Phoenix Financial (PHOE) Q2 2022 earnings summary

Executive summary

• H1 comprehensive income was NIS 537m, down from NIS 1,153m a year earlier; Q2 income was NIS 184m, versus NIS 797m, mainly reflecting capital-market declines.

• H1 ROE was 11.4% and Q2 ROE 7.9%; AUM reached NIS 361bn and shareholders’ equity NIS 9.7bn at June 30.

• Core businesses grew, with non-insurance activities generating NIS 193m of after-tax comprehensive income excluding special items; premiums and contributions rose 36% YoY to NIS 17.1bn.

Financial highlights

• H1 pre-tax income from operations was NIS 925m, up NIS 287m YoY; the pre-tax financial margin was negative NIS 451m.

• Q2 pre-tax income from operations was NIS 586m, up NIS 207m YoY; the pre-tax financial margin was negative NIS 580m.

• H1 premiums, benefit contributions and investment contracts totaled NIS 29.9bn; premiums and contributions alone were NIS 17.1bn, versus NIS 12.6bn a year earlier.

• Asset management, agencies and credit income was NIS 193m in H1 and NIS 99m in Q2.

Outlook and guidance

• 2025 targets include AUM of NIS 450–550bn, shareholders’ equity of NIS 11–13bn, comprehensive income of NIS 1.3–1.5bn and ROE of 12%–15%.

• Targets assume 3% investment returns; priorities include high-ROE, capital-efficient growth, technology, efficiency and active investment management.

• NIS 1bn is being invested in technology and data capabilities; near-term priorities include accelerating income growth and further efficiency gains.