10.05.2016
Hannover Rück SE DE0008402215
DGAP-News: Hannover Re makes good start to the 2016 financial year
DGAP-News: Hannover Rück SE / Key word(s): Quarter Results
Hannover Re makes good start to the 2016 financial year
10.05.2016 / 07:00
The issuer is solely responsible for the content of this announcement.
---------------------------------------------------------------------------
Press release
Hannover Re makes good start to the 2016 financial year
- Group net income rises by 12.7% to EUR 271.2 million (EUR 240.7
million) after elimination of a positive special effect from the
previous year
- Gross premium in line with expectations, -2.1% adjusted for exchange
rate effects
- Sharply improved underwriting result in property and casualty
reinsurance
- Combined ratio: 94.7% (95.7%)
- Good business development in life and health reinsurance
- Return on investment: 2.9%
- Return on equity: 13.2%
- Group net income guidance for the 2016 financial year confirmed
Hannover, 10 May 2016: Hannover Re expressed considerable satisfaction with
the development of the first quarter. "Factoring out a positive special
effect recorded in the comparable quarter of 2015, we achieved a pleasing
increase in our Group net income as at 31 March 2016. This was driven by a
strong underwriting profit in property and casualty reinsurance as well as
good results in life and health reinsurance and on the investment side",
Chief Executive Officer Ulrich Wallin stated. The gratifying quarterly
result is a good first step towards achieving the full-year profit target
of at least EUR 950 million.
Gross premium develops in line with expectations
Gross written premium for the Hannover Re Group contracted slightly by 3.1%
to EUR 4.3 billion (EUR 4.4 billion). The decline would have been 2.1% at
constant exchange rates. The level of retained premium was slightly higher
than in the comparable period at 89.0% (88.6%). Net premium earned
increased by
3.2% to EUR 3.5 billion (EUR 3.4 billion) due to the change in unearned
premium; adjusted for exchange rate effects, growth would have come in at
4.5%.
Pleasing Group net income
The operating profit (EBIT) fell by 5.2% to EUR 406.7 million (EUR 429.0
million). Group net income amounted to EUR 271.2 million, after EUR 279.7
million in the comparable period. Not including the special effect of
around EUR 39 million recognised in the comparable period, Group net income
came in higher than in the previous year. Earnings per share stood at EUR
2.25 (EUR 2.32).
Property and casualty reinsurance shows further substantial improvement
after very good previous year
Worldwide property and casualty reinsurance continues to be fiercely
competitive, prompting Hannover Re to write business highly selectively in
accordance with its profit-oriented underwriting policy. Gross written
premium consequently contracted by 4.4% to EUR 2.5 billion (EUR 2.6
billion). At constant exchange rates the decrease would have been 3.7%. The
level of retained premium fell slightly from 88.9% to 87.9%. Net premium
earned rose by 4.2% to EUR 2.0 billion (EUR 1.9 billion) due to the change
in unearned premium; adjusted for exchange rate effects, growth would have
reached 5.2%.
As had been the case in the corresponding period of the previous year,
major loss expenditure for Hannover Re came in below the estimated
quarterly budget at EUR 55.5 million (EUR 62.0 million). The largest single
loss event for the company was an earthquake in Taiwan at EUR 15.6 million
for net account. The underwriting result closed at a very pleasing EUR
100.3 million (EUR 76.6 million). The combined ratio once again improved on
the previous year's period at 94.7% (95.7%).
Against this backdrop and supported by healthy investment income, the
operating profit (EBIT) in property and casualty reinsurance rose by a very
appreciable 17.4% to EUR 299.7 million (EUR 255.2 million). Group net
income increased by 19.2% to EUR 204.3 million (EUR 171.4 million).
Earnings per share stood at EUR 1.69 (EUR 1.42).
Life and health reinsurance posts good result
Life and health reinsurance fared better than anticipated in the first
quarter. Gross written premium as at 31 March 2016 retreated slightly by
1.2% to EUR 1.8 billion (EUR 1.8 billion); at constant exchange rates gross
written premium would have been virtually unchanged with a gain of 0.3%.
With the retention modestly higher at 90.5% (88.1%), net premium earned
climbed 2.0% to EUR 1.6 billion (EUR 1.5 billion); adjusted for exchange
rate effects, this is equivalent to growth of 3.6%. The operating result
(EBIT) came in slightly above our expectations at EUR 105.5 million (EUR
173.3 million). The previous year's figure had been influenced by
recognition of a fee in an amount of around EUR 39 million that became
payable following a customer-initiated withdrawal from a transaction. The
underwriting result continued to improve as at 31 March 2016. Group net
income fell by 38.9% to EUR 77.9 million (EUR 127.5 million). Earnings per
share amounted to EUR 0.65 (EUR 1.06).
Highly satisfactory investment income
The investment climate remains challenging owing to the protracted low
level of interest rates. The portfolio of investments under own management
was nevertheless largely unchanged after the sharp rise in 2015 at EUR 39.1
billion (31 December 2015: EUR 39.3 billion). Ordinary investment income
came in significantly lower than in the comparable period at EUR 268.5
million (EUR 312.2 million); this was due in particular to a special effect
recognised in the investments in the previous year from the life and health
reinsurance side. Interest on funds withheld and contract deposits declined
to EUR 83.5 million (EUR 99.0 million).
Realised gains amounted to EUR 43.6 million (EUR 45.0 million); they were
on a normal level and can be attributed in large measure to regrouping
activities as part of regular portfolio maintenance. Write-downs of just
EUR 13.9 million (EUR 8.2 million) had to be taken in the reporting period.
Income from assets under own management totalled EUR 282.7 million as at 31
March 2016, a decrease of 10.7% compared to the previous year's quarter
(EUR 316.6 million). The resulting annualised return on investment reached
2.9% (excluding ModCo derivatives), which is exactly the target for the
full financial year. Net investment income including interest on funds
withheld and contract deposits closed at EUR 366.2 million (EUR 415.7
million).
Shareholders' equity remains very robust
Hannover Re's shareholders' equity grew by 3.8% to EUR 8.4 billion (31
December 2015: EUR 8.1 billion). The annualised return on equity
nevertheless reached an attractive 13.2%. The book value per share
increased to EUR 69.42 (31 December 2015: EUR 66.90).
Capital adequacy ratio comfortably in excess of requirements
The capital adequacy ratio of the Hannover Re Group calculated in
accordance with the requirements of Solvency II was published at the same
time as the results for the first quarter of 2016. Amounting to 221 % as at
31 December 2015, it was exactly on the level of the previous quarter.
Outlook for 2016
Despite the challenging business conditions facing international
(re)insurance markets and the protracted low level of interest rates,
Hannover Re expects to be able to operate with sustained success even in
this environment.
Based on constant exchange rates, the company anticipates stable or
slightly lower gross premium as well as net income after tax of at least
EUR 950 million for the full 2015 financial year. This is conditional on
major loss expenditure not significantly exceeding the budgeted level of
EUR 825 million and assumes that there are no unforeseen distortions on
capital markets.
In property and casualty reinsurance Hannover Re expects to post a good
underwriting result for 2016 that should be roughly on the level of 2015.
The company is aiming for a combined ratio of less than 96%. The EBIT
margin for property and casualty reinsurance should be at least 10%.
The competitive market conditions that still prevail in property and
casualty reinsurance were further underlined by the treaty renewals as at 1
April, the traditional date on which business in Japan and - albeit on a
smaller scale - treaties in the markets of Australia, New Zealand, Korea
and North America are renewed. In view of its selective underwriting policy
and the company's concentration on existing business, Hannover Re was able
to preserve the good quality of its property and casualty reinsurance
portfolio. The premium volume booked from this round of treaty renewals
increased by 9.1% due to profitable business opportunities.
The company expects to see further improvement in the development of its
life and health reinsurance business. This should be especially evident in
emerging markets and - following the implementation of Solvency II - in
Europe as well as in the area of longevity risks. While it is Hannover Re's
expectation that some large-volume treaties will be discontinued, the gross
premium volume will likely remain broadly stable on the back of new
business production. The value of new business should be in excess of EUR
220 million. The targeted EBIT margins remain unchanged at 2% for financial
solutions and longevity business and 6% for mortality and morbidity
business.
The expected positive cash flow that Hannover Re generates from the
technical account and its investments should - subject to stable exchange
rates and yield levels - should lead to further growth in the asset
portfolios. The company is targeting a return on investment of 2.9% for
2016.
Hannover Re envisages a payout ratio for the dividend in the range of 35%
to 40% of its IFRS Group net income. This figure could increase in light of
capital management considerations if the company's comfortable level of
capitalisation remains unchanged.
For further information please contact:
Corporate Communications:
Karl Steinle (tel. +49 511 5604-1500,
e-mail: [email protected])
Media Relations:
Gabriele Handrick (tel. +49 511 5604-1502,
e-mail: [email protected])
Investor Relations:
Julia Hartmann (tel. +49 511 5604-1529,
e-mail: [email protected])
Please visit: www.hannover-re.com
Hannover Re, with gross premium of around EUR 17 billion, is the
third-largest reinsurer in the world. It transacts all lines of property &
casualty and life & health reinsurance and is present on all continents
with around 2,500 staff. Established in 1966, the Hannover Re Group today
has a network of more than 100 subsidiaries, branches and representative
offices worldwide. The Group's German business is written by the subsidiary
E+S Rück. The rating agencies most relevant to the insurance industry have
awarded both Hannover Re and E+S Rück very strong insurer financial
strength ratings: Standard & Poor's AA- "Very Strong" and A.M. Best A+
"Superior". In 2016 Hannover Re celebrates its fiftieth anniversary.
Please note the disclaimer:
https://www.hannover-re.com/535917
Key figures of the Hannover Re Group (IFRS basis)
in EUR million Q1/2016 +/- previous Q1/2015 2015 year Hannover Re Group Gross written premium 4,263.6 -3.1% 4,400.2 Net premium earned 3,542.0 +3.2% 3,431.9 Net underwriting result 36.0 (6.2) Net investment income 366.2 -11.9% 415.7 Operating profit (EBIT) 406.7 -5.2% 429.0 Group net income 271.2 -3.1% 279.7 Earnings per share in EUR 2.25 -3.1% 2.32 Retention 89.0% 88.6% Tax ratio 26.2% 31.1% EBIT margin1) 11.5% 12.5% Return on equity 13.2% 13.9% in EUR million Q1/2016 +/- previous Q1/2015 2015 year Policyholders' surplus 10,551.6 +2.8% 10,267.3 Investments (excl. funds held 39,065.4 -0.7% 39,346.9 by ceding companies) Total assets 61,889.8 -2.1% 63,214.9 Book value per share in EUR 69.42 +3.8% 66.90 Property & Casualty reinsurance in EUR million Q1/2016 +/- previous Q1/2015 2015 year Gross written premium 2,502.1 -4.4% 2,617.1 Net premium earned 1,961.3 +4.2% 1,882.3 Net underwriting result 100.3 +31.0% 76.6 Operating profit (EBIT) 299.7 +17.4% 255.2 Group net income 204.3 +19.2% 171.4 Retention 87.9% 88.9% Combined Ratio2) 94.7% 95.7% EBIT margin1) 15.3% 13.6% Life & Health reinsurance in EUR million Q1/2016 +/- previous Q1/2015 2015 year Gross written premium 1,761.4 -1.2% 1,783.3 Net premium earned 1,580.7 +2.0% 1,549.5 Operating profit (EBIT) 105.5 -39.1% 173.3 Group net income 77.9 -38.9% 127.5 Retention 90.5% 88.1% EBIT margin1) 6.7% 11.2%1) Operating result (EBIT)/net premium earned 2) Including funds withheld --------------------------------------------------------------------------- 10.05.2016 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG. The issuer is solely responsible for the content of this announcement. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: English Company: Hannover Rück SE Karl-Wiechert-Allee 50 30625 Hannover Germany Phone: +49-(0)511-5604-1500 Fax: +49-(0)511-5604-1648 E-mail: [email protected] Internet: www.hannover-re.com ISIN: DE0008402215 WKN: 840 221 Indices: MDAX Listed: Regulated Market in Frankfurt (Prime Standard), Hanover; Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Munich, Stuttgart; Terminbörse EUREX; Luxemburg End of News DGAP News Service --------------------------------------------------------------------------- 461747 10.05.2016
|
Weitere Ad-hoc und Unternehmensrelevante Mitteilungen zu
Hannover Rück SE ISIN: DE0008402215 können Sie bei EQS abrufen
Versicherungen , 840221 , HNR1 , XETR:HNR1