First quarter 2015 results: SCOR delivers high quality net income of EUR 175 million and annualized ROE of 12.1%
(Thomson Reuters ONE) -
Press Release
6 May 2015 - N° 15
Contact details
Marie-Laurence Bouchon
Group Head of Communications
+33 (0)1 58 44 76 10
mbouchon(at)scor.com
Bertrand Bougon
Head of Investor Relations
& Rating Agencies
+33 (0)1 58 44 71 68
bbougon(at)scor.com
www.scor.com
Twitter: (at)SCOR_SE
First quarter 2015 results
SCOR delivers high quality net income of
EUR 175 million and annualized ROE of 12.1%
SCOR delivers a strong start to the year, thanks to the rigorous implementation
of its strategic plan and the profitable growth of both its Life and P&C
business engines. SCOR is on track to achieve the targets set out in its
strategic plan "Optimal Dynamics".
* Gross written premiums reach EUR 3,124 million, up 17.0% at current exchange
rates compared to 2014 (+5.1% at constant exchange rates). This significant
growth is driven by the contribution of the two business engines, SCOR
Global P&C and SCOR Global Life:
* SCOR Global P&C gross written premiums increase by 16.3% at current
exchange rates (+5.2% at constant exchange rates) to EUR 1,398 million;
* SCOR Global Life gross written premiums reach
EUR 1,726 million, up by 17.7% at current exchange rates (+5.0% at
constant exchange rates).
* SCOR Global P&C delivers strong Q1 2015 technical profitability with a net
combined ratio of 89.1%, compared to 88.9% in Q1 2014, in an environment of
low natural catastrophe losses.
* SCOR Global Life's technical margin stands at 7.2% for the first three
months of 2015, compared to 7.3% for the same period in 2014.
* As announced today, SCOR Global Life's Market Consistent Embedded Value
(MCEV) reaches EUR 4.7 billion in 2014 (EUR 25.50 per share), up 6.2%
compared to 2013.
* SCOR Global Investments achieves an enhanced 3.5% return on invested assets
thanks to its active portfolio management, in an historically low yield
environment.
* Group net income reaches EUR 175 million in the first quarter of 2015, an
increase of 30% compared to 2014. The annualized Return on equity (ROE)
stands at 12.1%[1].
* Shareholders' equity increases by 12% over the quarter to reach EUR 6,415
million at 31 March 2015, compared to EUR 5,729 million at 31 December
2014, translating into a book value per share of EUR 34.35 at 31 March
2015, compared to EUR 30.60 at 31 December 2014. The strong net income
contribution and very strong foreign exchange impact (of around EUR 414
million) were the main drivers for the increase.
* SCOR's 2015 solvency ratio[2], as defined by the 2014 internal model, stands
at 224%, marginally above the optimal range as defined in the "Optimal
Dynamics" plan.
* SCOR's financial leverage decreased to 20.8% at 31 March 2015, compared to
23.1% at 31 December 2014.
SCOR Group Q1 2015 key financial details:
+---------------------------------+
| First quarter 2015 results |
| |
In EUR millions (rounded, at current | Q1 2015 Q1 2014 Variation|
exchange rates) |(Unaudited) (Unaudited) |
+--------------------------------------------+---------------------------------+
|Gross written premiums | 3,124 2,669 17.0% |
+--------------------------------------------+---------------------------------+
|Group cost ratio | 5.15% 4.98% 0.17 pts |
+--------------------------------------------+---------------------------------+
|Net return on invested assets | 3.5% 2.6% 0.9 pts |
+--------------------------------------------+---------------------------------+
| Annualized ROE(*) | 12.1% 11.2% 0.9 pts |
+--------------------------------------------+---------------------------------+
| Net income(**) | 175 135 29.6% |
+--------------------------------------------+---------------------------------+
| Shareholders' equity | 6,415 5,162 24.3% |
+--------------------------------------------+---------------------------------+
| P&C Combined ratio | 89.1% 88.9% 0.2 pts |
+--------------------------------------------+---------------------------------+
| Life technical margin | 7.2% 7.3% -0.1 pt |
+--------------------------------------------+---------------------------------+
(*) The ROE calculation method was adjusted to take into account material
foreign exchange rate movements that do not occur evenly throughout the
reporting period. A daily weighted average is applied for the currency or
currencies that experienced such movements and a simple weighted average is
applied for the other currencies. (**) Consolidated net income, Group share.
Denis Kessler, Chairman & CEO of SCOR, comments: "The very high quality results
recorded by SCOR in the first quarter of 2015 confirm the relevance of the
strategic orientations chosen. The Group's business continued to expand in the
first quarter, delivering strong technical results for both SCOR Global Life and
SCOR Global P&C. With the positive P&C renewals in January and April, the
expansion of SCOR Global Life and the continuation of SCOR Global Investments'
active asset management policy, the Group once again demonstrates that its
business model enables it to achieve its profitability and solvency objectives,
as set out in the "Optimal Dynamics" plan."
In the first quarter of 2015, SCOR Global P&C delivers excellent technical
profitability, with a net combined ratio of 89.1%
SCOR Global P&C key figures:
+---------------------------------+
| First quarter 2015 results |
| |
In EUR millions (rounded, at current | Q1 2015 Q1 2014 Variation|
exchange rates) |(Unaudited) (Unaudited) |
+--------------------------------------------+---------------------------------+
|Gross written premiums | 1,398 1,202 16.3% |
+--------------------------------------------+---------------------------------+
|Combined ratio | 89.1% 88.9% 0.2 pts |
+--------------------------------------------+---------------------------------+
SCOR Global P&C posts gross written premium growth of +16.3% at current exchange
rates (+5.2% at constant exchange rates) to EUR 1,398 million in the first three
months of 2015, driven by USD-based growth, particularly with Global Clients and
thanks to the Client Focus Initiative in the US market, and with expected
profitability at target.
In the first three months of 2015, SCOR Global P&C records excellent technical
profitability with a net combined ratio of 89.1%, driven by:
* an excellent net attritional loss ratio of 56.1%, with a year-on-year
improvement of 1.0 pt resulting from active portfolio management;
* a low level of nat cat losses of 1.7%, with Storm Niklas being the only
material event and accounting for EUR 20 million, mostly from Germany;
* a commission ratio at 24.7%, with the change in the portfolio mix towards
proportional business contributing to about two thirds of the year-on-year
increase.
The normalized net combined ratio (with a natural catastrophe budget of 7%)
stands at 94.4%. For the full year, SCOR Global P&C reaffirms its normalized net
combined ratio assumption of 94%.
Confirming the market trends observed in January in terms of competitive
environment, cedants' reinsurance purchase drivers, price changes and terms &
conditions, SCOR Global P&C delivered premium growth of 5.8% at constant
exchange rates at its 1 April 2015 renewals[3] while limiting the decrease in
prices to -1.2%.
For the full year 2015, SCOR Global P&C expects to achieve approximately EUR
5.3 billion in gross written premiums, as stated in the press release relating
to the January 2015 renewals[4].
SCOR Global Life continues to combine strong technical performance with steady
franchise growth in the first quarter of 2015
SCOR Global Life key figures:
+---------------------------------+
| First quarter 2015 results |
| |
In EUR millions (rounded, at current | Q1 2015 Q1 2014 Variation|
exchange rates) |(Unaudited) (Unaudited) |
+--------------------------------------------+---------------------------------+
| Gross written premiums | 1,726 1,467 17.7% |
+--------------------------------------------+---------------------------------+
| Life technical margin | 7.2% 7.3% -0.1 pts |
+--------------------------------------------+---------------------------------+
SCOR Global Life gross written premiums stand at EUR 1,726 million in the first
quarter of 2015, up 17.7% at current exchange rates compared to the same period
last year (+5.0% at constant exchange rates), resulting from:
* The first significant Longevity transaction underwritten in the Canadian
market[5], demonstrating SCOR Global Life's ability to leverage its success
in the UK longevity market;
* Expansion of SCOR Global Life's footprint in Asia, both in Financial
Solutions and new protection business in the region as presented during the
Investor Day in 2014;
* Growth in Protection key markets, with the technical margin fully in line
with expectations.
SCOR Global Life records a robust technical margin of 7.2%, above the "Optimal
Dynamics" assumption, thanks to the good performance of the in-force portfolio
during the quarter.
2014 Market Consistent Embedded Value for SCOR Global Life[6] increases by 6.2%
to EUR 4.7 billion (or EUR 25.50 per share), which validates the long-term
strength of the biometric portfolio.
SCOR Global Investments delivers a very strong return on invested assets of
3.5%, in an historically low yield environment
SCOR Global Investments key figures:
+---------------------------------+
| First quarter 2015 results |
+---------------------------------+
In EUR millions (rounded, at current | Q1 2015 Q1 2014 Variation|
exchange rates) |(Unaudited) (Unaudited) |
+--------------------------------------------+---------------------------------+
| Total investments | 27,119 22,731 19.3% |
| | |
| * of which total invested assets | 18,087 14,539 24.4% |
| | |
| * of which total funds withheld by cedants| 9,032 8,192 10.3% |
+--------------------------------------------+---------------------------------+
| Return on investments(*) | 2.9% 2.4% 0.5 pts |
+--------------------------------------------+---------------------------------+
| Return on invested assets(**) | 3.5% 2.6% 0.9 pts |
+--------------------------------------------+---------------------------------+
((*)) Annualized, including interest on deposits (i.e. interest on funds
withheld).
((**)) Annualized, excluding interest on deposits (i.e. interest on funds
withheld).
In an exceptionally low yield environment, SCOR Global Investments continues its
policy of progressively rebalancing its portfolio during the first quarter of
2015 while selectively increasing the duration of the fixed income portfolio, in
line with the indications given in the "Optimal Dynamics" plan.
Cash and short-term investments represent 5% of invested assets at 31 March
2015 (excluding funds withheld by cedants), stable compared to 31 December
2014. The duration of the fixed income portfolio stands at 4.1 years (excluding
cash) at 31 March 2015, compared to 4.0 years at 31 December 2014 and
3.8 years at 31 March 2014.
The stable average rating of AA- bears witness to the quality of the fixed
income portfolio. As at
31 March 2015, expected cash flow on the fixed income portfolio over the next
24 months stands at
EUR 5.3 billion (including cash and short-term investments), facilitating
dynamic management of the reinvestment policy.
During the first quarter of 2015, invested assets generated a very strong
financial contribution of
EUR 149 million. The active management policy employed by SCOR Global
Investments has enabled the Group to record capital gains of EUR 73 million in
Q1 2015, coming mainly from the equity portfolio.
The return on invested assets stands at 3.5% for the first three months of
2015. Taking account of funds withheld by cedants, the net rate of return on
investments stands at 2.9% for the first quarter of 2015.
Invested assets (excluding funds withheld by cedants) stand at EUR 18,087
million as at 31 March 2015, and are composed as follows: 4% cash, 82% fixed
income (of which less than 1% are short-term investments), 3% loans, 3%
equities, 4% real estate and 3% other investments. Total investments,
including EUR 9,032 million of funds withheld, stand at EUR 27,119 million at
31 March 2015, compared to EUR 24,854 million at 31 December 2014.
APPENDIX
1 - P&L Key figures Q1 2015 (in EUR millions, at current exchange rates)
+---------------------------------------+
| Q1 2015 |
+---------------------------------------+
| Q1 2015 Q1 2014 |
| (Unaudited) (Unaudited) Variation |
| |
+-----------------------------+---------------------------------------+
| Gross written premiums | 3,124 2,669 17.0% |
+-----------------------------+---------------------------------------+
| P&C gross written premiums | 1,398 1,202 16.3% |
+-----------------------------+---------------------------------------+
| Life gross written premiums | 1,726 1,467 17.7% |
+-----------------------------+---------------------------------------+
| Net investment income | 180 132 36.4% |
+-----------------------------+---------------------------------------+
| Operating results | 287 210 36.7% |
+-----------------------------+---------------------------------------+
| Net income(1) | 175 135 29.6% |
+-----------------------------+---------------------------------------+
| Earnings per share (EUR) | 0.95 0.73 29.5% |
+-----------------------------+---------------------------------------+
| Operating cash flow | 62 -101 n/a |
+-----------------------------+---------------------------------------+
1: Consolidated net income, Group share.
2 - P&L Key ratios Q1 2015
+---------------------------------------+
| Q1 2015 |
+---------------------------------------+
| Q1 2015 Q1 2014 |
| (Unaudited) (Unaudited) Variation |
| |
+---------------------------------+---------------------------------------+
| Return on investments( 1) | 2.9% 2.4% 0.5 pts |
+---------------------------------+---------------------------------------+
| Return on invested assets (1,2) | 3.5% 2.6% 0.9 pts |
+---------------------------------+---------------------------------------+
| P&C net combined ratio( 3) | 89.1% 88.9% 0.2 pts |
+---------------------------------+---------------------------------------+
| Life technical margin( 4) | 7.2% 7.3% -0.1 pts |
+---------------------------------+---------------------------------------+
| Group cost ratio( 5) | 5.15% 4.98% 0.17 pts |
+---------------------------------+---------------------------------------+
| Return on equity (ROE)(6) | 12.1% 11.2% 0.9 pts |
+---------------------------------+---------------------------------------+
1: Annualized; 2: Excluding funds withheld by cedants; 3: The combined ratio is
the sum of the total claims, the total commissions and the total P&C management
expenses, divided by the net earned premiums of SCOR Global P&C; 4: The
technical margin for SCOR Global Life is the technical result divided by the net
earned premiums of SCOR Global Life; 5: The cost ratio is the total management
expenses divided by the gross written premiums; 6: Annualized. The ROE
calculation method was adjusted to take into account material foreign exchange
rate movements that do not occur evenly through the reporting period. A daily
weighted average is applied for the currency or currencies that experienced such
movements and a simple weighted average is applied for the other currencies.
3 - Balance sheet Key figures as at 31 March 2015 (in EUR millions, at current
exchange rates)
+----------------------------------------------------+
| Key Figures |
+----------------------------------------------------+
|As at 31 March 2015 As at 31 December 2014 |
| Variation|
| (Unaudited) (Unaudited) |
+-------------------------+-------------------+----------------------+---------+
|Total investments( 1,2) | 27,119 | 24,854 | 9.1% |
+-------------------------+-------------------+----------------------+---------+
|Technical reserves | 27,865 | 25,839 | 7.8% |
|(gross) | | | |
+-------------------------+-------------------+----------------------+---------+
|Shareholders' equity | 6,415 | 5,729 | 12.0% |
+-------------------------+-------------------+----------------------+---------+
|Book value per share | 34.35 | 30.60 | 12.3% |
|(EUR) | | | |
+-------------------------+-------------------+----------------------+---------+
|Financial leverage ratio | 20.8% | 23.1% |-2.3 pts |
+-------------------------+-------------------+----------------------+---------+
|Total liquidity | 1,209 | 940 | 28.6% |
+-------------------------+-------------------+----------------------+---------+
1: Total investment portfolio includes both invested assets and funds withheld
by cedants, accrued interest, cat bonds, mortality bonds and FX derivatives; 2:
Excluding 3rd party net insurance business investments.
*
* ***** *
Forward-looking statements
SCOR does not communicate "profit forecasts" in the sense of Article 2 of (EC)
Regulation n°809/2004 of the European Commission. Thus, any forward-.looking
statements contained in this communication should not be held as corresponding
to such profit forecasts. Information in this communication may include
"forward-looking statements", including but not limited to statements that are
predictions of or indicate future events, trends, plans or objectives, based on
certain assumptions and include any statement which does not directly relate to
a historical fact or current fact. Forward-looking statements are typically
identified by words or phrases such as, without limitation, "anticipate",
"assume", "believe", "continue", "estimate", "expect", "foresee", "intend", "may
increase" and "may fluctuate" and similar expressions or by future or
conditional verbs such as, without limitations, "will", "should", "would" and
"could." Undue reliance should not be placed on such statements, because, by
their nature, they are subject to known and unknown risks, uncertainties and
other factors, which may cause actual results, on the one hand, to differ from
any results expressed or implied by the present communication, on the other
hand.
Please refer to SCOR's Document de référence filed with the AMF on 20 March
2015 under number D.15-0181 (the "Document de référence"), for a description of
certain important factors, risks and uncertainties that may affect the business
of the SCOR Group. As a result of the extreme and unprecedented volatility and
disruption of the current global financial crisis, SCOR is exposed to
significant financial, capital market and other risks, including movements in
interest rates, credit spreads, equity prices, and currency movements, changes
in rating agency policies or practices, and the lowering or loss of financial
strength or other ratings.
The Group's financial information is prepared on the basis of IFRS and
interpretations issued and approved by the European Union. This financial
information does not constitute a set of financial statements for an interim
period as defined by IAS 34 "Interim Financial Reporting".The Group's financial
information is prepared on the basis of IFRS and interpretations issued and
approved by the European Union. This financial information does not constitute a
set of financial statements for an interim period as defined by IAS 34 "Interim
Financial Reporting".
--------------------------------------------------------------------------------
[1]The ROE calculation method was adjusted to take into account material foreign
exchange rate movements that do not occur evenly through the reporting period. A
daily weighted average is applied for the currency or currencies that
experienced such movements and a simple weighted average is applied for the
other currencies.
[2]This estimate is based on the 2014 internal model, taking into account the
available capital at year-end 2014 divided by the SCR as at that date, allowing
for planned business in 2015. The internal model will be subject to a review and
approval process conducted by the ACPR over the coming months.
[3] See press release of 29 April 2015
[4]See press release of 10 February 2015
[5] See press release of 3 March 2015
[6]See press release of 6 May 2015
SCOR Press Release:
http://hugin.info/143549/R/1918948/687058.pdf
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Source: Scor via GlobeNewswire
[HUG#1918948]
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Datum: 06.05.2015 - 07:33 Uhr
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