Hannover Rück (HNR1) Q2 2025 earnings summary

Executive summary

• Group net income for H1 2025 rose 13.2% year-over-year to EUR 1.314 billion, driven by strong underlying profitability, positive currency effects, and tax benefits, supporting further balance sheet strengthening.

• Reinsurance revenue increased by 3.3% to EUR 13.3 billion, with growth of 4.3% at constant exchange rates.

• Return on equity reached 23%, well above the >14% ambition, and solvency ratio stood at 261%, exceeding the >200% target.

• Shareholders' equity decreased by about 6% since year-end 2024, mainly due to negative currency effects and dividend payout.

• Additional prudency was added to P&C reserves and a more cautious view was taken on certain Life and Health portfolios, with realized losses in the fixed income portfolio to further bolster resilience.

Financial highlights

• Operating profit (EBIT) increased 6.3% year-over-year to EUR 1,762 million.

• Return on investment was 3.3%, in line with the target, despite EUR 60 million in realized fixed income losses in Q2.

• Combined ratio for P&C reinsurance at 88.4%, slightly above target due to large losses.

• Investment result improved 3.6% to EUR 1,046 million, with ordinary income up and moderate realization of fixed-income losses.

• Earnings per share rose to EUR 10.90 from EUR 9.63 in the prior year.

Outlook and guidance

• Guidance for 2025 remains unchanged: group net income expected at EUR 2.4 billion, P&C revenue growth of at least 7%, combined ratio below 88%, Life & Health service result above EUR 875 million, and CSM growth around 2%.

• Confidence in achieving targets is underpinned by strong H1 results and prudent reserving.

• Large loss budget for 2025 raised to EUR 2.1 billion to reflect portfolio growth and higher expected natural catastrophe losses.