Aegon Ltd. · EURONEXT:AGN
Aegon — Q2 2008 Earnings Presentation
19 slides from Aegon's earnings presentation, Aug 7, 2008
Slide 1: Second quarter 2008 results
Local knowledge. Global power. Second quarter 2008 results Alex Wynaendts, CEO Jos Streppel, CFO Press conference Amsterdam, August 7, 2008
Slide 2: Cautionary note regarding forward-looking statements
Cautionary note regarding forward-looking statements Cautionary note regarding forward-looking statements The statements contained in this presentation that are not historical facts are forward-looking statements as defined in the US Private Securities Litigation Reform Act of 1995. The following ar
Slide 3: Highlights Q2 2008
Highlights Q2 2008 o Strong capital position with excess capital of over EUR 0.8 billion o Solid underlying earnings – down by 2%* o Continued growth of life sales and deposits, VNB up 2%* o Interim dividend of EUR 0.30 per share o New strategy announced at June 2, 2008 o Three strategic priorities
Slide 4: Execution of strategy
Execution of strategy o Securitization of unit linked business in the UK released EUR 315 million, adding to core capital and enhancing financial flexibility o AEGON #2 pension provider in Hungary and #5 in Poland after mergers of acquired pension funds o Acquisition of Turkish life & pensions compa
Slide 5: Solid underlying earnings
Solid underlying earnings o Underlying earnings before tax down 2%* o Americas earnings increased 2%* as result of higher investment spreads o UK earnings declined due to lower fee income and investments in the business Underlying earnings before tax (€ million) 679 (63) 1 (23) (7) 9 596 2% 1% (21)%
Slide 6: Net income affected by financial markets
Net income affected by financial markets o Normal bond trading in Americas and lower gains on investments in the Netherlands lead to losses on investments o Increased impairment charges on US credit and equity investments Net income development (€ million) 655 (83) (1) (136) (94) (30) (35) 276 Q2 07
Slide 7: Continued profitable growth of new life sales
Continued profitable growth of new life sales o Total new life sales up 3%* o Positive momentum in sales of high net worth products in Americas o Sales growth across most lines of business in UK o Strong sales in the Netherlands mainly driven by group pensions Retail life sales New life sales New li
Slide 8: Strong growth in retail deposits
Strong growth in retail deposits o Total net deposits of EUR 971 million o VA deposits in the Americas increased by 5% o FA deposits in the Americas experience best sales quarter since 2003 o Deposits in Other countries triple Variable annuities Fixed annuities Total gross retail deposits Americas A
Slide 9: Shareholders' equity development
Shareholders’ equity development o Shareholders’ equity excluding revaluation reserves is 74% of total capital base – well above target o Decline in revaluation reserves driven by higher interest rates Shareholders’ equity development (EUR million) 12,597 276 (933) 118 (45) (112) (290) (2) 12 11,621
Slide 10: Capital position remains strong
Capital position remains strong o Continued financial strength o Operating units are capitalized at the higher of: – Regulatory requirements, – S&P requirements at AA level and – Economic requirements under AEGON’s economic framework (after full implementation by 2009) o Financial flexibility of EUR
Slide 11: Improved financial flexibility
Improved financial flexibility Financial flexibility (EUR billion) 1.8 o Excess capital over 1.6 EUR 0.8 billion o Leverage capital increased o Recent ViF securitization and possibility of future securitizations are not yet included in financial flexibility at June 30, 2008 31 Mar 08 30 Jun 08 � Add
Slide 12: Interim dividend of EUR 0.30 per share
Interim dividend of EUR 0.30 per share o Dividend policy is to maintain attractive dividend, based on capital and cash flow position o Dividend paid in cash or stock at election of shareholder o Intention to neutralize dilution effect of stock dividend Dividend (EUR) 0.62 0.55 0.31 0.30 0.32 0.30 0.
Slide 13: Limited impairments
Limited impairments o Limited impairments of EUR 98 million pre tax of which: – EUR 57 million US credit impairments incl. EUR 41 million related to US subprime – EUR 26 million related to an US equity position – EUR 15 million other impairments o Almost all fixed income instruments are held as avai
Slide 14: Americas – underlying earnings up 2%
Americas – underlying earnings up 2% o Fundamentals of business remain Underlying earnings before tax (USD million) solid 691 o Higher sales in retail businesses 678 o Strong FA deposits o VA deposits up 5% o VNB up 16% driven by strong fixed Q2 07 Q2 08 annuity production, increased retail life New
Slide 15: The Netherlands – new life sales up 28%
The Netherlands – new life sales up 28% o Continued positive momentum Underlying earnings before tax (EUR million) o Sales up significantly, driven by group pensions and immediate annuities 115 116 o Lower investment performance more than offset by a release of accruals o VNB of EUR 11 million Q2 07
Slide 16: United Kingdom – continued strong sales
United Kingdom – continued strong sales o Sales growth across most lines of Underlying earnings before tax* (GBP million) businesses o Underlying earnings decline due to 48 38 lower financial markets and investments for growth Q2 07 Q2 08 o VNB up 31% on higher margins and volumes New life sales ove
Slide 17: Other countries – strong growth of deposits
Other countries – strong growth of deposits o Deposits tripled driven by retail mutual Underlying earnings before tax* (EUR million) fund and variable annuity sales in Asia 36 o Weakness in financial markets 29 resulted in decline in life sales o VNB decreased to EUR 38 million Q2 07 Q2 08 mainly as
Slide 18: Conclusions
Conclusions o Strong capital position o Solid underlying earnings o Strong momentum in sales o Value of new business on track o Interim dividend of EUR 0.30 per share Local knowledge. Global power. 18
Slide 19: Q&A
Q&A For questions please contact Corporate Communications +31 70 344 8344 [email protected] P.O. Box 85 2501 CB The Hague The Netherlands Local knowledge. Global power. 19