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Allianz (ETR:) Group (ALV.DE) has delivered a robust financial performance in the first quarter of 2024, with significant growth in business volume and profits. The company’s total business volume grew by 7.5% to €48 billion, while operating profit reached €4 billion.

Shareholder core net income saw a 16% increase compared to the previous year. These figures are indicative of Allianz’s successful start to the year, with key metrics surpassing full-year assumptions and a strong solvency ratio of 203%.

Key Takeaways

  • Total business volume increased by 7.5% to €48 billion.
  • Operating profit reached €4 billion, with shareholder core net income up by 16%.
  • Property & Casualty (P&C) segment saw a 7.5% internal growth and a combined ratio of 91.9%.
  • Life and Health segment achieved its highest quarterly new business value at €1.3 billion.
  • Asset Management reported €34 billion in third-party net flows and an operating profit of €800 million.
  • Solvency ratio remained strong at 203%, with capital strength stable.
  • Operating profit to net income conversion was straightforward, with lower impairments and a 25% tax rate.

Company Outlook

  • Allianz confirmed its outlook for the year, expressing confidence in its prospects.
  • The company expects similar seasonality and discounting patterns as the previous year.
  • Growth opportunities in the German P&C market, particularly in motor and non-motor lines.

Bearish Highlights

  • Higher than anticipated discounting effects in Q1 due to higher volume and inflation in certain countries.
  • The real estate valuation is expected to plateau after increases in 2024.

Bullish Highlights

  • Strong growth in the P&C segment and improvement in the combined ratio.
  • Life and Health segment showed strong new business momentum with a record level of value.
  • Asset Management achieved a 4% increase in third-party assets under management and high performance fees.
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Misses

  • Negative internal growth rate of -1.9% in Q1, though catch-up is expected in Q2.
  • Some financial lines business, including cyber and aviation, not priced as desired.

Q&A Highlights

  • The company is managing inflationary trends effectively.
  • Pricing increases implemented in Q2-Q3 are expected to boost earnings in the second half of the year.
  • Reserve strength for AGCS and Allianz Group is satisfactory, with no need for strengthening.
  • The impact of the Brazil floods event is still being assessed but is expected to be a…

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