Assicurazioni Generali S.p.A.

Good afternoon. This is the Corusco conference operator. Welcome and thank you for joining the Generali Group first half 2025 results presentation. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Fabio Cleva, Head of Investor and Rating Agencies Relations. Please go ahead, sir.

Hello, everyone, and thank you for joining our first half 2025 results call. Here with us today, we have the Group CEO, Philippe Donnet, the Group General Manager, Marco Cesana, the CEO of Insurance, Giulio Terzariol, and the Group CFO, Cristiano Boran. Before opening up for Q&A, let me hand it over to Philippe for some opening remarks.

Thank you, Fabio. Good afternoon to all of you, and thank you for joining this call. Our excellent performance for the first half of 2025 shows a strong start to our new three-year strategic plan, Lifetime Partner 27, Driving Excellence. These results demonstrate that this is the right strategy to continue to create further value for our investors and for all stakeholders in a consistent and disciplined way. I would like to draw your attention to five key messages. First, Generali once again recorded significant and continued growth in operating results, exceeding €4 billion. The 8.7% year-on-year increase is underpinned by the positive contributions of property casualty, life, and asset management. highlighting the power of our diversified and integrated business model. Adjusted net result exceeded 2.2 billion Euro, growing by 10.4% while adjusting earnings per share rose even more sharply by 12.5% year on year. These performance underscores our relentless focus on value creation for our shareholders further reinforced by the now approved 500 million euro share buyback we announced today. This is the proof that we are delivering on the clear and transparent capital management framework we presented to you at our investor day in January. My second message is about property casualty. As you know, this is a key element as we strive for excellence in our core capabilities one of the three pillars of our current plan. The strong growth in the P&C operating result shows our disciplined focus on the delivery of our strategy. Healthy top-line growth coupled with margin expansion is at the heart of the strong growth in the P&C operating result, up by over 18% year-on-year despite a lower benefit from discounting. The 170 basis points improvement in the current year's attritional and discounted loss ratio is the proof of a very successful delivery on the action plan we designed two years ago to reassert technical excellence. So let me thank all our colleagues for their commitment and efforts. Third, the life business is coming back strongly. thanks to our efforts to address lapses, which are now mostly resolved thanks to the new products we designed and the effectiveness of the commercial efforts made on the distribution side. In fact, lapses have fully normalized in France and improved materially in Italy as reflected in the positive operating variances in our CSM in the first six months of the year. Life net inflows exceeded 6.3 billion euros driven by our preferred business lines. We have further increased the share of capital-like products in our new business production to almost 88%, a very high level, with the share of new business without guarantees increasing to 77%, up from 67% a year ago. The new business margin is also improving, reaching 5.6% in the second quarter. We are confident that this will be maintained in the second half, well on track to reach our 6% target in 2027. Achieving strong volumes of net inflows without compromising underwriting discipline is something generally will continue to deliver to deliver on thanks to the very effective work done by our agents and advisors. As a fourth point, I would like to highlight the importance of our strategic focus on protection, health and accident, an area of compelling long-term profitable growth potential. It is growing strongly with high margins, low capital consumption and fast cash conversion. As of June 30th, It accounted for 20% of overall gross return premiums at group level with a 7.1% year-to-year increase. We will continue to update you on the performance of the strategic business segment that is at the center of our plan. Finally, asset management delivered an 11.7% increase in terms of operating result. This reflects both the contribution of conning and the organic growth of the business. It was a very high quality result with almost no performance fees booked in the period. Net inflows from third parties were positive to the tune of 3.6 billion euro, a good result given the significant volatility of financial markets in the first half of the year. In conclusion, these results confirm the strong start of the execution of our ambitious Lifetime Partner 27 Driving Excellence Plan, which will deliver even greater value for all our stakeholders. Our achievements against our three strategic priorities, excellence in customer relationships, excellence in our core capabilities, and excellence in our operating model, prove we are on the right track. In customer relationships, we further improved our relationship net promoted score, maintaining the number one position in our peer group, while also improving customer retention levels. For our core capabilities, the year-on-year increase in the operating result, both in property casualty and in life, further confirms the great work we have been doing over the past years. As far as our operating model, we are continuing to invest in artificial intelligence and technology while centralizing distinctive capabilities and shared services at scale. By the end of this year, we will have invested a total of 500 million euro. These achievements were enabled by our continuous focus on the plan's three key foundations, our people, who are generally the most important strength, AI and data, which are vital to our success today and in the future, and sustainability as we continue to support a green and just transition while actively fostering societal resilience. We are firmly committed and focused on executing Lifetime Partner 27 driving excellence as you can also clearly see in the slides provided today. And I am very confident that we will deliver it as successfully as we did with all our previous plans. Before we open on Q&A session, let me share some brief closing remarks on the topic of M&A. We are proud of the rigorous process we have established for M&A here at Generali. with strict criteria to assess the financial and strategic fit of any potential transaction within the best-in-class governance and legal framework. This process has served us very well so far, which also means we have the right toolkit to analyze Mediobanca's offer for Banca Generali. As far as this, it is our duty to examine in full detail opportunities such as a potential future industrial relationship with the leader in Italian wealth management, determining whether they would fit with our strategy and could generate value for our stakeholders. The management team has been working hard to provide the best possible support to our board of directors as it continues to evaluate and discuss the potential merits of the offer in full compliance with the group's processes and schedules. This is necessary to ensure our directors can form a definitive view and ultimately reach a decision that is in the best interest of all our stakeholders. This sums up the current status of our deliberations regarding Banca Generale. We will continue to update the market and our key stakeholders were never relevant. Thank you again for your attention and for your interest in our group, and we are now happy with my colleagues to take all your questions. Thank you.