Please click here to access all 3Q 2022 results related
documents.
The Hague, November 10, 2022 - Maintaining high pace
in implementing Aegon’s strategy
- Net loss of EUR 206 million driven mainly by a non-economic
loss on interest rate hedges in the US
- Operating result of EUR 429 million, which is a decrease
of 11% on a constant currency basis compared with the third quarter
of 2021. Benefits from expense savings, growth initiatives, and an
improvement in claims experience are more than offset by lower fees
due to adverse markets
- The capital ratios of all three main units remain above their
respective operating levels. Group Solvency II ratio amounts to
212%
- Cash Capital at Holding decreases to EUR 1,368 million,
reflecting EUR 273 million dividends paid and second EUR 100
million tranche of previously announced EUR 300 million share
buyback
- Transamerica Life Bermuda (TLB), Aegon’s high-net-worth
business, reinsured a closed life insurance portfolio with
Transamerica in October. This frees up surplus capital and
strengthens Transamerica’s capital position
- Aegon takes action to substantially reduce the capital
sensitivity of its US variable annuity portfolio to equity markets
and further increase the predictability of free cash flows; a
third-party transaction will not be pursued in the near-term
Statement of Lard Friese, CEO“In recent months,
we have made great strides in the transformation of Aegon and the
acceleration of our strategy. We have made substantial progress on
our operational improvement plan, and have taken additional actions
to maximize the value of both our US variable annuity book and TLB,
Aegon’s high-net-worth insurance business. Most recently, we
announced a transaction with a.s.r. in the Netherlands to create a
leading Dutch insurance company.
In the third quarter, our operating result declined by 11% on a
constant currency basis as adverse market conditions more than
offset an improvement in claims experience in the United States,
expense savings and the benefit from growth initiatives. Despite
inflationary headwinds, we made considerable progress with our
expense savings program. We achieved additional
EUR 50 million expense savings compared with last
quarter, increasing the reduction in our annual addressable
expenses to EUR 300 million compared with the base year
2019. The growth initiatives, aimed at improving our customer
service and expanding our distribution network, positively impacted
our commercial and financial results.
We also made solid progress on our ambition to grow our
strategic assets, despite continued financial market volatility and
political unrest. Life insurance sales were up 24% in the United
States and 16% in our Growth Markets, supported by our growing
distribution capabilities. The retirement businesses across the
United States, the Netherlands and the United Kingdom all reported
growth in net deposits, reflecting the strength of the labor
market. Commercial results in Asset Management, the UK Retail
business and our US mutual fund platform were under pressure as a
result of our customers’ reduced propensity to invest in the
current uncertain environment.
We continue to take actions to maximize the value of our
financial assets. Based on extensive analysis, we have concluded
that the best option with respect to the US variable annuity
portfolio is to continue to own and actively manage it, at least in
the near term. In October, we finalized an internal reinsurance
transaction between TLB and Transamerica that freed up USD 600
million in excess capital for Transamerica. Part of this will be
used to create a buffer that will substantially reduce the capital
sensitivity of our US variable annuity book to equity markets.
The recent action we have taken to combine our Dutch pension,
life and non-life insurance, banking, and mortgage origination
activities with those of a.s.r., is pivotal to the transformation
of our company and reflects our goal to build advantaged businesses
in our chosen markets. The transaction enables us to accelerate the
return of capital to shareholders and is in line with our strategy
to release capital from mature businesses, and create leading
positions in markets where Aegon is well positioned for growth.
I appreciate the hard work and dedication of all our colleagues
to support our customers’ needs in challenging times. Thanks to the
efforts of our employees, we are able to continue to improve our
operational performance and accelerate our strategy. While economic
volatility will likely persist, our strong balance sheet,
disciplined risk management, and focused strategy make me confident
about the opportunities the future will bring.”
Note: All comparisons in this release are against 3Q 2021,
unless stated otherwise. See page 7 of the full press release for
key performance
indicators.
Media
relations |
Investor
relations |
Conference call
including Q&A (9:00 a.m. CET) |
Dick
Schiethart |
Jan Willem
Weidema |
Audio webcast on
aegon.com |
+31 (0) 6 22 88
99 25gcc@aegon.com |
+31 (0) 70 344
8028ir@aegon.com |
United States: +1
864 991 41 03 (local) United Kingdom: +44 808 175 15 36 (toll
free)The Netherlands: +31 800 745 83 77 (toll
free) |
|
|
Passcode: you will
receive a personal pin upon registration |
Additional information
PresentationThe conference call presentation is
available on aegon.com as of 7.30 a.m. CET.
SupplementsAegon’s 3Q 2022 Financial Supplement
and other supplementary documents are available on aegon.com.
Conference call including Q&AThe conference
call starts at 9:00 am CET, with an audio webcast on aegon.com. To
join the conference call and/or participate in the Q&A, you
will need to register via the following registration link.
Directly after registration you will receive an email with the call
details and a personal pin to enter the conference call.
Two hours after the conference call, a replay will be available
on aegon.com.
Click to joinWith ‘Call me’, there is no need to
dial-in. Simply click the following registration link and select
the option ‘Call me’. Enter your information and you will be called
back to directly join the conference. The link becomes active 15
minutes prior to the scheduled start time. Should you wish not to
use the ‘click to join’ function, dial-in numbers are also
available:
Dial-in numbers for conference callUnited
States: +1 864 991 41 03 (local)United Kingdom: +44 808 175 15 36
(toll-free)The Netherlands: +31 800 745 83 77 (toll-free)
Passcode: you will receive a personal pin
upon registration
Financial calendar 2022
/ 2023IFRS 9/17 Educational Webinar – December 14,
2022Fourth quarter 2022 results – February 9, 2023First quarter
2023 results – May 17, 2023Annual General Meeting – May 25,
2023Second quarter 2023 results – August 17, 2023Third quarter 2023
results – November 16, 2023
About Aegon
Aegon is an integrated, diversified, international financial
services group. The company offers investment, protection, and
retirement solutions, with a strategic focus on three core markets
(the United States, the United Kingdom, and the Netherlands), three
growth markets (Spain & Portugal, Brazil, and China), and one
global asset manager.
Aegon's purpose of Helping people live their best lives runs
through all its activities. As a leading global investor and
employer, the company seeks to have a positive impact by addressing
critical environmental and societal issues, with a focus on climate
change and inclusion & diversity.
Aegon is headquartered in The Hague, the Netherlands, and listed
on Euronext Amsterdam and the New York Stock Exchange. More
information can be found at aegon.com.
Cautionary note regarding non-EU-IFRS
measuresThis document includes the following non-EU-IFRS
financial measures: operating result, income tax, result before
tax, market consistent value of new business, return on equity and
addressable expenses. These non-EU-IFRS measures, except for
addressable expenses, are calculated by consolidating on a
proportionate basis Aegon’s joint ventures and associated
companies. The reconciliation of these measures, except for market
consistent value of new business and return on equity, to the most
comparable EU-IFRS measure is provided in the notes to this press
release. Market consistent value of new business is not based on
EU-IFRS, which are used to report Aegon’s primary financial
statements and should not be viewed as a substitute for EU-IFRS
financial measures. Aegon may define and calculate market
consistent value of new business differently than other companies.
Return on equity is a ratio using a non-EU-IFRS measure and is
calculated by dividing the operating result after tax less cost of
leverage by the average shareholders’ equity excluding the
revaluation reserve. Operating expenses are all expenses associated
with selling and administrative activities (excluding commissions)
after reallocation of claim handling expenses to benefits paid.
This includes certain expenses recorded in other charges, including
restructuring charges. Addressable expenses are expenses reflected
in the operating result, excluding deferrable acquisition expenses,
expenses in joint ventures and associates and expenses related to
operations in CEE countries. Aegon believes that these non-EU-IFRS
measures, together with the EU-IFRS information, provide meaningful
supplemental information about the operating results of Aegon’s
business including insight into the financial measures that senior
management uses in managing the business.
Local currencies and constant currency exchange
ratesThis document contains certain information about
Aegon’s results, financial condition and revenue generating
investments presented in USD for the Americas and in GBP for the
United Kingdom, because those businesses operate and are managed
primarily in those currencies. Certain comparative information
presented on a constant currency basis eliminates the effects of
changes in currency exchange rates. None of this information is a
substitute for or superior to financial information about Aegon
presented in EUR, which is the currency of Aegon’s primary
financial statements.
Forward-looking statementsThe statements
contained in this document that are not historical facts are
forward-looking statements as defined in the US Private Securities
Litigation Reform Act of 1995. The following are words that
identify such forward-looking statements: aim, believe, estimate,
target, intend, may, expect, anticipate, predict, project, counting
on, plan, continue, want, forecast, goal, should, would, could, is
confident, will, and similar expressions as they relate to Aegon.
These statements may contain information about financial prospects,
economic conditions and trends and involve risks and uncertainties.
In addition, any statements that refer to sustainability,
environmental and social targets, commitments, goals, efforts and
expectations and other events or circumstances that are partially
dependent on future events are forward-looking statements. These
statements are not guarantees of future performance and involve
risks, uncertainties and assumptions that are difficult to predict.
Aegon undertakes no obligation, and expressly disclaims any duty,
to publicly update or revise any forward-looking statements.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which merely reflect company
expectations at the time of writing. Actual results may differ
materially and adversely from expectations conveyed in
forward-looking statements due to changes caused by various risks
and uncertainties. Such risks and uncertainties include but are not
limited to the following:
- Unexpected delays, difficulties, and expenses in executing
against our environmental, climate, diversity and inclusion or
other “ESG” targets, goals and commitments, and changes in laws or
regulations affecting us, such as changes in data privacy,
environmental, safety and health laws;
- Changes in general economic and/or governmental conditions,
particularly in the United States, the Netherlands and the United
Kingdom;
- Civil unrest, (geo-) political tensions, military action or
other instability in a country or geographic region;
- Changes in the performance of financial markets, including
emerging markets, such as with regard to:
- The frequency and severity of defaults by issuers in Aegon’s
fixed income investment portfolios;
- The effects of corporate bankruptcies and/or accounting
restatements on the financial markets and the resulting decline in
the value of equity and debt securities Aegon holds;
- The effects of declining creditworthiness of certain public
sector securities and the resulting decline in the value of
government exposure that Aegon holds;
- Changes in the performance of Aegon’s investment portfolio and
decline in ratings of Aegon’s counterparties;
- Lowering of one or more of Aegon’s debt ratings issued by
recognized rating organizations and the adverse impact such action
may have on Aegon’s ability to raise capital and on its liquidity
and financial condition;
- Lowering of one or more of insurer financial strength ratings
of Aegon’s insurance subsidiaries and the adverse impact such
action may have on the written premium, policy retention,
profitability and liquidity of its insurance subsidiaries;
- The effect of the European Union’s Solvency II requirements and
other regulations in other jurisdictions affecting the capital
Aegon is required to maintain;
- Changes affecting interest rate levels and continuing low or
rapidly changing interest rate levels;
- Changes affecting currency exchange rates, in particular the
EUR/USD and EUR/GBP exchange rates;
- Changes in the availability of, and costs associated with,
liquidity sources such as bank and capital markets funding, as well
as conditions in the credit markets in general such as changes in
borrower and counterparty creditworthiness;
- Increasing levels of competition in the United States, the
Netherlands, the United Kingdom and emerging markets;
- Catastrophic events, either manmade or by nature, including by
way of example acts of God, acts of terrorism, acts of war and
pandemics, could result in material losses and significantly
interrupt Aegon’s business;
- The frequency and severity of insured loss events;
- Changes affecting longevity, mortality, morbidity, persistence
and other factors that may impact the profitability of Aegon’s
insurance products;
- Aegon’s projected results are highly sensitive to complex
mathematical models of financial markets, mortality, longevity, and
other dynamic systems subject to shocks and unpredictable
volatility. Should assumptions to these models later prove
incorrect, or should errors in those models escape the controls in
place to detect them, future performance will vary from projected
results;
- Reinsurers to whom Aegon has ceded significant underwriting
risks may fail to meet their obligations;
- Changes in customer behavior and public opinion in general
related to, among other things, the type of products Aegon sells,
including legal, regulatory or commercial necessity to meet
changing customer expectations;
- Customer responsiveness to both new products and distribution
channels;
- As Aegon’s operations support complex transactions and are
highly dependent on the proper functioning of information
technology, operational risks such as system disruptions or
failures, security or data privacy breaches, cyberattacks, human
error, failure to safeguard personally identifiable information,
changes in operational practices or inadequate controls including
with respect to third parties with which we do business may disrupt
Aegon’s business, damage its reputation and adversely affect its
results of operations, financial condition and cash flows;
- The impact of acquisitions and divestitures, restructurings,
product withdrawals and other unusual items, including Aegon’s
ability to integrate acquisitions and to obtain the anticipated
results and synergies from acquisitions;
- Aegon’s failure to achieve anticipated levels of earnings or
operational efficiencies, as well as other management
initiatives related to cost savings, Cash Capital at Holding, gross
financial leverage and free cash flow;
- Changes in the policies of central banks and/or
governments;
- Litigation or regulatory action that could require Aegon to pay
significant damages or change the way Aegon does business;
- Competitive, legal, regulatory, or tax changes that affect
profitability, the distribution cost of or demand for Aegon’s
products;
- Consequences of an actual or potential break-up of the European
monetary union in whole or in part, or the exit of the United
Kingdom from the European Union and potential consequences if other
European Union countries leave the European Union;
- Changes in laws and regulations, particularly those affecting
Aegon’s operations’ ability to hire and retain key personnel,
taxation of Aegon companies, the products Aegon sells, and the
attractiveness of certain products to its consumers;
- Regulatory changes relating to the pensions, investment, and
insurance industries in the jurisdictions in which Aegon
operates;
- Standard setting initiatives of supranational standard setting
bodies such as the Financial Stability Board and the International
Association of Insurance Supervisors or changes to such standards
that may have an impact on regional (such as EU), national or US
federal or state level financial regulation or the application
thereof to Aegon, including the designation of Aegon by the
Financial Stability Board as a Global Systemically Important
Insurer (G-SII); and
- Changes in accounting regulations and policies or a change by
Aegon in applying such regulations and policies, voluntarily or
otherwise, which may affect Aegon’s reported results, shareholders’
equity or regulatory capital adequacy levels.
This document contains information that qualifies, or may
qualify, as inside information within the meaning of Article 7(1)
of the EU Market Abuse Regulation (596/2014). Further details of
potential risks and uncertainties affecting Aegon are described in
its filings with the Netherlands Authority for the Financial
Markets and the US Securities and Exchange Commission, including
the Annual Report. These forward-looking statements speak only as
of the date of this document. Except as required by any applicable
law or regulation, Aegon expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change
in Aegon’s expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is
based.
- 20221110_PR Aegon_3Q 2022 results
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