Pre-tax loss of €187m halves annual profit as ratios rise

Allianz has announced a loss for its fourth quarter and that revenues fell by 10% giving a full year revenue fall of more than 5% and pre-tax profits nearly halved.

Full year highlights:

  • Operating profit of €7.4bn down 27.9%
  • Of which property and casualty €5.6bn, down 10.3%
  • Pre-tax profit of €5.4bn, down 48.2%
  • Net loss of 2.4bn Euros from a profit in 2007 of 7.9bn Euros
  • P&C combined ratio of 95.1%, up from 93.6%

The fourth quarter figures were:

  • Revenues of €23bn, down 10.1%
  • Operating profit of €956m, down 63.2%
  • Of which P&C €1.2bn, down 25%
  • Pre-tax loss of €187m, from a 2007 fourth quarter profit of €1.8bn
  • Net loss of €3.1bn, from 2007 fourth quarter profit of €665m
  • P&C combined ratio of 95.8%, compared with 2007 90.9%

The company said: “Property and Casualty insurance, the largest business segment for Allianz, presented a stable profile last year. Premium income increased slightly from €43.2bn to €43.4bn (adjusted for the transfer of AGF’s health insurance business to the Life/Health segment). Internal growth amounted to 1.7%. An operating profit amounting to €5.6bn was achieved, which is a decline of approximately 10% compared to 2007. The combined ratio reached 95.1% in 2008, compared to 93.6% in the previous year. As a result of successful efficiency programs and despite negative price effects, the increase in the combined ratio of 1.5 percentage points remains lower than the rate of claims inflation.”

Helmut Perlet, chief financial officer, said: "Under the prevailing market conditions, Property and Casualty insurance generated a good result and maintained a stable combined ratio. Once more this reflected the positive result of our consistent underwriting policy, price discipline and improved efficiency."

Michael Diekmann, CEO, said: "The difficult conditions in the capital markets will continue throughout 2009. We are in the midst of the toughest economic downturn for decades. Reliable profit forecasts for 2009 are not possible in this environment.”

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