Generali, half-year profit of 1.4 billion after writedowns in Russia

General archives the first half of the year with a Net income of 1.4 billion euros, down 9% on an annual basis. The result of the insurance group is affected by the write-downs on investments in Russia for 138 million: 97 million on fixed-income securities held directly and 41 million on the investment in the company Ingosstrakh, which is written down by 70%. And, again on the Russian front, since July 1st, Europ Assistance has quit its activities in the country. Without the impact of the write-downs, the net result would have been stable at 1,541 million, while the Operating income confirmed growth to 3.14 billion (+ 4.8%), beyond the consensus of analysts. THE gross premiums they are up to € 41,880 million (+ 2.4%), driven by the development of the Non-Life segment.

The Solvency Ratio stood at 233%, from 227% at the end of 2021. In Life segment the operating result jumped to 1.7 billion (+ 17.1%), in Damage premiums increased to 14.6 billion (+ 8.5%), with the Combined Ratio at 92.5%, and the operating result at 1.3 billion (+ 3%). In the segment asset & wealth management the operating result of Asset Management was 325 million (+ 6.2%). Given the results for the half year, the group confirms the financial targets set out in its three-year plan.

“The solid results of Generali demonstrate that our commitment to the implementation of the strategic plan ‘Lifetime Partner 24: Driving Growth’ is the right way to achieve sustainable growth and increase operational profitability”, comments the group ceo Philippe Donnet. “We have been able to achieve these results in a context of growing geopolitical and macroeconomic uncertainty, always keeping our customers and their needs as a top priority.”

But, Donnet announces, “we will raise the prices to mitigate the impact ofinflation on claims costs and expenses. Inflation by definition means an increase in prices and this also applies to insurance prices, so there will be significant price increases. “

Meanwhile theexposure of Generali sui Italian government bonds it dropped to 52.8 billion euros from 63 billion at market values ​​at the end of 2021. On the political front, continues Donnet, “what the markets don’t like is uncertainty. Elections will soon take place and I am very confident that Italian politics will be able to set up a responsible government and continue along the path of reforms. We are careful but not worried “.

The group also announced the launch of the buyback program up to 500 million euros, for a maximum number of shares corresponding to 3% of the company’s share capital. Generali has signed a buyback agreement with Ubs Europe. The minimum purchase price of the shares cannot be lower than the implicit nominal value of the share, currently equal to one euro, while the maximum purchase price cannot exceed by 5% the reference price that the share will have recorded in the trading session of the day preceding the completion of every single purchase transaction.