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Allianz SE, Europe's largest insurer, has reported a better-than-expected profit for the second quarter of 2024, showcasing its resilience amid increased claims from natural disasters. The company also announced an expansion of its share buyback program for the year.
For the quarter ending June 30, Allianz achieved a net profit of €2.51 billion ($2.74 billion), surpassing the €2.34 billion reported for the same period last year. This result exceeded the analyst consensus estimate of €2.32 billion. The company’s total revenue rose 7.6% to €42.6 billion, reflecting robust business performance across its segments.
Operating profit for Allianz increased by 3.8% year-on-year to €3.93 billion, beating the forecasted figure of €3.70 billion. However, the property and casualty segment, Allianz’s largest division, faced significant weather-related losses, including impacts from floods in southern Germany and the New Caledonia riots. Despite these challenges, Allianz managed to report a property and casualty combined ratio of 93.5%, indicating an underwriting profit as the ratio remains below 100%.
The life and health insurance units performed stronger than anticipated, contributing positively to the company’s overall performance. However, the asset management segment fell slightly short of expectations. Allianz's asset-management business, which includes Pimco and Allianz Global Investors, reported third-party assets under management of €1.803 trillion at the end of the quarter. This represents the highest level since early 2022, driven by €14.1 billion in net inflows and favorable currency effects.
The company’s solvency ratio, a key measure of capital strength, improved to 206%, surpassing both the previous quarter’s ratio and the consensus estimate of 203%.
In a move to return value to shareholders, Allianz has expanded its share buyback program for 2024. The insurer will now repurchase up to €1.5 billion of its shares, building on the €1 billion buyback completed in July. A new buyback program of up to €500 million will commence in mid-August and is expected to conclude by the end of December.
Allianz has maintained its full-year guidance, expecting an operating profit of approximately €14.8 billion, with a variance of €1 billion. Analysts, including William Hawkins from Keefe, Bruyette & Woods, suggest that the company’s strong first-half results could position it towards the higher end of this forecast range.
