TALANX AG Talanx:
Sustainable profitability
Berenberg European Conference | Manhattan, 22 May 2024
Jan Wicke, CFO
Agenda
1 Talanx at a glance
2 Group highlights
3 Segment highlights and outlook
4 Group outlook
5 Appendix
2 Berenberg European Conference | Manhattan, 22 May 2024
1 Talanx has a history of 120 years
Talanx IPO
Gerling | |||||||||||||
acquisition | |||||||||||||
Hannover Re | |||||||||||||
IPO | 2012 | ||||||||||||
Foundation | Foundation | ||||||||||||
Entry retail | reinsurance | 2006 | |||||||||||
as a liability | |||||||||||||
& fire | business | 1994 | |||||||||||
mutual | |||||||||||||
1966
1953
1903
2023
EUR 1.6bn net income
3 | Berenberg European Conference | Manhattan, 22 May 2024 |
1 Talanx operates a multi-brand business with 4 segments and …
TOP 6
insurance provider in Europe1
Industrial | Retail | Retail | Reinsurance |
Lines | Germany | International |
~75%
in hard B2B markets
More than
175 countries
~ 29,000
employees worldwide
1 Based on insurance revenue; source: company publications, as of 3 April 2024
4 | Berenberg European Conference | Manhattan, 22 May 2024 |
1 … a well-balanced business with a low risk profile
Underwriting
Insurance revenue, 2023, in EURbn
LatAm | ||||
10% | APAC | |||
North | 13% | Others | ||
America | ||||
1% | ||||
29% | 43 | |||
EURbn | ||||
31% | ||||
15% | Rest of | |||
Europe |
Germany
Investments
Investment portfolio as of 31 Mar 2024, in EURbn
Fixed-income securities
81%
138
EURbn
18%
1%Others Equities
Solvency
Solvency 2 CAR for HDI Group as of 31 Mar 2024
217%
Ratings
Insurer financial strength rating (Talanx Primary Group)
A+
(outlook: stable)
A+
(outlook: stable)
Strong | Low | |
diversification | investment risk | |
Solid
capitalisation
Strong ratings
5 Berenberg European Conference | Manhattan, 22 May 2024
1 Significantly improved market cap and trading liquidity…
Market | Share price | Trading |
capitalisation | performance | liquidity |
in EURbn | in % | Average daily turnover2, in EURm |
16,7 | |
11,2 | |
2022 | 2023 |
+46% | |
+13% | |
Peer - Ø 20231 | Talanx 2023 |
9,9 | |
3,6 | |
2022 | 2023 |
> 5bn | Top performing insurance stock in | Trading volume | ||
value creation in 2023 | Europe in 2023 | more than doubled | ||
Note: All share prices and market data as of 29 Dec 2023
1 Peers include Allianz, AXA, Generali, Mapfre, Zurich, VIG, Munich Re, Swiss Re | 2 Source: Refinitiv, XETRA trading data only
6 Berenberg European Conference | Manhattan, 22 May 2024
1 … take Primary Insurance to new valuation levels
Development of market capitalisation
In EURbn | 17.81 | ||||||
19 | |||||||
18 | |||||||
+59% | 4.22 | ||||||
17 | Primary | ||||||
16 | P/E 232 | ||||||
15 | Insurance | 5.3x | |||||
14 | |||||||
13 | |||||||
11.2 | |||||||
12 | |||||||
Hannover Re | 13.6 | ||||||
11 | |||||||
(50.2%) | |||||||
10 | |||||||
9 | |||||||
8 | |||||||
15 May 2024 | |||||||
30 Dec 2022 | |||||||
Source: FactSet | Note: Primary Insurance is here defined as Talanx market cap minus half of Hannover Re market cap.
1 Market capitalisation as of 15 May 2024 | 2 Implied valuation of Primary Insurance = EUR 4.2bn (based on Hannover Re market capitalisation of EUR 27.1bn as of 15 May 2024) translating into P/E23 of ~ 5.3x based on net income of EUR 790m (sum of net income of Primary Insurance segments Industrial Lines, Retail Germany and Retail International)
7 Berenberg European Conference | Manhattan, 22 May 2024
Agenda
1 Talanx at a glance
2 Group highlights 2023 and Q1 2024
3 Segment highlights and outlook 2024
4 Group outlook
5 Appendix
8 Berenberg European Conference | Manhattan, 22 May 2024
2 2023 was another record year …
Record result | High quality earnings | Increased dividend |
Net income | Resiliency2 | Dividend per share3 | ||
in EURm | in EURm | in EUR | ||
1,5811 | 3,704 | 2.35 | ||
Ahead of schedule for 2025 strategic targets
1 IFRS 4 2022: EUR 1,172m (2023 vs. 2022: + 35%); IFRS 17 2022: EUR 706m, no meaningful base for comparison given different treatment of management actions taken in 2022 under IFRS 4 accounting regime | 2 Resiliency embedded in best estimate defined as the difference between booked reserves (based on Talanx' own best estimates) and WTW analysis. WTW calculation based on data provided by Talanx. 2023 figures are based on IFRS 17 without considering discounting to enable comparability with IFRS 4 figures of previous years | 3 Dividend for 2023 paid on 13 May 2024
9 Berenberg European Conference | Manhattan, 22 May 2024
2 … followed by a head start into 2024
Results | Capital |
Revenue growth | Earnings growth | Resiliency2 | Solvency 2 ratio |
Q1 2024 vs Q1 2023 | Net income Q1 2024 vs Q1 2023 | 31 Dec 2023 vs 31 Dec 2022 | as of 31 Mar 2024 |
+9 %1 | +35 % | +1.4 %pts3 | 217 % |
(+ ~EUR 1.1bn4) |
Bottom-line outpacing top-line growth with strengthened balance sheet
1 Currency adjusted: 10% | 2 Resiliency embedded in best estimate for P/C net claims reserves as of year end. Resiliency defined as the difference between booked reserves (based on Talanx' own best estimates) and WTW analysis | 3 Chang e in
level of resiliency embedded in best estimate for P/C net claims reserves in % of total P/C net claims reserves (2022: 4.9% vs 2023: 6.3%) | 4 Undiscounted; 31 Dec 2023: EUR 3,704m; 31 Dec 2022: EUR 2,643m
10 Berenberg European Conference | Manhattan, 22 May 2024
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Talanx AG published this content on 22 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 22 May 2024 06:35:06 UTC.
