Consolidated results at 31.12.2011

20 March 2012 - 22:30 price sensitive

Consolidated results at 31 December 2011 (*)

Net profit at € 856 mln (€ 1.7 bln FY10). Result impacted by net € 1,017 mln of one-off impairments, related principally to Greek government bonds and Telco

Solid operating result at € 3.9 bln (€ 4.1 bln FY10). Strong growth in Non-Life result (+38.3%); Life result (-16%) reflects the lower financial margin

Solvency 1 at 117% at end of 2011. Ratio up to 132% at 1 March 2012, mainly due to the narrowing of spreads on Italian government securities

Per-share dividend at € 0.20 (€ 0.45 FY10)

Generali Group CEO Giovanni Perissinotto said: In a year marked by the worsening of the sovereign debt crisis, we confirmed our ability to achieve solid industrial results, while being a Group savers can consistently rely on. Our 2011 result was hit by one-off  impairments, principally related to Greek sovereign securities and to the stake in Telco, which will not be repeated in 2012. We are therefore targeting a strong growth in profit for this year.

Non-Life: Combined ratio improves by 2.3 p.p. to 96.5%, among the best in Europe

  • Operating result at € 1.6 bln, showing strong growth in Italy, France and CEE countries
  • Gross premiums increase to € 22.8 bln (+3.2%) with growth in all the main countries

Life: Solid operating result at € 2.5 bln; growth in technical margin (+3.8%) impacted by non-recurring impairments on Greek government bonds and Telco

  • Life net inflows up to € 5.8 bln, the highest in the European market. High new business margin (NBM) at 20.4%
  • Life premiums € 46.4 bln (-9.3%). Continued growth in annual premiums (+3.4%)

Financial segment: assets under management at € 424 bln. Third-party assets € 88 bln (+3.4%)

  • Segment operating result € 342 mln (€ 354 mln FY10). Positive contribution from BSI growth in Asia

Milan – At a meeting today chaired by Gabriele Galateri di Genola, the Board of Directors of Assicurazioni Generali approved the consolidated financial statements and the parent company preliminary financial statements for 2011.

In a year badly affected by the international economic crisis, the sovereign debt difficulties in a number of Eurozone countries and the sharp reduction in savings, Generali reported solid industrial results in both its Life and Non-Life businesses. The strong growth in the Non-Life operating result (+38.3%) and the improvement in the Life technical margin (+3.8%) enabled Generali to offset the impact of market trends on financial items in the Life business. The aggregate operating result was € 3,928 million, substantially in line with the previous year (€ 4,077 million FY10).

Net profit, at € 856 million (€ 1,702 million FY10; -49.7%), reflected the impact of a high volume of net non-recurring impairments on bonds and equities, for € 1,017 million. The Group has applied an average impairment of 76% to its entire portfolio of Greek debt instruments, based on financial market prices at 31 December 2011. It has also performed the impairment of its equity investment in Telco – the holding company (of which Generali has a 30.6% share) that controls 22.4% of Telecom Italia (**).

Group performance was accompanied by a strengthening in the capital structure in the early months of 2012, thanks in particular to the reduction in yields on Italian government securities. The Group’s solidity was also reflected in the improvement, at 1 March 2012, in the Solvency I ratio to 132% (117% FY11), a return to pre-crisis levels. Shareholders’ equity at the end of 2011 stood at € 15,486 million (€ 17,490 million FY10).

Looking at operating performance at the end of 2011, in the Non-Life sector strong growth was reported in both volumes and profit margins, with the operating result showing a sharp rise to € 1,561 million (+38.3%), thanks to the improvement of 2.3 percentage points in the combined ratio to 96.5%, one of the best in the European market. This excellent result was achieved through stable expenses, a prudent underwriting policy and efficiency improvements in claims settlement processes.

In Life, where the increase in annual premiums assisted the growth of the technical margin, the operating result (€ 2,542 million, -16%) was adversely affected by impairments, in particular on Greek government bonds and Telco. The business mix and prudent tariff policy enabled the Group to reach strong net inflows of € 5.8 billion, the highest among European insurers. New production margin (NBM) continues to be high at 20.4%.

In asset management, third-party assets under management increased by 3.4% on a like-for-like basis. The operating result in the financial segment was substantially steady at € 342 million (€ 354 million FY10), reflecting the competitiveness of the Group’s financial management products and the effectiveness of its distribution networks.


In occasion of the Annual General Meeting, the shareholders will be asked to approve a dividend per share for FY 2011 of € 0.20 (€ 0.45 in 2010). The total dividend on outstanding shares amounts to € 310.6 million with a 36.4% pay-out. The dividend will be paid from 24 May and shares will trade ex dividend as from 21 May 2012.


The investment policy was based on prudent asset allocation. In the Eurozone in particular, the goal is to eliminate cross-border exposure by ensuring that investments in bonds of a specific country cover liabilities in the same area. Exposure in non-financials corporate instruments remained stable, but with shortened durations. In the fourth quarter, the Group took the precautionary step of increasing portfolio liquidity in order to better capture investment opportunities in light of the particular situation in financial markets at the end of the year. In the Non-Life segment, the focus will continue to be on re-allocation of risk capital from financial to insurance risks, with a view to improving the operating result by raising returns on invested capital.

Own investments 31/12/2011 31/12/2010
Fixed-income instruments 77.6% 80%
Cash and cash equivalents 7.9% 3.9%
Equities 5.5% 7.5%
Real Estate 4.9% 4.8%
Other 4% 3.8%
Total own investments € 311 bln € 312 bln


In the Life business the Group expects to confirm 2011 premium levels, although new business will give priority to products with lower capital absorption and higher value, thus maintaining technical margins. In the Non-Life segment, the Group expects to confirm its premium growth rates deriving from the trends of both Non Motor and Motor businesses. Assuming a normal level of catastrophic events, an additional improvement in overall technical margins is expected through the maintenance of current operating efficiency levels, and the persisting effects of tariff policies and claims management policies, implemented by the Group.
The investment policy will continue to be based on prudent asset allocation aimed at consolidating current margins and reducing capital absorption. The Group will also continue its portfolio de-risking strategy. In the Non-Life business, as noted above, the focus will be on the re-allocation of risk capital from financial to insurance risks, in order to improve the operating result by raising returns on invested capital.
The Group expects a reduction of the significant level of non-recurring components that affected results in 2011, with an improvement in both Life and Non-Life operating results and in Group net profit.


Life gross premiums amounted to € 46,394 million (-9.3%) due to the performance in single premiums, which were affected by the offer of short-term, high-yield financial products from banks. Healthy performance was reported in the more profitable area of annual premiums (+3.4%), thanks to the strength of the distribution network based on proprietary channels.

New business in terms of APE totalled € 4,787 million (-9%; € 5,333 million FY10) despite the fall in single premiums (-24.8%). New annual-premium business improved (+2.7%), especially in Italy (+7.7%).

The Life business was notable due to the high quality of new business – new business value (NBV) stood at € 976 million, with good results in all the main Group markets. New business margins (NBM) rose to 20.4%, particularly thanks to growth in annual premiums.

Life segment
€ mln        Premiums APE NBM
  31/12/2011 Δ 31/12/2011 Δ 31/12/2011 Δ
Italy 12,711 -7.9% 1,715 -2.9% 21.8% +3.4 p.p.
France 9,007 -20.9% 939 -19.8% 13.7% +1.2 p.p.
Germany 13,534 -1.6% 908 -7% 18.3% +0.6 p.p.
CEE 1,678 -6.2% 147 -8.9% 35.8% +3.5 p.p.
Total 46,394 -9.3% 4,787 -9% 20.4% +0.7 p.p.

Looking at the individual Group markets, Italy reported the best result in new business value (NBV) at € 374 million, and new business margins (NBM) at 21.8%. Life business margins were also high in Germany (18.3%) and Central East European countries (35.8%).

As a result of the positive performance in Life net inflows, Life net technical reserves improved by 1% to € 316,564 million (€ 313,348 million FY10).


The strong growth in production and high technical margins were the key drivers of performance in the Non-Life segment, which closed in 2011 with an improvement of 38.3% in the operating result, to € 1,561 million (€ 1,128 million FY10). Significant growth was achieved in Italy (+94.4%), France (+69.1%), Spain (+32%) and Central Eastern Europe (+30.9%).

The combined ratio improved by 2.3 percentage points to 96.5% (98.8% FY10), particularly supported by the reduction in the loss ratio from 71.3% at the end of 2010 to 69%. The 2.3 p.p. reduction in the loss ratio was particularly attributable to the 1.7 p.p. improvement in the current loss ratio, which excludes the impact of catastrophic events. Despite the rise in premiums, the expense ratio was stable at 27.6% (27.5% FY10).

Non-Life segment
€ mln Premiums Combined Ratio
  31/12/2011 Δ 31/12/2011 Δ
Italy 7,501 +0.8% 96.8% -2.8 p.p.
France 4,057 +4.2% 98.7% -2.6 p.p.
Germany 3,062 +2.2% 94.4% -0.8 p.p.
CEE 2,261 +1.3% 89.5% -3.7 p.p.
Total 22,765 +3.2% 96.5% -2.3 p.p.

The net reserve ratio (total net reserves / net retained premiums) was 146.2% (148.8% FY10), confirming the Group’s prudent reserving policy.


In the Asset Management business total assets under management were € 424,433 million (€ 432,043 million FY10), with third-party assets at € 88,207 million (+3.4% on a like-for-like basis).

The operating result in the Financial Services segment was € 342 million (€ 354 million FY10). The trend (-3.3%) was particularly affected by the decrease in net commissions, reflecting trends on the financial markets. The net result on financial operations improved, thanks specifically to the increase in the intermediation margin.


Global Added Value (GAV), which reflects wealth generated by Group operations in the year for the various stakeholder categories, reached € 12.7 billion. Amounts increased for employees, agents and, in particular, the community (+7.9%).

Distribution of Global Added Value
€ mln 31/12/2011 31/12/2010 Δ
Group 546 1,003 -45.6%
Shareholders 607 1,015 -40.2%
Employees 4,265 4,144 +2.9%
Agents and advisors 5,366 5,318 +0.9%
State 652 869 -25%
Lenders 1,253 1,237 +1.3%
Community 49 46 +7.9%
Global Added Value 12,737 13,633 -6.6%

The Board of Directors has called an ordinary and an extraordinary session of the Shareholders' Meeting for 23, 26 and 28 April 2012. At the ordinary session, the shareholders will be asked to deliberate on the approval of the separate financial statements as at and for the year to 31 December 2011 and the distribution of the dividend, as well as on the appointment of a member of the Board of Directors (due to the technical expiry of Mr Galateri’s term of office as a member of the Generali board) and on the remuneration policy included in the related annual report. At the extraordinary session, the shareholders will be asked to deliberate on amendments to the by-laws for the purpose of introducing the so-called gender quotas in the composition of the Board of Directors and the Board of Statutory Auditors, in compliance with the laws approved recently; to make the appointment of the General Council non-compulsory; to establish age limits for membership of the Board of Directors, and for the posts of Chairman and Chief Executive Officer. The reports of the Board of Directors to the Shareholders' Meeting will be published on the company website ( within the legally prescribed terms.
The Board of Directors also approved the 2011 annual report on corporate governance and ownership and set the targets for the second cycle of the Long-Term Incentive Plan approved by the Shareholders' Meeting of 30 April 2011: the Plan information required by art. 84-bis, paragraph 5, of the Issuers Regulation will be available on the above-mentioned website, in the Governance section under the Documents heading, within the legally prescribed terms.

the Manager in charge of preparing the company’s financial reports, Mr Raffaele Agrusti, declares, pursuant to paragraph 2 article 154 bis of the Consolidated Law on Finance, that the accounting information in this press release corresponds to the document results, books and accounting entries.

 (*) Changes computed on a like-for-like basis
(**) This impairment was supported by an independent assessment, based on a Telecom Italia per-share implied value of 1.5 euro.