fy results 2014 - press presentation
TRANSCRIPT
Insurance
performance
Insurance net profit of EUR 737 million (+13%)
Inflow @ 100% of EUR 25.8 billion (+11%)
Inflows Asia > EUR 11 billion
Group combined ratio at 99.6%* (vs.98.3%)
Main messages
Periodic financial Information I FY 14 Results I 12 February 2015 1
* Consolidated entities only
12 49
438
533
204
154
FY 13 FY 14
Other Life Non-Life
1 24
126 91
30 43
Q4 13 Q4 14
Other Life Non-Life
Strong Life results more than offset lower Non-Life
In EUR million
Insurance profit + 13%
Periodic financial Information I FY 14 Results I 12 February 2015 2
654 737 157 158
Q4 FULL YEAR
Insurance net result by segment All segments improve except for Continental Europe
Belgium
UK
CEU
Asia
Total Ageas
Life Non-Life
Life Non-Life Other
Life Non-Life
Life Non-Life
Life Non-Life Other
1249
1249
274
336
(2) (3)
44 45
122 156
438
533 61
56
90 71
32 11
21
16
204
154
335
392
100
117
77 56
142 172
654
737
FY 13 FY 14 FY 13 FY 14 FY 13 FY 14 FY 13 FY 14 FY 13 FY 14
In EUR million
Periodic financial Information I FY 14 Results I 12 February 2015 3
BELGIUM
UK
CEU
ASIA
+17% increase in net profit
COR 101.2%: June hailstorm and poor performance in Third Party Liability
Acquisition of Fidea Group Life portfolio
Sale of Ageas Protect (Life)
Total Gain EUR 33 million
Upstream of EUR 193 million to General Account
Buy outs in Portugal and Italy
Strong inflows in Luxembourg (wealth management)
Reserve strengthening in Turkey
> EUR 11 billion inflows (at 100%)
Number of agents and brokers in China: 140,000
Regular premiums up 42%
Main messages per segment
Periodic financial Information I FY 14 Results I 12 February 2015 4
Belgium
UK
CEU
Asia
Total Ageas
Life Non-Life
Life Non-Life
Life Non-Life
Life Non-Life
Life Non-Life
Inflows at 100% Strong Life growth in China, Thailand and Luxembourg
In EUR million
Periodic financial Information I FY 14 Results I 12 February 2015 5
Insurance
performance
Group result
Insurance net profit of EUR 737 million (+13%)
Inflow @ 100% of EUR 25.8 billion (+11%)
Inflows Asia > EUR 11 billion
Group combined ratio at 99.6%* (vs.98.3%)
Group net profit of EUR 476 million (-16%)
General Account net result of EUR (261) million, incl. RPN(i) & FortisEffect
provision
Main messages
Periodic financial Information I FY 14 Results I 12 February 2015 6
* Consolidated entities only
Insurance
performance
Group result
Balance sheet
Insurance net profit of EUR 737 million (+13%)
Inflow @ 100% of EUR 25.8 billion (+11%)
Inflows Asia > EUR 11 billion
Group combined ratio at 99.6%* (vs.98.3%)
Group net profit of EUR 476 million (-16%)
General Account net result of EUR (261) million, incl. RPN(i) & FortisEffect
provision
Shareholders’ equity at EUR 10.2 billion or EUR 46.60 per share
Insurance solvency at 206%, Group solvency at 210%
Net cash position General Account at EUR 1.6 billion (vs. EUR 1.9
billion)
Main messages
Periodic financial Information I FY 14 Results I 12 February 2015 7
* Consolidated entities only
Periodic financial Information I FY 14 Results I 12 February 2015 8
Disciplined cash upstream from operating companies EUR 725 million upstream over 2014
All segments contributing
Upstream more than covering dividend & holding costs
Extra-ordinary dividend in Continental Europe as part of active capital
restructuring or linked to M&A
In EUR million
168
64
Portugal132
Portugal61
Portugal115
France 2
France30
Italy 5
Luxembourg 4
Turkey 7
Malaysia40
Thailand 8
Hong Kong88
China 2
150
91
115
138
div div norm div div/caprestr
div/M&A div
Belgium UK Continental Europe Asia
Mix of regular &
exceptional upstream
356
Insurance
performance
Group result
Balance sheet
Proposed dividend
Insurance net profit of EUR 737 million (+13%)
Inflow @ 100% of EUR 25.8 billion (+11%)
Inflows Asia > EUR 11 billion
Group combined ratio at 99.6%* (vs.98.3%)
Group net profit of EUR 476 million (-16%)
General Account net result of EUR (261) million, incl. RPN(i) & FortisEffect
provision
Shareholders’ equity at EUR 10.2 billion or EUR 46.60 per share
Insurance solvency at 206%, Group solvency at 210%
Net cash position General Account at EUR 1.6 billion (vs. EUR 1.9
billion)
Gross EUR 1.55 per share paid in cash (+11%)
Main messages Ageas reports higher Insurance profit & proposes to raise dividend to EUR1.55
Periodic financial Information I FY 14 Results I 12 February 2015 9
* Consolidated entities only
Periodic financial Information I FY 14 Results I 12 February 2015 10
Only 2 alternative uses for General Account net cash withheld Balance clearly tipping towards return to shareholders
1. Invest in Businesses
Organic growth
Selective acquisitions
Create new partnerships
2. Return to shareholders
Dividend payment
Share buy-back
≈ EUR 2.7 billion
≈ EUR 1.2 billion cash dividend over ‘09, ’10, ’11, ‘12 & ‘13
EUR 650 million share buy-backs launched ‘11 , ‘12 & ’13
EUR 222 million capital reduction from proceeds of BNPP
Call Option & RPI
EUR 330 million cash dividend over 2014
EUR 250 million share buy-back 2014-’15
≈ EUR 1.3 billion from net cash
on top of retained earnings ≈ EUR 600 million UK (Tesco, Kwik Fit IS,
Castle Cover, Groupama)
≈ EUR 200 million CE (Italy, Turkey)
≈ EUR 100 million Asia (India, HK, China)
≈ EUR 220 million Asia (Taiping Life)
≈ EUR 120 million Portugal
≈ EUR 40 million Italy
Ageas proposes a gross cash dividend of EUR 1.55 In line with 40-50% dividend pay-out, 11% up on 2013
456391
(313)
624 654
737
188 197 188
270309 331.7
2009 2010 2011 2012 2013 2014
Insurance result
Dividend
To be approved at
AGM
In EUR million
AGM: 29 April Brussels
Ex-dividend date: 6 May
Payment dividend : 8 May
Total distributed
amount +70% since
2009
* calculation based on day before ex-dividend date closing price – 2014 yield based on 31/12/2014 share price
Periodic financial Information I FY 14 Results I 12 February 2015 11
gross amount / share 0.80 0.80 0.80 1.20 1.40 1.55
pay-out ratio 41% 50% - 43% 47% 45%
dividend yield* 2.9% 3.8% 4.7% 4.5% 4.4% 5.3%
Periodic financial Information I FY 14 Results I 12 February 2015 12
Status on Vision 2015 targets (vs. FY 12)
FY 14 at 67/33 (vs. 67/33)
Acquisitions in Non-Life in Portugal and Italy / Sales Life activity in UK
Strong Life inflow growth in emerging markets (for the first time > EUR10 billion)
FY 14 at 99.6% (vs. 99,1%)
2.3% impact of adverse weather in UK and Belgium
FY 14 at 17.5% (vs. 12.1%)
Disciplined capital management in Europe & strong increase in Asia
FY 14 at 8.8% (vs. 8.7%)
ROE exclusive Unrealised Gains and Losses on fixed income portfolio at 11.4% (vs. 10.7%)
Takeaways
Solid Insurance result – good underlying
progress in most activities
Some important areas of improvement remain – getting full attention
Strategic progress made – not visible in
Vision 2015 targets
Increased dividend – commitment to share
progress with shareholders
Investor Day on Solvency II & “Beyond ‘15”
Conclusions: positive trend continued
Periodic financial Information I FY 14 Results I 12 February 2015 13
Periodic financial Information I FY 14 Results I 12 February 2015 14
Insurance Solvency Find out more on Solvency II & “Beyond ‘15” @ Investor Day 2015
28 September 2015
Andaz hotel - London
Periodic financial Information I FY 14 Results I 12 February 2015 15
Disclaimer
Certain of the statements contained herein are statements of
future expectations and other forward-looking statements that are
based on management's current views and assumptions and
involve known and unknown risks and uncertainties that could
cause actual results, performance or events to differ materially
from those expressed or implied in such statements. Future actual
results, performance or events may differ materially from those in
such statements due to, without limitation, (i) general economic
conditions, including in particular economic conditions in Ageas’s
core markets, (ii) performance of financial markets, (iii) the
frequency and severity of insured loss events, (iv) mortality and
morbidity levels and trends, (v) persistency levels, (vi) interest rate
levels, (vii) currency exchange rates, (viii) increasing levels of
competition, (ix) changes in laws and regulations, including
monetary convergence and the Economic and Monetary Union, (x)
changes in the policies of central banks and/or foreign
governments and (xi) general competitive factors, in each case on
a global, regional and/or national basis. In addition, the financial
information contained in this presentation, including the pro forma
information contained herein, is unaudited and is provided for
illustrative purposes only. It does not purport to be indicative of
what the actual results of operations or financial condition of
Ageas and its subsidiaries would have been had these events
occurred or transactions been consummated on or as of the dates
indicated, nor does it purport to be indicative of the results of
operations or financial condition that may be achieved in the
future.
FY 13 FY 14FY 13 FY 14
Periodic financial Information I FY 14 Results I 12 February 2015 17
Net result: solid full year performance, Q4 lower Life result In EUR million In EUR
billion
Operating margin Guaranteed: well within target range
Non-Life combined ratio: June hailstorm & poor TPL performance
Inflow: sales in Guaranteed Savings up despite lower rates
Life Technical liabilities up 8%, incl. acquisition Fidea Group Life
In EUR billion
Belgium : Headlines Strong FY net result & Non-Life strong second half year performance
**
Operating margin Unit-Linked: out of target range
In % avg technical liabilities In % avg technical liabilities
FY 13 FY 14Life Non-Life
84
54
4
16
Q4 13 Q4 14
4.1 4.0
1.9 1.9
6.0 5.9
FY 13 FY 14
Life Non-Life
1.1 1.1
0.4 0.4
1.5 1.5
Q4 13 Q4 14
Q4 13 Q4 14
In % NEP
Q4 13 Q4 14FY 13 FY 14Q4 13 Q4 14
99.9% 101.2% 106.3% 99.2%
0.23%0.34%
0.30%0.41%
0.56%1.03%0.87%0.89%
274336
61
56
335392
88
70
53.2 56.1 57.6
FY 13 9M 14 FY 14
In EUR million
United Kingdom: Headlines Steady inflows; recovery from climatic events in the first quarter
In EUR billion
In % NEP In EUR million
* incl. non-consolidated partnerships @ 100%
18 Periodic financial Information I FY 14 Results I 12 February 2015
54
89
Q4 13 Q4 14
0.1 0.1
2.2 2.3
2.32.4
FY 13 FY 14
Life Non-Life
0.0 0.00.5 0.5
0.5 0.5
Q4 13 Q4 14(2)
(3)12
49
90
71
100
117
FY 13 FY 14
Life Other Non-Life
(0) (5)1
2413
19
14
38
Q4 13 Q4 14
FY 13 FY 14
97.8% 99.8%
Q4 13 Q4 14
100.5% 101.4%
FY 13 FY 14
235 298
Recovery from impact Q1 weather events – positive one-offs in Other
Inflow* up 5%, flat @ constant FX
Non-Life combined ratio: sub 100% despite Motor large losses
Other Income includes one-off benefits
Sale of UK Protect
Sale closed in Q4 2014
Total Gain booked
EUR 21 million in UK Other
result
EUR 12 million in General
Account
Net cash General Account
up EUR 193 million
Net profit impacted by Turkey: reserves strengthening vs. one-off FY 13 In EUR million In EUR billion
Non-Life combined ratio improved thanks to lower Motor claims
227% 210% 207%
Inflow* up with strong sales in Luxembourg
In EUR billion
Continental Europe: Headlines Net result down on Turkey – Strong inflow growth in Luxembourg
**
Operating margin Guaranteed: lower net U/W not offset by investment margin
Periodic financial Information I FY 14 Results I 12 February 2015 19
Life Technical liabilities in line with growing volumes
In % avg technical liabilities
Operating margin Unit-Linked: lower fee income in Portugal In % avg technical liabilities
44 45
32
11
77
56
FY 13 FY 14
Life Non-Life
8 10
6 4
14 13
Q4 13 Q4 14
4.14.6
1.11.1
5.25.6
FY 13 FY 14
Life Non-Life
1.2 1.1
0.30.3
1.5
1.3
Q4 13 Q4 14
FY 13 FY 14 Q4 13 Q4 14 FY 13 FY 14 Q4 13 Q4 14 FY 13 FY 14 Q4 13 Q4 14
93.7% 92.1% 91.4% 96.3%0.91% 0.70% 0.94% 0.73%
0.47%
0.10%0.20%
0.08%
In % NEP
* incl. non-consolidated partnerships @ 100%
13.9 14.2 14.5
15.0 16.9 17.3
28.931.1 31.8
FY 13 9M 14 FY 14
Conso Non-conso
21
16
FY 13 FY 14
Life Non-Life
21 26
64
28 30
Q4 13 Q4 14
0.8
0.8
9.8
11.9
FY 13 FY 14
Life Non-Life
Net result: Strong results in China & Thailand In EUR million In EUR billion
Non-Life: Combined ratio continued improvement
Inflow growth fuelled by China & Thailand
Life Technical liabilities up across all entities In EUR
billion
Asia: Headlines New business & renewals support excellent performance China & Thailand
Periodic financial Information I FY 14 Results I 12 February 2015 20
**
In % avg technical liabilities In EUR million
Life operating margin Hong Kong: Increased net underwriting result
Result non-conso partnerships: marked by China & Thailand
Q4 13 Q4 14FY 13 FY 14Q4 13 Q4 14FY 13 FY 14
95.4%
89.9%
97.4%
89.9%
1.95% 1.90% 3.59% 2.58%
In % NEP
* incl. non-consolidated partnerships @ 100%
172
142
120
153
100
137
9.1 11.1
21
16
FY 13 FY 14
Life Non-Life
2.0 2.3 2.8
25.9
33.1 34.9
27.9
35.437.7
FY 13 9M 14 FY 14
conso non-conso
122
156
35 33
64
41
37
Q4 13 Q4 14
1.7
2.7
0.2
0.2
1.9
2.9
Q4 13 Q4 14
Periodic financial Information I FY 14 Results I 12 February 2015 21
Status on various legal procedures Civil proceeding initiated by (associations of) shareholders
2008 2007
September - October 08 Split up of Fortis Group, spread over 2 WE’s
May – September 07 Press release re bid on Abillion AMRO Communication Q2 figures Capital increase, Prospectus, Subprime
January – June 08 Press release on subprime & solvency Communication re solvency & EC remedies
BE - 1 professional investor re damages following rights issue; exchange of written arguments
Enterprise Court (Ondernemingskamer) re certain facts relating to 2007-2008, Final judgement 06/12/13 mainly in favour plaintiffs
Stichting Investor Claims Against Fortis (SICAF) against Ageas ML & billionPPF; 2° proceeding also against board members & executives, awaiting ruling preliminary procedural questions
Deminor against ageas & 2 banks; interim judgment 28/4/14 ruling +/- 25% claimants not eligible; exchange of written arguments ongoing
BE – 2 claimants against ageas: awaiting decision consolidation with Deminor
Mr Lenssens representing several claimants against ageas, 1 bank, Belgian state & several executives, suspended pending criminal proceedings
Stichting FortisEffect against ageas & Dutch state; Judgement partly in favour of plaintiffs, Supreme appeal filed
NL - 1 shareholder claiming damages referring to FortisEffect judgment
Mr.Modrikamen against ageas, Belgian state & 2 banks; Interim judgement 05/11/14 ruling +/- 50% claimants not eligible
Mr. Arnauts representing several claimants against ageas & 2 banks; suspended pending criminal proceedings
VEB collective action against ageas, former directors / executives & banks; exchange of written arguments
Mr. Bos representing 7 shareholders against ageas, board members & executive; 1° instance mainly in favour of claimants, appeal filed
2 separate proceedings - Mr Meijer representing in each case 1 claimant against ageas, awaiting decision consolidation SICAF
Periodic financial Information I FY 14 Results I 12 February 2015 22
Status on various legal procedures Administrative & criminal proceedings*
AFM I : final - fine imposed
FSMA: appeal filed before Court of Appeal
2008 2007
May/June 08
Communication re solvency & EC
remedies
September -
October 08
Rescue operations & Split
up of Fortis Group,
spread over 2 WE’s
August 07
Communication Q2 figures
AFM II : final - acquittal
September 07
Capital increase, Prospectus,
Communication about subprime
exposure
May 07
Press release re bid on Abillion AMRO
January 08
Press release on subprime & solvency
Criminal Investigation: referral to court asked for 7 individuals - additional investigation ongoing
Administrative proceedings
Criminal proceedings
* For a complete overview of all legal procedures, please check the contingent liabilities in the Annual Report
Periodic financial Information I FY 14 Results I 12 February 2015 23
Best estimate of timings as of to date Impossible to provide accurate timing for next steps
2015 2016
First instance
Pleadings
VEB
BE – 1 professional investor
Mr.Modrikamen Deminor
Judgement on the merits
VEB
BE – 1 professional investor
Mr.Modrikamen
Appeal
Pleadings FSMA fine
Judgement preliminary matters Mr.Bos
Judgement on the merits FSMA fine
Supreme Court
Pleadings
Periodic financial Information I FY 14 Results I 12 February 2015 24
Shareholders structure
Based on number of shares as at 31 December 2013
Ageas5.04%
Ping An
BlackRock, Inc.
Schroders
Franklin Mutual Advisers
Identified retail investors
19%
Identified institutional investors
36%
Other investors21%
Based upon press release 9 February 2015
Based upon the number of shares mentioned in the notification received 6 May 2013
Based upon the number of shares mentioned in the notification received 2 June 2014
Based upon the number of shares mentioned in the notification received 16 January 2015
Based upon the number of shares mentioned in the notification received 22 July 2013
Estimate by
Estimate by
Ageas
Ping An
BlackRock, Inc.
Schroders
Franklin Mutual Advisers
Identified retail investors
Identified institutional investors