Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — Non-Deal Roadshow (April 2009)
53 slides from Vienna Insurance's roadshow presentation, Apr 7, 2009
Slide 1: V.I.G. – A Solid Ship in a Stormy Market
V.I.G. – A Solid Ship in a Stormy Market Prague Roadshow – 07 April 2009
Slide 2: Disclaimer
Disclaimer 2 This information does not represent an offer or invitation to purchase securities of WIENER STÄDTISCHE Versicherung AG Vienna Insurance Group (“VIG”). Any subscription orders received prior to the public offering will be refused. Any public offer will only be made pursuant to and on the
Slide 3: Contents
Contents A 3 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 4: Investment Proposition at a Glance
Investment Proposition at a Glance V.I.G. set two strategic milestones A 4 Footprint Milestone 1 § V.I.G. - Pioneer in CEE; start of expansion in 1990 - “Big fish in a small pond” - Going east immediately after the fall of the iron curtain due to potential of emerging markets and geographic proximit
Slide 5: V.I.G. Management Approach
V.I.G. Management Approach Success in CEE is based on three cornerstones A 5 Steering Approach Multi-Brand Multi-Channel § Each board member of VIG parent has direct responsibility for CEE countries Tied agents § V.I.G. board members closely Brokers Banks Other involved in management of subsidiaries
Slide 6: Management – The Czech Example
Management – The Czech Example Multi-brand & multi-channel provide best customer access A 6 Multi-Brand Multi-Channel § Founded in 1990/91, largest Tied agents V.I.G. CEE subsidiary Brokers Banks Other § Second largest insurer in CZ Kooperativa üüüü CPP ü üü § Acquisition in 2005 PCS1 ü § Cooperatio
Slide 7: V.I.G. – A Leading Insurer in CEE
V.I.G. – A Leading Insurer in CEE No. 1 position in its core markets A 7 Total Market Share in CEE1 Market Share in CEE1 Non-life 18.9% 14.9% 13.8% 14.0% 10.5% 10.5% 5.7% 5.8% 4.8% 4.7% 4.6% 4.9% 2.9% 2.4% 2.1% 1.9% 1.0% 0.4% 0.3% 0.1% KBC VIG ING AIG KBC VIG AIG Aviva Uniqa Aegon Allianz Uniqa Aviv
Slide 8: A Solid Ship in a Stormy Market
A Solid Ship in a Stormy Market V.I.G.’s main features A 8 Strong profitable growth and attractive shareholder returns First-mover advantage in CEE with strong Comprehensive Innovative products distribution market share and under continuing network with power to shape insurance demand diversified sa
Slide 9: Contents
Contents B 9 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 10: V.I.G. Business Model Still in Place (I)
V.I.G. Business Model Still in Place (I) GDP growth and underpenetration are insurance drivers B 10 1998 Growth Markets Mature Markets Insurance Density (USD) 1,000 CRO Emerging Markets PL H RO Insurance demand BG SK CZ also strongly driven by UA SER TR catch-up process 0 1,000 10,000 GDP per Capita
Slide 11: V.I.G. Business Model Still in Place (II)
V.I.G. Business Model Still in Place (II) Catch-up potential in CEE in Non-life and Life B 11 Insurance Density 2007 Proportion of NL & L in CEE Markets 3,668 Life Non-life Non-life 2,621 58% 53% 54% NL 73% 65% 61% Life 35% 83% 79% 80% L 44% 55% 55% 49% 59% 73% 85% 81% 90% 17% 21% 20% 27% 35% 39% 42
Slide 12: Contents
Contents C 12 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 13: Cooperation with Erste Group (I)
Cooperation with Erste Group (I) Mutuality beyond acquisition of insurance operations C 13 s Versicherung Group Total Premiums (€mn) Austria Premiums (€mn) CEE1 Premiums (€mn) (unconsolidated, unaudited) (unconsolidated, unaudited) (unconsolidated, unaudited) 12.4% 1,450 1,289 809 11.0% 898 481 14.8
Slide 14: Cooperation with Erste Group (II)
Cooperation with Erste Group (II) Building on existing mutual cooperation C 14 Mutuality in cooperation creates win-win situation for both partners § Similar mindset and corporate culture § Existing exemplary P&C cooperation with Erste Bank in Austria and CEE The Czech example: § Kooperativa became
Slide 15: New Business Initiatives (I)
New Business Initiatives (I) Combined forces of know-how and distribution C 15 Joint Venture § Leading legal expenses insurance Group worldwide § A leading insurance Group in CEE § More than 70 years of experience in legal expenses § Enormous distribution power insurance § GWP of about € 1.4bn, 3,40
Slide 16: New Business Initiatives (II)
New Business Initiatives (II) Upcoming demand for private health insurance in CEE C 16 Health Business in CEE Market Potential V.I.G. exploits further growth V.I.G. Market Potential potential in CEE § Health business as new business line in CEE Market § Start of sales promotion in CZ; thereafter ste
Slide 17: VIG RE – Update
VIG RE – Update Progressing ahead of business plan C 17 VIG RE – Development Key Considerations § To leverage longstanding market knowledge and strong CEE footprint – incorporated in € 300mn Czech Republic € >280mn § Pooling of V.I.G. reinsurance volume in order to avoid inefficiencies € 200mn § VIG
Slide 18: Contents
Contents D 18 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 19: Reinforced Financial Performance
Reinforced Financial Performance Efficiency programme and capitalisation D 19 Action Programme Capital Position External and internal benchmarking § Capital kept stable since SPO 2008 analysis shows cost savings potential of at least € 100mn § S&P rating of A+ recently confirmed § V.I.G. intends to
Slide 20: Diversification (I)
Diversification (I) Basis of business origination substantially widened D 20 GWP by Geography YE 05 GWP by Geography YE 08 Other CEE Other 5.5% Other Romania 2.5% Other CEE 2.7% 2.7% 6.3% Poland Romania 1.5% 7.7% Austria Austria Slovakia 63.3% 47.5% 6.6% Poland 10.1% Czech Slovakia Republic 7.7% 17.
Slide 21: Diversification (II)
Diversification (II) YE 2008 investment split – V.I.G. follows a prudent risk policy D 21 Investment policy Portfolio Overview Other Cash & Deposits BBB AAA Alternative Inv. ~2% § More than 50% of real estate with ~ 2% ~ 7% ~7% ~21% regulated Austrian housing Affiliated societies; remainder also lar
Slide 22: Contents
Contents E 22 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 23: YE 2008 Financial Highlights (I)
YE 2008 Financial Highlights (I) Excellent top and bottom line performance E 23 GWP Profit before Tax 14.3% 23.7% 541 7,899 6,912 437 5,882 5,008 321 240 2005 2006 2007 2008 2005 2006 2007 2008 IFRS IFRS Net Profit after Tax and Minorities Combined Ratio (net) 30.7% 96.9 96.4 409 95.5 313 261 94.3 1
Slide 24: YE 2008 Financial Highlights (II)
YE 2008 Financial Highlights (II) E 24 EPS ROE before Tax (%) 3.41 2.98 21.9 2.48 18.0 2.27 14.8 14.3 2005 2006 2007 2008* 2005 2006 2007 2008* * Diluted for SPO IFRS * Diluted for SPO IFRS
Slide 25: Dividend
Dividend Attractive bonus dividend almost doubles original plan E 25 Development of Dividend Comments § Basis dividend for 2008 kept EPS stable at € 1.1 per share Dividend/share Bonus dividend/share 3.41 § Bonus dividend of 90 Cents per 2.98 share as a reward for loyal shareholders and those joining
Slide 26: 2M 2009 Business Trend
2M 2009 Business Trend Preliminary GWP for 2M 2009 (local FX, mn, unconsolidated, unaudited) E 26 Non-life Life Total 2M 2009 2M 2008 +/-% 2M 2009 2M 2008 +/-% 2M 2009 2M 2008 +/-% Austria 536.8 523.9 2.5% 340.7 262.0 30.0% 877.5 786.0 11.7% Czech Rep. 6,397.1 6,010.0 6.4% 2,507.2 1,513.2 65.7% 8,90
Slide 27: Outlook
Outlook Current market volatility constrains forecasts E 27 V.I.G.'s Path of Profitability Outlook § Persistently shaky situation of 9,000 600 capital markets does not allow for 8,000 GWP firm establishment of targets for PBT 500 2009 and medium term 7,000 PBT in €mn GWP in €mn 6,000 400 § V.I.G. st
Slide 28: Appendix
Appendix F 28 A Investment proposition B Growth potential in CEE and Austria C Business initiatives D Reinforced performance E YE 2008 results – highlights and dividend F Appendix
Slide 29: YE 2008 Income Statement
YE 2008 Income Statement IFRS (€mn) F 29 YE 2008 YE 2007 +/-% 1. Gross written premiums 7,898.9 6,911.9 14.3 2. Net earned premiums 6,961.6 5,941.7 17.2 3. Net investment income 918.1 1,002.6 -8.4 4. Other income 127.5 52.0 >100 Total income 8,007.2 6,996.3 14.4 6. Expenses for claims incurred -5,60
Slide 30: YE 2008 Balance Sheet
YE 2008 Balance Sheet IFRS (€mn) F 30 YE 2008 YE 2007 +/- % Intangible assets 1,649 525 >100 Total investments 24,548 20,171 21.7 Unit- and index-linked investments 3,602 3,066 17.5 Reinsurers’ share in technical provisions 1,222 1,187 3.0 Receivables 1,500 1,200 25.0 Deferred tax assets 131 34 >100
Slide 31: YE 2008 P&L Major Items – Gross Written Premiums
YE 2008 P&L Major Items – Gross Written Premiums Sustained strong premium growth in CEE (€mn) F 31 Non-Life Life Total 218.1 YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 251.2 2,965.4 3,925.0 Other Austria 1,883.4 1,793.7 1,872.4 1,901.6 3,755.7 3,695.4 CEE Czech Rep. 982.8 838.1 437.0 292.3 1,41
Slide 32: YE 2008 P&L Major Items – Expenses for Claims Incurred
YE 2008 P&L Major Items – Expenses for Claims Incurred Loss ratio stable despite one-off effects in RO, SK F 32 § Group loss ratio (net) at 64.5% (from 64.2% in § Poland improving by 2.3% pts to 57.6% due to YE 2007 ) effective claims and risk management and benign motor pricing § Austrian loss rati
Slide 33: YE 2008 P&L Major Items – Operating Expenses
YE 2008 P&L Major Items – Operating Expenses Cost ratio slightly up due to higher share of CEE business F 33 § Group cost ratio (net) increasing by 0.7% pts § Cost ratio in Slovakia down by 2.1% pts at to reach 31.9% impacted by higher share of 37.5% due to strict cost management and CEE business in
Slide 34: YE 2008 P&L Major Items – Net Investment Income
YE 2008 P&L Major Items – Net Investment Income One-off gains balanced by market downturn (€mn) F 34 Detail - Income P&C Life Health Total in € '000 YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 Current income 210,601 146,290 1,025,645 828,298 39,271 30,249 1,275,517 1,004,837 Inco
Slide 35: YE 2008 P&L – Business Segments (P&C)
YE 2008 P&L – Business Segments Property & Casualty, IFRS (€mn) F 35 YE 2008 YE 2007 +/-% 1. Gross written premiums 4,278.9 3,671.2 16.6 2. Net earned premiums 3,375.4 2,746.8 22.9 3. Net investment income 307.0 148.5 >100 4. Other income 77.9 35.3 >100 Total income 3,760.3 2,930.5 28.3 6. Expenses
Slide 36: YE 2008 P&L – Business Segments (Life)
YE 2008 P&L – Business Segments Life, IFRS (€mn) F 36 YE 2008 YE 2007 +/-% 1. Gross written premiums 3,305.7 2,934.2 12.7 2. Net earned premiums 3,272.9 2,889.4 13.3 3. Net investment income 598.5 838.0 -28.6 4. Other income 49.6 16.7 >100 Total income 3,920.9 3,744.1 4.7 6. Life benefits -3,171.9 -
Slide 37: YE 2008 P&L – Business Segments (Health)
YE 2008 P&L – Business Segments Health, IFRS (€mn) F 37 YE 2008 YE 2007 +/-% 1. Gross written premiums 314.3 306.6 2.5 2. Net earned premiums 313.3 305.5 2.6 3. Net investment income 12.7 16.1 -21.5 4. Other income 0.0 0.0 0.0 Total income 326.0 321.7 1.4 6. Expenses for claims incurred -259.7 -266.
Slide 38: YE 2008 P&L - Split by Regions (I)
YE 2008 P&L - Split by Regions (I) Regional segments, IFRS (€mn) F 38 Austria Czech Republic YE 2008 YE 2007 +/-% YE 2008 YE 2007 +/-% 1. Gross written premiums 3,755.7 3,695.4 1.6 1,419.7 1,130.5 25.6 2. Net earned premiums 3,409.3 3,304.5 3.2 1,189.5 919.0 29.4 3. Net investment income 732.7 848.4
Slide 39: YE 2008 P&L - Split by Regions (II)
YE 2008 P&L - Split by Regions (II) Regional segments, IFRS (€mn) F 39 Slovakia Poland Romania YE 2008 YE 2007 +/-% YE 2008 YE 2007 +/-% YE 2008 YE 2007 +/-% 1. Gross written premiums 605.6 494.5 22.5 795.1 543.1 46.4 608.2 413.5 47.1 2. Net earned premiums 523.2 398.8 31.2 747.5 483.9 54.5 528.2 31
Slide 40: YE 2008 P&L - Split by Regions (III)
YE 2008 P&L - Split by Regions (III) Regional segments, IFRS (€mn) F 40 Other CEE Other TOTAL YE 2008 YE 2007 +/-% YE 2008 YE 2007 +/-% YE 2008 YE 2007 +/-% 1. Gross written premiums 496.4 383.8 29.3 218.1 251.2 -13.2 7,898.9 6,911.9 14.3 2. Net earned premiums 378.8 300.3 26.1 185.0 220.3 -16.0 6,9
Slide 41: YE 2008 Results by Country
YE 2008 Results by Country IFRS (€mn) F 41 Non-Life Life Total Profit before Tax Combined Ratio YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 YE 2008 YE 2007 Austria 1,883.4 1,793.7 1,872.4 1,901.6 3,755.7 3,695.4 344.3 286.8 94.6% 93.8% Czech Rep. 982.8 838.1 437.0 292.3 1,419.7 1
Slide 42: Change in Group Shareholders' Equity
Change in Group Shareholders‘ Equity IFRS F 42 1.1. - 31.12.2008 1.1. - 31.12.2007 Equity as of 1 January 2,615,563 2,283,208 Currency changes -40,833 8,726 Changes to consolidation 31,628 259,295 Capital Increase 1,343,454 - Unrealised gains and losses on financial -134,328 -182,682 instruments ava
Slide 43: Life Insurance Premium Split
Life Insurance Premium Split IFRS (€mn) F 43 Premiums written - direct business YE 2008 YE 2007 +/- % Regular premiums 1,931.6 1,795.9 7.6% Single premiums 1,363.1 1,135.1 20.1% Total premiums written - direct business 3,294.7 2,931.0 12.4% thereof: Policies with profit participation 1,851.7 1,724.7
Slide 44: Q4 2008 Income Statement
Q4 2008 Income Statement IFRS (€mn) F 44 Q4 2008 Q4 2007 +/-% 1. Gross written premiums 1,881.1 1,880.1 0.1 2. Net earned premiums 1,792.5 1,721.4 4.1 3. Net investment income 111.9 259.6 -56.9 4. Other income 84.8 20.2 >100 Total income 1,989.2 2,001.1 -0.6 6. Expenses for claims incurred -1,356.0
Slide 45: YE 2008 Exchange Rates
YE 2008 Exchange Rates National currency unit per EUR F 45 YE 2008 YE 2007 Balance Sheet Balance Sheet Country Curr. P & L EUR P & L EUR EUR EUR Bulgaria EUR/BGN 1.9558 1.9558 1.9558 1.9558 Croatia EUR/HRK 7.3555 7.2239 7.3308 7.3376 Liechtenstein EUR/CHF 1.4850 1.5874 1.6547 1.6427 Poland EUR/PLN 4
Slide 46: Group Embedded Value 2008
Group Embedded Value 2008 Results (€mn) F 46 L&H P&C Total Austria/Germany 2008 2007 2008 2007 2008 2007 Comments Free Surplus 403.6 525.3 Required Capital 320.5 325.9 § Group Embedded Value (GEV) ANAV 724.1 851.2 151.4 426.6 875.5 1,277.8 calculated as Value of In-Force Business PVFP 1,233.9 1,568.
Slide 47: Group Embedded Value 2008 – Return on Adjusted Embedded Value
Group Embedded Value 2008 Return on Adjusted Embedded Value (€mn) F 47 L&H P&C Total Change in Methodology Austria / Germany and Assumptions EV Dec 31, 2008 1,670.3 151.4 1,821.7 EV Dec 31, 2007 Reported 2,012.7 617.5 2,630.2 § Allowance for Cost for Residual EV Dec 31, 2007 Restated 2,037.4 570.7 2
Slide 48: Group Embedded Value 2008 – New Business Values
Group Embedded Value 2008 New Business Values (€mn) F 48 L&H 2008 2007 +/-% Comments Austria / Germany NBV 61.6 76.2 - 19.2% APE 259.1 262.2 § The NBV represents the value generated APE-Ratio 23.8% 29.1% by new business sold during the PVNBP 2,479.2 2,398.6 reporting period. PVNBP-Ratio 2.5% 3.2% §
Slide 49: V.I.G. Has Excellent CEE Market Position
V.I.G. Has Excellent CEE Market Position V.I.G. an early mover in CEE F 49 Overview of Core Markets Details Czech Rep. Slovakia Romania Bulgaria § leading market position in nearly all core markets Pop.: 10.2 mn Pop.: 5.4 mn Pop.: 21.4 mn Pop.: 7.6 mn § strong market positions GDP/Cap.: $ 17 k GDP/C
Slide 50: Shareholder Structure (I)
Shareholder Structure (I) Total number of shares 128,000,000 F 50 Shareholder Structure ~70 % Wiener Städtische Wechselseitige Versicherungsanstalt- Vermögensverwaltung ~ 30 % Free Float
Slide 51: Shareholder Structure (II)
Shareholder Structure (II) Total number of shares 128,000,000 F 51 Free Float Geographical Split ~21 % Austria ~20% ~14% North America Others ~32% ~13% Continental Europe UK & Ireland
Slide 52: Contact Details
Contact Details Investor Relations F 52 Vienna Insurance Group Schottenring 30, 1010 Vienna, Austria www.viennainsurancegroup.com Stock exchange listing: VIENNA / PRAGUE Ticker symbol: VIG / VIG Reuters: VIGR.VI / VIGR.PR Bloomberg: VIG AV / VIG CP § Thomas Schmee Tel. +43 (0)50 350 – 21900 thomas.s
Slide 53: Disclaimer
Disclaimer F 53 IMPORTANT NOTICE These materials do not constitute or form part, or all, of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities in any jurisdiction in which such solicitation, offer or sale would be unlawful, nor sha
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