Tryg A/s · OMXCOP:TRYG
Tryg A/s — Tryg Forsikring — Debt Investor Presentation (October 2015)
21 slides from Tryg A/s's debt investor presentation, Oct 26, 2015
Slide 1: Tryg Forsikring A/S Tier 2 subordinated bond issue
Arranged by: Tryg Forsikring A/S Tier 2 subordinated bond issue Company presentation October 2015
Slide 2: Important information
Important information Disclaimer Certain statements in today’s presentations 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 res
Slide 3: Strong value propositions
Strong value propositions Proven distribution platform | High profitability | Low balance sheet risk Stable inflow of cash I Leading Scandinavian non-life insurance player DKKbn 30 Return on Equity (%) 35% Hundreds 25 30% 20 25% II Solid and stable earnings and profitability 15 20% 10 15% 5 10% 0 5%
Slide 4: Tryg Forsikring A/S at a glance (I)
Tryg Forsikring A/S at a glance (I) Leading Nordic non-life insurance company • Tryg’s history dates back to the Tryg’s operating fundamentals 2014 premiums split by COUNTRY 18th century Customer • Focuses on non-life insurance in Satisfaction Denmark, Norway and Sweden 12% • Primarily provides insu
Slide 5: Tryg Forsikring A/S at a glance (II)
Tryg Forsikring A/S at a glance (II) Operating in attractive market fundamentals Tryg figures Market combined ratio development Market share DENMARK Tryg 18% 100% 31% Topdanmark Codan EUR 95% Alm Brand. 6.9bn 18% TOP5 Gjensidige 6% If 6% 12% 90% Sweden 10% Other 85% Market share NORWAY Norway Gjensi
Slide 6: Tryg Forsikring A/S at a glance (III)
Tryg Forsikring A/S at a glance (III) Attractive equity story Leading Scandinavian insurer with strong track record Low risk and Financial targets 2017 Customer targets 2017 Customer care high returns worth recommending • ROE: ≥21% • NPS +100% • Combined ratio: ≤87% • Retention rate +1 pp • Matching
Slide 7: Solid track record
Solid track record Proven operations ensure stable inflow of cash 4,000 3,500 3,000 Established premium I portfolio with high Selected financial results 2,500 2,000 retention rate 1,500 1,000 500 Attractive underlying 0 II underwriting -500 profitability -1,000 -1,500 2005 2006 2007 2008 2009 2010 2
Slide 8: Sustainable efficiency program 2015-17E
Sustainable efficiency program 2015-17E Expense and claims reduction of more than DKK 750m within 3 years Overview of efficiency program 2015-17E Annual cost savings 2012-17E OLD program NEW program DKK Expense 250m reduction DKK 388 395 375 750m 118 DKK Claims 225 500m reduction 175 45 Q3 150 73 H1
Slide 9: Sound investment approach and related return
Sound investment approach and related return Conservative asset allocation and low return volatility provides consistency Portfolio Q3 2015 (DKK 39.7bn) Standard deviation of Return on Investment 2011-13 60% Bonds/deposits 13.0% 50% Inv. Property 5.1% 40% EM 1.0% Free 30% HY 2.2% 10.6bn 27% 20% Equi
Slide 10: Disciplined capitalization
Disciplined capitalization Sizable capital buffer already in place ensuring comfortable headroom Key comments Increasing capital buffer 90% • Tryg’s individual solvency capital buffer was 59% at the end of Q3 2015 70% • The individual capital buffer has increased over 30 50% percentage points from a
Slide 11: Solid rating from Standard & Poor's
Solid rating from Standard & Poor’s* Low business & financial risk together with stable outlook yields an A- rating Rating and underlying rationale Key comments • Standard & Poor’s expects that Tryg will: Financial Counterparty Strength Rating Credit Rating - defend its strong competitive position -
Slide 12: Achievable long-term business plan
Achievable long-term business plan Well defined strategic targets reveal ambitious plans for the company Financial targets Customer targets Return on 2015: = 20% Net I Equity (ROE) after tax 2017: ≥ 21% I Promoter Score (NPS) 2017: + 100 2015: ≤ 90 II Combined ratio 2017: ≤ 87 II Retention rate 2017
Slide 13: Transaction summary
Transaction summary Key terms Issuer: Tryg Forsikring A/S Instrument: Solvency 2 Compliant Subordinated bond issue (Tier 2 Capital) S&P Ratings: A- (Issuer Rating) / BBB (Expected Instrument Rating) Volume: NOK [Benchmark] Maturity: [] 2045 Ordinary calls on [] [2025], and any interest payment dat
Slide 14: Key investment considerations
Key investment considerations Nordic footprint | Lean operations | High profitability | Strong capitalization Dedicated Nordic non-life insurance company, with 1 proven operations and favourable outlook, diversified across both countries and products Operates in mature markets, with high entry barri
Slide 15: Appendix
Appendix
Slide 16: Distribution of new sales 2014
Distribution of new sales 2014 Broad distribution power through diverse sales channels is key Denmark Norway 13% 8% Own sales Own sales Car dealers 45% Affinity 32% 24% Affinity 63% Nordea Nordea 15% Sweden Corporate 14% Own sales Own sales External partners 43% 26% 56% 57% Online & others Brokers 4
Slide 17: Key financial figures and consensus 2011-17E
Key financial figures and consensus 2011-17E Overview CONSENSUS ** DKKm 2011 2012 2013 2014 2015E 2016E 2017E Gross premium income 19,948 20,314 19,504 18,652 18,028 18,014 18,284 Technical result 1,572 2,492 2,496 3,032 2,623 2,748 2,887 Investment income, net 61 585 588 360 116 248 249 Pre-tax pro
Slide 18: Established ownership structure
Established ownership structure 60% owned by TryghedsGruppen (foundation) and 40% free float TOP10 shareholders* Geographical distribution of free float (40%) year-end 2014 TryghedsGruppen 60.00 % 14% Denmark Tryg A/S 1.89 % UK 6% Danske Capital 1.65 % 52% US 14% Nordics Norges Bank Investment Manag
Slide 19: Solid rating from Standard & Poor's
Solid rating from Standard & Poor’s Low business & financial risk together with stable outlook yields an A- rating Rating and underlying rationale Base-case scenario assumptions and methodology Junior Counterparty Financial Macroeconomic assumptions Subordinated Credit Strength Subordinated Rating R
Slide 20: Key economic figures in the Nordic region
Key economic figures in the Nordic region Stable outlook Tryg exposure % 2015E 2016E GDP Growth 1.5 2.0 Inflation 0.6 1.5 Denmark Unemployment 4.7 4.3 Current account balance in % of GDP 6.3 5.6 Budget balance in % of GDP -2.3 -1.9 Public debt in % of GDP 39.1 41.0 TOP5 % 2015E 2016E GDP Growth 1.2
Slide 21: Tryg Forsikring A/S contact details
Arranged by: Tryg Forsikring A/S | Klausdalsbrovej 601 | 2750 Ballerup | Denmark | Tel: +4570112020
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