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PARIS, Aug. 5 /PRNewswire-FirstCall/ --
Earnings recovery in 1H09 versus 2H08:
-- Underlying Earnings: Euro 2,116 million down 26% yoy, up 63%
sequentially
-- Adjusted Earnings: Euro 1,736 million down 50% yoy, up 327%
sequentially
-- Net Income: Euro 1,323 million down 38% yoy, up Euro 2,577 million
sequentially
Confirmation of financial strength:
-- Solvency I ratio: 133% up 6 pts vs. December 31, 2008
-- Shareholders' equity: Euro 38.8 billion up Euro 1.4 billion vs.
December 31, 2008
-- Debt gearing: 31% down 3 pts vs. December 31, 2008
Overall resilient customer base:
-- Revenues: Euro 48.4 billion down 1.8% yoy (down 5.7% on a comparable
basis)
-- Positive Insurance net inflows
-- Assets under Management: Euro 967 billion down 1.5% vs. December 31,
2008
Strong management actions to weather the market turmoil:
-- Focus on profitability in Property & Casualty and Life & Savings
(Variable Annuities) through repricing measures
-- Productivity efforts in all business lines
-- Risk Management actions, notably in the US (stabilizing capital and
improved Variable Annuity hedging margin)
Chairman's statement
"Our confidence in AXA Group's strategy is supported by the solid performance recorded during the first half of 2009, as well as the efficiency of the risk management actions undertaken to mitigate the consequences of the crisis," said Henri de Castries Chairman of the AXA Management Board.
The insurance sector and AXA were not immune to the adverse market environment. However, the Group demonstrated its capacity to act quickly and to take the necessary actions in order to preserve a solid balance sheet, manage business efficiently and maintain the trust of our customers.
Going forward, we are prepared to withstand a further possible market downturn and we are well positioned to benefit from a market upturn: we have not stopped investing and focusing on our core business in a market with continuing growth potential."
All comments are on a comparable basis (constant Forex, scope and methodology for activity indicators and constant Forex for earnings)
Revenues
-- Total Revenues were down 6% to Euro 48,414 million.
-- Life & Savings revenues were down 7% to Euro 30,065 million, in
line with trends observed in 4Q08 and 1Q09, mostly due to the
adverse market environment.
Net inflows remained positive at Euro +5.6 billion, flat on a
comparable basis versus 1H08. New Business Volume (APE(1)) was
down 16% to Euro 3,111 million, with unit-linked share down from
48% to 40%.
New business margin was down 0.9 pt to 13.7%.
-- Property & Casualty revenues increased by 1% to Euro 14,919
million, driven by Personal lines (+1%) while Commercial lines
remained stable. Personal Net New contracts amounted to +695,000.
-- Asset Management revenues were down 34% to Euro 1,503 million, due
to 36% lower management fees mainly driven by lower average assets
under management (-26%), unfavorable change in product mix, as well
as the reduced contribution from distribution fees. Net outflows
amounted to Euro -38 billion.
Earnings
1H09 earnings were significantly up versus 2H08: Underlying Earnings were up 63% to Euro 2,116 million, Adjusted Earnings were up 327% to Euro 1,736 million and Net Income was up Euro 2,577 million to Euro 1,323 million.
Compared to 1H08:
-- Underlying Earnings were down 26% to Euro 2,116 million, mainly due to
(i) lower average assets under management negatively impacting
underlying earnings in both Life & Savings (down 16%) and Asset
Management (down 42%), and (ii) combined ratio up 1.7pts to 98.0%
(mostly related to natural events) impacting underlying earnings in
Property & Casualty (down 12%).
-- Adjusted Earnings were down Euro 1,640 million (-50%) to Euro 1,736
million, as a result of (i) Euro 714 million lower underlying
earnings, (ii) Euro 614 million lower realized capital gains (mostly
on equities), (iii) Euro 312 million higher impairments net of hedging
(mostly on equities).
-- Net Income was down Euro 821 million (-38%) to Euro 1,323 million as a
result of (i) Euro 1,640 million lower adjusted earnings, partly
offset by (ii) Euro 819 million lower negative contribution from
change in value of assets and derivatives net of forex and other
items, mainly due to credit spread tightening.
Balance sheet
-- Group Solvency I ratio was up 6 pts (vs. December 31, 2008) to
133%, as a result of 10 pts positive impact from underlying
earnings partly offset by 4 pts adverse impact notably from real
estate and private equity asset valuations. Solvency I surplus
increased by Euro +1 billion to Euro 7 billion. Stabilizing
capital situation in the US: no capital increase expected this
year.
-- Shareholders' equity was up Euro 1.4 billion (vs. December 31,
2008) to Euro 38.8 billion, as a result of (i) Euro 1.3 billion of
net income contribution, (ii) Euro 0.9 billion positive variation
in unrealized capital gains (mostly related to equities), partly
offset by (iii) Euro 0.8 billion dividend payment.
Debt gearing(2) was down 3 pts (vs. December 31, 2008) to 31%
mainly as a result of Euro 2.0 billion lower net financial debt
partly due to seasonality effect.
Non-GAAP measures such as Underlying Earnings and Adjusted Earnings are reconciled to Net Income on page 7 of this release. AXA's 1H09 financial statements are subject to completion of limited review by AXA's independent auditors.
Notes are on page 12
Revenues: Key figures
Change
----------------------
Change
Euro million, on a Scope
except when reported Comp.(a) & FX
otherwise noted 1H08 1H09 basis basis Other Impact(b)
----------------- ---- ---- ----- ----- ----- --------
Life & Savings revenues 30,826 30,065 -2.5% -7.5% +0.7pt +4.3pts
Net inflows (Euro
billion) +6.2 +5.6
APE (Group share) 3,611 3,111 -13.9% -16.3% +1.1pts +1.3pts
NBV (c) (Group
share) 505 427 -15.3% -22.0% +1.0pt +5.7pts
NBV to APE margin (Group
share) 14.0% 13.7% -0.2pt -0.9pt
------------------------ ---- ---- ------ ------
Property & Casualty
revenues 14,519 14,919 +2.8% +0.8% +3.8pts -1.8pts
------------------- ------ ------ ---- ---- ------- -------
International Insurance
revenues 1,673 1,731 +3.5% +2.7% +1.1pts -0.3pt
----------------------- ----- ----- ---- ---- ------- --------
Asset Management
revenues 2,102 1,503 -28.5% -34.0% -0.1pt +5.4pts
Net inflows (Euro
billion) +2.2 -37.7
----------------- ---- -----
Total revenues 49,319 48,414 -1.8% -5.7% +1.5pts +2.3pts
-------------- ------ ------ ---- ---- ------- -------
(a) Change on a comparable basis was calculated at constant FX and scope.
(b) Mainly appreciation of the Euro against GBP and depreciation against
USD and JPY.
(c) New Business Value.
Life & Savings
Positive net inflows despite negative new business momentum
-- Life & Savings revenues were down 7% to Euro 30,065 million, in
line with trends observed in 4Q08 and 1Q09, mostly due to the
adverse market environment.
Net inflows remained positive at Euro +5.6 billion, flat on a
comparable basis versus 1H08, as lower inflows (Euro -3.4 billion)
were offset by higher client retention (Euro +3.4 billion). Net
inflows were positive in both General Account (Euro +2.1 billion)
and Unit-linked (Euro +3.5 billion) businesses.
Net Inflows by country/region
-----------------------------
Euro billion 1H08 1H09
------------ ---- ----
United States +1.6 +0.7
France +1.4 +2.2
United Kingdom(a) -0.5 -0.3
NORCEE(b) +2.6 +1.6
Asia Pacific(c) +0.9 +0.8
MedLA(d) +0.2 +0.7
----------- ---- ----
Total L&S Net Inflows +6.2 +5.6
--------------------- ---- ----
(a) UK Net Inflows, excluding with-profit funds, stood at Euro+0.4 billion
at June 30, 2009.
(b) Northern Central and Eastern Europe: Germany, Belgium, Switzerland,
Central & Eastern Europe and Luxemburg.
(c) Asia Pacific: Australia, New Zealand, Hong Kong, Japan and South-East
Asia.
(d) Mediterranean and Latin American Region: Italy, Spain, Portugal,
Turkey, Mexico, Greece and Morocco.
-- New Business Volume (APE1) was down 16% to Euro 3,111 million, mainly
due to:
(i) Adverse market environment:
-- Decline in individual investments & savings sales mainly
in the US, Australia, the UK and Belgium
-- Decrease in group life sales in Switzerland as a result of
limited client turnover in the market
(ii) Negative impact from one-off events, mainly in Japan
(bankruptcy of a major independent agent) and Germany (non
recurring 2008 Riester incentive measures)
(iii) Partly offset by a solid performance in France (+13%), with
positive developments in both group and individual business.
The unit-linked share was down from 48% to 40%, notably impacted by France and the US.
Annual Premium Equivalent by country
------------------------------------
Euro million Change on Change on
a a
reported comparable
1H08 1H09 basis basis
------------ ---- ---- ---------- ----------
United States 808 576 -28.7% -37.8%
France 690 776 +12.5% +12.5%
United Kingdom 692 493 -28.7% -17.7%
NORCEE (a) 660 562 -14.8% -16.0%
Asia Pacific (b) 558 483 -13.3% -24.8%
MedLA(c) 204 219 +7.3% -4.0%
------------ --- --- ---- ----
Total Life &
Savings APE 3,611 3,111 -13.9% -16.3%
------------ ----- ----- ----- -----
(a) Northern Central and Eastern Europe: Germany, Belgium, Switzerland
and Central and Eastern Europe. Luxemburg's APE and NBV are not yet
modelled.
(b) Asia Pacific: Japan, Australia/New-Zealand, Hong-Kong, South East
Asia & China. India's APE and NBV are included in South-East Asia &
China's APE and NBV from 1H09 (Changes on comparable basis calculated
including India's 1H08 APE and NBV, consolidated under the equity
method).
(c) Mediterranean and Latin American Region: Italy, Spain, Portugal,
Turkey, Mexico and Greece. 1H08 APE and NBV included Turkey at 50%,
1H09 APE and NBV include Turkey at 100%. (Changes on comparable basis
calculated including Turkey's 1H08 APE and NBV at 100%.). Morocco's
APE and NBV are not yet modelled.
Stabilizing NBV margin
New business margin was down 0.9pt to 13.7%, mostly as a result of (i) lower interest rates impacting Variable Annuity products, (ii) higher unit costs in most countries due to lower volumes, partly offset by (iii) favorable business mix mainly driven by the US (progressive development of new redesigned Accumulator products), as well as Japan and the UK.
(Chart: http://www.newscom.com/cgi-bin/prnh/20090805/NY57078-a)
Note: Actuarial and financial assumptions are not updated on a half year basis, except for interest rates which are hedged at point of sale for Variable Annuity products
Property & Casualty
Growing Personal lines
Stable Commercial lines
Property & Casualty revenues increased by 1% to Euro 14,919 million, driven by Personal lines (+1%) while Commercial lines remained stable:
Property & Casualty : IFRS revenues by country
----------------------------------------------
In Euro million Change on a Change on a
reported comparable
1H08 1H09 basis basis
------------------- ---- ---- ------ ------
NORCEE(a) 5,224 5,394 +3.3% +1.0%
of which Germany 2,199 2,206 +0.3% +0.3%
of which Switzerland 1,805 1,957 +8.4% +1.6%
of which Belgium 1,155 1,160 +0.5% +0.5%
France 3,021 3,088 +2.2% +2.2%
United Kingdom &
Ireland 2,389 2,048 -14.2% -2.0%
MedLA(b) 2,984 3,402 +14.0% -1.3%
Rest of the World 902 986 +9.3% +10.9%
------------------ --- --- ---- -----
Total P&C revenues 14,519 14,919 +2.8% +0.8%
------------------ ------ ------ ---- ----
(a) Northern Central and Eastern Europe: Germany, Belgium, Switzerland,
Central and Eastern Europe and Luxembourg
(b) Mediterranean and Latin American Region: Italy, Spain, Portugal,
Turkey, Mexico, Gulf region, Greece and Morocco.
Revenues increased in Personal lines with Net new personal contracts amounting to +695,000.
-- Personal Motor revenues (35% of total P&C revenues) were up 1% mainly
driven by higher volumes in the Direct business (UK, Asia and France),
partly offset by Spain and Germany, operating in difficult market
conditions.
-- Personal Non-Motor revenues (24% of total P&C revenues) increased by
1% mainly due to Canada and France, partly offset by the UK.
Revenues were stable in commercial lines.
-- Commercial Motor revenues (7% of total P&C revenues) were down 1%
driven by lower volumes in the UK and France partly compensated by the
Gulf region and Asia.
-- Commercial Non-Motor revenues (33% of total P&C revenues) were stable
as negative evolution in Spain and the UK was offset by Switzerland
(mainly new Health contracts), Turkey (SME business) and Mexico
(renewal of a large contract).
Asset Management
Revenues mainly driven by lower average Assets Under management
-- Asset Management revenues were down 34% to Euro 1,503 million, due to
36% lower management fees mainly driven by lower average assets under
management (-26%), unfavorable change in product mix, as well as a
reduced contribution from distribution fees.
-- Assets Under Management were down Euro 13 billion (vs. December 31,
2008) to Euro 803 billion(3) at June 30, 2009:
-- Net inflows: Euro -38 billion due to AllianceBernstein (Euro -33
billion, mostly in the Institutional channel) and AXA Investment
Managers (Euro -5 billion),
-- Market appreciation: Euro +18 billion, mostly at
AllianceBernstein,
-- Forex, scope & other impacts: Euro +6 billion mainly due to the
positive evolution of the GBP.
Assets Under Management Roll-forward
------------------------------------
In Euro billion Alliance
Bernstein AXA IM Total
--------------- --------- ------ -----
AUM at FY08 331 485 816
----------- --- --- ---
Net inflows -33 -5 -38
Market appreciation +22 -4 +18
Scope & other impacts - +1 +1
Forex impact -2 +7 +5
------------ -- -- --
AUM at 1H09 318 485 803
----------- --- --- ---
Average AUM over the period
(FY08-1H09) 325 474 799
--------------------------- --- --- ---
Change of average AUM 1H09 vs.
1H08
------------------------------
On a reported basis -34% -11% -22%
On a comparable basis -43% -10% -26%
--------------------- --- --- ---
International Insurance
International Insurance revenues were up 3% to Euro 1,731 million, with (i) AXA Corporate Solutions Assurance up 3%, driven mainly by positive business developments in Liability, as well as (ii) AXA Assistance up 3%.
International Insurance IFRS revenues
-------------------------------------
In Euro million Change on Change on
a a
reported comparable
1H08 1H09 basis basis
-------------- ---- ---- ----- ------
AXA Corporate
Solutions Assurance 1,220 1,256 +2.9% +2.9%
AXA Assistance 362 366 +1.1% +3.2%
AXA Cessions 53 57 +8.3% +8.3%
Other International
activities 37 52 +38.4% -14.3%
------------------- -- -- ----- -----
Total International
Insurance 1,673 1,731 +3.5% +2.7%
------------------- ----- ----- ---- ----
Earnings : Key figures
----------------------
In Euro million Change
-------------------
on a
comparable
1H08 1H09 Reported basis
---- ---- --------- ----------
Life & Savings 1,396 1,232 -12% -16%
Property & Casualty 1,133 986 -13% -12%
Asset Management 285 176 -38% -42%
International Insurance 172 122 -29% -30%
Banking 24 15 -38% -40%
Holdings(4) -245 -415 69% 67%
-------------- ----- ----- --- ---
Underlying
Earnings(5) 2,766 2,116 -24% -26%
-------------- ----- ----- --- ---
Net realized
capital gains 834 241 -71% -74%
Net impairments -786 -691 -12% -12%
Equity portfolio hedging
(intrinsic value) 477 71 -85% -85%
------------------ --- -- --- ---
Adjusted Earnings(5) 3,290 1,736 -47% -50%
-------------------- ----- ----- --- ---
Change in the fair value -1,012 -280
Of which from credit spreads n.a. 309
Of which MtM of alternative
investments n.a. -317
Of which MtM effects of
Derivatives related to
balance sheet items n.a. -210
including interest
rate derivatives -87 89
including FX and related
derivatives (excluding
impairments) -113 45
including time value of
equity hedging -152 -290
Of which MtM of ABS -237 -62
Other -116 -134
----- ---- ----
Net income 2,162 1,323 -39% -38%
---------- ----- ----- --- ---
Earnings per share
------------------
In Euro
-------
Underlying EPS(6) 1.28 0.95 -26%
----------------- ---- ---- ---
Adjusted EPS(6) 1.54 0.77 -50%
-------------- ---- ---- ---
Net income per share 1.07 0.50 -53%
-------------------- ---- ---- ---
Items of the analysis of change in fair value are Non-GAAP measures and as such are not audited
Underlying Earnings
Compared to 2H08, Underlying Earnings were up 63% to Euro 2,116 million mainly as a result of improvement in Variable Annuity hedging margin.
Compared to 1H08, Underlying Earnings were down 26% to Euro 2,116 million, mainly due to (i) lower average assets under management negatively impacting underlying earnings in both Life & Savings (down 16%) and Asset Management (down 42%), and (ii) combined ratio up 1.7pts to 98.0% (mostly related to natural events) impacting underlying earnings in Property & Casualty (down 12%).
Life & Savings: lower margins on assets partly offset by higher technical margin
-- Life & Savings Underlying Earnings were down 16% to Euro 1,232
million.
Margin on revenues was down 2%(7) to Euro 2,219 million as the decrease in revenues (-7%) was partly offset by higher margins (+6%) mainly resulting from an improved country mix.
Margin on assets was down 22%(7) to Euro 2,209 million:
-- Unit-linked management fees were down 21%(7) to Euro 865 million,
impacted by lower average reserves (-18%) as well as lower margins
(-3%) driven by an unfavourable country mix.
-- General Account investment margin was down 23%(7) to Euro 1,057
million, as a consequence of lower returns in the US, France and the
UK (mainly dividend yield). Average General Account reserves were
stable.
-- Other fees were down 24%(7) as a result of lower mutual funds under
management.
Technical margin was up 85% to Euro 1,099 million mainly benefiting from (i) Euro 199 million improvement in Variable Annuity hedging margin in the US (breakeven in 1H09) as a result of significantly lower basis cost, credit spreads tightening and gains from interest rate hedging partly offset by higher financial market volatility, (ii) Euro 165 million one-off gain in the UK following internal restructuring of an annuity portfolio and (iii) Euro 71 million higher prior year reserve developments in Group Health and Life in France.
Expenses, net of DAC/DOC were up 6%(7) to Euro 3,639 million, with acquisition expenses up 10% mainly due to higher DAC amortization partly offsetting technical margin gains, and administrative expenses up 2%.
Expenses gross of DAC/DOC as a percentage of reserves were flat at 1.7%(8).
VBI amortization was down 12%(7) to Euro 137 million.
Tax and minority interests were down 15%(7) to Euro 512 million mainly driven by lower pre-tax earnings.
Property & Casualty combined ratio up 1.7 pts to 98.0%, reflecting adverse natural events
-- Property & Casualty Underlying Earnings were down 12% to Euro 986
million mainly due to the deterioration of the combined ratio (up 1.7
pts to 98.0%).
Property & Casualty : Combined ratio by country
-----------------------------------------------
Change on a
comparable
In % 1H08 1H09 basis
--- ---- ---- -------------
NORCEE (a) 96.7 96.8 +0.1pt
of which Belgium 98.0 99.0 +1.0pt
of which Switzerland 92.8 93.9 +1.1pts
of which Germany 98.0 97.0 -1.0pt
France 96.9 99.4 +2.6pts
MedLA (b) 93.8 97.3 +3.8pts
UK & Ireland 98.2 100.3 +2.2pts
Rest of the world 97.1 96.4 -0.7pt
----------------- ---- ---- ------
Total P&C 96.4 98.0 +1.7pts
--------- ---- ---- -------
(a) Northern Central and Eastern Europe: Germany, Belgium,
Switzerland, Central and Eastern Europe and Luxembourg
(b) Mediterranean and Latin American Region: Italy, Spain, Portugal,
Turkey, Mexico, Gulf region, Greece and Morocco
Loss ratio increased by 2.0 points to 70.3%, as a result of:
-- +2.1 points from natural events (mainly Klaus storm in continental
Europe),
-- +1.6 points from current year loss ratio excluding natural events (o/w
-0.1 point of pricing, +0.8 point of frequency and severity, +0.3
point in Health, +0.2 point of business mix and +0.4 point of other
incl. reinsurance),
-- +0.2 point of scope,
-- -2.0 points from higher favorable prior year reserve developments
Reserves ratio(9) stood at 198%, flat versus last year.
(Chart: http://www.newscom.com/cgi-bin/prnh/20090805/NY57078-b)
Expense ratio improved by 0.2 point to 27.7% with administrative expense ratio down 0.5 point and acquisition expense ratio up 0.3 point.
Investment income(10) was down 3% to Euro 1,105 million mainly reflecting a drop in asset yield (-4%) while average assets were up +1%.
Tax and minority interests were down 21% to Euro 377 million mainly due to lower pre-tax earnings.
Asset Management: Lower fees on AUM partly offset by lower expenses
-- Asset Management Underlying Earnings were down 42% to Euro 176
million. AllianceBernstein Underlying Earnings were down 35% to Euro
95 million as the decrease in revenues (-40%) was partly offset by
lower expenses (-22%11) and a favorable one-off tax impact (Euro +65
million).
AXA Investment Managers Underlying Earnings were down 47% to Euro 81
million, as a result of lower revenues (-24%) and the non-recurrence
of 1H08 investment result (carried interest), partly offset by lower
expenses (-18%11).
-- International Insurance Underlying Earnings were down 30% to Euro 122
million, mainly as a result of a lower contribution from the Property
& Casualty run-off portfolio, while AXA Corporate Solutions Assurance
underlying earnings were up 7% (losses on Aviation being more than
offset by the non-recurrence of 2008 large claims in Property).
-- Banking Underlying Earnings were down 40% at Euro 15 million, mainly
due to higher provisions for doubtful receivables on loans.
-- Holdings(6) Underlying Earnings decreased by Euro 164 million on a
comparable basis to Euro -415 million, mainly due to higher financing
costs related to currency impacts and 2H08 acquisitions, lower result
on hedging of earnings denominated in foreign currencies and higher
administrative costs partly offset by lower taxes.
Adjusted Earnings
Compared to 2H08, Adjusted Earnings were up 327% to Euro 1,736 million benefiting from higher realized capital gains and lower impairments.
Reduced net realized capital gains on equities
Compared to 1H08, Adjusted Earnings were down Euro 1,640 million (-50%) to Euro 1,736 million, as a result of (i) Euro 714 million lower underlying earnings, (ii) Euro 614 million lower realized capital gains (mostly on equities), (iii) Euro 312 million higher impairments net of hedging (mostly on equities).
In 1H09, realized capital gains amounted to Euro 241 million.
Impairments amounted to Euro -691 million, of which Euro -339 million on equities, Euro -162 million on fixed income assets and Euro -191 million on private equity, real estate and other. Equity hedges had a positive impact of Euro 71 million.
Net Income
Credit spread tightening positively impacting Net Income
Compared to 2H08, Net Income was up Euro 2,577 million to Euro 1,323 million, benefiting from favorable credit spread evolution.
Compared to 1H08, Net Income was down Euro 821 million (-38%) to Euro 1,323 million as a result of (i) Euro 1,640 million lower adjusted earnings, partly offset by (ii) Euro 819 million lower negative contribution from change in value of assets and derivatives net of forex and other items, mainly due to credit spread tightening.
1H09 change in fair value amounted to Euro -280 million mainly as a result of:
1. Euro +309 million impact from credit spreads, offset by
2. Euro -317 million mark to market of alternative assets (mainly private
equity)
3. Euro -290 million of equity derivatives (including Euro -220 million
hedging program in the US to protect balance sheet)
Balance sheet
Confirmation of financial strength
-- Group Solvency I ratio was up 6 pts (vs. December 31, 2008) to 133%,
as a result of 10 pts positive impact from underlying earnings partly
offset by 4 pts adverse impact notably from real estate and private
equity asset valuations. Solvency I surplus increased by Euro +1
billion to Euro 7 billion. Stabilizing capital situation in the US: no
capital increase expected this year.
-- Shareholders' equity was up Euro 1.4 billion (vs. December 31, 2008)
to Euro 38.8 billion, as a result of (i) Euro 1.3 billion of net
income contribution, (ii) Euro 0.9 billion positive variation in
unrealized capital gains (mostly related to equities), partly offset
by (iii) Euro 0.8 billion dividend payment.
-- Debt gearing(2) was down 3 pts (vs. December 31, 2008) to 31% mainly
as a result of Euro 2.0 billion lower net financial debt partly due to
seasonality effect.
Invested assets
AXA's invested assets amounted to Euro 561 billion including a Euro 391 billion General Account, invested in a diversified portfolio comprised of fixed income investments (79%), cash (7%), real estate (5%), listed equities (4%), policy loans (2%) and alternative investments (2%).
Changes vs. December 31, 2008 were attributable to:
-- Asset movements with notably:
-- Increased investments in govies (Euro +10 billion) notably
benefiting from reduced corporate bond CDS positions (Euro 6
billion) and net inflows
-- Sale of listed equities
-- Lower cash mainly due to a Euro 3 billion decrease related to cash
used to settle Variable Annuity hedge positions, mainly as a
result of higher interest rates in the US
-- Change in asset values mainly related to
-- Corporate bonds valuation up as a result of spread tightening
-- ABS values down 3 pts to 66% of par, notably on CLO's and non
conforming RMBS
-- Real estate down ca. 6% and private equity down ca. 13%
Notes
1. Annual Premium Equivalent (APE) represents 100% of new business regular
premiums + 10% of new business single premiums. APE is Group share.
2. (net financing debt + perpetual subordinated debt) / (shareholders'
equity, excluding fair value recorded in shareholders' equity + net
financing debt)
3. The difference with Euro 967 billion of total assets under management
corresponds to assets directly managed by AXA insurance companies
4. And other companies
5. Underlying earnings are Adjusted earnings, excluding net capital gains
attributable to shareholders. Adjusted earnings represent Net income
before the impact of exceptional operations, goodwill and related
intangibles amortization/impairments, and profit or loss on financial
assets (classified under the fair value option) and derivatives. Life &
Savings NBV and APE, adjusted and underlying earnings are non-GAAP
measures and as such are not audited, may not be comparable to
similarly titled measures reported by other companies, and should be
read together with our GAAP measure. Management uses these non-GAAP
measures as key indicators of performance in assessing AXA's various
businesses and believes that the presentation of these measures provide
useful and important information to shareholders and investors as
measures of AXA's financial performance.
6. Net of interest charges on perpetual subordinated notes (TSDI) and
perpetual deeply subordinated notes (TSS).
7. Changes are pro-forma i.e. restated from the scope impact of AXA
Mexico, Genesys in Australia, QF Vita in Italy and SBJ in the UK, the
Forex and the reclassification of deferred expenses/loadings in France.
Full details are provided in the activity report's sections related to
these countries.
8. Corresponds to annualized administrative and acquisition expenses
excluding DAC impacts divided by total reserves (General Account,
Unit-Linked and UK with profit) at closing date.
9. Net technical reserves / Net earned premiums
10. Net of financial charges
11. Change is calculated using expenses net of inter company eliminations.
About AXA
AXA Group is a worldwide leader in Financial Protection. AXA's operations are diverse geographically, with major operations in Europe, North America and the Asia/Pacific area. For 1H09, IFRS revenues amounted to Euro 48.4 billion and IFRS underlying earnings to Euro 2.1 billion. AXA had Euro 967 billion in assets under management as of June 30, 2009.
The AXA ordinary share is listed on compartment A of Euronext Paris under the ticker symbol CS (ISIN FR0000120628 - Bloomberg: CS FP - Reuters: AXAF.PA). The American Depository Share is also listed on the NYSE under the ticker symbol AXA.
This press release is available on the AXA Group website: http://www.axa.com/
IMPORTANT LEGAL INFORMATION AND CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING STATEMENTS
Certain statements contained herein are forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties. Please refer to AXA's Annual Report on Form 20-F and AXA's Document de Reference for the year ended December 31, 2008, for a description of certain important factors, risks and uncertainties that may affect AXA's business. In particular, please refer to the section "Special Note Regarding Forward-Looking Statements" in AXA's Annual Report on Form 20-F. AXA undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise.
APPENDIX 1: AXA Group IFRS revenues - 1H09 vs. 1H08
AXA Group IFRS revenues - contributions & growth by segment and
country/region
IFRS revenues
Change
---------------
1H08 1H09 Comp.
In Euro million IFRS IFRS Reported basis
--------------- ---- ---- ---------------
United States 6,732 5,584 -17.1% -27.7%
France 7,441 8,024 +7.8% +7.8%
NORCEE 8,089 7,762 -4.0% -6.3%
of which Germany 2,955 3,055 +3.4% +3.4%
of which Switzerland 3,274 3,395 +3.7% -2.8%
of which Belgium 1,600 1,047 -34.5% -34.5%
of which Central
& Eastern Europe 229 228 -0.5% +10.8%
United Kingdom 1,900 1,292 -32.0% -22.8%
Asia Pacific 3,822 4,398 +15.1% -3.2%
of which Japan 2,354 2,909 +23.6% -5.2%
of which
Australia/New-Zealand 801 813 +1.4% +9.2%
of which Hong Kong 533 607 +13.9% -1.3%
of which South
East Asia 134 70 -47.8% -49.2%
MedLA 2,788 2,949 +5.8% +1.2%
Other countries 55 56 +2.1% +6.5%
--------------- -- -- ---- -----
Life & Savings 30,826 30,065 -2.5% -7.5%
-------------- ------ ------ ---- -----
NORCEE 5,224 5,394 +3.3% +1.0%
of which Germany 2,199 2,206 +0.3% +0.3%
of which Belgium 1,155 1,160 +0.5% +0.5%
of which Switzerland 1,805 1,957 +8.4% +1.6%
France 3,021 3,088 +2.2% +2.2%
Mediterranean Region 2,984 3,402 +14.0% -1.3%
United Kingdom & Ireland 2,389 2,048 -14.2% -2.0%
Canada 527 569 +8.0% +12.7%
Asia 375 417 +11.1% +8.3%
---- --- --- ------ -----
Property & Casualty 14,519 14,919 +2.8% +0.8%
------------------- ------ ------ ---- -----
AXA Corporate Solutions
Assurance 1,220 1,256 +2.9% +2.9%
Others 452 475 +5.1% +2.1%
------ --- --- ---- -----
International
Insurance 1,673 1,731 +3.5% +2.7%
------------- ----- ----- ---- -----
AllianceBernstein 1,340 924 -31.0% -39.8%
AXA Investment
Managers 763 579 -24.1% -23.9%
----------------- --- --- ------ -----
Asset Management 2,102 1,503 -28.5% -34.0%
---------------- ----- ----- ------ -----
Banking 197 195 -0.7% +1.0%
------- --- --- ---- -----
Total 49,319 48,414 -1.8% -5.7%
----- ------ ------ ---- -----
APPENDIX 2: Life & Savings - Breakdown of APE between unit-linked
non unit-linked and mutual funds
Breakdown of APE - 12 main countries, regions and modelled businesses
% UL in
APE (excl.
1H09 APE mutual funds)
------------------- -------------
UL change on
Non- Mutual comparable
In Euro Million UL UL Funds 1H08 1H09 basis
----------------- -- -- ----- ---- ---- -----
France 87 690 15% 11% -17%
United States 357 101 118 82% 78% -39%
United Kingdom 430 60 4 90% 88% -20%
NORCEE
Germany 65 153 40% 30% -31%
Switzerland 15 156 0 5% 9% +40%
Belgium 6 100 9% 5% -57%
Central & Eastern Europe 41 19 8 60% 68% +5%
ASIA PACIFIC
Japan 62 191 19% 25% +1%
Australia/New-Zealand 4 28 96 23% 13% -328%
Hong Kong 21 39 0 50% 35% -34%
South East Asia & China 20 16 2 66% 55% -22%
MedLA 37 177 5 18% 17% -53%
----- ----- ----- --- -- -- ---
Total 1,144 1,731 234 48% 40% -27%
----- ----- ----- --- -- -- ---
APPENDIX 3: AXA Group IFRS Revenues in local currency - Discrete quarters
(In million local currency
except Japan in billion) 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09
-------------------------- ---- ---- ---- ---- ---- ----
Life & Savings
United States 5,157 5,149 5,149 4,774 4,197 3,257
France 3,976 3,465 3,215 3,615 4,012 4,012
NORCEE
of which Germany 1,477 1,478 1,468 1,810 1,516 1,540
of which Switzerland 4,342 915 843 1,010 4,188 922
of which Belgium 989 611 419 541 534 514
of which Central & Eastern
Europe 113 116 121 115 115 113
United Kingdom 708 765 680 676 556 599
Asia Pacific
of which Japan 185 193 207 163 174 188
of which Australia/New-Zealand 701 625 748 924 918 607
of which Hong Kong 3,212 3,145 3,393 3,146 3,178 3,099
MedLA 1,291 1,497 920 1,104 1,417 1,532
----- ----- ----- --- ----- ----- -----
Property & Casualty
NORCEE
of which Germany 1,602 597 709 621 1,619 587
of which Switzerland 2,643 256 159 142 2,686 260
of which Belgium 637 517 507 477 648 513
France 1,821 1,200 1,362 1,212 1,864 1,224
MedLA 1,547 1,436 1,215 2,215 1,725 1,678
United Kingdom & Ireland 873 979 901 770 881 952
Asia 200 176 187 185 212 205
Canada 349 463 437 423 385 530
------ --- --- --- --- --- ---
International Insurance
AXA Corporate Solutions
Assurance 889 331 354 379 900 355
Others 247 205 203 233 279 196
------ --- --- --- --- --- ---
Asset Management
AllianceBernstein 1,045 1,006 931 711 610 624
AXA Investment Managers 374 388 337 337 295 284
----------------------- --- --- --- --- --- ---
Banking & Holdings 88 89 82 112 78 89
------------------ -- -- -- --- -- --
APPENDIX 4: 1H09 Property & Casualty revenues contribution & growth by
business line
Property & Casualty revenues - contribution & growth by business line
Personal Commercial
Personal Motor Non-Motor Commercial Motor Non-Motor
-------------- -------------- -------------- --------------
Change Change Change Change
on on on on
% Gross comp. % Gross comp. % Gross comp. % Gross comp.
In % renenues basis revenues basis revenues basis revenues basis
---- -------- ----- -------- ----- -------- ----- -------- -----
France 32% +3.3% 28% +3.8% 8% -3.1% 32% +1.2%
United
Kingdom (a) 18% +19.1% 35% -6.8% 6% -7.5% 40% -3.0%
NORCEE
Of which
Germany 32% -3.3% 30% -0.7% 6% +1.1% 25% +0.1%
Of which
Belgium 34% +0.1% 28% +3.3% 7% +1.7% 32% +0.6%
Of which
Switzerland 38% -1.0% 12% +3.1% 4% +1.3% 46% +2.5%
MedLA 44% -3.9% 19% +2.4% 10% +0.1% 27% +0.1%
Canada 39% +20.9% 19% +25.9% 7% +2.2% 38% -3.1%
Asia 75% +7.7% 7% +3.6% 4% +31.0% 18% +3.0%
----- -- ---- -- ---- - ---- -- ----
Total 35% +1.4% 24% +0.6% 7% -0.8% 33% +0.1%
----- -- ---- -- ---- - ---- -- ----
(a) Including Ireland.
APPENDIX 5: Life & Savings New Business Volume (APE), Value (NBV) and NBV
to APE margin
APE, NBV & NBV margin - 12 main countries, regions and modelled businesses
Change Change Change
on a on a 1H09 on a
compar- compar- NBV/ compar-
1H08 1H09 able 1H08 1H09 able APE able
In Euro million APE APE basis NBV NBV basis margin basis
United States 808 576 -37.8% 40 16 -64.4% 2.8% -2.1pts
France 690 776 +12.5% 36 36 -0.8% 4.6% -0.6pt
United Kingdom 692 493 -17.7% 69 48 -19.4% 9.7% -0.2pt
NORCEE 660 562 -16.0% 132 102 -24.2% 18.2% -2.0pts
Germany 236 218 -10.5% 44 31 -31.0% 14.4% -4.3pts
Switzerland 193 170 -17.2% 58 47 -24.4% 27.4% -2.6pts
Belgium 154 106 -31.2% 16 11 -34.9% 10.0% -0.6pt
Central & Eastern +1.7pts
Europe 76 68 -0.6% 14 14 +8.4% 19.9%
ASIA PACIFIC 558 483 -24.8% 201 196 -20.3% 40.6% +2.2pts
Japan 253 254 -23.0% 136 134 -24.1% 52.7% -0.7pt
Australia/New-Zealand 212 129 -36.0% 17 13 -19.6% 9.7% +2.1pts
Hong Kong 56 60 -6.8% 37 38 -10.9% 62.4% -2.9pts
South East Asia & China 36 40 -2.4% 11 12 -8.1% 30.4% -1.9pts
MedLA 204 219 -4.0% 27 29 +2.3% 13.4% +0.8pt
----- ----- ----- ----- --- --- ----- ---- ------
TOTAL 3,611 3,111 -16.3% 505 427 -22.0% 13.7% -0.9pt
----- ----- ----- ----- --- --- ----- ---- ------
APPENDIX 6: Earnings summary after taxes and minority interests /
Goodwill
Consolidated Net Income and
Earnings income from dis- Inte- related
(in Euro Group continued gration intan- Exceptional
million) Share operations costs gibles operations
------------ ---------- --------- --------- --------- ----------
1H08 1H09 1H08 1H09 1H08 1H09 1H08 1H09 1H08 1H09
---------------------------------------------------
Life & Savings 1,007 364 - (4) (13) (6) (12) (10) 1 (24)
-------------- --- --- - --- --- --- --- --- - ---
France 596 213 - - - - - -
United States 297 (131) - - - (2) (1) 1
United Kingdom 113 (43) - (2) (2) (1) (6) (6) -
Japan (28) 7 - (2) (2) - - -
Germany 43 (30) - (1) (2) - - - (7)
Switzerland (24) 46 - (2) - (2) (3) - (3)
Belgium (85) 213 - (4) (2) (1) - -
Mediterranean
Region 39 59 - (2) - (0) - -
Other countries 56 30 - (2) - - (1) (1) - (14)
of which Australia/
New Zealand (12) (23) - (2) - - - - -
of which Hong Kong 60 62 - - - - - -
------------------ -- -- - - - - - -
Property &
Casualty 1,028 722 - (24) (18) (27) (32) 2 (12)
--------- --- --- - --- --- --- --- - ---
France 184 168 - - - - - (4)
United Kingdom
& Ireland 105 5 - - - (10) (3) -
Germany 194 127 - (6) (10) - - - (12)
Belgium 161 92 - (9) (5) (0) (1) -
MedLA 266 170 - (5) (3) (3) (12) 6
Switzerland 67 90 - (4) - (10) (12) - (1)
Other countries 51 71 - - - (4) (4) -
--------------- -- -- - - - --- --- -
International
Insurance 155 117 - - - - - -
------------- --- --- - - - - - -
AXA Corporate
Solutions
Assurance 25 46 - - - - - -
Other 130 71 - - - - - -
----- --- -- - - - - - -
Asset
Management 198 187 - (1) - (4) - 10 (5)
---------- --- --- - --- - --- - -- ---
AllianceBernstein 122 95 - - - (4) - 10 (5)
AXA Investment
Managers 76 92 - (1) - - - -
-------------- -- -- - --- - - - -
Banking 11 (3) - (3) (1) (0) - -
------- -- --- - --- --- --- - -
Holdings & other (238) (63) - - - - - - 10
---------------- --- --- - - - - - - --
TOTAL 2,162 1,323 - (4) (41) (26) (43) (42) 13 (6)
----- --- --- - --- --- --- --- --- -- ---
Profit or loss
(including
change) on
financial
Consolidated assets (under Net realized
Earnings Fair Value capital gains
(in Euro option) & Adjusted attributable to Underlying
million) derivatives Earnings shareholders Earnings
------------ ----------- ---------- ------------ ------------
1H08 1H09 1H08 1H09 1H08 1H09 1H08 1H09
------------------------------------------------
Life & Savings (469) (646) 1,501 1,054 105 (178) 1,396 1,232
-------------- ---- --- --- --- --- --- --- ---
France (114) (10) 710 223 279 (42) 431 264
United States (8) (418) 306 287 (20) 16 326 271
United Kingdom 44 (122) 76 88 (16) (45) 92 133
Japan (183) (170) 157 178 24 10 132 168
Germany (9) 6 53 (28) (14) (58) 67 29
Switzerland (49) (17) 30 68 (63) (15) 93 84
Belgium (133) 100 52 115 (32) (9) 84 124
Mediterranean
Region (11) 6 53 53 10 (10) 43 64
Other countries (6) (23) 63 69 (65) (25) 128 95
of which Australia/
New Zealand (3) (16) (9) (5) (57) (18) 48 13
of which Hong Kong (1) (9) 61 71 (2) (5) 64 76
------------------ -- --- -- -- --- --- -- --
Property & Casualty (192) (15) 1,269 775 136 (210) 1,133 986
------------------- ---- --- --- --- --- --- --- ---
France (91) (27) 278 195 24 (35) 254 230
United Kingdom &
Ireland (4) 1 118 6 (55) (80) 174 87
Germany (45) (18) 244 143 72 (23) 173 166
Belgium (22) 21 194 77 86 (16) 107 93
MedLA (12) 5 281 179 38 (38) 243 217
Switzerland (17) (1) 99 104 (32) (19) 131 123
Other countries 0 4 55 71 3 1 52 70
--------------- - - -- -- - - -- --
International
Insurance (24) (10) 179 17 7 5 172 122
------------- --- --- --- -- - - --- ---
AXA Corporate
Solutions
Assurance (23) (10) 48 56 2 9 46 48
Other (1) - 131 71 6 (4) 126 75
----- -- - --- -- - --- --- --
Asset Management (93) 16 285 176 - 0 285 176
---------------- ---- -- --- --- - - --- ---
AllianceBernstein (12) 5 128 95 - 0 128 95
AXA Investment
Managers (81) 11 158 81 - 0 158 81
-------------- ---- -- --- -- - - --- --
Banking (4) (10) 19 8 (5) (7) 24 15
------- -- --- -- - --- --- -- --
Holdings & other (275) 331 37 (404) 282 11 (245) (415)
---------------- ---- --- -- --- --- -- --- ---
TOTAL (1,057) (335) 3,290 1,736 524 (379) 2,766 2,116
----- ------ --- --- --- --- --- --- ---
Consolidated Earnings
(in Euro million) Underlying Earnings
---------------- ----------------------
Change at
constant
Change FX
------ ----------
Life & Savings (12%) (16%)
-------------- ---- ----
France (39%) (39%)
United States (17%) (28%)
United Kingdom 44% 67%
Japan 27% (2%)
Germany (56%) (56%)
Switzerland (10%) (16%)
Belgium 48% 48%
Mediterranean Region 48% 50%
Other countries (26%) (32%)
of which Australia/New
Zealand (72%) (69%)
of which Hong Kong 19% 3%
------------------ --- --
Property & Casualty (13%) (12%)
------------------- ---- ----
France (10%) (10%)
United Kingdom & Ireland (50%) (46%)
Germany (4%) (4%)
Belgium (13%) (13%)
MedLA (10%) (10%)
Switzerland (6%) (12%)
Other countries 35% 45%
--------------- --- ----
International Insurance (29%) (30%)
----------------------- ---- ----
AXA Corporate
Solutions Assurance 3% 7%
Other (41%) (43%)
----- ---- ----
Asset Management (38%) (42%)
---------------- ---- ----
AllianceBernstein (26%) (35%)
AXA Investment Managers (49%) (47%)
----------------------- ---- ----
Banking (38%) (40%)
------- ---- ----
Holdings & other 69% 67%
---------------- --- ---
TOTAL (24%) (26%)
----- ---- ----
APPENDIX 7: AXA Group simplified Balance Sheet /
AXA Group Assets
In Euro billion FY08 1H09
Goodwill 17.0 17.0
VBI 4.4 4.2
DAC & equivalent 18.8 19.4
Other intangibles 3.2 3.1
Investments 526.7 534.3
Other assets & receivables 71.3 70.1
Cash & cash equivalents 32.2 26.6
------------ ----- -----
TOTAL ASSETS 673.6 674.7
------------ ----- -----
AXA Group Liabilities
In Euro billion FY08 1H09
Shareholders' Equity, Group share 37.4 38.8
Minority interests 3.1 3.4
------------------ --- ---
SH EQUITY & MINORITY INTERESTS 40.5 42.2
------------------------------ ---- ----
Technical reserves 517.5 530.6
Provisions for risks & charges 9.3 9.5
Financing debt 14.5 11.7
Other payables & liabilities 91.7 80.8
TOTAL LIABILITIES 673.6 674.7
----------------- ----- -----
APPENDIX 8: 2Q09 Main Press Releases /
-- 04/08/2009 AXA opens its first Campus in the Japan Asia-Pacific
region in Singapore
-- 04/30/2009 AXA Shareholders' Meeting - Approval of all resolutions
submitted to a vote of shareholders
-- 05/07/2009 1Q 2009 Activity Indicators
Please refer to the following web site address for further details:
http://www.axa.com/en/press/pr/
APPENDIX 9: 2Q09 operations on AXA shareholders' equity and debt /
Shareholders' Equity
No significant operations.
Debt
AXA issued in June 2009 a Euro 1.0 billion senior debt (Maturity 2015, 4.5% annual coupon, all-in issuance spread 146 bps over Euribor)
http://www.newscom.com/cgi-bin/prnh/20090805/NY57078-b
http://www.newscom.com/cgi-bin/prnh/20090805/NY57078-aDATASOURCE: AXA Group
CONTACT: Investors: Etienne Bouas-Laurent: +33.1.40.75.46.85,
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Winans: +1.212.314.55.19, all of AXA; AXA Individual shareholders Relations:
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Web Site: http://www.axa.com/