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Scor — Goldman Sachs European Financials Conference 2008
34 slides from Scor's conference presentation, Jun 11, 2008
Slide 1: SCOR - A new company based on proven strategies and great ambitions
SCOR - A new company based on proven strategies and great ambitions Paolo De Martin, Group CFO Benjamin Gentsch, Deputy CEO SCOR Global P&C Goldman Sachs European Financials Conference 2008 Berlin, 11 June 2008
Slide 2: Notice
Notice Certain statements contained in this presentation are forward-looking statements, of necessity provisional, that are based on risks and uncertainties that could cause actual results, performance or events to differ materially from those in such statements. Additional information regarding ris
Slide 3: A twin-engine group based on proven strategies
1 A twin-engine group based on proven strategies Life engine – An attractive market delivering consistency and 2 stability to the Group 3 Non-Life engine – Focus on profitability and diversification 4 Well on track to achieve 2010 targets
Slide 4: A new company based on proven strategies and great ambitions
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets A new company based on proven strategies and great ambitions Back on Track Introduction mid 2007 – mid 2010 Restoring confidence Dynamic Lift 1. Detailed balance sheet review 2. 2002 – a
Slide 5: SCOR enters a new global dimension with record earnings
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets SCOR enters a new global dimension with record earnings... A powerful twin-engine Group “A” level financial 5th largest reinsurer strength ratings in the world 1st listed French company t
Slide 6: …with a robust capital shield and a focus on shareholder value creation
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets …with a robust capital shield and a focus on shareholder value creation Capital shield Shareholder value Solid balance sheet (published) Strong earnings (pro-forma) in €m 2007 2007 Invest
Slide 7: Twin-Engine strategy is driving SCOR's highly diversified portfolio
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets “Twin-Engine” strategy is driving SCOR’s highly diversified portfolio Well balanced Non-life and Life portfolios… A high diversification level thanks to: ‘Twin-engine’ strategy relyin
Slide 8: A twin-engine group based on proven strategies
1 A twin-engine group based on proven strategies Life engine – An attractive market delivering consistency and 2 stability to the Group 3 Non-Life engine – Focus on profitability and diversification 4 Well on track to achieve 2010 targets
Slide 9: SCOR Global Life offers top-class expertise in a market with high barriers of entry
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets SCOR Global Life offers top-class expertise and service in a market with high barriers of entry Attractive Life reinsurance market with high barriers of entry Committed long-term partne
Slide 10: SCOR's Life engine delivers consistency and stability
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets SCOR’s Life engine delivers consistency and stability Key Data (2007, pro-forma) in €m Gross premiums written Operating result Is a leading Life reinsurer in key of which: markets, espe
Slide 11: SCOR Global Life EEV reaches €1.64 billion
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets SCOR Global Life EEV reaches € 1.64 billion driven by € 188 million operating profit after tax, in €m EEV earnings of € 203 million € 9 per share 1 716 +22 +2 -53 +188 -9 1 663 -114 1 638
Slide 12: Significant growth in value not recognized under IFRS
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets Significant growth of € 68 million in value not recognized under IFRS Value not recognized under IFRS EEV is more suitable to capture the in €m economic value of Life business than IFRS
Slide 13: Mature business book expected to provide substantial distributable cash flow
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets Mature business book expected to provide substantial distributable cash flow over the next years Trendline1) of expected annual distributable2) cash flow in €m, net of maintenance expense
Slide 14: A twin-engine group based on proven strategies
1 A twin-engine group based on proven strategies Life engine – An attractive market which delivers consistency 2 and stability to the Group 3 Non-Life engine – Focus on profitability and diversification 4 Well on track to achieve 2010 targets
Slide 15: SCOR Global P&C is committed to reinsurance and a worldwide presence
SCOR Global P&C is committed to reinsurance and a worldwide presence… Worldwide Presence Global reach and broad band of capabilities to serve our clients in the best possible way…but voluntarily underweighted in the US Primary focus on reinsurance Niche insurance business very selectively purs
Slide 16: Excellent business position in Business Solutions and Specialty Lines
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets …with an excellent business position in Business Solutions and Specialty Lines… Portfolio Mix by Line of Business 2008 expected Natural Resources 12% Industrial & 12% SCOR shows excelle
Slide 17: Strong operating performance for Q1 2008
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets … resulting in strong operating performance for Q1 2008 Profit & Loss Gross written premium development in €m, pro-forma in €m, pro-forma -7% Q1 2007 Q1 2008 Variation -2% 1) Gross writte
Slide 18: A twin-engine group based on proven strategies
1 A twin-engine group based on proven strategies Life engine – An attractive market which delivers consistency 2 and stability to the Group 3 Non-Life engine – Focus on profitability and diversification 4 Well on track to achieve 2010 targets
Slide 19: Integration process well on track
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets Integration process well on track Work in Completed progress Due in Mobilize key talents and announce new management teams 9 Organization Harmonize and merge incentive schemes 9 Harmonize
Slide 20: Streamlining of operations underway
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets Streamlining of operations underway Pre-tax annual synergy targets of EUR 68m Synergies split per function confirmed (of which EUR 35m in 2008) (estimation as of March 2008, all inclusive
Slide 21: Delivering value to shareholders while providing optimal security to clients
A new company based on proven strategies | Life engine | Non-Life engine | Well on track to achieve 2010 targets Delivering value to shareholders while providing optimal security to clients In a challenging environment, SCOR aims over the next 3 years: To secure a ROE of 900 bps above risk free rate
Slide 22: Appendices
APPENDICES Appendix A: Active positioning in a changing Life environment Appendix B: SCOR Global P&C anticipates the challenges ahead Appendix C: Successful combination of SCOR and Converium P&C portfolios Appendix D: Strong Life European Embedded Value development in 2007 Appendix E: Life Q1 result
Slide 23: Appendix A: Active positioning in a changing Life environment
Appendix A: Active positioning in a changing Life environment Adapting to a changing risk & new Facing more global client needs and regulatory environment (ageing of the increased retention population, new regulatory constraints, emergence of new distribution channels) Advanced research centers in
Slide 24: Appendix B: SCOR Global P&C anticipates the challenges ahead
Appendix B: SCOR Global P&C anticipates the challenges ahead Adapting to a changing risk & new Facing more global client needs and regulatory environment (ageing of the increased retention population, new regulatory constraints, emergence of new distribution channels) Consolidating and cross-selli
Slide 25: Appendix C: Successful combination of SCOR and Converium P&C portfolios
Appendix C: Successful combination of SCOR and Converium P&C portfolios Strong renewals with limited business attrition K e y hig h ligh ts | G lo ba l P & C Jan u ary 2008 ren ew al p erfo rm an ce by seg m en ts | O u tloo k O u tsta nd ing Janua ry 200 8 rene w a ls Reinforced relationships wit
Slide 26: Appendix D: Strong Life European Embedded Value development in 2007
Appendix D: Strong Life European Embedded Value development in 2007 2007 SCOR Global Life European Embedded Value (EEV) reaches € 1.64 billion including Converium, capital outflow and considering negative foreign exchange impact Strong development results in a Life EEV of € 1.72 billion and a re
Slide 27: Appendix D: Very satisfactory value of new business of €60 million
Appendix D: Very satisfactory value of new business of € 60 million EEV operating profit in €m Strong increase in new business value 2007 2006 Variation from € 51.3 million to € 59.7 million, from various European markets, mainly in Life Value added by new business 59.7 51.3 +16.4% and Health Prot
Slide 28: Appendix D: Positive cash production allows for capital repatriation
Appendix D: Positive cash production allows for capital repatriation EEV 2007 vs. EEV 2006 in €m The positive cash production in 2007 2007 2006 allowed a cash repatriation of capital to the Group (SCOR SE) of € 114.4 Required Capital 609.5 483.5 million Free Surplus 123.8 192.8 This explains the
Slide 29: Appendix E: Life Q1 2008 results
Appendix E: Life Q1 2008 results Profit & Loss Gross written premiums in €m, pro-forma in €m, pro-forma -2.7% Q1 2007 Q1 2008 Variation 634 +1.4% 6171) (at constant Gross written premiums 634 617 - 3% exch. rates) Net earned premiums 566 560 - 1% Subtitle 33 Subtitlemanagement 31/03/07 31/03/08 Tech
Slide 30: Appendix F: Asset Management - Cautious investment approach reinforced
Appendix F: Asset Management - Cautious investment approach reinforced Total investments € 18.5 billion in €m, published Q1 2008 Q1 2007 Real Average investments over the period 18 758 14 041 Equities Estate Alternative 5% Total net investment results (net of Cash 2% Investments3) 139 157 2% expense
Slide 31: Appendix G: Unrealized gains & losses evolution
Appendix G: Unrealized gains & losses evolution YTD unrealized gains & losses in €m 2006Q4 2007Q1 2007Q2 2007Q3 2007Q4 2008Q1 98 105 27 57 84 6 122 122 119 154 156 122 Real estate & REITS 28 29 23 -14 Bonds -52 -46 -34 -51 -36 Equities -115 -115 -35 31
Slide 32: Appendix G: Investment income QTD
Appendix G: Investment income QTD Investment Income QTD (before investment expenses) Groupama guarantee -10 impact1) in €m Equities impairments -17 250 211 Real estate amortization -5 195 14 Change in depreciation of -32 8 20 152 investment 168 Realized gains on bonds 23 33 158 5 Realized losses on
Slide 33: Appendix G: Update on structured products
Appendix G: Update on structured products Structured product portfolio € 1.2 billion of high quality; 91% AAA-rated 100% Alt-A MBS Commercial MBS 2% 16% 75% Subprime MBS 4% Consumer 50% ABS1) Prime non- 10% agency MBS 13% CDO 6% Total Principal protected MBS ABS CDO & PPS2) MBS: strategies 6% AAA AA
Slide 34: Appendix G: Key characteristics and performance indicators of subprime and Alt-A products
Appendix G: Key characteristics and performance indicators of subprime and Alt-A products Alt-A MBS (Total: US$ 31 m) Subprime MBS Prime 2nds (Total: US$ 14 m) Subprime (Total: US$ 55 m) Original average credit support 6.79% Prime 2nd Liens make up 21% 15% of subprime exposure of total subprim
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