Scor SE · EURONEXT:SCR
Scor — H1 2014 Earnings Presentation
56 slides from Scor's earnings presentation, 2014
Slide 1: SCOR Group H1 2014 results
SCOR GROUP H1 2014 results SCOR delivers a strong performance for the first half of 2014 with a net income of EUR 256 million, up 35% from H1 2013
Slide 2: Notice
Notice Cautionary statement: Certain statements contained in this presentation are forward-looking statements, of necessity provisional, that are based on risks and uncertainties that could cause actual results, performance or events to differ materially from those in such statements. Undue reliance
Slide 3: Two sets of financial data: published accounts and pro-forma information
In the presentation two sets of financial data are used: published accounts & pro-forma information Unaudited 2013 published half-year accounts: The unaudited 2013 half-year accounts have been prepared to reflect the acquisition of Generali U.S. They include the results generated by Generali U.S.
Slide 4: Strong H1 2014 results in line with Optimal Dynamics
SCOR delivers strong results during the first half of 2014, in line with the new strategic plan “Optimal Dynamics” Records a strong financial performance, with ROE of 10.3%, above “Optimal Dynamics” target Provides its shareholders with a consistent dividend policy: € 1.3 per share in cash, +8%
Slide 5: Solvency: capital position under 2014 Group Internal Model is very strong
SCOR’s capital position under the 2014 Group Internal Model1) is very strong The 2014 Solvency level is 5% above the optimal solvency range SCOR’s capital management is based on the in € billions (rounded) 2014 Group Internal Model1) (GIM) Under the 2014 GIM, SCOR’s capital position in 2014 is j
Slide 6: Strong financial results for the first half of 2014
SCOR delivers strong financial results for the first half of 2014 Gross written premium growth of 8.9%1) (12.5% at constant exchange rates) in H1 2014 compared to H1 2013, driven by healthy SCOR Global P&C renewals, by major new contracts signed by SCOR Global Life and by the Generali US Life Re a
Slide 7: SCOR H1 2014 financial details
SCOR H1 2014 financial details H1 2013 Variation at Variation at H1 2013 Variation at Variation at in € millions (rounded) H1 2014 Published current FX constant FX Pro-forma current FX constant FX Gross written premiums 5 427 4 984 8.9% 12.5% 5 414 0.2% 3.5% Net earned premiums 4 779 4 463 7.1% 11.0
Slide 8: Shareholders' equity development with BVPS at €27.39
SCOR records positive shareholders’ equity development with a BVPS at € 27.39 after distribution of € 243 million of cash dividends Q2 2014 development In € millions (rounded) 21.2%1) Financial leverage decreased by 0.4 pts 20.8 %1) 1 404 1 404 1 379 109 41 4 256 - 243 SCOR’s financial leverage st
Slide 9: Cash & liquidity position reduced in line with Optimal Dynamics
Cash & liquidity position reduced in line with “Optimal Dynamics” assumptions, with operational cash flows impacted by one-off items Operating cash flow of € 2 million as at 30 June 2014: In € millions (rounded) H1 2014 H1 2013 SCOR Global P&C affected by payments related to 2013 nat cat, a clai
Slide 10: SCOR Global P&C delivers excellent technical profitability
In H1 2014, SCOR Global P&C delivers excellent technical profitability, with a net combined ratio of 90.9% Gross written premiums In € millions H1 2014 gross written premium growth of 0.9% +0.9% (+ 4.7% at constant exchange rates) negatively impacted by foreign exchange rates and catching up on +4
Slide 11: June-July renewals show premium volume increase of 4.6%
June-July renewals show an overall premium volume increase of 4.6% up to € 416 million, and confirm SGPC’s strong franchise Premiums renewed in June-July1) in € millions, rounded June-July renewals represent only 10% of the total annual Change in % -7% -8% +6% +9% +6% -1% +4.6% 416 volume of SGPC
Slide 12: Expected profitability trend in line with past underwriting years
The expected profitability trend is in line with past underwriting years, on a year-to-date basis Expected gross underwriting ratio1) trend, year to date On a year to date basis, the 2014 renewals’ expected profitability deteriorates compared to 2013 by around one percentage point in terms of gros
Slide 13: SCOR Global Life confirms strong technical performance
SCOR Global Life confirms a strong technical performance in H1 2014 Gross written premiums In € millions (rounded) -0.3% H1 2014 gross written premium growth of 2.6% at constant FX compared to H1 2013 pro-forma (-0.3% at current FX) +2.6% (at constant On a published basis, the growth is 19.5% at
Slide 14: Generali US integration essentially completed
The integration of the Generali US acquisition is essentially completed, confirming SCOR Global Life’s leading position in the US Successful Generali US integration Maintained leadership position Done 2013 US life reinsurance recurring new business volume In progress Face amount, in USD billions 1
Slide 15: SCOR Global Investments delivers return on invested assets of 2.9%
SCOR Global Investments delivers a return on invested assets of 2.9% Total invested assets1): € 14.7 billion at 30/06/2014 In % (rounded) Other investments2) 3% Cash 9% Liquidity 11% Total investments of € 23.0 billion, of which total Real estate 5% Short-term invested assets of € 14.7 billion and
Slide 16: 2014 forthcoming events and Investor Relations contacts
2014 forthcoming events and Investor Relations contacts Forthcoming scheduled events 10 September 2014 6 November 2014 SCOR Group: SCOR Group: Investors’ Day Q3 2014 results In 2014 SCOR is scheduled to attend the following investor conferences KBW, London (September 17th) UBS, New York (Nov
Slide 17: The SCOR IR app
The SCOR IR app puts SCOR at the fingertips of investors Home Page Latest press releases Financial communication Share price monitor Conference presentations Research Publications Push notifications Contacts 17
Slide 18: Appendices
APPENDICES Appendix A P&L Appendix B Balance sheet & Cash flow Appendix C Calculation of EPS, Book value per share and ROE Appendix D Expenses & cost ratio Appendix E P&C Appendix F Life Appendix G Investment Appendix H Debt Appendix I Rating evolution Appendix J Listing information Appendix K Award
Slide 19: Consolidated statement of income, H1 2014
Appendix A: Consolidated statement of income, H1 2014 H1 2013 H1 2013 In € millions (rounded) H1 2014 Pro-forma Published Gross written premiums 5 427 5 414 4 984 Change in gross unearned premiums -144 -28 -28 Gross benefits and claims paid -3 759 -3 840 -3 495 Gross commissions on earned premiums -
Slide 20: Consolidated statement of income by segment for H1 2014
Appendix A: Consolidated statement of income by segment for H1 2014 H1 2013 H1 2013 H1 2014 Pro-forma Published Group Intra- Group Intra- Group Intra- In € millions (rounded) Life P&C functions Group Total Life P&C functions Group Total Life P&C functions Group Total Gross written premiums 3 027 2 4
Slide 21: SCOR Q2 2014 financial details
Appendix A: SCOR Q2 2014 financial details Q2 2013 Variation at Variation at Q2 2013 Variation at Variation at in € millions (rounded) Q2 2014 Published current FX constant FX Pro-forma current FX constant FX Gross written premiums 2 758 2 596 6.2% 10.4% 2 813 -2.0% 1.8% Net earned premiums 2 461 2
Slide 22: Consolidated statement of income, Q2 2014
Appendix A: Consolidated statement of income, Q2 2014 Q2 2013 Q2 2013 In € millions (rounded) Q2 2014 Pro-forma Published Gross written premiums 2 758 2 813 2 596 Change in gross unearned premiums -39 20 20 Gross benefits and claims paid -1 960 -2 043 -1 868 Gross commissions on earned premiums -494
Slide 23: Consolidated statement of income by segment for Q2 2014
Appendix A: Consolidated statement of income by segment for Q2 2014 Q2 2013 Q2 2013 Q2 2014 Pro-forma Published Group Intra- Group Intra- Group Intra- In € millions (rounded) Life P&C functions Group Total Life P&C functions Group Total Life P&C functions Group Total Gross written premiums 1 560 1 1
Slide 24: Consolidated balance sheet - Assets
Appendix B: Consolidated balance sheet - Assets In € millions (rounded) H1 2014 Q4 2013 Intangible assets 2 314 2 307 Goodwill 788 788 Value of business acquired 1 389 1 393 Other intangible assets 137 126 Tangible assets 541 544 Insurance business investments 22 310 22 272 Real estate investments 8
Slide 25: Consolidated balance sheet – Liabilities & shareholders' equity
Appendix B: Consolidated balance sheet – Liabilities & shareholders’ equity In € millions (rounded) H1 2014 Q4 2013 Group shareholders’ equity 5 110 4 940 Non-controlling interest 37 40 Total shareholders’ equity 5 147 4 980 Financial debt 1 893 2 053 Subordinated debt 1 404 1 379 Real estate financ
Slide 26: Consolidated statements of cash flows
Appendix B: Consolidated statements of cash flows In € millions (rounded) H1 2014 H1 2013 Cash and cash equivalents at the beginning of the period 1 514 1 466 Net cash flows from operations 2 319 Cash flow from changes in scope of consolidation -25 4 Cash flow from acquisitions and sale of financial
Slide 27: Net contract liabilities by segment (published)
Appendix B: Net contract liabilities by segment (published) Net liabilities Life & P&C In € millions (rounded) +1.8% 23 197 23 615 49% 50% SCOR Global Life SCOR Global P&C 51% 50% 31/12/2013 30/06/2014 27
Slide 28: Calculations of EPS, book value per share and ROE
Appendix C: Calculations of EPS, book value per share and ROE, published Earnings per share calculation In € millions (rounded) H1 2014 H1 2013 Post-tax Return on Equity (ROE) Group net income1) (A) 256 189 Average number of opening shares (1) 192 757 911 192 384 219 In € millions (rounded) H1 2014
Slide 29: Reconciliation of total expenses to cost ratio
Appendix D: Reconciliation of total expenses to cost ratio H1 2013 H1 2013 In € millions (rounded) H1 2014 Pro-forma Published Total expenses as per Profit & Loss account -292 -286 -280 ULAE (Unallocated Loss Adjustment Expenses) -20 -17 -16 Total management expenses -312 -303 -296 Investment manage
Slide 30: Calculation of P&C combined ratio
Appendix E: Calculation of P&C combined ratio In € millions (rounded) H1 2014 H1 2013 Gross earned premiums1) 2 271 2 348 Ceded earned premiums2) -212 -233 Net earned premiums (A) 2 059 2 115 Gross benefits and claims paid -1 325 -1 458 Ceded claims 81 93 Total net claims (B) -1 244 -1 365 Loss rati
Slide 31: Normalized net combined ratio
Appendix E: Normalized net combined ratio QTD YTD 1 2 3 4 5 1+2+3+5 1 2 3 4 5 1+2+3+5 Cat ratio Cat ratio Published delta from Normalized Published delta from Normalized Reserve Reserve combined One off Cat ratio budget (6% combined combined One off Cat ratio budget (6% combined release release rati
Slide 32: SCOR Global P&C renewal definitions
Appendix E: SCOR Global P&C renewal definitions Total premiums up for renewal: premiums of all Treaty contracts incepting in June-July 2013 at the exchange rate as at December 31, 2013 Cancelled/restructured: client or SCOR decided to cancel the business/programs and/or to change their programs
Slide 33: Calculation of the Life technical margin
Appendix F: Calculation of the Life technical margin H1 2013 In € millions (rounded) H1 2014 H1 2013 published pro-forma Gross earned premiums1) 3 012 3 038 2 608 Ceded earned premiums2) -292 -318 -260 Net earned premiums (A) 2 720 2 720 2 348 Net technical result 113 135 108 Interests on deposits 8
Slide 34: 3rd party assets details
Appendix G: 3rd party assets details From Q1 2014 SCOR reports 3rd party assets separately from SCOR’s invested assets. The below table shows the reconciliation with previously disclosed invested asset positions In € millions (rounded) Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 201
Slide 35: Investment portfolio asset allocation as of 30/06/2014
Appendix G: Investment portfolio1) asset allocation as of 30/06/2014 Tactical asset allocation In % (rounded) “Optimal Dynamics” SAA2) 8% 9% 10% 10% 8% 9% Cash 12% 11% 13% 79 % 79% 77% 78% 77% Column2 Fixed Income Min Max 77% 74% 75% 4% 2% 10% 74% 4% 10% 9% 4% 5% Short-term investments 5.0%3) - 5% G
Slide 36: Details of total investment portfolio
Appendix G: Details of total investment portfolio Development of total investments1) since Q2 2012 In € millions (rounded) 23 086 22 954 22 731 21 890 22 194 22 138 22 111 21 591 21 384 8 181 8 192 8 233 8 392 8 266 8 141 8 097 8 379 7 933 13 928 13 997 14 014 14 905 14 539 14 721 13 212 13 498 13 4
Slide 37: Reconciliation of IFRS asset classification to IR presentation
Appendix G: Reconciliation of IFRS asset classification to IR presentation as of 30/06/2014 In € millions (rounded) SGI classification Total Funds Total Fixed Real Other Total Accrued Technical IFRS Cash Loans Equities invested withheld by IFRS income estate investments investments interest items1)
Slide 38: Reconciliation of total insurance business investments to invested assets
Appendix G: Reconciliation of total insurance business investments, cash and cash equivalents to invested assets In € millions (rounded) Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Total insurance business investments, cash and cash 22 026 22 338 22 580 22 462 22 013 22 6
Slide 39: Details of investment returns
Appendix G: Details of investment returns1) In € millions (rounded) QTD 2013 2013 2014 Annualized returns: Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 Total net investment income2)3) 111 120 231 151 127 509 132 149 281 Average investments4) 21 604 21 190 21 397 21 136 22 305 21 559 22 260 22 185 22 223 Return on Inv
Slide 40: Investment income development
Appendix G: Investment income development QTD 2013 2013 2014 In € millions (rounded) Q1 Q2 H1 Q3 Q4 FY Q1 Q2 H1 Investment revenues on invested assets2) 63 91 154 70 79 303 77 88 165 Realized gains/losses on fixed income 40 13 53 11 17 81 9 30 39 Realized gains/losses on loans 0 0 0 0 0 1 1 0 0 Real
Slide 41: Government bond portfolio as of 30/06/2014
Appendix G: Government bond portfolio as of 30/06/2014 By region Top exposures In %. Total € 4.4 billion In € millions (rounded) H1 2014 USA 1 743 UK 633 Canada 351 19% 19% Germany 303 Supranational1) 212 EU (Non-UK) France 211 Japan 163 North America 14% Australia 145 UK Austria 115 Republic of Kor
Slide 42: Corporate bond portfolio as of 30/06/2014
Appendix G: Corporate bond portfolio as of 30/06/2014 By rating By sector/type In %. Total € 4.7 billion 1% 3% In € millions (rounded) H1 2014 In % 9% Consumer, Non-cyclical 1 060 23% 19% AAA Financial 856 18% Communications 518 11% AA Industrial 489 11% 24% A Energy 423 9% Consumer, Cyclical 420 9%
Slide 43: Corporate bond portfolio by seniority
Appendix G: Corporate bond portfolio as of 30/06/2014 By seniority Market to In € millions (rounded) AAA AA A BBB Other1) Total Book Value % Seniority Senior 119 903 2 032 962 327 4 343 102% Subordinated 0 1 11 80 5 96 105% Hybrid 0 0 10 97 103 210 107% Other 0 5 5 2 0 12 98% Total corporate bond po
Slide 44: Financials corporate bond portfolio as of 30/06/2014
Appendix G: “Financials” corporate bond portfolio as of 30/06/2014 By rating In %. Total € 0.9 billion By sector In € millions (rounded) By seniority In %. Total € 0.9 billion <1%1) <1% 12% H1 2014 In % AAA 20% Bank 681 79% 17% Senior AA Real estate 66 8% A Subordinated 25% 11% BBB Insurance 65 8% D
Slide 45: Banks financial corporate bond portfolio as of 30/06/2014
Appendix G: “Banks” financial corporate bond portfolio as of 30/06/2014 By rating By seniority 1) In %. Total € 0.7 billion 12% <1% In %. Total € 0.7 billion 15% AAA 25% AA 13% Senior 22% A Subordinated BBB Hybrid2) <BBB 72% NR 41% By region Top 10 exposures3) In %. Total € 0.7 billion In € millions
Slide 46: Structured & securitized product portfolio as of 30/06/2014
Appendix G: Structured & securitized product portfolio as of 30/06/2014 Market to In € millions (rounded) AAA AA A BBB Other1) Total Book Value % ABS 9 9 2 0 0 20 104% CLO 110 1 0 0 4 115 100% CDO 16 0 32 0 7 55 93% MBS CMO 0 0 1 1 16 19 101% Non-agency CMBS 18 3 0 0 2 23 106% Non-agency RMBS 148 3
Slide 47: Loans portfolio as of 30/06/2014
Appendix G: Loans portfolio as of 30/06/2014 In € millions (rounded) Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Infrastructure loans 0 0 20 49 64 77 Real estate loans 45 47 65 92 88 118 Corporate and leveraged loans1) 201 198 212 244 251 247 Total 246 245 297 385 402 442 1) Corporate and levera
Slide 48: Equity portfolio as of 30/06/2014
Appendix G: Equity portfolio as of 30/06/2014 In € millions (rounded) Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Common shares by underlying asset In % (rounded) Total € 0.3 billion Common shares 457 312 288 264 281 3% 16% 12% Convex 72 75 79 38 36 strategies Convertible 57 71 66 123 130 bonds Preferre
Slide 49: Real estate portfolio as of 30/06/2014
Appendix G: Real estate portfolio as of 30/06/2014 In € millions (rounded) Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Real estate securities and funds 123 121 126 128 127 Direct real estate net of debt and including URGL1) 619 603 612 622 634 Direct real estate at amortized cost 784 765 758 757 753 Rea
Slide 50: Other investments as of 30/06/2014
Appendix G: Other investments as of 30/06/2014 In € millions (rounded) Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Alternative investments 120 113 109 109 107 Non-listed equities 62 62 67 67 65 Commodities 24 25 0 0 0 Infrastructure funds 45 45 47 47 47 Private equity funds 12 13 13 13 15 Insurance Link
Slide 51: Unrealized gains & losses development
Appendix G: Unrealized gains & losses development In € millions Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Variance YTD (rounded) Fixed income1) 21 52 9 95 172 163 Loans1) 5 0 1 1 0 -1 Equities -1 23 35 29 38 3 Real estate2) 103 100 110 115 118 7 Other investments 1 5 6 8 7 1 Total 129 181 162 248 334
Slide 52: Reconciliation of asset revaluation reserve
Appendix G: Reconciliation of asset revaluation reserve In € millions (rounded) 31/12/2013 30/06/2014 Variance YTD Fixed income URGL 9 172 163 Of which: Government bonds & assimilated1) -52 8 60 Covered & agency MBS 3 42 39 Corporate bonds 59 122 63 Structured & securitized products -2 0 1 Loans 1 0
Slide 53: Debt structure as of 30/06/2014
Appendix H: Debt structure as of 30/06/2014 Original Current amount Floating/ Type amount outstanding (book Issue date Maturity Coupon + step-up fixed rate issued value) Subordinated US $ 100 30 years First 10 years: 3-month Libor rate floating rate notes US $ 21 million 7 June 1999 Floating million
Slide 54: SCOR's rating has improved dramatically since 2005
Appendix I: SCOR’s rating has improved dramatically since 2005 Evolution of SCOR’s S&P rating Evolution of SCOR’s Moody’s rating A+ + A1 Strong Strong A + A2 + A- + A3 + Secure Secure + Baa1 + BBB+ A+ A1 Good Good BBB Baa2 + Positive Outlook Stable Outlook BBB- Baa3 2005 2006 2007 2008 2009 2010 201
Slide 55: SCOR's listing information
Appendix J: SCOR’s listing information Euronext Paris listing SIX Swiss Exchange listing ADR programme SCOR’s shares are publicly traded SCOR’s shares are publicly traded SCOR’s ADR shares trade on the on the Eurolist by the Euronext on the SIX Swiss Exchange OTC market Paris stock market (formerly
Slide 56: Strategy recognized by industry experts
Appendix K: The strength of the SCOR group’s strategy is recognized by industry experts 2011 2012 2013 2014 SCOR Global P&C: best SCOR: “Reinsurance reinsurance company SCOR: “Reinsurance Company CEO team for Motor and Company of the Year“ Denis Kessler : “Insurance Hall of Fame of the Year“ Faculta