Ageas Sa/nv · EURONEXT:AGS
Ageas Sa/nv — Q1 2013 Earnings Presentation
65 slides from Ageas Sa/nv's earnings presentation, May 15, 2013
Slide 1: 9M Periodical Financial Information
9M FY Periodical Periodical Financial Financial Information Information
Slide 2: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance Activities Investment portfolio General Account General Information
Slide 3: Main messages 3M 13 results
Main messages 3M 13 results Ageas announces positive start to the year Insurance net profit of EUR 157 mio Inflows at EUR 6.8 bn (+20%) Insurance results broadly in line with last year Group combined ratio at 99.5% (vs.101.9%) Life Technical Liabilities at EUR 69.5 bn* (+1%) Group net prof
Slide 4: Headlines
Headlines Ageas announces positive start to the year Insurance net result: Better Non-Life Both Insurance & General Account Net cash: Almost EUR 1.0 bn compensates lower Life result contributing to Group net result expected from RPI/Call option In EUR mio In EUR mio In EUR mio 293 155 157 3 4 (84) 1
Slide 5: Key financials 3M 13
Key financials 3M 13 Good overall performance, strongly increased inflows EUR mio 3M 12 3M 13 Gross inflows 5,650 6,753 - of which inflows from non-consolidated partnerships 2,830 4,008 Net result Insurance 155 157 By segment: - Belgium 78 80 - UK 17 23 - Continental Europe 17 17 - Asia 43 37 By typ
Slide 6: Overview impairments & net capital gains
Overview impairments & net capital gains Lower amount of impairments in y-o-y comparison Impairments & Profit Capital gains/losses Total impact sharing impact * EUR mio 3M 12 3M 13 3M 12 3M 13 3M 12 3M 13 Life 30 30 (13) (7) 17 23 Non-Life 3 5 (1) (1) 2 4 Total Belgium 33 35 (14) (8) 19 27 Life Non-
Slide 7: Belgium: Headlines
Belgium : Headlines Non-Life performance up, Life inflows suffering from premium tax & low interest rates Net result: increase in Non-Life partly Anticipated inflow decrease in Life Life Technical liabilities offset by Life marginally up In EUR mio In EUR mio (9%) In EUR bn 1,794 1,633 78 80 535 5 5
Slide 8: United Kingdom: Headlines
United Kingdom: Headlines Non-Life performance substantially up, inflows broadly flat Net result: Non-Life performance up Inflow in line at constant FX Other: Income nearly stable In EUR mio In EUR mio In EUR mio (1%) 552 545 23 17 4 3 534 520 68 63 20 14 (0) (1) 18 25 3M 12 3M 13 3M 12 3M 13 3M 12
Slide 9: Continental Europe: Headlines
Continental Europe: Headlines Strong inflow & stable net profit Net result in line with last year Inflow* increase in all main countries Life Technical liabilities* In EUR mio In EUR mio In EUR bn 1,128 +8% 1,215 17 18 292 275 3 5 28.1 28.9 853 923 14 13 3M 12 3M 13 3M 12 3M 13 FY 12 3M 13 Life Non-
Slide 10: Asia: Headlines
Asia: Headlines Pressure on profit in Life from boost in new business / Profitable organic growth in Non-Life Net result: Life down on China mainly Inflow* fuelled by China & Thailand Life Technical liabilities* up 12% In EUR mio In EUR mio In EUR bn 3,360 43 +54% 243 4 38 2,177 6 215 3,117 39 24.4
Slide 11: General Account: Headlines
General Account: Headlines Result driven by transaction RPI & Call option, Net cash expected to increase by EUR 1.0 bn Net result* P&L impact recent transaction Proposal distribution additional In EUR mio In EUR mio EUR 1.0 through capital reduction 136 No withholding tax 232 3M 12 3M 13 Credito
Slide 12: Investment portfolio as per 31 March 2013
Investment portfolio as per 31 March 2013 Increased allocation to loans; unrealized gains slightly down In EUR bn Total portfolio 75.9 76.8 Gross unrealized gains/losses slightly down to 2.4 2.0 Cash & equivalents EUR 6.4 bn (EUR 6.7 in FY 12) ; exclusively 4.7 4.9 2.7 down in fixed income 2.4 6.3
Slide 13: IFRS Solvency as per 31 March 2013
IFRS Solvency as per 31 March 2013 Insurance & total solvency ratio stable In EUR bn Belgium RMC Excess Capital UK RMC Excess Capital CEU RMC Excess Capital 9.4 9.1 Asia RMC Excess Capital Total Ageas RMC Excess Capital 8.3 8.1 General Account Available Capital 5.3 5.1 4.2 4.1 4.1 4.2 1.7 1.8 1.6 4.
Slide 14: Conclusions
Conclusions Insurance : Good profit levels – no material one-offs Record inflows – opposite trends in Europe & Asia General Account: Further progress in solving legacies with further reduction complexity – transaction RPI & Call Option Successful placement of new debt instruments Distribut
Slide 15: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance Activities Investment portfolio General Account General Information
Slide 16: Shareholders' equity as per 31 March 2013
Shareholders’ equity as per 31 March 2013 Up on net profit, offset by lower unrealized gains & revaluation put option In EUR mio Shareholders’ equity / share EUR 42.75 EUR 42.27 EUR 42.74 9,911 9,799 9,799 (111) 157 136 (181) (65) (66) 18 1,673 1,655 1,521 Insurance 1,931 Insurance 1,838 1,728 Insur
Slide 17: Tangible net equity as per 31 March 2013
Tangible net equity as per 31 March 2013 High quality capital structure EUR bn FY 12 3M 13 IFRS Shareholders' Equity 9.8 9.8 Unrealised gains real estate 0.6 0.6 Goodwill (0.7) (0.7) VOBA (Value of Business Acquired) (0.4) (0.4) DAC (Deferred Acquisition Cost) (0.9) (0.9) Other (0.4) (0.4) Goodwill,
Slide 18: IFRS Solvency as per 31 March 2013
IFRS Solvency as per 31 March 2013 Insurance & total solvency ratio stable In EUR bn Belgium RMC Excess Capital UK RMC Excess Capital CEU RMC Excess Capital 9.4 9.1 Asia RMC Excess Capital Total Ageas RMC Excess Capital 8.3 8.1 General Account Available Capital 5.3 5.1 4.2 4.1 4.1 4.2 1.7 1.8 1.6 4.
Slide 19: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance activities Investment portfolio General Account General Information
Slide 20: Inflows @ 100%
Inflows @ 100% Growth driven by China, Thailand & inclusion Groupama Life Non-Life Total EUR mio 3M 12 3M 13 3M 12 3M 13 3M 12 3M 13 Belgium 75% 1,259 1,068 535 565 1,794 1,633 United Kingdom * 0%/100% 18 25 534 520 5520 5450 Continental Europe 853 923 275 292 1,128 1,215 Consolidated entities 269 3
Slide 21: Inflows @ Ageas's part
Inflows @ Ageas’s part Strong growth in emerging markets, Life Belgium under pressure In EUR mio 10% Belgium Life Non-Life UK Life Non-Life 3,208 CEU Life Non-Life Asia Life Non-Life 2,927 Total Ageas Life Non-Life 1,062 1,011 (9%) 1,345 1,225 49% 401 955 424 2,146 66 1,917 5% 14% 641 486 477 542 58
Slide 22: Insurance net result
Insurance net result Non-Life up in all segments, Life suffering from low i-rates & boost new business in Asia In EUR mio Belgium Life Non-Life UK Life Non-Life Other CEU Life Non-Life Asia Life Non-Life 155 157 Total Ageas Life Non-Life Other 3 4 26 46 78 80 5 16 126 108 43 4 37 73 6 64 23 17 4 17
Slide 23: Insurance lexicon on margin disclosures
Insurance Lexicon on new margin disclosures as from FY 2012 Life Non-Life + Underwriting + Premiums received from policyholders + Net Underwriting + Net Earned Premium result - actual payments made in risk contracts result - all evolutions in claims reserves (CY & PY) + penalties deducted in case of
Slide 24: Insurance Combined ratio
Insurance Combined ratio Below 100% in quarter traditionally impacted by winter conditions Combined ratio at 99.5% vs. 101.9% Q1 traditionally impacted by winter conditions 106.0% 102.5% 100.1% 101.5% 101.9% Motor at 102.1% (vs. 98.9%): premium strain on 99.1% 99.5% 32.8% expense ratio in UK 33.
Slide 25: Insurance Combined ratio per product line
Insurance Combined ratio per product line Household strongly improving Accident & Health: good performance confirmed Motor: expense ratio up in UK & to lesser extend in CEU 108.3% 107.4% 99.1% 99.0% 98.9% 102.1% 94.0% 96.9% 96.0% 93.8% 97.3% 90.7% 29.3% 29.0% 24.8% 25.0% 25.3% 25.4% 25.2% 28.6% 23.6
Slide 26: Insurance Life operating margin
Insurance Life operating margin Diverging evolutions in different countries Total Life: down on investment margin Guaranteed: down on investment margin 1.05% 0.90% 1.13% 0.76% 0.81% 0.72% 0.68% 0.66% 0.56% 0.72% 0.84% 0.64% 1.02% 0.87% 0.78% 0.48% 0.52% Expense & other m. 0.67% (0.60%) Investment m.
Slide 27: Belgium: Headlines
Belgium : Headlines Non-Life performance up, Life inflows suffering from premium tax & low interest rates Net result: increase in Non-Life partly Anticipated inflow decrease in Life Life Technical liabilities offset by Life marginally up In EUR mio In EUR mio (9%) In EUR bn 1,794 1,633 78 80 535 5 5
Slide 28: Belgium: Inflow
Belgium: Inflow Anticipated decrease in Guaranteed products partly compensated by Non-Life Guaranteed Life Sales of guaranteed products decreased 27% to EUR 887 mio In EUR mio Decrease observed in Individual Saving (down 38% to EUR 530 mio) and Individual Traditional (down 18% to EUR 61 mio) 1,2
Slide 29: Belgium: Combined ratio
Belgium: Combined ratio Improved underwriting performance in Household Combined ratio at 99.7% vs. 104.1% 105.1% 104.1% Household (100.2%) significantly improved 100.9% 101.1% 99.5% 98.6% 99.7% stemming from previous corrective measures, further rate increases & less weather related 36.4% 36.9% cl
Slide 30: Belgium: Combined ratio per product line
Belgium: Combined ratio per product line Improved underwriting performance in Household & Other Acc & Health: satisfactory vs strong Q1 12 Motor: slightly lower PY releases, almost offset by improved CY 104.8% 106.7% 102.5% 97.7% 97.6% 100.5% 101.5% 97.0% 95.1% 94.2% 91.5% 91.0% 21.9% 23.8% 36.3% 35
Slide 31: Belgium: Life operating margin
Belgium: Life operating margin Decrease by 0.3% mainly driven by lower investment margin Total Life: y-o-y decrease by 0.3% 1.03% Guaranteed: investment margin 0.91% 1.09% 0.96% 0.73% 0.77% 0.67% 0.64% 0.64% 0.99% 1.11% 0.84% 0.93% 0.70% 0.78% 0.56% 0.57% 0.49% (0.78%) (0.64%) 0.28% 0.32% 0.32% 0.29
Slide 32: United Kingdom: Headlines
United Kingdom: Headlines Non-Life performance substantially up, inflows broadly flat Net result: Non-Life performance up Inflow in line at constant FX Other: Income nearly stable In EUR mio In EUR mio In EUR mio (1%) 552 545 23 17 4 3 534 520 68 63 20 14 (0) (1) 18 25 3M 12 3M 13 3M 12 3M 13 3M 12
Slide 33: United Kingdom: Inflow
United Kingdom: Inflow Inflow levels in line with 3M 12 at constant exchange rates Total In EUR mio Life 552 545 Successful roll out of its proposition across the IFA market and (1%) through affinity partnerships developed in 2012 18 25 Life Over 275,000 customers up 30% on same period last year
Slide 34: United Kingdom: Combined ratio
United Kingdom: Combined ratio Below 100% in a typically difficult first quarter Combined ratio at 99.9% Combined ratio continued sub 100% 108.1% 109.5% performance even 106.0% 99.9% 99.8% 102.3% 99.9% 27.7% 28.0% 27.6% First full quarter impact of Groupama. 25.3% 26.5% 25.6% 30.5% Composition o
Slide 35: United Kingdom: Combined ratio per product line
United Kingdom: Combined ratio per product line Reduced loss ratios in all products, partially offset by expense ratios Accident & Health: AIL improvement, positive impact GICL Motor: premium strain on expense ratio (TU) 121.9% 111.7% 109.7% 110.9% 106.2% 101.8% 24.0% 106.3% 103.4% 98.7% 98.5% 98.0%
Slide 36: Continental Europe: Headlines
Continental Europe: Headlines Strong inflow & stable net profit Net result in line with last year Inflow* increase in all main countries Life Technical liabilities* In EUR mio In EUR mio In EUR bn 1,128 +8% 1,215 17 18 292 275 3 5 28.1 28.9 853 923 14 13 3M 12 3M 13 3M 12 3M 13 FY 12 3M 13 Life Non-
Slide 37: Continental Europe: Inflow
Continental Europe: Inflow Up 8% to EUR 1.2 billion Life Life Inflow +8%, including non-controlling interests @ 100%, reflecting In EUR mio higher sales in Portugal and France +8% 923 Consolidated inflow up 28% 853 Portugal: volumes up by 17% driven by the UL business and 409 Savings 421 Unit-
Slide 38: Continental Europe: Combined ratio
Continental Europe: Combined ratio Below group target even as severe winter weather impacts Portugal Combined ratio at 96.7% 101.3% Combined ratio higher than PY mainly due to 96.7% 99.3% 96.7% 93.4% severe weather impact in Portugal. 90.0% 90.3% 30.3% 29.2% 28.9% Claims ratio at 67.8% 30.3% 29.8%
Slide 39: Continental Europe: Combined ratio per product line
Continental Europe: Combined ratio per product line Overall combined ratio within expectations (only related to consolidated companies) Accident & Health: product mix drives increase in Motor: positive PY 3M 12 due to review of old claims commission ratio 117.5% 95.9% 95.8% 91.5% 104.7% 91.3% 89.3%
Slide 40: Continental Europe: Life operating margin
Continental Europe: Life operating margin Encouraging operating margin Total Life Guaranteed: underwriting margin down 0.76% 0.90% 0.73% 0.72% 1.16% 0.57% 1.02% 1.15% 0.39% 0.37% 0.89% 0.84% 0.63% 0.42% 0.70% 0.33% (0.22%) 0.45% (0.83%) 0.76% 1.25% 1.18% 1.24% 0.72% 1.00% 0.89% 0.67% 0.49% 0.57% 0.4
Slide 41: Asia: Headlines
Asia: Headlines Pressure on profit in Life from boost in new business / Profitable organic growth in Non-Life Net result: Life down on China mainly Inflow* fuelled by China & Thailand Life Technical liabilities* up 12% In EUR mio In EUR mio In EUR bn 3,360 43 +54% 243 4 38 2,177 6 215 3,117 39 24.4
Slide 42: Asia: Inflow
Asia: Inflow Strong organic growth, boosted by very successful sales campaign Life Life Hong Kong, +19%, Strong growth of 50% in new business premiums, in both IFA & agency channels In EUR mio China, +74%, Extraordinarily successful sales campaign in bank channel 3.117 pushed single premium sale
Slide 43: Hong Kong: Life operating margin
Hong Kong: Life operating margin Positive margin evolutions offset by non-recurring positive result in previous years Total Life: all margins improving Guaranteed: improved investment margin 4.77% 2.92% 3.80% → new calculation methodology, 0.41% based on best estimates 1.30% 2.24% 2.77% 2.99% 2.26%
Slide 44: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance Activities Investment portfolio General Account General Information
Slide 45: Investment portfolio as per 31 March 2013
Investment portfolio as per 31 March 2013 Increased allocation to loans; unrealized gains slightly down In EUR bn Total portfolio 75.9 76.8 Gross unrealized gains/losses slightly down to 2.4 2.0 Cash & equivalents EUR 6.4 bn (EUR 6.7 in FY 12) ; exclusively 4.7 4.9 2.7 down in fixed income 2.4 6.3
Slide 46: Sovereign & Corporate bond portfolio as per 31 March 2013
Sovereign & Corporate bond portfolio as per 31 March 2013 Stable sovereign bond portfolio & increased part of investment grade industrials In EUR bn Sovereign bond portfolio* Corporate bond portfolio* 34.7 34.7 Others 25.1 25.3 3.2 3.3 The Netherlands 0.7 0.5 1.3 1.4 2.9 2.8 Germany 7.8 7.5 3.3 3.4
Slide 47: Loan & Equity portfolio as per 31 March 2013
Loan & Equity portfolio as per 31 March 2013 Increased loans to banks In EUR bn Loan portfolio (customers + banks)* Equity portfolio* 6.8 6.3 2.1 2.7 2.0 2.4 0.6 0.4 1.5 Other 1.5 0.7 0.1 0.7 0.1 Mortgages Mixed funds & others 0.1 0.1 0.1 0.1 Infrastructure Real Estate funds 2.6 3.0 Real Estate Equi
Slide 48: Real estate portfolio as per 31 March 2013
Real estate portfolio as per 31 March 2013 In EUR bn Real Estate portfolio* 4.7 4.9 0.3 0.3 0.6 0.6 Investment 1.3 1.3 Warehouses RE Development 1.1 1.1 Investment Retail Car Parks 1.5 1.6 Investment Offices FY 11 3M 13 Gross UG/L stable at EUR 1.3 bn (not reflected in net equity) Value increase
Slide 49: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance Activities Investment portfolio General Account General Information
Slide 50: General Account: Headlines
General Account: Headlines Result driven by transaction RPI & Call option, Net cash expected to increase by EUR 1.0 bn Net result* P&L impact recent transaction Proposal distribution additional In EUR mio In EUR mio EUR 1.0 through capital reduction 136 No withholding tax 232 3M 12 3M 13 Credito
Slide 51: Ageas announces further steps in solving legacy issues
Ageas announces further steps in solving legacy issues Agreements re Royal Park Investments & Call option on BNP Paribas shares P&L impact of EUR 142 mio in Q1 13 RPI disposes of almost all of its assets to Lone Star & Crédit Suisse RPI EUR 520 mio @ 100% EUR 232 mio @ Ageas part Remaining a
Slide 52: General Account: components of Net result
General Account: components of Net result After agreements in 2012; further simplification of legacy issues In EUR mio (90) 10 (5) (5) (6) 232 136 RPI BNP Call Reval Staff exp. Op.& admin. Other General option RPN(i) exp. Account = solved legacy issues Periodic financial Information I 3M 13 Results
Slide 53: Net cash position General Account at EUR 1.1 bn
Net cash position General Account at EUR 1.1 bn Slightly down on buy-back & capital increase China, EUR 1 bn to be received in EUR mio FY 12 3M 13 cash inflow on transactions RPI & BNP Call Cash and cash equivalents 402 245 option Due from banks 1,000 1,000 expected increase of EUR 1bn after Deb
Slide 54: Net cash equally spent over alternative uses
Net cash equally spent over 3 alternative uses Balanced use of cash since 2009 Invest in Businesses Return to shareholders Return to debtholders Organic growth Dividend payment Redemption of Debt (EMTN) Selective acquisitions Share buy-back Create new partnerships May 2009 – May 2013: +/
Slide 55: Legal proceedings at 31 March 2013
Legal proceedings at 31 March 2013 Managed in interest of shareholders Administrative proceedings AFM fine imposed 05/02/10 re price sensitive info June 08 Appeal filed against both before The Hague “College van Beroep voor het bedrijfsleven”; proceedings ongoing AFM 2nd fine imposed 19/08/10
Slide 56: Changes in hybrid debt composition
Changes in hybrid debt composition Succesful debt placement for total amount of USD 800 mio in March-April 13 Succesful placement hybrid debt by AG Insurance Succesfull placement hybrid debt by HK-entity Subordinated Perpetual Note of USD 550 mio 10-year senior debt of USD 250 mio end March 20
Slide 57: Main characteristics Hybrids at 31 March 2013
Main characteristics Hybrids at 31 March 2013 Hybrone partly tendered securities & NITSH II to be called at first call date EUR mio Ageas Fortis Bank (now BNP Paribas) Ageas Hybrid Ageas Hybrid Ageas Hybrid Direct issue Ageasfinlux Financing Financing Financing CASHES* Fresh FBB, 2004 Hybrone Nitsh
Slide 58: Executive summary / Annexes
Executive summary Annexes Equity / Solvency Insurance Activities Investment portfolio General Account General Information
Slide 59: Summary of resolutions AGM April 2013
Summary of resolutions AGM April 2013A 2012 gross dividend of EUR 1.2 per share approved at AGM Shareholders have approved all submitted subjects. Cancellation of shares bought back during program announced on 6 August 2012 up to and including 15 February 2013 Payment of a gross cash dividend
Slide 60: Total number of outstanding shares
Total number of outstanding shares Bought back shares cancelled following approval AGM April 2013 situation 31/12/2011 situation 31/12/2012 situation 15/05/2013 Total Issued Shares 2,623,380,817 243,121,272 233,955,818 Shares not entitled to dividend and voting right 340,160,729 15,669,850 9,083,113
Slide 61: Financial calendar 2013
Financial calendar 2013 Extraordinary shareholders’ meeting in September re EUR 1 distribution 20 February 15 May 2 August 6 November Annual results 3M 2013 6M 2013 9M 2013 2012 results results results 14 March Annual report 2012 26 April 6 May 21 September 20 November Ex date Payment 2012 Ex date P
Slide 62: Rating
Rating S&P MOODY'S FITCH Operating entities AG Insurance (Belgium) Insurance Financial Strength A- / stable A2 / negative A+ / stable Last change 29/11/12 26/07/12 14/12/12 Millenniumbcp Ageas (Portugal) Insurance Financial Strength BB / negative BBB- / negative Last change 17/01/12 25/11/11 Ageas I
Slide 63: Save The Date! Investor's Update
Save The Date ! Investor’s Update On Vision 18 September 2015 2013 After market closes Andaz London
Slide 64: Disclaimer
Disclaimer Certain of the statements contained herein are statements of future expectations and other forward-looking statements that are based on management's current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events t
Slide 65: Investor Relations
Investor Relations Tel: + 32 2 557 57 34 E-mail: [email protected] Website: www.ageas.com Investor Relations Periodic financial Information I 3M 13 Results I 15 May 2013 64