Vienna Insurance Group Ag · VIE:VIG

Vienna Insurance — Q1 2019 Earnings Presentation

47 slides from Vienna Insurance's earnings presentation, May 22, 2019

  1. Slide 1: 3M 2019 Results Presentation

    3M 2019 RESULTS PRESENTATION Vienna, 22 May 2019

  2. Slide 2: Presenting team and topics

    3M 2019 RESULTS CONFERENCE CALL Presenting team and topics Participants Topics  Liane Hirner, CFO  Highlights p. 3  Judit Havasi, Member of the Board  Financials & Investments p. 5  Peter Höfinger, Member of the Board  Solvency Ratio (YE 2018) p. 14  Appendix 1: Segments p. 23  Appendix 2: F

  3. Slide 3: Highlights

    HIGHLIGHTS FINANCIALS & INVESTMENTS SOLVENCY RATIO (YE 2018) APPENDIX 1: SEGMENTS APPENDIX 2: FINANCIALS Please note: Rounding differences may occur when rounded amounts or percentages are added up. 3 VIG VIENNA INSURANCE GROUP

  4. Slide 4: Highlights 3M 2019: Solid premium and profit growth

    HIGHLIGHTS 3M 2019 Solid premium and profit growth Gross written premium Profit before taxes Combined Ratio € 2,908.2mn € 127.5mn 96.8% GWP up by 2.9% (+€82mn) PBT increased by 8.7% (+€10mn) +0.6ppt due to weather-related claims  Strongest contribution by segment coming  Austria, Slovakia and Pola

  5. Slide 5: Financials & Investments

    HIGHLIGHTS FINANCIALS & INVESTMENTS SOLVENCY RATIO (YE 2018) APPENDIX 1: SEGMENTS APPENDIX 2: FINANCIALS Please note: The quarterly figures for net assets, financial position and results of operations are prepared in accordance with the International Financial Reporting Standards (IFRS). 5 VIG VIENN

  6. Slide 6: First quarter results in line with expectations

    FIRST QUARTER RESULTS IN LINE WITH EXPECTATIONS 3M 2019 Income statement €mn 3M 2019 3M 2018 +/- % Gross premiums written 2,908.2 2,826.1 2.9 Net earned premiums 2,303.0 2,203.1 4.5 Financial result1 186.6 238.4 -21.7  Financial result down by €52mn driven mainly by lower realised Other income 65.1

  7. Slide 7: Gross written premiums of €2.9bn up by 2.9%

    GROSS WRITTEN PREMIUMS OF €2.9bn UP BY 2.9% Overview by segments Gross written premiums (€mn; y-o-y chg.)  Premium growth drivers are the Baltics (+€36mn), Central Functions (+€22mn), Bulgaria (+€21mn), Poland (+€17mn) and Remaining CEE (+€15mn)  Premium decrease in the Czech Republic due to less

  8. Slide 8: Health growing strongest by nearly 10%; life single premium leveled out

    HEALTH GROWING STRONGEST BY NEARLY 10%; LIFE SINGLE PREMIUM BUSINESS LEVELED OUT AT A LOWER PREMIUM Gross written premiums by lines of business (€mn; y-o-y chg.); incl. Central Functions MTPL Casco Other property Total premiums +2.9% 3M 2018 410 311 1,412 2,826 2,908 -4.2% +8.6% +3.1% MTPL 410 393 3

  9. Slide 9: Group profit before taxes of €127.5mn up by 8.7%

    GROUP PROFIT BEFORE TAXES OF €127.5mn UP BY 8.7% Overview by segments Result before taxes (€mn; y-o-y change)  AT: €8mn profit growth; positive developments in life and health fully offset decline in P&C  CZ: €5mn decrease driven by a lower financial result and increased CoR  SK: increase of €4mn

  10. Slide 10: Combined ratio (P&C) at 96.8% up by 0.6ppt

    COMBINED RATIO (P&C) AT 96.8% UP BY 0.6PPT Increase mainly driven by two natcat events, snow pressure in Austria and storm Eberhard P&C Combined Ratio development Overview by segments (12M y-o-y development net, %)  AT and CZ with increased CoR due to snow pressure in AT +3.9%p +1.1%p +1.7%p -4.0%p

  11. Slide 11: Investment split and bond portfolio overview

    INVESTMENT SPLIT AND BOND PORTFOLIO OVERVIEW No major changes in first quarter 2019 3M 2019: Total €38.7bn Bond portfolio by rating1 3.9% 1.3% 6.1% AAA AA A BBB Other 3M 2019 10% 32% 36% 17% 5% 6.6% 12M 2018 10% 32% 35% 17% 6% 5.8% 66.3% Bond portfolio by issuer 10.0% 3M 2019 53% 7% 18% 22% Bonds De

  12. Slide 12: Financial result decreased by 21.0%

    FINANCIAL RESULT DECREASED BY 21.0% Stabilisation of current income Total Income 3M 2019 3M 2018 +/- % Current income 322,053 314,419 2.4  Financial result down by €48.0mn excl. at equity Income from appreciations 5,858 2,077 >100 consolidated companies  Overall contribution of housing societies I

  13. Slide 13: VIG well on track to reach targets

    VIG WELL ON TRACK TO REACH TARGETS Strategy of profitable growth with higher targets against tightening economic cycle Outlook unchanged Gross written Profit before Combined premium taxes Ratio Based on progress made through Agenda 2020 and VIG continuously strives 2019 €9.9bn €500mn - €520mn to imp

  14. Slide 14: Solvency Ratio (YE 2018)

    HIGHLIGHTS FINANCIALS & INVESTMENTS SOLVENCY RATIO (YE 2018) APPENDIX 1: SEGMENTS APPENDIX 2: FINANCIALS 14 VIG VIENNA INSURANCE GROUP

  15. Slide 15: Solvency ratio of VIG as of YE 2018 at 239%

    SOLVENCY RATIO OF VIG AS OF YE 2018 AT 239% SCR 2018 compared to SCR 2017 in EUR million VIG AG in EUR million 31.12.2018 31.12.2017 Solvency capital requirement 3,241 3,525 Market risk 3,072 3,377 Counterparty default risk 326 314 Life underwriting risk 2,082 1,874 239% Health underwriting risk 326

  16. Slide 16: Positive impact of PIM on SCR

    POSITIVE IMPACT OF PIM ON SCR Comparison of Standard Formula and Partial Internal Model as of 31.12.2018 in EUR million Reduction Reduction Reduction by 65% by 68% by 68% 1,907 891 669 386 284 122 Non-life underwriting risk NSLT NSLT*health healthunderwriting underwritingrisk risk Property risk Stan

  17. Slide 17: Solvency capital requirement (I)

    SOLVENCY CAPITAL REQUIREMENT (I) SCR as of 31.12.2018 and PIM effects in EUR million SCR PIM gross PIM effect 8 000 1,238 0 6 000 228 669 326 1,935 1,096 316 2,082 906 1,220 4 000 56 1,116 14 44 62 33 522 446 0 326 79 4,540 2 000 3,072 3,241 0 Market risk Counterparty Life Health Non-life Intangible

  18. Slide 18: Solvency capital requirement (II)

    SOLVENCY CAPITAL REQUIREMENT (II) Risk mitigating effects in EUR million Net SCR after diversification Diversification effects Loss-absorbing capacity of technical provisions PIM effects 5 000 1,238 4 000 1,096 1,116 569 56 395 0 316 446 522 228 62 0 33 506 27 183 274 3 000 79 116 1,025 14 1,008 1 2

  19. Slide 19: Solvency capital requirement (III)

    SOLVENCY CAPITAL REQUIREMENT (III) Allocation of risks  Market risk accounts for 47% of total  Life underwriting risk contributes 27% to  Operational risk ranks third with 9% of solvency capital requirement the total solvency capital requirement total solvency capital requirement  58% of total m

  20. Slide 20: Own funds (I)

    OWN FUNDS (I) Composition of Own Funds as of 31.12.2018 in EUR million EUR 7 734mn 2,500 1% 18% 2,000 2% Tier 3 1,512 1,506 1,500 Tier 2 Tier 1 - restricted 79% Tier 1 - unrestricted 1,000 1,430 500 143 119 67 0 VIG capital structure Tier 1 - restricted Tier 2 Tier 3 20 SOLVENCY II VIG VIENNA INSURA

  21. Slide 21: Own funds (II)

    OWN FUNDS (II) Own Funds 2017 compared to Own Funds 2018 in EUR million 8 500 8 000 254 29 368 242 128 32 195 7 500 7 000 7,764 7,734 6 500 6 000 Solvency II Own IFRS surplus Change in IFRS Repurchase of Differences in Deferred taxes Planned dividends Other Solvency II Own Funds 2017 equity reserves

  22. Slide 22: Sensitivity analysis

    SENSITIVITY ANALYSIS Market Sensitivities as of 31.12.2018 Interest rate curve +100bps -0.4% 238% Interest rate curve -100bps -20.9% 218% Equity -20pps -3.8% 235% Spread +100bps -15.6% 223% Rating downshift -1 notch -6.6% 232% Absolute change in Impact of absolute Solvency Ratio (pps) change on Solv

  23. Slide 23: Appendix 1: Segments

    HIGHLIGHTS FINANCIALS & INVESTMENTS SOLVENCY RATIO (YE 2018) APPENDIX 1: SEGMENTS APPENDIX 2: FINANCIALS Please note: The quarterly figures for net assets, financial position and results of operations are prepared in accordance with the International Financial Reporting Standards (IFRS). 23 VIG VIEN

  24. Slide 24: Austria

    AUSTRIA CoR at 96.6%; positive developments in life and health fully offset decline in P&C GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +0.5% Gross premiums written 1,278.8 1,272.9 0.5  Financial result decreased by €40.0mn 1,279 Net earned premiums 835.7 828.5 0.9 driven by lower income from di

  25. Slide 25: Czech Republic

    CZECH REPUBLIC Profit development impacted by increased CoR and lower financial result GWP development (€mn) €mn 3M 2019 3M 2018 +/- % -2.2% Gross premiums written 454.9 465.3 -2.2  Premiums down by €10.3mn mainly driven 465 Net earned premiums 339.0 320.2 5.9 by other property (-€21.6mn) 455 Finan

  26. Slide 26: Slovakia

    SLOVAKIA Normalisation of CoR after reserve strengthening in 3M 2018 GWP development (€mn) €mn 3M 2019 3M 2018 +/- % -3.1% Gross premiums written 209.6 216.2 -3.1  Premium decrease of €6.6mn driven by 216 Net earned premiums 167.2 169.9 -1.6 other property (-€3.5mn) and life single 210 premium busi

  27. Slide 27: Poland

    POLAND Strong premium and profit development GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +7.6% Gross premiums written 250.4 232.8 7.6  Premium growth of €17.6mn driven by 250 Net earned premiums 188.6 170.5 10.6 other property (+€21.8mn) due to start of Financial result 10.2 5.9 71.5 cooperatio

  28. Slide 28: Romania

    ROMANIA CoR improved compared to 107.5% at YE 2018, but still above 100% GWP development (€mn) €mn 3M 2019 3M 2018 +/- % -20.9% Gross premiums written 115.9 146.6 -20.9  Premiums down by €30.7mn mainly driven 147 Net earned premiums 95.1 99.8 -4.8 by MTPL business (-€30.9mn) Financial result 4.5 3.

  29. Slide 29: Baltic states

    BALTIC STATES First time consolidation of Seesam Insurance GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +37.2% Gross premiums written 133.3 97.2 37.2  Double-digit premium growth in all lines of 133 Net earned premiums 93.6 64.7 44.6 business Financial result 1.8 1.0 82.3 Other income 0.7 0.3 >1

  30. Slide 30: Hungary

    HUNGARY Strong top- and bottom-line growth GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +12.4% Gross premiums written 81.2 72.2 12.4  Premium growth mainly driven by MTPL 81 Net earned premiums 45.5 41.4 10.0 (+€5.6mn), other property (+€4.9mn) and Financial result 1.3 1.6 -18.9 health business

  31. Slide 31: Bulgaria

    BULGARIA Double-digit premium and profit growth GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +47.6% Gross premiums written 66.5 45.1 47.6  Premium growth of €21.mn; main 67 Net earned premiums 37.6 33.0 13.9 contributors are health (+€8.9mn) and Financial result 2.9 2.5 18.2 other property (+€7.

  32. Slide 32: Turkey/Georgia

    TURKEY/GEORGIA CoR in 3M 2019 improved q-o-q, but still above 100% GWP development (€mn) €mn 3M 2019 3M 2018 +/- % -13.5% Gross premiums written 56.8 65.7 -13.5  Adjusted for TRY FX effects, double digit 66 Net earned premiums 25.7 22.8 12.7 premium growth Financial result 2.8 2.0 44.3 Other income

  33. Slide 33: Remaining CEE

    REMAINING CEE Solid contribution to premium and profit development GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +16.3% Gross premiums written 107.6 92.5 16.3  Remaining CEE includes Albania (incl. 108 Net earned premiums 70.6 61.6 14.6 Kosovo), Bosnia-Herzegovina, Croatia, Financial result 9.6 5

  34. Slide 34: Other Markets

    OTHER MARKETS Germany and Liechtenstein GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +2.3% Gross premiums written 79.1 77.3 2.3  Premium increase driven by growth in all 79 Net earned premiums 65.0 63.6 2.3 lines of business in Germany 77 Financial result 4.6 5.3 -13.6 Other income 0.7 6.9 -89.5

  35. Slide 35: Central Functions

    CENTRAL FUNCTIONS Substantial improvement driven by financial result and other expenses GWP development (€mn) €mn 3M 2019 3M 2018 +/- % +5.0% Gross premiums written 453.1 431.6 5.0  Central Functions include VIG Holding, 453 Net earned premiums 338.8 323.5 4.7 VIG Re, VIG Fund, the non-profit Finan

  36. Slide 36: Appendix 2: Financials

    HIGHLIGHTS FINANCIALS & INVESTMENTS SOLVENCY RATIO (YE 2018) APPENDIX 1: SEGMENTS APPENDIX 2: FINANCIALS Please note: The quarterly figures for net assets, financial position and results of operations are prepared in accordance with the International Financial Reporting Standards (IFRS). 36 VIG VIEN

  37. Slide 37: 3M 2019 Key financials

    3M 2019 KEY FINANCIALS Overview of KPIs Net result for the period after taxes and non-controlling interest (€mn) ROE after taxes and non-controlling interests1 (%) 83 7.9 69 76 67 7.0 6.5 6.8 3M 16 3M 17 3M 18 3M 19 3M 16 3M 17 3M 18 3M 19 EPS net of hybrid interest1 (€) Book value per share2 (€) 2.

  38. Slide 38: Equity development in 3M 2019

    EQUITY DEVELOPMENT IN 3M 2019 Change in yield curve impacts valuation of fixed-yield investments Change in Group Shareholders’ Equity (€mn) +5% 205 6,126 -1 -5 101 -10 5,836 Equity as Profit for Currency AFS unrealised Dividend Other Equity as of 12M18 the period changes gains and losses payment of

  39. Slide 39: 3M 2019 Balance sheet

    3M 2019 BALANCE SHEET IFRS (€mn) €mn 31.03.2019 31.12.2018 +/- % Intangible assets 2,159 1,961 10.1 Investments 37,389 36,288 3.0 Unit- and index-linked investments 8,434 8,049 4.8 Reinsurers’ share in underwriting provisions 1,230 1,136 8.3 Receivables 1,782 1,563 14.1 Tax receivables and advance p

  40. Slide 40: 3M 2019 Premiums by business lines and country (I)

    3M 2019 PREMIUMS BY BUSINESS LINES AND COUNTRY (I) IFRS (€mn) MTPL Casco Other property 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- % Austria 110.7 110.3 0.3 99.5 94.1 5.7 555.3 545.5 1.8 Czech Republic 77.3 74.2 4.2 60.3 60.4 -0.3 136.0 157.6 -13.7 Slovakia 43.2 43.3 -0.3 27.6 2

  41. Slide 41: 3M 2019 Premiums by business lines and country (II)

    3M 2019 PREMIUMS BY BUSINESS LINES AND COUNTRY (II) IFRS (€mn) Life regular Life single Health 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- % Austria 341.8 345.7 -1.1 61.6 70.0 -11.9 110.0 107.3 2.5 Czech Republic 163.4 153.3 6.6 14.2 16.3 -12.6 3.8 3.5 9.4 Slovakia 43.3 43.3 0.1

  42. Slide 42: 3M 2019 Country overview GWP / PBT / combined ratio

    3M 2019 COUNTRY OVERVIEW GWP / PBT / COMBINED RATIO IFRS (€mn) GWP Total Result before taxes Combined Ratio net 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- % 3M 2019 3M 2018 +/- %p Austria 1,278.8 1,272.9 0.5 45.4 37.5 21.2 96.6% 95.6% 1.1 Czech Republic 454.9 465.3 -2.2 41.5 45.7 -9.2 95.6% 93.9% 1.7

  43. Slide 43: 3M 2019 Exchange rates

    3M 2019 EXCHANGE RATES Balance Sheet: period-end exchange rate / P&L: average exchange rate 2019 2018 Country Currency Balance Sheet P&L Balance Sheet P&L EUR EUR EUR EUR Albania EUR/ALL 125,3400 127.5752 130,4400 132,5390 Belarus EUR/BYN 2,3889 2.4051 2,4032 2,4248 Bosnia & Herzegovina EUR/BAM 1,95

  44. Slide 44: VIG Share (I)

    VIG SHARE (I) Number of common shares: 128,000,000 / ISIN: AT0000908504 General information Current analyst recommendation split Current listings Ticker Rating Major Indices SELL Vienna  Vienna Stock Exchange: VIG Standard & Poor´s: ATX 2 BUY Prague  Bloomberg: VIG AV / VIG CP A+, stable outlook A

  45. Slide 45: VIG Share (II)

    VIG SHARE (II) Shareholder structure Free float split by region1 North America 34% Continental Europe 27% ~70% ~30% Austria 25% UK & Ireland 12% Other 2% Wiener Städtische Versicherungsverein Free Float (Mutual) 1 Split of identified shares, April 2019 (Source: CMi2i) 45 APPENDIX 2: FINANCIALS VIG V

  46. Slide 46: Contact details / Financial calendar

    CONTACT DETAILS / FINANCIAL CALENDAR Investor Relations / investor.relations@vig.com / www.vig.com Nina Higatzberger-Schwarz Sylvia Machherndl Financial calendar 2019* Head of Investor Relations Team Leader Corporate Reporting Date Event Tel. +43 (0)50 390 – 21920 Tel. +43 (0) 50 390 – 21151 17 Apr.

  47. Slide 47: 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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