Tryg A/s · OMXCOP:TRYG
Tryg A/s — Q2 2015 Earnings Presentation
22 slides from Tryg A/s's earnings presentation, Jul 10, 2015
Slide 1: Q2 and H1 2015 results
Q2 and H1 2015 results Webcast presentation Follow us on Twitter: @TrygIR 10 July 2015
Slide 2: Disclaimer
Disclaimer Certain statements in this presentation are based on the beliefs of our management as well as assumptions made by and information currently available to the management. Forward-looking statements (other than statements of historical fact) regarding our future results of operations, financ
Slide 3: H1 2015 highlights
H1 2015 highlights Key focus areas Current initiatives Efficiency programme proceeds as • Building initiatives ensuring a greater effect from planned. Expected lower run-rate in 2015 efficiency programme of DKK 225m in 2016 and of DKK 150m compared to DKK 396m in DKK 375m in 2017 2014. • Balance p
Slide 4: Financial highlights Q2 2015
Financial highlights Q2 2015 - Tryg delivered a robust ROE of 21.9% despite a negative investment market, and pays out a semi-annual dividend of DKK 2.50. Satisfactory technical result with an underlying improvement in a competitive market. Pre-tax profit (DKKm) • Pre-tax result of DKK 714m (DKK 1,1
Slide 5: Customer highlights Q2 2015
Customer highlights Q2 2015 - Continued improvement in Net Promoter Score (NPS) • New price-differentiated products launched: • Personal accident insurance in both Denmark and Norway • Holiday home insurance in Norway NPS • Change of car ownership insurance in Denmark 22 20 • The new car insurance l
Slide 6: Premiums and portfolio
Premiums and portfolio
Slide 7: Gross earned premiums reduced by 1.4%
Gross earned premiums reduced by 1.4% Gross earned premiums reduced 1.4% (-1.2%) related to: • Private impacted by the competitive situation. Retention was stable in Denmark but decreased slightly in Norway • Commercial Norway impacted by a weaker economic situation and the competitive situation • C
Slide 8: Customer retention
Customer retention Private 92% DK • High and stable customer 90% retention in Denmark 88% 86% • Slight decrease in Norway NO 84% 82% Commercial • Customer retention stable 92% in Denmark 90% NO 88% • Retention decreased in Norway 86% DK impacted by changed 84% distribution set-up and competition 82%
Slide 9: Private - average premiums
Private - average premiums - DK profitability strong but competition increasing House insurance – average premium (index 2011 = 100) Average premiums increase Y/Y NO • NO: price increases from July 115 -0.8% 1.1% (Q1 -0.8%) (Q1 1.4%) 110 • DK: changed selection reduces 105 DK average price 100 95 90
Slide 10: Slight increase in technical result
Slight increase in technical result Group (DKKm) Private, DK & NO (DKKm) Commercial, DK & NO (DKKm) 494 224 941 75 46 825 135 434 419 220 178 Q2 2015 Q2 2014 Q2 2015 Q2 2014 806 Corporate (DKKm) Sweden (DKKm) 180 19 43 161 99 72 50 -5 Q2 2015 Q2 2014 Q2 2015 Q2 2014 Q2 2015 Q2 2014 One-off effects 1
Slide 11: Combined ratio improved by 1.3 pp.
Combined ratio improved by 1.3 pp. Group Private, DK & NO Commercial, DK & NO 83.5 82.1 80.7 3.3 78.1 4.4 78.8 79.1 Q2 2015 Q2 2014 Q2 2015 Q2 2014 83.5 82.2 2.8 Corporate Sweden 80.7 90.3 87.0 84.7 1.8 78.9 88.6 82.9 -1.6 Q2 2015 Q2 2014 Q2 2015 Q2 2014 Q2 2015 Q2 2014 One-off effects 11
Slide 12: Efficiency programme, DKK 38m achieved in Q2
Efficiency programme, DKK 38m achieved in Q2 • Programme delivering as planned with Efficiency programme up until 2017 (DKKm) target to achieve savings of DKK 750m in Old programme New programme the next 3 years. • Lower expected 2015 savings than in 2014. 388 395 375 • Claims initiatives: 225 175 •
Slide 13: Expense ratio improved from 15.4 to 15.2
Expense ratio improved from 15.4 to 15.2 • Expense ratio improved from 15.4 in Q2 2014 to Expense ratio 15.2 in Q2 2015 – (adjusted for one-off effects in Q2 2014). • 2015 will be impacted by one-off costs related 16.6 16.4 to new efficiency programme. 15.6 15.4 * 14.6 15.2 • Efficiency programme de
Slide 14: Claims
Claims
Slide 15: Improved underlying claims ratio
Improved underlying claims ratio Group Private (DK & NO) Commercial (DK & NO) 68.3 68.8 63.6 62.8 70.0 69.5 Q2 2015 Q2 2014 Q2 2015 Q2 2014 Corporate Sweden 79.3 76.5 75.6 72.8 Q2 2015 Q2 2014 Q2 2015 Q2 2014 Q2 2015 Q2 2014 Underlying development is adjusted for large claims, weather claims, run-of
Slide 16: Large claims, weather claims and run-off
Large claims, weather claims and run-off Large claims, net DKKm Expected annual Weather claims, net DKKm Expected annual level 2015: DKK 550m level 2015: DKK 500m 721 574 620 546 471 407 447 356 127 78 60 23 2011 2012 2013 2014 Q2 2014 Q2 2015 2011 2012 2013 2014 Q2 2014 Q2 2015 Claims reserves disc
Slide 17: Investment, capital and targets
Investment, capital and targets
Slide 18: Investment return – loss on bonds
Investment return – loss on bonds Investment return Free portfolio return (%) DKKm Q2 2015 Q2 2014 1.1 1.1 0.0 0.3 Free portfolio 41 244 -0.1 -1.2 Match regulatory -44 49 deviation Match performance -11 50 Other financials -70 -84 Geographical exposure (%) Total return -84 259 100 99 68 52 Portfolio
Slide 19: Capital structure
Capital structure Capital – Q2 2015, DKKm • Capital buffer based on Individual Solvency decreased to 51% (Q1 2015: 55%) and was impacted by: • Result Q2 2015 Excess capital • Executed share buy back of 2015 and H1 cash dividend 2015 3,400 Buffer • Based on Solvency II standard model the capital 6,69
Slide 20: Concluding remarks
Concluding remarks Efficiency programme proceeds as Price-differentiation and customer life time planned. Expected lower run-rate in 2015 value of DKK 150m compared to DKK 396m in 2014. Topline development challenging Increased customer focus Leading Scandinavian insurer with strong track re
Slide 21: Q&A
Q&A Follow us on Twitter: @TrygIR
Slide 22: Upcoming roadshows
Upcoming roadshows Date Place Participants from Tryg Arranged by Morten Hübbe, CEO Tor Magne Lønnum, CFO 10/07/2015 Copenhagen Jyske Markets Lars Bonde, Group EVP and COO Investor Relations Morten Hübbe, CEO 13/07/2015 London Tor Magne Lønnum, CFO Danske Markets Investor Relations Tor Magne Lønnum,