For the first time in many years, Generali opens its annual meeting on Thursday 19 April in Trieste as continental leader of the Stock Exchange. It has not happened for some time that the insurance company led by Philippe Donnet presented itself at the Trieste meeting with a better performance on the stock market than that of its European competitors. Since the beginning of 2018, the Generali stock has been clearly in command compared to the big continental policies with an increase – as at 13 April – of 6,4% against the decreases of 1,09% of Allianz and 8,23% of Axa . Behind the Lion are also Muenchen Ruesckvers (+5,8%), Prudential (-3,1%), Swiss Re (+4,4%) and Zurich (+3,6%).
That of Generali is not an ephemeral stock market record because since the Investor Day of 23 November 2016 Generali has gained 43% against 40% of the Ftse Mib and 16% of Dow Jones Insurance but above all against 25% of Allianz , 14% of Zurich and 1,4% of Axa.
The market has evidently rewarded the financial results and the sober and essential management style of Philippe Donnet, the Corsican who loves Italy and above all Venice where he lives when his work commitments allow it.
The operating result of the financial statements, which will be submitted to the assembly on Thursday, reached a new record at 4,89 billion euros (+2,3%), the net profit exceeded 2,1 billion (+1,4, 6%), the dividend is up by 0,85% (92,8 euro per share), the combined ratio is among the best among peers (208%) and capital solidity has further strengthened reaching a Regulatory Solvency Ratio of 230% and an Economic Solvency Ratio of XNUMX%.
In recent weeks, two important shareholders such as Benetton and Caltagirone have invested new resources in the company, rising respectively to 3 and 4% of the capital.
If Generali were a normal company, the performances achieved on the field would let one imagine a long driving season for Philippe Donnet and a discounted renewal of his three-year mandate as CEO, which expires next spring, but Generali is a public company and above all it must always come to terms with the bizarreness and selfishness of its shareholders, starting with the main one (Mediobanca) which has announced several times that it wants to reduce its stake in Leone but has never done so and has surprisingly changed horse several times running (first replacing Giovanni Perissinotto and then not confirming Mario Greco).
Despite the avarice of the main shareholders, who for a long time have not granted Generali a capital increase to support development as all its competitors have done, Donnet has made a virtue of necessity and has been able to reassure the company, consolidating a new generation team very cohesive, hitting targets and embarking on new growth paths, starting with the strengthening of asset management.
Although last year's takeover attributed to Intesa Sanpaolo ended in nothing, the move by the leading Italian bank nevertheless reminded everyone and Generali in the first place that no one can live on their laurels and that an attractive and contestable company like the Lion of Trieste is always exposed to the winds of the markets. Generating profits and reinvesting them and evaluating the opportunities for small or medium-sized acquisitions in the various market segments is certainly a good line of defence. Stop it? In reality, the unknown factor facing the next plan and consequently Donnet's future is simple and difficult at the time: continue growth in small steps or attempt the big leap by betting on a qualitative leap in the development of the company?
It is clear that only the second option can truly secure and project towards new goals one of the rare Italian champions with a strongly international outlook like Generali, but daily work is not enough to accept the bet of development and the great leap forward of an excellent management but the foresight of the shareholders would be needed, even at the cost of diluting oneself. Is it a realistic horizon? We will understand this at the Investor Day in Milan next November and from the new strategic plan that will be launched then. Doubt is legitimate, hope is possible.
