Comprehensive income expected to increase to
2 billion NIS
Targeting 16-18% return on equity
Committed to returning over 50% of profit to
shareholders through dividends and share buybacks
TEL
AVIV, Israel, Sept. 9,
2024 /PRNewswire/ -- Phoenix Financial Ltd. (formerly
Phoenix Holdings), Israel's
leading insurance, investment, and financial company (TLV:PHOE)
("Phoenix" or the "Company")
announced its strategic and financial targets for 2027.
Phoenix first announced its
strategy and financial targets in 2020, revised them upward in
2022, and has met them ahead of schedule.
In today's update, Phoenix
increased its comprehensive income target to 2 billion NIS, or approximately 8 NIS per share, announced its intention to
return over 50% of its annual income to shareholders through
dividends and share repurchases, and set a target range for return
on equity of 16-18%. Total assets under management are expected to
reach 600-650 billion NIS by
2027.
The updated targets mark an acceleration of Phoenix's proven strategy, which has resulted
in capital-efficient and systematic growth of profitable activities
generating strong recurring cash flow. This strategy is allowing
Phoenix to grow rapidly while
distributing dividends to shareholders.
The targets for 2027 reflect the continued execution of the
group's value-creation strategy that has transformed Phoenix from an insurance company into a
leading financial services firm. The strategy includes four levers
for value creation:
- accelerated growth in high margin, capital-efficient
activities;
- innovation for competitive advantage and efficiency;
- active management across all business areas; and
- effective management of capital and investments.
Phoenix is targeting continued
significant growth in its two main activities of insurance and
asset management, distribution, and credit. The Group has targeted
total insurance profit of 1.1-1.3 billion
NIS and total profit from asset management, distribution,
and credit activities of 700-900 million
NIS by 2027.
First, the group will continue to focus on its growth engines of
asset management (Phoenix Investment House, formerly Excellence;
qualified clients and alternative investments; retirement solutions
including pensions and provident funds), insurance agencies managed
independently to create and unlock value; and business and consumer
credit through its subsidiary Phoenix-Gama. Each of these platforms
is a leader in its field with strong and committed management
teams.
Second, in its insurance business, Phoenix will continue to leverage and deepen
its competitive advantages including technology for underwriting
and claims, hybrid distribution via direct channels and agents,
distinctive products, and capital and investment management that
creates financial strength, a high solvency ratio, liquidity, and
ratings. At the same time, Phoenix
will continue optimizing insurance activities including shifting
the product mix to more capital-efficient products, increasing
operational efficiency, focusing on continuous improvement in
service, and reducing volatility and non-operational effects on
performance.
The Company is focused creating value for shareholders and has
built a track record of consistent and regular dividend
distributions while conducting share buybacks. Since 2020, the
company returned 2 billion NIS to
shareholders through dividends with an average 5% yield over this
period, as well as share buybacks totaling 300 million NIS.
Eyal Ben Simon, Phoenix CEO,
explained: "The group's targets for 2027 are centered around
profitable growth that generates a strong return on equity and
sufficient cash flows to continue to grow our businesses while
returning significant value to shareholders through dividends.
Achieving these targets is based on continued execution of our
proven strategy for value creation and builds on the infrastructure
we have established and our organizational capabilities. We believe
in the potential of the Israeli economy and are focused on
continuing to expand both our insurance activities and our asset
management, distribution, and credit operations. We will continue
to take actions to increase the group's profitability while
investing in technologies that further our competitive advantages
and enhance the experience of our clients. Phoenix is Israel's largest financial group offering a
broad range of services and capabilities under a strong brand and
leading in business and competitive positioning as well as
financial strength. We will continue to leverage these assets while
delivering compelling value propositions for our clients."
About Phoenix Financial
Phoenix Financial Ltd. is a leading Israel-based financial and investment group
traded on the Tel Aviv Stock Exchange (TASE: PHOE). Group
activities include multi-line insurance, asset management, credit,
and brokerage services, and have demonstrated strong growth and
performance across the cycle. Phoenix serves a significant portion of
Israeli households with a broad set of activities and solutions
across businesses and client segments. Managing roughly
$130 billion in assets, Phoenix accesses Israel's vibrant and innovative economic
activity through a robust investment portfolio, creating value for
clients and shareholders.
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SOURCE Phoenix Financial Ltd.