Ageas’ performance for the first quarter of the year is very positive. We believe the worst turmoils to be past (Turkey FX impact, COVID-19 claims and high volatility on the markets) and, coupled with the recovery in economies and strong capital generation, we see the rest of 2021 as looking better than expected.
Companies: Ageas (AGS:EBR)ageas SA/NV (AGS:BRU)
Ageas released net profit at €1,141m. The Non-Life business contributed significantly to this performance (up 49% to €391m), while the Life divisions suffered and posted a 32% drop to €569m. We appreciate the resilient top line and the €2.65 to be distributed per share. Ageas also announced the acquisition of a 40% stake in the Turkish Life insurance and pensions company AvivaSA for €142m. The insurer enters a new market, with rapid growth and without problems of low interest rates.
Despite the pandemic, Ageas was very active during 2020 to reinforce its positions in existing markets and to clean its balance sheet. There are no fears about the capacity of the insurer to generate cash and to distribute a dividend for 2020 earnings.
Companies: ageas SA/NV
Q2 20 net profit stood at €339m, -4% yoy. H1 earnings increased by 31% to €791m thanks to the FRESH operation in Q1 (€332m). Pressures continued on the Life business (-36% in net result to €309m), contrary to Non-Life’s earnings (+56% to €181m) thanks to lower claims in Motor and Accident & Health segments. The Solvency II ratio was 192%. The insurer announced the distribution of an interim dividend of €2.38/share. Resilient performance from the Belgian company.
The solid net profit (€452m, up 80% yoy) was the result of the operation on FRESH securities. The pandemic hit the insurance result, which dropped by 56% to €113m. The operating margin in the Life business declined and the high combined ratio (99.7%) resulted from bad weather conditions. The resilient Solvency II ratio (193% on 30 April) sustains the intention of management to distribute an intermediary dividend of €2.38/share later in 2020, to reach the initially announced dividend of €2.65/sha
Ageas reported a FY 19 net income of €979m, up 21% yoy. The Q4 was difficult with a 34% drop in the net result to €102m. Earnings were driven by Life operations (up 65% yoy to €841m). By market, Belgium and Asia contributed up to 96% of the group’s net result. The Solvency II ratio stood at 217.3%, but it does not include the impact of the transaction on Fresh securities (-12%). The proposed dividend exceeded estimates at €2.65/share.
Ageas posted a 4% increase in 9M inflows to €11,680m. The growth of the top line was driven by Non-Life business (+7% to €3,453m in 9M), while the Life operations were behind the better net result (+44% to €667m in 9M). Asia and Belgium were the main contributors to the group’s profits (>85%). The Solvency II ratio stood at 199%. The results were slightly better than expected, but we prefer to remain cautious given the possible adverse weather conditions in Q4.
Ageas posted an 4.4% increase in its inflows to €21,018m thanks to both the Life and Non-Life branches. The net result was up 37.3% to €354m, driven by an excellent Q2 for the Life business which recovered after a difficult Q1 19. The General Account released a positive result (€5m). The Solvency II ratio stood at c. 201%. We will be revising up our estimates for the full year.
Ageas posted an 8% increase in its inflows to €12,808m, driven by both the Life and Non-Life businesses. The net result was up 1.2% to €251m, saved by lower losses from the General Account (€-7m vs. €-52m in Q1 18). While the decrease in the Non-Life business was expected, as it is under transformation, the Life earnings were hit by timing differences on capital gains. The Solvency II ratio stood at 194%. Released figures are broadly in line with estimates.
Ageas reported a net income of €809m, 2% lower than our estimates. Q4 was difficult with a 52% drop in the net result to €133m. The poor performance of the equity markets during Q4 affected the Life result (-70% to €45m). The Non-Life division also suffered (-29% to €88m). The Solvency ratio stood at 214% and the proposed dividend met our estimates at €2.20/share. We will keep our positive trend in the insurer’s future operating performances.
Ageas posted a 1% increase in 9M inflows to €27,387m. Life sales recovered (+2% to €22,849m). However, the operating result dropped by 11% to €420m. Non-Life sales continued their downward trend. The Q3 operating earnings rose but it was not enough to offset the ytd losses (-15% tp €259m). The 9M 18 net result amounted to €655m. The insurer announced the acquisition of 40% of the Indian RSGI for €186m. The results agreed with our estimates. No major changes are expected.
Ageas posted a 2% decrease in inflows to €20,128m (+1% increase lfl). A strong recovery was observed in Life sales and the ytd decrease was reduced to 1% to €16,996m. However, the operating result dropped by 17% to €125m. Non-Life sales and operating earnings continued their downward trend. The capital position is solid and a new share buy-back programme for €200m was announced. The results agreed with our estimates. We will refine our model to include the excellent Asian performance.
According to Bloomberg, Fosun International is considering an offer for all or parts of Belgian insurer Ageas. The Chinese conglomerate is talking to advisers about alternatives including teaming up with a partner to split the Belgian company or increase its current stake of 3.01%. No final decisions have been made.
Ageas posted a 6% decrease in its inflows to €11,852m, but this includes a 4% negative currency impact. The decline concerned both Life and Non-Life business, down 7% to €10,149m and 3% to €1,703m, respectively. The insurance results were up 35% to €299m, supported by the exceptional results in China. We expect a lower Asian contribution to earnings in Q2 18. The Solvency II ratio stood at 195%. These released figures are better than expected and we will raise our estimates.
With a lower than expected net profit (€623m released vs. €683m expected), Ageas’ performance was not exceptionally good. However, with the highest regular dividend since 2007 (€2.1/share), the insurer surprised us. The strong capital position of the Belgian company encouraged management to increase its payout ratio. Concerns about the Fortis Affair are behind and the focus is now on the compensation models of claimant organisations. No major changes are expected in the insurer’s future operatin
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What’s new: Updates in April and early May reveal:
Group consolidated Funds Under Management “FuM” of US$11.3bn at the end of April 2021 is up 4.0% year to date (Dec20: US$10.9bn).
Strong investment performance across CLIG’s investment strategies, was offset by clients rebalancing, resulting in 3Q net outflow of US$278m.
CLIG continues to maintain an active pipeline across all its major products.
Income net of third-party commissions currently accrues at circa 74 bps (i.e. c. 73 bps
Companies: City of London Investment Group PLC
As midsummer’s day looms (where has this year gone?), there is greater optimism, in general, than may have been anticipated a few months ago. A post-pandemic, ‘vaccine-driven’ recovery demonstrated by increased consumer spending as lockdown measures are lifted has been one of the catalysts. The FTSE 100 has been range-bound in the last month 6,900-7,100. We have seen a combination of broadly positive company results across a range of sectors, further examples of M&A activity and a sequence of ne
Companies: AMYT ARBB ARW BAG BEG BONH BWNG CWK DNK EML EPWN FBD FA/ GPH GSF GNC HUW IGC INSE KAPE KP2 MMAG NRR NESF OTMP ROL RUA SEN SUR TON TOU TXP TGL VLS WINK
Forecast beating Final Results
Companies: Palace Capital plc
Avation is a lessor of 45 aircraft to a diversified airline client base of 19 commercial airlines across 15 countries. This morning, the group has provided a solid trading update to 31 March 2021, which points to a continued focus on managing the collection of customer revenue, with rent collections and overall cashflow having improved since the end of H1 2021. The remarketing of the eight returned ATR aircraft has also continued, while net debt reduced by $51.6m in Q3 FY 2021E to $988.1m, with
Companies: Avation PLC
HgCapital Trust (HGT) posted a strong NAV TR of 8.4% in Q121, driven primarily by double-digit earnings growth across the portfolio (LTM EBITDA for top 20 holdings up 30% y-o-y). After record-high transaction volumes in FY20 (investments at £403m and realisations at £364m), HGT has maintained a high transaction activity to date in 2021 (£147m and £112m, respectively). Its coverage ratio was a healthy 69% at 12 May 2021, supported by tap equity issues, which totalled c £50m to 8 June 2021 (versus
Companies: Hgcapital Trust
Trident reports that Moxico Resources Plc has recently completed a US$73m equity financing. The proceeds will be used to fast-track development of the Mimbula copper mine in Zambia over which Trident holds a royalty. Mimbula is already producing copper and is in the ramp up stage, but the cash injection will allow Moxico to produce cathode copper onsite via the construction of a new SX-EW plant and Moxico anticipates a significant increase in copper production. As a royalty holder, Trident will
Companies: Trident Royalties Plc
Hipgnosis Songs Fund (SONG LN) has today released a trading update and published an unaudited NAV of $1.6829 (122.5p) as at 31 March 2021 vs $1.5114 (116.7p) as at 31 March 2020. This is an increase of 11.3% (in US$ terms – to which the company changed its reporting currency back in October 2020), and a TR of 15.7%, giving a TR of 40.7% since inception in July 2018. The growth in the “Operative NAV” is 9.4% on like-for-like uplift in fair value catalogues which has been driven various factors: t
Companies: Hipgnosis Songs Fund Limited Shs GBP
Liontrust has delivered exceptional growth and there is much to be optimistic about, yet it continues to trade on an unexceptional 14x Mar-22e PER. We are expecting no surprises at Finals later this month after a post-period update in late May and supportive markets since. There is opportunity across the fund range (including the established Sustainable strategy) with continuing growth from flows and performance, and potential in recent acquisitions; set against compelling market dynamics. Liont
Companies: Liontrust Asset Management PLC
Today's news & views, plus announcements from SSPG, PNL, SHED, TUNG, ANX, BLTG, AVAP
AVO’s goal is to deliver an affordable and novel PT system, called LIGHT, based on state-of-the-art technology developed originally at the world-renowned CERN. Over the past two years, important technical milestones have significantly derisked the project. Now, AVO is working on the verification and validation phase, prior to LIGHT being used on the first patients to support CE marking. In its recent technical update, the company highlighted progress made over the past three months towards a ful
Companies: AVO ARBB ARIX BBGI CLIG DNL FLTA ICGT OCI PCA PIN RECI STX SPO SCE TRX VTA
OCI hosted its annual Capital Markets (CM) day on 18 May 2021.With presentations from Oakley Capital and investee companies, as well as Q&A, including the OCI board, it gave a clear view of the prospects of the organisation. We have argued in previous notes that OCI’s outperformance (five-year CAGR NAV total return 16%) is driven by i) high-growth companies and sector champions enjoying structural tailwinds and often digital disruption benefits (2020 average 20% EBITDA growth), ii) repeatable an
Companies: Oakley Capital Investments
Finsbury Growth & Income Trust (FGT) is managed by Nick Train, one of the founding partners of boutique investment firm Lindsell Train. He is optimistic on the current outlook for UK equities, all the more so given several years of relative underperformance; in particular, the manager believes that global investors are underestimating the level of technological innovation within the UK corporate sector. While FGT’s relative performance has lagged that of its peers and the UK market in recent mon
Companies: Finsbury Growth & Income Trust PLC
Urban Logistics REIT (“ULR”) has delivered a watershed year: doubling the portfolio with a disciplined approach focusing on value-add opportunity through reversion and regear. Finals show rental income doubling from acquired assets, with recurring EPS in line with our forecast. EPRA NAV was 6% ahead of N+1Se, as valuation yields tightened. The manager has secured a further c.£150m pipeline of similarly attractive assets. We make a modest upgrade to EPRA NAV on better valuation. We see sustained
Companies: Urban Logistics REIT plc
Trident Royalties Plc (AIM: TRR) has, this morning, noted progress at the Mimbula Copper Project, over which Trident holds a gross revenue royalty (GRR). Mimbula's owner and operator, Moxico Resources Plc, recently completed a US$73million equity financing which will be used to develop and build a standalone SX-EW plant. We have also updated our production assumptions for the Thacker Pass Lithium Royalty based on comments by Lithium Americas Corp. (NYSE/TSX:LAC) in their Q1 2021 results last mon
Belvoir has exchanged contracts to acquire The Nottingham Building Society’s mortgage services business for £0.6m in cash. In isolation this adds c.1% to our EPS forecasts in a full year but we believe it could pave the way for Belvoir to significantly increase its Financial Services sales as it provides direct access to a substantial source of clients with savings and a high likelihood of needing a mortgage for the first time (50,000 18-39 year old Lifetime ISA savers). We will look to reflect
Companies: Belvoir Group PLC