Axa Sa · EURONEXT:CS
Axa Sa — H1 2022 Earnings Presentation
38 slides from Axa Sa's earnings presentation, Aug 3, 2022
Slide 1: Half Year 2022 Earnings
Half Year 2022 Earnings Press conference August 3, 2022
Slide 2: Important legal information and cautionary statements
IMPORTANT LEGAL INFORMATION AND CAUTIONARY STATEMENTS CONCERNING FORWARD LOOKING STATEMENTS AND THE USE OF NON-GAAP FINANCIAL MEASURES Certain statements contained herein may be forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, tr
Slide 3: Agenda
Agenda 1 Introduction Thomas Buberl, Group CEO 2 Business performance Frédéric de Courtois, Group Deputy CEO 3 Financial performance Alban de Mailly Nesle, Group CFO 4 Conclusion Thomas Buberl, Group CEO 3 Half Year 2022 Earnings | August 3, 2022
Slide 4: 1 Introduction
1 Introduction Thomas Buberl Group CEO 4 Half Year 2022 Earnings | August 3, 2022
Slide 5: Very good performance in the first half of 2022
Very good performance in the first half of 2022, demonstrating the strength of AXA’s strategy REVENUES € 55bn +1% vs 1H21 • High quality of revenue growth UNDERLYING EARNINGS € 3.9bn • Strong increase in operational performance in our markets +4% vs 1H21 • Very high level of financial strength allow
Slide 6: High quality revenue growth and very good profitability in our business lines
High quality revenue growth and very good profitability in our business lines Revenues 1H22 vs. 1H21 ASSET P&C HEALTH LIFE & SAVINGS MANAGEMENT € 29.3bn € 8.8bn €16.0bn € 0.8bn +1% +13% -5% +4% Combined ratio Combined ratio NBV margin Cost income ratio 93.7% 94.9% 40.3% 64.7% GROUP TOTAL €55bn +1 %
Slide 7: Strong operational growth across all our markets
Strong operational growth across all our markets Underlying earnings 1H22 vs. 1H21 FRANCE EUROPE ASIA €1.0bn €1.5bn €0.7bn GROUP TOTAL +7% +6% +8% €3.9bn +4% AXA IM AXA XL €0.2bn €0.7bn +3% +1% 7 Half Year 2022 Earnings | August 3, 2022 All notes are on pages 36, 37 & 38 of this document.
Slide 8: Committed to develop new services to meet our customers' evolving needs
Committed to develop new services to meet our customers’ evolving needs INNOVATION CLIMATE • Launch of the Digital Commercial Platform • AXA Climate School Build an ecosystem of new services to meet the Already 50 corporate clients have leveraged new protection needs of corporate clients. this train
Slide 9: Above target on Driving Progress 2023 plan key financial indicators
Above target on Driving Progress 2023 plan key financial indicators +11% 15.8% 227% € 5-6bn UEPS GROWTH RETURN ON EQUITY SOLVENCY II RATIO CASH REMITTANCE vs 1H21 in 1H22 +10 pts vs FY21 on track for 2022 Driving Progress 2023 Driving Progress 2023 Driving Progress 2023 Driving Progress 2023 target
Slide 10: Executing on our capital management strategy in 1H22
Executing on our capital management strategy in 1H22 KEY MILESTONES ACHIEVED COMMITTED TO DISCIPLINE ON CASH DEPLOYMENT • Announced disposal of Euro 16 billion of • Euro 1 billion share buy-back G/A reserves in-force portfolio in Germany1 announced today2, according to our capital management policy
Slide 11: Resilient and well positioned in the current environment
Resilient and well positioned in the current environment BUSINESS PROFILE RESILIENT TO ECONOMIC CYCLES +4% P&C commercial lines insurance revenues with favourable pricing, strong growth in Health revenues STRONG POSITION TO WITHSTAND MARKET VOLATILITY Solvency II ratio at 227%, reduced rate sensitiv
Slide 12: 2 Business performance
2 Business performance Frédéric de Courtois Group Deputy CEO 12 Half Year 2022 Earnings | August 3, 2022
Slide 13: P&C Revenues | Continued favorable pricing in Commercial lines insurance
P&C Revenues | Continued favorable pricing in Commercial lines insurance In Euro billion REVENUES +1% COMMERCIAL LINES PRICING1 • Growth in Commercial lines insurance AXA XL Ins 8.4 -1% +9%2 29.3 from favorable pricing 28.0 AXA XL Re 2.2 -21% +8%2 • Continued selectivity at AXA XL France 2.1 +6% +5%
Slide 14: P&C Combined Ratio | Excellent underwriting margin across the Group
P&C Combined Ratio | Excellent underwriting margin across the Group Incl. ca. -1.3% from Motor frequency benefits in 1H21 +0.7pt ALL YEAR COMBINED RATIO BY GEOGRAPHY at constant FX 93.3% 93.7% Nat Cat 4.1% 4.2% • Net impact related to the war in Ukraine 1H22 Change (€0.3bn) fully absorbed at AXA XL
Slide 15: P&C Profitability | +4% earnings growth with higher investment income
P&C Profitability | +4% earnings growth with higher investment income and a resilient combined ratio In Euro million UNDERLYING EARNINGS +4% 2,374 • Lower underwriting result following 100 -23 the non-repeat of elevated frequency 2,209 benefits and the impact of the Ukraine 216 war -126 • Higher inv
Slide 16: L&S Revenues | High quality net flows
L&S Revenues | High quality net flows, revenues impacted by non-repeat of exceptional sales in 1H21 In Euro billion REVENUES -5% REVENUES BY GEOGRAPHY • Non-repeat of a large Unit-Linked Group France 7.0 -7% 16.9 contract in France (€0.3bn) 16.0 Europe 5.0 -6% • Challenging market conditions in Ital
Slide 17: APE and NBV | Resilient new business trends
APE and NBV | Resilient new business trends In Euro billion APE1 NBV1 0% +6% NBV margin1 1.3 1.3 3.3 3.0 1H21 1H22 Protection +11% 2.2 48% and Health2 NBV MARGIN -2.4pts Unit-Linked -11% 0.4 41% 44.7% 40.3% Capital light G/A -17% 0.3 25% Traditional G/A +35% 0.3 1% 1H21 1H22 1H21 1H22 17 Half Year 2
Slide 18: L&S profitability | Growth driven by higher fees and strong investment margin
L&S profitability | Growth driven by higher fees and strong investment margin In Euro million UNDERLYING EARNINGS +7% (or +9% at constant scope1) 19 60 1,325 • Higher fees net of expenses from -23 growth in Protection and resilient 35 20 Unit-Linked fees 1,216 • Resilient investment margin at 70bps
Slide 19: Health Revenues | Strong growth dynamics across all geographies
Health Revenues | Strong growth dynamics across all geographies In Euro billion REVENUES +13% GROUP • Strong growth momentum in International France 3.0 +28% 8.8 Group business in France driven by large Europe 0.8 +10% 7.9 contracts Asia 0.2 +11% • Growth in Europe mainly from higher volumes in UK &
Slide 20: Health Profitability | Strong volume growth partly offset by disposals
Health Profitability | Strong volume growth partly offset by disposals In Euro million UNDERLYING EARNINGS +2% 14 • Higher technical result from strong 402 volume growth, partly offset by higher 11 -4 -6 Covid related claims in Japan 386 • Higher investment income mainly from Europe • Impact from th
Slide 21: Asset Management | Robust net inflows with a favorable mix
Asset Management | Robust net inflows with a favorable mix In Euro billion ASSETS UNDER MANAGEMENT NET INFLOWS BY PLATFORM +8.7 +7.8 -7% 910 +14 JVs +6 844 +1.1 -86 AXA IM Alts -3.7 Alts Core JVs Architas AXA IM Core NET INFLOWS BY CLIENT +7.8 +6.6 Architas FY21 Net flows Market FX 1H22 effect -0.6
Slide 22: Asset Management | Earnings growth from higher revenues & cost discipline
Asset Management | Earnings growth from higher revenues & cost discipline In Euro million REVENUES COST INCOME RATIO UNDERLYING EARNINGS +4% -1.1pt +3% 788 65.3% 64.7% 203 752 194 1H211 1H22 1H211 1H22 1H211 1H22 Management 17.1 17.8 fee bps 22 Half Year 2022 Earnings | August 3, 2022 All notes are
Slide 23: 3 Financial performance
3 Financial performance Alban de Mailly Nesle Group CFO 23 Half Year 2022 Earnings | August 3, 2022
Slide 24: Underlying earnings | Strong 1H22 performance
Underlying earnings | Strong 1H22 performance UNDERLYING EARNINGS UNDERLYING EARNINGS PER SHARE In Euro million In Euro +4% +11% 3,918 1.65 +4% 3,643 1.48 +7% from organic growth1 from earnings growth +4% Strong earnings growth across all lines of business -3% from capital management linked to dispo
Slide 25: Net income | Slightly higher than Underlying earnings
Net income | Slightly higher than Underlying earnings In Euro million Stable Underlying earnings 3,918 3,996 4,108 Gains/losses on financial assets +490 o/w Net realized capital gains +279 o/w Change in fair value and Forex 1 +211 Exceptional and discontinued operations +41 Integration and restructu
Slide 26: Shareholders' equity | Higher interest rates impacting unrealized capital gains
Shareholders’ equity | Higher interest rates impacting unrealized capital gains In Euro billion 71.1 FY21 Shareholders' equity 71.1 52.6 Change in net unrealized capital gains1 -19.9 Net income for the period +4.1 Dividend (paid in May 2021) -3.5 Share buy-back -1.3 Change in pension benefits +1.7 U
Slide 27: Solvency II | Ratio at 227%, up 10pts vs FY21
Solvency II | Ratio at 227%, up 10pts vs FY21 with reduced rate sensitivity In Euro billion SOLVENCY II RATIO1 KEY SENSITIVITIES2 217% 227% Ratio as of June 30, 2022 227% 62.0 63.0 Interest rate +50bps +6 pts Interest rate -50bps -8 pts3 Corporate spreads +50bps -3 pts Eligible Own Funds (EOF) Solve
Slide 28: Investments | Capitalizing on higher rates
Investments | Capitalizing on higher rates REINVESTMENT YIELD P&C YIELD2 L&S INVESTMENT MARGIN3 3.4% 2.9% 70 bps 67 bps 2.6% 2.4% 1.9% Core Alternative1 1H22 1H21 1H22 1H214 1H22 Government bonds Average rating: AA Corporate bonds Average rating: A Alternative Average rating: A 28 Half Year 2022 Ear
Slide 29: Debt | Credit rating upgraded
Debt | Credit rating upgraded reflecting the transformation of AXA SA into the Group’s internal reinsurer RATING AGENCIES RECOGNIZING THE BENEFITS OF AXA SA’S TRANSFORMATION DEBT GEARING IN 1H22 26.4% 26.9% AXA SA Financial issuer credit Rating strengh Rating from to A A+ AA- Stable outlook A2 A1 AA
Slide 30: 4 Conclusion
4 Conclusion Thomas Buberl Group CEO 30 Half Year 2022 Earnings | August 3, 2022
Slide 31: Very good performance in the first half of 2022
Very good performance in the first half of 2022, demonstrating the strength of AXA’s strategy High quality of revenue growth Strong increase in operational performance in our markets Very high level of financial strength Confidence in achieving Driving Progress 2023 strategic plan key objectives des
Slide 32: Q&A session
Q&A session 32 Half Year 2022 Earnings | August 3, 2022
Slide 33: Merci
Merci 33 Half Year 2022 Earnings | August 3, 2022
Slide 34: AXA is a recognized sustainability leader
AXA is a recognized sustainability leader 2021: 4th place Sector Leader Score: 87/100 2021 score: AAA 2021 score: A- 1st / 51 insurance companies in 2022 In DJSI Europe & DJSI World indexes Included in Euronext Vigeo indices DJSI accounts for 10% of performance conditions of AXA’s shares for top man
Slide 35: Scope and definitions
Scope and definitions France: includes insurance activities, banking activities and holdings in France. Europe: includes Switzerland (insurance activities), Germany (insurance activities and holdings), Belgium (insurance activities and holdings), United Kingdom and Ireland (insurance activities and
Slide 36: Notes (1/3)
Notes (1/3) Changes at comparable basis are constant Forex, scope and methodology for activity indicators, and at constant Forex for earnings, unless otherwise specified. Page 5 1. Change on a reported basis. 2. The Solvency II ratio is estimated primarily using AXA’s internal model calibrated based
Slide 37: Notes (2/3)
Notes (2/3) Changes at comparable basis are constant Forex, scope and methodology for activity indicators, and at constant Forex for earnings, unless otherwise specified. Page 16 1. Capital light products are General Account Savings products which, at inception, create more Eligible Own Funds (EOF)
Slide 38: Notes (3/3)
Notes (3/3) Changes at comparable basis are constant Forex, scope and methodology for activity indicators, and at constant Forex for earnings, unless otherwise specified. Page 27 1. The Solvency II ratio is estimated primarily using AXA’s internal model calibrated based on an adverse 1/200 years sho