Tower Limited · NZX:TWR
Tower — NZ Investment Conference 2005
17 slides from Tower's conference presentation, Feb 24, 2005
Slide 1: Company announcement cover letter
24 February 2005 Market Information Company Announcements Office New Zealand Exchange Limited Australian Stock Exchange Limited ASB Bank Tower Exchange Centre Level 9, 2 Hunter Street Level 6, 20 Bridge Street Wellington Sydney NSW 2000 NEW ZEALAND AUSTRALIA ARBN 088 481 234 Incorporated in New Zeal
Slide 2: Business Strategy and Competitive Pressures
TOWER Business Strategy and Competitive Pressures Presentation to NZ Investment Conference Jim Minto Chief Executive Officer Designate (1 March 2005) TOWER Limited 24 February 2005
Slide 3: Key Facts about TOWER
Key Facts about TOWER be Market Capitalisation: approx NZ$720 million Shares on issue: 356.7 million (Listed on NZX and ASX) Major Business Lines: — New Zealand risk — life, health, fire & general — New Zealand investment — wholesale and retail — Australian risk — life — Australian investment — supe
Slide 4: Operational Structure
TOWER Operational Structure TOWER Group CFO Group Gen Mgr cEO CEO cEO CEO CEO TOWER Group TOWER Group Risk Business Investment Gen Insurance Health & Life Investment John de Zwart William Australia Business & Direct Business NZ Business Giesbers David Australia Business NZ VACANT NZ Callander VACANT
Slide 5: External Environment
External Environment ® Wider and more demanding regulatory environment ® Increased compliance requirements and costs ® Demographic changes — ageing and wealthier retirees; lifestyle work patterns & Growing consumer expectations — fees, product features, flexibility and performance Industry rationali
Slide 6: Insurance Sector Dynamics
Insurance Sector Dynamics ® Under insurance and marketing ® Mortgage growth away from banks ® Impact of FSR in Australia ® New channels
Slide 7: Insurance Sector Dynamics
Insurance Sector Dynamics ® Sound underlying thematics and company fundamentals ® Early evidence of improvement in industry net fund flows but preference to write this business outside of Life company structures ® Surplus capital/retum of capital Choice of Fund (Australia) & Key Risks ~ investment m
Slide 8: Australia (TAL)
TOWER Australia (TAL) » Specialist risk provider ® Main product lines — Life risk insurance (personal and group) — Related investment products ® TAL is ranked 8" in the Australian life risk market — 6% market share in life risk and disability risk markets — 5% market share in the group risk market ®
Slide 9: Australia (TAL)
TOWER Australia (TAL) & Operational and strategic focus — Risk sales growth — Investment business — reposition/grow — Increase market share — grow faster than the market ~ Development of new sales channels — Retention rates — Management expenses — Development of people and culture
Slide 10: New Zealand (TNZ)
TOWER New Zealand (TNZ) ® Retail General Insurance provider and solely direct » 9% market share personal lines ® Direct capability and brand
Slide 11: New Zealand (TNZ)
TOWER New Zealand (TNZ) ® Life and Health specialist plus funds management ® Main product fines — Life risk/Health insurance (personal and group) ~ Wholesale investment management/Retail managed funds Market position — Second largest health insurer (15% by lives) — 5% market share — in-force life ri
Slide 12: New Zealand Direct Strategy
New Zealand Direct Strategy ® Leverage Direct Brand i» Multiple sales per client (House, Contents, Car, Travel, Health, Life and Investment) & Extend Alliances ®& Extend product range & Efficiency and sound underwriting “
Slide 13: New Zealand (TNZ) Intermediated Lines
TOWER New Zealand (TNZ) Intermediated Lines ® Operational and strategic focus ~ Sales growth ~ Health —- 2 main health companies in intermediated lines ~ Leverage Life sales off Health — Increase market share — grow faster than the market — Retention rates to improve — Management expenses to reduce
Slide 14: New Zealand (TNZ) Investment Business
TOWER New Zealand (TNZ) Investment Business Wholesale manager plus focused retail &® Simplify business » Lower costs ® Release value via profit turnaround a
Slide 15: Corporate Strategy/Focus
Corporate Strategy/Focus ® Anew phase — Trans Tasman growth Re-establishing TOWER as a leading risk and complementary investment business on both sides of the Tasman ®& Continued drive for simplification of the business ® Better focus on core offering and markets that are not dominated by bank owned
Slide 16: Growth Strategies
Growth Strategies Organic Growth — Strong focus on distribution relationships — Leverage direct ® Develop Alliance Partnerships ~ Insurance Line — AFG ~ ANZ/National Bank — Develop more opportunities ® Selective Acquisitions — Add capability where opportunity genuinely can add value 15
Slide 17: Summary
Summary ® Structure to focus on each competitive market » Next steps in TOWER’s transformation - taking TOWER in both New Zealand and Australia to higher levels of success ® Separate initiatives to drive each business line at faster than market growth ® More focussed, leaner, tighter and harder Stro