Sava Re,d.d · LJSE:POSR
Sava Re,d.d — Sava Insurance Group — FY2023 Earnings Presentation
32 slides from Sava Re,d.d's earnings presentation, Apr 5, 2024
Slide 1: 2023 audited results
Sava Insurance Group 2023 audited results 5 April 2024
Slide 2: Contents
CONTENTS 01 Group results 02 Segment reporting 03 Financial investments
Slide 3: Group results
GROUP RESULTS
Slide 4: Highlights 2023
Highlights 2023 Growth in gross written premiums of 14.3% In the summer of 2023, Slovenia and the Net profit of €64.7m wider region were hit by a wave of (2022: €46.9m) strongest growth in motor business, storms and floods with a significant reflecting more policies sold and higher impact on profit
Slide 5: Profit target exceeded
Profit target exceeded Profit before tax Net profit €79.6m €64.7m Plan achieved 2023/2022: +36.1% 2023/2022: +37.8% Under the previous accounting standards (IFRS 4 and IAS 39) Under the new accounting standards (IFRS 17 and IFRS 9) Sava Insurance Group / 2023 audited results / Group results 5
Slide 6: Target return on equity exceeded
Target return on equity exceeded Equity Return on equity (ROE) €585.7m 10.8% Plan achieved 2023/2022: +10.2% 2023/2022: +2.5 p.p. Under the previous accounting standards (IFRS 4 and IAS 39) Under the new accounting standards (IFRS 17 and IFRS 9) Sava Insurance Group / 2023 audited results / Group re
Slide 7: Growth in contractual service margin (CSM)
Growth in contractual service margin (CSM) Contractual service margin (CSM) Net contractual service margin (CSM) €155.3m €149.4m 2023/2022: +13.9% 2023/2022: +15.4% Sava Insurance Group / 2023 audited results / Group results 7
Slide 8: Business volume exceeds target due to continued strong growth
Business volume exceeds target due to continued strong growth Business volume Gross premiums written €910.1m €884.6m Plan achieved 2023/2022: +14.4% 2023/2022: +14.3% Sava Insurance Group / 2023 audited results / Group results 8
Slide 9: Market shares
Market shares Slovenia North Macedonia Insurance 20.6% Insurance 8.8% Pensions 10.2%** Pensions 44.2% Asset management 13.1% Croatia Montenegro Insurance 1.1% Insurance 17.3% Serbia Kosovo Insurance 3.6%* Insurance 14.8% Sava Re operates in more than 110 reinsurance markets worldwide. It has a very
Slide 10: Combined ratio within target range
Combined ratio within target range Combined ratio 93.1% Plan achieved 2023/2022: +0.5 p.p. Under the previous accounting standard (IFRS 4) Under the new accounting standard (IFRS 17) and the new combined ratio calculation method Sava Insurance Group / 2023 audited results / Group results 10
Slide 11: Impact of natural catastrophe claims
Impact of natural catastrophe claims Natural catastrophe claims Includes net claims affecting the (re)insurance portfolios of the Group companies resulting from €45.6m natural perils (such as windstorm, flood, 2023/2022: +61.0% earthquake and hail). Sava Insurance Group / 2023 audited results / Grou
Slide 12: Strong growth in assets under management
Strong growth in assets under management Assets under management Investment portfolio €2,411.8m €1,503.3m 2023/2022: +20.2 p.p. 2023/2022: +6.2% Under the previous accounting standard (IAS 39) Under the new accounting standard (IFRS 9) Sava Insurance Group / 2023 audited results / Group results 12
Slide 13: Target return on investment portfolio exceeded
Target return on investment portfolio exceeded Return on investment portfolio Investment portfolio 2.1% €1,503.3m Plan achieved 2023/2022: +1.5 p.p. 2023/2022: +6.2% Under the previous accounting standard (IAS 39) Under the new accounting standard (IFRS 9) Sava Insurance Group / 2023 audited results
Slide 14: Solid solvency position
Solid solvency position Over -capitalisation Additional engagement or return of capital > 250% Optimal Acceptable capitalisation overcapitalisation Seeking ways to restructure capital use 210%–250% Optimal Sprejemljiva nad 250 %presežna kapitaliziranost capitalisation Presežna Measures not Presežna
Slide 15: Select sustainability performance indicators
Select sustainability performance indicators Difference 2022 2023 2023/2022 Environmental aspect CO2 emissions per employee (in tonnes) 1.60 1.45 -9.4% Number of claims reported online 45,288 67,981 +50.1% Group’s ESG integrated investments as at 31/12 14.9% 16.9% +2.0 p.p. Social aspect Number of e
Slide 16: Book value per share and POSR share price performance
Book value per share and POSR share price performance Book value per share Share price at 31/12/2023 Total share return €37.79 €28.00 32.1% 2023/2022: +10.2% 2023/2022: +25.0% 2023/2022: +46.5 p.p. More information on POSR share performance and returns is available at: https://www.sava-re.si/en-si/i
Slide 17: Dividend policy
Dividend policy Dividend policy: distribution of between 35% and 45% of the net profit of the Sava Insurance Group. Dividend as % of consolidated profit PROPOSAL * The 2024 dividend yield depends on the share price movement in the period between the date the dividend is declared and the ex-dividend
Slide 18: Segment reporting
SEGMENT REPORTING
Slide 19: Non-life EU: insurance service result up driven by premium growth
Non-life EU: insurance service result up driven by premium growth • In 2022: adverse impact of change in fair value of • Growth mainly in personal motor, driven by • Impact of higher insurance revenue due to FVTPL investments due to financial market conditions inflation-adjusted price increases and
Slide 20: Life EU: higher profit due to improved financial market developments
Life EU: higher profit due to improved financial market developments • Sales stronger than last year • Insurance service revenue higher reflecting shift in • In 2022: adverse impact of change in fair value of • Business mix shifts towards life risk products with a business mix (more risk policies wi
Slide 21: Reinsurance: improved revenue mix
Reinsurance: improved revenue mix • Price increases in line with reinsurance market • Impact of insurance revenue growth driven by • In 2022: adverse impact of change in fair value of developments and organic business volume growth improved premium mix in favour of non-proportional FVTPL investments
Slide 22: Non-life non-EU: strong premium growth
Non-life non-EU: strong premium growth • Growth in motor, health and property, driven by both • Increased insurance revenue due to growth in gross • Higher interest revenue reflecting portfolio growth organic growth and price increases premiums and higher reinvestment rates Sava Insurance Group / 20
Slide 23: Life non-EU: strong revenue growth
Life non-EU: strong revenue growth • Increased sales through own distribution channels as • Increase in insurance revenue due to portfolio growth • Higher interest revenue reflecting portfolio growth well as through agencies and banks and updated actuarial models and assumptions and higher reinvestm
Slide 24: Pensions and asset management: robust growth in net fund inflows
Pensions and asset management: robust growth in net fund inflows • Growth in assets under management • Increased asset management revenue • Inflationary increases in costs • Positive impact from change in the fair value of FVTPL investments due to favourable financial market conditions (negative imp
Slide 25: "Other" segment: higher profits from healthcare and assistance services
“Other” segment: higher profits from healthcare and assistance services Composition of profit before tax Sava Insurance Group / 2023 audited results / Segment reporting 25
Slide 26: Financial investments
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Slide 27: Net investment income of and rate of return on the investment portfolio
Net investment income of and rate of return on the investment portfolio €m 2022 2023 Difference Interest income at effective interest rate 15.4 20.6 5.2 Change in fair value of FVTPL assets -11.8 3.0 14.7 Gains/losses on disposal of assets -0.4 -0.8 -0.4 Change in expected credit losses (ECL) 0.3 0.
Slide 28: Composition of the investment portfolio
Composition of the investment portfolio €m 31/12/2022 31/12/2023 Difference Fixed-rate investments 1,173.6 1,302.4 128.8 Government bonds 734.5 818.8 84.3 Corporate bonds 420.3 458.0 37.7 Deposits & CDs 18.8 25.6 6.8 Shares and funds 47.0 40.3 -6.7 Shares 24.9 21.8 -3.1 Mutual funds 22.2 18.6 -3.6 A
Slide 29: Classification of investments by accounting category
Classification of investments by accounting category • The increase in FVOCI investments was driven by the reinvestment of funds from the sale of FVTPL equity investments. Sava Insurance Group / 2023 audited results / Financial investments 29
Slide 30: Secure and stable investment portfolio
Secure and stable investment portfolio Sava Insurance Group / 2023 audited results / Financial investments 30
Slide 31: Thank you.
Thank you. For more information: ir@sava-re.si www.sava-re.si
Slide 32: Glossary of selected terms and computation methods for indicators
Glossary of selected terms and computation methods for indicators Assets under management. Assets of pension companies’ pension funds, assets of mutual funds managed by the Group’s asset management company and assets of policyholders who bear the Investment portfolio. It consists of financial invest