Assicurazioni Generali S.p.a. · MIL:G
Assicurazioni Generali — H1 2022 Earnings Presentation
46 slides from Assicurazioni Generali's earnings presentation, Jul 29, 2022
Slide 1: Generali Group 2022 First Half Results
GENERALI GROUP 2022 FIRST HALF RESULTS The like for like change of written premiums and life net cash inflows is on equivalent terms (on equivalent exchange rates and consolidation area). Operating result, Asset Under Management and Life technical provisions exclude assets under disposals or dispose
Slide 2: Agenda
2 AGENDA 01. STRATEGY OVERVIEW 02. 2022 FIRST HALF GROUP FINANCIALS 03. BACKUP
Slide 3: Strategy Overview
3 STRATEGY OVERVIEW PHILIPPE DONNET – GROUP CEO 01
Slide 4: Key Messages
4 KEY MESSAGES Solid performance with continued growth in the Operating Result Resilient Life net inflows supported by Protection and Unit Linked Strong growth in Non-Motor P&C, a key focus of the ‘Lifetime Partner 24’ strategic plan Sound progress on M&A with integration of acquisitions fully on tr
Slide 5: Solid performance with continued growth in operating result and strong capital position
5 SOLID PERFORMANCE WITH CONTINUED GROWTH IN THE OPERATING RESULT AND A STRONG CAPITAL POSITION OPERATING RESULT (€ m) NET RESULT 1 (€ m) SOLVENCY RATIO (%) +4.8% -9.0% +6 p.p. 2,996 3,140 233 1,540 1,402 227 1H 2021 1H 2022 1H 2021 1H 2022 FY 2021 1H 2022 P&C PREMIUMS2, 3 (€ m) LIFE NEW BUSINESS MA
Slide 6: Sound progress on M&A with integration of acquisitions on track
6 SOUND PROGRESS ON M&A WITH INTEGRATION OF ACQUISITIONS FULLY ON TRACK TRANSACTION STATUS UPDATE RATIONALE ▪ Reached the threshold of 95% of the company’s share capital ▪ Consolidate leadership position in Italy ▪ Outstanding ordinary shares to be now ▪ Enhanced product offering, distribution CATTO
Slide 7: Save the Date
7 SAVE THE DATE DECEMBER 13, 2022 Investor update with a focus on new accounting standards Virtual meeting
Slide 8: 2022 First Half Group Financials
8 2022 FIRST HALF GROUP FINANCIALS CRISTIANO BOREAN – GROUP CFO 02
Slide 9: 2022 First Half Results at a Glance
9 2022 FIRST HALF RESULTS AT A GLANCE VOLUMES 1H21 1H22 D LFL1 Gross Written Premiums (€ m) 38,093 41,880 +2.4% Life (€ m) 25,791 27,298 -0.5% P&C (€ m) 12,301 14,582 +8.5% Life Net Inflows (€ m) 6,306 6,240 -7.9% Life Technical Reserves (€ m) 424,475 419,183 -1.2% PROFITABILITY 1H21 1H22 D Operatin
Slide 10: Operating Result Growing Thanks to Business Diversification
10 OPERATING RESULT GROWING THANKS TO BUSINESS DIVERSIFICATION (€ m) +4.8% 247 38 85 3,140 2,996 (17) (208) 1H21 Life P&C A&WM Holding & Other Consolidation 1H22 businesses Adjustments 1H22 1,689 1,294 503 121 (467) 3,140 1H21 1,442 1,256 520 37 (259) 2,996 D +17.1% +3.0% -3.3% n.m. +80.5% +4.8%
Slide 11: Successful Steering of Life Profitability
11 SUCCESSFUL STEERING OF LIFE PROFITABILITY VOLUMES (€ m) 1H21 1H22 Δ LFL1 Gross Written Premiums 25,791 27,298 -0.5% Net Inflows 6,306 6,240 -7.9% PVNBP 24,516 23,573 -7.5% PROFITABILITY 1H21 1H22 D Life Operating Result 1,442 1,689 +17.1% Life Operating Result on Life Technical Reserves 0.37% 0.4
Slide 12: Strong Increase in Life Operating Result
12 STRONG INCREASE IN LIFE OPERATING RESULT +17.1% (€ m) 126 386 1,689 ▪ Technical margin growth driven by the 1,442 (265) ongoing shift of our mix towards Protection and Unit Linked businesses ▪ Investment result improving vs last year, mainly thanks to higher current income and intragroup dividend
Slide 13: Continued Inflows in Preferred Lines of Business
13 CONTINUED INFLOWS IN PREFERRED LINES OF BUSINESS NET INFLOWS MIX BY COUNTRY (€ m) NET INFLOWS MIX BY LOB (€ m) NET INFLOWS DEVELOPMENT BY LOB (Δ1H22 / 1H21) (€ m)² 1H21 1H22 Δ LFL¹ Italy 2,055 1,526 -39.1% +685 Unit Linked France 5,019 1,048 904 -13.8% Germany Unit Linked 1,954 2,027 +3.7% Protec
Slide 14: Life Technical Reserves Affected by Financial Markets Volatility
14 LIFE TECHNICAL RESERVES AFFECTED BY FINANCIAL MARKETS VOLATILITY TOTAL LIFE RESERVES (€ bn) -1.2% CAPITAL LIGHT RESERVES ON TOTAL¹ (%) 424.5 6.2 419.2 1.6 108.7 (3.7) (9.5) 99.8 -8.2% 67.7% 67.5% +1.1% 315.8 319.4 FY21 Net Loadings, Policyholder share Exchange rate, 1H22 inflows risk & of investm
Slide 15: Excellent New Business Value
15 EXCELLENT NEW BUSINESS VALUE PVNBP (€ m) X MARGIN ON PVNBP (%) = NEW BUSINESS VALUE (€ m) 24,516 23,573 4.67% 5.23% 1,145 1,233 -7.5% +0.59 p.p. +4.3% 10,886 +13.1% 273 -16.2% 9,380 2.20% 2.91% 240 Savings 504 Protection 5,150 -8.4% 4,850 10.23% 10.39% 527 -7.9% Unit Linked +3.8% 9,344 8,480 4.46
Slide 16: Strong Profitability of Life New Business
16 16 STRONG PROFITABILITY OF LIFE NEW BUSINESS PVNBP (€ m) MARGIN ON PVNBP (%) NBV (€ m) -7.5% +4.3% -0.66 p.p. +0.59 p.p. -0.12 p.p. +0.62 p.p. -10.1% +0.2% 23,573 +1.15 p.p. 7.32% +0.2% 1,233 6.52% +0.69 p.p. -11.7% -0.9% 6.00% 5.23% 2,603 9,460 4.24% -2.1% 568 3.50% 1,209 +34.5% -2.7% +10.0% -8.
Slide 17: Life Current Return Increasing
17 LIFE CURRENT RETURN INCREASING LIFE SEGMENT GENERAL ACCOUNT (%) CURRENT RETURNS¹ €360bn €311bn €m % 3.5 1.8 3.7 3.0 3.6 2.0 4.6 4.7 1H21 3,773 1.2% 11.4 12.9 Fixed income Other 1H22 3,871 1.3% Cash & cash equivalent 1H21 183 1.3% 27.9 Equity 27.7 Real estate Equity 1H22 375 2.4% Other fixed incom
Slide 18: Strong Growth in P&C Volumes and Resilient Profitability
18 STRONG GROWTH IN P&C VOLUMES AND RESILIENT PROFITABILITY VOLUMES (€ m) 1H21 1H22 Δ LFL1 Gross written premiums 12,301 14,582 +8.5% o/w Primary Motor 4,520 5,238 +4.6% o/w Primary Non-Motor 7,273 8,766 +10.7% PROFITABILITY 1H21 1H22 Δ Combined Ratio 89.7% 92.5% +2.8 p.p. Nat Cat impact 2.0% 2.2% +
Slide 19: Resilient P&C Technical Profitability
19 RESILIENT P&C TECHNICAL PROFITABILITY Expense Ratio (%) +0.2 p.p. Combined Ratio (%) Entirely attributable to Cattolica consolidation +2.8 p.p. 28.5 0.3 28.7 89.7 0.2 2.6 92.5 4.9 5.3 0.2 (0.2) 28.5 28.7 23.6 23.4 Admin. costs Acquisition costs Excluding Argentina, the Group Combined Ratio 1H22 w
Slide 20: Strong Growth in P&C Volumes
20 STRONG GROWTH IN P&C VOLUMES Group Combined Ratio Motor 97.4% GROSS WRITTEN PREMIUMS (€ m) COMBINED RATIO (%) Non-Motor 89.5% +8.5% +3.3 p.p. +4.2 p.p. +2.8 p.p. +2.6 p.p. +4.5 p.p. 14,582 +4.1 p.p. 99.2 99.5 +4.9% -5.1 p.p. +5.1% 90.2 92.5 92.1 +50.0% +6.8% +10.3% 1,718 +2.5% 87.6 1,056 4,157 85
Slide 21: Double Digit Growth in Non-Motor Premiums
21 DOUBLE DIGIT GROWTH IN NON-MOTOR PREMIUMS +10.7% GROSS DIRECT PREMIUMS (€ m) +4.6% Motor Non-Motor 8,766 +10.6% 5,238 +10.3% +5.0% -1.2% +4.7% +6.5% 2,533 +4.3% +3.1% +18.3% +61.1% -0.5% 603 1,596 n.m. 1,512 1,397 1,390 1,176 1.085 1,010 926 765 10 Italy France Germany ACEE International Group Gr
Slide 22: P&C Operating Result Remains Healthy
22 P&C OPERATING RESULT REMAINS HEALTHY (€ m) +3.0% 189 3 1,294 1,256 ▪ Lower technical result following the increase in the Combined (155) ratio, mainly driven by higher claims frequency, impact from inflation, higher Nat Cat events as well as Man-Made losses ▪ Investment result improving thanks to
Slide 23: P&C Current Return Increasing
23 P&C CURRENT RETURN INCREASING P&C SEGMENT GENERAL ACCOUNT (%) CURRENT RETURNS¹ €44bn €42bn €m % 6.0 7.2 9.8 10.0 1H21 295 1.1% Fixed income 10.5 11.0 1H22 352 1.2% 4.7 Other 4.1 7.8 1H21 29 1.6% 8.8 Cash & cash equivalent Equity Real estate 1H22 53 2.8% Equity 30.9 28.6 1H21 85 2.2% Other fixed i
Slide 24: A&WM Segment Impacted by Market Volatility
24 A&WM SEGMENT IMPACTED BY MARKET VOLATILITY Asset & Wealth Management (€ m) 1H21 1H22 Δ Operating Result 520 503 -3.3% o/w Asset Management 306 325 +6.2% o/w Wealth Management (Banca Generali Group)¹ 214 178 -17.0% Asset Management (€ m) 1H21 1H22 Δ Operating Revenues 506 544 +7.5% o/w management
Slide 25: Strong Contribution from Other Businesses Segment
25 STRONG CONTRIBUTION FROM OTHER BUSINESSES SEGMENT¹ OPERATING RESULT (€ m) 1H21 1H22 Δ Other Businesses² 282 380 +35.0% Operating Holding Expenses (245) (259) +5.7% Total 37 121 n.m. 1. Starting from 1Q2022, Banca Generali is represented within the Asset & Wealth Management segment 2. It includes
Slide 26: From Operating to Net Result
26 FROM OPERATING TO NET RESULT Components: Components: Restructuring costs: (€41m) Net realised gains: €55m VOBA amortization: (€29m) Net impairments: (€311m) (€ m) Other Net Non Operating items: (€167m) Excluding the impact of Fair Value through P&L: €88m impairments on Russian Tax rate: 34.2%, ma
Slide 27: Shareholders Equity Impacted by Change in AFS Reserve
27 SHAREHOLDERS EQUITY IMPACTED BY CHANGE IN AFS RESERVE Shareholders’ equity rollforward (€ m) Shareholders’ equity sensitivities¹ (€ bn) 29,308 -34.9% 1,402 935 19,078 Equities -0.8 -25% (10,876) (1,691) Interest rate -2.1 Shareholders' equity Δ in 1H22 Net Result Dividend Other Shareholders' equi
Slide 28: Strong Capital Generation and Economic Variances Drive Solvency Up
28 STRONG CAPITAL GENERATION AND ECONOMIC VARIANCES DRIVE SOLVENCY UP FURTHER Excess Own Own Solvency II ratio Funds SCR Funds1 (%) (€ bn) (€ bn) (€ bn) FY2021 50.6 22.3 28.3 227% Regulatory changes 0.1 0.1 (0.1) -1%pts Normalized capital generation 2.0 0.0 2.0 +9%pts Economic variances (2.4) (1.8)
Slide 29: Final Remarks
29 FINAL REMARKS Results confirm profitable growth with excellent technical margin Strong increase in Non-Motor P&C, a key focus of our strategy Solid Solvency II supported by strong capital generation €500m share buyback to be implemented in 2H 2022
Slide 30: Backup
30 BACKUP 03
Slide 31: Argentina Hyperinflation Impact on the Group Combined Ratio
31 ARGENTINA HYPERINFLATION IMPACT ON THE GROUP COMBINED RATIO ▪ IAS29 Accounting standards apply to economies considered to be hyperinflationary. The Group has applied IAS29 to Argentina since 2018 ▪ The Group CoR public disclosure reflects the Argentinean CoR before any hyperinflation adjustment -
Slide 32: Private Equity: Pro-Forma Operating Result by Segment
32 PRIVATE EQUITY: PRO-FORMA OPERATING RESULT BY SEGMENT (€ m) 1H21 1H22 1H21 Pro- Δ 1H22 Pro- Δ forma1 forma1 Life 1,442 1,521 78 1,689 1,710 20 P&C 1,256 1,384 128 1,294 1,272 (22) Asset & Wealth management 520 546 26 503 546 44 Holding & Other 37 (257) (293) 121 (48) (169) Consolidation adjustmen
Slide 33: Reconciliation with Group Disclosure on External Clients
33 RECONCILIATION WITH GROUP DISCLOSURE ON EXTERNAL CLIENTS (€ bn) 15.2 163.6 45.4 103.1 AM External Wealth Pension Funds Group External Client Assets Management¹ & Others² Clients Assets 1. Wealth Management corresponds to Banca Generali. €45.4bn include managed and banking products AUM 2. Pension
Slide 34: Assets Under Management
34 ASSETS UNDER MANAGEMENT Breakdown by region¹ and asset class (%) 13 Italy Total Portfolio: €635bn (%) 10 35 France Germany 4 By Region ACEE International 18 Other General account 20 26 Unit Linked 59 Third party investments 5 31 7 Equity 15 Fixed income Real estate By Asset Class Cash & Cash Equi
Slide 35: Fixed Income Portfolio
35 FIXED INCOME PORTFOLIO Total Portfolio: €310bn Covered: €10bn Corporate: €89bn Government: €163bn¹ (%) (%) (%) (%) 12 5 3 8 21 5 15 3 28 30 40 42 20 57 Other fixed Income 55 20 Covered 9 Corporate non fin. AAA AA A BBB Not Investment Grade Not Rated Corporate fin. Government 53 Bond duration FY21
Slide 36: Fixed Income Portfolio by Country
36 FIXED INCOME PORTFOLIO BY COUNTRY Total Portfolio: €310bn Covered: €10bn Corporate: €89bn Government: €163bn (%) (%) (%) (%) 4 8 15 29 18 32 3 38 45 49 20 10 1 0 Other fixed Income 17 8 3 18 9 2 19 Covered Italy France Germany CEE USA Other Corporate non fin. Corporate fin. 53 Reinvestment yield
Slide 37: Equity & Equity-Like
37 EQUITY & EQUITY-LIKE Alernative funds: €14bn Equity: €9bn (%) (%) Total portfolio: €27bn (%) Life, P&C, AM 2 Life, P&C, AM 12 22 and Other and Other 2 Life Life P&C 32 P&C 76 AM AM 85 Other Other 51 Equity funds: €5bn (%) Total portfolio Life, P&C, AM 17 7 and Other 47 Quoted 53 Equity Equity Fun
Slide 38: Asset Allocation: Real Estate
38 ASSET ALLOCATION: REAL ESTATE¹ Total Portfolio: €35bn¹ Breakdown 8 Office by use2 4 Residential Breakdown by utilization² (%) Retail (%) 19 Logistic 59 Other/Mixed 12 10 Investment properties Own use Breakdown by country² (%) 88 1 Italy 20 France 31 Germany 5 CEE RoE 13 RoW 30 1. Data, at fair va
Slide 39: Exposure to Russia & Ukraine
39 EXPOSURE TO RUSSIA & UKRAINE ▪ The General Account investment exposure at 1H22 was equal to €241m at fair value (vs €683m as of FY21) and mainly composed of: ➢ 38.5% stake in the insurance unlisted company Ingosstrakh, with a fair value of €175m (vs €384m as of FY21) ➢ Direct investments in Russi
Slide 40: Focus on Financial Debt
40 FOCUS ON FINANCIAL DEBT AVERAGE COST & MATURITY OF FINANCIAL DEBT TOTAL FINANCIAL DEBT (€) FY21 1H22 10.66 bn 10.45 bn 163m 146m Average cost (%) 4.60% 4.55% Subordinated/Hybrid 4.50% 4.44% 8,760m 8,567m Senior 5.13% 5.13% Average maturity (years) 5.1 4.7 1,737m 1,738m FY21 1H22 Interest expenses
Slide 41: Debt Issuances Breakdown by Expiry Date
41 DEBT ISSUANCES BREAKDOWN BY EXPIRY DATE NOMINAL VALUE (€ m) Senior Hybrid Subordinated Subordinated Reimbursed Subordinated New Issuance 8 125 1,750 1,000 1,750 500 ¹ 302 * … 850 750 500 600 500 467 407 100 7 - - - - - 2022 2023 2024 - 2025 - 2026 2027 2028 2029 - 2030 2031 - 2032 Green bonds Sus
Slide 42: Focus on Solvency Capital Requirement
42 FOCUS ON SOLVENCY CAPITAL REQUIREMENT Pre-diversification SCR by region AG & (%) Holdings International 6% 1H22 SCR before 14% 33.4 diversification Italy 39% ACEE Diversification 8.6 9% France 17% Germany Taxes 5.2 15% Pre-diversification SCR by type of risk (%) Credit 1H22 SCR excl. Operational
Slide 43: Disclaimer
43 DISCLAIMER Certain of the statements contained herein are statements of future expectations and other forward-looking statements. These expectations are based on management's current views and assumptions and involve known and unknown risks and uncertainties. The user of such information should r
Slide 44: Financial Calendar
44 FINANCIAL CALENDAR 9M 2022 INVESTOR RESULTS UPDATE 10 NOVEMBER 13 DECEMBER 2022 2022 Investor update with a focus on new accounting standards
Slide 45: Contacts
45 CONTACTS Assicurazioni Generali Piazza Duca degli Abruzzi 2 34132 Trieste, Italy Fabio Cleva Stefano Burrino Emanuele Marciante Fax: +39 040 671338 Group Head of Investor & Rating Investor Relations Credit & Rating Agency Relations Agency Relations e-mail: ir@generali.com fabio.cleva@generali.com
Slide 46: Generali Group 2022 First Half Results
GENERALI GROUP 2022 FIRST HALF RESULTS
Assicurazioni Generali — H1 2022 Earnings Presentation on 6ix