Vienna Insurance Group AG · VIE:VIG

Vienna Insurance — 9M 2019 Earnings Presentation

48 slides from Vienna Insurance's earnings presentation, Dec 3, 2019

  1. Slide 1: Investor Presentation 9M 2019 Results

    VIENNA INSURANCE GROUP Investor Presentation 9M 2019 Results

  2. Slide 2: VIG – The Leading Insurance Group in Austria & CEE

    VIG – THE LEADING INSURANCE GROUP IN AUSTRIA & CEE Close to Around Represented in 200 years of experience 50 Group companies 25 markets More than More than Solvency Ratio HY 2019 50% of premiums and profits coming 25,000 employees 238% based on Partial Internal Model from CEE Since Current market ca

  3. Slide 3: Management Principles

    MANAGEMENT PRINCIPLES 1 Local entrepreneurship  Knowledge of local needs and markets  Decentralised structures and efficient decision-making procedures 2 Multi-brand strategy  Around 50 brands in 25 countries  Utilisation of established local brands 3 Multi-channel distribution  Various distrib

  4. Slide 4: VIG Best Positioned to Leverage Positive Market Development in CEE

    VIG IS BEST POSITIONED TO LEVERAGE ON THE POSITIVE MARKET DEVELOPMENT IN CEE Excellent market shares throughout the region 1 2018: 25 markets Client/talent base: 180mn people Country Market position Market share total 10 Austria 1 1 1 24.7% 4 Czech Rep. 1 2 1 31.9% Slovakia 1 2 1 32.8% 1 2 Poland 4

  5. Slide 5: CEE Region Growing Stronger than EU-15

    CEE REGION GROWING STRONGER THAN EU-15 Promising GDP per capita growth 2019 - 2023 Gap in GDP growth in purchasing parities CEE vs. EU-15 Forecast CAGR 8% 2019-2023 real GDP 6% 2.7% (CEE) vs. 4% 1.5% (EU-15) 2% 0% 2000 2003 2006 2009 2012 2015 2018 2021 -2% -4% real GDP growth PPP (USD) CEE real GDP

  6. Slide 6: Long-Term Growth Potential

    LONG-TERM GROWTH POTENTIAL Annual insurance spending shows growth potential in Austria and CEE Insurance density 2017, in EUR (premiums per capita) Ø CEE-VIG: EUR 174 2,726 1,949 524 397 371 326 315 290 274 239 157 132 130 109 108 100 70 52 41 40 32 17 Hungary Turkey Romania Albania Lithuania Bosnia

  7. Slide 7: Agenda 2020: Creating Added Value and Contribution to Future Success

    AGENDA 2020 CREATING ADDED VALUE AND CONTRIBUTION TO FUTURE SUCCESS Optimisation of business model Ensuring future growth  Shared Services  Use of growth potentials Creating cost benefits by merging back-office functions Intensify selected business areas  e.g. health and companies insurance, rein

  8. Slide 8: Agenda 2020 Review After Half Time

    AGENDA 2020 Review after half time Ensuring future growth Optimisation of business model Use of growth potentials Digitalisation Anti-Fraud-Management Health insurance  >150 ongoing digitalisation projects  Roll-out in 13 companies in 10 countries 58% premium increase in the 5 key countries of BG,

  9. Slide 9: Bancassurance

    BANCASSURANCE Pilot projects contribute to growth especially in non-life business  Integral part of Agenda 2020  Focus on increasing sale of P&C and health business via banks  Successful cooperation in 11 countries CZ SK  Total premium volume as of 9M 2019: ~€980mn (+9%) AT HU  Life: +8%, Non-L

  10. Slide 10: Summary & Cornerstones of VIG's Equity Story

    SUMMARY & CORNERSTONES OF VIG’S EQUITY STORY INVEST IN GROWTH INVEST IN RELIABILITY INVEST IN VISION INVEST IN RESPONSIBILITY  25 markets, primarily in the  Sustainable dividend policy  Targeted use of technology in  High commitment to linking CEE region distribution, product design and financia

  11. Slide 11: Results 9M 2019

    STRATEGY & OUTLOOK RESULTS 9M 2019 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 percenta

  12. Slide 12: Highlights 9M 2019

    HIGHLIGHTS 9M 2019 On track to meet 2019 targets despite deconsolidation of non-profit housing societies Gross written premiums Profit before taxes Combined Ratio € 7,851.2mn € 376.2mn 96.4% GWP up by 6.7% (+€494mn) PBT increased by 6.8% (+€24mn) CoR stable (9M 2018: 96.3%)  Strongest contribution

  13. Slide 13: Result Up by 6.8% Despite Lower Financial Result

    RESULT UP BY 6.8% DESPITE LOWER FINANCIAL RESULT 9M 2019 Income statement €mn 9M 2019 9M 2018 +/- % Gross premiums written 7 851.2 7 357.5 6.7 Net earned premiums 6 925.9 6 518.1 6.3 Financial result1 627.0 795.9 -21.2  Financial result (incl. at equity consolidated companies) down Other income 134

  14. Slide 14: Strong Top-Line Growth: GWP of €7.9bn Up by 6.7%

    STRONG TOP-LINE GROWTH GROSS WRITTEN PREMIUMS OF €7.9BN UP BY 6.7% Overview by segments Gross written premiums (€mn; y-o-y chg.)  CEE growth of 9.3%; excl. consolidation effects 5.1%  Premium growth drivers are Austria (+€110mn), Poland (+€165mn) and the Baltics (+€91mn) - incl. first-time consoli

  15. Slide 15: Consistent Growth in All Lines of Business

    CONSISTENT GROWTH IN ALL LINES OF BUSINESS; DOUBLE-DIGIT GROWTH IN OTHER PROPERTY & HEALTH Gross written premiums by lines of business (€mn; y-o-y chg.); incl. Central Functions MTPL Casco Other property Total premiums +6.7% 9M 2018 1,099 880 3,290 7,851 +3.9% +9.9% +10.1% 7,357 1,142 9M 2019 1,142

  16. Slide 16: Group Profit Before Taxes of €376.2mn Up by 6.8%

    GROUP PROFIT BEFORE TAXES OF €376.2MN UP BY 6.8% Solid profit growth in all market segments with Czech Republic remaining stable Result before taxes (€mn; y-o-y change)  AT: €12mn profit growth; positive developments in P&C, life and health  CZ: €1.6mn decrease driven by lower financial result and

  17. Slide 17: Combined Ratio (P&C) at 96.4%

    COMBINED RATIO (P&C) AT 96.4% AFTER 96.3% IN 9M 2018 Several NatCat events in 9M 2019 P&C Combined Ratio development Overview by segments (9M y-o-y development net, %)  AT: Improvement supported by Donau Versicherung -3.1%p -0.8%p +1.1%p +0.5%p +1.8%p -2.4%p  CZ: CoR up due to higher claims ratio

  18. Slide 18: Financial Result Decreased by 19.8%

    FINANCIAL RESULT DECREASED BY 19.8% Current income slightly down by 2.8% due to deconsolidation of non-profit societies Total TEUR 9M 2019 9M 2018 +/- % Current income 967 004 994 507 -2.8  Financial result down by €149.6mn excl. at equity Income from appreciations 24 899 7 137 >100 consolidated co

  19. Slide 19: Investment Split and Bond Portfolio Overview

    INVESTMENT SPLIT AND BOND PORTFOLIO OVERVIEW Change in investment split due to deconsolidation of non-profit housing societies 9M 2019: Total €35.8bn Bond portfolio by rating1 in % 4.6% 1.6% 7.0% AAA AA A BBB Other 9M 2019 9.2 31.2 36.7 18.5 4.4 6.7% 12M 2018 9.9 32.1 35.3 17.1 5.6 6.3% 73.8% Bond p

  20. Slide 20: VIG Well on Track to Reach Its Targets

    VIG WELL ON TRACK TO REACH ITS TARGETS Executive summary Highlights 2019 VIG climate change strategy 2019  Binding regulations for all Group companies regarding investing and underwriting in the coal power energy sector  Direct investments will be reduced to less than 50% by 2025 and to zero by 20

  21. Slide 21: Segments

    STRATEGY & OUTLOOK RESULTS 9M 2019 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 percenta

  22. Slide 22: Austria

    AUSTRIA CoR improved to solid 94.1% GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +3.7% Gross premiums written 3 106.2 2 996.4 3.7  Financial result decreased by €96.2mn 3,106 Net earned premiums 2 441.6 2 364.5 3.3 impacted mainly by non-recurring one-offs 2,996 Financial result1 480.7 576.9 -16

  23. Slide 23: Czech Republic

    CZECH REPUBLIC Despite a substantially lower financial result, profit development stable GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +2.7% Gross premiums written 1 308.5 1 274.4 2.7  Premiums up by €34.1mn driven by life 1,309 Net earned premiums 992.6 955.7 3.9 regular business and motor lines

  24. Slide 24: Slovakia

    SLOVAKIA Life growth fully compensates for declining P&C development GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +1.3% Gross premiums written 599.3 591.7 1.3  Premium increase of €7.6mn due to 599 Net earned premiums 498.5 490.0 1.7 growth in life 592 Financial result 37.2 38.3 -2.8 Other incom

  25. Slide 25: Poland

    POLAND Ongoing strong performance GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +24.7% Gross premiums written 834.1 668.7 24.7  Premium growth of €165.4mn driven by 834 Net earned premiums 652.3 508.6 28.2 other property (+€96.4mn) and motor Financial result 27.6 19.2 44.2 (+€70.8mn); start of co

  26. Slide 26: Romania

    ROMANIA Challenging environment GWP development (€mn) €mn 9M 2019 9M 2018 +/- % -12.9% Gross premiums written 342.1 392.9 -12.9  Premiums down by €50.8mn driven by Net earned premiums 260.2 294.2 -11.5 further intentional decrease of the MTPL 393 Financial result business (-€65.8mn) 12.5 9.7 29.0 3

  27. Slide 27: Baltic States

    BALTIC STATES First-time consolidation of Seesam Insurance GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +32.7% Gross premiums written 370.6 279.2 32.7  Double-digit premium growth in all lines of 371 Net earned premiums 286.4 202.1 41.7 business Financial result 7.6 4.1 87.5 Other income 2.6 0.9

  28. Slide 28: Hungary

    HUNGARY Continued growth of top- and bottom-line GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +7.0% Gross premiums written 204.5 191.1 7.0  Premium growth mainly driven by MTPL 205 Net earned premiums 147.2 143.5 2.6 (+€13.4mn) and other property (+€7.5mn) 191 Financial result 4.1 4.8 -14.9 35 O

  29. Slide 29: Bulgaria

    BULGARIA Double-digit premium and profit growth GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +33.2% Gross premiums written 172.6 129.6 33.2  Premium growth in all lines of business; 173 Net earned premiums 104.6 93.8 11.5 strongest development in health with Financial result 9.2 7.6 21.9 +€18.0m

  30. Slide 30: Turkey/Georgia

    TURKEY/GEORGIA Profit growth driven by improved financial result GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +8.4% Gross premiums written 161.7 149.1 8.4  Premium growth driven by motor 162 Net earned premiums 82.5 70.2 17.6 (+€12.3mn) 149 Financial result 9.0 5.1 74.9 Other income 4.8 15.0 -68

  31. Slide 31: Remaining CEE

    REMAINING CEE Organic premium growth of 16.7% GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +18.1% Gross premiums written 336.1 284.6 18.1  Remaining CEE includes Albania (incl. 336 Net earned premiums 244.8 213.3 14.8 Kosovo), Bosnia-Herzegovina, Croatia, Financial result 26.3 26.1 0.9 Moldova,

  32. Slide 32: Other Markets

    OTHER MARKETS Germany and Liechtenstein GWP development (€mn) €mn 9M 2019 9M 2018 +/- % -1.9% Gross premiums written 228.2 232.7 -1.9  Premium decrease due to weaker life 233 Net earned premiums 193.8 198.3 -2.3 single premium business mainly in 228 Liechtenstein Financial result 14.3 14.6 -1.5 Oth

  33. Slide 33: Central Functions

    CENTRAL FUNCTIONS Deterioration due to lower financial result GWP development (€mn) €mn 9M 2019 9M 2018 +/- % +6.8% Gross premiums written 1 247.2 1 168.1 6.8  Central Functions include VIG Holding, 1,247 Net earned premiums 1 018.6 979.7 4.0 VIG Re, VIG Fund, the non-profit societies 1,168 Financi

  34. Slide 34: Appendix

    STRATEGY & OUTLOOK RESULTS 9M 2019 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 percenta

  35. Slide 35: Managing Board of Vienna Insurance Group

    MANAGING BOARD OF VIENNA INSURANCE GROUP As of 1 January 2020 Elisabeth Stadler, CEO Franz Fuchs Liane Hirner, CFO Peter Höfinger Gerhard Lahner Gabor Lehel Harald Riener Peter Thirring Regional and functional responsibilities will be available in due course on www.vig.com; Copyright of pictures: Ia

  36. Slide 36: 9M 2019 Key Financials

    9M 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 (%) 215 226 7.0 7.2 207 6.6 9M 17 9M 18 9M 19 9M 17 9M 18 9M 19 EPS net of hybrid interest1 (€) 2.36 2.15 2.07 9M 17 9M 18 9M 19 1: Annualis

  37. Slide 37: Attractive Dividend Policy with Newly Defined Payout Range

    ATTRACTIVE DIVIDEND POLICY WITH NEWLY DEFINED PAYOUT RANGE Payout ratio increased consistently to 47.6% by 2018 2016 2017 2018 Earnings per share 2.16 2.23 2.04 NEW DIVIDEND POLICY (€) Dividend per share Payout Ratio in a range of 0.80 0.90 1.00 (€) 30 – 50% of Group profits after taxes and non-cont

  38. Slide 38: Equity Development

    EQUITY DEVELOPMENT Decrease explained by deconsolidation of non-profit housing societies Change in Group Shareholders’ Equity (€mn) -11% 487 -143 295 -18 5,836 5,203 -1,254 Equity as Profit for Currency AFS unrealised Dividend Other1) Equity as of 12M 2018 the period changes gains and losses payment

  39. Slide 39: 9M 2019 Balance Sheet

    9M 2019 BALANCE SHEET IFRS (€mn) €mn 30.09.2019 31.12.2018 +/- % Intangible assets 2 160 1 961 10.2 Investments 34 393 36 288 -5.2 Unit- and index-linked investments 8 510 8 049 5.7 Reinsurers’ share in underwriting provisions 1 306 1 136 15.0 Receivables 1 694 1 563 8.4 Tax receivables and advance

  40. Slide 40: 9M 2019 Premiums by Business Lines and Country (I)

    9M 2019 PREMIUMS BY BUSINESS LINES AND COUNTRY (I) IFRS (€mn) MTPL Casco Other property 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- % Austria 259.0 258.8 0.1 235.1 227.1 3.5 1 150.1 1 080.0 6.5 Czech Republic 229.8 219.4 4.7 185.0 182.3 1.5 369.9 365.2 1.3 Slovakia 114.0 114.2 -0

  41. Slide 41: 9M 2019 Premiums by Business Lines and Country (II)

    9M 2019 PREMIUMS BY BUSINESS LINES AND COUNTRY (II) IFRS (€mn) Life regular Life single Health 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- % Austria 930.5 937.1 -0.7 209.4 179.8 16.5 322.1 313.5 2.7 Czech Republic 476.8 457.7 4.2 34.7 39.4 -11.8 12.3 10.4 18.1 Slovakia 137.9 128.

  42. Slide 42: 9M 2019 Country Overview GWP / PBT / Combined Ratio

    9M 2019 COUNTRY OVERVIEW GWP / PBT / COMBINED RATIO IFRS (€mn) GWP Total Result before taxes Combined Ratio net (in %) 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- % 9M 2019 9M 2018 +/- %p Austria 3 106.2 2 996.4 3.7 141.8 130.2 8.9 94.1 94.9 -0.8 Czech Republic 1 308.5 1 274.4 2.7 122.3 123.8 -1.3 94.

  43. Slide 43: S&P Rating Confirmed in August 2019

    S&P RATING CONFIRMED IN AUGUST 2019 VIG remains best-rated company in the ATX Financial Risk Profile: Business BusinessRisk Financial RiskProfile: Profile: Very Strong Strong Strong Very Strong  „Leading market position in Austria and  Confirmation of “comfortable capital in most Central and Easte

  44. Slide 44: VIG Share (I)

    VIG SHARE (I) Number of common shares: 128,000,000 / ISIN: AT0000908504 General information Analyst recommendations (30 Sep. 2019) Current listings Ticker Rating Major Indices SELL Vienna  Vienna Stock Exchange: VIG Standard & Poor´s: ATX 1 BUY Prague  Bloomberg: VIG AV / VIG CP A+, stable outlook

  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 VIG VIENNA INSURANC

  46. Slide 46: Appendix

    46 APPENDIX VIG VIENNA INSURANCE GROUP

  47. Slide 47: Contact Details / Financial Calendar

    CONTACT DETAILS / FINANCIAL CALENDAR Investor Relations / investor.relations@vig.com / www.vig.com Nina Higatzberger-Schwarz Sylvia Machherndl Financial calendar 2020* Tel. +43 (0)50 390 – 21920 Tel. +43 (0) 50 390 – 21151 Date Event nina.higatzberger@vig.com sylvia.machherndl@vig.com 19 Mar. 2020 P

  48. Slide 48: 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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