Vienna Insurance Group AG · VIE:VIG

Vienna Insurance — Q1 2020 Earnings Presentation

49 slides from Vienna Insurance's earnings presentation, Jun 23, 2020

  1. Slide 1: Investor Presentation: Results for the first quarter 2020

    VIENNA INSURANCE GROUP Investor Presentation Results for the first quarter 2020

  2. 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 YE 2019 50% of premiums and profits coming A+ 210% with stable outlook based on Partial Internal Model from CEE Since Market capitalization

  3. Slide 3: 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

  4. Slide 4: 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 6 4 Romania 1 2 2 1 The Baltic 1 1 3 3 1 Hungary 6 6 4 1 6 3 Bulgaria 1 12 1 2 1 4 4 total no

  5. Slide 5: Long-term growth potential

    LONG-TERM GROWTH POTENTIAL Annual insurance spending shows growth potential in Austria and CEE Insurance density 2018, in EUR (premiums per capita) 1,940 Ø EU-15: ~€2,800 Ø CEE-VIG: ~€200 542 418 380 370 331 319 314 284 184 138 121 112 110 105 78 54 46 46 35 19 North Macedonia Turkey Hungary Lithuan

  6. Slide 6: Agenda 2020: Update 2019

    AGENDA 2020: UPDATE 2019 Overview Ensuring future growth Optimisation of business model Use of growth potentials Digitalisation Anti-Fraud-Management Health insurance  ~180 ongoing digitalisation projects  2019: Roll-out in 8 additional companies 42% premium increase in the 5 key countries of BG,

  7. Slide 7: Successful Bancassurance

    SUCCESSFUL BANCASSURANCE Growth rates in 2019 exceeding plans  Total premium volume generated in 2019: €1.3bn (+5.2%)  Life: +4.3%, Non-Life: +10.9% (thereof Health +24.2%)  CEE: double-digit growth rates in Life regular and Non-Life CZ  Integral part of Agenda 2020 SK  Focus on increasing sale

  8. Slide 8: 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 meeting with more than 30 participants; agenda included best practise sharing of individual Group initi

  9. Slide 9: 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

  10. Slide 10: Dividend increase of 15% to €1.15 per share

    DIVIDEND INCREASE OF 15% TO €1.15 PER SHARE Fourth consecutive increase in DPS 2016 2017 2018 2019 Earnings per share 2.16 2.23 2.04 2.59 (€) DIVIDEND POLICY Dividend per share 0.80 0.90 1.00 1.15* Payout Ratio in a range of (€) 30 – 50% of Group profits after taxes and non-controlling interests Pay

  11. Slide 11: 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

  12. Slide 12: Results 3M 2020

    STRATEGY RESULTS 3M 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

  13. Slide 13: Highlights 3M 2020

    HIGHLIGHTS 3M 2020 Sound performances in January and February allowed for a solid first quarter Gross written premium Profit before taxes Combined Ratio € 3,118.2mn € 121.9mn 95.1% GWP up by 7.2% (+€210mn) PBT down by 4.4% (-€5.6mn) -1.7ppt driven by improved claims ratio  Strongest contribution by

  14. Slide 14: Growth in premiums (+7%) and net profit (+3%)

    GROWTH IN PREMIUMS (+7%) AND NET PROFIT (+3%) 3M 2020 Income statement €mn 3M 2020 3M 2019 +/- % Gross premiums written  Premium growth driven by other property (+€131mn), life single 3,118.2 2,908.2 7.2 premium business (+€68mn; increased coverage to existing Net earned premiums 2,488.3 2,303.0 8.

  15. Slide 15: Top-line growth based on excellent start into 2020

    TOP-LINE GROWTH BASED ON EXCELLENT START INTO 2020 Overview by segments Gross written premiums (€mn; y-o-y chg.)  Overall GWP of €3.1bn (+7.2%); organic growth of +5.3%  CEE growth of 9.4%  Premium growth drivers are Austria (+€86mn), Poland (+€63mn; incl. first-time consolidation of Wiener TU),

  16. Slide 16: Growth in all lines of business; COVID-19 impact expected from Q2

    GROWTH IN ALL LINES OF BUSINESS; COVID-19 IMPACT EXPECTED FORM Q2 2020 ONWARDS Gross written premiums by lines of business (€mn; y-o-y chg.); incl. Central Functions MTPL Casco Other property Total premiums +7.2% 3M 2019 393 338 1,456 3,118 +5.9% +3.5% +9.0% 2,908 416 3M 2020 416 350 1,588 MTPL 393

  17. Slide 17: Group profit before taxes of €121.9mn down by 4.4%

    GROUP PROFIT BEFORE TAXES OF €121.9MN DOWN BY 4.4% Net profit after taxes and non-controlling interests of €85.8mn up by 2.8% (+€2.3mn) Result before taxes (€mn; y-o-y change)  AT: €4.0mn profit decrease driven by less financial result based on negative capital markets developments  CZ/SK: profit

  18. Slide 18: Combined ratio (P&C) down to 95.1%

    COMBINED RATIO (P&C) DOWN TO 95.1% Claims ratio improvement drives positive development P&C Combined Ratio development Overview by segments (y-o-y development net, %)  Improved CoR in all market segments, despite Remaining CEE -1.1%p -1.0%p -1.5%p -7.8%p -5.1%p -1.4%p  Claims ratio decrease in Q1

  19. Slide 19: Investment split and bond portfolio overview

    INVESTMENT SPLIT AND BOND PORTFOLIO OVERVIEW No material change in bond portfolio 3M 2020: Total €34.7bn Bond portfolio by rating1 in % 3.7% 1.5% 7.8% AAA AA A BBB Other 3M 2020 9.4 30.8 36.8 19.3 3.7 7.0% 12M 2019 9.0 31.0 36.8 19.1 4.1 7.4% 72.6% Bond portfolio by issuer in % 3M 2020 53.3 7.1 17.4

  20. Slide 20: Financial result

    FINANCIAL RESULT Current income down by 25.4% due to consolidation change of non-profit societies €mn 3M 2020 3M 2019 +/- % Current income 240,118 322,053 -25.4  Change of consolidation method of non-profit societies affects Income from appreciations 3,892 5,858 -33.6 current income, depreciation o

  21. Slide 21: COVID-19 Update

    COVID-19 UPDATE Situation as of Q1 2020 Priorities overall Internal  Home office for vast majority of employees measures  Extended country reporting and intensive exchange between VIG Holding Board - Safety of staff and customers and management of local Group companies  Regular reporting of devel

  22. Slide 22: Executive Summary Q1 2020

    EXECUTIVE SUMMARY Q1 2020 Market environment characterised by high uncertainty  Q1 2020 results nearly unaffected by COVID-19 pandemic; impacts in following quarters are not assessable at the moment  Strong balance sheet provides a resilient foundation  Agenda 2020 with its focus on increasing ef

  23. Slide 23: Segments

    STRATEGY RESULTS 3M 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

  24. Slide 24: Austria

    AUSTRIA Result impacted by decreased financial result GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +6.7% Gross premiums written 1,364.8 1,278.8 6.7  Premium growth of €86.0mn driven 1,365 Net earned premiums 896.7 835.7 7.3 mainly by life single premium business 1,279 Financial result* 133.4 140

  25. Slide 25: Czech Republic

    CZECH REPUBLIC Strong non-life development due to improved CoR GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +2.4% Gross premiums written 465.8 454.9 2.4  Premiums up by €10.9mn driven by 466 Net earned premiums 342.8 339.0 1.1 other property and MTPL 455 Financial result* 21.3 18.3 16.3 79 Other

  26. Slide 26: Slovakia

    SLOVAKIA Positive non-life and life performance GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +4.8% Gross premiums written 219.7 209.6 4.8  Premium growth of €10.1mn based on 220 Net earned premiums 167.3 167.2 0.0 increased other property, life and health 210 Financial result 9.5 10.5 -9.7 busin

  27. Slide 27: Poland

    POLAND Favourable premium and profit development GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +25.2% Gross premiums written 313.5 250.4 25.2  Premium growth of €63.1mn driven 313 Net earned premiums 235.7 188.6 25.0 mainly by other property (+€28.5mn) Financial result 9.0 10.2 -11.0 and motor (+

  28. Slide 28: Romania

    ROMANIA Ongoing focus on profitable business GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +8.6% Gross premiums written 125.9 115.9 8.6  Premiums up by €10.0mn driven by 126 Net earned premiums 90.5 95.1 -4.8 other property business and casco 116 Financial result 4.2 4.5 -7.1 23 Other income 3.8

  29. Slide 29: Baltic States

    BALTIC STATES Change in accounting methodology at Seesam Insurance GWP development (€mn) €mn 3M 2020 3M 2019 +/- % -1.7% Gross premiums written 131.0 133.3 -1.7  Small premium decrease driven by 133 Net earned premiums 96.7 93.6 3.3 motor (-€7.8mn); positive premium 131 development in health (+€2.6

  30. Slide 30: Hungary

    HUNGARY Solid development despite negative FX impact GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +21.6% Gross premiums written 98.7 81.2 21.6  Premium growth of €17.5mn driven by 99 Net earned premiums 62.7 45.5 37.7 life single premium business Financial result 1.7 1.3 34.3 (+€16.3mn) and life

  31. Slide 31: Bulgaria

    BULGARIA Improved CoR supports profit growth GWP development (€mn) €mn 3M 2020 3M 2019 +/- % -6.5% Gross premiums written 62.2 66.5 -6.5  Premium decrease of €4.3mn due to 67 Net earned premiums 40.0 37.6 6.5 decreased health (-€6.6mn) and life 62 Financial result 3.2 2.9 8.1 business (-€2.2mn) tha

  32. Slide 32: Turkey/Georgia

    TURKEY/GEORGIA Strong premium growth in Turkey and Georgia GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +26.3% Gross premiums written 71.7 56.8 26.3  Premiums up by €14.9mn with other 72 Net earned premiums 32.0 25.7 24.4 property growing by +€6.2mn and Financial result 2.3 2.8 -18.6 health by +

  33. Slide 33: Remaining CEE

    REMAINING CEE Overall positive performance despite CoR being above 100% GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +17.9% Gross premiums written 126.8 107.6 17.9  Remaining CEE: Albania (incl. Kosovo), 127 Net earned premiums 92.2 70.6 30.6 Bosnia-Herzegovina, Croatia, Moldova, Financial resul

  34. Slide 34: Other Markets

    OTHER MARKETS Germany and Liechtenstein GWP development (€mn) €mn 3M 2020 3M 2019 +/- % -2.2% Gross premiums written 77.4 79.1 -2.2  Premiums slightly down by €1.7mn due to 79 Net earned premiums 63.0 65.0 -3.1 seasonal effects in the life single premium 77 business in Liechtenstein Financial resul

  35. Slide 35: Central Functions

    CENTRAL FUNCTIONS Deterioration due to lower financial result following the consolidation change of the Austrian housing societies GWP development (€mn) €mn 3M 2020 3M 2019 +/- % +6.8% Gross premiums written 483.9 453.1 6.8  Central Functions include VIG Holding, 484 Net earned premiums 361.1 338.8

  36. Slide 36: Appendix

    STRATEGY RESULTS 3M 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

  37. Slide 37: 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

  38. Slide 38: 3M 2020 Key Financials

    3M 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* (€) 83 86 11.1 2.61 2.68 76 9.3 8.5 2.27 3M 18 3M 19 3M 20 3M 18 3M 19 3M 20 3M 18 3M 19 3M 20 * Based on Sha

  39. Slide 39: 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

  40. Slide 40: 2020 Balance Sheet

    2020 BALANCE SHEET IFRS (€mn) €mn 31.03.2020 31.12.2019 +/- % Intangible assets (incl. Right-of-Use Assets) 2,068 2,137 -3.2 Investments 33,264 34,456 -3.5 Unit- and index-linked investments 7,479 8,620 -13.2 Reinsurers’ share in underwriting provisions 1,348 1,283 5.0 Receivables 1,803 1,717 5.0 Ta

  41. Slide 41: Equity Development

    EQUITY DEVELOPMENT Decline due to negative market developments for investments and currencies Change in consolidated Shareholders’ Equity (€mn) -9% 89 -143 5,191 -432 4,701 -2 -2 Equity as Profit for Currency AFS unrealised Dividend Other Equity as of 12M19 the period changes gains and losses paymen

  42. Slide 42: 3M 2020 Premiums by Business Lines and Country (I)

    3M 2020 PREMIUMS BY BUSINESS LINES AND COUNTRY (I) IFRS (€mn) MTPL Casco Other property 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % Austria 112.1 110.7 1.3 100.8 99.5 1.3 583.3 555.3 5.1 Czech Republic 79.2 77.3 2.4 60.9 60.3 1.0 144.3 136.0 6.1 Slovakia 41.6 43.2 -3.6 27.3 27.

  43. Slide 43: 3M 2020 Premiums by Business Lines and Country (II)

    3M 2020 PREMIUMS BY BUSINESS LINES AND COUNTRY (II) IFRS (€mn) Life regular Life single Health 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % Austria 342.0 341.8 0.1 111.5 61.6 81.0 115.1 110.0 4.6 Czech Republic 167.4 163.4 2.4 9.5 14.2 -33.6 4.6 3.8 20.4 Slovakia 44.3 43.3 2.4 5

  44. Slide 44: 3M 2020 Country Overview GWP / PBT / Combined Ratio

    3M 2020 COUNTRY OVERVIEW GWP / PBT / COMBINED RATIO IFRS (€mn) GWP Total Result before Taxes Combined Ratio net (in %) 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % 3M 2020 3M 2019 +/- % Austria 1,364.8 1,278.8 6.7 41.4 45.4 -8.9 95.5% 96.6% -1.1 Czech Republic 465.8 454.9 2.4 45.5 41.5 9.6 94.6% 95.6

  45. Slide 45: VIG Share (I)

    VIG SHARE (I) Number of common shares: 128,000,000 / ISIN: AT0000908504 General information Analyst recommendations (31 Mar. 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 Pr

  46. Slide 46: 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) 46 APPENDIX VIG VIENNA INSURAN

  47. Slide 47: Appendix

    47 APPENDIX VIG VIENNA INSURANCE GROUP

  48. Slide 48: Contact Details / Financial Calendar

    CONTACT DETAILS / FINANCIAL CALENDAR Investor Relations / investor.relations@vig.com / www.vig.com Nina Higatzberger-Schwarz Sylvia Machherndl Financial calendar 20201 Tel. +43 (0)50 390 – 21920 Tel. +43 (0) 50 390 – 21151 Date Event nina.higatzberger@vig.com sylvia.machherndl@vig.com 17 Mar. 2020 P

  49. Slide 49: 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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