Italian insurer Generali has reported an attributable profit of €1.67bn for 2014, down from €1.91bn the previous year, on net earned premiums of €64.3bn, up from €60.6bn in 2013. Gross written premiums rose to €70.4bn, from €65.9bn the previous year, "driven by the excellent performance of the life segment", where premium income rose by 11.12% to €49.8bn.
Generali said that the 2014 results marked as "early conclusion of Generali turnaround", with all targets delivered a year in advance. The deterioration in the group result was attributed to €400m of one-offs.
Group chief executive Mario Greco said: "Today, Generali is focused on its core insurance business, more disciplined in the management of its balance sheet and capital, and more simple and transparent in its geographic presence and governance".
GWP in property & casualty were flat at €20.62bn. Premiums from motor lines rose slightly, while there was a decrease in income from the markets most impacted by the current macro-economic environment (France, Italy, Spain, Czech Republic). This, said Generali, was more than offset by the increase observed in Germany and in emerging markets.
There was a 1.7% growth in Commercial, helped by a strong performance in Germany and International Operations. These were offset by a decline in Accident/Health and Personal lines.
The combined ratio improved by 1.9pp to 93.8%, helped by strong performances in all major markets. These included Italy (down 3.2pp to 89.2%), Germany (down 3.1pp to 92.6%) and International Operations (down 6.9pp to 83.8%. The one disappointment was Latin America, where the combined ratio rose 12.4pp to 113.3%.
The operating result improved to €4,508m, from €4,071m, but the group result was impacted by a lower result from discontinued operations. These fell to a loss of €69m, part of which was due to the effects of IFRS 5 application to the BSI disposal. This generated a negative impact of €112m.
The non-operating result improved to minus €1,464m, from minus €1,579m in 2013. Net impairment losses rose to minus €813m, from minus €623m. This was due to higher impairments on equity and property investments, and also from a stake in Russian insurer Ingosstrakh, totalling minus €249m.
Net realised gains rose to €874m, from €856m, despite a realised loss of €79m recorded through the repurchase of three hybrid bonds. A profit of €290m was booked arising to provisions relating to the participation in Banca d'Italia.
Generali announced an increase in its dividend to €0.60 a share, up from €0.45 a share last year.
Looking ahead the insurer said that these were "unprecedented times" for the insurance industry, with record low interest rates, increasingly stricter rules on distribution, the implementation of Solvency II at the start of 2016, and a softening non-life market. The company said that that for 2015 it expected to strengthen the levels of operating performance achieved in 2014.
Generali's share price was down 2.67% in mid-morning trade, at €18.56, having initially fallen to as low as €18.40.