Summary of Financial Results
Q1.2024
May 29, 2024
Harel Group, the Board of Directors, Management and employees support the defense forces and stand with the families of the hostages, hoping and praying for their safe and speedy return home.
We offer our condolences to the bereaved families and feel the pain of their terrible loss in the horrific terror attack on October 7.
At this time, Harel Group expresses its resounding faith in the resilience of the State of Israel and the strength of the Israeli economy. As a leading Israeli company, we will continue to support and contribute to our country and society, from a position of solidarity and national responsibility. Together we will overcome the challenges facing us and continue to build a better future for all of us in Israel.
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Agenda
Key messages
Strategy
Financial overview
Appendix
3
Harel Insurance Investments and Financial Services
Largest insurance and finance group in Israel
Premiums and Deposits* | Shareholders' Equity | AUM | S&P Maalot | |||
NIS B | NIS B | NIS B | ilAA+/Stable | |||
9.9 | 8.7 | 453 | ||||
Q1.24 | Q1.24 | Q1.24 | Harel Insurance | |||
Q1.23 | 9.2 | Q1.23 | 8.4 | Q1.23 | 377 | Midroog |
Aa1.il stable | ||||||
Harel Insurance | ||||||
Comprehensive Income | ROE | Solvency Capital Ratio | Aa2.il stable | |||
NIS M | Including transitional measures | Harel Investments | ||||
Q1.24 | 233 | Q1.24 | 11% | 31.12.23 | 168% | Maala CSR |
Q1.23 | 33 | Q1.23 | 2% | 30.06.23 | 167% | Platinum Plus |
Harel Investments |
Largest Insurance and Financial Group in Israel - in terms of gross premiums earned and contributions to pension funds and provident funds and amounts received for investment contracts as of 31.12.2023
4 *Gross premiums earned and contributions to pension funds and provident funds and amounts received for investment contracts
Key
Messages
Q1.24
Continuous growth in quarterly profit
Improvement in all segments
Positive real Nostro return
Growth in premiums, deposits and AUM
Increase in Solvency Capital Ratio
Q1.24 profit was NIS 233 M compared with NIS 33 M in Q1.23 supported by underwriting improvement in all segments,
despite War impact of NIS 34 M before tax, and by higher nostro returns
NIS 178 M underwriting improvement in insurance, NIS 16 M improvement in AM and NIS 6 M improvement in credit -
reflecting ongoing strategy implementation
Positive real Nostro return of 0.8% in Q1.24 compared with negative real return of (0.1%) in Q1.23
With premiums and deposits* of NIS 9.9 B, AUM of NIS 453 B as of 31.03.2024, up 6% from YE2023.
Solvency Capital Ratio without transitional measures increased to 138% as of 31.12.2023, compared with 126% as of 30.06.2023 largely due to increase of interest rate curve
5 | *Gross premiums earned and contributions to pension funds and provident funds and amounts received for investment contracts |
Underwriting profit in Life, Health, Non-life segments and profit in Equity segment are calculated assuming 3% real return, excluding special effects. See Appendix for full list of assumptions |
Agenda
Key messages
Strategy
Financial overview
Appendix
6
StrategicFocus
Improving Diversifying Profitability and Revenues
Leveraging scale for material and permanent
improvement of insurance profitability and revenue
diversification
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#1Operational Excellence
Strategy #2Leveraging Existing
Implementation 3Customers
# Revenue
Diversification
Improving insurance
profitability
Continue growing in profitable products
Expanding non-
insurance activities
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Our targets:
Harel 2026
Comprehensive income NIS M after tax
1,447
770
600
233
(77)
2022 | 2023 | Average | Q1.24 | 2026 |
2019-2023 |
ROE
13.5%
10% 11%
7%
(1%)
2022 | 2023 | Average | Q1.24 | 2026 |
2019-2023 |
Key forecast assumptions: Real Nostro return of 3.0%, change in CPI 3.0%, implementation of strategic plan to improve profitability and diversify revenues. Premium growth is consistent with industry growth assuming that Harel's share is maintained. Q1.24 and 2026 premiums do not include Group LTC premiums for Clalit HMO contract Increase in AUM reflects the past deposits development (continuous growth in pension and provident funds). Fees include 124 M variable fees in 2026, in 2022-2023 and in Q1.24 variable fees were not collected. Dividend inline with existing policy. Assumed tax rate is 34.746%. Actual performance may differ from forecast, due to changes in capital market returns, marco data including growth and inflation, regulatory changes and other variables.
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Our targets:
Harel 2026
AUM NIS B | Premiums and Deposits* NIS B |
520 | 39.4 | 43.8 | |||||
453 | 37.5 | ||||||
428 | |||||||
363 | |||||||
9.9 | |||||||
2022 | 2023 | 31.3.24 | 2026 | 2022 | 2023 | Q1.24 | 2026 |
Fee Income NIS B
1.91
1.47 1.53
0.4
2022 | 2023 | Q1.24 | 2026 |
Key forecast assumptions: Real Nostro return of 3.0%, change in CPI 3.0%, implementation of strategic plan to improve profitability and diversify revenues. Premium growth is consistent with industry growth assuming that Harel's share is maintained. Q1.24 and 2026 premiums do not include Group LTC premiums for Clalit HMO contract Increase in AUM reflects the past deposits development (continuous growth in pension and provident funds). Fees include 124 M variable fees in 2026, in 2022-2023 and in Q1.24 variable fees were not collected. Dividend inline with existing policy. Assumed tax rate is 34.746%. Actual performance may differ from forecast, due to changes in capital market returns, marco data including growth and inflation, regulatory changes and other variables.
*Gross premiums earned and contributions to pension funds and provident funds and amounts received for investment contracts
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Harel Insurance Investments & Financial Services Ltd. published this content on 29 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 May 2024 05:37:02 UTC.