Slide 1: Financial results First half 2017
Financial results First half 2017 Analyst and Investor presentation July 26th, 2017
Slide 2: Key Highlights
01 Key Highlights > 6M 2017 01 KEY HIGHLIGHTS 0 2 F I N A N C I A L OV E RV I E W 2
Slide 3: Key Figures 6M 2017
01 Key Highlights > 6M 2017 Key Figures > 6M 2017 6M 2017 Δ% Revenue 15,438.3 5.4% Total written and accepted premiums 13,073.1 8.2% - Non-Life 10,256.1 7.8% - Life 2,817.1 9.7% Non-Life Combined Ratio 97.2% -0.4 p.p Non-Life Loss Ratio 69.7% -0.2 p.p Non-Life Expense Ratio 27.4% -0.2 p.p Net result
Slide 4: Solid revenue growth, proof of a successful profitable growth strategy
01 Key Highlights > 6M 2017 Solid revenue growth, proof of a successful profitable growth strategy . . . Revenue +5.4% Resilient growth in revenue despite the fall in financial income as a consequence of falling yields in Brazil and lower realized gains on Unit Linked investments 14,641 15,438 A
Slide 5: Improvements in technical margins
01 Key Highlights > 6M 2017 . . . which is leading to improvements in technical margins Combined ratio -0.4 p.p 97.5% 97.2% Excellent expense ratio with noteworthy improvements in 27.6% 27.4% Spain, Mexico and Italy, as a result of strict cost containment policies as well as the adaptation of the
Slide 6: High diversification mitigating currency and market volatility impact
01 Key Highlights > 6M 2017 MAPFRE’s high level of diversification has helped to mitigate the impact of currency movements and market volatility on the balance sheet Shareholders’ equity -2.9% Fall in shareholders’ equity due to the depreciation of several main currencies, mainly the Brazilian rea
Slide 7: Key Highlights 2Q 2017
01 Key Highlights > 6M 2017 Key Highlights > 2Q 2017 Issuance of two-year PEMEX policy in Mexico (€499 mn) Decline in premiums in 2Q in IBERIA, stemming from seasonality effects in Health and the concentration of Life- 2Q 2016 1Q 2017 2Q 2017 saving campaigns in the first quarter of the year Rev
Slide 8: Insurance: Solid trends in main markets
01 Key Highlights > 6M 2017 Solid trends in main markets with tailwinds from currency movements Premiums – Distribution by business unit Premiums – Evolution GLOBAL RISKS %Δ 5.0% ASISTENCIA IBERIA 3,947 4.4% 3.7% LATAM 4,473 22.4% IBERIA BRAZIL 2,383 13.9% INSURANCE RE 27.4% 16.2% LATAM NORTH 1,195
Slide 9: Insurance: Results underpinned by solid technical results
01 Key Highlights > 6M 2017 Results underpinned by solid technical results in core markets and turnaround of several businesses undergoing restructuring processes Attributable result – Evolution by business unit % over total* Δ (%) Δ (€mn) 52.9% IBERIA 260.7 16.5% +36.9 23.3% LATAM 114.8 3.6% +4.1 1
Slide 10: Financial Overview
01 Key Highlights > 6M 2017 01 KEY HIGHLIGHTS 0 2 F I N A N C I A L OV E RV I E W 10
Slide 11: Strong underlying result
02 Financial Overview Strong underlying result Main drivers of variation of net result – 6M 2017 vs. 6M 2016 Non- Life Life 380.4 415.1 85.5 5.5 30.9 29.0 26.0 25.5 -8.3 -7.8 -20.6 -57.6 -73.4 Net result - Δ Underlying Coastal Niño Δ Non-technical Δ Underlying Δ Financial gains, Δ Underlying result
Slide 12: Insurance: Steady premium growth in main markets
02 Financial Overview Steady premium growth in main markets, in line with profitable growth strategy Non-Life premiums %Δ IBERIA: Notable growth in Retail Motor IBERIA 2,762 2.5% (+3.3%) and Health (+4.7%) LATAM 3,412 26.0% BRAZIL: Solid local currency growth in Industrial Risks (+16.9%) and Agr
Slide 13: Cost containment and improvements in technical management
02 Financial Overview Cost containment and improvements in technical management continue driving underwriting results Combined Ratio Positive claims trends in several main markets helped offset other negative developments: %Δ Spain (Motor): Lower frequency and positive evolution of 1.1 p.p VERTI
Slide 14: Decline in net financial income on lower interest rates in Brazil
02 Financial Overview Decline in net financial income on the back of lower interest rates in Brazil and negative evolution of the US dollar Net financial income – Non-Life Negative foreign exchange differences in 6M 2017 455.3 (-€23.7 mn), compared to +€22.6 at 6M 2016, 373.6 driven by the evoluti
Slide 15: Strong contribution of Life business
02 Financial Overview Strong contribution of Life business thanks to distribution capacity and improving results IBERIA: Premiums – Life Successful launch of new savings products and sales campaigns, especially unit-linked, with solid IBERIA 1,087 9.1% performance in bancassurance 1,186 Premiu
Slide 16: Depreciation of main currencies during the quarter
02 Financial Overview Depreciation of main currencies during the quarter Change in shareholders’ equity Key highlights Shareholders’ equity – 2016 year end 9,127 Negative impact from the depreciation of several main Δ Financial Assets Available for Sale & others -244 currencies, mainly the Brazili
Slide 17: Asset allocation reflects market movements
02 Financial Overview Asset allocation reflects market movements, as well as a reduction of fixed income and increase in equity Investment portfolio – Breakdown by asset class Cash 1,519 (3.1%) Other investments(2) Mutual funds 4,737 (9.6%) 2,102 (4.3%) Equities 1,971 (4.0%) Real Estate(3) 2,201 (4.
Slide 18: Diversified and high quality capital structure
02 Financial Overview Diversified and high quality capital structure Capital structure Interest coverage (x) (1) Subordinated 29.2 Bank 26.1 debt financing 9% 21.0 3% Senior debt 7% € 13,507 Equity 81% million 30.6.2016 31.12.2016 30.6.2017 Leverage (2) 19.6% 17.1% 16.1% On June 19th 2017, MAPFRE
Slide 19: Stable solvency position
02 Financial Overview Stable solvency position Accumulated Individual Solvency II ratio ratio impact Ratio at 31.03.2017 211.5% 200% 210% 211% Without transitionals for technical 194.4% - 17.1 pts 9,616 9,689 provisions 8,635 Without equity transitionals 191.9% - 2.5 pts 4,311 4,582 4,582 Without tr
Slide 20: Increase in Eligible Own Funds
02 Financial Overview Increase in Eligible Own Funds IFRS Equity and Eligible Own Funds reconciliation – March 2017 Key highlights Δ vs. December 2016 IFRS equity 11,221 -223 Participations not included under SII -211 +1 Increase in Eligible Own Funds during the Subsidiaries under equivalence & ot
Slide 21: Well balanced risks that optimize diversification benefits
02 Financial Overview Well balanced risks that optimize diversification benefits Solvency Capital Requirement per risk category Market 2,488 Counterparty 780 Underwriting 3,114 Diversification benefits -2,046 BSCR 4,335 Further adjustments * 247 Total SCR 4,582 *Further adjustments include: operatio
Slide 22: Solvency II: Next steps
02 Financial Overview Solvency II: Next steps Streamline Continue working to speed up and streamline Solvency II processes calculation process Analyze feasibility of treatment of Puerto Rico under third party Scope equivalence Consideration of ABDA Adapt existing internal models for longevit
Slide 23: Market Consistent Embedded Value: Key Figures 2016
02 Financial Overview Market Consistent Embedded Value: Key Figures 2016 2016 r% (1) Value of In-force Business (VIF) 2,552.1 65.0% (1) Market Consistent Embedded Value (MCEV) 4,548.5 44.0% Attributable to the Parent Company 3,664.5 53.7% Attributable to Minority Interests 884.0 14.1% Return on Embe
Slide 24: Terminology
03 Backup Terminology Combined ratio – Non-Life Expense ratio + Loss ratio (Operating expenses, net of reinsurance – other technical revenue + other technical expenses) / Net Expense ratio – Non-Life premiums earned. Figures for the Non-life segment (Net claims incurred + variation in other technica
Slide 25: Disclaimer
Disclaimer This document is purely informative. Its content does not constitute, nor can it be interpreted as, an offer or an invitation to sell, exchange or buy, and it is not binding on the issuer in any way. The information about the plans of the Company, its evolution, its results and its divide