Results season continues with Talanx Group releasing its interim numbers for the first nine months of the financial year.
According to HDI Global SE’s parent, group net income would have been up year-on-year if not for the blow dealt by the COVID-19 pandemic. Instead, Talanx posted a 30% decline in group net income, from €742 million (around CA$1.15 billion) in the first nine months of 2019 to €520 million (around CA$808 million) this time around.
In a release, the Germany-headquartered insurance group noted that the coronavirus crisis “depressed” its net income by €356 million. It said total COVID-19 losses in the period amounted to nearly €1.06 billion.
“Net coronavirus expenses of €842 million impacted operating profit, which amounted to €1.29 billion,” added Talanx, whose underwriting result saw a decrease of more than 50%.
As for third quarter performance, group net income in the three-month span similarly fell by 26.7% to €194 million. Additionally, the company registered an 11.8% drop in its Q3 operating profit.
Management board chair Torsten Leue, nonetheless, expressed a positive outlook.
Leue stated: “The coronavirus pandemic is and remains a challenge. Luckily we are seeing profitable growth and are in robust shape. Group net income is impressive given the pandemic and the high level of losses seen in the hurricane season.
“A better overview of pandemic-related expenses means we are now able to issue an earnings forecast: we are confident both for the coming months and for next year. We are expecting group net income for 2020 to be clearly above €600 million and for it to grow in 2021 to €800-900 million.”
Meanwhile, subject to supervisory authorities’ approval, Talanx aims to pay a 2020 dividend at the prior-year level of €1.50 per share.