Generali Group 1Q 2014 Results

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Generali Group 1Q 2014 Results

  1. 1. © Generali May 15, 2014 1Q 2014 Results GENERALI GROUP 1Q 2014 Results Please note that prior year’s figures have been restated throughout the whole presentation to reflect the new perimeter of the Group. Net income, Shareholders’ Equity, Solvency I, Life Value KPIs are not adjusted for disposed entities. The like for like change of written premiums, life net inflows, APE and NBV is on equivalent terms (on equivalent exchange rates and consolidation area).
  2. 2. © Generali May 15, 2014 1Q 2014 Results Agenda 2 - Profit & Loss and Balance Sheet Page 3 - Business review Page 10 - Backup Page 24
  3. 3. © Generali May 15, 2014 1Q 2014 Results Agenda I. Profit & Loss and Balance Sheet 3
  4. 4. © Generali May 15, 2014 1Q 2014 Results  Operating Result: Stable at the high level of last year  Life: Steady despite low yield environment; strong net flows continue  P&C: Increasing thanks to higher technical and investment results  Net Result: Increasing mainly due to improvement in non-operating investment result  Solvency I: Strong contribution from net result and financial market development. Following the end of Q1:  Ineligible loan of € 500 m repaid and replaced during Q2.  Solvency I ratio at end April was ~ 160% 1Q13 1Q14 LFL D Operating result (€ m) Of which: Life Of which: P&C 1,290 781 498 1,296 779 516 +0.5% -0.2% +3.7% Net result (€ m) 603 660 +9.4% Shareholders’ equity(1) 19,778 21,741 +9.9% Solvency I(1) 141% 152% +11%pts. 4 Key 1Q 2014 financials at a glance Profit & Loss (1) Comparative data FY13
  5. 5. © Generali May 15, 2014 1Q 2014 Results 1,290 19 25 1,296 (1) (14) (22) 1Q13 LIFE P&C FINANCIAL SERVICES HOLDING EXP. CONS.AD 1Q14 5 Operating result by segment Profit & Loss (€ m) +0.5% 1Q14 779 516 144 (97) (47) 1Q13 781 498 119 (83) (25) D -0.2% +3.7% +21.0% +17.4% +87.5%
  6. 6. © Generali May 15, 2014 1Q 2014 Results 6 From operating result to net profit Profit & Loss 1Q14 1,296 129 (210) (161) (323) 1 (72) 660 1Q13 1,290 (18) (187) (78) (347) 13 (69) 603 D +0.5% n.m. +11.9% n.m. -6.9% n.m. +3.5% +9.4% 1,296 129 (210) (161) (323) 1 (72) 660 OPERATING RESULT NON OPER. INVESTMENT INCOME NON OPER. HOLDING EXPENSES NET OTHER NON OPER. EXPENSES INCOME TAXES DISC. OPERATIONS MINORITIES NET RESULT (€ m)
  7. 7. © Generali May 15, 2014 1Q 2014 Results 7 Shareholders’ equity Balance Sheet Change in AFS reserve (€ m) + 9.9% Shareholders’ equity rollforward (€ m) 19,778 1,344 660 0 21,741 (0) (41) SHAREHOLDERS' EQUITY FY13 Δ in AFS RESERVE 1Q 2014 NET RESULTS DIVIDEND OTHER SHAREHOLDERS EQUITY 1Q14 2,513 83 1,216 45 3,857 AFS RESERVE FY13 IMPACT EQUITY INVESTMENT IMPACT BOND INVESTMENTS OTHER AFS RESERVE 1Q14
  8. 8. © Generali May 15, 2014 1Q 2014 Results 8 Solvency I Capital +11%pts. Solvency I rollforward (%) 141% 0%pts 4%pts 7%pts 152% SOLVENCY I FY13 REQUIRED MARGIN GROWTH CONSOLIDATED RESULT FINANCIAL MARKETS AND OTHER SOLVENCY I 1Q14 (1) (1) For interim closings, no accrued dividends are deducted from available margin.
  9. 9. © Generali May 15, 2014 1Q 2014 Results 9 Debt refinancing operations completed Financing until 2016 call dates completed; € 1 bn net reduction in debt levels by end 2015 Leverage 12.8 1.3 14.0 (0.5) 1.0 (2.3) 12.3 (0.5) 11.8 FY13 SENIOR BOND ISSUED JAN 2014 1Q14 REPAYMENT OF INELIGIBLE LOAN SUB DEBT ISSUE MAY 2014 2014 MATURITIES EXPECTED FY14 2015 MATURITIES EXPECTED FY15 (€ bn)  Advantage taken of market conditions to pre-finance until 2016 call dates:  € 1.25 bn senior debt issued in January, with € 2.25 bn senior maturing this year (remainder financed from internal resources, in excess of 1/3rd target)  € 1.0 bn subordinated bond issued in May to 1) Replace € 500 m ineligible loan at year end, and 2) Pre- finance 2015 maturities of € 0.5 bn.  Net € 1 bn improvement in debt position expected by 2015, with lower interest expenses ( € 60 m)
  10. 10. © Generali May 15, 2014 1Q 2014 Results Agenda II. Business review 10
  11. 11. © Generali May 15, 2014 1Q 2014 Results (€ m) 1Q13 1Q14 LFL D Gross written premiums 11,860 12,061 +2.4% Net inflows 2,810 2,888 +4.3% Life operating result 781 779 -0.2% Life operating ratio on investments (bps) 24 22 -2 APE 1,213 1,270 +5.4% New Business Value 254 320 +35.2% Margins on APE (%) 20.9% 25.2% +5.2%pts. 11 Life key financial indicators Life Insurance
  12. 12. © Generali May 15, 2014 1Q 2014 Results 781 29 85 779 (116) 1Q13 TECHNICAL MARGIN INVESTMENT RESULT EXPENSES 1Q14 12 Life Operating result by driver Life Insurance 1Q14 1,384 546 (1,151) 1Q13 1,500 517 (1,236) D % -7.7% +5.7% -6.9%  Stable thanks to increasing investment result and decreasing expense ratio  Technical margin lower due to policyholder share of lower expenses, and lower risk result  Overall operating profit margin stable 22 bp of investments (€ m) -0.2%
  13. 13. © Generali May 15, 2014 1Q 2014 Results 13 Life inflows and technical reserves(1) Life Insurance (1) Including liabilities related to investment contracts (€ m) 1Q13 1Q14 Italy 212 1,070 France 70 (224) Germany 1,494 821 CEE 143 130 EMEA 671 949 Lat. Am. 88 58 Asia 111 63 International 21 23 TOTAL 2,810 2,888  Increase in net inflows (+4.3%)  Notable improvements in Italy and EMEA  Decrease in Germany due to planned reduction of single premiums  Overall growth in reserves of 1.5% + 1.5% + 2.7% + 1.2% Unit linked Traditional (€ bn) 266.4 2.9 3.6 269.6 58.9 60.5 325.3 330.1 (1.4) (0.3) FY13 NET INFLOWS LOADINGS, RISK & SURRENDER RESULT POLICYH. SHARE OF INVEST. RESULT EXCHANGE RATES & OTHER 1Q14
  14. 14. © Generali May 15, 2014 1Q 2014 Results 14 Life investment performance Life Insurance Life segment own investments (%) Euro 282.4 bn Euro 294.6 bn (1) Net of depreciation expenses. 43.3% 44.1% 34.6% 34.4% 8.1% 8.9% 4.7% 4.4% 3.5% 3.4% 3.8% 3.0% 1.9% 1.9% FY13 1Q14 Other Cash & cash equivalent Real estate Equity Other fixed income Corporate bonds Government bonds Euro m % Fixed income 1Q13 2,225 0.96 1Q14 2,274 0.91 Equity 1Q13 17 0.14 1Q14 91 0.70 Real Estate(1) 1Q13 151 1.55 1Q14 147 1.48 Total(1) 1Q13 2,474 0.90 1Q14 2,592 0.90 Current returns (not annualized)
  15. 15. © Generali May 15, 2014 1Q 2014 Results  Positive development of APE (+5.4%) with good progressions of both annual and single premiums.  NBM improves (+5.2%pts. on homogeneous basis) thanks to the more favourable economic assumptions and to the further reduction of guarantees in Euro area (from 1.15% at FY13 to 0.97% at 1Q14).  Solid NBV at Euro 320 m (+35.2%). 15 Life new business analysis Life Insurance (€ m) APE NBV MARGIN ON APE 1Q13 1Q14 LFL r 1Q13 1Q14 LFL r 1Q13 1Q14 LFL r Italy 401 571 +42.6% 66 141 +114.6% 16.5% 24.7% +8.3%pts France 248 222 -10.5% 36 34 -6.0% 14.4% 15.2% +0.7%pts Germany 303 204 -34.9% 72 66 -10.7% 23.7% 32.6% +8.8%pts CEE 36 32 -2.6% 16 12 -11.5% 44.7% 38.4% -3.9%pts EMEA 169 198 +13.5% 43 60 +37.7% 25.5% 30.2% +5.3%pts Lat. Am & Asia 56 42 +21.4% 20 6 +103.8% 36.2% 15.1% -4.9%pts Total 1,213 1,270 +5.4% 254 320 +35.2% 20.9% 25.2% +5.2%pts
  16. 16. © Generali May 15, 2014 1Q 2014 Results 16 P&C key financial Indicators P&C Insurance (€ m) 1Q13 1Q14 LFL D Gross written premiums, of which: Primary Motor Primary Non Motor 6,555 2,797 3,575 6,416 2,702 3,569 -0.1% +0.0% +0.8% Combined ratio (%) 93.6% 92.7% -0.8%pts. Of which: Nat Cat impact (%) 0.0% 0.6% +0.6%pts. P&C operating result 498 516 +3.7%
  17. 17. © Generali May 15, 2014 1Q 2014 Results 498 14 4 1 516 1Q13 TECHNICAL MARGIN INVESTMENT RESULT OTHER 1Q14 17 P&C Operating result by driver P&C Insurance 1Q14 336 234 (54) 1Q13 323 230 (55) D % +4.2% +1.7% -1.6%  Improving result, despite higher Nat Cat impact, reflecting better underlying underwriting margins (€ m) +3.7%
  18. 18. © Generali May 15, 2014 1Q 2014 Results (€ m) 1Q13 1Q14 LFL r Italy 1,524 1,464 -4.0% France 922 869 -5.8% Germany 1,443 1,460 +1.2% CEE 534 515 +0.6% EMEA 1,559 1,553 -0.3% Lat Am 271 274 +40.4% Asia 23 24 +6.7% International 277 257 -7.2% Total 6,555 6,416 -0.1% 18 P&C gross written premiums trends P&C Insurance Overall stable premium development:  Decline in Italy primarily driven by Motor. Also Non-Motor decreased due to Commercial and Accident/Health that more than offset improvement in Personal lines  Decline in France driven by both Motor and Non- Motor due to a competitive market environment and strict underwriting guidelines  Improvement in Germany thanks to Non-Motor (driven by Personal and Commercial) that more than offset a slight decrease in Motor  Significant increase in Latin America (on like for like basis), driven by Brazil and Argentina (reflecting inflation)
  19. 19. © Generali May 15, 2014 1Q 2014 Results 66.1 0.6 65.7 (0.3) (0.8) 1Q13 Current year NATCAT Prior years 1Q14 66.1 65.7 27.4 27.0 (0.4)(0.4) 93.6 92.7 1Q13 Δ Expense ratio Δ Loss ratio 1Q14 21.6 21.3 5.9 5.7(0.2) 27.4 27.0 1Q13 Δ Admin Δ Acq. 1Q14 (0.2) 19 Combined ratio analysis P&C Insurance Combined ratio (%) Loss ratio Expense ratio Expense ratio (%) Δ%pts - 0.4%pts. 1Q14 69.2 0.6 -4.0 65.7 1Q13 69.4 0.0 -3.3 66.1 Loss ratio (%) - 0.4%pts. - 0.8%pts. Acquisition costs Administr. costs
  20. 20. © Generali May 15, 2014 1Q 2014 Results 20 Combined ratio by country P&C Insurance  Combined Ratio still improving in Italy, thanks to current year loss ratio, despite Nat Cat impact (+0.9%pts.)  Nat Cat strongly impact Combined Ratio in France (+2.7%pts.)  CEE further improving COUNTRY 1Q13 1Q14 ∆ Italy 92.0% 90.6% -1.5%pts. France 97.2% 103.1% +6.0%pts. Germany 93.8% 94.0% +0.2%pts. CEE 84.4% 81.8% -2.6%pts. EMEA 95.3% 94.9% -0.4%pts. Lat Am 99.6% 102.0% +2.5%pts. Asia 233.1% 110.0% n.m. International 86.5% 76.2% -10.3%pts. Total 93.6% 92.7% -0.8%pts.
  21. 21. © Generali May 15, 2014 1Q 2014 Results 21 P&C investment performance P&C Insurance P&C segment own investments (%) Euro 37.7 bn Euro 40.3 bn 29.1% 24.9% 30.2% 30.4% 6.5% 10.6% 9.9% 8.8% 13.1% 12.3% 10.0% 12.1% 1.1% 0.9% FY13 1Q14 Other Cash & cash equivalent Real estate Equity Other fixed income Corporate bonds Government bonds (1) Net of depreciation expenses. Euro m % Fixed income 1Q13 212 0.83 1Q14 219 0.85 Equity 1Q13 12 0.46 1Q14 12 0.33 Real Estate(1) 1Q13 75 1.45 1Q14 70 1.41 Total(1) 1Q13 319 0.87 1Q14 317 0.81 Current returns (not annualized)
  22. 22. © Generali May 15, 2014 1Q 2014 Results 22 Financial segment key financial indicators Financial Segment 1Q13 1Q14 LFL D Operating result (€ m) 119 144 +21.0% Net fees and commissions (€ m) 218 227 +4.2% Cost / income ratio (%) 66.6% 61.9% -4.7%pts Third party AUM(1) (€ bn) 104.3 104.3 -0.1% (1) Comparative data FY13
  23. 23. © Generali May 15, 2014 1Q 2014 Results 23Final remarks  Solvency significantly improved: optimistic to achieve our balance sheet restructuring plans early  Solid operating result despite low yield environment  Net profit up, as non-operating result improves Final remarks
  24. 24. © Generali May 15, 2014 1Q 2014 Results Agenda 24 II. Backup - Investments Page 25 - Financial debt Page 30
  25. 25. © Generali May 15, 2014 1Q 2014 Results Agenda 25 II. Backup - Investments Page 25 - Financial debt Page 30
  26. 26. © Generali May 15, 2014 1Q 2014 Results 26 Assets under management Investments 68.0% 11.5% 20.4% Own investments Unit Linked Third party AUM 5% 83% 4% 5% 3% Equity Fixed income Real estate Cash & Cash Equivalent Other By Asset Class By Region Total portfolio € 525 bn Breakdown by region and asset class 30% 22% 28% 3% 10% 9% Italy France Germany CEE EMEA RoW and other operations
  27. 27. © Generali May 15, 2014 1Q 2014 Results Total Portfolio € 296 bn 69% 11% 11% 6% 1% 2% Covered € 33 bn 5% 8% 39%38% 8% 2% Corporate € 83 bn AAA AA A BBB Not Investment Grade Not Rated 13% 34% 3% 48% 2% 0% Government € 146 bn (1) 27Investments Fixed Income Portfolio (1) Italian government bond exposure is 85% of BBB Bond duration FY13 1Q14 Life 7.2 7.5 P&C 4.0 4.4 49.4% 12.1% 15.9% 11.0% 11.5% Other fixed Income Covered Corporate non fin. Corporate fin. Government
  28. 28. © Generali May 15, 2014 1Q 2014 Results 61% 21% 17% Equity Equity Funds Alternatives 28Investments Equity & Equity-like Life, P&C and Financial Total portfolio (€ 17.2 bn) Equity (€ 10.6 bn)Alternative investments (€ 3.0 bn) Life, P&C and Financial Life, P&C and Financial Listed and Unlisted 65% 14% 21% Life P&C Financial 80% 20% 0% Life P&C Financial 75% 23% 2% Life P&C Financial 84% 16% Quoted Unquoted
  29. 29. © Generali May 15, 2014 1Q 2014 Results 84% 16% Breakdown by utilization (2) Investment properties Own use 64% 17% 11% 3% 5% Breakdown by use (2) Office Residential Retail Logistic Other/Mixed 29Investments 37% 25% 16% 1% 20% 1% Breakdown by country (2) Italy France Germany CEE RoE RoW Real Estate(1) (1) Data, at fair value, includes indirect investments, investment properties, own use assets and property inventory (2) Detail referred to direct investments in real estate only Total portfolio (€ 24.8 bn (1))
  30. 30. © Generali May 15, 2014 1Q 2014 Results Agenda 30 II. Backup - Investments Page 25 - Financial debt Page 30
  31. 31. © Generali May 15, 2014 1Q 2014 Results 31 Focus on financial debt Financial debt Total financial debt (€ m)Average cost & maturity of financial debt (%) 4,468 5,708 7,612 7,627 678 652 FY13 1Q14 Senior Sub/Hybrid Other FY13 1Q14 Average cost (%) 5.93% 5.66% Subordinated/Hybrid 6.54% 6.54% Senior 4.81% 4.39% Average maturity (years) 5.27 5.10 € 12,758 m € 13,988 m(1) (1) The amount of financial debt as of March, 31, includes the senior bond issued in January 2014 for a nominal amount of € 1.25 bn to refinance part of the 2014 maturities
  32. 32. © Generali May 15, 2014 1Q 2014 Results 2014 2015 2016 2017 2018 2019 2020 2022 2024 2026 Senior Hybrid Subordinated 32 Financial debt breakdown(1) by expiry date/call date Financial debt 2,250 500 2,200 1,265 750 770 2,600 1,750 1,423 (1) This breakdown takes into account the new senior and subordinated issuances of January and April 2014 1,250 (€ m)
  33. 33. © Generali May 15, 2014 1Q 2014 Results 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 recognise that actual results, performance or events may differ materially from such expectations because they relate to future events and circumstances which are beyond our control including, among other things, general economic and sector conditions. Neither Assicurazioni Generali S.p.A. nor any of its affiliates, directors, officers employees or agents owe any duty of care towards any user of the information provided herein nor any obligation to update any forward-looking information contained in this document. The manager charged with preparing the company’s financial reports, Alberto Minali, declares, pursuant to paragraph 2 of article 154-bis of the Consolidated Law on Financial Intermediation, that the accounting information contained in this presentation corresponds to document results, books and accounts records.
  34. 34. © Generali May 15, 2014 1Q 2014 Results 34 Next events 31.07.2014 1H 2014 results reporting 06.11.2014 9M 2014 results reporting 19.11.2014 2014 Investor Day
  35. 35. © Generali May 15, 2014 1Q 2014 Results Team Marta PORCZYNSKA Team assistant & event coordination Marta.Porczynska@Generali.com +39 040 671402 Martina VONO Team assistant & event coordination Martina.Vono@Generali.com +39 040 671548 Assicurazioni Generali P.za Duca degli Abruzzi 2 34132 Trieste, Italy Fax: +39 040 671338 e-mail: ir@generali.com www.generali.com Spencer HORGAN Head of Investor Relations Spencer.Horgan@Generali.com +44 20 7265 6480 Stefano BURRINO Stefano.Burrino@Generali.com +39 040 671202 Emanuele MARCIANTE Emanuele.Marciante@Generali.com +39 040 671347 Veronica CHERINI Veronica.Cherini@Generali.com +39 040 671488 Rodolfo SVARA Rodolfo.Svara@Generali.com +39 040 671823 35
  36. 36. © Generali May 15, 2014 1Q 2014 Results Thank you 36
  37. 37. © Generali May 15, 2014 1Q 2014 Results GENERALI GROUP 1Q 2014 Results

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