French insurance and investment giant AXA saw its net income in 2019 jump 75% to €3.9 billion, with growth seen across all lines of business and geographies.
This considerable jump in net income was mainly driven by a goodwill impairment of €3 billion related to Equitable Holdings in 2018.
Underlying earnings increased by 2% to €6.5 billion, which AXA says reflects continued positive operational performances from France (+9%), International (+17%), Asia (+3%) and Europe (+1%).
Property & Casualty combined ratio (CR) was 96.4%, improving by 0.6 point, mainly due to an improved claims experience and more favorable prior-year reserve developments.
Protection CR improved by 0.7 point to 93.2%, reflecting the positive impact of the Group Life transformation in Switzerland, partly offset by lower prior-year reserve developments.
Meanwhile, Health combined ratio was up by 0.1 point to 94.1%, as a less favorable claims experience was partly offset by an improvement in expense ratio.
Total revenues increased in all business lines, totaling €103.5 billion for the full-year, against €102.9 billion in 2018.
“AXA recorded another strong operational performance in 2019”, said Thomas Buberl, Chief Executive Officer of AXA. “Revenues were up 5% to Euro 104 billion, with growth across all lines of business and geographies.
“In 2019, the Group achieved a 5% increase in underlying earnings per share, with high technical profitability across all our businesses.Based on the strong operational performance and the strength of AXA’s balance sheet, the Board of Directors is proposing a dividend of Euro 1.43 per share, an increase of 7% from last year, which corresponds to a payout ratio of 52%.
“The Group achieved a significant milestone in 2019 in its strategy to shift its profile away from financial markets and towards technical risk, by fully exiting the US Life & Savings market and integrating the XL Group, and at the same time reducing its debt gearing ratio.”
AXA XL, who this morning announced the appointment of Scott Gunter as its new Chief Executive Officer, saw its Total revenues increase by 10% to €18.7 billion.
However, the unit’s full-year combined ratio was 101.5%.
Further steps have reportedly been taken to reduce earnings volatility at AXA XL in 2020, notably via reduced exposure to Property Catastrophe business, line-sizing in Casualty, as well as additional reinsurance covers.
Reinsurance revenues increased by 2% to €4.5 billion, mainly driven by higher volumes in Specialty lines, partly offset by selective underwriting in Property Cat.
P&C Insurance revenues were up 18% to €9.1 billion while Specialty Insurance revenues increased by 6% to €4.9 billion, notably in Political Risks, partly from revenue synergies.
Price increases on renewals for the year were 8.3% in Insurance and 3.0% in Reinsurance. The favorable pricing environment in AXA XL’s insurance business saw continued improvement with discrete fourth quarter renewals experiencing a 14% increase.
“At AXA XL, impacted again by adverse claims experience in 2019, we are recording strong price increases and taking further steps to reduce volatility,” added Buberl.
“I am also very happy to welcome Scott Gunter to the AXA Group to drive the next phase of development of AXA XL.
“AXA’s active leadership role in fighting climate change also continued, as a global investor, a global insurer, and as a coalition builder. In 2019, AXA doubled its green investments target, launched transition bonds as a new asset class, further strengthened its coal underwriting policy, established AXA Climate and joined the Net Zero Asset Owner Alliance.
“I would like to thank all our colleagues and partners who have been working together to deliver these results and transformative achievements, as well as our clients for their continued trust.”