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Allianz fourth-quarter net profit up 19 percent, in line with expectations

Reuters with
Key Points
  • Allianz raised its 2019 operating profit target on Friday.
  • The German insurer also proposed a dividend of 9 euros per share, up from 8 euros.
The logo of German insurer Allianz stands on the company's office buildings at Treptowers in Berlin, Germany.
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German insurer Allianz said on Friday that net profit rose 19 percent in the fourth quarter from a year earlier, in line with expectations, and said it was aiming for a larger operating profit target in 2019.

Net profit attributable to shareholders of 1.697 billion euros ($1.92 billion) compared with the 1.715 billion euro profit forecast by analysts in a Reuters poll and was up from 1.427 billion euros a year earlier.

For 2018, Allianz earned 11.5 billion euros in operating profit, at the upper end of its targeted range of 11.1 billion euros, plus or minus 500 million euros. The insurer had already flagged that it was highly likely to come in above the midpoint of the range.

For 2019, Allianz said it is aiming for operating profit of 11.5 billion euros, plus or minus 500 million euros. 

Allianz has managed headwinds and achieved record results, CFO says

Speaking to CNBC's "Squawk Box Europe" on Friday, Allianz CFO Giulio Terzariol said: "In our performance in 2018 we have been very capable (of managing) headwinds to achieve record results on most of our KPIs."

He added that the bank expected the ECB to leave interest rates unadjusted.

"Because of the tension we might have – let's say Italy and Brexit – and because of the economy we would expect interest rates to stay relatively flat in Europe, which is not necessarily an issue for us because we've been in this situation for a few years," he said.

Allianz and the insurance sector are bouncing back from losses incurred by hurricanes, fires and earthquakes in North America in 2017 – the industry's costliest year ever.

Allianz's combined ratio in its property and casualty division, a key measure of profitability, was 94.1 percent in the fourth quarter, down 0.4 percentage point from a year earlier. Readings below 100 indicate profitability.

It proposed a dividend of 9 euros per share, above expectations of 8.84 euros per share and above 8 euros per share last year.

On Thursday, Allianz announced plans to buy back up to 1.5 billion euros in shares.

($1 = 0.8861 euros)