Sava Re,d.d · LJSE:POSR
Sava Re,d.d — Sava Re — H1 2021 Earnings Presentation
38 slides from Sava Re,d.d's earnings presentation, Aug 19, 2021
Slide 1: Sava Insurance Group 1–6/2021 unaudited results
Sava Insurance Group 1–6/2021 unaudited results 19 August 2021
Slide 2: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 3: Highlights 1–6/2021
Highlights 1–6/2021 Growth in operating revenue of 14.7% Net profit of €43.5 million, which represents 82.3% of planned net profit for 2021 Net expense ratio of 27.7% (last year 30.0%) Net combined ratio (excluding FX differences) of 85.3% (last year 91.7%) Improved performance of all segments as a
Slide 4: Key figures
Key figures Change € million, except % 1–6/2020 1–6/2021 2021 plan 2021/2020 Group Operating revenue 317.1 363.7 > 685 14.7% Gross premiums written, (re)insurance part 372.3 412.4 > 685 10.8% Net expense ratio, including operating revenue* 30.0% 27.7% 32 ̶ 33% -2.3 p.p. Return on the investment port
Slide 5: Breakdown of consolidated revenue
Breakdown of consolidated revenue Growth/decline compared to the previous year Without Vita Without FOS and Vita • Earned premiums • Premiums from annuities • Income from resolving TBS • Other technical income (including commision) • Income from managing Team assistance cases • Other income pension
Slide 6: Growth in consolidated GPW of 10.9%
Growth in consolidated GPW of 10.9% Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 6 strategic goals in key focus areas • 2021 plan
Slide 7: Breakdown of consolidated GPW
Growth/decline Breakdown of consolidated GPW Without Vita Without FOS and Vita compared to the previous year Consolidated gross premiums written by class of insurance Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 7 str
Slide 8: Growth in profit before tax of 42.8%
Growth in profit before tax of 42.8% Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 8 strategic goals in key focus areas • 2021 plan
Slide 9: Consolidated profit before tax by segment
Consolidated profit before tax by segment Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 9 strategic goals in key focus areas • 2021 plan
Slide 10: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 11: Results by operating segment – reinsurance
Results by operating segment – reinsurance • GPW grew by 6%, non-proportional reinsurance • Improvement in underwriting result mainly • Somewhat lower investment result, excluding FX by 9% and proportional by 5% due to higher premium income and positive differences, mainly due to lower interest inco
Slide 12: Results by operating segment – non-life Slovenia
Results by operating segment – non-life Slovenia • Decline in FoS business (down €16.1 million) • Stronger technical result of Slovenian part • Better investment result as a consequence of lower • GPW of non-FoS business (growth of €6.5 million, because of lower claims frequency due to the investmen
Slide 13: Results by operating segment – non-life international
Results by operating segment – non-life international • Growth in GPW, except Croatia, (of 10%), mainly in • Stronger technical result mainly due better result • Lower investment result due to lower interest health insurance in Kosovo and Serbia due to an of Croatian branch office (in 2020: negative
Slide 14: Results by operating segment – life Slovenia
Results by operating segment – life Slovenia • Vita part of Group since 31 May 2020; • Net expense ratio down due to the inclusion of • Higher return influenced by the inclusion of Vita GPW contribution in 1–6/2020 €7.3 million, Vita, which operates at a lower expense ratio (2.1% return in 1–6/2021
Slide 15: Results by operating segment – life international
Results by operating segment – life international • Strong decline in GPW in Croatian part of • Lower cost ratio mainly due to increased premium • Investment result is lower due to lower net Zavarovalnica Sava due to lower sales through bank income from Serbian and Kosovo life insurance income from
Slide 16: Results by operating segment – pensions and asset management
Results by operating segment – pensions and asset management • The annuity insurance portfolio has grown in line • Increase in revenues due to increased assets • Increase in operating costs due to growth in with the number of policyholders eligible for under management, most notably at Sava business
Slide 17: Results by operating segment – other
Results by operating segment – other Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 17 strategic goals in key focus areas • 2021 plan
Slide 18: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 19: Investment portfolio and AuM
Investment portfolio and AuM Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 19 strategic goals in key focus areas • 2021 plan
Slide 20: Structure of the investment portfolio
Structure of the investment portfolio 31/12/2020 30/6/2021 Investment portfolio (€ million) 1,535.3 1,566.2 Government bonds 43.0% 43.5% Corporate bonds 40.3% 38.5% Cash and cash equivalents 4.8% 5.7% Investment property 2.5% 2.7% Mutual funds 2.5% 2.4% Infrastructure funds 1.8% 2.2% Shares 1.5% 1.3
Slide 21: Net inv. income of and return on the investment portfolio
Net inv. income of and return on the investment portfolio € million, except % 1–6/2020 1–6/2021 Absolute change Net investment income relating to the investment portfolio 6.3 13.7 7.4 Net inv. income of the investment portfolio, excl. FX diff. 8.1 11.6 3.5 Return on the inv. portfolio, excl. FX diff
Slide 22: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 23: Shareholders and share trading
Shareholders and share trading 30/6/2021 Book value per share Share capital (€ million) 71.9 Market capitalisation (€ million) 425.3 €31.19 Trading symbol Number of shares POSR 17,219,662 30 Jun 21 / 31 Dec 20: +5.0% Number of own shares 1,721,966 Number of shareholders 4,229 * Custody account. Grou
Slide 24: Dividend policy
Dividend policy • Dividend policy: 10% average increase in dividend per year; distribution of between 35% and 45% of the net profit of the Sava Insurance Group. • Sava Re did not pay any dividends in 2020 because of increased Covid-19-related risks identified and due to special caution in response t
Slide 25: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 26: Capital adequacy
Capital adequacy € million 31/12/2020 Eligible own funds 567.8 Solvency capital requirement 287.4 Solvency ratio 198% € million 31/3/2021 (unaudited) Eligible own funds 599.2 Solvency capital requirement 287.4 Solvency ratio 208% The Sava Insurance Group’s Solvency and financial condition report 202
Slide 27: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 28: Digital transformation, technology upgrades & customer at the centre
Digital transformation, technology upgrades & customer at the centre • As part of its 2020–2022 strategy, the Group has embarked on large-scale projects aimed towards digital transformation and customer-centricity. • The Group is also undergoing significant technological upgrades to support the digi
Slide 29: Contents
Contents • Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of strategic goals in key focus areas • 2021 plan
Slide 30: Key group performance metrics
Key group performance metrics 2019 2020 2021 € actual actual plan Group Operating revenue €588.5 m €680.8 m > €685 m Estimate: Profit or loss, net of tax €50.2 m €56.4 m > €53 m > €60 m Return on equity 13.8% 13.3% >= 11.5% Net expense ratio* 31.6% 29.5% 32‒33% Investment return* 1.9% 1.6% 1.5% (Re)
Slide 31: Consolidated GPW / operating revenue by segment
Consolidated GPW / operating revenue by segment Group results • Segment reporting • Financial investments • POSR share and dividend policy • Solvency position • Achievement of 31 strategic goals in key focus areas • 2021 plan
Slide 32: Thank you for your attention.
Thank you for your attention.
Slide 33: Disclaimer
Disclaimer Forward-looking statements This document may contain forward-looking statements relating to Sava Reʾs expectations, plans or goals, which are based on assumptions made by Sava Re management. By their nature, forward-looking statements involve risk and uncertainty. As a result, actual deve
Slide 34: Appendix
Appendix
Slide 35: Group exposure by region
Group exposure by region Exposure to individual regions did not change significantly in the period under review compared to the end of 2020. Države EU 35 Appendix
Slide 36: Group exposure to Slovenia
Group exposure to Slovenia € million 31/12/2020 30/6/2021 Change Type of investment Amount Structure Amount Structure in p.p. Government bonds 148.5 9.2% 133.9 8.2% -1.0 Cash and cash equivalents 69.2 4.3% 81.7 5.0% 0.7 Shares 18.4 1.1% 19.7 1.2% 0.1 Corporate bonds 20.5 1.3% 19.3 1.2% -0.1 Investme
Slide 37: Group exposure by industry
Group exposure by industry The decrease in exposure to the banking industry is due to the maturity of deposits and covered bonds. Industry Banking * Includes direct investments in real estate and property funds. Also included are corporate bonds classified as real estate under GICS. 37 Appendix
Slide 38: Solid rating profile maintained despite Covid-19
Solid rating profile maintained despite Covid-19 The share of the investment class represents 85.9% of fixed income investments and is 3.0 percentage points higher than at the end of the previous year. The decline in A-grades is due to the maturity of government bonds and the downgrading of credit r