SAVA Re Group, FY2016: Profit before tax of EUR 40.7 million, 1.4% up y-o-y

The Slovenian SAVA Re Group closed the year 2016 with a profit before tax of EUR 40.7 million, an 1.4% y-o-y improvement, mainly due to the underwriting result of international reinsurance business. The after-tax profit was EUR 32.9 million, which is 1.3% below the y-o-y figure because of tax effects. The Group also reached a major goal by merging all its EU-based insurers.

The profit of non-life business in Slovenia was lower, mainly due to the hailstorm event that hit the portfolio of Zavarovalnica SAVA. At the SAVA Re Group level, this event had a negative impact of EUR 6 million on profits (EUR 5 million impact on incurred claims and reinstatement premium of EUR 1 million). Despite this catastrophic event, the profit generated by this segment was offset by other improvements and was only EUR 3 million below the prior year figure. Furthermore, the Group achieved a better result with international non-life insurance business, mainly as a result of an improved net investment income (2016: EUR 2.3 million; 2015: EUR 1.6 million). The life insurance business altogether produced a marginally lower profit than in 2015 (2016: EUR 10.3 million; 2015: EUR 12.1 million).

Group GWP in 2016 amounted to EUR 490.2 million, up by 0.8% y-o-y. This growth was driven by the non-life insurance business, which grew by EUR 5.8 million (2.3%) in the Slovenian insurance market and by EUR 3.1 million (5.9%) in the markets outside Slovenia. However, there was a decline in international reinsurance premiums but with an increase in the profitability of the operating segment. The Group's life insurance premiums continued to decline modestly in the Slovenian insurance market (-0.2%), but grew by 10.9% on international insurance markets.

In 2016 the Group's net combined ratio (excluding the effect of exchange rate differences) improved by 0.3% percentage points to 94.6%. The Company estimates this movement as very good, especially in view of the realised catastrophic event in 2016 and the larger cost burden due to the merger of its EU-based insurers.

For the year 2016, the Group generated a return on equity of 11.3%, which is better than the Group's long-term goal. The profits earned will allow the Group to follow its dividend policy and planned increase in regular dividend per share.



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