Earnings Results (AXA PR 20250227)

GIE_AXA_Secret GIE_AXA_InternalParis, February 27, 2025 (7:00am CET) Full Year 2024 EarningsAXA has delivered a very strong performance in 2024, successfully executing in the first year of its strategic plan 'Unlock the Future'", said Thomas Buberl, Chief Executive Officer of AXA.We have a clear strategy fully focused on insurance and built around leading businesses, supported by a robust balance sheet.This is producing attractive and consistent results, with record topline and underlying earnings per share, both growing by +8% this year, and cash generation of more than Euro 7 billion.Our Group is now growing at a stronger pace, with robust revenue growth across all lines of business and geographies.We have remained disciplined on pricing while accelerating on volume growth.This reflects continued demand notably in both P&C Commercial lines and Life & Health, high customer satisfaction driving improved retention, and contribution from growth initiatives.Group underlying earnings reached Euro 8.1 billion, a function of both higher topline growth and excellent margins.We have delivered on our short-term profitability improvement in P&C Retail and UK Health and maintained strong margins in P&C Commercial lines, with limited impact from Nat Cats.Trends in Life are improving, and we continue to invest in technology to support long-term growth.In the context of these results, and in line with our capital management policy to deliver an attractive 75% total payout ratio, the Board of Directors is proposing a dividend of Euro 2.15 per share, up 9% versus last year, corresponding to a 60% payout ratio, and has approved an annual share buy-back of Euro 1.2 billion.We anticipate returning an additional Euro 3.8 billion to shareholders through a share buy-back to be launched following the expected closing of the sale of AXA Investment Managers to BNP Paribas.Capitalizing on our model, we continue to reinvest in our high-retubusiness, compounding value for our shareholders.The Group is in strong shape, and we are confident in executing our plan.I would like to thank all our colleagues, agents, and partners for their tremendous efforts to deliver this excellent performance, as well as our customers for their loyalty and trust.• Gross written premiums & other revenues at Euro 110 billion, up +8% vs. FY23• Underlying earnings per share at Euro 3.59, up +8% vs. FY23• Solvency II ratio at 216%, down 11 pts vs. FY23• Dividend of Euro 2.15 per share, up +9% vs. FY23, and launch of an annual share buy-back program of up to Euro 1.2 billion~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretFY24 key highlightsActivity indicators Total gross written premiums and other revenues were up 8%, driven by (i) Property & Casualty (+7%), with growth in Commercial lines (+6%) from higher volumes, notably at AXA XL Insurance, as well as favorable price effects across all geographies, in Personal lines (+7%), driven by favorable price effects, partly offset by lower volumes notably in the UK & Ireland and Germany, reflecting measures to restore profitability, and at AXA XL Reinsurance (+10%), from favorable price effects and higher volumes, (ii) Life & Health (+8%), with Life premiums up 9%, driven by Unit-Linked products (+18%) following the launch of a new product in Italy and good sales dynamics in France, G/A Savings (+12%), notably from elevated sales of a capital-light product in Japan, and Protection (+3%), and with Health premiums up 8%, thanks to strong growth across most geographies, both in Individual and Group businesses, and (iii) Asset Management (+8%), mainly driven by higher management fees.Earnings Underlying earnings increased by 7% to Euro 8.1 billion, driven by (i) Property & Casualty (+10%), due to strong underwriting results across the board, (ii) Life & Health (+4%), driven by higher technical results in Protection and Health mainly reflecting margin recovery in UK Health, and (iii) Asset Management (+11%), from higher revenues.This was partly offset by (iv) Holdings (Euro -156m), reflecting investments in technology and growth initiatives.Underlying earnings per share increased by 8% to Euro 3.59, mainly driven by (i) the increase in underlying earnings (+7%) and (ii) the favorable impact of share buy-backs (+2%), partly offset by (iii) unfavorable foreign exchange impacts and higher financial charges related to undated and deeply subordinated debt (-1%).Net income increased by 11% to Euro 7.9 billion, mainly reflecting the increase in underlying earnings and favorable change in fair value of assets.FY23  FY24  Change on a reported basis  Change at constant ForexGross written premiums & other revenues  102,733  110,316  +7%  +8%o/w Property & Casualty  53,027  56,514  +7%  +7%o/w Life & Health  48,058  51,983  +8%  +8%o/w Asset Management  1,555  1,701  +9%  +8%Underlying earnings  7,604  8,078  +6%  +7%Net income  7,189  7,886  +10%  +11%FY23  FY24  Change on a reported basisSolvency II ratio (%)  227%  216%  -11 ptsKey figures (in Euro million, unless otherwise noted)KEY HIGHLIGHTS~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretBalance sheet Shareholders' equity was Euro 49.9 billion as of December 31, 2024, up by Euro 0.4 billion versus December 31, 2023, driven by a positive net income contribution, partly offset by the FY23 dividend paid to shareholders and the impact of share buy- backs executed in 2024, net reduction in deeply subordinated debt, and the unfavorable change in OCI.CSM was Euro 33.9 billion as of December 31, 2024, down Euro 0.3 billion versus December 31, 2023.Adjusting for the scope effect from in-force transactions, CSM was up Euro 0.3 billion versus December 31, 2023, as new business contribution (Euro +2.2 billion), together with underlying retuon in-force (Euro +1.4 billion), more than offset CSM release (Euro -2.8 billion), resulting in +2% normalized growth in CSM.The impact of unfavorable market conditions (Euro -1.0 billion), largely due to the widening of government spreads, was partly offset by positive operating variance (Euro +0.4 billion), reflecting better profitability of the portfolio.Solvency II ratio was 216% as of December 31, 2024, down 11 points versus December 31, 2023, with + 6 points from a strong operating retu(+28 points) net of a provision for dividend and annual share buy-back for 2024 (-22 points), which was more than offset by the unfavorable impact from financial markets (-13 points), mainly from the widening of government spreads, and the negative impact of net subordinated debt redemption (-3 points).Underlying retuon equity was at 15.2% as of December 31, 2024, up 0.3 point versus December 31, 2023, notably from higher underlying earnings.Debt gearing was at 20.6% as of December 31, 2024, up 0.3 point versus December 31, 2023, reflecting a stable debt stock and unfavorable impact from the change in OCI.Cash at Holding amounted to Euro 4.0 billion as of December 31, 2024, stable versus December 31, 2023, reflecting organic cash remittance from subsidiaries of Euro 7.1 billion, up by Euro 0.8 billion versus FY23.KEY HIGHLIGHTS~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretCapital management and outlook Capital management A dividend of Euro 2.15 per share (up 9% versus FY23) will be proposed at the Shareholders' Annual General Meeting on         April 24, 2025.The dividend is expected to be paid on May 7, 2025, with an ex-dividend date on May 5, 2025.AXA's Board of Directors approved on February 26, 2025, the launch of an annual share buy-back program for up to Euro 1.2 billion, to be executed in accordance with the terms of the applicable Shareholders' Annual General Meeting authorization.AXA intends to cancel all shares repurchased pursuant to this share buy-back program.The share buy-back program is expected to commence as soon as reasonably practicable, subject to market conditions, and it is expected to be completed by year-end.Further details will be communicated regarding the execution of the share buy- back program.In addition to the up to Euro 1.2 billion annual share buy-back program, AXA anticipates launching a share buy-back of Euro 3.8 billion following the expected closing of the sale of AXA Investment Managers to BNP Paribas.Outlook AXA is resolutely focused on executing its "Unlock the Future" plan over 2024-2026, which is based on delivering profitable organic growth and scaling technical excellence across each of its businesses, while driving operational excellence across the organization.In P&C Personal lines, the Group aims at further accelerating volume growth while higher pricing is expected to continue to eathrough.In P&C Commercial lines, pricing remains favorable in SME and mid-market, while continuing to moderate in Large Commercial lines with conditions varying by lines.The Group will remain disciplined to ensure good cycle management and expects to maintain margins including through efficiency gains.The Group's natural catastrophe load of ca. 4.5 points of combined ratio for 2025 is maintained.This includes the Group's current estimated losses from California wildfires of Euro 0.1 billion, before tax and net of reinsurance.In Life & Health, in the near term, earnings growth should come from the short- term business reflecting attractive growth opportunities, notably from Employee Benefits, as well as continued margin expansion.New business volumes combined with improved persistency are expected to drive higher normalized CSM growth over time.Results in Holdings in 2024 reflect investments in technology and growth initiatives and are expected to remain at a similar level in 2025.Considering the strong overall operating performance delivered in 2024, and assuming current operating conditions persist, Management believes AXA is on track to deliver the main financial targets of AXA's "Unlock the Future" plan: (i) underlying earnings per share growth of 6-8% CAGR target range between 2023 and 2026E, (ii) underlying retuon equity between 14% and 16% between 2024 and 2026E, and (iii) cumulative organic cash upstream in excess of Euro 21 billion for 2024-2026.The Group is committed to its capital management policy, targeting a total payout ratio of 75%, comprising a 60% dividend payout ratio and an additional 15% from annual share buy-backs.~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretProperty & CasualtyGross written premiums & other revenues were up 7% to Euro 56.5 billion.• Commercial lines premiums increased by 6% to Euro 34.9 billion, driven by (i) AXA XL Insurance (+5%), reflecting higher volumes, notably from better customer retention, and pricing in Property and in Casualty, partly offset by soft market conditions in Financial lines, (ii) Asia, Africa & EME-LATAM (+24%) mostly driven by higher average premiums in Türkiye, as well as higher volumes and favorable price effects notably in Mexico, and (iii) Europe (+4%) and France (+4%), mostly from favorable price effects.• Personal lines premiums increased by 7% to Euro 19.1 billion, driven by favorable price effects in both Motor and Non-Motor.• This was partly offset by lower volumes in the UK & Ireland and Germany, primarily in 1H24.• In the rest of the Group, volume growth was positive, reflecting favorable market positioning.• AXA XL Reinsurance premiums increased by 10% to Euro 2.5 billion, driven by favorable price effects, notably in Property and in Casualty, and higher volumes in Property and in Specialty.• The all-year combined ratio was 91.0%, down 2.1 points:• Current year combined ratio improved by -1.6 points mainly driven by (i) a more favorable undiscounted current year loss ratio excluding Nat Cat (-1.0 point), from margin recovery in Personal lines reflecting underwriting measures taken in the UK & Ireland and Germany in response to higher frequency in Motor in 2023, and continued improvement in Commercial lines, and (ii) lower Nat Cat charges (-1.0 point to 3.8%).• This was partly offset by  (iii) a higher expense ratio (+0.3 point) due to an increase in commissions driven by changes in business mix, and (iv) a decrease in the current year discount benefit (+0.2 point), driven by lower average interest rates across most geographies.• Prior year reserve development, at -1.6%, was -0.6 point more favorable than last year, in the context of a significant increase in the unwind of discount benefit.P&C underlying earnings were up 10% to Euro 5.5 billion, driven by (i) higher underwriting results (Euro +1.4 billion), partly offset by (ii) an increase in taxes (Euro -0.7 billion), notably due to the introduction of the OECD tax and non- repeat of favorable tax one-offs, in particular in AXA XL and Europe, (iii) lower financial result (Euro -0.1 billion), reflecting a significant increase in unwind (Euro -0.6 billion), which more than offset higher investment income (Euro +0.4 billion), and (iv) lower income from the non-recognition of the underlying earnings of an affiliate (Euro -0.1 billion).FY23  FY24  Change on a comparable basis  FY24 Price effect (in %)Gross written premiums and other revenues  53.0  56.5  +7%  +5.6%o/w Commercial lines  33.0  34.9  +6%  +3.2%o/w Personal lines  17.8  19.1  +7%  +10.0%o/w AXA XL Reinsurance  2.3  2.5  +10%  +5.3%FY23  FY24  Change at constant ForexAll-Year Combined ratio  93.2%  91.0%  -2.1 ptsUnderlying earnings  5,012  5,510  +10%Key figures (in Euro billion, unless otherwise noted)Earnings (in Euro million, unless otherwise noted)LINES OF BUSINESS~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretLife & HealthGross written premiums & other revenues were up 8% to Euro 52.0 billion.• Life premiums increased by 9% to Euro 34.5 billion, driven by (i) Unit-Linked (+18%) from successful commercial initiatives in both France and Italy, (ii) capital-light G/A Savings products (+15%), notably in Japan from elevated sales of a single premium whole-life product, and in Italy and Belgium from the successful launch of new products, (iii) Protection (+3%), notably in Japan and Switzerland, and (iv) traditional G/A products (+1%), mainly in Hong Kong.• Health premiums increased by 8% to Euro 17.5 billion, primarily driven by favorable price effects both in the Group and Individual businesses, across all countries, and higher volumes in the Group business.• Present value of expected premiums (PVEP) was up 14% to Euro 50.9 billion, in Life (+12%), driven by higher volumes in France, Japan and Italy, and in Health (+17%), mainly from France due to higher volumes.• NBV was up 2% to Euro 2.3 billion, in Life (+2%), mainly driven by strong Unit-Linked sales, and in Health (+1%), from the favorable impact of higher volumes and assumption changes, partly offset by a less favorable business mix in France.• NBV margin decreased by 0.5 point to 4.4%, mainly driven by a less favorable mix.• Net flows were at Euro +1.5 billion compared to Euro -4.1 billion in 2023.• Net flows in 2024 were driven by (i) Protection (Euro +3.2 billion), mainly in Hong Kong, Japan, and France, and (ii) Health (Euro +2.7 billion), mainly in Germany, Japan, and France.• This was partly offset by (iii) G/A Savings (Euro -3.6 billion), reflecting outflows in traditional G/A net of inflows in capital-light G/A, as well as (iv) Unit-Linked (Euro -0.8 billion), primarily in Italy.• Life & Health underlying earnings increased by 4% to Euro 3.3 billion, including the net negative impact of scope changes.• Excluding the impact of the scope adjustments, the underlying earnings growth was driven by (i) higher technical profitability in short-term Protection and Health (Euro +0.2 billion), including from the recovery in UK Health as a result of ongoing pricing actions and underwriting measures, (ii) higher financial results from higher investment income (Euro +0.1 billion), (iii) CSM release, which was up 2%, partly offset by (iv) higher taxes (Euro -0.2 billion).Key figures (in Euro billion, unless otherwise noted)   FY23  FY24  Change on a comparable basisGross written premiums & other revenues  48.1  52.0  +8%o/w Life   32.0  34.5  +9%o/w Health  16.1  17.5  +8%PVEP  45.9  50.9  +14%NBV (post-tax)  2.3  2.3  +2%NBV margin  5.0%  4.4%  -0.5 ptNet flows  -4.1  1.5FY23  FY24  Change at constant forexUnderlying earnings  3,232  3,323  +4%o/w Life  2,661  2,636  0%o/w Health  570  687  +24%Earnings (in Euro million)LINES OF BUSINESS~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretAsset ManagementAverage assets under management increased by 3% to Euro 759 billion, reflecting favorable market effects.Asset Management net flows amounted to Euro +3 billion driven by third-party clients (Euro +4 billion) across both AXA IM Core and AXA IM Alts, and Asian JVs (Euro +1 billion), partly offset by negative net flows from AXA Insurance companies (Euro -2 billion).Asset Management revenues increased by 8% to Euro 1.7 billion, mainly driven by higher management fees due to an increase in average assets under management and a better product mix.Underlying cost income ratio decreased by 3.7 points to 68.0%, reflecting the impact of higher revenues.Asset Management underlying earnings were up 11% to Euro 0.4 billion.Holdings Holdings underlying earnings were down Euro 156 million to Euro -1.2 billion, mainly driven by higher expenses from investments in technology and growth initiatives, in line with the Group's strategic plan.FY23  FY24  Change on a comparable basisAUM  843  879  +4%Average AUM  736  759  +3%Net inflows  -11.3  2.5Gross revenues (in Euro million)  1,555  1,701  +8%Underlying cost income ratio  71.6%  68.0%  -3.7 ptsUnderlying earnings (in Euro million)  360  402  +11%Key figures (in Euro billion, unless otherwise noted)LINES OF BUSINESS~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretRatingsThe rating outlook on AXA Group was raised to "positive" by both S&P and Moody's, on February 25, 2025 and October 18, 2024 respectively.AXA maintains up-to-date ratings information on its website at: https://www.axa.com/en/investor/financial-strength-ratings.Glossary• Asset Management net flows: net inflows represent Inflows of client money less outflows of client money.• Net inflows are used by the Management to measure the impact of sales efforts, product attractiveness (mainly dependent on performance and innovation), and the general market trend in investment allocation.• Asset Management cost income ratio: ratio of general expenses excluding distribution-related expenses to gross revenues excluding distribution fees received.• Assets under management ("AUM"): the assets the management of which has been delegated by their owner to an asset management company such as AXA Investment Managers.• AUM only include funds and mandates which generate fees and exclude double counting.• Average assets under management ("Average AUM"): an annual measure of the assets during the period, taking into account net flows, market effect and foreign exchange to compute the year-to-date average.• It also excludes assets held in joint venture companies which are consolidated under the equity method.• Capital-light G/A products: encompass all products with no guarantees, with guarantees at maturity only or with guarantees equal to or lower than 0%.• Contractual service margin ("CSM"): a component of the carrying amount of the asset or liability for a group of insurance contracts representing the unearned profit to be recognized as services are provided to policyholders.• CSM release: the portion of CSM stock net of reinsurance at the end of the defined period flowing through profit and loss representing the estimated profit earned by the insurer for providing insurance services during the reporting period.• Economic variance: the variance of the year-end CSM arising from changes in market conditions, net of the underlying retuon in-force.• Financial result: investment income on assets backing Building Block Approach (BBA) and Premium Allocation Approach (PAA) contracts as well as assets backing shareholder's equity, net of the insurance finance expenses (IFE) defined as the unwind of the present value of future cash flow.Agency  Date of last review  AXA SA  AXA's principal insurance subsidiaries  Outlook  Senior debt of the Company  Short-term debt of the CompanyS&P Global Ratings  February 25, 2025  A+  AA-  Positive  A+  A-1+Moody's Investor Service  October 18, 2024  Aa3  Aa3  Positive  A1  P-1AM Best  October 2, 2024  A+ Superior  Stable  aa- SuperiorInsurer financial strength ratings  AXA's credit ratingsRATINGS AND GLOSSARY~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_Secret• Gross written premiums & other revenues: insurance premium collected during the period (including risk premiums, premiums from pure investment contracts with no discretionary participating features, fees and revenues, net of commissions paid on assumed reinsurance business).• Other Revenues represent premiums and fees collected on activities other than insurance (i.e., banking, services, and asset management activities).• New business contractual service margin ("NB CSM"): a component of the carrying amount of the asset or liability for newly issued insurance contracts during the period, representing the unearned profit to be recognized as insurance contract services are provided.• New business value ("NBV"): the value of newly issued contracts during the current year.• It consists of the sum of (i) the NB CSM, (ii) the present value of the future profits of short-term business newly issued contracts during the period, carried by Life entities, considering expected renewals, and (iii) the present value of the future profits of pure investment contracts accounted for under IFRS 9, net of (iv) the cost of reinsurance, (v) taxes and (vi) minority interests.• New business value margin ("NBV Margin"): the ratio of NBV representing the value of newly issued contracts during the current year to PVEP.• Operating variance: the variation of the year-end CSM vs the expected at opening due to (i) the differences between realized and expected operational assumptions, (ii) changes in assumptions such as mortality, longevity, lapses and expenses, and (iii) impact of model changes.• Operating variance is net of reinsurance.• Present value of expected premiums ("PVEP"): the new business volume, equal to the present value at the time of issue of the total premiums expected to be received over the policy term.• PVEP is discounted at the reference interest rate and PVEP is Group share.• Technical experience: consists of the impacts on the underlying earnings of (i) the difference between the expected and incurred cash-flows of the defined period, (ii) the risk adjustment release, (iii) the changes in onerous contracts and (iv) the other long-term elements which are mainly composed of non-attributable expenses.• Underlying retuon in-force: the release of the time value of options & guarantees plus the unwind of CSM at the reference rate plus the underlying financial over-performance.GLOSSARY~PAGE-BREAK~KEY HIGHLIGHTSGIE_AXA_SecretScopeFrance: includes insurance activities, banking activities and holding.Europe: includes Switzerland (insurance activities), Germany (insurance activities and holding), Belgium (insurance activities and holding) and Luxemburg (insurance activities and holding), United Kingdom and Ireland (insurance activities and holding), Spain (insurance activities and holding), Italy (insurance activities), and AXA Life Europe (insurance activities).AXA XL: includes insurance and reinsurance activities and holding.Asia, Africa & EME-LATAM: includes (i) insurance activities and holding in Japan, insurance activities in Hong Kong, Thailand P&C, Indonesia L&S (excluding the bancassurance entity), China P&C, South Korea, and Asia Holding which are fully consolidated, and China L&S, Thailand L&S, the Philippines L&S and P&C, Indonesian L&S and India (L&S insurance activities until March 11, 2024 and holding) businesses which are consolidated under the equity method and contribute only to NBV, PVEP, the underlying earnings and net income, (ii) Egypt (insurance activities and holding), Morocco (insurance activities and holding) and Nigeria (insurance activities and holding) which are fully consolidated, (iii) Mexico (insurance activities), Colombia (insurance activities), Türkiye (insurance activities and holding) and Brazil (insurance activities and holding) which are fully consolidated, as well as Russia (Reso) (insurance activities) which is consolidated under the equity method and contributes only to the net income, (iv) AXA Mediterranean Holding.Transversal & Central Holdings: includes AXA Assistance, AXA Liabilities Managers, AXA SA and other Central Holdings.AXA Investment Managers: includes AXA Investment Managers, Select (previously referred to as Architas) and Capza which are fully consolidated and Asian joint ventures which are consolidated under the equity method.Exchange ratesFor 1 Euro  FY23  FY24  FY23  FY24USD  1.10  1.04  1.08  1.08CHF  0.93  0.94  0.97  0.95GBP  0.87  0.83  0.87  0.85JPY  156  163  152  164HKD  8.63  8.04  8.47  8.44End of Period Exchange rate  Average Exchange rateSCOPE AND EXCHANGE RATES~PAGE-BREAK~

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AXA SA published this content on February 27, 2025, and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on February 27, 2025 at 06:01:00.400.