- Profit on ordinary activities (EBT) rises by 15.5 per cent to €94.0 million
- Consolidated net profit up 37.5 per cent to €76.9 million
- Strong growth in premiums of 19.8 per cent to €2,039.5 million
- Administrative expenses reduced by 10.7 per cent
- EBT forecast for 2015 as a whole unchanged at between €425 million and €450 million
In the first three months of 2015, UNIQA Insurance Group AG (UNIQA Group) generated a profit on ordinary activities (EBT) of €94.0 million (+15.5 per cent; 1-3/2014: €81.4 million). Consolidated profit (after taxes and minority interests) amounted to €76.9 million (+37.5 per cent; 1-3/2014: €55.9 million). UNIQA achieved this growth in earnings despite having recognised write-downs of around €9 million on senior bonds guaranteed by the Federal State of Carinthia of Heta (formerly Hypo Alpe-Adria-Bank International) as a result of the debt moratorium issued by the Austrian Financial Market Authority (FMA) in March.
UNIQA CEO Andreas Brandstetter comments: “This growth and good start to 2015 was primarily due to further reduction of administrative expenses and a higher investment result. There was also a positive premium development, although we will not continue this in the same form in the coming quarters, since we are not aiming for any further growth in single premium business in life insurance in the current environment. Despite the historic challenge of a low-interest environment further exacerbated by the ECB’s bond purchases and a fragile economic development in parts of Europe, we are hold on to our ambitious outlook for earnings in 2015.”
Key Group figures for Q1 2015
The UNIQA Group’s premiums written, including the savings portion of unit- and index-linked life insurance, increased by 19.8 per cent to €2,039.5 million in the first three months (1-3/2014: €1,702.6 million). There was extremely strong growth in single premium business in life insurance (+129.9 per cent), which was chiefly attributable to very strong demand in bank-based sales in Austria and Italy. In total, premiums written in life insurance – including the savings portion of unit- and index-linked life insurance – rose by 48.5 per cent to €972.1 million (1-3/2014: €654.8 million). Premium income in the health insurance business area climbed by 4.6 per cent to €260.9 million (1-3/2014: €249.5 million), while in property and casualty insurance it grew by 1.0 per cent to €806.5 million (1-3/2014: €798.3 million).
Retained premiums earned in accordance with IFRS (i.e. not including the savings portion of unit- and index-linked life insurance) increased by 24.6 per cent to €1,707.7 million (1-3/2014: €1,370.9 million).
The UNIQA Group’s retained insurance benefits rose by 35.2 per cent to €1,485.9 million in the first three months of 2015 (1-3/2014: €1,098.9 million) due to the substantial increase in premiums in life insurance.
There was a significant reduction in administrative expenses (other operating expenses), which fell by 10.7 per cent to €90.1 million (1–3/2014: €101.0 million). Despite the strong premium growth, operating expenses for acquisition increased by only 8.1 per cent to €251.5 million (1-3/2014: €232.6 million). Overall, operating expenses less reinsurance commissions received grew by 3.0 per cent year on year to €335.7 million (1-3/2014: €325.8 million).
The Group cost ratio improved from 21.8 per cent to 18.4 per cent as a result of the extremely strong growth in premium income and the further reduction of administrative expenses. However, the cost ratio will increase again in the quarters ahead when premium growth levels off as expected and planned.
The combined ratio in property and casualty insurance rose from 97.9 per cent to 98.8 per cent. This was primarily due to generally increased costs with a higher number of small and medium-sized loss events and the increase in reserves for extraordinary loss events that was implemented as planned. By contrast, costs in property and casualty insurance continued to decline.
Net investment income of the UNIQA Group rose by 55.1 per cent from €152.9 million to €237.2 million in the first quarter of 2015. This was largely attributable to net evaluation gains on the investment portfolio and extraordinary income generated as part of the planned reduction of the property portfolio. The aim here is to optimise asset allocation across the strategic investment policy.
The investment portfolio of the UNIQA Group (including unit- and index-linked life insurance investments) increased by €1,086.8 million as against the end of the previous year to €30,299.5 million as at 31 March 2015 (31 December 2014: €29,212.7 million).
The UNIQA Group’s profit on ordinary activities (EBT) came to €94.0 million in the first three months, up 15.5 per cent on the previous year’s level (1-3/2014: €81.4 million).
Consolidated net profit (after taxes and minority interests) increased by 37.5 per cent to €76.9 million (1-3/2014: €55.9 million) as a result of relatively low tax expenses. Earnings per share amounted to €0.25 (1-3/2014: €0.18). The return on equity after taxes and minority interests rose to 9.7 per cent in the first quarter of 2015 (1-3/2014: 7.9 per cent).
Compared to the end of 2014, the UNIQA Group’s total equity climbed by 6.1 per cent to €3,292.1 million as at 31 March 2015 (31 December 2014: €3,102.4 million) due to increases in the market values of fixed-income securities in particular. The solvency ratio (Solvency I) rose to 302.2 per cent (31 December 2014: 295.4 per cent) as a result of this development.
The average number of employees at the UNIQA Group decreased to 13,966 (1-3/2014: 14,656) due to restructuring measures. 5,604 of these employees were employed in field sales and 8,362 in administration.
For 2015, the UNIQA Group has set itself the target of increasing its profit on ordinary activities to between €425 million and €450 million. This assumes that the capital market environment will be stable, that economic development will improve moderately and that losses caused by natural disasters will remain within a normal range.
This press release contains statements concerning UNIQA’s future development. These statements present estimates which were reached on the basis of all of the information available to us at the present time. If the assumptions on which they are based do not occur, the actual results may deviate from the results currently expected. As a result, no liability is accepted for this information.
The UNIQA Group is one of the leading insurance groups in its core markets of Austria and Central and Eastern Europe (CEE). 22,000 employees and exclusive sales partners serve more than 10 million customers in 19 countries. UNIQA is the second-largest insurance group in Austria with a market share of around 22%. UNIQA operates in 15 markets in the CEE growth region: Albania, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Hungary, Kosovo, Macedonia, Montenegro, Poland, Romania, Russia, Serbia, Slovakia, and Ukraine. The UNIQA Group also includes insurance companies in Italy, Switzerland and Liechtenstein.