Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — FY2013 Earnings Presentation
56 slides from Vienna Insurance's earnings presentation, Apr 10, 2014
Slide 1: 12M 2013 Results Presentation
12M 2013 Results Presentation Conference call for the results of the financial year 2013 Vienna, 10 April 2014
Slide 2: Presenting team and topics
Presenting team and topics Presenting team Topics Peter Hagen, CEO 2013 Summary p. 3 Martin Simhandl, CFO Financial Highlights p. 5 Peter Höfinger, Member of the Managing P&L and Balance Sheet p. 18 Board Regional Segments p. 21 Roland Gröll, Head of Group Finance and Accounting
Slide 3: 2013 at a glance
2013 at a glance SUMMARY Market leader in Austria and in CEE core markets Excellent capitalisation and capital ratios Sustainable reduction of administrative costs in the Group Solid operating performance Low interest yield environment Pricing pressure in motor business Macroeconomic e
Slide 4: Solid performance with substantial one-offs in 2013
Solid performance with substantial one-offs in 2013 A multi-themed year for VIG SUMMARY • No.1: VIG is market leader in CEE with 18.2% market share in core markets1 Operational • € 9.2bn premiums – adjusted for STEP, Romania and FX, up by 2.8% stability • Solid adjusted result of ~ € 570mn excluding
Slide 5: Stable premium development excl. Polish STEP
Stable premium development excl. Polish STEP FINANCIAL Premiums in Remaining markets in CEE further increased HIGHLIGHTS Gross written premiums (€mn; y-o-y chg.) GWP regional split y-o-y chg. -4% 9,646 Austria 4,074 -1% 6 9,219 Health 392 Czech Republic 1,762 -2% -55 398 -379 Slovakia 745 6% Lif
Slide 6: Profit before taxes affected by Italy and Romania
Profit before taxes affected by Italy and Romania Adjusted* performance of roughly € 570mn FINANCIAL HIGHLIGHTS Profit before taxes (€mn; y-o-y change) PBT regional split y-o-y chg. -37% Austria 233 -21% 564 Health 31 Czech Republic 198 1% Slovakia 55 -3% Life 201 61 4 355 Poland 50 21% 36 Roman
Slide 7: Broad geographical diversification of VIG
Broad geographical diversification of VIG FINANCIAL Contribution of regional segments to GWP and PBT in 2013 HIGHLIGHTS GWP: 45% 19% 8% 12% 4% 12% Austria: 45% GWP / 66% PBT Poland: 12% GWP / 14% PBT GWP decreased 1% due to reduction of Italian branch GWP decreased (-29%) with deliberate red
Slide 8: Remaining markets and CEE growing profitably
Remaining markets and CEE growing profitably FINANCIAL Profitable development over the years HIGHLIGHTS PBT CEE excl. Romania (€mn) GWP CEE excl. Romania (€mn) CAGR CAGR 19% 6% 316 323 4,852 281 4,448 4,104 3,741 190 12M10 12M11 12M12 12M13 12M10 12M11 12M12 12M13 PBT Remaining markets (€mn)
Slide 9: Steady growth in non-motor business
Steady growth in non-motor business FINANCIAL More profitable non-motor business with strong CAGRs HIGHLIGHTS CZ premium split (€mn) SK premium split (€mn) CAGR 08-13 CAGR 08-13 738 837 870 15% 437 380 419 9% 275 341 2% 552 585 624 607 3% 94 100 107 110 4% 544 514 2% 246 218 222 222 456 439 2008
Slide 10: Successful corporate and SME Group initiative
Successful corporate and SME Group initiative FINANCIAL VIG to grow further in underpenetrated SME segment HIGHLIGHTS P/C corporate premiums (€mn) P/C SME premiums (€mn) +10% +8% 775 258 703 238 12M12 12M13 12M12 12M13 Remarks Remarks Corporate premiums with high growth rates in Austria
Slide 11: Solid profit development adjusted for one-offs
Solid profit development adjusted for one-offs FINANCIAL Extensive measures taken in Italy and Romania HIGHLIGHTS Measures influencing PBT (€mn) 79 ~570 53 30 -47 100 355 12M13 reported Impairments Other Measures Measures Other one-offs 12M13 adjusted Romania impairments Italy Romania Impacts 20
Slide 12: Restructuring actions taken for Italy
Restructuring actions taken for Italy FINANCIAL Reserving level >100% for Italian MTPL to impact result in 2014 HIGHLIGHTS Reduction in Italian premiums (€mn) Measures taken Continuous reduction of Italian motor business Regional refocus towards the North of Italy -31% -35% Changes in mana
Slide 13: Kitchen sinking in Romania
Kitchen sinking in Romania FINANCIAL VIG taking substantial measures HIGHLIGHTS Focus on non-motor business in Romania Measures taken in figures excl. impairments (€mn) 60 79 12M11 12M12 12M13 24% 29% 29% 29% 39% 38% 15 4 19 36% 42% 33% Non-motor Casco MTPL HY Q3 9M Q4 12M2013 Implementation o
Slide 14: Romania and Italy deteriorate combined ratio
Romania and Italy deteriorate combined ratio FINANCIAL Cost ratio rather stable despite shift to non-motor HIGHLIGHTS CoR 12M development (net, %) CoR 12M y-o-y countries development (net, %) +3.9pp 94.7 AT +6.7pp 101.4 96.7 100.6 87.3 CZ +4.2pp 91.5 SK 91.6 +2.0pp 12M12 93.6 Claims ratio 65.9 6
Slide 15: Sustainable cost management over the years
Sustainable cost management over the years FINANCIAL Decreasing costs strengthen VIGs competitive position HIGHLIGHTS P&C administrative cost ratio decreasing1 (%) Administrative cost ratio by segments Personnel 8% CAGR 7.7 Material -7% 7.1 6.6 6% 6.0 5.7 3.8 5.3 5.1 3.4 3.3 4% 3.2 2.9 2.7 2.6 2
Slide 16: Dividend proposal of € 1.30 per share
Dividend proposal of € 1.30 per share1 Increase of € 0.10 compared to last year DIVIDEND Dividend per share (€) Dividend pay out (€mn) 8% 1.30 166.4 1.20 153.6 1.10 140.8 1.00 128.0 2010 2011 2012 2013p 2010 2011 2012 2013p Dividend policy Unchanged dividend policy with a pay-out ratio of mi
Slide 17: Management assessment
Management assessment FINANCIAL Medium-term view HIGHLIGHTS Growth above market due to strong market shares and unique distribution network of VIG Maintaining sound capital ratios – also with Solvency II regulations Ongoing Group wide optimisation and increased profitability -> CoR below 96%
Slide 18: P&L and Balance Sheet Overview
P&L and Balance Sheet Overview Vienna Insurance Group – 12M 2013 Results Please note: The figures for 2012 have been restated to reflect the changes out of the review of BCR Life according to IAS 8.41 as well as the retrospective application of the amended IAS 19 standard
Slide 19: 12M 2013 – Income statement
12M 2013 – Income statement P&L AND BALANCE IFRS (€mn) SHEET OVERVIEW €mn 12M 2013 12M 2012 +/-% Gross premiums written 9,218.6 9,646.0 -4.4 Net earned premiums 8,479.1 8,972.3 -5.5 1 Financial result 1,218.8 1,242.3 -1.9 Other income 143.9 115.3 24.8 Total income 9,841.8 10,329.9 -4.7 Expenses for
Slide 20: 12M 2013 – Balance sheet
12M 2013 – Balance sheet P&L AND BALANCE IFRS (€mn) SHEET OVERVIEW €mn 31.12.2013 31.12.2012 +/-% Intangible assets 2,266 2,410 -6.0 Investments 29,201 29,463 -0.9 Unit- and index-linked investments 6,707 6,444 4.1 Reinsurers’ share in underwriting provisions 1,028 1,034 -0.6 Receivables 1,561 1,618
Slide 21: Regional Segments
Regional Segments Vienna Insurance Group – 12M 2013 Results
Slide 22: Austria with stable premium development
Austria with stable premium development REGIONAL Italian branch office business of Donau deteriorates Austrian CoR SEGMENTS GWP for 12M 2013 (€mn) P&C GWP direct business split 1 -1.2% 4,123 4,074 MTPL 23% P&C 1,897 (27%) 1,872 Health 348 357 14% 63% (60%) (13%) Casco Other NL Life 1,878 1,845 1
Slide 23: CZ: profit increased despite weather related claims
CZ: profit increased despite weather related claims REGIONAL GWPs adjusted for FX effects slightly increased in 12M 2013 SEGMENTS GWP for 12M 2013 (€mn) Non-life GWP direct business split1 -1.9% 1,796 1,762 MTPL 29% Non-life 958 892 (28%) 51% Other NL (52%) 21% Life 837 870 (19%) Casco 12M12 12M
Slide 24: Slovakia – overall sound business development
Slovakia – overall sound business development REGIONAL Life premiums increased by ~10% y-o-y SEGMENTS GWP for 12M 2013 (€mn) Non-life GWP direct business split 1 +5.8% 745 704 Other NL 32% 326 Non-life 324 (32%) 41% MTPL (41%) Life 380 419 27% (27%) Casco 12M12 12M13 P&L: Non-life business (€m
Slide 25: Polish profit increase of 21%
Polish profit increase of 21% REGIONAL Strong result and combined ratio for VIG in Poland SEGMENTS GWP for 12M 2013 (€mn) Non-life GWP direct business split 1 -29.1% 1,612 MTPL Non-life 587 1,142 33% Other NL 41% (37%) (35%) 560 Life 1,025 582 26% (28%) Casco 12M12 12M13 P&L: Non-life business
Slide 26: Romania – ongoing adverse market environment
Romania – ongoing adverse market environment REGIONAL Extensive restructuring deteriorates results and CoR SEGMENTS GWP for 12M 2013 (€mn) Non-life GWP direct business split 1 -11.5% 409 362 MTPL 29% Other NL 38% (29%) (29%) Non-life 334 300 33% Life 75 62 (42%) Casco 12M12 12M13 P&L: Non-life
Slide 27: Remaining markets growing profitably
Remaining markets growing profitably REGIONAL GWP from remaining CEE countries up by 8% in 12M 2013 SEGMENTS GWP for 12M 2013 (€mn) Non-life GWP direct business split 1 +8.8% MTPL 1,062 976 20% (24%) 607 Non-life 561 58% 22% 40 Other NL (53%) (23%) Casco Health 44 Life 371 414 12M12 12M13 P&L:
Slide 28: Investments and Equity
Investments and Equity Vienna Insurance Group – 12M 2013 Results Please note: The figures for 2012 have been restated to reflect the changes out of the review of BCR Life according to IAS 8.41 as well as the retrospective application of the amended IAS 19 standard
Slide 29: 12M 2013 – Financial result rather stable
12M 2013 – Financial result rather stable Net realised gains of roughly € 120mn INVESTMENTS Income P&C Life Health Total in € '000 12M 2013 12M 2012 12M 2013 12M 2012 12M 2013 12M 2012 12M 2013 12M 2012 Current income 354,536 405,069 889,312 909,175 42,484 45,238 1,286,332 1,359,482 Income from appr
Slide 30: 12M 2013 – Investment split
12M 2013 – Investment split Well diversified bond portfolio INVESTMENTS 12M 2013: Total € 29.9bn Bond portfolio by rating1 Other 4% 6% 13% 12% BBB 6.7% 2.9% A 37% 38% 0.2% 11.1% AA 28% 28% AAA 18% 16% 9.4% YE 2012 YE 2013 3.9% Bond portfolio by issuer 65.9% Corporates 9% 13% Financials 26% 23%
Slide 31: 12M 2013 – Strong equity and solvency position
12M 2013 – Strong equity and solvency position Shareholders’ equity impacted by repurchase of hybrid capital EQUITY Change in Group Shareholders’ Equity (€mn) -12% 256 5,689 -142 -72 5,020 -222 -203 -250 -30 -6 Equity Profit for Currency AFS Changes in Dividend Repurchase of IAS19 At equity Equity
Slide 32: Successful bond issue
Successful bond issue VIG launched € 500mn 30NC10 subordinated notes BOND TRANSACTION Rational for bond transaction Impacts Repurchase of Tranche 2 of the Hybrid Debt Bond issue strengthens the capital position of VIG Issuance Programme (EUR 250mn/coupon 8.0%) as this tranche was not conside
Slide 33: Group Embedded Value 2013
Group Embedded Value 2013 Vienna Insurance Group – 12M 2013 Results
Slide 34: Group embedded value 2013
Group embedded value 2013 Return on GEV (€mn) EMBEDDED VALUE 48 6,153 562 5,868 5,852 -16 -154 5,543 -155 GEV 2012 Restatement GEV 2012 Dividends FX effects GEV 2012 Return in L&H Return in P&C GEV 2013 reported changes restated and others adjusted Remarks Group Embedded Value up by 5.1% to € 6,
Slide 35: Group embedded value 2013 – Austria/Germany MCEV
Group embedded value 2013 MCEV of Life & Health business in Austria/Germany (€mn) EMBEDDED VALUE 269 2,477 214 54 36 1,981 -77 Operating Economic MCEV 2012 Value of New Roll forward Assumption changes Operating variance Investment MCEV 2013 adjusted Business 2013 income and others Remarks Operat
Slide 36: Group embedded value 2013 – CEE MCEV
Group embedded value 2013 MCEV of Life & Health business in CEE (€mn) EMBEDDED VALUE 21 123 -50 1,566 0 -27 1,500 Operating Economic MCEV 2012 Value of New Roll forward Assumption changes Operating variance Investment MCEV 2013 adjusted Business 2013 income and others Remarks Profitability in CE
Slide 37: Appendix
Appendix Vienna Insurance Group – 12M 2013 Results Please note: The figures for 2012 have been restated to reflect the changes out of the review of BCR Life according to IAS 8.41 as well as the retrospective application of the amended IAS 19 standard
Slide 38: Restatement of the results 2012
Restatement of the results 2012 For more details please see annual report 2013 APPENDIX P&L (€mn) Restatement out of Romanian unit BCR Life. Auditor’s review finalised beginning of 2014. Far reaching restructuring of BCR Life and as a consequence and in accordance with IAS 8.41 restatement of fina
Slide 39: 12M 2013 Key financials
12M 2013 Key financials Overview APPENDIX Net Profit after tax and minorities (€mn) Combined Ratio (net, %) 407 426 96.8 96.7 100.6 235 2011 2012 2013 2011 2012 2013 EPS1 (€) ROE before Taxes (%) 2.87 3.01 11.1 10.5 6.6 1.57 2011 2012 2013 2011 2012 2013 1: EPS net of hybrid interest, annual
Slide 40: 12M 2013 P&L – Property & Casualty
12M 2013 P&L – Property & Casualty IFRS (€mn) APPENDIX €mn 12M 2013 12M 2012 +/-% Gross premiums written 4,618.4 4,673.4 -1.2 Net earned premiums 3,910.0 4,034.0 -3.1 Financial result 263.2 272.1 -3.3 Other income 85.2 72.7 17.2 Total income 4,258.4 4,378.8 -2.7 Expenses for claims and insurance ben
Slide 41: 12M 2013 P&L – Life
12M 2013 P&L – Life IFRS (€mn) APPENDIX €mn 12M 2013 12M 2012 +/-% Gross premiums written 4,202.4 4,581.1 -8.3 Net earned premiums 4,168.6 4,557.1 -8.5 Financial result 936.4 953.4 -1.8 Other income 58.5 40.7 43.8 Total income 5,163.5 5,551.1 -7.0 Expenses for claims and insurance benefits -4,162.9
Slide 42: 12M 2013 P&L – Health
12M 2013 P&L – Health IFRS (€mn) APPENDIX €mn 12M 2013 12M 2012 +/-% Gross premiums written 397.8 391.5 1.6 Net earned premiums 400.4 381.2 5.0 Financial result 19.3 16.8 14.5 Other income 0.2 1.9 -90.7 Total income 419.8 399.9 5.0 Expenses for claims and insurance benefits -333.6 -320.6 4.0 Acquisi
Slide 43: 12M 2013 – Gross written premiums by region
12M 2013 – Gross written premiums by region Premium decrease of 4.4% y-o-y APPENDIX €mn GWP Non-Life GWP Life GWP Total 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% Austria 2,229.4 2,244.2 -0.7% 1,844.5 1,878.3 -1.8% 4,073.9 4,122.5 -1.2% Czech Rep. 892.0 958.5 -6.9% 870.1 83
Slide 44: 12M 2013 P&L – Split by regions (I)
12M 2013 P&L – Split by regions (I) Regional segments, IFRS (€mn) APPENDIX €mn Austria Czech Republic Slovakia 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% Gross premiums written 4,073.9 4,122.5 -1.2 1,762.1 1,795.6 -1.9 744.7 704.1 5.8 Net earned premiums 3,348.5 3,333.8 0.4
Slide 45: 12M 2013 P&L – Split by regions (II)
12M 2013 P&L – Split by regions (II) Regional segments, IFRS (€mn) APPENDIX €mn Poland Romania Remaining 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% Gross premiums written 1,142.3 1,611.7 -29.1 361.8 408.6 -11.5 1,061.6 975.6 8.8 Net earned premiums 939.7 1,323.2 -29.0 171.0
Slide 46: 12M 2013 P&L – Split by regions (III)
12M 2013 P&L – Split by regions (III) Regional segments, IFRS (€mn) APPENDIX €mn Central Functions Consolidation TOTAL 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% Gross premiums written 1,303.8 1,341.4 -2.8 -1,231.6 -1,313.5 -6.2 9,218.6 9,646.0 -4.4 Net earned premiums 1,16
Slide 47: 12M 2013 – Results by country (I)
12M 2013 – Results by country (I) IFRS (€mn) APPENDIX €mn GWP Non-Life GWP Life GWP Total 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-% Austria 2,229.4 2,244.2 -0.7% 1,844.5 1,878.3 -1.8% 4,073.9 4,122.5 -1.2% Czech Rep. 892.0 958.5 -6.9% 870.1 837.1 3.9% 1,762.1 1,795.6 -1.9%
Slide 48: 12M 2013 – Results by country (II)
12M 2013 – Results by country (II) IFRS (€mn) APPENDIX €mn Profit before Taxes Net Combined Ratio 12M 2013 12M 2012 +/-% 12M 2013 12M 2012 +/-pp Austria 232.7 296.0 -21.4% 101.4% 94.7% 6.7 Czech Rep. 197.8 195.0 1.5% 91.5% 87.3% 4.2 Slovakia 55.3 56.9 -2.9% 93.6% 91.6% 2.0 Poland 50.2 41.6 20.8% 96.
Slide 49: Claims and cost ratio details
Claims and cost ratio details P&C administrative expenses down by 6.7% in 12M 2013 APPENDIX Claims ratio 12M y-o-y regional development (net, %) Remarks for claims incurred 12M12 12M13 Austria: claims ratio up 5.3pp driven by branch office business in +25.3 Italy Czech Republic: increase of
Slide 50: 12M 2013 – Life insurance premium split
12M 2013 – Life insurance premium split IFRS (€mn) APPENDIX Premiums written - direct business 12M 2013 12M 2012 +/- % Regular premiums 2,297 2,264 1.5% Single premiums 1,891 2,300 -17.8% Total premiums written - direct business 4,188 4,564 -8.2% thereof: Policies with profit participation 1,931 2,6
Slide 51: Q4 2013 – Income Statement
Q4 2013 – Income Statement IFRS (€mn) APPENDIX €mn Q4 2013 Q4 2012 +/-% Gross premiums written 2,168.5 2,220.5 -2.3 Net earned premiums 2,114.7 2,227.8 -5.1 Financial result 326.7 341.6 -4.4 Other income 47.0 29.8 57.8 Total income 2,488.4 2,599.2 -4.3 Expenses for claims and insurance benefits -1,8
Slide 52: 12M 2013 – Exchange rates
12M 2013 – Exchange rates APPENDIX 12M 2013 12M 2012 Balance Balance Country Curr. P & L EUR P & L EUR Sheet EUR Sheet EUR Albania EUR/ALL 140.2000 140.2723 139.5900 139.0137 Belarus EUR/BYR 13,080.0000 11,799.1233 11,340.0000 10,717.6230 Bosnia EUR/BAM 1.9558 1.9558 1.9558 1.9558 Bulgaria EUR/BGN 1
Slide 53: VIG Share (I)
VIG Share (I) APPENDIX Current analyst recommendation split Share price development 1Q 2014 Sell High EUR 38.670 Buy Low EUR 33.800 Price as of 31 Mar EUR 35.790 Average daily volume EUR 3.0 mn Market cap. EUR 4.6 bn Development YTD % -1.2 Hold VIG compared to ATX and MSCI Europe Insurance Ind
Slide 54: VIG Share (II)
VIG Share (II) APPENDIX General information Shareholder structure Number of common shares: 128mn Wiener Städtische Wechselseitiger ISIN: AT0000908504 Versicherungsverein - Listings: Vermögensverwaltung – Vienna Insurance Group Free Float Vienna – since 17 Oct. 1994 ~70 % ~30 % Prague – since 5
Slide 55: Contact details
Contact details Investor Relations APPENDIX Financial calendar 2014 Investor Relations Team Date Event Vienna Insurance Group Schottenring 30, 1010 Vienna Preliminary unconsolidated E-Mail: [email protected] 29 Jan. 2014 premiums 2013 www.vig.com/ir 10 April 2014 Results and EV for the
Slide 56: Disclaimer
Disclaimer APPENDIX 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
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