Allianz is confident it can achieve full-year operating profit in the upper half of its target range of 13.8 billion euros to 15.8 billion euros after the third-quarter reading surpassed expectations, extending the insurer's strong performance to the first nine months, as detailed in a Wednesday release. Lower natural catastrophes year over year powered the German financial services giant's property-casualty segment results, driving group operating profit 13.6% higher to 3.94 billion euros in the three months ended Sept.
30. New business growth at attractive margins in the life/health segment also contributed to operating profit beating the company-compiled analyst consensus by 3%. Consequently, net income attributable to shareholders climbed year over year to 2.47 billion euros from 2.02 billion euros, exceeding consensus by 4%. The insurer and asset manager's total business volume expanded to 42.8 billion euros from 36.5 billion euros thanks to sustained momentum across its insurance segments. In property-casualty insurance, Allianz recorded strong internal growth of 9.5%, which analysts attributed to continued pricing momentum, volume, and service fees.
Notably, retail, small and medium enterprises, and fleet achieved internal growth of 11%, while commercial lines gained 6%. The combined ratio, a metric of the division's profitability measured by readings below 100%, improved to 93.5% from 96.2%. Across life/health insurance, the present value of new business premiums surged 35.4% to 19.5 billion euros due to double-digit growth across most regions.
The company's third-party assets under management stood at 1.84 trillion euros as of Sept. 30, up by 37 billion euros from the end of the second quarter, as negative foreign currency translation effects partly offset net inflows of 19.8 billion euros. "Following 3Q, management are raising their expectations for operating profit to be in the upper half of the EUR13.8bn-15.8bn range - though we believe consensus is already in the upper half," said Deutsche Bank Research.
"A good set of results in our view, but where this was not going to be the key catalyst, given that the group hosts a CMD on 10 December, where it will unveil its updated strategy and financial ambitions." Shares gained over 1% in morning trade..