25.05.2011 |
- Consistent growth in IFRS premiums with an increase of 3.0% to €1,800 million
- Growth in all regions (Austria, Eastern Europe, Western Europe) and segments (life, property and casualty, health insurance)
- Above-average growth of 4.5% in recurring premiums
- Costs and benefits reduced (minus of 3.4%)
- Profit on ordinary activities remain stable year-on-year at €47 million
- Group profit grew by 17.2% to €27 million
- Group embedded value in 2010 at €2.8 billion
UNIQA CEO Konstantin Klien comments: "The very pleasing increase of 3 per cent in group premium volume written, to €1,800 million, has shown once again that the UNIQA Group's strategic course of internationalisation is the right path. In the first quarter of the current year, we were able to post growth in all insurance sectors and in all regions, including Austria. Recurring premiums even had above-average growth of 4.5%. This success confirms UNIQA's strategy of regional diversification. Thanks to this growth and strongly improved loss ratios, profit (before taxes) in the first quarter of 2011 was able to stay steady year-on-year at €47 million. After taxes and minority interests, the remaining consolidated profit for the period was €27 million, roughly 17.2% higher than in the first quarter of 2010."
Working against broad market trends, the UNIQA Group succeeded in the first quarter of 2011 in increasing its IFRS premiums written (including the savings portion of unit- and index-linked life insurance) by 3.0% to €1,800 million.
1st Quarter 2011: UNIQA grows in all regions Premium growth in the first quarter came from all regions (Austria, Eastern and South-Eastern Europe, Western Europe) and all segments (life, property and casualty, health insurance). While there was a decrease in single premiums of 6.2% to €227 million, recurring premiums experienced significant growth of 4.5% to €1,573 million.
In the domestic market in Austria, despite a decrease in single premiums, premiums grew by 1.0% to €1,078 million. In international business, premiums increased by 6.0% to €721 million. The share of international business in the first quarter was a total of 40.1%. The greatest growth driver in the first quarter of 2011 came from Western Europe, with strong premium growth of 9.0% to €392 million, driven by developments in life insurance. Despite the difficult economic situation, negative currency effects and significant decreases in single premiums, life insurance in Eastern and South Eastern Europe was able to post premium growth of 2.7% to €330 million.
1st Quarter 2011: Significant growth dynamic in all insurance segments The property and casualty insurance line was the fastest growing segment with a 5.5% increase in premiums Group-wide to €881 million in premium volume written in the first quarter of 2011. This growth can be attributed to above-average increases of 8.5% in international business. The premium volume written in international business amounted to €390 million. Eastern and South Eastern Europe contributed to the international business results with growth of 7.5% and €223 million in premium volume written, while Western Europe grew by 9.9% and added €167 million in premium volume written. In Austria, the first quarter's 3.2% increase in premiums (€491 million in premium volume written) also clearly exceeded market forecasts for 2011.
In the first quarter, Group-wide growth in the life insurance line was 0.5% to €656 million in premium volume written. Austria posted a decrease of 2.7% (€377 million in premium volume written); Eastern and South Eastern Europe posted a decrease of 7.6% (€102 million in premium volume written). These results were affected by strong decreases in single premiums in these regions; Group-wide, single premiums decreased by 6.2% to €227 million. Recurring life insurance premiums, however, were able to post a Group-wide gain of 4.5% to €429 million. In Austria, recurring life insurance premiums in the first quarter of 2011 were significantly over market forecasts with a plus of 3.0%; in Eastern and South Eastern Europe, growth was 18.3%. Western Europe was able to deliver strong growth again at 14.3% (€177 million in premium volume written), which can be attributed primarily to a successful partnership with the Veneto Banca Group in Italy.
Premium growth in the health insurance line amounted to 1.1% in the first quarter of 2011; Group-wide premium volume written reached €263 million. In Austria, market leadership was consolidated with an increase in premiums of 3.1% and €210 million in premium volume written. Western Europe posted a decrease of 9.0% to €48 million in premium volume written. Eastern and South Eastern Europe, starting at a low level, were able to record very strong growth of 52.7% in the first quarter of 2011; premium volume written amounted to €4 million.
1st Quarter 2011: Group profit grew by 17.2% to €27 million The investment portfolio as at 31 March 2011 was at €24,404 million, which is 3.0% above the comparison value of the previous year (€23,690 in 2010; investment inventory as at 31 Dec. 2010: €24,246 million). Net investment income fell in the first three months of 2011 by 30.1% to €175 million, primarily because of lower realised stock market gains and negative currency effects.
Due to the positive developments in the area of property and casualty and, in line with the lower capital incomes, the decreased allocation to technical provisions in the life insurance business, the total amount of insurance benefits retained by the UNIQA Group in the first quarter of 2011 fell by 7.4% to €1,103 million. The claims and benefits ratio across all lines sank to a pleasing 72.9% (first quarter 2010: 80.3%). Total operating expenses increased in the first quarter of 2011 by 11% to €363 million, driven primarily by increasing commission expenses in life insurance and increased expenses for social capital. In total, services and costs fell below the previous year's levels by 3.4% to €1,466 million.
Despite lower capital incomes, the UNIQA Group's profit on ordinary activities - thanks to this growth and strongly improved loss ratios, before taking into account Hungary's special tax on the finance sector - was able to stay steady year-on-year at €47 million. After taxes and minority interests, the remaining consolidated profit for the period was €27 million, roughly 17.2% higher than in the first quarter of 2010.
Outlook Under the prerequisite of anticipated normalisation of international profits and stable domestic profit development, UNIQA assumes that 2011 will deliver further improvement in operating profits. Underlying assumptions include significant reductions compared to 2010 in claims due to natural disasters, stable capital markets, and a positive economic environment.
Group embedded value 2010 negatively affected by changes in the economic environment Despite improvements at the operating level, the UNIQA Group's European embedded value for 2010 fell together with the European industry trend, due to generally lower interest rates, climbing interest rate volatility, and associated higher costs for options and guarantees. Activities in Austria and Italy were particularly impacted, while developments in life insurance in Eastern and South Eastern Europe resulted in an increased embedded value in this region. In total, the UNIQA Group's European embedded value in 2010 was €2.78 billion (2009: €3.03 billion), a decrease of 8%. After deducting minority shares, the Group embedded value reached €2.17 billion (2009: €2.39 billion).
The European embedded value, which is calculated based on international guidelines, represents the value of the insurance policy portfolio and is composed of the net assets for life, health and property/casualty insurance as well as the current value of future income from the existing life and health insurance portfolio. This calculation took into account the life and health insurance business of the UNIQA Group in Austria, Italy, Slovakia, Hungary, Poland, the Czech Republic and Germany. The European embedded value of the UNIQA Group was fully confirmed by B & W Deloitte GmbH, Cologne.
Reservations concerning statements about the future This announcement contains statements which refer to the future development of the UNIQA Group Austria. These statements are appraisals that are made based on all information available to us at the current point in time. Should the assumptions underlying this information not come to pass, the actual events may vary from the results currently expected. For this reason, we cannot accept liability for these statements.
Vienna, 25. May 2011