By Monica Houston-Waesch
FRANKFURT-- Allianz SE's fourth-quarter results were
overshadowed on Thursday by outflows at Pacific Investment
Management Co., where clients continue to pull assets in the wake
of a management shake-up at the U.S.-based bond fund last fall.
The German insurer said third-party net outflows at Pimco fell
18% to EUR236 billion ($268.1 billion) in 2014, with more than 70%
coming after September when Bill Gross, Pimco's co-founder, left
the fund .
Information for February's outflows wasn't yet available, but
it's expected to be at around January's level, when outflows at
Pimco's flagship Total Return fund ebbed to $11.6 billion from
$19.4 billion in December.
"Many institutional investors decided to leave in October, and
these decisions were carried out in December and January," Allianz
Chief Executive Michael Diekmann said Thursday.
Operating profit at Pimco came to EUR488 million in the fourth
quarter, down nearly 19% from EUR599 million in the same period a
year earlier. Pimco's third-party assets under management amounted
to EUR1.053 trillion at the end of 2014, down from EUR1.114
trillion a year earlier.
Allianz reported fourth-quarter net profit of EUR1.22 billion
compared with EUR1.26 billion a year earlier. Operating profit rose
to EUR2.26 billion in the quarter, bringing the full-year figure to
EUR10.4 billion, the upper end of the company's target range, and
slightly higher than the 2013 figure.
"The fourth-quarter operating performance was
disappointing...the contribution from Asset Management was also
below expectations," Olivier Pauchaut, analyst at Bryan, Garnier
& Co. said in a research note.
Operating profit at Allianz's asset management operations, which
include Pimco, tumbled 16% to EUR588 million from EUR703 million
the fourth quarter in 2013.
All in all, operating profit was about 6% below consensus, said
Jeffries analyst Mark Cathcart, due to nonlife claims, Pimco
outflows and lower fees.
At midday in Europe, Allianz's shares were down 2.0% at
EUR146.90.
Allianz's dividend increase also disappointed, analysts said.
The insurer raised its 2014 dividend to EUR6.85 per share from
EUR5.30, short of expectations of EUR6.90-EUR7 per share.
Allianz has forecast an operating profit of between EUR10
billion-EUR10.8 billion for 2015. That is not far from the 2014
level, in part reflecting outflows at Pimco, Mr. Cathcart said.
For 2015, Allianz has forecast asset management operating profit
at between EUR2.2 billion to EUR2.8 billion, likely boosted by
currency effects and expected performance fees late in the year,
Mr. Diekmann said. "I don't see a great deal of pressure here," he
added.
Allianz also boosted its medium-term target for asset-based
investments in real estate, infrastructure and renewable energy,
amid low interest rates, geopolitical flares and market volatility.
Allianz now plans asset-based investment of EUR110 billon, up from
a previous target of EUR80 billion.
Write to Monica Houston-Waesch at nikki.houston@wsj.com
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