Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — ING EMEA Investment Forum 2007
24 slides from Vienna Insurance's conference presentation, Nov 27, 2007
Slide 1: Vienna Insurance Group – Expanding the CEE Insurance Business
Vienna Insurance Group – Expanding the CEE Insurance Business ING EMEA Investment Forum, 27 November 2007
Slide 2: Investment Case in Brief
Investment Case in Brief What is unique about VIG? 2 VIG has broadest diversification VIG is the purest CEE insurance in this fast growing region play among listed insurance Operates in countries with stable companies 1 2 legal and regulatory regimes CEE business is vital GDP and insurance
Slide 3: VIG Strategy Delivers: Strong increase in profitability
VIG Strategy Delivers Strong increase in profitability 3 VIG's Path of Profitability Comments 8,000 450 GWP 400 From 2002 to 2006 VIG succeeded 7,000 PBT in nearly doubling Group gross 6,000 350 written premiums implying a CAGR 300 of more than 17% GWP in €mn PBT in €mn 5,000 250 4,000 200 From
Slide 4: Purest CEE Insurance Play
Purest CEE Insurance Play VIG is the leading Austrian insurance group operating in 20 countries 4 Footprint CEE Premiums as % of Total Group Premiums 37.5% Core Markets VIG 31.1% 28.7% 12.6% 2006 UNIQA 10.2% 2005 10.1% 2004 3.6% Allianz 3.3% 3.0% 2.6% VIG‘s unique share of CEE ING 2.3% business grow
Slide 5: VIG – Top Player in its CEE Markets
VIG – Top Player in its CEE Markets Number 2 among international insurance groups 5 Market Share in CEE2 Market Share in CEE2 Non-life ~ 17.1% ~ 15.7% ~ 13.2% ~ 12.3% ~ 13.4%1 ~ 11.1%1 ~ 5.9% ~ 4.9% ~ 4.8% ~4.5% ~ 3.3% ~0.0% G qa G z i C al an G VI IN G B a C nz li er ni iq K VI IN ra lli KB U en li
Slide 6: VIG Is Well Positioned in Its Markets
VIG Is Well Positioned in Its Markets Broad portfolio of insurance markets with different dynamics 6 Group 11 Market Number of Pop: 48.5 mn Position Countries A BG GEO RO GDP/Cap.: $ 7,2162 CZ SK TOP 7 AL Density: $ 2063 3 Group 1 CRO TOP 2 SER Group 2 5 Group 2 Pop: 60.6 mn PL TOP GDP/Cap.: $ 8,663
Slide 7: Geographical Diversification Enhanced
Geographical Diversification Enhanced GWP split by region 7 GWP by Geography 9M 05 GWP by Geography 9M 06 GWP by Geography 9M 07 Other Other Other Other CEE 5.3% 3.7% 3.5% 5.9% Other CEE Other CEE PL: 1.3% 12.7% 18.2% RO: 2.3% PL: 5.4% PL: 7.8% RO: 3.9% RO: 6.0% Slovakia Austria Austria Austria 6.7%
Slide 8: CEE Region Offers Twin Growth
CEE Region Offers Twin Growth Sustainable growth through GDP and insurance penetration 8 4,000 GDP Growth Insurance EU-15 Penetration Mature Markets 2006 – 2008F 20061 CEE2 5.5% 3.3% Insurance Density (USD) Austria 2.8% 6.2% EU 15 2.5% 9.3% A 2,000 RUS SLO BG UKR RO CRO SK H PL SER CZ TR Growth Mark
Slide 9: VIG Markets – Underpenetrated in Insurance
VIG Markets – Underpenetrated in Insurance Insurance density, 2006 (Premiums per Capita) 9 Insurance Density 2006 Example: Romania $3,500 Market volume Romania 3,305 Life YE 2006: USD 2.0bn Non-life $3,000 Assuming that Romania will reach $2,500 2,397 density level of Czech Republic in 2006 this
Slide 10: CEE – A Long-term Growth Perspective
CEE – A Long-term Growth Perspective Markets need at least 20 years to catch up with the Austrian level of 2000 10 Austrian Insurance market CEE Insurance markets in 2006 Premium Insurance Insurance GDP/Capita GDP/Capita Year income penetration Density (EUR) penetration Density (EUR) (EUR) (EUR) (EU
Slide 11: Acquisitions: A systematic approach
Acquisitions A systematic approach 11 Acquisition Process Acquisition of Ukrainian UIG* Sound risk assessment of target company TBIH Criteria (60% owned by VIG) What does the company add to help us grab the lion´s share of future growth 62 % Appraisal of management skills UIG Leveraging of l
Slide 12: Management Approach
Management Approach Excellent track record in integrating CEE subsidiaries into VIG 12 Management Approach Track Record Local incumbent management is responsible for CEE already contributes 40 percent of sales and profitability - usually one board premium income and more than 30 percent of membe
Slide 13: Profit Drivers in CEE
Profit Drivers in CEE Creating value from cost ratio, investment income and reinsurance 13 Earnings Potential Comments Loss Ratio (%) Cost Ratio (%) Decrease in cost ratio 100 - economies of scale in less advanced markets 80 - cost reduction programmes in advanced 60 markets 40 - shared services 2
Slide 14: VIG – Distribution Is Key (I)
VIG – Distribution Is Key (I) Multi-brand policy to retain loyalty 14 Multi-brand Features VIG is umbrella brand and “family name” of Group companies Local companies retain individual brands as “first name” Strong brand awareness in local markets Retain loyalty of employees and management, c
Slide 15: VIG – Distribution Is Key (II)
VIG – Distribution Is Key (II) Multi-channel strategy to get access to customers 15 Strong Multi-channel distribution Details Tied agents (employed sales force and/or exclusive agents) are backbone in all markets Tied Extensive use of brokers, bank agents Financial cooperations, multilevel and d
Slide 16: VIG in Austria
VIG in Austria Attractive franchise plus catch up potential in life insurance 16 Situation in Austria Details Market Shares in Austria Leading market position in all business lines 25% Source: VVO 23.3% 21.5% VIG 23% 21.3% 21.7% - #1 in property & casualty with 21% market 21% 21.7% UNIQA 19.1% 21.
Slide 17: Financial Targets
Financial Targets Ambitious Group targets for the period of 2007 - 2010 17 VIG’s Financial Targets Comments 9M results allow to expect YE 2007 PBT of about Profit before tax targets in € mn € 435mn ~770 PBT target for 2008 set at ~€ 530mn CAGR: ~21% For the first time VIG sets PBT target for 2
Slide 18: VIG Outperforming Promises
VIG Outperforming Promises Progress in VIG´s strategic and operative position 18 Undertaking two years ago Position today Strengthening Increased market share in of leading position in Austria Austria by more than 2% pts – Expansion of CEE business VIG clearly no. 1 through acquisitions and or
Slide 19: Vienna Insurance Group - 9M 2007 results Highlights
Vienna Insurance Group- 9M 2007 results Highlights
Slide 20: 9M 2007 Highlights (I)
9M 2007 Highlights (I) CEE business expanding at fast pace 20 Continued organic growth in all major markets – increase of market shares CEE premium share in non-life at 55% Total CEE business already at 42% of Group premiums Poland and Romania new business segments due to dynamic growth PB
Slide 21: 9M 2007 Highlights (II)
9M 2007 Highlights (II) GWP growing faster than in first half year; C/R below 96% 21 GWP Profit before Tax 16.5% 40.5% 321 324 5,882 5,008 5,032 240 4,321 231 4,101 3,778 188 156 2004 2005 2006 9M 05 9M 06 9M 07 2004 2005 2006 9M 05 9M 06 9M 07 IFRS IFRS Net Profit after Tax and Minorities Combined
Slide 22: 9M 2007 Highlights (III)
9M 2007 Highlights (III) Record EPS; ROE climbing fast towards 18% 22 EPS (annualised) ROE before Tax 3.18 23.9 21.9 2.48 19.5 2.27 2.32 17.6 14.8 14.8 1.64 1.41 2004 2005 2006 9M 05 9M 06 9M 07 2004 2005 2006 9M 05 9M 06 9M 07 IFRS IFRS
Slide 23: Contact Details
Contact Details Investor Relations 25 Wiener Städtische Versicherung AG Vienna Insurance Group Schottenring 30, 1010 Vienna, Austria www.wienerstaedtische.com Vienna Stock Exchange: WST Reuters: WISV.VI Bloomberg: WST AV Datastream: O:WNST Thomas Schmee Tel. +43 (0)50 350 – 21900 t.schmee@staedtis
Slide 24: Disclaimer
Disclaimer 26 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
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