The most important key figures for the first half of 2013 in summary:
- Business volume:CHF 4,775.0 million (1st half of 2012: CHF 4,527.9 million; + 4.7 per cent in original currency)
- Net income after tax:CHF 179.4 million (1st half of 2012: CHF 158.2 million; + 13.4 per cent)
- Solvency I:210 per cent (31 December 2012: 227 per cent)
- Standard and Poor’s rating upgrade:“A” (previous year: “A-”)
- Other key figures are listed in the appendix
Helvetia succeeded in combining a healthy growth rate of 4.7 per cent in the original currency (or 5.5 per cent in CHF) with a profit increase of 13.4 per cent, thanks in part to its well-diversified portfolio and solid capitalisation. The profit for the period of CHF 179.4 million emphasises the Group's positive development. Not only did its Swiss home market remain strong with CHF 111.2 million in profit (+7.4 per cent), but foreign markets also put in a convincing performance despite the challenging economic climate in Europe. The business portfolio proved its value again in the first half of 2013 and enabled Helvetia to achieve excellent actuarial results in the life and non-life businesses. The combined ratio in the non-life business was 94.9 per cent (previous year: 93.7 per cent
) and thus within the Group’s defined target corridor of 94 to 96 per cent. Causes for the year-to-year rise include acquisition-related increases in the cost ratio and temporary declines in volume resulting from portfolio optimisations in key country markets. The claims ratio remained unchanged at the previous year’s level despite an increase in bad weatherclaims. The new business margin in the life business is 1.4 per cent (previous year: 0.9 per cent), which is within the target corridor.
Good business performance
The increase in business volume by 4.7 per cent to CHF 4,775.0 million was largely driven by factors in the life business in Switzerland, Germany and Austria. All of these markets exhibited strong growth, in some cases considerably above the market. Only Italy saw a decline in business volume. The decline was mainly caused by the January 2013 renewal and slight modification of the distribution agreement with Banco di Desio. In this area, our long-term strategy is to improve profitability by instituting a more balanced product mix and to control our exposure to Italian government bonds more actively. In the non-life segment, the transport insurance sector showed striking growth following the acquisition of the portfolio of Gan Eurocourtage in France, a subsidiary of Groupama SA. This was the first time that the portfolio had been consolidated for a full half-year. While Helvetia increased gross premium income in the non-life business in Switzerland and Austria, this income category declined in Italy and Spain due to the recessions in these countries. To improve earnings, Helvetia deliberately avoided low-margin business in Germany and Italy and reduced its business volume as planned. This programme, instituted in 2012 to reduce risks and strengthen profitability, is already paying off, especially in Germany.
Strong investment earnings and solid capitalisation
Financial markets remained deeply affected by the eurozone crisis and the low-interest environment in the first half of 2013. Stock markets benefited the most from the aggressive monetary policy of central banks. By relying on a proven investment strategy, Helvetia achieved a favourable investment result totalling CHF 599.5 million (previous year: CHF 543.2 million). The higher investment volume – associated with an increase in regular income – offset a slight decline in the annualised direct yield to 2.8 per cent (previous year: 2.9 per cent) attributable to persistently low interest rates. Helvetia remains well capitalised with a Solvency I ratio at 210 per cent and its solvency ratio under the newer Swiss Solvency Test at between 150 to 200 per cent. On 2 May 2013, the rating agency Standard & Poor’s (S&P), upgraded Helvetia Group’s rating from “A-” to “A”. The upgrade was attributed to Helvetia’s sustainable earnings, improved competitive position and strong capitalisation. The improved rating reflects the Group’s orientation towards long-term profitable growth along with a focus on sound capitalisation.
Stefan Loacker, CEO of Helvetia Group, notes: “Once again, Helvetia achieved profitable growth and raised its profit and premium volume further. We are confident that we are ready for the future and will continue to strengthen our competitive position in our markets.”
- A media conference in German will take place today at 09:00. This will be followed by an analysts' meeting and a conference call in English at 11:30.
- The analysts' meeting can be followed on the internet atwww.helvetia.com. A web replay of the analysts' meeting will be available onwww.helvetia.comfrom 16:00 today.
- The shareholders' letter, the preprint of the annual report and Powerpoint presentation for the media and analysts' conference can be downloaded fromwww.helvetia.com/infokit-hyimmediately.
- The most important key figures are provided in the enclosed fact sheet.