Allianz Raises Operating Profit Target on Asset-Management Gain

Allianz SE (ALV), Europe’s biggest insurer, raised its full-year operating profit target after third-quarter net income was boosted by higher earnings from asset-management.

Allianz expects operating profit to exceed 9 billion euros ($11.6 billion), assuming “normal business development” during the remainder of the year, the Munich-based company said in a statement late yesterday. That compares with the 8.57 billion- euro average estimate of 19 analysts surveyed by Bloomberg.

The insurer, led by Chief Executive Officer Michael Diekmann, in August confirmed its full-year operating profit target “despite the challenging environment.” Third-quarter net income rose to 1.4 billion euros from 196 million euros reported a year ago, while operating profit climbed 31 percent to 2.5 billion euros, according to preliminary results.

While Allianz cited a “better-than-expected performance across all segments,” the asset management unit, which includes Newport Beach, California-based Pacific Investment Management Co., contributed “especially” to third-quarter earnings, the company said.

Allianz plans to publish full figures for the third quarter on Nov. 9.

Allianz said earlier this month that asset management inflows remain “strong.” The insurer plans to expand the unit’s operating profit, excluding currency movements, by 5 percent to 10 percent “over a full cycle.”

Full-year net income will be “comparatively lower because of further balance sheet strengthening, including investment de- risking and restructuring activities,” as already seen in the first nine months of 2012, the insurer said.

Allianz climbed 26 percent in Frankfurt trading this year, valuing the insurer at 42 billion euros. The Bloomberg Europe 500 Insurance Index rose 21 percent over the same period.

To contact the reporter on this story: Oliver Suess in Munich at osuess@bloomberg.net

To contact the editors responsible for this story: Frank Connelly at fconnelly@bloomberg.net; Edward Evans at eevans3@bloomberg.net

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