UNIQA: 6.6% growth in the CEE markets, a driver for the positive earnings' trend of the Group

4 September 2012 — Daniela GHETU
uniqa3In the first half of 2012, UNIQA Group increased its profit on ordinary activities by 43.2%, to EUR 106.5 million, while the consolidated profit improved by 67.1% y-o-y to EUR 57.3 million. Doubling the number to customers by 2020, to 15 million and improving its results by up to EUR 400 million until 2015 as against 2010 are the current targets of the Group. "We are on track. However, we must press ahead with our efforts, as the economic conditions are unlikely to provide any tailwind in the second half of the year", said Andreas BRANDSTETTER, CEO of UNIQA .

The positive earnings development in the first half of 2012 are based on a solid core operating business: Recurring premiums - including the savings portions of unit- and index-linked life insurance - rose by 0.8% to EUR 2,583.0 million and in the growth markets in Central and Eastern Europe by 6.6% to EUR 585.3 million.

Total premiums written - including the savings portions of unit- and index-linked life insurance - fell by 2.4% to EUR 2,856.4 million, primarily due to the industry-wide downturn in single premiums in life insurance across all markets, particularly in Hungary and Italy. In Poland, UNIQA is consciously reducing single premium business and is promoting more profitable business areas which also tie up less risk capital.

The loss ratio across all lines increased by 2.4 pp to 73.3%. The loss ratio after reinsurance in property and casualty insurance improved slightly to 67.5%. The loss ratio in health insurance increased by 0.2 percentage points to 85.8%. The loss ratio in life insurance increased to 74.3%.

Operating expenses (including reinsurance commission and profit shares from reinsurance business) fell by 5.6% to EUR 619.6 million. While acquisition expenses (sales costs) increased by 0.1% to EUR 447.8 million, other operating expenses excluding reinsurance commission received (administration costs) decreased by 17.7% to EUR 171.8 million.

The Group cost ratio after reinsurance decreased to 23.9% due to the decline in premiums written.

The combined ratio after reinsurance in property and casualty insurance rose marginally to 100.7% due to the increased number of major claims. Before taking reinsurance into account, the combined ratio rose slightly to 97.5%, and remained under the 100 percent threshold.

Investments including unit- and index-linked life insurance increased as of 30 June 2012 compared with 31 December 2011 by EUR250.2 million to EUR24,851.3 million (31 December 2011: EUR24,601.1 million). Net investment income rose by 51.8% to EUR403.4 million (1-6/2011: EUR256.8 million). The total equity of UNIQA Group climbed in the first six months 2012 by 14.3% compared with 31 December 2011 to EUR1,251.8 million (31 December 2011: EUR1,095.6 million).

UNIQA Group significantly improved its risk position and reduced its portfolio of government securities in the PIIGS countries (Portugal, Italy, Ireland, Greece and Spain) by 45% in the 1st half year 2012: From a nominal value of EUR2,045 million as of 31 December 2011 to a value of EUR1,122 million. The exposure to Greece and Portugal was sold off completely. The largest part of the remaining portfolio consists of investments in Italy (EUR727 million), which have a direct relation to UNIQA's Italian life insurance business.

Profit on ordinary activities (EBT) increased by 43.2% to EUR 106.5 million. Consolidated profit (after taxes and minority interests) improved by 67.1% y-o-y to EUR57.3 million (1-6/2011: EUR34.3 million). This figure includes the result from discontinued operations due to the disposal of Mannheimer Group in the amount of EUR 8.9 million.

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