Irrespective of the latest large losses, Talanx is very optimistic for profitabilisation in the fire line within the Industrial Lines Division. The changes already completed in management and the “20/20/20” programme are expected to lead to a balanced underwriting result in 2019 and to a positive underwriting result in the division from 2020. The “20/20/20” programme is directed towards reducing the combined ratio in the burdened 20 percent of the Industrial Lines portfolio to significantly less than 100 percent by 2020. By the middle of October, more than 60% of the rate increases were already under contract. All the other divisions, Retail Germany, Retail International and Reinsurance, are developing in line with expectations.
Talanx is now assuming a Group net income of around EUR 700 million for the year 2018 overall. The return on equity is correspondingly likely to be around 8 percent and therefore at the level of the target for minimum return on equity. This earnings forecast is based on the assumption of a large loss burden for the fourth quarter within the scope of a quarterly budget. From today’s perspective, a dividend payout for 2018 at least equal to the year-earlier level is assured.
Talanx is expecting Group net income amounting to around EUR 900 million for the coming financial year 2019 and this entails a higher profit than originally planned for 2018.
All forecasts assume that any large losses will be within the expected range and that there will be no disruptions on the currency and capital markets.
This news release contains forward-looking statements which are based on certain assumptions, expectations and opinions of the Talanx AG management. These statements are, therefore, subject to certain known or unknown risks and uncertainties. A variety of factors, many of which are beyond Talanx AG’s control, affect Talanx AG’s business activities, business strategy, results, performance and achievements. Should one or more of these factors or risks or uncertainties materialise, actual results, performance or achievements of Talanx AG may vary materially from those expressed or implied in the relevant forward-looking statement. Talanx AG does not guarantee that the assumptions underlying such forward-looking statements are free from errors nor does Talanx AG accept any responsibility for the actual occurrence of the forecasted developments. Talanx AG neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated.