Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — Bank conference, Rome (June 2015)
54 slides from Vienna Insurance's conference presentation, Jun 15, 2015
Slide 1: Vienna Insurance Group Investor Presentation
Vienna Insurance Group Investor Presentation Rome, 15 June 2015 3M 2015 Strategy Potential Main regions Appendix
Slide 2: Development 3M 2015
Development 3M 2015 Successful strategy Long-term potential Main regions Appendix 3M 2015 Strategy Potential Main regions Appendix
Slide 3: A solid first quarter
A solid first quarter All business segments and countries with positive profit contribution €2.8bn Premiums up 0.9% Sound development despite substantial decreases in life single premium business Remaining markets continued to grow strongly by 15.9% Profit before taxes of €131mn down 15.2% €131mn Ne
Slide 4: Sound premium development
Sound premium development Remaining markets premiums up by 15.9% Gross written premiums (€mn; y-o-y chg.) GWP regional split y-o-y chg. +1% Austria 1,341 -3% 2,731 21 4 2,756 Czech Republic 458 -2% Health 103 102 -1 Slovakia 215 1% Life 1,154 1,159 Poland 238 -8% Romania 100 22% Remaining markets 35
Slide 5: Profit before taxes of €130.9mn down 15.2%
Profit before taxes of €130.9mn down 15.2% All business segments and countries with positive profit contribution Profit before taxes (€mn; y-o-y change) PBT regional split y-o-y chg. -15% Austria 40 -31% 154 Health 12 Czech Republic 46 -10% 0 131 -15 12 Slovakia 10 3% Life 48 -9 Poland 17 4% 40 Roma
Slide 6: Group combined ratio further decreased to 96.3%
Group combined ratio further decreased to 96.3% P&C Combined ratio development P&C CoR 3M y-o-y regional development (net, %) -0.1%p AT 99.8 -1.8%p 96.4 96.3 98.1 CZ 85.4 +4.3%p 89.7 63.5 SK 95.1 -0.6%p 3M14 Claims ratio 65.3 94.5 97.8 3M15 PL +0.4%p 98.1 RO 105.8 -1.0%p Cost ratio 31.1 32.8 104.8 R
Slide 7: Successful strategy
Development 3M 2015 Successful strategy Long-term potential Main regions Appendix 3M 2015 Strategy Potential Main regions Appendix
Slide 8: Adaptive growth policy (I)
Adaptive growth policy (I) CEE growth potentials develop in a step function Market growth Recovery stage VIG Strategy Growth stage Elevate potential in changing market phases through adaptive growth policy Time Accelerated Differentiated growth growth - Accelerate growth in all - Consolidation of hi
Slide 9: Adaptive growth policy (II)
Adaptive growth policy (II) Elevate growth potentials correspondingly VIG Strategy Market growth Recovery stage Elevate potential also during recovery phases through differentiated growth policies Consolidation of high margin Growth stage business SME Push non-motor business Unit-linked life insuran
Slide 10: Clear strategy focusing on Austria and the CEE region
Clear strategy focusing on Austria and the CEE region Strategic cornerstones of VIG Local entrepreneurship Multi-brand strategy Multi-channel distribution Conservative investments 3M 2015 Strategy Potential Main regions Appendix 10
Slide 11: Dynamic expansion into CEE out of Austria
Dynamic expansion into CEE out of Austria VIG with the most diversified network throughout the region 1990: 3 Markets Today: 25 Markets Client/talent base: 24mn people Client/talent base: 180mn people VIG Core markets 1990 1996 1999 2001/2002 2004 2006 2007 2008 2010 2011 2014 CZ, SK HU, PL, IT, LI,
Slide 12: 25 years in Central and Eastern Europe (CEE)
25 years in Central and Eastern Europe (CEE) VIG - Value Inspired Growth Geographical distribution VIG – established confidence for the future GWP CEE First-mover advantage in the region with GWP 51% subsequent outperformance of the market 51% CEE From <5 to ~50 insurance companies 100% Footprint co
Slide 13: Focus on insurance business
Focus on insurance business Successful banc-assurance in Austria and CEE Insurance business is core business of VIG Business mix 2014 Today around 50 insurance companies are Health part of VIG 4% Nearly all lines of retail and commercial business covered – pension fund business 46% Life being not co
Slide 14: Local entrepreneurship as basis for success
Local entrepreneurship as basis for success Clear commitment to local management Insurance business is local business Local management with best understanding of their markets and customer needs Members of the management board of VIG all have different country responsibilities and are members in the
Slide 15: Unique market approach with long-term focus
Unique market approach with long-term focus Multi-brand and multi-channel provide best access to customers Multi-brand Multi-channel Local brands with good customer recognition Austria are retained Different brands target different client groups Czech Rep. Multi-brand allows for internal benchmarkin
Slide 16: Excellent market positions of VIG
Excellent market positions of VIG VIG is the clear No 1 in its core markets Market positions Country Total market share Total N-life Life Austria 1 1 1 23.8% Czech Republic 1 2 1 33.7% Slovakia 1 2 1 33.6% Poland 4 4 4 8.3% Romania 1 1 2 19.5% Bulgaria 2 3 2 12.7% Croatia 4 5 2 8.4% Serbia 4 5 2 10.
Slide 17: VIG strengthens its market position
VIG strengthens its market position Very strong market share of 19% in its core markets 20% VIG Nr.1 18% 16% 14% 12% Italian competitor Austrian competitor 10% German competitor 8% 6% 2009 2010 2011 2012 2013 Q3 2014 VIG almost twice as big as peers in its core markets Source: local market reports;
Slide 18: Long-term potential
Development 3M 2015 Successful strategy Long-term potential Main regions Appendix 3M 2015 Strategy Potential Main regions Appendix
Slide 19: Insurance growth is a catching-up process
Insurance growth is a catching-up process Model of insurance demand development still valid 2 500 Insurance density in EUR GDP growth and catch- up process are 2 000 insurance drivers AT 1 500 AT 1 000 500 CZ PL SK HU CZ 2000 2013 PLHU SK RO 0 RO 1 000,0 6 000,0 36 000,0 GDP per capita in EUR Source
Slide 20: Striking under-penetration shows potential
Striking under-penetration shows potential Annual premiums per capita (insurance density), in EUR 2,713 9x Long-term growth potential 1,954 Life in CEE still lies ahead 548 Non-life 399 351 272 275 212 123 88 75 59 Ø EU-15 AT Ø CEE CZ SK PL HR HU BG RO SR UA Source: Local insurance authorities; IMF;
Slide 21: CEE offers access to long-term growth potential
CEE offers access to long-term growth potential Presence in more mature markets as well as in high growth countries Growth region Core region Countries EE, LV, LT, PL, Population ~ 34 mn UA, RO, BG Countries AT, CZ, SK, HU Population ~ 119 mn Ø-premium per capita 794 EUR Premium per cap. 171 EUR Ø-p
Slide 22: Fundamental indicators for motor business in CEE
Fundamental indicators for motor business in CEE Number of registered cars in CEE shows motor under-penetration Age of registered cars in VIG countries1 Number of registered cars per 1000 inhabitants2 2% 4% 4% 7% 8% 4% 7% 7% 14% 6% 7% 9% 11% 13% 18% 17% 18% 17% 19% 23% 19% 22% 20% 28% 26% 32% 31% 73
Slide 23: Macroeconomic upswing in VIG markets
Macroeconomic upswing in VIG markets Promising macro data for the years to come Improving macro data of regions where VIG operates in Change to previous year: Positive AT CZ SK PL RO Remains constant Negative 2015 2016 2017 2015 2016 2017 2015 2016 2017 2015 2016 2017 2015 2016 2017 GDP Inflation Un
Slide 24: Main regions
Development 3M 2015 Successful strategy Long-term potential Main regions Appendix 3M 2015 Strategy Potential Main regions Appendix
Slide 25: Austria – effects out of low interest rate environment
Austria – effects out of low interest rate environment and increased weather related claims CoR improved but still burdened by Italian business of Donau GWP development (€mn) P&C GWP direct business split1 -2.5% MTPL 1,375 1,341 15% (17%) P&C 722 723 12% Casco (12%) Health 94 97 73% Life 559 521 (70
Slide 26: Czech Republic – contributing most to Group profits
Czech Republic – contributing most to Group profits Higher weather related claims; CoR maintained at excellent 89.7% GWP development (€mn) P&C GWP direct business split1 -1.8% 466 458 MTPL 29% 236 (28%) P&C 235 51% Non-motor (54%) Life 231 223 20% (18%) Casco 3M 14 3M 15 P&L: P&C business (€mn) P&L:
Slide 27: Slovakia – solid performance in the first quarter
Slovakia – solid performance in the first quarter CoR further improved y-o-y GWP development (€mn) P&C GWP direct business split1 +0.7% 213 215 Non-motor 37% P&C 107 104 41% MTPL (36%) (42%) Life 106 111 23% (22%) 3M 14 3M 15 Casco P&L: P&C business (€mn) P&L: Life business (€mn) 3M15 Y-o-Y 3M15 Y-o
Slide 28: Poland – challenging market environment
Poland – challenging market environment Increased price competition in P&C reflected in decreased premium volume GWP development (€mn) P&C GWP direct business split1 -7.6% 258 MTPL 238 28% (29%) P&C 148 123 Non-motor 48% (47%) Life 109 115 25% (23%) Casco 3M 14 3M 15 P&L: P&C business (€mn) P&L: Lif
Slide 29: Romania – substantial premium increase
Romania – substantial premium increase Positive profit contribution from P&C and life GWP development (€mn) P&C GWP direct business split1 +21.7% 100 Non-motor 82 29% (33%) 46% MTPL 84 (40%) P&C 69 24% Life 14 17 (27%) 3M 14 3M 15 Casco P&L: P&C business (€mn) P&L: Life business (€mn) 3M15 Y-o-Y 3M1
Slide 30: Remaining markets – ongoing top and bottom line growth
Remaining markets – ongoing top and bottom line growth Remaining CEE markets increased overall PBT by 1.5% GWP development (€mn) P&C GWP direct business split1 +15.9% MTPL 357 20% 308 (19%) 183 P&C 169 4 16% Health 8 63% (17%) Casco 170 (65%) Life 131 Non-motor 3M 14 3M 15 P&L: P&C business (€mn) P&
Slide 31: Appendix
Development 3M 2015 Successful strategy Long-term potential Main regions Appendix Please note: The figures for 2013 have been restated due to changes in the scope of consolidation. 3M 2015 Strategy Potential Main regions Appendix
Slide 32: 3M 2015 – Key financials
3M 2015 – Key financials Overview of KPIs Net Profit after tax and minorities (€mn) Combined Ratio (net, %) 367 100.6 96.7 96.4 96.3 234 121 99 2013 2014 3M14 3M15 2013 2014 3M14 3M15 EPS1 (€) ROE before Taxes (%) 3.62 12.2 2.94 10.1 9.7 2.75 6.7 1.57 2013 2014 3M14 3M15 2013 2014 3M14 3M15 1: EPS n
Slide 33: 3M 2015 – Income statement
3M 2015 – Income statement IFRS (€mn) €mn 3M 2015 3M 2014 +/-% Gross premiums written 2,755.9 2,731.1 0.9 Net earned premiums 2,210.6 2,212.6 -0.1 Financial result1 273.4 275.8 -0.9 Other income 28.3 27.6 2.6 Total income 2,512.3 2,515.9 -0.1 Expenses for claims and insurance benefits -1,729.8 -1,83
Slide 34: 3M 2015 – Balance sheet
3M 2015 – Balance sheet IFRS (€mn) €mn 31.03.2015 31.12.2014 +/-% Intangible assets 2,364 2,370 -0.3 Investments 31,413 30,360 3.5 Unit- and index-linked investments 8,337 7,742 7.7 Reinsurers’ share in underwriting provisions 1,237 1,106 11.9 Receivables 1,694 1,502 12.8 Tax receivables and advance
Slide 35: 3M 2015 – Strong equity and solvency position
3M 2015 – Strong equity and solvency position Shareholders’ equity increased Change in Group Shareholders’ Equity (€mn) +4% 132 -3 5,480 -52 -7 26 100 5,283 Equity restated Profit for Currency AFS unrealised Dividend Repurchase Other Equity as as of 12M14 the period changes gains and losses payment
Slide 36: 3M 2015 – Financial result development
3M 2015 – Financial result development Slight decrease y-o-y Financial result y-o-y changes (€mn) -1% 275.8 2.2 273.4 3.9 -8.5 Financial result 3M14 Chg. P&C Chg. Life Chg. Health Financial result 3M15 Remarks Financial result of € 273.4mn includes P&L neutral positive FX effects from currency hedgi
Slide 37: 3M 2015 – Financial result
3M 2015 – Financial result Net realised gains at level of last year Income P&C Life Health Total in € '000 3M 2015 3M 2014 3M 2015 3M 2014 3M 2015 3M 2014 3M 2015 3M 2014 Current income 66,410 70,784 194,076 202,822 11,169 10,423 271,655 284,029 Income from appreciations 3,755 17,891 4,641 4,771 95
Slide 38: Conservative investments with a well diversified bond portfolio
3M 2015 – Conservative investments with a well diversified bond portfolio Biggest part invested in fixed income assets 3M 2015: Total €32.4bn Bond portfolio by rating1 Other 6% 5% 6.2% 12% 13% BBB 3.1% 0.0% 36% A 38% 9.4% AA 29% 34% 6.1% AAA 15% 11% 4.2% 12M 2014 3M 2015 Bond portfolio by issuer 71.
Slide 39: 3M 2015 – P&L Property & Casualty
3M 2015 – P&L Property & Casualty IFRS (€mn) €mn 3M 2015 3M 2014 +/-% Gross premiums written 1,495.7 1,474.4 1.4 Net earned premiums 977.6 979.1 -0.2 Financial result 55.1 63.6 -13.4 Other income 14.9 17.1 -12.6 Total income 1,047.6 1,059.8 -1.2 Expenses for claims and insurance benefits -621.0 -639
Slide 40: 3M 2015 – P&L Life
3M 2015 – P&L Life IFRS (€mn) €mn 3M 2015 3M 2014 +/-% Gross premiums written 1,158.5 1,154.1 0.4 Net earned premiums 1,135.4 1,132.4 0.3 Financial result 208.9 205.0 1.9 Other income 13.0 10.5 24.2 Total income 1,357.3 1,347.9 0.7 Expenses for claims and insurance benefits -1,026.9 -1,111.3 -7.6 Ac
Slide 41: 3M 2015 – P&L Health
3M 2015 – P&L Health IFRS (€mn) €mn 3M 2015 3M 2014 +/-% Gross premiums written 101.7 102.6 -0.8 Net earned premiums 97.6 101.0 -3.3 Financial result 9.3 7.1 30.9 Other income 0.3 0.0 >100 Total income 107.3 108.1 -0.7 Expenses for claims and insurance benefits -81.9 -83.1 -1.5 Acquisition and admin
Slide 42: 3M 2015 – P&L regions (I)
3M 2015 – P&L regions (I) IFRS (€mn) Austria Czech Republic Slovakia €mn 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% Gross premiums written 1,341.0 1,375.4 -2.5 457.8 466.4 -1.8 214.7 213.2 0.7 Net earned premiums 902.1 938.1 -3.8 349.8 361.7 -3.3 166.6 162.7 2.4 Financial result
Slide 43: 3M 2015 – P&L regions (II)
3M 2015 – P&L regions (II) IFRS (€mn) Poland Romania Remaining €mn 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% Gross premiums written 238.1 257.7 -7.6 100.3 82.4 21.7 357.2 308.2 15.9 Net earned premiums 205.6 203.7 0.9 61.7 46.4 32.8 254.7 219.4 16.1 Financial result 14.6 13.3 9.
Slide 44: 3M 2015 – P&L regions (III)
3M 2015 – P&L regions (III) IFRS (€mn) Central Functions Consolidation TOTAL €mn 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-% Gross premiums written 371.0 359.2 3.3 -324.3 -331.4 n.a. 2,755.9 2,731.1 0.9 Net earned premiums 269.6 282.2 -4.5 0.5 -1.7 n.a. 2,210.6 2,212.6 -0.1 Financ
Slide 45: 3M 2015 – Results by country (I)
3M 2015 – Results by country (I) IFRS (€mn) GWP P&C GWP Life GWP Health GWP Total 3M 3M 3M 3M 3M 3M 3M 3M +/-% +/-% +/-% +/-% 2015 2014 2015 2014 2015 2014 2015 2014 Austria 722.9 721.6 0.2% 520.7 559.4 -6.9% 97.4 94.3 3.2% 1,341.0 1,375.4 -2.5% Czech Rep. 234.5 235.8 -0.5% 223.2 230.6 -3.2% - - - 4
Slide 46: 3M 2015 – Results by country (II)
3M 2015 – Results by country (II) IFRS (€mn) Profit before Taxes Net Combined Ratio 3M 2015 3M 2014 +/-% 3M 2015 3M 2014 +/-%p Austria 39.6 57.7 -31.4% 98.1% 99.8% -1.8 Czech Rep. 45.8 51.0 -10.2% 89.7% 85.4% 4.3 Slovakia 9.7 9.4 2.6% 94.5% 95.1% -0.6 Poland 16.6 15.9 4.3% 98.1% 97.8% 0.4 Romania 1.
Slide 47: 3M 2015 – P&C Claims and cost ratio details
3M 2015 – P&C Claims and cost ratio details Claims ratio 3M y-o-y regional development (net, %) Remarks for claims incurred Austria: claims ratio down 3.6%p driven by development of Donau 3M14 3M15 Versicherung (less business volume in Italy) -3.6 +5.5 +6.0 +6.5 Czech Republic: slight increase due t
Slide 48: 3M 2015 – Exchange rates
3M 2015 – Exchange rates 3M 2015 3M 2014 Balance Sheet Balance Sheet Country Currency P & L EUR P & L EUR EUR EUR Albania EUR/ALL 140.3400 140.2321 140.2700 140.3884 Belarus EUR/BYR 15,970.0000 16,574.8889 13,570.0000 13,280.6667 Bosnia EUR/BAM 1.9558 1.9558 1.9558 1.9558 Bulgaria EUR/BGN 1.9558 1.9
Slide 49: Maintaining steady dividends – DPS of €1.40
Maintaining steady dividends – DPS of €1.40 Dividend yield amounting to 3.8%1 for 2014 Dividend per share (€) Dividend pay-out (€mn) 8% CAGR 9% 1.40 179.2 1.30 166.4 1.20 153.6 1.10 140.8 1.00 128.0 2010 2011 2012 2013 2014p 2010 2011 2012 2013 2014p Dividend policy Unchanged dividend policy with a
Slide 50: VIG share (I)
VIG share (I) Current analyst recommendation split Share price development 3M 2015 Sell Buy High EUR 42.550 Low EUR 35.825 Price as of 31 Mar. EUR 41.200 Average daily volume EUR 4.2 mn Market cap. EUR 5.3 bn Development YTD % 11.1 Hold VIG compared to ATX and Stoxx Europe 600 Ins. 125 120 115 110 1
Slide 51: VIG share (II)
VIG share (II) General information Shareholder structure Number of common shares: 128mn ISIN: AT0000908504 ~30% Wiener Städtische Free Float Listings: Wechselseitiger Versicherungsverein - Vienna – since 17 Oct. 1994 Vermögensverwaltung – Vienna Insurance Group ~70% Prague – since 5 Feb. 2008 Ticker
Slide 52: Contact details
Contact details Investor Relations Financial calendar 2015 Investor Relations Team Date Event Vienna Insurance Group Schottenring 30, 1010 Vienna Publication: Preliminary E-Mail: [email protected] 27 Jan. 2015 unconsolidated premiums 2014 www.vig.com/ir Nina Higatzberger (Head of IR) 14 Apr
Slide 53: 3M 2015 Strategy Potential
3M 2015 Strategy Potential Main regions Appendix
Slide 54: Disclaimer
Disclaimer 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 shall pa
Vienna Insurance Group — Bank conference, Rome (June 2015) on 6ix