The PZU Group, 1H2019: EUR 2.8 billion in GWP and EUR 345 million net profit for the parent company

29 August 2019 — Daniela GHETU
The PZU Group has achieved in 1H2019 the highest net financial result attributed to the parent company for the first half of the last five years, of PLN 1.48 billion, while the group's efficiency ratios were better than planned.

Commenting on the Group's results in 1H, Pawel SUROWKA, President of the Board of PZU SA expressed his satisfaction with the financial results, but also stressed out that besides pure financial efficiency, PZU aims to position itself as a long-term partner of Poles in building a longer and more comfortable life, a goal sustained by the Group's scale and strong financial position. "The first half of 2019 it also showed us that we maintain a high level of ability to implement the announced changes, such as achieving subsequent stages of the digital transformation of PZU, or reaching millions of Poles with our message and offer," he added.

The main highlights of the PZU Group's development in 1H2019 are:

PLN 12 billion in premium for the first half of 2019 - stable business growth

  • Premiums written from property and other personal insurance in the second quarter of 2019: PLN 3.3 billion - stable level y / y excluding the long-term contract concluded in the second quarter of 2018
  • Acceleration of premium growth from non-motor retail insurance to 6% y / y in 2019 Q2, reflecting the good economic situation and strong competitive position of PZU
  • Increase in written premium in life insurance above the market
  • Acceleration of premium growth from individual protection insurance + 37% y / y in 2019 Q2; despite unfavorable market conditions for UFK, positive dynamics of annotation in the entire life segment for the first time in six quarters
  • Signed contracts for the management of Employee Capital Plans (PPK) with partners employing a total of over one hundred thousand employees
  • Increase in the number of PZU Zdrowie contracts by 31% y / y

PLN 1.5 billion of net profit for the parent for the first half of 2019

  • Result in the first half of 2019. at a level of 5% higher y / y, despite a significantly higher burden on the PZU Group banks for BFG costs in 2019.
  • Increase in net non-banking income y / y to PLN 622 million in Q2 2019, despite adverse weather conditions in May and June
  • Combined ratio in the non-life segment in Poland in the first half of 2019. at a low level of 89.2% and in Q2 2019. at 91.4%, which is better than expected in the strategy despite the accumulation of events in the non-traffic area
  • Operating margin in group and group insurance continued individually at a strategic level of 20% in the first half of 2019. and 23.2% in Q2 2019.
  • Very good and outperforming strategic ambitions investment result - return on the main portfolio 2.4 pp above risk-free rate in the first half and
    2.2 pp in the second quarter of 2019, while maintaining a conservative portfolio structure
  • Generated capital increase of 20.3% in the first half of 2019. and 23.9% cumulatively for the last four quarters

225% Solvency II - stability and security of operations

  • Raising S&P's perspective from stable to positive with rating maintained at A- with capital strength rating at AAA
  • Dividend approved by the General Meeting of Shareholders at PLN 2.80 per share (75% of consolidated net profit, 89% of unit profit, dividend yield of 6.8%)
  • Capital adequacy at a stable level, despite the increase in the scale of operations, Solvency II ratio at the end of Q1 2019. amounted to 225% after taking into account the recommended dividend payment
  • Decrease in the share of debt in the financing structure - repayment of bonds in EUR 850 million
  • A more conservative investment portfolio structure; greater share of treasury bonds, greater diversification of corporate exposures, lower share of MTM instruments

The PZU Group half-year report is available on the PZU website in the Investor Relations tab in the Periodic Reports section: https://www.pzu.pl/relacje-inwestorskie/raporty

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