Allianz achieves record operating profit and shareholders' core net income

Munich - Allianz SE has reported that its total business volume for the 12 months ended 31 December 2023 rose by 5.5% to €161.7bn, driven by the Property-Casualty business segment due to positive price and volume effects, supported by the Life/Health business segment mainly as a result of strong growth in the United States. This was partially offset by lower revenues in the Asset Management business segment.

The Group said internal growth, which adjusts for foreign currency translation and consolidation effects, was at 8.0%, primarily driven by the Property-Casualty and Life/Health business segments.

Allianz explained that in Q4 2023, its total business volume rose by 7.8% to €39.6bn, driven by all business segments, with the increase in the Life/Health business segment primarily driven by the United States and Italy. Growth in the Property-Casualty business segment was mainly price driven, while our Asset Management business segment benefited from higher performance fees.

Internal growth was 10.9%, driven by all business segments.

"Allianz extended our track record of delivering a record operating profit and core net income, consolidating our leading position as one of the world's most resilient global insurers and active asset managers. 

Our results demonstrate the trust that our customers place in Allianz, and in the resilience and potential of our business model and our people. Our Property- Casualty business saw strong growth while we supported our customers affected by elevated levels of natural catastrophes. Our Life/Health segment delivered profitable growth as we developed attractive solutions to protect our customers from the effects of inflation on their savings, and in our Asset Management business we achieved robust net inflows in a volatile capital market environment.

The discipline of our strategy, execution, and capital management bolsters our operating profit outlook for 2024, our new dividend policy, and our renewed share buy-back program. In the coming year, we will continue to focus on unlocking the benefits of our scale to further increase our productivity, and on converting our excellent customer experience into profitable customer growth." - Oliver Bäte, Chief Executive Officer of Allianz SE

Earnings

The Group said for the 12 months of 2023, its operating profit increased 6.7% to €14.7 (12M 2022: 13.8) bn mainly due to our Life/Health business segments, while the result of its Property-Casualty business segment increased slightly amid higher claims from natural catastrophes. Operating profit from its Asset Management business segment softened slightly as a result of foreign currency translation effects.

Shareholders' core net income, it added, grew to €9.1 (7.0) bn driven by an improved operating profit in the current period, as well as by an improved non-operating result due to the one-time Allianz GI US Structured Alpha provision captured in the prior-year period. Net income attributable to shareholders advanced to €8.5 (6.4) bn, up by 33.0%.

Core earnings per share (core EPS) increased to €22.61 (16.96). 

Core return on equity (RoE) grew to 16.0% (12.7%).

Allianz said the Board of Management has decided to increase the payout ratio to 60% from 50% and proposes a dividend per share of €13.80 for 2023, an increase of 21.1% from 2022.

On February 22, 2024, Allianz announced a new share buy-back program of up to €1bn.  

Operating profit for Q4 2023 was strong at €3.8 (4Q 2022: 3.2) bn, up by 17.0%, driven by the Life/Health business segment, primarily due to a higher result in protection and health and transitional impacts linked to the adoption of IFRS 17 in the United States in the prior year. The Asset Management business segment benefited from higher revenues as a result of higher performance fees.

Shareholders' core net income increased to €2.4 (1.6) bn due to a higher operating profit and non-operating result. Net income attributable to shareholders doubled to €2.2 (1.1) bn.

Solvency II capitalization ratio

The Solvency II capitalization ratio was 206 percent at the end of 2023 compared with 201 percent at the end of 2022. When including the application of transitional measures for technical provisions, the Solvency II capitalization ratio was 229 percent at the end of 2023 compared with 230 percent at the end of 2022.

Segmental highlights

"We've achieved another year of record results and all operating segments finished the year above or close to their operating profit target mid-points. 

• In our Property-Casualty business we recorded strong revenue growth, driven by healthy pricing and higher volumes. Growth was spread across our entities, reflecting the strength of our diversified global franchise. Our focus on technical excellence helped us to successfully mitigate the impact of inflation on our operating profit, which faced an above-average level of natural catastrophes. Our investment result benefited from higher interest rates.
• The operating profit in our Life/Health segment exceeded our outlook mid-point and was also well above the prior year. Our value creation is supported by a healthy new business margin that we maintained by providing attractive solutions to our clients, allowing us to record a solid new business development.
• In Asset Management, our operating profit was above our outlook mid-point, and we achieved positive net inflows in a volatile market environment. A competitive cost-income-ratio and an increase in our third-party assets under management bode well for future profitability.  

We will continue to focus on generating attractive and sustainable returns for all of our stakeholders while not compromising on our resilience. We enter 2024 with confidence and target a full-year operating profit of 14.8 billion euros, plus or minus 1 billion euros." - Claire-Marie Coste-Lepoutre, Chief Financial Officer of Allianz SE

Total assets under management 

Total assets under management were €2.224trillion at the end of the fourth quarter, up €62bn from the end of the third quarter, and in line with the results for the third-party assets under management, including positive market effects of €124.6bn, negative currency translation effects of €50.6bn and net outflows of €12.3bn.