Allianz SE, Europe’s biggest insurer, reported first-quarter operating profit that fell 2.9 percent, less than analysts estimated, and said it was maintaining its earnings target for the year.
Operating profit was €2.72 billion euros ($3.8 billion) compared with €2.8 billion [$3.9 billion] reported a year earlier, beating the €2.6 billion [$3.623 billion] average estimate of six analysts surveyed by Bloomberg. Net income declined to €1.64 billion [$2.285 billion] from €1.71 billion [$2.383 billion], the Munich-based insurer said in a statement.
“The first quarter came in strong like last year,” Chief Executive Officer Michael Diekmann said. “Both property and casualty insurance and life and health insurance exceeded their quarterly share of our full-year outlook, and asset management was in line with target.”
Allianz targets operating profit of €9.5 billion [$13.24 billion] to €10.5 billion [$14.63 billion] this year compared with €10.1 billion [$14.07 billion] reported for 2013.
The insurer’s shares declined 0.3 percent to €123.65 [$172.33] in Frankfurt trading, extending losses this year to 5.1 percent and valuing the company at €56.5 billion [$78.75 billion]. The Bloomberg Europe 500 Insurance Index gained 1.2 percent since Dec. 31.
The contract of Diekmann, 59, ends this year along with those of five other management board members. Allianz said in February it expects the supervisory board to make a decision on leadership in October.
Allianz’s property and casualty insurance unit combined ratio, typically the most important in terms of earnings, improved to 92.6 percent from 94.3 percent a year earlier.
Allianz’s asset management unit, which includes Newport Beach, California-based Pacific Investment Management Co., increased third-party assets under management to €1.34 billion [$1.867 billion] from €1.33 billion [$1.853 billion] at the beginning of the year. The rise was helped by “market value increases,” it said.
As lower interest rates continue to weigh on insurers’ investment returns, shareholders are focusing on the performance of asset management after the surprise resignation of Pimco Chief Executive Officer Mohamed El-Erian in January. El-Erian, who had shared the role of co-chief investment officer with Bill Gross, has continued to work for Allianz as chief economic adviser.
Allianz is scheduled to report full first-quarter earnings on May 14.