Aviva Plc · LSE:AV.
Aviva — H1 2015 Earnings Presentation
30 slides from Aviva's earnings presentation, 2015
Slide 1: Aviva 2015 Interim Results
AVIVA 2015 Interim Results
Slide 2: Disclaimer
Disclaimer Cautionary statements: This should be read in conjunction with the documents filed by Aviva plc (the “Company” or “Aviva”) with the United States Securities and Exchange Commission (“SEC”). This presentation contains, and we may make other verbal or written “forward-looking statements” wi
Slide 3: Who we are: putting the customer first
growth, by always putting the customer first ey True Customer Composite Meeting all our customer needs across life, general, health insurance and asset management == Across our 16 businesses, we protect our 34 million customers and the things that are important to them: Who we are We have a clear st
Slide 4: Strategy delivery timeline since 2013
Sale of Strategic anchor Cash flow Digital garage Aviva USA Indonesia JV Aviva Turkey up 65% launched launched launched IPO Cell analysis AIMS Interim New CEO Budget £571m Strategic review launched dividend appointed impacting Cost of AI up 15% annuities savings achieved JAN 2013 MAY 2013 OCT 2013 M
Slide 5: 2015 Interim Results — key areas
2015 Interim Results — 3 key areas AVIVA rs Operating profit up 9% a VNB growth up 25%! BA Combined operating ratio of > 93.1%, improvement of 2.4ppts om Economic Capital surplus £10.8bn2 £ 15% increase in interim dividend 1. Constant currency basis. a Ahead of schedule ro Run-rate savings £63m £ £2
Slide 6: Results - Growth initiatives delivering
Results - Growth initiatives delivering AVIVA Life: Value of new business GI: Underwriting profit Asset Managem £534m £444m 2s: HY14 HY15 Group VNB up 25%! UK Life VNB up 31% ex FL Results show benefits of product diversification £223m HY14 HY15 Underwriting profit up 45% New bancassurance distribut
Slide 7: Friends Life Integration – ahead of schedule
Friends Life Integration – ahead of schedule • • • • • • • • • 7
Slide 8: Solvency II update
Solvency Il update Lal AVIVA Current status . Internal model application June 2015 PRA approval expected December 2015 Yardstick for dividends after the benefit of transitionals Risk margin / transitionals broadly offsetting Expect additional capital synergies from Friends Life acquisition to be rea
Slide 9: Digital experience / True Customer Composite
Digital experience / True Customer Composite Lal AVIVA Improved customer proposition sim | nue | saves | ae | cme: | mmm | tensa » Composite product offering creates competitive Hello Sarah advantage LZ. sarah whitmore@amail com * Separate UK digital entity based in our digital garage Your policies
Slide 10: Interim 2015 Results – Tom Stoddard, CFO
AVIVA Interim 2015 Results Tom Stoddard Chief Financial Officer
Slide 11: Operating profit
Operating profit 1 Operating profit £ million HY14! HY15 Change IFRS Operating profit reconciliation fm Life 973 1,021 5% Operating profit HY14" 1,071 General Insurance & Health 403 422 5% Aviva Underlying operating profit growth (excl. FL) 86 Fund Management 48 33 (31)% Foreign exchange (54) Other
Slide 12: Net asset value
Net asset value al AVIVA Net asset value per share IFRS MCEV Opening NAV per share at 31 December 2014 340p 527p Operating profit 19p 20p Friends Life acquisition 55p 5p Dividends (9)p (9)p Investment variances & AFS equity movements ip (3)p Pension fund (7)p (7)p Foreign exchange (10)p (16)p Integr
Slide 13: UK Life
UK Life AVIVA Value of new business £ million HY14 HY15 A Protection 45 66 47% Annuities 81 90 11% Pensions & platforms 30 59 97% Equity release & other 21 38 81% Total 177 253 43% * Improved business mix with greater contribution from protection, pensions and platforms. * Excluding Friends UK, VNB
Slide 14: UK GI
UK GI A Operating profit Operating profit Net written premium £m HY14 HY15 £1,851m £1,836m Underwriting result 114 115 £251m £223m Investment income on portfolio 55 56 Inv Income internal loan 82 52 £137m Total 251 223 Combined operating ratio £114m £115m HY14 HY15 HY14 HY15 Hy14 HY15 Personal Motor
Slide 15: Canada
Canada AVIVA Combined operating ratio Operating profit Net written premium HY14 HY15 £1,026m £1,013m Personal Motor 95% 89% £131m Home 101% 102% £83m Commercial 97% 89% Total 97% 92% HY14 HY15 HY14 HY15 * Underwriting profit improved to £82m (HY14: MMLLTIR. Ill Underwriting Result £30m) mostly due t
Slide 16: Europe
• • • HY14 included a £16m one-off dividend in Spain 16
Slide 17: Asia
Asia AVIVA Value of new business Value of new business!’ Operating profit £ million HY14 HY15 nN 7% 8% Protection 36 49 31% £75m Unit Linked - 4 - 16% HY15 Health 10 12 11% 64% £35m Participating 5 6 8% 5% Other 10 5 (49)% Total 61 76 18% mProtection Unit Linked = Retail Health HY14 HY15 Participati
Slide 18: Operating expenses
Operating expenses AVIVA GBP £m Integration & restructuring costs £m HY14 HY15 Solvency I 39 46 Aviva UK Life 263 QDpa 239 Friends Life related costs : n/a : 109 Friends UK Life - C n/a eS Other i 3 7 Total : 42 : 172 Ireland Life 15 C 0% ) 15 2 : UK & Ireland Life 278 369 * UK Life expenses reflect
Slide 19: Improved financial flexibility
Improved financial flexibility Bl AVIVA Economic capital surplus’ Holding company liquidity? fbn fbn 2 "1 10.8 1.6 9 8.3 8.0 12 1 7 3.6 0.2 3} a : 1 : 0 a 2011 2012 2013 2014 HY 2015 Jan-13 HY 2014 HY 2015 Intercompany loan S&P leverage ratio fbn 6.0 5.8 35% 31% 3.6 Plan 30% 4.0 28 27 28% 27%3 0.0 -
Slide 20: More surplus, better aligned to Solvency II
More surplus, better aligned to Solvency Il AVIVA Economic capital surplus* fbn 178% 03 08 176% as EE es ee 0.9 0.8 3.4 FY14 Friends Life FL group Model Underlying FX and HY 2015 diversification strengthening movement & economic other variances + Enlarged capital base following Friends Life acquisit
Slide 21: Economic Capital sensitivities
Economic Capital sensitivities 176% 21
Slide 22: Improved financial flexibility
Improved financial flexibility Bl AVIVA Economic capital surplus’ Holding company liquidity? fbn fbn 2 "1 10.8 1.6 9 8.3 8.0 12 1 7 3.6 0.2 3} a : 1 : 0 a 2011 2012 2013 2014 HY 2015 Jan-13 HY 2014 HY 2015 Intercompany loan S&P leverage ratio fbn 6.0 5.8 35% 31% 3.6 Plan 30% 4.0 28 27 28% 27%3 0.0 -
Slide 23: Interim 2015 Results – Mark Wilson, Group CEO
AVIVA Interim 2015 Results Mark Wilson Group Chief Executive Officer
Slide 24: Q&A
AVIVA Interim 2015 Results Q&A
Slide 25: Appendix
AVIVA Appendix
Slide 26: Adjustments to Friends Life Operating Profit
Adjustments to Friends Life Operating Profit • 26
Slide 27: FY 2014 Group Profit Drivers — Life Only
FY 2014 Group Profit Drivers — Life Only AVIVA 1 Aviva’ Friends Life Total New Business Income 815 208 1,023 Underwriting margin 463 99 562 Investment return 1,901 827 2,728 Total income 3,179 1,134 4,313 Acquisition expenses (637) (279) (916) Admin expenses (867) (485) (1,352) Total expenses (1,504
Slide 28: Appendix FY 2014 Group Life profit driver analysis
Appendix FY 2014 Group Life profit driver analysis AVIVA Key: IFRS Profit Driver Pre-tax Aviva FL Total operating profit 2,019 661 2,680 j [ \ DAC nfl Income amortisation and other Expenses and commissions 3,179 1,134 4,313 344 291 635 (1,504) (764) (2,268) \ \ [ \ 1 New business income Investment r
Slide 29: Appendix FY 2014 Group Life profit driver analysis
Appendix FY 2014 Group Life profit driver analysis AVIVA Key: IFRS Profit Driver Investment return Aviva FL Total 1,901 827 2,728 Pan . Afr P . Expected return on Unit linked margin Participating business Spread margin shareholder assets 886 594 1,480 624 66 690 187 121 308 204 46 250 See final slid
Slide 30: Appendix: basis of preparation
Appendix FY 2014 Group Life profit driver analysis Bl AVIVA Basis of preparation: Aviva's acquisition of Friends Life completed on 10 April 2015 and the results of Friends Life are included in Aviva's reported numbers from that date. This appendix illustrates the estimated effect of aligning Friends