLA NORCEE +1.0 +0.9 -11% 5.7 United States -1.5 0.0 United Kingdom +0.4 +2.9 16.0 France +6% Asia Pacific (incl. Japan) +1.6 +2.6 16.
Slide 75: L&S | Underlying earnings margin analysis
2 L&S | Underlying Earnings margin analysis Gross Margin Expenses In Euro million In Euro million Comp. Comp. FY15 1 FY15 1 Change Change 4 4 Margin on revenues 2 5,180 +4% Acquisition expenses 4,210 +4% Margin on assets 5,990 +3% Admin. Expenses 3,036 -1% Technical margin 609 -12% VBI amortization
Slide 76: L&S | Margin analysis: margin on revenues
2 L&S | Margin Analysis Margin on revenues Details of margin on revenues Average margin on L&S revenues1 8.7% +0.3 pt +0.1pt business mix Detail by product +0.2pt country mix G/A Protection & Health: 14.2% G/A Savings: 2.5% Unit-Linked: 4.7% Mutual funds & other: 6.9% Margin on revenues 1 x Euro 5,1
Slide 77: L&S | Margin analysis: Unit-Linked management fees
2 L&S | Margin Analysis Unit-Linked management fees Details of margin on Unit-Linked assets Average management fees on Unit- Linked reserves 149 bps 0 bp Unit-Linked management 0bp business mix -1bp country mix fees x Euro 2,777 million +2% Margin on assets 1 Unit-Linked average reserves + Euro 5,
Slide 78: L&S | Margin analysis: investment margin
2 L&S | Margin Analysis Investment margin Details of margin on General Account assets Unit-Linked management fees Euro 2,777 million +2% Average management fees on Margin on assets 1 + general account reserves Euro 5,990 million +3% 79 bps 0 bp 1. Including other fees (mainly mutual General acco
Slide 79: L&S | Margin analysis: technical margin
2 L&S | Margin Analysis Technical margin Details of technical margin Mortality & morbidity margin and other 1 Euro 1,667 million +19% Technical margin + Euro 609 million -12% GMxB Variable Annuity margin Euro -1,058 million -61% In Euro billion o/w basis -100 o/w volatility (equity and interes
Slide 80: L&S | Margin analysis: gross technical margin
2 L&S | Margin Analysis Focus on gross technical margin Gross mortality, morbidity & surrender margin (pre-tax, pre-DAC) In Euro million FY15 mortality, morbidity and surrender margin evolution 1,667 mainly explained by: 1,324 • Euro +0.2 billion in the US from an accounting reclassification, fully
Slide 81: L&S | Underlying earnings by business
3 L&S | Underlying Earnings by business 1 Euro million FY14 FY15 % change on comp. basis G/A Protection & Health 2,133 2,303 +2% G/A Savings 840 822 -4% Unit-Linked 1,048 1,296 +10% Mutual funds & Other 85 97 +7% Pre-tax Underlying Earnings 4,105 4,518 +3% Tax and Minority interest -973 -1,015 Under
Slide 82: L&S | FY15 margin analysis by business
3 L&S | FY15 Margin analysis by business G/A Protection Mutual Funds In Euro million G/A savings Unit-Linked & Health & Other Margin on 9% 3,898 291 846 144 revenues of GWP Investment 79 bps 964 1,585 178 57 margin of avg. G/A reserves Management 149 bps 0 0 2,777 0 fees of avg. UL reserves Technica
Slide 83: L&S | G/A Protection & Health
3 L&S | Margin Analysis by business G/A Protection & Health Technical result Net investment margin In Euro million Comp. In Euro million Comp. FY15 FY15 Change1 Change 1 Protection & Health average Protection & Health GWP 27,453 +1% 170,423 +5% reserves x x Protection & Health Protection & Health 95
Slide 84: L&S | G/A Protection & Health combined ratio
3 L&S | Margin Analysis by business G/A Protection & Health – Details on Combined Ratio Combined ratio Expense ratio1 Expense ratio deteriorated by 0.4 point: +0.1 pt - Higher commissions in France in line with business growth 95.3% 95.4% Expense - Higher VBI amortization in Switzerland 14.4% 14.6%
Slide 85: L&S | G/A Savings
3 L&S | Margin Analysis by business G/A Savings In Euro million Comp. Comp. FY15 FY15 Change 1 Change 1 G/A Savings G/A Savings 11,612 -7% 181,459 +1% revenues Average reserves x x Margin on G/A Savings 2.5% +0.7 pt 87 bps -2 bps G/A Savings Investment spread Comp. FY15 Change1 Margin on Technical m
Slide 86: L&S | Unit-Linked
3 L&S | Margin Analysis by business Unit-Linked Comp. Comp. In Euro million FY15 FY15 change 1 change 1 Unit-Linked Unit-Linked 18,039 +2% 186,946 +2% revenues Average reserves x x Average margin on UL average 4.7% +0.5 pt 149 bps 0 bp UL revenues Management fees Comp. FY15 1 change Margin on Unit-L
Slide 87: L&S | Focus on the US
4 L&S | Focus on the US US Variable Annuity GMxB Underlying Earnings In Euro million, net of DAC and tax1 FY122 FY13 FY14 FY15 Total Variable Annuity base fees & other, less expenses 270 338 2963 381 GMxB hedge margin -156 -50 -74 -13 o/w Basis -16 -1 -26 -12 Strengthening of o/w Volatility -59 -15
Slide 88: Property & Casualty
Property & Casualty
Slide 89: P&C | Revenues and net new contracts
P&C | Revenues and net new contracts FY15 P&C revenues by region FY15 P&C personal net new contracts High growth markets In Euro billion In thousands Direct Mature markets Direct +506 +7% +311 France Asia +366 2.7 0% +213 +8% 1.1 6.0 -18 -508 MedLA 7.5 UK & Ireland -1% 4.8 +5% -392 NORCEE -534 9.1 +
Slide 90: P&C | Underlying earnings analysis
P&C | Underlying Earnings analysis Net technical result Net investment income In Euro million In Euro million FY15 Change FY15 Change Revenues 31,265 +1% Average P&C assets 60,909 +6% X X 1 3 Combined ratio (in %) 96.2% - 0.6 pt Average Asset Yield 3.3% -0.5 pt Net technical result2 1,175 +21% Net i
Slide 91: P&C | Details on combined ratio
P&C | Details on Combined Ratio Combined ratio Expense ratio roll-forward 26.0% +0.2pt 26.1% -0.1pt 96.9% 96.2% FY14 Acquisition Administrative FY15 Expense Expenses Expenses 26.0% 26.1% Ratio +0.1 pt change on a comparable basis* Loss ratio roll-forward Loss 70.9% 70.1% Ratio +1.0pt 70.9% 70.1% -1.
Slide 92: P&C | Details on current year loss ratios
P&C | Details on current year loss ratios Personal Motor Personal non Motor +0.8pt 75.9% +2.5pts 74.6% 63.2% -0.3pt -0.5pt +0.6pt 62.1% -1.7pts +0.3pt o/w Turkey +0.7pt -1.5pts FY14 CY Nat Cat Price effect Frequency & Other1 FY15 CY FY14 CY Nat Cat Price effect Frequency & Other1 FY15 CY loss ratio
Slide 93: P&C | Focus on reserve developments
P&C | Focus on reserve developments Prior year reserve development level (in % of gross earned premiums) 5.4% 5.4% 3.1% 2.7% 1.7% 1.4% 1.2% 1.2% 0.9% 1.0% 0.6% 0.3% FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 Reserving ratio (Net technical reserves/Net earned premiums) 193% 193% 186%
Slide 94: P&C | Focus AXA Turkey
P&C | Focus AXA Turkey Revenues Underlying Earnings In Euro million Group share, in Euro million +11% excl. FY14 FY15 Motor TPL 0%* 1,019 21 -236 984 o/w FY15 effect of reserve strengthening: Euro 252 million • Euro 57 million related to IBNR (current year) • Euro 195 million in prior years (pending
Slide 95: Asset Management
Asset Management
Slide 96: Asset Management | Underlying earnings
ASSET MANAGEMENT | Underlying Earnings Details of Asset Management margin analysis Margin1 Expenses1 In Euro million In Euro million FY15 Change2 FY15 Change2 3 Asset Management Asset Management fees 3,539 +2% 2,562 +2% expenses Distribution revenues 756 +5% Investment result -11 -64% Distribution e
Slide 97: Asset Management | Revenues details
ASSET MANAGEMENT | Underlying Earnings Details on Asset Management revenues Asset management fees on Average Assets under Management 31 bps -1 bp Asset Management fees Euro 3,328 million +1% x o/w perfomance fees Euro 71 million ( -31% ) Average Assets under Management o/w research fees Euro 441 mil
Slide 98: Balance Sheet
Balance Sheet
Slide 99: Balance sheet contents
BALANCE SHEET 1 GENERAL ACCOUNT INVESTED ASSETS B47 1.0 Focus on Oil & Gas B48 1.0 Focus on Mining, Iron & Steel B49 1.1 Government bonds & related B50 1.1 Focus on exposure to Eurozone peripheral countries B51 1.2 Corporate bonds B52 1.2 Focus on banking corporate bonds B54 1.3 Focus on CDS B55 1.4
Slide 100: General account invested assets
GENERAL ACCOUNT INVESTED ASSETS Invested assets (100%) FY14 FY14 % % FY15 % in Euro billion Published Restated1 Changes in Fixed income 437 84% 437 84% 457 83% asset mix Forex: positive impact o/w Govies and related 246 47% 216 42% 225 41% from the strengthening of USD, CHF, JPY, o/w Corporate bonds
Slide 101: Focus on Oil & Gas
1.0 FOCUS ON OIL & GAS As of December 31, 2015 Total assets Euro 552 billion BBB+ and BBB 28% Mainly invested in BBB- A- and above (i) midstream companies less 9% exposed to oil prices 54% (ii) state-owned companies Oil & Gas fixed income1 Below investment Euro 12.1 billion2 grade Mainly invested in
Slide 102: Focus on mining, metals and steel
1.0 FOCUS ON MINING, METALS AND STEEL As of December 31, 2015 Total assets Euro 552 billion BBB- Mainly invested in large international corporations 34% More than 75% of exposure maturing within 5 years BBB and BBB+ Below investment 27% Mining, metals grade No significant exposure and steel 12% beyo
Slide 103: Government bonds and related
1.1 GOVERNMENT BONDS AND RELATED Breakdown by geography Breakdown by segment Other2 Austria Netherlands 1% 3% 2% P&C 10% Supranational Institutions Ireland 3% 2% Switzerland France L&S 6% 20% 89% Spain 7% Japan Gross1 unrealized capital Other 12% 7% gains and losses In Euro billion US 9% Germany 43.
Slide 104: Focus on exposure to Eurozone peripheral countries
1.1 GOVERNMENT BONDS AND RELATED FOCUS ON EXPOSURE TO EUROZONE PERIPHERAL COUNTRIES Exposure by issuer Gross book value Gross book value Gross book value Gross market value in Euro billion December 31, 2014 June 30, 2015 December 31, 2015 December 31, 2015 Italy 19.4 18.9 18.5 22.6 Spain 11.3 12.1 1
Slide 105: Corporate bonds
1.2 CORPORATE BONDS Breakdown by industry Breakdown by segment Other2 Technology 2% 2% P&C Basic materials 4% 14% Other 2% Consumer cyclical 6% L&S 84% Energy Banks 6% 36% Other financials Gross1 unrealized capital 7% gains and losses Industrial In Euro billion 8% 8.9 7.8 Communications Consumer 8%
Slide 106: Corporate bonds breakdown by entity and rating
1.2 CORPORATE BONDS BREAKDOWN BY ENTITY AND RATING (including CDS) P = Participating NP = Non-participating in Euro billion France US Belgium Germany Switzerland Japan Other1 Total As of December 31, 2015 P NP P NP P NP P NP P NP NP P NP P NP AAA 2.2 1.0 0.2 0.4 0.1 0.1 7.7 1.0 6.0 0.9 0.5 0.3 0.4 1
Slide 107: Focus on banking corporate bonds
1.2 FOCUS ON BANKING CORPORATE BONDS As of December 31, 2015 Gross market value Senior debt Subordinated debt Non Lower Upper Total in Euro billion Secured Tier 1 Preferred secured Tier 2 Tier 2 Total corporate bonds Euro 190 billion By rating: AAA 19.3 0.0 0.1 0.0 0.0 0.0 19.4 AA 9.1 6.2 0.2 0.0 0.
Slide 108: Focus on CDS
1.3 FOCUS ON CDS CDS mainly used as alternative to investment grade corporate bonds • Net CDS exposure excluding NBT strategy mainly corresponds to an “overlay” strategy (synthetically replicate corporate bonds by selling CDS on top of government bonds to enhance return) • NBT strategy: buy credit d
Slide 109: Asset backed securities
1.4 ASSET BACKED SECURITIES Breakdown by asset type1 Breakdown by rating Mortgage-backed Other asset-backed Prime Residential 4% CDO 5% Non rated/Equity Below 5% Consumer ABS2 investment 3% grade Commercial MBS 12% 8% CLO BBB US Subprime, 74% 3% Alt-A & NC RMBS A AAA 7% 8% 52% AA 20% Total: Euro 10
Slide 110: Listed equity portfolio overview
1.5 LISTED EQUITY PORTFOLIO OVERVIEW Breakdown by geography Breakdown by segment Other2 4% P&C 22% Rest of the World 14% France L&S Other Eurozone 23% countries 73% 9% UK Gross1 unrealized capital 5% gains and losses Japan US 6% 22% In Euro billion Belgium 3.4 3.4 6% Switzerland 6% Germany 10% Total
Slide 111: Shareholders' exposure to listed equity
1.5 SHAREHOLDERS’ EXPOSURE TO LISTED EQUITY Estimated shareholders’ exposure to listed equity (in Euro billion) FY14 FY15 18 20 7 8 Gross Group share Gross Group share nominal 100% net of hedge, nominal 100% net of hedge, tax & PB tax & PB B58 | Full Year 2015 Earnings | Appendices | February 25, 20
Slide 112: Real estate investments
1.6 REAL ESTATE INVESTMENTS Defensive portfolio with good performance over the long term Breakdown by geography Breakdown by segment Other Other Eurozone countries 2% P&C 6% 12% UK 5% France L&S Belgium 30% 88% 10% Japan 1% Breakdown by type US 1% France Switz. Belgium Germany Others Office 38% 43%
Slide 113: Hedge fund investments
1.7 HEDGE FUND INVESTMENTS Diversified portfolio of hedge funds AXA portfolio return drivers Well diversified exposure Alternative Credit : 8 managers Relative value credit Multi-Strategy 18% Alternative Credit programme programme 42% Short dated carry 58% 44% Deep value credit 25% Real asset cash f
Slide 114: Private equity investments
1.8 PRIVATE EQUITY INVESTMENTS Diversified portfolio built over the long run Breakdown by geography Breakdown by expertise 14% 5% Infrastructure Venture Other Japan 7% 2% 12% Private debt 69% Buy-out US 34% Diversified portfolio Europe 57% 57% Funds of funds 43% Direct Market value: Euro 9 billion A
Slide 115: Mortgage loans & other
1.9 MORTGAGE LOANS & OTHER Low risk mortgage loan portfolio FY15 market value by entity1 36% 23% Switzerland Germany France Other 10% 8% 51% Residential 87% Residential 49% Commercial 13% Commercial Germany 23% 10% 23% United States France US 5% 33% Agricultural Residential 23% 95% 67% Commercial Co
Slide 116: Focus on net unrealized capital gains
2 FOCUS ON NET UNREALIZED CAPITAL GAINS Balance sheet net unrealized Off balance sheet net unrealized capital gains1 capital gains In Euro billion In Euro billion 15.3 2.0 12.8 2.4 1.7 Equities & Other 2 1.6 Corporate bonds Government bonds 5.3 and related 4.1 Real Estate and loans 3 10.9 9.5 FY14 p
Slide 117: Asset & liability management (1/2)
3 ASSET & LIABILITY MANAGEMENT (1/2) L&S General Account investment spreads and margin Inforce business New business Spread above Resilient investment Spread above guaranteed rates margin1 guaranteed rate +160 bps 80 bps 79 bps Guidance: 3.6% 70-80 bps +160 bps 2.1% 2.0% 0.5% FY15 FY14 FY15 FY15 Yie
Slide 118: Asset & liability management (2/2)
3 ASSET & LIABILITY MANAGEMENT (2/2) L&S General Account investment spreads for main entities Inforce New business 3.9% 320bps 2.0% 200bps • Average G/A reserves: Euro 102 billion • G/A Savings new business sales with France 0.7% 0.0% long term guarantees stopped in 1998 FY15 FY15 40bps 130bps 3.7%
Slide 119: Net financial debt - long-term maturities
4 NET FINANCIAL DEBT - LONG-TERM MATURITIES Net financial debt Contractual maturity breakdown In Euro billion In Euro billion Debt 2.2 24% 23% gearing 3.0 13.5 14.3 0.3 6.6 1.7 0.3 2.5 0.5 9.1 9.5 2016 2017 2018 2019 2020 2021- 2026- Undated 2025 2040 Economic maturity breakdown In Euro billion 6.8
Slide 120: Solvency II ratio
SOLVENCY II RATIO Solvency II ratio Key sensitivities In Euro billion Ratio as of Dec 31, 2015 205% 201% 205% Solvency II ratio Interest rate +50bps 207% +2 pts 59.2 54.3 Interest rate -50bps 197% -8 pts 28.8 Corporate spreads +75bps 205% 0 pt 27.0 Available capital Equity markets +25% 208% +3 pts R
Slide 121: Solvency II required capital
5 SOLVENCY II REQUIRED CAPITAL SPLIT BY RISK. GEOGRAPHY & BUSINESS Required capital by risk Required capital by business Operational Counterparty Holdings & Other 5% 10% Property & 18% 24% Casualty Asset Market 4% Management 41% & Banking P&C 21% Life & Savings 23% 54% Life Required capital by geogr
Slide 122: Shareholders' equity to Solvency II AFR
5 SHAREHOLDERS’ EQUITY TO SOLVENCY II AFR In Euro billion IFRS 68 Shareholders’ Equity1 Full market value Move to full market value of assets +5 of assets • Real estate (Euro +4.9 billion) • Loans (Euro +0.3 billion) Remove intangible assets Intangible assets -32 • Goodwill (Euro -17 billion) • DAC
Slide 123: Life & Savings embedded value
6 LIFE & SAVINGS EMBEDDED VALUE 1.0 -1.6 1.2 54.2 2.5 2.7 0.5 -1.7 49.5 FY14 Transition Modelling Existing New business Operational Economic & Forex & other FY15 to Solvency changes & business value variance1 non-operating II in EEA opening contribution variance adjustment 1, Operational variances i
Slide 124: Life & Savings embedded value and operating FCF
6 LIFE & SAVINGS EMBEDDED VALUE AND OPERATING FCF o/w o/w Required Free Change L&S ANAV Surplus = VIF + = capital + In EUR billion EV (included in (included in ANAV) ANAV) Opening 49.5 25.3 24.3 16.4 7.9 (Dec. 31, 2014) FY15 Life & Savings Free Cash Flow Modeling adj. breakdown -1.2 -1.5 0.3 -3.0 3.
Slide 125: Life & Savings NBV & EV - key sensitivities
6 LIFE & SAVINGS NBV & EV - KEY SENSITIVITIES Embedded Value (EV) Sensitivities New Business Value (NBV) Sensitivities In Euro billion In Euro million L&S EV as at Dec 31, 2015 54.2 L&S NBV as at Dec 31, 2015 2,490 Interest rate +100 bps 56.1 +1.8 | +4% Interest rate +100 bps 2,551 +67 | +3% Interes
Slide 126: Life & Savings internal rate of return by country
7 LIFE & SAVINGS INTERNAL RATE OF RETURN (IRR) BY COUNTRY FY14 FY15 In Euro million APE NB IRR APE NB IRR NB IRR Solvency I basis Solvency I basis Solvency II flows1 France 1,584 9.7% 1,767 10.5% 18.4% US 1,355 24.2% 1,656 17.3% 17.3% UK 704 6.3% 935 4.7% 4.7% Japan 361 11.9% 418 12.9% 12.9% NORCEE
Slide 127: L&S operating free cash flow by country
7 L&S OPERATING FREE CASH FLOW BY COUNTRY FY14 FY15 Solvency I Solvency II In Euro million L&S operating free L&S operating free cash flows cash flows1 France 750 855 US 542 657 UK (1) 18 Japan 215 279 NORCEE 824 800 o/w Germany 180 217 o/w Switzerland 345 328 o/w Belgium 241 211 MedLA 123 211 Asia
Slide 128: Life & Savings free cash flow emergence
7 LIFE & SAVINGS FREE CASH FLOW EMERGENCE FROM INFORCE AND NEW BUSINESS Expected undiscounted cash Expected undiscounted cash flows flows from 2015 inforce1 business from 2015 New Business In Euro billion In Euro billion 35 2.0 30 1.5 25 1.0 20 0.5 2015 15 0.0 1-5 6-10 11-15 16-20 21-25 26-30 31-35
Slide 129: Dividend accrual and debt gearing: change in methodology
DIVIDEND ACCRUAL AND DEBT GEARING: CHANGE IN METHODOLOGY TO ALIGN WITH INDUSTRY PRACTICE Dividend accrual reflected in Solvency II ratio Starting 1Q16, Solvency II ratio will reflect dividend accrual on a quarterly basis (previously at year end only) Moving from net to gross Debt gearing Starting 1H
Slide 130: Corporate Responsibility
Corporate Responsibility
Slide 131: Main SRI ratings
MAIN SRI RATINGS 2014 Sector leader, Ranked “A+” in the 2015 Included in the CDP Climate ranked 1st out of 37. “Assessment Report” Disclosure Leadership Included in Vigeo Euronext (Responsible Investment Index, with a score of indices strategy) 98/100 Score: 83/100 General score: 87/100 Percentile r
Slide 132: Responsible investment strategy
RESPONSIBLE INVESTMENT STRATEGY “ESG + CARBON” INTEGRATION SECTOR GUIDELINES IMPACT INVESTING Long-term ESG integration Implementation of investment Euro 200 million “impact process guidelines for sectors with acute investment” fund of funds environmental or ethical launched in 2013 seeking to creat