Vienna Insurance Group Ag · VIE:VIG
Vienna Insurance — FY2016 Earnings Presentation
57 slides from Vienna Insurance's earnings presentation, Mar 23, 2017
Slide 1: 12M 2016 Preliminary Results Presentation
Vienna Insurance Group 12M 2016 Preliminary Results Presentation Vienna, 23 March 2017 Highlights / Agenda 2020 Financials Outlook Main regions Appendix
Slide 2: 12M 2016 Results conference call: presenting team and topics
12M 2016 Results conference call Presenting team and topics Presenting team: Elisabeth Stadler, CEO Martin Simhandl, CFO Roland Gröll, Member of the Managing Board Judit Havasi, Member of the Managing Board Peter Höfinger, Member of the Managing Board Topics: Highlights & Agenda 2020 p. 3 Appendix 1
Slide 3: Key facts 2016
Key facts 2016 2016 targets clearly achieved EUR 9,051mn EUR 406.7mn Gross written premium Profit before taxes 97.3% EUR 0.80 Combined Ratio Dividend per share1 >50% EUR 2.16 CEE premium and profit share Earnings per share Development of the strategic work programme “Agenda 2020” 1: subject to appro
Slide 4: VIG reached its targets for 2016
VIG reached its targets for 2016 Solid preliminary results Profit before taxes Market share Target: “At least double the profit before Target: taxes 2015 up to €400mn” “Market share of at least 10% over the mid-term 2016 EUR 407mn in selected markets” Health insurance Target: “Strengthening health i
Slide 5: Agenda 2020: Key strategic areas
Agenda 2020: Key strategic areas Directions of impact Optimisation of business model Safeguard future viability • Shared Services • Use of growth potentials Creating cost benefits by merging back-office Intensify selected business areas e.g. health functions and companies insurance, reinsurance, c
Slide 6: Economic growth in CEE clearly above the level of the Eurozone
Economic growth in CEE clearly above the level of the Eurozone Expected annual real GDP growth Real GDP growth p.a. 2016-2019 AT 1.2 The future economic development in HR 2.2 CEE looks quite positive. HU 2.3 CZ 2.4 Main drivers are BG 2.6 private consumption UA 3.0 TR 3.2 falling unemployment rates
Slide 7: Growth initiatives
Growth initiatives Leveraging selected business areas Health Reinsurance Potential in the area of private health insurance business. VIG RE in 2016 • Founded in 2008 and by now well established VIG companies with health ins. • 52 employees Focus on health insurance • Active in 31 countries • S&P rat
Slide 8: Successful partnership with Erste Group
Successful partnership with Erste Group 2016: ~EUR 1.3bn of premiums generated as a result of bankassurance cooperation Promotion of bank insurance with Erste Group Common project together with Erste Group Target: optimisation of products, distribution and profits for both with focus on health and C
Slide 9: Digitisation: Decentralised approach with local companies acting as innovation labs
Digitisation: Decentralised approach with local companies acting as ‘innovation labs’ Customer behaviour and online preferences differ between generations and across countries Local companies develop appropriate digital solutions according to customer needs in terms of products, services and distrib
Slide 10: Highlights & Agenda 2020
Highlights & Financials & Dividend & Agenda 2020 Investments Outlook Appendix 1: Appendix 2: Main regions Financials Highlights / Agenda 2020 Financials Outlook Main regions Appendix
Slide 11: Preliminary results for the financial year 2016
Preliminary results for the financial year 2016 Sound development of top and bottom line €9,051mn Growth of 0.3% despite reduced life single premium business Solid premium increases in all lines of business except for life single GWP premium business (-19.2%) GWP excl. life single premium business u
Slide 12: Overall premium growth mainly influenced by life single premium reduction
Overall premium growth mainly influenced by life single premium reduction Overview of premiums by segments (I) Gross written premiums (€mn; y-o-y chg.) 12M15 12M16 -2.8% 4,055.5 3,941.3 -1.7% +2.2% -2.3% 1,554.8 1,529.1 +24.4% 716.5 732.3 838.9 819.2 428.6 533.4 Austria Czech Republic Slovakia Polan
Slide 13: Solid premium growth in CEE region
Solid premium growth in CEE region Overview of premiums by segments (II) Gross written premiums (€mn; y-o-y chg.) 12M15 12M16 -13.9% +7.9% 410.0 353.0 +9.8% +14.5% 331.4 307.2 +136.4% +4.3% 224.2 208.7 204.3 182.3 140.2 131.1 136.7 59.3 The Baltic Hungary Bulgaria Turkey/ Remaining CEE Other markets
Slide 14: Reduction in life single premium business compensated by growth in other lines
Reduction in life single premium business compensated by growth in all other lines of business Gross written premiums (€mn; y-o-y chg.) MTPL Casco Other property Total premiums +10.8% +8.2% +4.8% +0.3% 1,300 959 3,580 3,752 9,020 9,051 1,173 886 MTPL 1,173 1,300 Casco 886 959 12M15 12M16 12M15 12M16
Slide 15: Group PBT of €406.7mn
Group PBT of €406.7mn Overview of profits by segments (I) Profit before taxes (€mn; y-o-y change) 12M15 12M16 -7.9% 213.0 -6.3% 196.1 163.0 152.8 -5.8% -91.0% 51.9 48.9 20.8 1.9 3.5 -46.4 Austria Czech Republic Slovakia Poland Romania Due to new segmentation in line with amended Cash Generating Unit
Slide 16: Overview of profits by segments (II)
Overview of profits by segments (II) Profit before taxes (€mn; y-o-y change) +9.5% 12M15 12M16 22.2 20.2 +180.4% +13.3% 9.0 6.6 7.4 5.4 3.8 3.2 -2.6 -2.4 -4.7 -11.2 The Baltic Hungary Bulgaria Turkey/ Remaining CEE Other markets Georgia The Baltic: Start-up costs and non-life portfolio transfer impa
Slide 17: Combined ratio (P&C) stable at 97.3%
Combined ratio (P&C) stable at 97.3% P&C Combined ratio development P&C CoR 12M y-o-y regional development (net, %) 97.5 AT +0.1%p 97.6 97.3 97.8 97.9 97.9 97.3 90.7 CZ -0.2%p 30.6 33.3 31.4 30.5 30.4 90.5 96.2 SK -1.3%p 94.9 66.7 64.5 66.5 67.4 66.9 99.3 PL +0.1%p 99.4 102.4 RO -2.4%p 12M15 3M16 6M
Slide 18: Investment split and bond portfolio overview
Investment split and bond portfolio overview Full consolidation of non-profit housing societies and rating change of CZ 12M 2016: Total €36.2bn Bond portfolio by rating1 Other 6% 5% 6.3% 17% 19% 1.2% BBB 0.0% 7.7% Real Estate total A 31% 15.7% 41% 5.8% AA 34% 24% AAA 11% 10% 9.8% 12M15 12M16 4.0% 65
Slide 19: Financial result decreased by 7.8%
Financial result decreased by 7.8% Financial result incl. at equity consolidated companies Income Total in € '000 12M 2016 12M 2015 +/-% Overall financial result as Current income 1,189,381 1,114,776 6.7 expected down by €81.4mn in Income from appreciations 59,372 21,066 181.8 2016 Income from the d
Slide 20: Equity as of 12M 2016
Equity as of 12M 2016 12M 2015 restated for changed valuation of non-profit housing societies Change in Group Shareholders’ Equity (€mn) +29% 971 5,802 124 321 -24 -95 4,505 Equity restated Profit for the period Currency changes AFS unrealised Dividend payment Other (incl. Equity as of 12M16 as of 1
Slide 21: Dividend & Outlook
Highlights & Financials & Dividend & Agenda 2020 Investments Outlook Appendix 1: Appendix 2: Main regions Financials Highlights / Agenda 2020 Financials Outlook Main regions Appendix
Slide 22: Increased dividend proposal €0.80 per share
Increased dividend proposal €0.80 per share Payout ratio 35.6% EPS (€) Dividend per share1 (€) Dividend yield (%) 2.16 3.76 2.37 0.80 0.60 0.44 2015 2016 2015 2016 2015 2016 1: €0.80 subject to approval of the statutory bodies YE prices: €25.29 €21.30 Unchanged dividend policy Distribution of at lea
Slide 23: Outlook for 2019
Outlook for 2019 Stable development and continuous improvement Gross written premium 2019 VIG plans to steadily increase the premium volume to €9.5bn by 2019 Outlook Profit before taxes Despite the low interest rate environment and the continued negative effect this is expected to have on the financ
Slide 24: Appendix 1: Main regions
Highlights & Financials & Dividend & Agenda 2020 Investments Outlook Appendix 1: Appendix 2: Main regions Financials Note: Rounding differences may occur when rounded amounts or percentages are added up. Highlights / Agenda 2020 Financials Outlook Main regions Appendix
Slide 25: Austria: PBT decrease in P&C driven by lower financial result
Austria: PBT decrease in P&C driven by substantially lower financial result CoR nearly unchanged compared to last year GWP development (€mn) P&L: P&C business (€mn) -2.8% 12M16 Y-o-Y 4,056 Underwriting and financial result 65.5 -51.8% 3,941 MTPL 321 Other non-technical result -1.6 -90.6% 316 Casco 2
Slide 26: Czech Republic: less financial result reason for decreased PBT
Czech Republic: less financial result reason for decreased PBT Excellent CoR of 90.5% GWP development (€mn) P&L: P&C business (€mn) -1.7% 12M16 Y-o-Y 1,555 1,529 Underwriting and financial result 78.4 -0.4% Other non-technical result -4.2 -1.4% MTPL 257 266 Result (pre tax) 74.2 -0.4% Casco 190 Clai
Slide 27: Slovakia: significantly improved cost ratio
Slovakia: significantly improved cost ratio Overall CoR down to 94.9% GWP development (€mn) P&L: P&C business (€mn) +2.2% 12M16 Y-o-Y 732 Underwriting and financial result 24.6 11.4% 716 Other non-technical result -1.6 n.a. 131 136 MTPL Result (pre tax) 23.0 -12.3% Claims ratio 61.9% 4.3%p Casco 90
Slide 28: Poland: lower financial result and negative one-off in life
Poland: lower financial result and negative one-off in life are main drivers for PBT decrease CoR at 99.4% rather stable compared to last year GWP development (€mn) P&L: P&C business (€mn) -2.3% 839 12M16 Y-o-Y 819 Underwriting and financial result 21.7 -35.4% MTPL 151 148 Other non-technical result
Slide 29: Romania: considerable premium increase and solid PBT growth
Romania: considerable premium increase and solid overall PBT growth CoR further decreased but not yet below 100% GWP development (€mn) P&L: P&C business (€mn) +24.4% 12M16 Y-o-Y 533 Underwriting and financial result 7.5 >100 Other non-technical result -10.2 -80.6% 429 232 Result (pre tax) -2.6 -94.9
Slide 30: Premium development of new segments (I)
Premium development of new segments (I) The Baltic GWP development (€mn) Hungary GWP development (€mn) +136.4% +9.8% 140 224 204 14 MTPL MTPL 15 32 11 Casco Casco 15 16 49 46 16 Other Property Other Property 5 4 59 15 Health Health 77 82 8 43 Life regular Life regular 37 Life single Life single 52 5
Slide 31: Premium development of new segments (II)
Premium development of new segments (II) Remaining CEE GWP development (€mn) Other markets GWP development (€mn) +7.9% -13.9% 331 410 307 MTPL 353 83 Other Property 101 83 Casco 40 109 40 Life regular 73 Other Property 92 75 Health 83 8 8 237 Life regular Life single 64 63 169 Life single 46 29 12M1
Slide 32: Appendix 2: Financials
Highlights & Financials & Dividend & Agenda 2020 Investments Outlook Appendix 1: Appendix 2: Main regions Financials Note: Rounding differences may occur when rounded amounts or percentages are added up. Highlights / Agenda 2020 Financials Outlook Main regions Appendix
Slide 33: Key financials
12M 2016 Key financials Overview of KPIs Net Profit after tax and minorities (€mn) Combined Ratio (net, %) 330 97.3 97.3 288 96.7 70 2014* 2015* 2016 2014 2015 2016 EPS1 (€) ROE after tax and minorities (%) 7.9 2.46 7.1 2.16 3.3 0.44 2014* 2015* 2016 2014* 2015* 2016 1: EPS net of hybrid interest *
Slide 34: Income statement
12M 2016 Income statement IFRS (€mn) / 12M 2015 restated €mn 12M 2016 12M 2015 +/-% Gross premiums written 9,051.0 9,019.8 0.3 Net earned premiums 8,191.3 8,180.5 0.1 Financial result1 958.8 1,040.2 -7.8 Other income 150.4 150.2 0.2 Total income 9,300.5 9,370.9 -0.8 Expenses for claims and insurance
Slide 35: Balance sheet
12M 2016 Balance sheet IFRS (€mn) / YE 2015 restated €mn 31.12.2016 31.12.2015 +/-% Intangible assets 2,145 2,080 3.1 Investments 34,646 30,142 14.9 Unit- and index-linked investments 8,550 8,144 5.0 Reinsurers’ share in underwriting provisions 985 1,031 -4.4 Receivables 1,460 1,392 4.9 Tax receivab
Slide 36: P&L by segment (I)
12M 2016 P&L by segment (I) IFRS (€mn) / 12M 2015 restated Austria Czech Republic Slovakia €mn 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Gross premiums written 3,941.3 4,055.5 -2.8 1,529.1 1,554.8 -1.7 732.3 716.5 2.2 Net earned premiums 3,247.9 3,370.0 -3.6 1,151.5 1,204.
Slide 37: P&L by segment (II)
12M 2016 P&L by segment (II) IFRS (€mn) / 12M 2015 restated Poland Romania The Baltic €mn 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Gross premiums written 819.2 838.9 -2.3 533.4 428.6 24.4 140.2 59.3 >100 Net earned premiums 669.7 716.3 -6.5 351.1 265.0 32.5 108.1 57.7 87.
Slide 38: P&L by segment (III)
12M 2016 P&L by segment (III) IFRS (€mn) / 12M 2015 restated Hungary Bulgaria Turkey/Georgia €mn 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Gross premiums written 224.2 204.3 9.8 136.7 131.1 4.3 208.7 182.3 14.5 Net earned premiums 174.6 159.7 9.3 96.5 89.0 8.4 102.1 92.7 1
Slide 39: P&L by segment (IV)
12M 2016 P&L by segment (IV) IFRS (€mn) / 12M 2015 restated Remaining CEE Other markets €mn 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Gross premiums written 331.4 307.2 7.9 353.0 410.0 -13.9 Net earned premiums 232.9 211.4 10.2 311.6 371.2 -16.1 Financial result1 36.6 36.5 0.4 19.9 18.9 5.3 Othe
Slide 40: P&L by segment (V)
12M 2016 P&L by segment (V) IFRS (€mn) / 12M 2015 restated Central Functions Consolidation TOTAL €mn 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Gross premiums written 1,324.8 1,248.9 6.1 -1,223.3 -1,117.7 n.a. 9,051.0 9,019.8 0.3 Net earned premiums 1,141.9 1,066.8 7.0 5.4
Slide 41: Financial result by segment (I)
12M 2016 Financial result by segment (I) IFRS (€ '000) / 12M 2015 restated Income Austria Czech Republic Slovakia Poland in € '000 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 Current income 808,895 832,249 102,412 109,521 43,938 44,453 30,824 37,296 Income from appreciati
Slide 42: Financial result by segment (II)
12M 2016 Financial result by segment (II) IFRS (€ '000) / 12M 2015 restated Income Romania The Baltic Hungary Bulgaria in € '000 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 Current income 14,138 12,346 5,161 3,519 8,589 9,915 23,571 21,912 Income from appreciations 1,269
Slide 43: Financial result by segment (III)
12M 2016 Financial result by segment (III) IFRS (€ '000) / 12M 2015 restated Income Turkey/Georgia Remaining CEE Other markets in € '000 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 Current income 9,208 7,782 37,025 36,905 20,056 19,978 Income from appreciations 1,745 2,550 211 167 1,356 2,
Slide 44: Financial result by segment (IV)
12M 2016 Financial result by segment (IV) IFRS (€ '000) / 12M 2015 restated Income Central Functions Consolidation Total in € '000 12M 2016 12M 2015 12M 2016 12M 2015 12M 2016 12M 2015 Current income 192,596 98,440 -59,402 -62,392 1,237,011 1,171,924 Income from appreciations 209 0 0 0 59,370 21,066
Slide 45: Development for P&C business according to VAG
12M 2016 development for P&C business according to VAG (Austrian Insurance Supervision Act) IFRS (€ '000) / 12M 2015 restated 12M 2016 12M 2015 +/-% Overall result for direct business Gross direct premiums written 4,751.29 4,478.28 6.1 Gross direct 462.58 517.86 -10.7 Underwriting result 408.74 399.
Slide 46: Development for life business according to VAG
12M 2016 development for life business according to VAG (Austrian Insurance Supervision Act) IFRS (€ '000) / 12M 2015 restated 12M 2016 12M 2015 +/-% Overall result for direct business Gross direct premiums written 3,746.57 4,009.89 -6.6 Gross direct 347.90 316.29 10.0 Underwriting result 0.00 0.00
Slide 47: Development for health business according to VAG
12M 2016 development for health business according to VAG (Austrian Insurance Supervision Act) IFRS (€ '000) / 12M 2015 restated 12M 2016 12M 2015 +/-% Overall result for direct business Gross direct premiums written 412.48 397.86 3.7 Gross direct 58.79 55.15 6.6 Underwriting result 0.00 0.00 0.00 F
Slide 48: Premiums by business lines and country (I)
12M 2016 Premiums by business lines and country (I) IFRS (€mn) GWP MTPL GWP Casco GWP Other property 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Austria 316.0 320.9 -1.5% 266.5 256.6 3.9% 1,261.1 1,252.9 0.7% Czech Republic 266.1 256.8 3.6% 213.4 190.3 12.1% 405.2 377.4 7.4%
Slide 49: Premiums by business lines and country (II)
12M 2016 Premiums by business lines and country (II) IFRS (€mn) GWP Life regular GWP Life single GWP Health 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% Austria 1,246.4 1,248.4 -0.2% 456.4 595.5 -23.4% 394.9 381.2 3.6% Czech Republic 534.0 507.6 5.2% 97.0 209.1 -53.6% 13.4 13
Slide 50: Country overview GWP / PBT / CoR
12M 2016 Country overview GWP / PBT / CoR IFRS (€mn) GWP Total Profit before taxes Combined Ratio net 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-% 12M 2016 12M 2015 +/-pp Austria 3,941.3 4,055.5 -2.8% 196.1 213.0 -7.9% 97.6% 97.5% 0.1 Czech Republic 1,529.1 1,554.8 -1.7% 152.8 163.0 -6.3% 90.5% 90.
Slide 51: Q4 2016 – Income statement
Q4 2016 – Income statement IFRS (€mn) / Q4 2015 restated €mn Q4 2016 Q4 2015 +/-% Gross premiums written 2,089.2 2,107.3 -0.9 Net earned premiums 2,032.4 2,033.2 0.0 Financial result1 255.6 258.5 -1.1 Other income 27.7 71.9 -61.5 Total income 2,315.6 2,363.7 -2.0 Expenses for claims and insurance be
Slide 52: P&C claims and cost ratio details
12M 2016 P&C claims and cost ratio details Claims ratio 12M y-o-y regional development (net, %pts) Remarks for claims incurred 12M15 12M16 Slovakia: claims ratio development distorted by non- recurring positive effect last year -1.1 +3.7 +6.0 0.0 +4.3 Poland: substantial increase due to challenging
Slide 53: Exchange rates
12M 2016 – Exchange rates 12M 2016 12M 2015 Balance Sheet Balance Sheet Country Currency P & L EUR P & L EUR EUR EUR Albania EUR/ALL 135.2300 137.3710 137.2800 139.7463 Belarus EUR/BYN 2.0450 2.2001 20 300.0000 17 654.5370 Bosnia EUR/BAM 1.9558 1.9558 1.9558 1.9558 Bulgaria EUR/BGN 1.9558 1.9558 1.9
Slide 54: VIG share (I)
VIG share (I) Current analyst recommendation split Share price development 12M 2016 Sell Buy High EUR 24.790 Low EUR 16.095 Price as of 30 Dec. EUR 21.300 Market cap. EUR 2.73bn Development YTD % -15.80 Hold VIG compared to ATX and Stoxx Europe 600 Ins. 115 105 95 85 75 65 55 Jan-16 Feb-16 Mar-16 Ap
Slide 55: VIG share (II)
VIG share (II) General information Shareholder structure Number of common shares: 128mn ISIN: AT0000908504 ~30% Wiener Städtische Free Float Listings: Wechselseitiger Versicherungsverein - Vienna – since 17 Oct. 1994 Vermögensverwaltung – Vienna Insurance Group ~70% Prague – since 5 Feb. 2008 Ticker
Slide 56: Contact details
Contact details Investor Relations Financial calendar 2017 Investor Relations Team Date Event 23 Mar. 2017 Preliminary results for the financial Vienna Insurance Group year 2016 Schottenring 30, 1010 Vienna E-Mail: investor.relations@vig.com 19 Apr. 2017 Annual Report and Embedded www.vig.com/ir Val
Slide 57: Disclaimer
Disclaimer IMPORTANT NOTICE These materials do not constitute or form part, or all, of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities in any jurisdiction in which such solicitation, offer or sale would be unlawful, nor shall pa
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