In the first quarter of this year the general insurance, have registered a Net income normalized up by 49,7% to 1,23 billion compared to the 821 million euro recorded in the first three months of the previous year. This was stated in a note from the group at the end of the board meeting held under the chairmanship of Andrea Sironi who confirmed the strategic objectives and financial for 2023 and dividend policy for the three-year period 2022-2024, while there have been no devaluations linked to Russia. In Piazza Affari, the stock was initially up 0,53% to 17,97 euros.
Targets confirmed with 5,2/5,6 billion in dividends
In particular, Generali confirmed the objective of compound annual growth 2021-2024 of earnings per share between 6% and 8%. Furthermore, the management has confirmed the indication to generate net cash flows available in the period 2022-2024 in excess of €8,5 billion and distribute to shareholders dividends accumulated in the three-year period 2022-2024 for an amount between 5,2 and 5,6 billion. “Thanks to the quarterly results showing strong and profitable growth, Generali confirms itself on track to successfully achieve the objectives of the 'Lifetime Partner 24: Driving Growth' strategy” said the CFO of Generali, Christian Borean.
The net result improves to 1,2 billion
The Lion of Trieste explains in a note that the good result was achieved thanks to the "benefit of diversified sources of profit", the non-recurring profit relating to the sale of a London property complex (for 193 million after tax), the impact of writedowns of 96 million on Russian fixed income securities recorded in the first quarter of last year. The Net income improves to 1,2 billion after 481 million in the same period last year.
The operating result grew by 22,1% driven by the Non-Life business
Also on the rise Operating income, which stood at 1,82 billion euro, compared to the 1,49 billion obtained in the first quarter of 2022, (+22,1%) thanks above all to the contribution of Damage branch up 74,6% to 847 million. The Life branch saw a Life operating result of 924 million (+1,0%) and the New Business Margin amounted to 5,72% (+0,32 pp). “The performance of the Non-Life segment reflects our commitment to maintaining technical excellence, while in the Life segment, despite the complex context, the rebalancing of our production mix towards the most profitable business lines continues” Borean continued.
I gross premiums overall rose by 1,3% to €22,16bn, with Non-Life business up by 10,1%, while net Life premiums recorded a drop of €190m. The positive net inflows of the unit-linked and pure risk and health lines partly offset the net outflows from the savings line, in line with the Group's portfolio repositioning strategy, and also reflecting, in particular, the dynamics observed in the banking channel in Italy and France.
For the 2023 Generali confirms and continues with the strategy of "rebalancing the Life portfolio to further increase profitability, with a more efficient allocation of capital" says the note. "In P&C, Generali's goal is to maximize profitable growth and, at the same time, to strengthen itself in markets with high growth potential, expanding its presence and offer"
Borean: Externally solid capital position confirmed
Il Combined ratio it stood at 90,7%. At the end of March 2023, Generali's shareholders' equity amounted to 28 billion euros, an increase of 3,6% compared to the figure at the beginning of the year of 27,06 billion.
At the end of March the Solvency Ratio was equal to 227%, an increase compared to 221% at the beginning of the year. Generali explained that the improvement mainly reflects the strong contribution of capital generation normalized which, together with the positive impact of market variations (in particular the narrowing of spreads on government bonds, the recovery of the equity markets and the reduced volatility), more than offset the impacts deriving from the accrual of the dividend for the period and the buyback linked to the company's long-term incentive plan.
“The Group also confirms its capital position extremely solid, thanks to the strong organic generation of capital. For the first time we present our results according to the new accounting standards, which allow us to significantly improve the visibility and predictability of the sources of profit, as well as provide a better representation of the intrinsic value of our Life business” adds Borean.
The Asset & Wealth Management segment is down
The Trieste-based company says that the activities identified in the Group's strategic plan will continue to be implemented in the Asset & Wealth Management segment, with the aim of expanding the product catalog and strengthening distribution skills.
Il Operating income of the Asset & Wealth Management segment stood at 233 million down 10,0%. In detail, the operating result of Asset Management activities amounted to 123 million (-28,9%), which reflects both the reduction in recurring commissions to 206 million (-5,2%), due to market on Assets Under Management in 2022, and the absence of non-recurring performance fees of 38 million in the first quarter of 2022, says Generali. Total Assets Under Management stood at €631,3 billion, an increase of 2,6% compared to 31 December 2022, reflecting the positive market effect on the main asset classes. Transaction fees arising from investments in real estate market and infrastructure came in at 16 million in the first quarter. Operating costs, on the other hand, increased by 120 million (+14,2%), also reflecting "the launch of initiatives aimed at optimizing the operating machine".
Banca Generali: operating result at +27,4%
Group operating result General Bank it grew by 27,4% to 110 million "thanks to the diversification of the business, which made it possible to seize the opportunities that emerged on the markets during the first quarter", says the note. "Performance was also supported by improved net interest margin and disciplined cost management." There net collection total of Banca Generali at the end of March stood at 1,5 billion, confirming a solid commercial trend in terms of volumes.
