Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — German Corporate Conference, Frankfurt 2016
53 slides from Vienna Insurance's conference presentation, Jan 20, 2016
Slide 1: Vienna Insurance Group Investor Presentation
Vienna Insurance Group Investor Presentation German Corporate Conference Frankfurt, 20 January 2016 9M 2015 Strategy Potential Main regions Appendix
Slide 2: Development 9M 2015, Successful strategy, Long-term potential
Development 9M 2015 Successful strategy Long-term potential Main regions Appendix 9M 2015 Strategy Potential Main regions Appendix
Slide 3: 9M 2015 operating developments in line with trends
9M 2015 operating developments in line with trends observed in previous quarters IT impairment in the size of €195mn €6.9bn Premium business decrease of 1.8% caused by reduced life single premium GWP Current life premiums up 5.8% but could not compensate for single premium business decline of 18.4%
Slide 4: Premiums overall slightly down 1.8% driven by single premium life decrease
Premiums overall slightly down 1.8% driven by single premium life business decrease Top-line growth of 2.5% adjusted for single premium life business Gross written premiums (€mn; y-o-y chg.) GWP regional split y-o-y chg. -2% Austria 3,154 -2% 7,039 31 8 6,912 Czech Republic 1,193 -7% Health 291 299
Slide 5: Operating result at €370.3mn; IT impairment of €195mn
Operating result at €370.3mn; review of IT systems’ landscape led to impairment of €195mn PBT after impairment of €175.3mn down by 60.2% Profit before taxes (€mn; y-o-y change) PBT regional split y-o-y chg. -60% Austria 117 -30% 441 Health 47 Czech Republic 126 -1% Slovakia 40 -6% Life 158 -241 Pola
Slide 6: Group combined ratio at 96.9%
Group combined ratio at 96.9% Improvement of 0.2%p compared y-o-y P&C Combined ratio development P&C CoR 9M y-o-y regional development (net, %) -0.2%p AT 100.8 -2.2%p 97.2 96.9 98.6 CZ 88.8 +0.6%p 89.4 SK 93.1 +3.6%p 9M14 Claims ratio 67.1 66.4 96.6 94.6 9M15 PL +2.6%p 97.2 RO 109.3 -7.1%p Cost rati
Slide 7: Development 9M 2015, Successful strategy, Long-term potential
Development 9M 2015 Successful strategy Long-term potential Main regions Appendix 9M 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 period VIG Strategy Growth period Elevate potential in changing market phases through adaptive growth policy Time Accelerated Differentiated growth growth - Accelerate growth in all - Consolidation of
Slide 9: Adaptive growth policy (II)
Adaptive growth policy (II) Elevate growth potentials correspondingly VIG Strategy Elevate potential also during Market growth Recovery period recovery period through differentiated growth policies Consolidation of high margin business Growth period Push non-motor business SME Unit-linked life and t
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 9M 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 23.9% Czech Republic 1 2 1 33.1% Slovakia 1 2 1 33.7% Poland 4 4 6 6.5% Romania 1 1 2 20.1% Bulgaria 2 2 2 14.2% Croatia 4 6 3 8.1% Serbia 4 5 2 9.3
Slide 17: Development 9M 2015, Successful strategy, Long-term potential
Development 9M 2015 Successful strategy Long-term potential Main regions Appendix 9M 2015 Strategy Potential Main regions Appendix
Slide 18: 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 AT insurance drivers 1 500 AT 1 000 500 CZ PL SK CZ HU PL HU SK 2000 2014 RO 0 RO 1 000,0 6 000,0 36 000,0 GDP per capita in EUR Sourc
Slide 19: Striking under-penetration shows potential
Striking under-penetration shows potential Annual premiums per capita (insurance density), in EUR 2,845 10x Long-term growth potential 2,007 in CEE still lies ahead Life 527 Non-life 403 341 277 262 201 126 91 82 38 Ø EU-15 AT Ø CEE CZ SK PL HU HR BG RO SR UA Source: Local insurance authorities; IMF
Slide 20: 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 ~ 121 mn Ø-premium per capita 803 EUR Premium per cap. 157 EUR Ø-p
Slide 21: The Baltics: Growing region with ~6.3mn inhabitants
The Baltics: Growing region with a common population of ~6.3mn inhabitants Three countries with favourable macroeconomic data GDP per capita (PPP, in USD) Premium per capita 2014 (in €) 40 000 Estonia 335 35 000 Lithuania 203 30 000 Latvia 172 25 000 Austria 2,007 20 000 Ø EU-15 2,845 15 000 Estonia
Slide 22: The Baltics: VIG further increasing business activities
The Baltics: VIG further increasing business activities in order to benefit from promising development Acquisitions and formation of a new insurance company Acquisition of Finsaltas Compensa Life Estonia Life Insurance sales company Life insurer active in all Baltic ~300 insurance brokers states Bro
Slide 23: Development 9M 2015, Successful strategy, Long-term potential
Development 9M 2015 Successful strategy Long-term potential Main regions Appendix 9M 2015 Strategy Potential Main regions Appendix
Slide 24: Austria: negative impacts from low interest rate environment
Austria: negative impacts from low interest rate environment CoR down to 98.6% from 100.8% in 9M 2014 GWP development (€mn) P&C GWP direct business split1 -2.1% MTPL 3,222 3,154 17% (19%) P&C 1,490 1,493 14% Casco Health 275 284 (14%) 69% Life 1,457 1,377 (67%) Non-motor 9M14 9M15 P&L: P&C business
Slide 25: Czech Republic: contributing most to Group profits
Czech Republic: contributing most to Group profits CoR at excellent level of 89.4% GWP development (€mn) P&C GWP direct business split1 -6.8% 1,281 1,193 MTPL 31% P&C 635 (31%) 638 Non-motor 46% (48%) Life 645 556 23% (21%) 9M14 9M15 Casco P&L: P&C business (€mn) P&L: Life business (€mn) 9M15 Y-o-Y
Slide 26: Slovakia: stable top-line, profit before taxes down
Slovakia: stable top-line development but profit before taxes down to €40.4mn from €43.1mn in 9M 2014 P&C profitability impacted by increased weather related claims GWP development (€mn) P&C GWP direct business split1 +0.5% 549 552 Non-motor 33% P&C 252 254 (34%) 39% MTPL (40%) Life 297 298 27% (27%
Slide 27: Poland: ongoing pricing pressure
Poland: ongoing pricing pressure CoR increased to 97.2%; still solid given current market environment in PL GWP development (€mn) P&C GWP direct business split1 -21.5% 809 MTPL 635 32% P&C 427 Non-motor 43% (32%) 358 (43%) Life 383 277 26% (25%) 9M14 9M15 Casco P&L: P&C business (€mn) P&L: Life busi
Slide 28: Romania: profit before taxes doubled to €5.5mn
Romania: profit before taxes doubled to €5.5mn Positive CoR development on both, claims and cost ratio GWP development (€mn) P&C GWP direct business split1 +23.3% 301 Non-motor 244 29% (32%) 42% MTPL 242 (38%) P&C 209 Life 59 28% 35 (29%) 9M14 9M15 Casco P&L: P&C business (€mn) P&L: Life business (€
Slide 29: Remaining markets: record result
Remaining markets: record result with double-digit growth of premiums and profits Profits in CEE Remaining markets up by 15.4% GWP development (€mn) P&C GWP direct business split1 +14.6% MTPL 955 834 23% (23%) 495 P&C 459 16 58% Health 16 Non-motor (58%) 19% 359 445 (19%) Life Casco 9M14 9M15 P&L: P
Slide 30: Appendix
Development 9M 2015 Successful strategy Long-term potential Main regions Appendix Please note: The figures for 2014 have been restated due to changes in the scope of consolidation. 9M 2015 Strategy Potential Main regions Appendix
Slide 31: 9M 2015 Key financials
9M 2015 Key financials Overview of KPIs Net Profit after tax and minorities (€mn) Combined Ratio (net, %) 367 100.6 337 96.7 97.2 96.9 234 143 2013 2014 9M14 9M15 2013 2014 9M14 9M15 EPS1 (€) ROE before Taxes² (%) 3.35 12.5 11.0 2.75 7.1 1.57 1.36 5.0 2013 2014 9M14 9M15 2013 2014 9M14 9M15 1: EPS n
Slide 32: 9M 2015 Income statement
9M 2015 Income statement IFRS (€mn) €mn 9M 2015 9M 2014 +/-% Gross premiums written 6,912.4 7,038.6 -1.8 Net earned premiums 6,147.3 6,326.7 -2.8 Financial result1 797.3 858.6 -7.1 Other income 78.3 81.8 -4.3 Total income 7,022.8 7,267.1 -3.4 Expenses for claims and insurance benefits -5,021.2 -5,29
Slide 33: 9M 2015 Balance sheet
9M 2015 Balance sheet IFRS (€mn) €mn 30.09.2015 31.12.2014 +/-% Intangible assets 2,169 2,370 -8.5 Investments 30,347 30,360 0.0 Unit- and index-linked investments 7,888 7,742 1.9 Reinsurers’ share in underwriting provisions 1,161 1,106 5.0 Receivables 1,439 1,502 -4.2 Tax receivables and advance pa
Slide 34: VIG strongly capitalised also under Solvency 2
VIG strongly capitalised also under Solvency 2: S2 ratio of ~170% at year-end 2014 VIG working on partial internal model for non-life and real estate VIG is well prepared for Solvency 2 Process steered out of Austria Common guidelines, calculation and reporting implemented Work on a partial internal
Slide 35: S&P rating confirmed in July 2015: A+/stable
S&P rating confirmed in July 2015: A+/stable/-- VIG remains the best rated company in the ATX Anchor: Business Risk Profile: Very Strong aa- „Very strong competitive position, based on leading market positions in Austria and CEE“ „Sound diversification by business line and a well-established multich
Slide 36: Conservative investment strategy to be maintained
Conservative investment strategy to be maintained Bond rating split impacted by rating downgrades of Austrian banks 9M 2015: Total €31.6bn Bond portfolio by rating1 Other 6% 6% 6.8% 12% 16% BBB 3.4% 0.0% A 38% 32% 9.1% AA 29% 35% 6.4% AAA 15% 11% 4.0% 12M14 9M15 Bond portfolio by issuer 70.5% Corpor
Slide 37: 9M 2015 Financial result
9M 2015 Financial result Current income decreased by more than €40mn Income P&C Life Health Total in € '000 9M 2015 9M 2014 9M 2015 9M 2014 9M 2015 9M 2014 9M 2015 9M 2014 Current income 207,226 213,917 619,908 651,422 30,642 32,905 857,776 898,244 Income from appreciations 7,365 20,554 5,657 12,639
Slide 38: 9M 2015 P&L Property & Casualty
9M 2015 P&L Property & Casualty IFRS (€mn) €mn 9M 2015 9M 2014 +/-% Gross premiums written 3,594.5 3,563.5 0.9 Net earned premiums 2,860.0 2,864.1 -0.1 Financial result 125.8 157.6 -20.2 Other income 43.6 52.3 -16.7 Total income 3,029.5 3,074.1 -1.5 Expenses for claims and insurance benefits -1,898.
Slide 39: 9M 2015 P&L Life
9M 2015 P&L Life IFRS (€mn) €mn 9M 2015 9M 2014 +/-% Gross premiums written 3,018.5 3,184.0 -5.2 Net earned premiums 2,994.1 3,165.6 -5.4 Financial result 643.3 673.2 -4.4 Other income 34.4 29.2 17.8 Total income 3,671.9 3,868.0 -5.1 Expenses for claims and insurance benefits -2,881.6 -3,134.7 -8.1
Slide 40: 9M 2015 P&L Health
9M 2015 P&L Health IFRS (€mn) €mn 9M 2015 9M 2014 +/-% Gross premiums written 299.4 291.1 2.9 Net earned premiums 293.1 297.1 -1.3 Financial result 28.1 27.7 1.6 Other income 0.3 0.3 3.0 Total income 321.5 325.0 -1.1 Expenses for claims and insurance benefits -240.7 -241.1 -0.2 Acquisition and admin
Slide 41: 9M 2015 P&L regions (I)
9M 2015 P&L regions (I) IFRS (€mn) Austria Czech Republic Slovakia €mn 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% Gross premiums written 3,154.2 3,222.3 -2.1 1,193.2 1,280.6 -6.8 551.8 549.0 0.5 Net earned premiums 2,520.0 2,595.0 -2.9 927.1 1,031.1 -10.1 449.9 448.7 0.3 Financia
Slide 42: 9M 2015 P&L regions (II)
9M 2015 P&L regions (II) IFRS (€mn) Poland Romania Remaining €mn 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% Gross premiums written 635.3 809.2 -21.5 300.6 243.8 23.3 955.2 833.7 14.6 Net earned premiums 545.4 663.7 -17.8 192.3 132.6 45.0 707.2 626.4 12.9 Financial result 35.6 39.
Slide 43: 9M 2015 P&L regions (III)
9M 2015 P&L regions (III) IFRS (€mn) Central Functions Consolidation TOTAL €mn 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-% Gross premiums written 968.6 989.6 -2.1 -846.4 -889.8 n.a. 6,912.4 7,038.6 -1.8 Net earned premiums 805.8 831.1 -3.1 -0.3 -2.0 n.a. 6,147.3 6,326.7 -2.8 Finan
Slide 44: 9M 2015 Results by country (I)
9M 2015 Results by country (I) IFRS (€mn) GWP P&C GWP Life GWP Health GWP Total 9M 9M 9M 9M 9M 9M 9M 9M +/-% +/-% +/-% +/-% 2015 2014 2015 2014 2015 2014 2015 2014 Austria 1,493.5 1,490.0 0.2% 1,376.9 1,457.4 -5.5% 283.8 274.8 3.3% 3,154.2 3,222.3 -2.1% Czech Rep. 637.7 635.2 0.4% 555.5 645.4 -13.9%
Slide 45: 9M 2015 Results by country (II)
9M 2015 Results by country (II) IFRS (€mn) Profit before Taxes Net Combined Ratio 9M 2015 9M 2014 +/-% 9M 2015 9M 2014 +/-%p Austria 116.9 166.3 -29.7% 98.6% 100.8% -2.2 Czech Rep. 125.9 127.6 -1.3% 89.4% 88.8% 0.6 Slovakia 40.4 43.1 -6.1% 96.6% 93.1% 3.6 Poland 38.1 48.7 -21.8% 97.2% 94.6% 2.6 Roma
Slide 46: 9M 2015 P&C claims and cost ratio details
9M 2015 P&C claims and cost ratio details Claims ratio 9M y-o-y regional development (net, %) Remarks for claims incurred 9M14 9M15 Austria: claims ratio down 2.7%p driven by reduced Italian business of Donau Versicherung -2.7 +0.2 +6.4 -1.2 +2.5 Stable claims ratios in the Czech Republic +4.3 Incre
Slide 47: 3Q 2015 Income statement
3Q 2015 Income statement IFRS (€mn) €mn 3Q 2015 3Q 2014 +/-% Gross premiums written 2,004.4 2,054.8 -2.5 Net earned premiums 1,938.4 2,005.2 -3.3 Financial result1 272.8 293.5 -7.1 Other income 28.1 23.7 18.4 Total income 2,239.3 2,322.5 -3.6 Expenses for claims and insurance benefits -1,668.6 -1,69
Slide 48: 9M 2015 Exchange rates
9M 2015 Exchange rates 9M 2015 9M 2014 Balance Sheet Balance Sheet Country Currency P&L EUR P&L EUR EUR EUR Albania EUR/ALL 139.3900 140.2398 139.8900 140.0483 Belarus EUR/BYR 19,908.0000 17,027.4249 13,420.0000 13,610.4029 Bosnia EUR/BAM 1.9558 1.9558 1.9558 1.9558 Bulgaria EUR/BGN 1.9558 1.9558 1.
Slide 49: VIG share (I)
VIG share (I) Current analyst recommendation split Share price development 12M 2015 Sell High EUR 42.620 Low EUR 24.910 Buy Price as of 30 Dec. EUR 25.290 Average daily volume EUR 7.0 mn Market cap. EUR 3.2 bn Development YTD % -31.8 Hold VIG compared to ATX and Stoxx Europe 600 Ins. 135 125 115 105
Slide 50: 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 51: Contact details
Contact details Investor Relations Financial calendar 2016 Investor Relations Team Date Event Vienna Insurance Group Publication: Preliminary Schottenring 30, 1010 Vienna 26 Jan. 2016 unconsolidated premiums 2015 E-Mail: [email protected] www.vig.com/ir 07 Apr. 2016 Results and Embedded Val
Slide 52: 9M 2015 Strategy Potential
9M 2015 Strategy Potential Main regions Appendix
Slide 53: 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
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