Tryg A/s · OMXCOP:TRYG
Tryg A/s — Q2 2014 Earnings Presentation
21 slides from Tryg A/s's earnings presentation, 2014
Slide 1: Q2 and H1 2014 results Webcast presentation
Q2 and H1 2014 results Webcast presentation Follow us on Twitter: @TrygIR
Slide 2: Disclaimer
Disclaimer Certain statements in this presentation are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward-looking statements (other than statements of historical fact) regarding our future results of operations, financ
Slide 3: Highlights Q2 2014
Highlights Q2 2014 - Improved results and positive trend in premium income. Pre-tax profit D KKm 1,150 1,200 • Pre-tax profit of DKK 1,150m (DKK 688m). 1,000 800 688 600 • Technical result of DKK 941m (DKK 684m). 400 200 0 • Combined ratio improved by 6.0 pp. to 80.7 Q2 2013 Q2 2014 (86.7). Combined
Slide 4: Important news in Q2 2014
Important news in Q2 2014 • Many customer focused initiatives initiated. • Customer SMS measuring with strong results • Extended opening hours • 3 new price differentiated products in Norway. • Regular inspection by Danish FSA confirmed satisfactory view on risk control, reserve and capital position
Slide 5: Combined ratio development in business areas
Combined ratio development in business areas Combined ratio – Private (DK & NO) Combined ratio – Commercial (DK & NO) 100 100 95 95 90 87.4 90 88.4 86.7 84.9 85 83.3 85 80.4 78.8 79.1 80 80 75 75 Q2 2013 Q2 2014 H1 2013 H1 2014 Q2 2013 Q2 2014 H1 2013 H1 2014 Group CR Q2 2014: 80.7 Q2 2013: 86.7 Com
Slide 6: Follow up on efficiency programme
Follow up on efficiency programme • Savings of DKK 740m achieved so far. • DKK 93m achieved in Q2 2014. DKKm Targeted and achieved savings on claims • DKK 28m reduction in expenses 1,200 1,000 • DKK 65m reduction in claims 1,000 800 700 740 • Increased benefit from Buildings and Content 550 600 init
Slide 7: Premiums and portfolio
Premiums and portfolio
Slide 8: Topline and technical result
Topline and technical result Gross earned premiums reduced 1.2% (-2.6%) related to: • Continued high retention level in Private and even improved retention level in Commercial. • Higher sales level in general in Private compared to last year. • Commercial – improved retention but sales lower than ex
Slide 9: Private - average premiums
Private - average premiums House insurance – average premium (index 2008 = 100) 150 Average premiums increase Y/Y 140 0.5% 2.6% 130 (Q1 0.6%) (Q1 2.9%) 120 110 100 90 08 09 10 11 12 13 14 20 20 20 20 20 20 20 Motor insurance – average premium (index 2008 = 100) 140 Average premiums increase Y/Y 130
Slide 10: Customer retention
10 Q Q 1 1 82% 84% 86% 88% 90% 92% 82% 84% 86% 88% 90% 92% Q 10 Q 10 2 2 Q 10 3 Q 10 3 Private Q 10 Q 10 Commercial 4 4 Q 10 Q 10 1 1 Q 11 Q 11 2 2 Q 11 Q 11 3 3 Q 11 Q 11 4 4 Q 11 Q 11 1 1 Q 12 Q 12 2 2 Q 12 Q 12 3 3 Q 12 Q 12 4 4 Q 12 Q 12 1 1 Q 13 Q 13 2 2 Q 13 Q 13 3 3 Q 13 Q 13 4 4 Q 13 Custome
Slide 11: Private Sweden – CR and customer retention
11 80 85 90 95 100 105 110 115 120 125 130 Q 1- 10 Q Q 60% 69% 1- 78% 125 2- 10 1 Q 0 Q 2- 103 3- 10 10 Q 3- Q 1 99 4- Q 0 10 4- Q 1 1- Q 0 11 1- 11 Q Q 102 103 2- 2- 11 1 Q Q 1 99 3- 3- 11 11 Q Q 4- 97 4- 1 11 Q 1 1- Q 12 114 1- 12 Q 2- Q 1 Q 2 110 2- 3- 12 1 Q Q 2 95 3- 4- 12 12 Q Q 91 1- 4- 1 Cus
Slide 12: Claims and expenses
Claims and expenses
Slide 13: CR and claims ratios Q2 2013-14
CR and claims ratios Q2 2013-14 • Underlying development is adjusted for: Underlying claims, net Q2 2013/2014 • Large claims • Weather claims 78.7 79.3 76.7 • Run-off and interest 72.3 72.1 70 68.8 72.8 65.6 62.8 • Improved underlying development on Group level driven by: • one-off effects Q2 2013 Q
Slide 14: Large claims, weather claims and run-off
Large claims, weather claims and run-off Large claims, net DKKm Expected annual Weather claims, net DKKm Expected annual level 2014: DKK 550m level 2014: DKK 500m 200 200 150 150 207 100 100 50 50 65 60 78 0 0 Q2 2013 Q2 2014 Q2 2013 Q2 2014 Run-off, net DKKm Run-off net, effect on combined ratio 30
Slide 15: Expense ratio development
Expense ratio development • Expense improved from 15.6 in Q2 2013 to 12.6 in Q2 2014. Expense ratio Q2: One-off effects of 2.8%-point • Excluding one-off effects, expense ratio was 15.4 - an improvement of 0.2 pp. 16.7 16.6 16.6 16.4 15.6 15.6 • Nominal expenses on Group level reduced significantly
Slide 16: Investment, capital and financial targets
Investment, capital and financial targets
Slide 17: Investment result Q2 2014
Investment result Q2 2014 Investment return Free portfolio – Q2 2014 (DKK 12.7bn) DKKm 3 Equities (22) Free investment 244 37 Investment property (15) Match regulatory deviation 49 Bank deposits/bonds (15) Percentage 24 Match performance 50 Govt. Bonds (3) High yield (6) Other financials -84 C ov. B
Slide 18: Capital structure and status on share buy back
Capital structure and status on share buy back Capital – Q2 2014 DKKm • Capital buffer based on Individual 12,000 Solvency increased to 63% (2013 Q4: 50%) and was impacted by: Excess capital • H1 result 2014 8,000 4,218 Buffer • H1 share buy back deducted in buffer. Capital requirement 4,000 6,734 •
Slide 19: Financial targets
Financial targets ROE after tax of 20% to be achieved by delivering a full year combined ratio of 90 or lower. Expense ratio <15 in 2015 ROE after tax 40% 30% ROE target 20% 10% 0% 14 05 06 07 08 09 10 11 12 13 14 15 20 20 20 20 20 20 20 20 20 20 20 20 1 H 19
Slide 20: Q/A
Q/A Follow us on Twitter: @TrygIR
Slide 21: Upcoming roadshows
Upcoming roadshows Date Place Participants from Tryg Arranged by Morten Hübbe, CEO Tor Magne Lønnum, CFO 10/07/2014 Copenhagen Danske Markets Lars Bonde, Group EVP and COO Investor Relations Morten Hübbe, CEO 11/07/2014 London Tor Magne Lønnum, CFO ABG Investor Relations 19-22/08/2014 Canada/ USA La