Half Year 2014 Earnings

Transcription

1 Half Year 2014 Earnings August 1, 2014 Presentation

2 Cautionary note concerning forward-looking statements Certain statements contained herein may be forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results and AXA s plans and objectives to differ materially from those expressed or implied in the forward looking statements. Please refer to the section Cautionary statements in page 2 of AXA s Document de Référence for the year ended December 31, 2013, for a description of certain important factors, risks and uncertainties that may affect AXA s business, and/or results of operations. AXA undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise. A2 AXA Earnings August 1, 2014

3 Table of contents Introduction & highlights Page A3 by Henri de Castries, Chairman and CEO financial performance by Denis Duverne, Deputy CEO & Gérald Harlin, Group CFO Page A10 Concluding remarks Page A36 by Henri de Castries, Chairman and CEO A3 AXA Earnings August 1, 2014

4 Strong growth in earnings Underlying Earnings Adjusted Earnings In Euro billion % 2.8 In Euro billion % 3.1 Change is at constant Forex Change is at constant Forex Net income In Euro Underlying Earnings per share +6% % adjusted for Forex effects In Euro billion % 3.0 Change is on a reported basis Change is at constant Forex A4 AXA Earnings August 1, 2014

5 Selectivity Delivering profitable growth in 2014 Life & Savings On track to grow APE in 2014 Property & Casualty Portfolio growth In Euro billion 0% Personal net new contracts -178k +328k Var. +2% 2Q13 2Q14 +8% Revenues In Euro billion Q13 1Q14-6% Profitability enhanced by selectivity efforts Continuous improvement in profitability NBV margin 32% 34% CY combined ratio 97.5% 97.1% Underlying Earnings Euro 1.5bn Euro 1.7bn Underlying Earnings Euro 1.1bn Euro 1.2bn A5 AXA Earnings August 1, 2014 Changes are on a comparable basis

6 Acceleration Double-digit earnings development in high growth markets In Euro million Change is at constant Forex Life & Savings Underlying earnings +19% Property & Casualty Underlying earnings +15% High growth markets In Euro million Change is on a comparable basis ICBC-AXA Life AXA-Tian Ping * APE Group share Revenues +21% +30% Focus on China Positive contribution to Underlying Earnings Access to more than 7,000 ICBC branches Investing in brand, claims and pricing capabilities leveraging Group know-how 30% of premiums coming from Direct channel in, up from 20% in 2012 * AXA-Tian Ping is not included in Group revenues due to consolidation in equity method. Figures shown on the graph correspond to the period of January 1 to June 30. Acquisition of 50% of Tian Ping was completed on February 20, 2014 A6 AXA Earnings August 1, 2014

7 Efficiency On track to deliver an increased Euro 1.9 billion target In Euro billion Increased cost savings target E cost savings target (in mature Life & Savings and Property & Casualty entities) Further Euro 0.2 billion added to the target, from Life & Savings acquisition costs Sales support productivity improvement Marketing efficiency Initial target June 2011 Updated February 2013 Updated August 2014 Commissions optimization Achievement in Euro 0.2 billion cost savings achieved in Euro 1.3 billion achieved since the beginning of Ambition AXA A7 AXA Earnings August 1, 2014

8 Performing well in a low interest rate environment resulting from key management actions Well diversified business mix reduces earnings volatility Ca. 70% of Group pre-tax Underlying Earnings 1 coming from Property & Casualty and Protection & Health 2, i.e. businesses less sensitive to financial markets Strong ALM discipline Ca. 1 year Duration gap maintained around one year between assets and liabilities (which are mostly long term in nature) Decreased sensitivities to low interest rate environment Ca. Euro -100 million Estimated impact on Underlying Earnings 3 should interest rates be 100bps lower for 1 year Note: FY13 Group Embedded Value sensitivity to a -100bps parallel shift in risk-free rates: -5% A8 AXA Earnings August 1, 2014 All notes are on page A39 of this document

9 Generating earnings and dividend growth Delivering on 5-10% Underlying EPS 1 CAGR 2 target In Euro per share 1.57 FY10 published 1.57 FY11 published 1.69 FY12 published 1.85 FY Sustained growth in dividend In Euro million Guidance of Euro million of Net RCG 1 per year FY10 FY11 3 FY12 FY13 In Euro per share TBD Payout ratio of 40-50% of Adjusted Earnings 4 40% FY10 49% FY % FY12 40% FY13 FY10 FY11 FY12 FY13 FY14E A9 AXA Earnings August 1, 2014 All notes are on page A39 of this document

10 Table of contents Introduction & highlights Page A3 by Henri de Castries, Chairman and CEO financial performance by Denis Duverne, Deputy CEO & Gérald Harlin, Group CFO Page A10 Concluding remarks Page A36 by Henri de Castries, Chairman and CEO A10 AXA Earnings August 1, 2014

11 Ambition AXA Delivering on financial objectives in In Euro per share Underlying Earnings per share In Euro billion Group operating free cash flows in line with Ambition AXA objectives Ambition AXA CAGR +5% to +10% Ambition AXA cumulative Euro 24 billion 1H10 published 1H11 published 1H12 published published FY11 FY12 FY13 Adjusted return on equity 1 Debt gearing Average adjusted shareholders equity 2 (in Euro billion) % 13.5% 13.8% % % 13-15% 29% 28% 27% 26% 24% 23-25% 1H10 published 1H11 published 1H12 published published Ambition AXA H10 published 1H11 published 1H12 published published 2015E Target A11 AXA Earnings August 1, 2014 All notes are on page A39 of this document

12 financial performance Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A12 AXA Earnings August 1, 2014

13 Underlying Earnings (1/2) Underlying Earnings Underlying Earnings by segment In Euro million +11% 2,777 In Euro million Constant Forex Life & Savings 1,534 1, % 2,579 Property & Casualty 1,128 1,226 +9% International Insurance % Asset management % +11% on a comparable basis (excluding AXA Private Equity 1 ) Banking % Change is at constant Forex Holdings % Underlying Earnings 2,579 2, % A13 AXA Earnings August 1, 2014 All notes are on page A39 of this document

14 Underlying Earnings (2/2) In Euro million Of which Euro -30 million due to the loss of MONY contribution Of which Euro -26 million due to the loss of AXA Private Equity contribution Mainly due to investments in Brand and Digital Adverse impact mostly from JPY depreciation 2,777 2,579 Life & Savings P&C International insurance Asset management Banking Holdings Forex A14 AXA Earnings August 1, 2014 All notes are on page A39 of this document

15 Adjusted Earnings In Euro million Adjusted Earnings Details of Adjusted Earnings 2,954 +8% 3, In Euro million Underlying Earnings 2,579 2, Net realized capital gains/losses Net realized capital gains o/w realized capital gains o/w net impairments o/w hedging of equity portfolio Adjusted Earnings 2,954 3,112 Change is at constant Forex Adjusted Earnings increase mainly driven by higher Underlying Earnings despite lower net realized capital gains A15 AXA Earnings August 1, 2014

16 Net Income In Euro million Net Income Details of Net income 2, % 3,008 In Euro million Adjusted earnings 2,954 3,112 Change in fair value & Forex o/w gains/losses on derivatives not eligible for hedge accounting under IAS 39 o/w gains/losses on Forex economic hedges not eligible for hedge accounting under IAS 39 o/w change in fair value of assets accounted for as fair value option Exceptional and discontinued operations Integration & Restructuring costs Intangibles amortization and other Net Income 2,467 3,008 Change is at constant Forex Net Income increase mainly driven by higher Adjusted Earnings, a favorable change in fair value of financial assets and derivatives mainly attributable to interest rates decrease and lower restructuring costs A16 AXA Earnings August 1, 2014

17 financial performance Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A17 AXA Earnings August 1, 2014

18 L&S New business sales and margins by market In Euro million Mature markets High growth markets Total New business sales (APE) 2,773-1% 2,668 + = +7% 537 o/w Asia 1 up 12% o/w CEE 2 down 20% 513 3,310 0% 3,181 45% 48% New business margin 30% 31% + = 32% 34% A18 AXA Earnings August 1, 2014 Changes are on a comparable basis All notes are on page A39 of this document

19 L&S New business sales and margins by business Continued improvement in profitability APE (Euro million) NBV margin Net Flows (Euro billion) Business line change G/A Protection & Health 1,207-4% 55% G/A Savings % 13% o/w Euro +0.7 billion from the exceptional sales of two large Corporate pension schemes in the UK Unit-Linked 1,114 +2% 29% o/w Euro -1.1 billion from the success of the Variable Annuity GMxB buyout offer in the US Mutual funds & Other 381-1% 5% Total 3,181 0% 34% A19 AXA Earnings August 1, 2014 Changes are on a comparable basis

20 L&S Pre-tax Underlying Earnings by business Total Life & Savings 1 G/A Protection & Health G/A Savings Unit-Linked In Euro million In Euro million In Euro million In Euro million +11% 2,067 2,129 +8% 1,086 1,129 +8% +11% Higher technical margin mainly reflecting better claims experience, notably in France Higher fees and revenues in line with new business and inforce growth Higher expenses in line with commercial activity growth Higher technical margin mainly reflecting higher positive prior year reserve developments Higher investment margin reflecting lower crediting rates Lower fees and revenues + - Higher management fees in line with higher asset base following strong market performance in 2013 Lower technical margin Changes are on a comparable 2 basis A20 AXA Earnings August 1, 2014 All notes are on page A39 of this document Full detail in appendix on pages B20 to B25

21 financial performance Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A21 AXA Earnings August 1, 2014

22 P&C Revenues by segment In Euro million Total In Euro million +1% Personal lines 16,483 +2% 16,820 9,475 9,605 Average price increase of +1.7% Motor revenues up 1% Non-motor revenues up 2% * In Euro million +3% Commercial lines * 6,944 7,155 Average price increase of +2.2% Revenue growth driven by tariff increases across the board and volume increases in high growth markets * * Comparative information related to 2013 was restated for the retrospective application of the new IFRS standards on consolidation Changes are on a comparable basis A22 AXA Earnings August 1, 2014

23 P&C Price increases by country and segment +1.9% price increases on average Personal lines Price increase Revenues growth Commercial lines Price increase 1 Revenues growth 2H14 market pricing trends France +2.3% +3.4% +5.9% +5.1% Price increases likely in both Personal lines and Commercial lines Germany +4.2% +1.0% +0.3% -0.9% Stabilization in both Personal lines and Commercial lines UK & Ireland +1.9% -3.3% +3.0% +5.2% Early signs of market hardening in Motor Stabilization in SME Commercial lines Switzerland +0.7% +2.5% +0.1% +1.0% Stabilization in both Personal lines and Commercial lines Belgium +3.1% -0.8% +1.9% +1.8% Softening trends in Personal Lines Stabilization in Commercial Lines MedLA % -1.7% +1.4% +4.7% Impact of economic slowdown in Southern Europe Asia % +4.9% +0.7% +8.4% Direct +0.2% +7.0% Total +1.7% +1.2% +2.2% +3.4% Prices expected to be stable Prices expected to increase A23 AXA Earnings August 1, 2014 All notes are on page A39 of this document

24 P&C Revenues and margins by market In Euro million Mature markets High growth markets Direct Total +1% 13,073 13,349 o/w Asia +8% o/w MedLA +4% +2% 16,483 16,820 Revenues + + = +5% 2,272 2,269 +7% 1,138 1,202 * * * * Current year combined ratio 97.3% 96.8% 97.3% 97.5% % 99.7% = 97.5% -0.4 pt 97.1% * Comparative information related to 2013 was restated for the retrospective application of the new IFRS standards on consolidation A24 AXA Earnings August 1, 2014 Changes are on a comparable basis for revenues and at constant Forex for current year combined ratio

25 P&C Underlying Earnings P&C Underlying Earnings Combined ratio In Euro million Current year combined ratio + Prior year reserve developments All-year combined ratio 1,128 +9% 1, % 0.7% Price increases and lower claims frequency Lower expense ratio Higher claims severity Higher nat cat charges o/w 241m from the ELA hailstorm 97.1% 1.7% -1.8% -1.3% 95.8% 95.8% Natural Catastrophes In Euro million +12% Investment income 1,003 1,116 Higher investment yield at 4.2% vs. 3.9% in, of which +23bps from exceptional Mutual Funds dividends in France which amounted to Euro 67 million A25 AXA Earnings August 1, 2014 Changes are at constant Forex Full detail in appendix on pages B29 to B32

26 financial performance Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A26 AXA Earnings August 1, 2014

27 AM Assets under management Improving net flows Average AUM and net flows in Euro billion Revenues in Euro million Average AUM Net flows Revenues % % 563 Average AUM and net flows in Euro billion Revenues in Euro million Average AUM Net flows Revenues % ,047 +3% 1,029 A27 AXA Earnings August 1, 2014 Changes are on a comparable basis

28 AM Underlying Earnings Asset Management In Euro million 194-4% +11% on a comparable basis (excluding AXA Private Equity*) 184 In Euro million % % on a comparable basis (excluding AXA Private Equity*) In Euro million +14% * Sale of a majority stake in AXA Private Equity completed on September 30, 2013 Changes are at constant Forex A28 AXA Earnings August 1, 2014

29 financial performance Group earnings Life & Savings Property & Casualty Asset Management Balance sheet A29 AXA Earnings August 1, 2014

30 Shareholders Equity In Euro billion Shareholders equity In Euro billion Key drivers of change Change in net unrealized capital gains +4.0 Dividends Forex movements net of hedging Net income for the period Subordinated debt +0.8 * - Change in pension benefits -0.5 FY13 * Corresponds mainly to Euro 1 billion undated subordinated debt issued in May 2014 and accumulated interests charges A30 AXA Earnings August 1, 2014

31 Stable debt gearing at 24% In Euro billion Total net debt Changes in Undated subordinated debt May 2014: placement of Euro 1 billion undated subordinated notes Subordinated debt January 2014: placement of GBP 750 million subordinated notes due 2054 January 2014: redemption of Euro 2.1 billion dated subordinated debt Debt Gearing Interest Cover 2 Debt ratios FY13 24% 10.2x Ratings A+ stable 24% 11.0x as of 26/05/ Undated subordinated debt Subordinated debt 1 Senior debt Aa3 stable as of 09/05/2014 FY13 Cash AAstable as of 11/03/2014 A31 AXA Earnings August 1, 2014 All notes are on page A39 of this document

32 Economic solvency Economic solvency a Key sensitivities 206% 215% Economic Solvency ratio Ratio as of June 30, % Interest rate +100 bps 226% 50.8 FY In Euro billion Available capital Required capital Interest rate -100 bps 202% Equity markets +25% 219% Equity markets -25% 211% Corporate spreads b +75bps 213% Economic solvency roll-forward 206% +12pts -3pts 0pt 215% FY13 Operating return Market impact net of liquidity premium Business growth, forex & other a. The Economic Solvency ratio is based on AXA s internal model calibrated based on adverse 1/200 years shock and assuming US equivalence. AXA s internal model will be subject to a comprehensive review and approval process conducted by ACPR over the coming months as part of the implementation process around Solvency II which is scheduled to take effect January 1, 2016 b. Net of liquidity premium as defined in QIS 5 A32 AXA Earnings August 1, 2014

33 Asset & Liability Management (1/3) Diversified and resilient investment portfolio Real Estate 5% Investment portfolio overview 83% in Fixed income Alternative investments 1 3% Life & Savings Fixed income Assets duration as at June 30, 2014 Property & Casualty Limited yield dilution 7.2 years 5.0 years Listed equities 3% Cash 4% Other fixed income 2 7% Policy loans 1% Govies and related 46% Long asset duration leading to a slow yield dilution 4.0% 3.9% Life & Savings 3.8% 3.7% 3.7% FY10 FY11 FY12 FY13 * Corporate bonds 30% 4.0% Property & Casualty 4.0% 3.9% 3.9% Or 4.0% excluding exceptional Mutual Funds dividends 4.2% total General Account invested assets 3 : Euro 489 billion FY10 FY11 FY12 FY13 * A33 AXA Earnings August 1, 2014 * Annualized All notes are on page A39 of this document Full detail in appendix on pages B38 to B57

34 Asset & Liability Management (2/3) Limited earnings sensitivity to low interest rates environment Resilient asset yield and decreasing guaranteed rate Life & Savings General Account 4% 1% 4.0% 3.9% 3.8% 3.7% 3.7% 170bps 150bps 2.3% 2.2% 2.2% 2.2% 2.2% FY10 FY11 FY12 FY13 FY14E 150bps FY22E Asset yield 1 Average guaranteed rate Resilient investment margin 77bps 79bps * * Guidance: 70-80bps * Growing asset base Resilient investment income In Euro billion In Euro million Property & Casualty FY10 2 FY13 Resilient yield 2,035 2,042 1, % 3.9% 4.2% FY10 2 FY13 FY10 2 FY13 * * Annualized A34 AXA Earnings August 1, 2014 All notes are on page A39 of this document

35 Asset & Liability Management (3/3) Well diversified and high quality new investments New Fixed income investments in 1 Resilient reinvestment yield ABS ~3% Investment Grade credit ~51% new investments Below Investment Grade credit (mostly short duration high yield) ~10% Government bonds & related ~36% investment rate on Fixed income assets for Life & Savings and Property & Casualty entities * Eurozone 3.0% US 3.6% Japan 2.0% Switzerland 2.2% Total 2.9% Focus on credit Other loans ~11% Commercial Real Estate loans ~14% Amount invested in Fixed income in : Euro 22 billion Corporate bonds ~75% * Annualized A35 AXA Earnings August 1, 2014 All notes are on page A39 of this document

36 Table of contents Introduction & highlights Page A3 by Henri de Castries, Chairman and CEO financial performance by Denis Duverne, Deputy CEO & Gérald Harlin, Group CFO Page A10 Concluding remarks Page A36 by Henri de Castries, Chairman and CEO A36 AXA Earnings August 1, 2014

37 Concluding remarks Strong increase in earnings across the board Deliver profitable growth Topline growth on track Accelerate growth through investment in brand and digital Performing well in a low interest rate environment Maintain strong discipline in capital and risk management Delivering on Ambition AXA financial objectives Offer an attractive dividend A37 AXA Earnings August 1, 2014

38 Q&A session Q&A session A38 AXA Earnings August 1, 2014

39 Notes Page A8 1. Excluding holdings 2. Includes G/A Protection & Health, Property & Casualty and International Insurance 3. Estimated impact on Underlying Earnings from General Account only (G/A Savings, G/A Protection & Health and Property & Casualty) Page A9 1. Underlying EPS: Underlying Earnings per share; Net RCG: Net realized capital gains 2. Compound annual growth rate 3. Greek government bond impairment 4. Net of undated debt interest charges Page A11 1. Adjusted ROE: Return corresponds to adjusted earnings net of interest charges on undated debt. Equity corresponds to average shareholders equity excluding undated debt and reserves related to change in fair value 2. Average shareholders equity excluding undated debt and reserves related to change in fair value Page A13 1. Sale of a majority stake in AXA Private Equity completed on September 30, 2013 Page A14 1. Closed MONY portfolio transaction completed on October 1, 2013 Page A18 1. Excluding Japan 2. Mainly due to closing of pension fund new business in Czech Republic and Poland following changes in regulation Page A20 1. Including Mutual Funds & Other. Pre-tax Underlying Earnings for Mutual Funds & Other amounted to Euro 9 million for and Euro 49 million for 2. Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014 and (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact Page A23 1. Renewals only 2. Mediterranean and Latin American Region: Italy, Spain, Portugal, Greece, Turkey, Mexico, Morocco and Gulf region (P&C only) 3. Hong Kong, Malaysia and Singapore, on a 100% share basis Page A31 1. Including Euro -0.2 billion of reversal of mark-to-market on interest rates derivatives in HY14 vs. Euro -0.2 billion in FY13 2. Including undated debt interest charges Page A33 1. Mainly Private Equity and Hedge Funds 2. Other fixed income include Asset backed securities (Euro 8 billion), residential loans (Euro 11 billion), commercial & agricultural loans (Euro 14 billion) and agency pools (Euro 2 billion) 3. invested assets referenced in page 57 of the financial supplement are Euro 696 billion, which include notably Euro 167 billion of Unit-Linked contracts and Euro 37 billion related to the banking segment. Page A34 1. Projections assuming an average 2.9% Fixed Income reinvestment rate over the next 9 years 2. Restated for the sale of Canadian operations in 2011 Page A35 1. General Account only A39 AXA Earnings August 1, 2014

40 Definitions & Credits Definitions financial statements are subject to completion of limited review by AXA s independent auditors. AXA's results have been prepared in accordance with IFRS and interpretations applicable and endorsed by the European Commission at June 30, Adjusted earnings, underlying earnings, APE, NBV and Group operating Free Cash Flows are non-gaap measures and as such are not audited, may not be comparable to similarly titled measures reported by other companies and should be read together with our GAAP measures. Management uses these non-gaap measures as key indicators of performance in assessing AXA s various businesses and believes that the presentation of these measures provides useful and important information to shareholders and investors as measures of AXA s financial performance. For a reconciliation of underlying and adjusted earnings to net income see pages A15 and A16 of this presentation. Life & Savings New Business Value (NBV) is the value of the new business sold during the reporting period. The new business value includes both the initial cost (or strain) to sell new business and the future earnings and return of capital to the shareholder. Credits Page A37: Icons by Freepik.com are licensed under CC BY 3.0 A40 AXA Earnings August 1, 2014

41 Half Year 2014 Earnings August 1, 2014 Appendices

42 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B2 AXA Earnings August 1, 2014

43 Life & Savings Scope overview APE by geography Global footprint Well balanced business mix APE by business NORCEE 1 16% UK 12% MedLA 2 9% France 24% US 20% Unit-Linked 35% Mutual Funds & other 12% G/A Protection & Health 38% G/A Savings Strong proprietary network APE by channel Partnerships 19% Total: Euro 3,181 million 15% Agents & salaried sales force 46% Asia (incl. Japan) 20% Total: Euro 3,181 million Brokers IFAs 35% Total: Euro 3,181 million 1. Northern, Central & Eastern Europe: Germany, Belgium, Switzerland, Poland, Hungary, Czech Republic and Slovakia 2. Mediterranean and Latin American Region: Italy, Spain, Portugal, Greece, Turkey, Mexico, Morocco and Colombia B3 AXA Earnings August 1, 2014

44 Property & Casualty Scope overview Revenues by geography Global footprint Asia 8% 3% Liability Other 1 7% Direct Business Unit 1% Property 7% 23% Strong presence in Motor Revenues by business Other Construction 2% Motor 43% Switzerland 15% France 20% UK & Ireland 13% Workers Compensation 6% Total: Euro 16.8 billion Health 10% Unique proprietary networks Revenues by channel MedLA 2 22% Germany 14% Brokers IFAs & Other 47% Agents 39% Total: Euro 16.8 billion Belgium 7% Partnerships 1. Luxembourg and Central & Eastern Europe 2. Mediterranean and Latin American Region: Italy, Spain, Portugal, Greece, Turkey, Mexico, Morocco, Colombia and Gulf region 3. Sales recorded through the Direct channel include the sales of the Direct business unit and also Direct sales from other entities B4 AXA Earnings August 1, % Total: Euro 16.8 billion Direct 3 10%

45 AXA s footprint in high growth markets Life & Savings Property & Casualty APE by geography Revenues by geography Poland 5% Czech Republic 3% Philippines 3% Singapore 4% China 9% Indonesia 9% Thailand 18% Other 3% Mexico 3% Hong Kong 44% Hong Kong 8% Malaysia 6% Singapore 6% Colombia 6% Morocco 7% Gulf region 17% Ukraine 1% Mexico 30% Turkey 20% Total APE: Euro 513 million Total Revenues: Euro 2,269 million Key rankings 1 #5 Hong Kong #4 Thailand #2 Indonesia #10 Singapore #14 India #12 China #4 Philippines Key rankings1 #1 Mexico #1 Turkey #5 Gulf region #2 Singapore #7 Malaysia #1 Hong Kong #2 Colombia 2 1. Source: AXA FY13 Activity report 2. Source: Superintendencia Financiera de Colombia B5 AXA Earnings August 1, 2014

46 Asset Management Scope overview Complementary business models Product offer Multi-expert model: structured by Expertise Expertise in fixed income, equities, quantitative equities Focus on alternative investments (structured finance, private equity, real estate, funds of hedge funds) Risk-reducing, return-seeking, diversifying strategies and customized solutions Expertise in actively managed equity and fixed income strategies, as well as index strategies Growing platform of alternative and multi-asset services and solutions Institutional research and trading Distribution Separate distribution platforms for third parties & AXA insurance companies Global and integrated distribution platforms through Institutions, Retail and Private Client channels Footprint Mainly Europe US, Europe and Asia AuM Euro 582 billion as at 30/06/2014 Euro 371 billion as at 30/06/2014 B6 AXA Earnings August 1, 2014

47 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B7 AXA Earnings August 1, 2014

48 Revenues Revenues by segment In Euro million Change on a reported basis Change on a comparable basis Life & Savings 29,603 29,039-2% +2% Property & Casualty 1 16,483 16,820 +2% +2% Asset Management 1,741 1,593-9% +4% International Insurance 1,909 1,966 +3% +4% Banking & Holdings % -3% Revenues 50,029 49,705-1% +2% 1. Comparative information related to 2013 was restated for the retrospective application of the new IFRS standards on consolidation B8 AXA Earnings August 1, 2014

49 Underlying Earnings by geography 1. Northern, Central & Eastern Europe: Germany, Belgium, Switzerland, Luxembourg, Russia (P&C only) and Central & Eastern Europe (Poland (L&S only), Czech Republic, Hungary, Slovakia, Ukraine (P&C only)) 2. Mediterranean and Latin American Region: Italy, Spain, Portugal, Greece, Turkey, Mexico, Morocco, Colombia and Gulf region (P&C only) 3. Other correspond to AXA Life invest Services, Architas and Family Protect B9 AXA Earnings August 1, 2014 In Euro million Underlying Earnings Change on reported basis Change at constant Forex Life & Savings 1,534 1,651 +8% +13% United States % +45% France % +12% NORCEE % +6% UK Asia-Pacific (incl. Japan) % -4% MedLA % +2% Other % -52% Property & Casualty 1,128 1,226 +9% +9% NORCEE % +19% France % -7% MedLA % +10% UK & Ireland % 0% Asia % +20% Direct % +30% International Insurance % +31% Asset Management % -4% AllianceBernstein % +14% AXA IM % -15% Banking % +12% Holdings & other % - -12% Total 2,579 2,777 +8% +11%

50 key sensitivities P&L Balance Sheet In Euro billion Impairments net of hedges through Change 1 in fair value and Forex through Net unrealized capital gains through Adjusted Earnings Net Income Shareholders' Equity Equities -25% % Interest rates -100 bps bps Corporate spreads -75 bps bps Consists of gains/losses on derivatives and forex economic hedges not eligible for hedge accounting under IAS 39, as well as the change in fair value of assets accounted for as fair value option B10 AXA Earnings August 1, 2014

51 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B11 AXA Earnings August 1, 2014

52 Life & Savings Revenues, new business volumes and profitability Underlying earnings margin analysis Underlying earnings margin analysis by business Focus on the US Page B13 Page B14 Page B20 Page B26 B12 AXA Earnings August 1, 2014

53 1 L&S Revenues and net inflows L&S revenues by region L&S Net inflows In Euro billion Net flows by country/region In Euro billion France MedLA +10% France +4% NORCEE United States United Kingdom Asia Pacific (incl. Japan) NORCEE -4% 9.4 Asia Pacific (incl. Japan) 0% United States +5% UK +2% MedLA Total of which mature markets of which high growth markets Net flows by business In Euro billion G/A Protection & Health G/A Savings Changes are on a comparable basis Total: Euro 29.0 billion Unit-Linked Mutual funds & other Total B13 AXA Earnings August 1, 2014

54 2 L&S Underlying Earnings margin analysis In Euro million Gross Margin Expenses In Euro million Comp. Change 1 Comp. Change 1 Margin on revenues 2 2,267-2% Acquisition expenses 1,838-5% Margin on assets 2,608 +5% Admin. Expenses 1,370 +3% Technical margin % VBI amortization % UE from associates % Pre-tax underlying earnings Euro 2,129 million +11% - Tax Minority interest 49-2% 0% Underlying earnings Euro 1,651 million +15% 1. Changes are adjusted for Forex and changes related to scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in Life & Savings gross written premiums and mutual fund sales 3. Tax rate decreased from 23% in to 20% in mainly due to higher positive tax one-offs, which amounted to Euro 121 million in vs. Euro 41 million in B14 AXA Earnings August 1, 2014

55 2 L&S Margin analysis Details of margin on revenues Margin on revenues Average margin on L&S revenues 1 7.8% -0.3 pts -0.3 pt business mix Detail by product 0.0 pt country mix G/A Protection & Health: 12.6% G/A Savings: 1.6% Unit-Linked: 3.9% Mutual funds & other: 7.9% Margin on revenues 1 Euro 2,267 million -2% x Life & Savings revenues 1 Euro 29,039 million +2% Changes are on a comparable basis 1. Life & Savings gross written premiums and mutual fund fees B15 AXA Earnings August 1, 2014

56 2 L&S Margin analysis Details of margin on Unit-Linked assets Unit-Linked management fees Average management fees on Unit- Linked reserves Unit-Linked management fees x 72 bps 144 bps annualized +2 bps +2 bps business mix 0 bp country mix Euro 1,138 million +8% Margin on assets 1 Unit-Linked average reserves + Euro 2,608 million +5% Euro 158 billion +5% 1. Including other fees (mainly mutual fund and brokers fees) of Euro 156 million (+7% vs. ) General account investment margin Euro 1,314 million +2% In Euro billion Reserves as of Jan. 1, 2014 Net flows Market Forex Scope Reserves as of June 30, Changes are on a comparable basis B16 AXA Earnings August 1, 2014

57 2 L&S Margin analysis Details of margin on General Account assets Investment margin Unit-Linked management fees Euro 1,138 million +8% Margin on assets 1 + Average management fees on general account reserves Euro 2,608 million +5% 39 bps 1. Including other fees (mainly mutual fund and brokers fees) of Euro 156 million (+7% vs. ) General account investment margin x 79 bps annualized +1 bp +1 bp business mix 0 bp country mix Euro 1,314 million +2% General account average reserves Euro 334 billion -1% In Euro billion Reserves as of Jan. 1, 2014 Net flows Market Forex Scope Reserves as of June 30, Changes are on a comparable basis B17 AXA Earnings August 1, 2014

58 2 L&S Margin analysis Details of technical margin Technical margin Mortality & morbidity margin and other 1 Euro 643 million +17% Technical margin Euro 461 million +23% + GMxB Variable Annuity hedge margin In Euro million Euro -183 million -5% (vs. Euro -183 million in ) o/w basis -39 o/w volatility (equity and interest rates) -32 o/w interest rates, credit spreads & other -112 Changes are on a comparable basis 1. Claims paid, maturities and surrenders B18 AXA Earnings August 1, 2014

59 2 L&S Margin analysis Focus on gross technical margin In Euro million Gross mortality, morbidity & surrender margin (pre-tax) mortality, morbidity & surrender margin evolution mainly explained by an improved claims experience in G/A Protection & Health notably in France and Japan Gross GMxB Variable Annuity technical margin (pre-tax, pre-dac) In Euro million Stable GMxB VA technical margin (pre-tax, pre-dac) mainly in line with benign financial markets Euro -40 million net Underlying Earnings impact B19 AXA Earnings August 1, 2014

60 3 L&S Underlying Earnings by business Euro million % change 1 on comp. basis G/A Protection & Health 1,086 1,129 +8% G/A Savings % Unit-Linked % Mutual funds & Other Pre-tax Underlying Earnings 2,067 2, % Tax and Minority interest Underlying Earnings 1,534 1, % 1. Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014 and (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact B20 AXA Earnings August 1, 2014

61 3 L&S Margin analysis by business In Euro million G/A Protection & Health G/A savings Unit-Linked Mutual Funds & Other Margin on revenues Investment margin Management fees Technical Margin & Other 1, , % % of GWP 79 bps* of avge G/A reserves 144 bps* of avge UL reserves Gross margin 2, , ,335 Admin. Exp. & Other Acquistion expenses ,369-1, ,838 Pre-tax UE 1, ,129 * annualized B21 AXA Earnings August 1, 2014 Main profit drivers

62 3 L&S Margin analysis by business G/A Protection & Health Technical result Net investment margin In Euro million Comp. Change 1 In Euro million Comp. Change 1 x Protection & Health GWP 14,170 Protection & Health Combined ratio (in %) 0% 95.5% -0.5 pt Protection & Health average reserves Protection & Health investment spread 156,638 +3% 29 bps -2 bps x 58 bps annualized Net technical result % Investment margin 457-4% + + UE from associates 38 na. vs. Euro 20 million in Pre-tax underlying earnings Euro 1,129 million +8% 1. Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014, (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact and (iii) methodology used to compute G/A Protection & Health combined ratio (details on slides B23) B22 AXA Earnings August 1, 2014

63 3 L&S Margin analysis by business G/A Protection & Health Details on Combined Ratio Combined Ratio Expense Ratio pt Mainly due to Forex Expense ratio deteriorated by 0.4 point mainly reflecting commercial efforts Expense Ratio 95.5% 12.0% 95.5% 12.2% Loss Ratio 83.4% 83.3% Loss Ratio % 26.3% Loss ratio improved by 0.9 point, mainly driven by better claims experience notably in France 1. Expense ratio includes VBI amortization 2. was restated following a change in methodology in the calculation of the G/A Protection & Health combined ratio. published combined ratio amounted to 95.4% and included Underlying Earnings from associates Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014, (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact and (iii) methodology used to compute G/A Protection & Health combined ratio B23 AXA Earnings August 1, 2014

64 3 L&S Margin analysis by business G/A Savings x In Euro million G/A Savings Gross revenues Margin on G/A Savings Margin on revenues Comp. Change 1 5, % 1.6% -1.2 pt x G/A Savings Average reserves G/A Savings Investment spread Comp. Change 1 177,244-4% 45 bps +3 bps 92-37% Investment margin % + 89 bps annualized Technical margin & Other Comp. Change 66 na. (vs. Euro 14 million in ) Gross margin Euro 946 million +2% Acquisition costs % - Administrative expenses & Other % Pre-tax underlying earnings Euro 466 million +8% 1. Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014 and (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact B24 AXA Earnings August 1, 2014

65 3 L&S Margin analysis by business Unit-Linked x In Euro million Unit-Linked Gross revenues Average margin on UL revenues Margin on revenues Comp. Change 1 8,285-1% 3.9% -0.4 pt % x Unit-Linked Average reserves UL average Management fees Unit-Linked Management fees Comp. Change 1 157,607 +5% 72 bps 144 bps annualized +2 bps 1,138 +8% Technical margin & Other Comp. change % o/w GMxB VA margin % + Investment margin 45 +9% Gross margin Euro 1,336 million 0% Administrative Acquisition costs % % expenses & Other B25 AXA Earnings August 1, 2014 Pre-tax underlying earnings Euro 485 million +11% 1. Changes are adjusted for Forex and changes related to (i) scope with the closed MONY portfolio transaction in 2013 and the disposal of AXA Hungary in 2014 and (ii) methodology with the update of US investment income allocation in 2014, which has a zero net P&L impact

66 Focus on the US Continuous improvement in Variable Annuity profitability US Variable Annuity GMxB Underlying Earnings In Euro million, net of DAC and tax 1 FY12 2 FY13 Total Variable Annuity base fees & other, less expenses GMxB hedge margin o/w Basis o/w Volatility o/w Interest rates, credit spreads & other Total reserve strengthening o/w lapse experience / assumptions o/w other policyholder behavior o/w management actions including premium suspension, buyout program & model refinements/ assumptions Variable Annuity GMxB Underlying Earnings US Life & Savings Underlying Earnings In Euro million US Life & Savings APE In Euro million 32% 14% 5% 23% 25% % 11% 2% 27% 27% % Mutual funds & Other Floating rate GMxB Variable Annuity 1H12 Life Fixed rate GMxB Variable Annuity Non-GMxB Variable Annuity Change is at constant Forex Change is on a comparable basis 1. Notional tax rate of 35% 2. Comparative information related to 2012 was retrospectively restated for the amendments to IAS 19 B26 AXA Earnings August 1, 2014

67 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B27 AXA Earnings August 1, 2014

68 P&C Revenues and net new contracts In Euro billion P&C revenues by region P&C personal net new contracts In thousands Improved retention in the UK partly offset by slowdown in MedLA Direct +7% Asia +8% MedLA +1% France +4% UK & Ireland +1% Exit from partnerships in the UK NORCEE +1% Other mature markets -241 Total: Euro 16.8 billion * High growth markets Direct Mature markets Changes are on a comparable basis B28 AXA Earnings August 1, 2014 * Comparative information related to 2013 was restated for the retrospective application of the new IFRS standards on consolidation

69 P&C Underlying Earnings analysis Net technical result Net investment income In Euro million Comp. Change In Euro million Comp. Change x Revenues 16,820 +2% Average P&C assets 57,152 +1% Combined ratio 1 (in %) 95.8% +0.2 pt Average Asset Yield 3 3.9% 1. Combined ratio calculated based on gross earned premiums 3. Net of interests credited to P&C reserves relating to annuities. Gross asset yield w as 4.2% * * +11% x Net technical result % Net investment income 1, % 2. Technical result net of expenses Pre-tax underlying earnings Euro 1,747 million % UE from associates % Tax % - 4. Tax rate stable at 29% Minority interest % * Annualized Underlying earnings Euro 1,226 million +9% Changes are on a comparable basis for activity indicators (constant Forex, scope and methodology), and at constant Forex for earnings. B29 AXA Earnings August 1, 2014

70 P&C Details on Combined Ratio Expense Ratio roll-forward Combined Ratio 26.2% 25.9% -0.3 pt 0.0 pt 95.8% 95.8% Expense Ratio 26.2% 25.9% Acquisition expenses Administrative expenses -0.4 pt change on a comparable basis Loss Ratio 69.5% 69.9% Loss Ratio roll-forward 69.5% +1.0 pts +0.5 pt 69.9% 26.8% 26.3% -1.1 pts Current accident year Nat Cat Prior year reserve dev pt change on a comparable basis B30 AXA Earnings August 1, 2014

71 P&C Focus on reserve developments Prior year reserve development level (in % of gross earned premiums) 5.4% 6.0% 5.4% 4.5% 0.3% 0.9% 1.4% 2.7% 3.1% 2.0% 2.1% 1.7% 1.8% 1.2% 1.2% 1.3% FY04 FY05 FY06 FY07 FY08 1H09 FY09 1H10 FY10 1H11 FY11 1H12 FY12 FY13 Reserving ratio (Net technical reserves/net earned premiums) 193% 193% 186% 194% 187% 198% 187% 199% 186% 196% 187% 195% 186% 195% 185% 199% FY04 FY05 FY06 FY07 FY08 1H09 FY09 1H10 FY10 1H11 FY11 1H12 FY12 FY13 Note: FY04 to FY09 figures do not exclude Canadian operations B31 AXA Earnings August 1, 2014

72 P&C Details on current year loss ratios Personal Motor Personal non motor 74.4% +0.5pt -0.4pt -0.7pt +0.9pt 74.6% 63.3% +1.4pts +0.6pt +0.8pt 64.2% -2.0pts CY loss ratio Nat Cat Price effect Frequency & severity Other 1 1 CY loss ratio CY loss ratio Nat Cat Price effect Frequency & severity Other CY loss ratio Total commercial lines incl. Construction & Work. Comp. Total P&C +0.7pt 74.2% +0.8pt +1.0pt -1.3pts -1.0pt 73.4% 71.3% -1.1pts +0.2pt -0.2pt 71.2% CY loss ratio Nat Cat Price effect Frequency & severity Other 1 CY loss ratio CY loss ratio Nat Cat Price effect Frequency & severity Other 1 CY loss ratio 1. Other includes opening adjustments, changes in mix, claims handling costs, reinsurance impact excl. Nat Cat, other changes in reserves, Forex and scope B32 AXA Earnings August 1, 2014

73 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B33 AXA Earnings August 1, 2014

74 AM - Underlying Earnings Details of Asset Management margin analysis Margin* Expenses* In Euro million Change** In Euro million Change** Asset Management fees 1,452 +5% Asset Management expenses 1,076-2% Distribution revenues % Investment result -8-34% Distribution expenses % Pre-tax underlying earnings Euro 368 million -4% Tax % * Margin and expenses are calculated gross of intercompany eliminations to help reconcile with disclosure on page 21 of Financial Supplement ** Changes are on a comparable basis for activity indicators (constant Forex, scope and methodology), and at constant Forex for earnings Underlying earnings Euro 184 million - -4% Minority int.& other 78 +6% 1. Tax rate down from 31% in to 29% in B34 AXA Earnings August 1, 2014

75 AM Underlying Earnings Details on Asset Management revenues Asset Management fees on Average Assets under Management Asset Management fees 33 bps * +1 bp * Euro 1,452 million +5% x Average Assets under Management o/w perfomance fees Euro 45 billion ( +42% ) o/w reserch fees Euro 177 billion ( +8% ) Euro 894 billion +3% In Euro billion AUM as of Jan.1, Net inflows +14 o/w AllianceBernstein +3 o/w AXA IM +11 Market & other +39 Forex +7 Scope 0 AUM as of June 30, Changes are on a comparable basis * Annualized B35 AXA Earnings August 1, 2014

76 Table of content Business overview Group Life & Savings Property & Casualty Asset Management Balance sheet B36 AXA Earnings August 1, 2014

77 Balance sheet 1 General accounts invested assets 1.1 Government bonds & related 1.2 Corporate bonds 1.3 CDS 1.4 ABS 1.5 Equity 1.6 Real Estate 1.7 Hedge Funds 1.8 Private Equity 1.9 Mortgage loans Page B38 page B39 page B40 page B43 page B44 page B48 page B50 page B51 page B52 page B Focus on net unrealized capital gains 2.1 Focus on exposure to Eurozone peripheral countries Asset Liability Management Solvency Net financial debt Page B54 page B55 Page B56 Page B58 Page B61 B37 AXA Earnings August 1, 2014

78 1 General Account invested assets Invested assets (100%) in Euro billion FY13 % % Changes in asset mix Fixed income % % o/w Govies and related % % o/w Corporate bonds % % o/w Asset backed securities 10 2% 8 2% o/w Mortgage loans & other % 26 5% Net inflows, investment income and maturities: invested mainly in corporate and government bonds Mark to market: positive impact on fixed income assets from interest rates decrease Cash 20 4% 21 4% Listed equities 18 4% 17 3% Real Estate 24 5% 25 5% Alternative investments % 16 3% Policy loans 5 1% 5 1% Total Insurance Invested Assets % % 1. Mortgage loans & other include residential loans (Euro 11 billion), commercial & agricultural loans (Euro 14 billion) and Agency Pools (Euro 2 billion) 2. Mainly Private Equity and Hedge Funds 3. invested assets referenced in page 57 of the financial supplement are Euro 696 billion, which include notably Euro 167 billion of Unit-linked assets and Euro 37 billion related to the banking segment B38 AXA Earnings August 1, 2014

79 1.1 Government bonds and related Breakdown by geography Breakdown by segment Other 2 The Netherlands 2% Supranational Institutions 2% Austria 3% US 6% Ireland 2% Other 7% France 19% P&C 11% 1% L&S 87% Spain 6% Switzerland 7% Germany 15% In Euro billion Gross 1 unrealized capital gains and losses 29.9 Italy 10% Japan 10% Belgium 11% 17.3 As of June 30, 2014 Total: Euro 226 billion FY13 1. Gross of tax and policyholders participation 2. Other includes International Insurance and Holdings segments B39 AXA Earnings August 1, 2014

80 1.2 Corporate bonds Breakdown by industry Breakdown by segment Technology 2% Basic materials 5% Other 2% P&C 15% Other 2 2% Energy 6% Consumer cyclical 6% Industrial 7% Banks 32% Gross 1 unrealized capital gains and losses L&S 83% Utilities 9% In Euro billion Communications 9% Other financials 10% Consumer non-cyclical 12% 5,6 8,2 As of June 30, 2014 Total: Euro 147 billion FY13 1. Gross of tax and policyholders participation 2. Other includes International Insurance and Holdings segments B40 AXA Earnings August 1, 2014

81 1.2 Focus on banking corporate bonds As of June 30, 2014 Gross market value in Euro billion Senior debt Secured Non secured Lower Tier 2 Subordinated debt Upper Tier 2 Tier 1 Preferred France United States UK Spain Germany Australia Italy Netherlands Sweden Switzerland Canada Norway Other Total TOTAL More than 30 countries B41 AXA Earnings August 1, 2014

82 1.2 Corporate bonds breakdown by country and rating (including CDS) P = Participating NP = Non-participating in Euro billion France US Belgium Germany Switzerland Japan Other 1 Total As of June 30, 2014 P NP P NP P NP P NP P NP NP P NP P NP AAA AA A BBB Below investment grade Non rated Total Including UK, MedLA, Asia Pacific (excl. Japan), CEE, Direct P&C excluding Direct Japan B42 AXA Earnings August 1, 2014

83 1.3 Focus on CDS CDS mainly used as alternative to investment grade corporate bonds Net CDS exposure excluding NBT strategy mainly corresponds to an overlay strategy (synthetically replicate corporate bonds by selling CDS on top of government bonds to enhance return) NBT strategy: buy credit derivatives on corporate names to form negative basis trade CDS also used to get liquid exposure to local sovereign risks Corporate bonds Government bonds and related in Euro billion Net CDS exposure excl. NBT strategy Net notional as of June 30, 2014 NBT strategy Net notional as of June 30, 2014 Total Net notional as of June 30, 2014 Total Net notional as of June 30, 2014 AAA AA A mainly Ireland, Italy and Spain BBB Below investment grade Non rated Total Represents total market value of Euro -102 million B43 AXA Earnings August 1, 2014