Suncorp Group (ASX: $SUN) 1H24 Financial Results Overview

Suncorp Group Limited (ASX: $SUN) has reported its 1H24 financial results, with a 5.4% increase in Group net profit after tax (NPAT) to $582 million and a 13.8% rise in cash earnings to $660 million. The company also saw a significant improvement in net investment returns, reaching $396 million, up from $167 million in the prior corresponding period. Suncorp welcomed the Australian Competition Tribunal's decision to grant authorisation of the proposed sale of Suncorp Bank to Australia and New Zealand Banking Group (ANZ), with completion expected around the middle of calendar year 2024. Additionally, the Group has adopted AASB 17, the new international accounting standard for insurance contracts, from 1 July 2023, with comparative periods restated to reflect this application.

Executive Commentary on 1H24 Financial Results

Suncorp Group CEO Steve Johnston highlighted the challenging half for customers and the Group amid ongoing inflationary pressures and the impact of severe weather events. He emphasized the improved earnings driven by increased customer demand for products and services, and positive investment performance. Johnston also noted the strong premium growth in the Australian and New Zealand general insurance businesses, reflecting customer growth across home and motor portfolios. He expressed the company's commitment to supporting customers impacted by severe weather events and the progress towards the proposed sale of Suncorp Bank to ANZ Banking Group.

Summary of 1H24 Financial Results and Outlook

Suncorp Group's 1H24 financial results demonstrated improved earnings driven by increased customer demand and positive investment performance. The company reported a 5.4% rise in Group NPAT to $582 million and a 13.8% increase in cash earnings to $660 million. The General Insurance business saw gross written premium (GWP) growth of 16.3%, reflecting customer growth and targeted price increases in response to higher reinsurance costs, inflationary pressures, and natural hazard experience. Suncorp remains committed to its strategic targets, including delivering a growing business with a sustainable return on equity above the through-the-cycle cost of equity. The Group's outlook for FY24 includes expectations of GWP growth in the low to mid-teens, a target underlying insurance trading ratio, and continued active capital management. Suncorp also anticipates the completion of the proposed sale of Suncorp Bank to ANZ around the middle of 2024, with a commitment to returning excess capital to shareholders following completion.