SCOR: First nine months 2015 results
(Thomson Reuters ONE) -
Press Release
4 November 2015 - N° 28
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
(at)SCOR_SE
SCOR combines growth, profitability and solvency to
generate a net income of EUR 492 million, up by 31%
SCOR delivers robust results for the first nine months of 2015, combining
growth, profitability and solvency, and pursues the active implementation of the
"Optimal Dynamics" strategic plan.
- Gross written premiums reach EUR 9,996 million in the first nine months, up
19.3% at current exchange rates compared to the same period in 2014 (+5.8% at
constant exchange rates). This significant growth is driven by the contribution
of the two business engines:
* SCOR Global P&C gross written premiums increase by 18.4% at current exchange
rates (+5.9% at constant exchange rates) to EUR 4,356 million;
* SCOR Global Life gross written premiums reach EUR 5,641 million, up by
19.9% at current exchange rates (+5.8% at constant exchange rates).
* SCOR Global P&C records excellent technical profitability with a net
combined ratio of 90.8% in the first nine months, in an environment of low
natural catastrophe losses but with an unusually high frequency of large
man-made losses.
- SCOR Global Life records a technical margin of 7.2% for the first nine months
of 2015, consistently delivering above the "Optimal Dynamics" assumption of
7.0%.
- SCOR Global Investments achieves a 3.1% return on invested assets thanks to
its active portfolio management.
- Group net income reaches EUR 492 million in the first nine months of 2015, an
increase of 30.5% compared to 2014. The annualized return on equity (ROE) stands
at 11.1% or
1,104 bps above the risk-free rate[1].
- Shareholders' equity increases by 6.5% in the first nine months of 2015 to
reach
EUR 6,104 million at 30 September 2015, compared to EUR 5,729 million at 31
December 2014, after the payment of EUR 260 million of dividends in May 2015 for
the year 2014. This translates into a book value per share of EUR 32.65 at 30
September 2015, compared to
EUR 30.60 at 31 December 2014. This increase is driven by a high net income
contribution and a favourable currency translation adjustment of EUR 215
million.
- SCOR's financial leverage stands at 23.0% at 30 September 2015, in line with
23.1% at
31 December 2014 following the successful placement of EUR 250 million dated
subordinated debt, issued with a coupon set at 3.25% in June 2015. In addition,
in the first nine months of 2015, SCOR has called two debts, due in 2029 and
2020 respectively, for EUR 10 million and
EUR 93 million. The Group's financial leverage remains below the 25% ceiling
indicated in the "Optimal Dynamics" plan.
- The ACPR (Autorité de contrôle prudentiel et de résolution) has notified SCOR
of its intention to approve the Group's internal model[2]. The solvency ratio at
the end of the first half of 2015 is estimated at 214% of the Solvency Capital
Requirement (SCR) and at 208% at the end of the third quarter 2015, up from
202% at the end of 2014[3].
SCOR Group 2015 YTD and Q3 2015 standalone key financial details:
+---------------------------+-------------------------+
In EUR millions | YTD | QTD |
(unaudited, rounded, at | | |
current exchange rates) |9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
| 2015 2014 | |
+------------------------+---------------------------+-------------------------+
|Gross written premiums | 9,996 8,382 19.3% | 3,503 2,955 18.6% |
+------------------------+---------------------------+-------------------------+
|Group Cost Ratio | 5.0% 4.9% 0.1 pts | 4.8% 4.7% 0.1 pts |
+------------------------+---------------------------+-------------------------+
|Return on invested | 3.1% 2.9% 0.2 pts | 2.6% 2.9% -0.3 pts |
|assets | | |
+------------------------+---------------------------+-------------------------+
| Annualized ROE | 11.1% 9.8% 1.3 pts | 11.4% 9.5% 1.9 pts |
+------------------------+---------------------------+-------------------------+
| Net income(*) | 492 377 30.5% | 165 121 36.4% |
+------------------------+---------------------------+-------------------------+
| Shareholders' equity | 6,104 5,501 11.0% | 6,104 5,501 11.0% |
|(at 30/09) | | |
+------------------------+---------------------------+-------------------------+
| P&C Combined ratio | 90.8% 91.6% -0.8 pts | 90.6% 92.8% -2.2 pts |
+------------------------+---------------------------+-------------------------+
| Life technical margin | 7.2% 7.2% - | 7.2% 7.2% - |
+------------------------+---------------------------+-------------------------+
(*) Consolidated net income, Group share.
Over the period, the Group's strategy and financial strength were recognized by
the rating agencies:
* On 27 July 2015, Fitch Ratings upgraded SCOR's Insurer Financial Strength
(IFS) rating to "AA- stable outlook" from "A+ positive outlook";
* On 7 September 2015, Standard & Poor's upgraded SCOR's Insurer Financial
Strength rating to "AA- stable outlook" from "A+ positive outlook";
* On 11 September 2015, A.M. Best revised the outlook of SCOR and its main
subsidiaries to "positive" from "stable", as well as affirming the financial
strength rating (FSR) of "A" (Excellent) and the issuer credit ratings (ICR)
of "a+".
The Group's ratings reflect its high level of solvency, its technical
performance and the quality and resilience of its earnings, confirming SCOR as a
Tier 1 reinsurer.
Finally, SCOR accomplishes a major achievement with the ACPR's intention to
approve the use of its internal model to calculate its solvency capital
requirements, in view of the implementation of
Solvency II on 1 January 2016. SCOR's internal capital model is an original,
holistic, stochastic model, created by the Group itself, which draws on the
skills, expertise and experience of the Group's employees.
Denis Kessler, Chairman & CEO of SCOR, comments: "The Group has delivered
excellent results over the period in terms of growth, profitability and
solvency, putting SCOR firmly on track to achieve the targets set out in the
"Optimal Dynamics" plan. Major milestones have been achieved with the recent
upgrades of its rating to AA- and the intention of the ACPR to approve the
Group's internal model. All of this confirms SCOR's status as a Tier 1 global
reinsurer."
In the first nine months of 2015, SCOR Global P&C delivers excellent technical
profitability, with a net combined ratio of 90.8%
SCOR Global P&C key figures:
+---------------------------+-------------------------+
In EUR millions | YTD | QTD |
(unaudited, rounded, at | | |
current exchange rates) |9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
| 2015 2014 | |
+------------------------+---------------------------+-------------------------+
|Gross written premiums | 4,356 3,679 18.4% | 1,497 1,279 17.0% |
+------------------------+---------------------------+-------------------------+
|Combined ratio | 90.8% 91.6% -0.8 pts | 90.6% 92.8% -2.2 pts |
+------------------------+---------------------------+-------------------------+
SCOR Global P&C posts gross written premium growth of +18.4% at current exchange
rates (+5.9% at constant exchange rates) to EUR 4,356 million in the first nine
months of 2015.
SCOR Global P&C's gross written premiums are likely to exceed the assumption of
~EUR 5.6 billion for full year 2015 (stated during the 2015 Investor Day), due
to exchange rate movements.
In the first nine months of 2015, SCOR Global P&C records excellent technical
profitability with a net combined ratio of 90.8%, where the effect of the low
nat cat activity has been slightly counter-balanced by the unusually high number
of large man-made losses in Q2 and Q3 2015:
* Nat cat losses at 1.6%, including a EUR 13 million impact from the Chile
earthquake in the third quarter of 2015;
* A net attritional and commission ratio adding up to 82.5%, 1.5 percentage
points above the 81% assumed at the 2015 Investor Day, with 3.1 percentage
points of cumulative impact from the following events: in Q2 2015, an
offshore energy claim of EUR 56 million net before tax; and in Q3 2015, the
Tianjin port explosion of EUR 32 millionnet before tax and one onshore
energy claim of EUR 28 million net before tax.
The normalized net combined ratio (with a natural catastrophe budget of 7%)
stands at 96.2% for the first nine months of 2015. For the year 2015, the 94%
"normalized" combined ratio assumption as stated during the 2015 Investor Day is
very likely to remain affected by the exceptional frequency of large man-made
losses in Q2 and Q3 2015.
SCOR Global Life delivers strong profitability and widens its footprint in the
Asia-Pacific region in the first nine months of 2015
SCOR Global Life key figures:
+---------------------------+-------------------------+
In EUR millions | YTD | QTD |
(unaudited, rounded, at +---------------------------+-------------------------+
current exchange rates) |9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
| 2015 2014 | |
+------------------------+---------------------------+-------------------------+
|Gross written premiums | 5,641 4,703 19.9% | 2,007 1,676 19.7% |
+------------------------+---------------------------+-------------------------+
|Life technical margin | 7.2% 7.2% - | 7.2% 7.2% - |
+------------------------+---------------------------+-------------------------+
SCOR Global Life gross written premiums stand at EUR 5,641 million in the first
nine months of 2015, up 19.9% at current exchange rates compared to the same
period last year (+5.8% at constant exchange rates), resulting from:
* The Protection business successfully growing through new business flows in
Australia and Asia, as part of the Asia-Pacific business strategy;
* The Longevity premiums in line with increased forecast information, as
provided during the 2015 Investor Day;
* Financial Solutions commensurate with last year's level in a fluctuating
regulatory environment, thanks to an increase in business volume, mainly in
Asia.
SCOR Global Life consistently delivers above the "Optimal Dynamics" assumption
of 7.0%, with a strong technical margin of 7.2% for the first nine months of
2015, benefitting from:
* New business profitability, which continues to meet the Group ROE target of
1,000 bps above the risk-free rate;
* A healthy in-force portfolio, with mortality experience in line with
expectations.
SCOR Global Investments delivers a strong return on invested assets of 3.1% in
the first nine months of 2015, in a particularly low yield environment
SCOR Global Investments key figures:
+---------------------------+-------------------------+
In EUR millions | YTD | QTD |
(unaudited, rounded, at +---------------------------+-------------------------+
current exchange rates) 9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
2015 2014 | |
+------------------------+---------------------------+-------------------------+
| Total investments | 26,315 23,824 10.5% |26,315 23,824 10.5% |
| | | |
| * of which total | 17,355 15,460 12.3% |17,355 15,460 12.3% |
| invested assets | | |
| | | |
| * of which total funds| 8,960 8,364 7.1% | 8,960 8,364 7.1% |
| withheld by cedants | | |
+------------------------+---------------------------+-------------------------+
| Return on | 2.6% 2.5% 0.1 pts | 2.2% 2.5% -0.3 pts |
|investments(*) | | |
+------------------------+---------------------------+-------------------------+
| Return on invested | 3.1% 2.9% 0.2 pts | 2.6% 2.9% -0.3 pts |
|assets(**) | | |
+------------------------+---------------------------+-------------------------+
((*)) Annualized, including interest on deposits (i.e. interest on funds
withheld).
((**)) Annualized, excluding interest on deposits (i.e. interest on funds
withheld).
In the current uncertain market environment, SCOR Global Investments maintains
its prudent investment strategy and has decided to temporarily further increase
liquidity by 2 percentage points compared to the second quarter of 2015 to 11%
of the invested assets portfolio, while maintaining the fixed income portfolio
duration (excluding cash) broadly stable at 4.0 years at 30 September 2015.
The stable average rating of AA- bears witness to the quality of the fixed
income portfolio. Moreover, SCOR Global Investments continues to not have any
exposure to sovereign debt from the GIIPS countries[4].As at 30 September 2015,
the expected financial cash flow over the next 24 months stands at EUR 6.1
billion (including cash, coupons and redemptions), facilitating dynamic
management of the reinvestment policy in view of a possible rise in interest
rates.
During the first nine months of 2015, invested assets generate a strong
financial contribution of
EUR 408 million. The active asset management policy executed by SCOR Global
Investments has enabled the Group to record capital gains of EUR 145 million
over the period, coming mainly from the equity portfolio and to a lesser extent
from the fixed income portfolio.
The return on invested assets stands at 3.1% for the first nine months of 2015,
compared to 2.9% for the same period last year. Taking account of funds withheld
by cedants, the net rate of return on investments stands at 2.6% for the first
nine months of 2015. The reinvestment yield stands at 2.0%[5] at the end of Q3
2015.
Invested assets (excluding funds withheld by cedants) stand at EUR 17,355
million as at
30 September 2015, and are composed as follows: 9% cash, 78% fixed income (of
which 2% are short-term investments), 3% loans, 3% equities, 5% real estate and
2% other investments. Total investments, including EUR 8,960 million of funds
withheld, stand at EUR 26,315 million at
30 September 2015, compared to EUR 24,854 million at 31 December 2014.
*
* *
APPENDIX
1 - P&L Key figures 2015 YTD and Q3 2015 standalone
+---------------------------+-------------------------+
| YTD | QTD |
In EUR millions | | |
(unaudited, rounded, at |9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
current exchange rates) | 2015 2014 | |
+------------------------+---------------------------+-------------------------+
|Gross written premiums | 9,996 8,382 19.3% | 3,503 2,955 18.6% |
+------------------------+---------------------------+-------------------------+
|P&C gross written | 4,356 3,679 18.4% | 1,497 1,279 17.0% |
|premiums | | |
+------------------------+---------------------------+-------------------------+
|Life gross written | 5,641 4,703 19.9% | 2,007 1,676 19.7% |
|premiums | | |
+------------------------+---------------------------+-------------------------+
|Net investment income | 505 421 20.0% | 140 140 - |
+------------------------+---------------------------+-------------------------+
|Operating results | 802 594 35.0% | 262 191 37.2% |
+------------------------+---------------------------+-------------------------+
|Net income(1) | 492 377 30.5% | 165 121 36.4% |
+------------------------+---------------------------+-------------------------+
|Earnings per share (EUR)| 2.65 2.03 30.7% | 0.89 0.65 36.6% |
+------------------------+---------------------------+-------------------------+
|Operating cash flow | 558 470 18.7% | 428 468 -8.5% |
+------------------------+---------------------------+-------------------------+
1: Consolidated net income, Group share.
2 - P&L Key ratios 2015 YTD and Q3 2015 standalone
+---------------------------+-------------------------+
(Unaudited) | YTD | QTD |
| | |
|9 months 9 months Variation|Q3 2015 Q3 2014 Variation|
| 2015 2014 | |
+------------------------+---------------------------+-------------------------+
|Return on investments( | 2.6% 2.5% 0.1 pts | 2.2% 2.5% -0.3 pts |
|1) | | |
+------------------------+---------------------------+-------------------------+
|Return on invested | 3.1% 2.9% 0.2 pts | 2.6% 2.9% -0.3 pts |
|assets (1,2) | | |
+------------------------+---------------------------+-------------------------+
|P&C net combined ratio( | 90.8% 91.6% -0.8 pts | 90.6% 92.8% -2.2 pts |
|3) | | |
+------------------------+---------------------------+-------------------------+
|Life technical margin( | 7.2% 7.2% - | 7.2% 7.2% - |
|4) | | |
+------------------------+---------------------------+-------------------------+
|Group cost ratio( 5) | 5.0% 4.9% 0.1 pts | 4.8% 4.7% 0.1 pts |
+------------------------+---------------------------+-------------------------+
|Return on equity | 11.1% 9.8% 1.3 pts | 11.4% 9.5% 1.9 pts |
|(ROE)(6) | | |
+------------------------+---------------------------+-------------------------+
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.
3 - Balance sheet Key figures as at 30 September 2015
+----------------------------------------------------+
| Key Figures |
In EUR millions +----------------------------------------------------+
(unaudited, rounded, at | As at 30 September As at 31 December Variation|
current exchange rates) | 2015 2014 |
+-------------------------+---------------------+--------------------+---------+
|Total investments( 1,2) | 26,315 | 24,854 | 5.9% |
+-------------------------+---------------------+--------------------+---------+
|Technical reserves | 27,265 | 25,839 | 5.5% |
|(gross) | | | |
+-------------------------+---------------------+--------------------+---------+
|Shareholders' equity | 6,104 | 5,729 | 6.5% |
+-------------------------+---------------------+--------------------+---------+
|Book value per share | 32.65 | 30.60 | 6.7% |
|(EUR) | | | |
+-------------------------+---------------------+--------------------+---------+
|Financial leverage ratio | 23.0% | 23.1% |-0.1 pts |
+-------------------------+---------------------+--------------------+---------+
|Total liquidity | 1,977 | 940 | 110.3% |
+-------------------------+---------------------+--------------------+---------+
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".
Certain prior year balance sheet items have been reclassified to be consistent
with the current year presentation.
The presented Q3 2015 financial results are unaudited.
--------------------------------------------------------------------------------
[1] Three-month risk-free rate.
[2]See the Press Release n° 27 published on 4 November 2015.
[3] Solvency ratio at the end of 2014 stands at 202%, vs 204% disclosed during
the 2015 Investor Day, following the last adjustments requested by the ACPR on
the operational risk model.
[4] Greece, Ireland, Italy, Portugal, Spain.
[5] Corresponds to marginal reinvestment yields based on Q3 2015 asset
allocation of yielding asset classes (i.e. fixed income, loans and real estate),
according to current reinvestment duration assumptions and spreads. Yield curves
as of 22/10/2015.
SCOR Press Release:
http://hugin.info/143549/R/1963719/716724.pdf
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Source: Scor via GlobeNewswire
[HUG#1963719]
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Datum: 04.11.2015 - 07:19 Uhr
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