Tryg A/s · OMXCOP:TRYG
Tryg A/s — FY2013 Earnings Presentation
23 slides from Tryg A/s's earnings presentation, Jan 30, 2014
Slide 1: 2013 results
2013 results Webcast presentation 30 January 2014 Follow us on Twitter: @TrygIR 1
Slide 2: Disclaimer
Disclaimer Certain statements in this presentation are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward-looking statements (other than statements of historical fact) regarding our future results of operations, financ
Slide 3: Highlights Q4 2013
Highlights Q4 2013 - Result affected by storms and a strong investment result Pre-tax profit • Pre-tax profit of DKK 639m (DKK 638m). D KKm 800 Technical result declined 15.7% to DKK 546m 638 639 (DKK 648m). 600 400 • Combined ratio of 89.1 compared to 87.4 200 impacted by windstorms ~ 45,000 claims
Slide 4: Highlights 2013
Highlights 2013 - Result affected by efficiency initiatives, high level Pre-tax profit of weather claims and high investment result D KKm 3,200 3,017 2,993 2,800 2,400 • Proposed dividend per share of DKK 27. 2,000 1,600 1,200 800 • Return on equity of 21.5% (22.1%) after tax. 400 0 2012 2013 Combin
Slide 5: Important news in Q4 2013
Important news in Q4 2013 • Windstorms with more than 45,000 claims. Sideways coverage “in the money” in H1 2014. • New price differentiated products: • Van insurance in Denmark • House and car in Norway • Boat in Sweden • Efficiency programme progress as planned. DKK 112m reached in Q4. • New IT ag
Slide 6: Combined ratio development in business areas
Combined ratio development in business areas Combined ratio – Private (DK & NO) Combined ratio – Commercial (DK & NO) 100 100 95 95 92.2 90 87.7 87.7 90 87.9 86.8 86.0 82.6 83.7 85 85 80 80 75 75 70 70 Q4 2012 Q4 2013 2012 2013 Q4 2012 Q4 2013 2012 2013 Group CR Q4 2013: 89.1 Q4 2012: 87.4 2013: 87.
Slide 7: Strategic initiatives 2013 and 2014
Strategic initiatives 2013 and 2014 2013 Fixing the engine room 2014 Customers, culture and continious improvements Increased price differentiation Increased price differentiation Commercial back on track Customer journey & success culture Building foundation in Sweden Expenses/claims reductions Exp
Slide 8: Follow up on efficiency programme
Follow up on efficiency programme • Savings of DKK 557m achieved so far. DKKm Targeted and achieved savings on claims • DKK 112m achieved in Q4 2013. 100 120 300 700 Q4: 90m • Increased benefit from use of Scalepoint. 250 Q1-Q3: 210m • Agreements based on fixed prices on materials and repairs. 250 •
Slide 9: Expense ratio development
Expense ratio development • Significant reduction in expense ratio from 16.4 in 2012 to 15.6 in 2013. Expense ratio • Nominal costs on Group level reduced from DKK 3,295m in 2012 to DKK 3,008m in 2013. • Number of manager reduced by 10%. 16.6 16.7 16.6 16.4 • Reduced number of offices. • Outsourcing
Slide 10: Premiums and portfolio
Premiums and portfolio 10
Slide 11: Topline and technical result
Topline and technical result Gross earned premiums, DKKm Technical result, DKKm 22,000 20,314 2,492 19,504 2,900 2,496 20,000 1654 18,000 1587 102 2,400 149 16,000 5,258 5,041 650 573 14,000 1,900 12,000 3,687 604 439 3,528 1,400 10,000 8,000 6,000 900 9,733 9,366 1,233 1,335 4,000 400 2,000 0 -100
Slide 12: Customer retention
Customer retention Private 92% 90% 88% 86% 84% 82% Q1 09 Q4 09 Q 3 10 Q 2 11 Q 1 12 Q 4 12 Q 3 13 Commercial 92% 90% 88% 86% 84% 82% Q 1 09 Q 4 09 Q 3 10 Q 2 11 Q 1 12 Q 4 12 Q 3 13 12
Slide 13: Private – average premiums
Private – average premiums House insurance – average premium (index 2008 = 100) Average premiums increase Y/Y 150 1.2% 2.8% 140 130 120 110 100 90 2008 2009 2010 2011 2012 2013 Motor insurance – average premium (index 2008 = 100) Average premiums increase Y/Y 140 -0.7% 2.5% 130 120 110 100 90 2008 2
Slide 14: Private Sweden – CR and customer retention
Private Sweden – CR and customer retention Private - retention rate 74% 72% 70% 68% 66% Nordea portfolio 64% 62% 60% Q3-08 Q2-09 Q1-10 Q4-10 Q3-11 Q2-12 Q1-13 Q4-13 130 125 125 120 114 115 110 110 105 103 103 102 99 99 100 97 95 95 94 95 91 90 88 88 88 85 80 Q1-10 Q4-10 Q3-11 Q2-12 Q1-13 Q4-13 14
Slide 15: Claims
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Slide 16: CR and claims ratios 2012-13
CR and claims ratios 2012-13 • Underlying development is adjusted for: Underlying claims, net 2012 / 2013 • Large claims • Weather claims 80.1 79.9 73.7 75 73.4 74.9 • Run-off and interest 74.5 71.7 68.2 68.5 • Improved underlying claims ratio on Group level driven by efficiency programme 2012 2013
Slide 17: Large claims, weather claims and run-off
Large claims, weather claims and run-off Large claims, net DKKm Weather claims, net DKKm Expected annual level 2013: DKK 450m 500 Expected annual level 2013: DKK 500m 600 400 300 400 4 71 620 200 407 418 200 3 56 2 16 100 51 112 0 0 Q4 2012 Q4 2013 2012 2013 Q4 2012 Q4 2013 2012 2013 Large claims –
Slide 18: Investment, capital and financial targets
Investment, capital and financial targets 18 29 januari 2014
Slide 19: Investment result 2013
Investment result 2013 Assets Return in 2013 Assets Gross investment return Return DKKm Bonds (1.2%) 472 Match Equities (23.4%) 564 Real estate (3.9%) 80 DKK 30.0bn Total (2.5%) 1,116 Match Mismatch DKK 40m Free Free investment DKK Result DKK 891m Return 7.5% 13.0bn 19
Slide 20: Capital position and structure
Capital position and structure Capital development 2012 to 2013 12,000 2,369 1.656 33 • Strong capital position based on 800 10,000 800 2,162 Individual Solvency (IS) with buffer of 8,000 2,422 3,212 50% (2012: 38%) impacted by: 6,000 4,000 6,410 6,366 8,530 • Suggested cash dividend 2,000 0 • 2013
Slide 21: Financial targets
Financial targets ROE after tax of 20% to be achieved by delivering a full year combined ratio of 90 or lower. Expense ratio <15 in 2015 ROE after tax 40% 30% ROE target 20% 10% 0% 03 04 05 06 07 08 09 10 11 12 13 14 15 20 20 20 20 20 20 20 20 20 20 20 20 20 21
Slide 22: Q/A
Q/A Follow us on Twitter: @TrygIR 22 29 januari 2014
Slide 23: Upcoming roadshows
Upcoming roadshows Date Place Participants from Tryg Arranged by Morten Hübbe, CEO Tor Magne Lønnum, CFO 30/01/2014 Copenhagen SEB Lars Bonde, Group EVP and COO Investor Relations Tor Magne Lønnum, CFO 31/01/2014 Oslo, Norway DnB NOR Peter Brondt, IR Manager Tor Magne Lønnum, CFO 3-4/02/2014 London