Allianz Group had a successful year in 2018 meeting its performance targets in all segments and maintaining a high level of capital strength. The achievement of our Renewal Agenda objectives has laid the foundation for this very good performance. Based on preliminary figures internal revenue growth, which adjusts for currency and consolidation effects, amounted to 6.1 percent, and was supported by all operating business segments.
Total revenues grew 3.5 percent to 130.6 (2017: 126.1) billion euros. With the increase of 3.7 percent, the operating profit of 11.5 (11.1) billion euros is in the upper end of the Group’s announced target range of 10.6 to 11.6 billion euros and the highest in our history. Operating profit growth was mostly attributable to our Property-Casualty business segment, which reported a strong rise in operating profit of 13.3 percent. This was due to an improved expense ratio, lower claims from natural catastrophes, and premium growth. Our Asset Management business segment also saw an increase in operating profit due to a rise in assets under management (AuM) driven revenues. As a result of a lower investment margin amidst higher financial market volatility, our Life/Health business segment operating profit decreased.
Net income attributable to shareholders grew 9.7 percent to 7.5 (6.8) billion euros. An increased operating profit and lower income taxes more than offset the decline in our non-operating result.
Basic Earnings per Share (EPS) increased 14.4 percent to 17.43 (15.24) euros for the year 2018. Return on Equity (RoE) amounted to 13.2 percent (11.8 percent). The Solvency II capitalization ratio amounted to 229 percent at end-2018, unchanged compared to end-2017. The Board of Management will propose a dividend of 9 euros per share for 2018, up 12.5 percent compared to 2017.
Allianz continued to improve customer experience in 2018. 74 percent of businesses worldwide achieved a Net Promoter Score (NPS) above market average compared to 60 percent in the previous year. The Inclusive Meritocracy Index (IMIX), which measures leadership and performance culture, was at 71 percent in 2018, close to our target level of 72 percent. These measures reflect Allianz's efforts to serve customers and engage employees in the best possible way.
“I am very proud of the global Allianz family for delivering such a great set of results. We reached the highest net income of the past ten years despite strong market volatility, especially in the fourth quarter,” said Oliver Bäte, Chief Executive Officer of Allianz SE. “Our customers continue to rely on us, and it’s with them in mind that we are focusing on simplicity in the next iteration of our strategy.”
In the fourth quarter of 2018, operating profit amounted to 2.8 (2.8) billion euros: a higher operating profit from our Property-Casualty business segment was mostly offset by a decline in our Life/Health and Asset Management business segments. The increase in the operating profit from our Property-Casualty business segment was mostly due to a higher investment result. Our Life/Health business segment operating profit declined mainly due to a lower technical margin in France. The decrease in operating profit from our Asset Management business segment was mostly driven by lower performance fees. Net income attributable to shareholders increased by 18.9 percent to 1.7 (1.4) billion euros in the fourth quarter of 2018 due to an improved non-operating result and lower income taxes.
“Allianz achieved excellent results in 2018 with operating profit of 11.5 billion euros, reaching the upper end of the Group’s announced target range of 10.6 to 11.6 billion euros,” said Giulio Terzariol, Chief Financial Officer of Allianz SE. “Our healthy and well-diversified business makes us confident that we will continue to deliver a strong financial performance again this year. The Group looks to generate an operating profit of 11.5 billion euros in 2019, plus or minus 500 million euros, barring unforeseen events.”