Vienna Insurance Group AG · VIE:VIG
Vienna Insurance — 9M 2020 Earnings Presentation
50 slides from Vienna Insurance's earnings presentation, Feb 9, 2021
Slide 1: Investor Presentation 9M 2020 results
VIENNA INSURANCE GROUP Investor Presentation 9M 2020 results
Slide 2: We are the leading insurance group in Austria & CEE
WE ARE THE LEADING INSURANCE GROUP IN AUSTRIA & CEE Represented in More than 50 group companies 30 25,000 markets employees More than S&P Rating Solvency Ratio 6M 2020 50% of premiums and profits coming A+ 183% with stable outlook based on Partial Internal Model from CEE Since Market capitalization
Slide 3: Business profile and strategy
BUSINESS PROFILE AND STRATEGY VIG Group characterised by solid business profile and strong balance sheet Proven Well Agenda 2020 business diversified initiatives to drive model portfolio over profitability in countries and many lines of lines of business, business especially in motor also in 2020 St
Slide 4: Acquisition of Aegon business in CEE
ACQUISITION OF AEGON BUSINESS IN CEE Purchase price of € 830 million ▪ Share purchase agreement signed on 29 November 2020 ▪ Acquisition of non-life and life insurance companies, pension funds, asset management and service companies in Hungary, Poland, Romania and Turkey ▪ Expansion of VIG’s leading
Slide 5: Group history
GROUP HISTORY Long-term experience in organic growth and M&A 1824 1990 1996 1999 2001/2002 2004 2006 2007 2008 2010 2011 2014 2019 AT CZ, SK HU, PL, IT, LI, HR RO, BY SI GE TR, AL EE, LV ME BA MD Nordics DE BG, RS UA MK LT (industrial business) While maintaining management principles… …we refine the
Slide 6: Best positioned in Austria and CEE
BEST POSITIONED IN AUSTRIA AND CEE Excellent market positions throughout the region Close to our customers in 30 markets Country Market position Austria 1 1 1 1 Czech Rep. 1 2 1 Slovakia 1 2 1 10 Poland 4 4 5 4 Romania 1 2 2 1 Baltic States 1 1 3 3 1 Hungary 6 6 4 1 6 4 Bulgaria 1 11 1 2 1 4 4 total
Slide 7: Long-term growth potential
LONG-TERM GROWTH POTENTIAL Annual insurance spending shows growth potential in Austria and CEE Insurance density 2019, in EUR (premiums per capita) 1,951 Ø EU-15*: ~€2,900 Ø CEE-VIG*: ~€200 1,211 576 413 374 369 365 344 342 296 213 151 131 120 104 104 83 63 50 50 50 43 23 North Macedonia Turkey Hung
Slide 8: High uncertainty regarding global outlook due to COVID-19
HIGH UNCERTAINTY REGARDING GLOBAL OUTLOOK DUE TO COVID-19 Based on their past, CEE markets better in dealing with crisis situation 105% Real GDP development expectations 2019 - 2021 • Global economy is projected to contract HU worse than during the financial crisis CZ 2008/2009 100% PL • In the shor
Slide 9: Successful bancassurance
SUCCESSFUL BANCASSURANCE Premium growth despite COVID-19 ▪ Total premium volume generated in 9M 2020: €991mn (+1.0%) ▪ Premium growth in all lines of business ▪ Integral part of Agenda 2020 CZ ▪ Focus on increasing sale of P&C and health business via banks SK ▪ Successful cooperation in 11 countries
Slide 10: ESG at VIG Group
ESG AT VIG GROUP Environmental, social and governance initiatives throughout the Group ▪ VIG share is listed in the international sustainability index FTSE4Good and the Austrian VÖNIX ▪ Annual CSR meetings to promote best practise sharing and the exchange of individual Group initiatives ▪ VIG Group
Slide 11: VIG Group climate change strategy
VIG GROUP CLIMATE CHANGE STRATEGY Published in May 2019 Binding regulations for Group companies regarding investments and underwriting in coal power energy ▪ Support of green investments and a low-carbon future: ▪ Consciously increasing the share of green investments (e.g. green bonds, environmental
Slide 12: Outlook FY 2020
OUTLOOK FY 2020 Persisting macroeconomic uncertainties ▪ Managing Board of Vienna Insurance Group expects profit before taxes for the full year 2020 to be in a range of EUR 300 - 350 million ▪ VIG will stick to its dividend policy, foreseeing a distribution in the range of 30 to 50% of Group net pro
Slide 13: Strategy, Results 9M 2020, Segments, Appendix
STRATEGY RESULTS 9M 2020 SEGMENTS APPENDIX 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). Rounding differences may occur when rounded amounts or percentages are ad
Slide 14: Highlights 9M 2020
HIGHLIGHTS 9M 2020 Solid business performance in unprecedented times Gross written premiums Profit before taxes Combined Ratio € 7,986.4mn € 266.3mn 96.1% GWP up by 1.7% (+€135.2mn) PBT down by 29.2% (-€109.9mn) Improved by 0.3%p due to decreased claims ratio ▪ Strongest contribution by segments ▪ A
Slide 15: Main market developments
Baltic MAIN MARKET DEVELOPMENTS states No. of companies: 3 Overview 9M 2020 Employees: 1.944 Market share: ~24% GWP: €368mn (-0.8%) Czech Republic PBT: €10mn (+66.2%) CoR: 96.7% (-0.7%p) No. of companies: 3 EE Employees: 4.889 Market share: ~31% Poland LV GWP: €1.297mn (-0.9%) PBT: €153mn (+24.9%) L
Slide 16: 9M 2020 key financials
9M 2020 KEY FINANCIALS Overview of KPIs Net result for the period after taxes and ROE before taxes and non-controlling interest (€mn) non-controlling interest (%) EPS net of hybrid interest* (€) 227 10.3 2.36 207 175 8.5 8.1 2.04 1.82 9M 18 9M 19 9M 20 9M 18 9M 19 9M 20 9M 18 9M 19 9M 20 * Based on
Slide 17: Profit development impacted by financial result decrease
PROFIT DEVELOPMENT IMPACTED BY FINANCIAL RESULT DECREASE 9M 2020 Income statement €mn 9M 2020 9M 2019 +/- % Gross premiums written 7,986.4 7,851.2 1.7 ▪ Premium growth driven by other property (+€192.3mn) and health (+€9.3mn) Net earned premiums 7,024.5 6,925.9 1.4 Financial result* 512.8 627.0 -18.
Slide 18: Overall premium growth of 1.7%
OVERALL PREMIUM GROWTH OF 1.7% Overview by segments Gross written premiums (€mn; y-o-y change) ▪ Top line up by €135.2mn to €8.0bn despite declining life business ▪ Premium increases driven by growth in Central Functions (+€96mn), Austria (+€88mn) and Poland (+€55mn) ▪ Strong development in Other Pr
Slide 19: Premium growth in 9M 2020 supported by strong Q1
PREMIUM GROWTH IN 9M 2020 SUPPORTED BY STRONG Q1 Gross written premiums by lines of business (€mn; y-o-y change); incl. Central Functions MTPL Casco Other property Total premiums +1.7% 9M 2019 1,142 967 3,622 7,851 7,986 +0.5% +0.5% +5.3% MTPL 1,142 1,148 9M 2020 1,148 972 3,814 972 Casco 967 Other
Slide 20: Group profit before taxes of €266.3mn down by 29.2%
GROUP PROFIT BEFORE TAXES OF €266.3MN DOWN BY 29.2% Positive PBT development (+2.1%) excluding ~€118mn goodwill impairments in Q2 2020 Result before taxes (€mn; y-o-y change) ▪ Adjusted for goodwill impairments, double-digit growth rates in Bulgaria, Turkey/Georgia and Remaining CEE ▪ AT: profit dec
Slide 21: Combined ratio (P&C) at 96.1%
COMBINED RATIO (P&C) AT 96.1% Improved CoR in all market segments, except for Austria and Poland P&C Combined Ratio development Overview by segments (y-o-y development net, %) ▪ Claims ratio decrease compared to 9M 2019 impacted by +0.9%p -1.8%p -7.4%p +0.2%p -4.2%p -0.7%p better claims activity 103
Slide 22: Investment split and bond portfolio overview
INVESTMENT SPLIT AND BOND PORTFOLIO OVERVIEW Overall investment strategy unchanged, certain industries to be reevaluated 9M 2020: Total €36.1bn Bond portfolio by rating1 in % 3.7% 1.5% 7.8% AAA AA A BBB Other 9M 2020 9.4 30.2 35.6 20.7 4.1 7.2% 12M 2019 9.0 31.0 36.8 19.1 4.1 7.0% 72.8% Bond portfol
Slide 23: Financial result
FINANCIAL RESULT Increased investment impairments in Q3 in accordance with longstanding impairment rules at VIG €mn 9M 2020 9M 2019 +/- % Current income 721,135 967,004 -25.4 ▪ Change of consolidation method of non-profit housing societies Income from appreciations 13,306 24,899 -46.6 affects curren
Slide 24: Strategy, Results 9M 2020, Segments, Appendix
STRATEGY RESULTS 9M 2020 SEGMENTS APPENDIX 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). Rounding differences may occur when rounded amounts or percentages are ad
Slide 25: Austria
AUSTRIA PBT decrease driven by lower financial result GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +2.8% Gross premiums written 3,193.8 3,106.2 2.8 ▪ Premium growth of €87.6mn driven by 3,194 Net earned premiums 2,486.4 2,441.6 1.8 other property (+€47.4mn), life single 3,106 Financial result* 41
Slide 26: Czech Republic
CZECH REPUBLIC Profit growth driven by improved CoR and better technical result in life GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -0.9% Gross premiums written 1,297.0 1,308.5 -0.9 ▪ Slightly weaker premium development 1,309 Net earned premiums 973.2 992.6 -2.0 (-€11.5mn) due to FX-effects (+1.
Slide 27: Slovakia
SLOVAKIA Strong P&C development GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -7.0% Gross premiums written 557.6 599.3 -7.0 ▪ Premium declines (-€41.7mn) mainly 599 Net earned premiums 451.2 498.5 -9.5 resulting from life business 558 Financial result 29.9 37.2 -19.8 114 Other income 3.1 19.8 -84.
Slide 28: Poland
POLAND Solid insurance business performance GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +6.6% Gross premiums written 889.1 834.1 6.6 ▪ Premium growth of €55.0mn driven 889 Net earned premiums 689.7 652.3 5.7 mainly by other property (+€33.5mn) 834 Financial result 29.0 27.6 5.0 and MTPL (+€17.7m
Slide 29: Romania
ROMANIA Improved motor business drives premium and profit growth GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +3.7% Gross premiums written 354.8 342.1 3.7 ▪ Premium growth of +€12.7mn coming 355 Net earned premiums 274.3 260.2 5.4 from casco (+€12.6mn), other property 342 Financial result 16.1 12
Slide 30: Baltic states
BALTIC STATES PBT growth based on CoR improvement and strong health business GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -0.8% Gross premiums written 367.7 370.6 -0.8 ▪ Slight premium decrease of €2.9mn; 371 Net earned premiums 292.1 286.4 2.0 double-digit growth rates in life and 368 Financial
Slide 31: Hungary
HUNGARY FX adjusted PBT growth of ~5% GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +4.1% Gross premiums written 212.9 204.5 4.1 ▪ Premium growth of €8.4mn with 213 Net earned premiums 160.3 147.2 8.9 strongest contribution of life single 205 Financial result 2.6 4.1 -36.4 premium business (+€13.2
Slide 32: Bulgaria
BULGARIA Goodwill impairment in Q2 2020 weighs on profits GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -10.2% Gross premiums written 155.0 172.6 -10.2 ▪ Premium decrease of €17.6mn mainly 173 Net earned premiums 111.1 104.6 6.2 due to decreased health (-€17.9mn) Financial result 9.9 9.2 6.8 and M
Slide 33: Turkey/Georgia
TURKEY/GEORGIA Goodwill impairment in Georgia in Q2 in the size of ~€13mn GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +10.4% Gross premiums written 178.4 161.7 10.4 ▪ Premiums up by €16.7mn with other 178 Net earned premiums 87.8 82.5 6.4 property growing by +€13.8mn and Financial result 6.6 9.0
Slide 34: Remaining CEE
REMAINING CEE Profit development impacted by goodwill impairment in Croatia in Q2 2020 GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -0.8% Gross premiums written 333.4 336.1 -0.8 ▪ Remaining CEE: Albania (incl. Kosovo), 336 Net earned premiums 239.4 244.8 -2.2 Bosnia-Herzegovina, Croatia, Moldova,
Slide 35: Other markets
OTHER MARKETS Germany and Liechtenstein GWP development (€mn) €mn 9M 2020 9M 2019 +/- % -8.7% Gross premiums written 208.5 228.2 -8.7 ▪ Premiums down by €19.7mn due to 228 Net earned premiums 173.2 193.8 -10.6 negative development in the life single Financial result 12.4 14.3 -13.6 premium business
Slide 36: Central Functions
CENTRAL FUNCTIONS Lower financial result related to the consolidation change of the Austrian housing societies GWP development (€mn) €mn 9M 2020 9M 2019 +/- % +7.7% Gross premiums written 1,343.0 1,247.2 7.7 ▪ Central Functions include VIG Holding, 1,343 Net earned premiums 1,073.7 1,018.6 5.4 VIG R
Slide 37: Appendix
STRATEGY RESULTS 9M 2020 SEGMENTS APPENDIX 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). Rounding differences may occur when rounded amounts or percentages are ad
Slide 38: Managing Board of Vienna Insurance Group
MANAGING BOARD OF VIENNA INSURANCE GROUP As of 1 January 2021 Elisabeth Stadler, CEO Liane Hirner, CFO Peter Höfinger Gerhard Lahner Gabor Lehel Hartwig Löger Harald Riener Peter Thirring Credit: Ian Ehm 38 APPENDIX VIG VIENNA INSURANCE GROUP
Slide 39: VIG Fund - real estate investment focused on CEE
VIG FUND - REAL ESTATE INVESTMENT FOCUSED ON CEE VIG Fund reached market value of more than EUR 400mn VIG Holding successfully built up a diversified real estate portfolio with top properties in CEE markets ▪ Entity fully managed by VIG Holding ▪ Strategy and investment decisions “inhouse” Key Facts
Slide 40: S&P rating confirmed in November 2020
S&P RATING CONFIRMED IN NOVEMBER 2020 VIG remains best-rated company in the ATX Financial Risk Profile: Business Business Risk Financial Risk Profile: Profile: Very Strong Strong Strong Very Strong ▪ Excellent capitalization in 2019 ▪ “Market leading position in Austria and the Central and Eastern E
Slide 41: 9M 2020 balance sheet
9M 2020 BALANCE SHEET IFRS (€mn) €mn 30.09.2020 31.12.2019 +/- % Intangible assets (incl. Right-of-Use Assets) 1,952 2,137 -8.7 Investments 34,566 34,456 0.3 Unit- and index-linked investments 7,604 8,620 -11.8 Reinsurers’ share in underwriting provisions 1,280 1,283 -0.3 Receivables 1,624 1,717 -5.
Slide 42: Equity development
EQUITY DEVELOPMENT Dividend payout in Q3 2020 Change in consolidated Shareholders’ Equity (€mn) -3% 183 -152 -21 5,191 5,058 -153 10 Equity as Profit for Currency AFS unrealised Dividend Other Equity as of 12M19 the period changes gains and losses payment of 9M20 42 APPENDIX VIG VIENNA INSURANCE GRO
Slide 43: 9M 2020 premiums by business lines and country (I)
9M 2020 PREMIUMS BY BUSINESS LINES AND COUNTRY (I) IFRS (€mn) MTPL Casco Other property 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % Austria 262.1 259.0 1.2 240.2 235.1 2.2 1,197.5 1,150.1 4.1 Czech Republic 234.7 229.8 2.2 182.9 185.0 -1.2 365.7 369.9 -1.1 Slovakia 112.7 114.0
Slide 44: 9M 2020 premiums by business lines and country (II)
9M 2020 PREMIUMS BY BUSINESS LINES AND COUNTRY (II) IFRS (€mn) Life regular Life single Health 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % Austria 915.2 930.5 -1.7 242.8 209.4 15.9 336.1 322.1 4.4 Czech Republic 474.1 476.8 -0.6 25.9 34.7 -25.4 13.6 12.3 10.8 Slovakia 126.7 137
Slide 45: 9M 2020 country overview GWP / PBT / combined ratio
9M 2020 COUNTRY OVERVIEW GWP / PBT / COMBINED RATIO IFRS (€mn) GWP Total Result before Taxes Combined Ratio net (in %) 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % 9M 2020 9M 2019 +/- % Austria 3,193.8 3,106.2 2.8 122.6 141.8 -13.5 95.0% 94.1% 0.9 Czech Republic 1,297.0 1,308.5 -0.9 152.7 122.3 24.9
Slide 46: VIG share (I)
VIG SHARE (I) Number of common shares: 128,000,000 / ISIN: AT0000908504 General information Analyst recommendations (31 Dec 2020) Current listings Ticker Rating Major Indices Vienna ▪ Vienna Stock Exchange: VIG Standard & Poor´s: ATX BUY Prague ▪ Bloomberg: VIG AV / VIG CP A+, stable outlook ATX Pri
Slide 47: VIG share (II)
VIG SHARE (II) Shareholder structure Free float split by region1 North America 35% Continental Europe 25% ~72% ~28% Austria 24% UK & Ireland 13% Other 3% Wiener Städtische Versicherungsverein Free Float (Mutual) 1: Split of identified shares, May 2020 (Source: Investor Update) 47 APPENDIX VIG VIENNA
Slide 48: Appendix
48 APPENDIX VIG VIENNA INSURANCE GROUP
Slide 49: Contact details / financial calendar
CONTACT DETAILS / FINANCIAL CALENDAR Investor Relations / investor.relations@vig.com / www.vig.com Nina Higatzberger-Schwarz Sylvia Machherndl Financial calendar 2021* Tel. +43 (0)50 390 – 21920 Tel. +43 (0) 50 390 – 21151 Date Event nina.higatzberger@vig.com sylvia.machherndl@vig.com 09 Mar. 2021 P
Slide 50: 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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