Slide 1: Financial Results for the half year ended 31 December 2023
For personal use only Financial Results For the half year ended 31 December 2023 26 February 2024 SUNCORP GROUP LIMITED | ABN 66 145 290 124
Slide 2: 1H24 Overview
For personal use only 1H24 Financial Results 2 1H24 Overview Steve Johnston Group Chief Executive Officer
Slide 3: Purpose driven, delivering strong outcomes for the long term
1H24 Financial Results 3 Purpose driven, delivering strong outcomes for the long term For personal use only
Slide 4: Group result
1H24 Financial Results 4 Group result For personal use only Strong top line growth and guidance Profit after tax from functions reiterated Consumer $203m ( 534.4%) Commercial & Personal Injury $194m ( 16.0%) ― Strong top-line growth across the Group reflecting customer growth and pricing ― Improve
Slide 5: Result snapshot
1H24 Financial Results | 5 Result snapshot Consumer For personal use only Gross written premium Home Consumer Home Consumer Motor Gross Written Premium 12.0% Gross Written Premium 18.2% Commercial Insurance Ex-CTP 16.2% New Zealand Gross Written Premium Gross Written Premium 19.6% CTP 8.8% General I
Slide 6: Pathway to Bank completion and transition
1H24 Financial Results 6 Pathway to Bank completion and transition For personal use only 20 February 2024 mid-2024 Q4 2024 NOTES Tribunal ― On 20 February 2024, the Outcome Australian Competition Tribunal granted authorisation ― Sale remains subject to the amendment of the State Financial Transactio
Slide 7: Jeremy Robson, Group Chief Financial Officer
For personal use only 1H24 Financial Results 7 1H24 Financial Results Jeremy Robson Group Chief Financial Officer
Slide 8: Group result overview
1H24 Financial Results 8 Group result overview For personal use only Strong top-line growth and underlying margins on target 1H24 1H23 Change KEY MESSAGES ($m) ($m) (%) Consumer 203 32 534.4 ― Strong top-line growth driven by customer growth and Commercial & Personal Injury 194 231 (16.0) pricing Ne
Slide 9: General Insurance – underlying profit & margin
1H24 Financial Results 9 General Insurance – underlying profit & margin For personal use only REPORTED TO UNDERLYING PROFIT WALK UITR1 DRIVER ANALYSIS (79) 1H24 vs 1H23 2H24 Outlook 142 +27.8% (38) 1H23 UITR 10.0% (68) 4 21 Natural Hazard Allowance (0.4)% Tailwind Expenses (incl. Commissions) 0.8% N
Slide 10: General Insurance – prior year reserves and loss component
1H24 Financial Results 10 General Insurance – prior year reserves and loss component For personal use only PRIOR YEAR RESERVE STRENGTHENING / (RELEASES) NOTES 1H24 Expected PYRR ― Motor strengthening driven by higher repair costs and extended repair times, ($m) (% of Group NIR) especially in relatio
Slide 11: General Insurance - natural hazards & reinsurance
1H24 Financial Results 11 General Insurance - natural hazards & reinsurance For personal use only NATURAL HAZARD EVENTS >$10 MILLION BY MONTH NOTES 356 Natural Hazards ― Natural hazards experience was primarily driven by Australian events in late December ― The full limits on all of the Group’s rein
Slide 12: General Insurance – investment market impacts
1H24 Financial Results 12 General Insurance – investment market impacts For personal use only UNDERLYING YIELD ON INSURANCE FUNDS (AUS) PORTFOLIO ASSET ALLOCATION 5.5% (% of total investment assets) 5.4% 5.0% 0.5% 0.4% 0.1% 6% 0.5% 1.0% 1.0% 4% 0.6% 15% 8% 0.8% 0.7% 15% $15.2b 19% $1.3b 3.9% 3.1% 3.
Slide 13: Consumer – portfolio growth
1H24 Financial Results 13 Consumer – portfolio growth For personal use only HOME AND MOTOR PORTFOLIO GROWTH MOTOR REPAIR INFLATION1 COST PER POLICY INFLATION2 (versus pcp; normalised for portfolio exits) 15.9% 17% 13.5% 10.7% 9.9% 9.9% 8.9% 12.0% 7.5% 13% 4.9% 4.9% 11% 7% 4.5% 2.9% 2.8% 2.1% 2.3% 2.
Slide 14: Consumer – underlying profit, margin & claims
1H24 Financial Results 14 Consumer – underlying profit, margin & claims For personal use only UNDERLYING PROFIT UISR WALK 1H24 1H23 Change (0.4%) 0.3% ($m) ($m) (%) 0.6% Gross written premium 3,663 3,169 15.6 Net insurance revenue 3,050 2,646 15.3 Net incurred claims (2,439) (2,128) (14.6) 1.3% Dire
Slide 15: Commercial & Personal Injury
1H24 Financial Results 15 Commercial & Personal Injury For personal use only UNDERLYING PROFIT GWP WALK ($m) 1H24 1H23 Change ($m) ($m) (%) 44 46 Gross written premium 1,905 1,672 13.9 Net insurance revenue 1,705 1,556 9.6 124 Net incurred claims (1,160) (1,048) (10.7) 19 1,905 Directly attributable
Slide 16: New Zealand
1H24 Financial Results 16 New Zealand For personal use only UNDERLYING PROFIT GWP WALK 1H24 1H23 Change (NZ$m) 4 (NZ$m) (NZ$m) (%) 54 Gross written premium 1,411 1,180 19.6 68 Net insurance revenue 1,004 964 4.1 Net incurred claims (606) (547) (10.8) 105 Directly attributable expenses (306) (280) (9
Slide 17: Suncorp Bank
1H24 Financial Results 17 Suncorp Bank For personal use only REPORTED PROFIT NET INTEREST MARGIN 1H24 1H23 Change ($m) ($m) (%) (0.05%) 0.03% Net interest income 666 725 (8.1) 0.01% Other operating income (5) 8 n/a (0.08%) 1.89% Operating expenses (386) (366) (5.5) Operating profit 275 367 (25.1) Im
Slide 18: Suncorp Bank – credit quality
1H24 Financial Results 18 Suncorp Bank – credit quality For personal use only HOME LENDING ORIGINATIONS: DEBT-TO-INCOME > 6x HOME LENDING: LOAN-TO-VALUE > 80% 17% 12% 11% 14% 9% 10% 11% 10% 7% 8% 5% 4% 4% 5% FY22 FY23 1% 1% 1% 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 1H23 2H23 1H24 Industry1 Suncorp Portfolio
Slide 19: Group operating expenses
1H24 Financial Results 19 Group operating expenses For personal use only GROUP OPERATING EXPENSES1 NOTES (excluding restructuring, ESL and TEPL; $m) 1,207 ― Increase in Insurance run the business costs 1,128 45 20 22 driven by inflation in wages and technology and 16 14 an increase in system mainten
Slide 20: Group capital
1H24 Financial Results | 20 Group capital For personal use only COMMON EQUITY TIER 1 CAPITAL HELD AT GROUP NOTES ($m) ― $237m of CET1 held at Group ― AASB17 transition and Bank transaction cost impacts are broadly offsetting ― 34 cps fully franked final dividend, interim payout ratio 65% (402) ― Add
Slide 21: Strategy & Outlook
For personal use only 1H24 Financial Results 21 Strategy & Outlook Steve Johnston Group Chief Executive Officer
Slide 22: Factors driving insurance pricing
1H24 Financial Results 22 Factors driving insurance pricing For personal use only NUMBER OF NATURAL HAZARD CLAIMS GROSS NATURAL HAZARD COSTS (‘000s) ($b) ~$10b 100k 176 140 151 134 2.6 108 2.3 1.6 1.7 1.1 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 NATURAL HAZARD ALLOWANCE & REINSURANCE PREMIU
Slide 23: Four point plan for a more resilient Australia
1H24 Financial Results 23 Four point plan for a more resilient Australia For personal use only 1 Improve public infrastructure 3 Address inadequate planning laws and approval processes 2 Provide subsidies to improve the resilience of private dwellings 4 Remove inefficient taxes and charges from insu
Slide 24: Aligning everyone at Suncorp to core Insurance business
1H24 Financial Results 24 Aligning everyone at Suncorp to core Insurance business For personal use only February 2019 May 2019 October 2019 February 2021 December 2021 March 2022 Mid 2024 Sale of the Australian Sale of Resilium Sale of Capital S.M.A.R.T and Exited underperforming Sale of RACTI Sale
Slide 25: FY24 Outlook
1H24 Financial Results | 25 FY24 Outlook For personal use only ― Insurance: • GWP growth now expected to be in the low to mid-teens driven by AWP increases to respond to increased input costs • Underlying ITR supported by premium momentum, offsetting reinsurance and natural hazard costs, and claims
Slide 26: Questions
For personal use only 1H24 Financial Results 26 Questions
Slide 27: Important disclaimer
1H24 Financial Results 27 Important disclaimer For personal use only This presentation contains general information which is current as at 26 February 2024. It is information given in summary form and does not purport to be complete. It is not a recommendation or advice in relation to Suncorp Group