29.08.2008 |
- Premium volume written +10.4% - Continued above-average growth in Eastern and South Eastern Europe at +60,0% - Cost and benefit ratios as well as technical situation further improved - Combined ratio (gross) in property and casualty insurance reduced to 90.0% - Capital market developments weigh down results - Forecast 2008 - the results on ordinary activities of €230 to 250 million corresponds to the previous year's results excluding the one-time effect from the STRABAG deal - Medium-term results forecast for 2010 of €430 million remains unchanged due to the good technical insurance developments and under the assumption of an improving capital market situation
UNIQA CEO Dr. Konstantin Klien on developments in the 1st half of 2008: "With a continuation of significant premium growth exceeding 10% and with cost and benefit ratios falling once again, we have achieved a significant improvement in the technical situation. The combined ratio in property and casualty insurance was reduced by more than eight percentage points to 90.0%. On the other hand, the falling stock markets and the interest increase in the first six months of the current year have led to a decrease in the financial result.
In total, an improved technical situation and lower return on capital in the 1st half of 2008 has resulted in an 18.5% reduction in profit to €110 million (1-6/2007: €135 million).
Assuming a stabilisation of the capital markets and no exceptional negative underwriting effects, we expect a profit for the full year of 2008 in the range of €230 to 250 million. Despite the drag from capital markets, this year's profit will be close to last year's, after adjusting for the STRABAG effect. Last year's profit of € 340 million included roughly €110 million of one-time effects from the STRABAG deal. The pleasing growth and positive development of the actuarial situation allows us to maintain our medium-term profit planning for 2010 of €430 million, under the assumption that the capital market situation improves in comparison to 2007/08."
In the first six months of the current year, the UNIQA Group succeeded in increasing the consolidated premium volume written (including the savings portion of the unit- and index-linked life insurance) by 10.4% to €3,003 million (1-6/2007: €2,719 million).
The UNIQA Group experienced massive growth in Eastern and South Eastern Europe in particular, with no significant consolidation effects and a rise in premiums by 60.0% to €603 million (1-6/2007: €377 million). Market share was increased in almost all countries, further improving the basis for profitable developments this growth region. The life insurance business and the success in bank sales have contributed in particular to a further strengthening of the growth dynamics. Due to the above-average premium increases in Eastern and South Eastern Europe, the UNIQA Group has also significantly increased its level of internationalisation to 37.0%. Eastern and South Eastern Europe alone contributed already 20.1% in the 1st half of 2008 (1-6/2007: 13.9%).
In line with market developments, the business volume in Western Europe remained at the level of the previous year during the first six months of 2008, declining only slightly by 0.3% to €509 million (1-6/2007: € 510 million). The total international share of the business was already 37.0% in the first half of 2008 (1-6/2007: 32.6%).
Despite heavy competition, it was possible to improve the premium volume in the core market of Austria by 3.2% to €1,891 million (1-6/2007: €1,832 million).
From a sector perspective, life insurance achieved the strongest growth at 16.9% to reach €1,224 million (1-6/2007: €1,047 million). In property and casualty insurance, the premium volume increased by 7.5% to €1,302 million (1-6/2007: €1,211 million). The premiums written in health insurance rose by 3.3% to €476 million (1-6:2007: €461 million).
Simultaneous with the premium increases, it was also possible to keep the growth of costs and benefits significantly below the premiums in all sectors. In the course of this development, the benefit ratio across all sectors was lowered by more than 10 percentage points to 65.2% (1-6/2007: 75.6%). The cost ratio was also reduced across all sectors and the Group-wide figure after the first six months of this year was 21.8% (1-6/2007: 22.7%). Despite the storms of Paula and Emma, the combined ratio (gross) in property and casualty insurance was significantly reduced in all regions and was at 90.0% Group-wide after the first two quarters (1-6/2007: 98.1%). The technical results (before investment income) in the non-life sectors also improved significantly - in property and casualty to €61 million (1-6/2007: €-13 million) and in health insurance to €-14 million (1-6/2007: €-26 million).
The investments of the UNIQA Group (incl. land and buildings used by the Group, real estate held as financial investments, shares in associated companies and the investments of unit- and index-linked life insurance) as at 30 June 2008 remained stable compared with the same point in 2007 at a total of €21,753 million (30.6.2007: €21,770 million). The net investment income declined in the first six months of 2008 by 57.3% to €195 million (1-6/2007: €455 million). Capital investment results in the 1st half of the year were negatively influenced primarily by the falling stock markets as a result of the global financial market crises as well as the rise in interest rates and the spread increase in the area of the fixed-income portfolio.
Despite the good successes in the core insurance business, the profit (before taxes) declined by 18.5% to €110 million (1-6/2007: €135 million) due to reduced income from capital investments. At €109 million (1-6/2007: €113 million), the net profit (after taxes) was only 3.5% below the value of the previous year.
Outlook The takeover of 100% of the share capital of the Romanian company UNITA was fixed at the end of June with a share purchase agreement - the closing is expected in autumn of this year after all necessary regulatory approvals. Because the conditions for a majority takeover of ASTRA Versicherung were not fulfilled, there are no more legal obligations in this regard. The shareholding in the Romanian insurance company ASTRA remains at 27%.
Assuming a stabilisation of the capital market situation and no negative underwriting effects, UNIQA aspires for a profit on ordinary activities in the vicinity of €230 to 250 million for the entire year of 2008. The lower limit of this range corresponds to the profit from 2007 after exclusion of the one-time effects of €110 million from the STRABAG deal (unadjusted: € 340 million).
Based on the very good development of the technical results, the encouraging growth and the assumption of a capital market situation that improves compared with 2007/08, we are still aiming for a medium-term profit target for 2010 of €430 million.
Reservation for future statements This notification contains statements relating to the future development of UNIQA Group Austria. These statements represent estimates made on the basis of information available to us at the current time. If the assumptions on which they are based are not fulfilled, the actual results may vary from those currently expected. Therefore we cannot accept liability for these statements.
Vienna, 29. August 2008