Aegon's net income for the first half of 2019 reached EUR 618 million, 26 percent more than the net income registered in the first half of prior-year. According to Aegon, the growth was driven by realized gains and lower other charges, partly offset by a higher loss on fair value items.
1H2019 financial figures (vs. 1H2018) - unaudited
Underlying earnings before tax: EUR 1,010 million (-5%), of which:
Europe, Netherlands: EUR 328 million (%)
Europe, UK: EUR 70 million (%)
Europe, SEE: EUR 42 million (%)
Europe: EUR 439 million (+1%)
Americas: EUR 576 million (-4%)
Asia: EUR 32 million (+2%)
Asset Management: EUR 60 million (-27%)
Holding and other: EUR (98) million (-12%)
Net underlying earnings: EUR 833 million (-3%)
Net income/(loss): EUR 618 million (+26%), of which:
Europe, Netherlands: EUR 67 million (-82%)
Europe, UK: EUR (44) million (-55%)
Europe, SEE: EUR 92 million (+441%)
Europe: EUR 115 million (-60%)
Americas: EUR 660 million (+128%)
Asia: EUR 8 million (+700%)
Asset Management: EUR 43 million (-22%)
Return on equity: 9.6% (-0.5 pp.)
Total net deposits/outflows: EUR (2,651) million (1H2018: EUR 3,891 million)
New life sales (APE): EUR 405 million (-4%)
Value of new business (VNB): EUR 270 million (-11%)
Aegon's underlying earnings before tax decreased by 5% compared with the first half of 2018 to EUR 1,010 million. Excluding favorable currency movements, earnings decreased by 9%. This was largely the result of lower fee income from Retirement Plans and Variable Annuities in the US, as well as investments in the business to support growth and to improve customer experience. Furthermore, Asset Management recorded lower performance fees, while the loss in the Holding increased as more interest expenses were reported through the profit & loss account instead of directly through shareholders' equity.
Operating expenses increased by 3% to EUR 1,918 million, but were flat on a constant currency basis. This reflects investments to support growth and improve customer experience in the United States, the acquisition of Robidus in the Netherlands, and higher IFRS 9 / 17 implementation expenses. These were offset by lower restructuring expenses in the United States and the divestment of Aegon's Czech, Slovak and Irish operations.
Return on equity decreased by 50 basis points compared with the same period last year to 9.6% in the first half of 2019, caused by lower net underlying earnings and higher average shareholders' equity excluding revaluation reserves.
Despite a decrease of Aegon's Group Solvency II ratio from 211% to 197% during the first half of 2019, the ratio was at the upper end of the target zone of 150 - 200%. The ratio decreased, as normalized capital generation was more than offset by payment of the final 2018 dividend, adverse market impacts, and one-time items, including model & assumption changes in Asia.
More financial information about Aegon's Q2 and 1H of 2019 performance can be found on Aegon's Investor Relationship section from company's website.
Netherlands-based Aegon operates globally, in more than 20 countries across Europe, Americas and Asia. In XPRIMM surveyed countries from CEE/SEE/CIS regions, Aegon is active in 4 important insurance markets - Hungary, Poland, Romania and Turkey.