10.03.2015
Hannover Rück SE DE0008402215
DGAP-News: Hannover Re generates new record result
DGAP-News: Hannover Rück SE / Key word(s): Final Results
Hannover Re generates new record result
10.03.2015 / 07:45
---------------------------------------------------------------------
Press release
Hannover Re generates new record result
- Group net income boosted by 10.1% to EUR 985.6 million (EUR 895.5
million)
- Increased dividend proposed for 2014: EUR 3.00 per share plus special
dividend of EUR 1.25 per share
- Book value per share: EUR 62.61 (EUR 48.83)
- Return on equity: 14.7% (15.0%)
- Combined ratio: 94.7% (94.9%)
- Currency-adjusted growth in gross premium: +2.8%
- Major loss expenditure of EUR 425.7 million substantially lower than
budgeted
Hannover, 10 March 2015: With Group net income of EUR 985.6 million for the
2014 financial year Hannover Re comfortably surpassed the record result of
the previous year and its targeted year-end profit in the order of EUR 850
million. "The successful financial year was based on a 25 percent rise in
net income in life and health reinsurance and the continued good
underwriting result in property and casualty reinsurance. Furthermore, we
were able to slightly improve our investment income despite the challenging
market environment", Chief Executive Officer Ulrich Wallin explained.
It is envisaged that Hannover Re's shareholders should also benefit from
this pleasing business development. The Executive Board and Supervisory
Board will therefore propose to the Annual General Meeting that a dividend
of altogether EUR 4.25 per share (EUR 3.00 per share) should be paid for
the 2014 financial year: the payout will take the form of a dividend of EUR
3.00 per share plus a special dividend of EUR 1.25 per share. "We are
thereby recognising that Hannover Re's capitalisation now significantly
exceeds its required capital. In so far, the special dividend should be
seen as a capital management measure", Mr. Wallin noted. The payout ratio
of 52% of IFRS Group net income is above the range of 35% to
40% set for the strategic target ratio.
2014 best financial year in the company's history
Hannover Re is exceptionally pleased with the development of its business
in 2014. Although the general environment facing reinsurers became even
more challenging in the year under review, the company was able to grow its
gross premium by 2.9% to EUR 14.4 billion (EUR 14.0 billion);
currency-adjusted growth stood at 2.8%. The level of retained premium
decreased to 87.6% (89.0%). Net premium earned rose to EUR 12.4 billion
(EUR 12.2 billion); at unchanged exchange rates growth would have come in
at 1.5%.
The operating profit (EBIT) of the Hannover Re Group improved by a further
19.3% on the already very good level of the previous year to reach EUR 1.5
billion (EUR 1.2 billion). Both business groups, namely property & casualty
and life & health reinsurance, as well as the investment income played a
part in this good result. Group net income surged by 10.1% to EUR 985.6
million (EUR 895.5 million). This is the highest figure in the company's
history. Earnings per share amounted to EUR 8.17 (EUR 7.43).
Property and casualty reinsurance posts further rise in profit
In worldwide property and casualty reinsurance the sometimes considerable
surplus capacities available in many markets led to further rate cuts.
Hannover Re continues to practise a profit-oriented, selective underwriting
policy in response to these difficult market conditions. In 2014, for
example, reduced shares in Europe and in catastrophe business were offset
by more attractive new business written primarily in the Asia-Pacific
region. The gross premium volume in property and casualty reinsurance
increased slightly by 1.1%, or by 1.2% adjusted for exchange rate effects,
to EUR 7.9 billion (EUR 7.8 billion). The level of retained premium climbed
to 90.6% (89.9%). Net premium earned grew to EUR 7.0 billion (EUR 6.9
billion); at constant exchange rates it would have risen by 2.1%.
As in the previous year, Hannover Re's major loss expenditure was
considerably lower than anticipated. This was due to the absence of
sizeable natural catastrophe events and in particular a benign hurricane
season. The aviation line was, however, impacted by an exceptional
accumulation of losses. In addition, storm "Ela" in Western Europe caused
heavy damage. These and other major losses resulted in total net
expenditure for Hannover Re of EUR 425.7 million (EUR 577.6 million). At
94.7% (94.9%), the combined ratio once again improved on the previous year.
Against this backdrop, and also thanks to higher investment income in
property and casualty reinsurance, the operating profit (EBIT) soared by
12.2% to EUR 1.2 billion. Group net income increased by a less appreciable
2.7% to EUR 829.1 million (EUR 807.7 million) owing to the elimination of a
positive tax effect that had been recognised in the previous year. This
level nevertheless marks a new all-time best. Earnings per share stood at
EUR 6.88 (EUR 6.70).
Favourable development in life and health reinsurance
Life and health reinsurance enjoyed a pleasing business development in
2014. Although the international market climate was difficult due to the
protracted period of low interest rates, Hannover Re's partnership-based
relationships and global presence nevertheless enabled the company to act
on sufficient opportunities for sustainable growth, including for example
in the area of longevity risks. The company was also successful in
expanding its business in China, Australia and the United States. Gross
premium consequently increased by 5.1% to EUR 6.5 billion (EUR 6.1
billion). Adjusted for exchange rate effects, growth would have come in at
4.9%. Net premium earned increased by 1.0% to EUR 5.4 billion (EUR 5.4
billion); growth of 0.7% would have been posted on a currency-adjusted
basis.
The premium growth was outpaced by the improvement in the operating result
(EBIT) in life and health reinsurance. EBIT surged by a substantial 75.3%
to EUR 263.8 million (EUR 150.5 million). The improved result compared to
the previous year, which had been overshadowed by losses in the Australian
disability portfolio and to some extent also in US mortality business,
demonstrates the effectiveness of the steps taken to boost profitability.
Group net income in life and health reinsurance reached EUR 205.0 million
(EUR 164.2 million). Earnings per share amounted to EUR 1.70 (EUR 1.36).
Highly satisfactory investment income
Hannover Re is thoroughly satisfied with the development of its investments
in light of the low level of interest rates: the return on investment for
assets under own management (excluding ModCo derivatives and inflation
swaps) stood at 3.3% and was thus slightly higher than the targeted level
of 3.2%. The portfolio of assets under own management grew substantially to
reach EUR 36.2 billion (EUR 31.9 billion) as at year-end 2014. This
increase resulted from a continued very positive operating cash flow, the
substantial rise in hidden reserves - especially for fixed-income
securities - as well as from exchange rate effects.
Ordinary investment income excluding income from funds withheld and
contract deposits improved by 2.6% to EUR 1.1 billion (EUR 1.0 billion)
despite persistently low interest rates. Income from funds withheld and
contract deposits increased year-on-year to EUR 376.1 million (EUR 357.3
million). The realised gains of EUR 182.5 million (EUR 144.2 million) were
necessarily higher than in the previous year due to portfolio regrouping
moves. The primary factors here were redemption of a bond issued in 2004,
the change in reporting currency at two subsidiaries and opportunities to
realise gains in the real estate sector. Changes in the fair values of
financial assets recognised at fair value through profit or loss amounted
to altogether EUR -33.3 million (EUR
-27.1 million). Write-downs totalling just EUR 27.7 million (EUR 19.4
million) were taken. The increase relative to the previous year is
attributable largely to scheduled depreciation that reflects Hannover Re's
higher real estate exposure.
All in all, income from investments under own management grew by 3.9% as at
31 December 2014 to EUR 1.1 billion (EUR 1.1 billion). Including income
from funds withheld and contract deposits, net investment income closed
4.3% higher at EUR 1.5 billion, as against EUR 1.4 billion in the previous
year.
Shareholders' equity further strengthened
Hannover Re's shareholders' equity continued to develop very favourably,
reaching EUR 7.6 billion as at 31 December 2014 (EUR 5.9 billion). The key
drivers here were a substantial rise in retained earnings due to the good
result and an increase of more than EUR 1 billion in the valuation
reserves. Despite the sharply higher shareholders' equity, the return on
equity of 14.7% was virtually on a par with the previous year (15.0%). The
total policyholders' surplus (including non-controlling interests and
hybrid capital) stood at EUR 10.2 billion (EUR 8.8 billion). The book value
per share reached EUR 62.61 (EUR 48.83) and thus surpassed the EUR 60 mark
for the first time.
Outlook for 2015
The general climate is likely to remain challenging in the current
financial year. Hannover Re anticipates little change in the intense
competitive pressure in property and casualty reinsurance or in the low
level of interest rates. "Our good market position as a broadly diversified
reinsurer, our excellent financial strength and our low administrative
expense ratio relative to our competitors should nevertheless enable us to
achieve another good result in 2015", Mr. Wallin stated.
Hannover Re continues to expect Group net income in the order of EUR 875
million. This is based on the premise that major loss expenditure does not
significantly exceed the budgeted level of EUR 690 million and that there
are no exceptionally adverse movements on capital markets.
The company expects its gross premium volume for total business - adjusted
for exchange rate effects - to remain stable or show low single-digit
percentage growth in 2015.
The asset portfolios should continue to grow - at constant exchange rates -
in view of the anticipated positive cash flow. The company is aiming for a
return on investment of 3.0%.
In terms of the dividend for the current financial year, Hannover Re
envisages a payout ratio in the range of 35% to 40% of its IFRS Group net
income. This ratio may increase in light of capital management
considerations if the present 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 EUR 14.4 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. The rating agencies most relevant to the insurance industry
have awarded Hannover Re very strong insurer financial strength ratings
(Standard & Poor's AA- "Very Strong" and A.M. Best A+ "Superior").
Please note the disclaimer:
https://www.hannover-re.com/535917
Key figures of the Hannover Re Group (IFRS basis) in EUR million 2014 +/- previous 2013 year Hannover Re Group Gross written premium 14,361.8 +2.9% 13,963.4 Net premium earned 12,423.1 +1.6% 12,226.7 Net underwriting result (23.6) (83.0) Net investment income 1,471.8 +4.3% 1,411.8 Operating profit (EBIT) 1,466.4 +19.3% 1,229.1 Group net income 985.6 +10.1% 895.5 Earnings per share in EUR 8.17 +10.1% 7.43 Retention 87.6% 89.0% Tax ratio 22.3% 14.8% EBIT margin1) 11.8% 10.1% Return on equity 14.7% 15.0% in EUR million 2014 +/- previous 2013 year Policyholders' surplus 10,239.5 +16.8% 8,767.9 Investments (excl. funds held by 36,228.0 +13.7% 31,875.2 ceding companies) Total assets 60,457.6 +12.1% 53,915.5 Book value per share in EUR 62.61 +28.2% 48.83 Property & Casualty reinsurance in EUR million 2014 +/- previous 2013 year Gross written premium 7,903.4 +1.1% 7,817.9 Net premium earned 7,011.3 +2.1% 6,866.3 Net underwriting result 351.5 +4.8% 335.5 Operating profit (EBIT) 1,190.8 +12.2% 1,061.0 Group net income 829.1 +2.7% 807.7 Retention 90.6% 89.9% Combined Ratio2) 94.7% 94.9% EBIT margin1) 17.0% 15.5% Life & Health reinsurance in EUR million 2014 +/- previous 2013 year Gross written premium 6,458.7 +5.1% 6,145.4 Net premium earned 5,411.4 +1.0% 5,359.8 Operating profit (EBIT) 263.8 +75.3% 150.5 Group net income 205.0 +24.8% 164.2 Retention 83.9% 87.7% EBIT margin1) 4.9% 2.8%1) Operating result (EBIT)/net premium earned 2) Including funds withheld Key figures of the Hannover Re Group (IFRS basis) in EUR million Q4/2014 +/- previous year Q4/2013 Hannover Re Group Gross written premium 3,657.3 +6.8% 3,425.5 Net premium earned 3,457.0 +11.2% 3,109.4 Net underwriting result (11.8) (58.4) Net investment income 350.5 -2.2% 358.6 Operating profit (EBIT) 375.6 +54.4% 243.3 Group net income 290.2 +9.4% 265.2 Earnings per share in EUR 2.41 +9.4% 2.20 Retention 89.2% 89.2% Tax ratio 13.0% (29.0%) EBIT margin1) 10.9% 7.8% Return on equity 16.0% 18.2% Property & Casualty reinsurance in EUR million Q4/2014 +/- previous year Q4/2013 Gross written premium 1,843.3 -1.0% 1,861.4 Net premium earned 1,906.9 +7.5% 1,773.1 Net underwriting result 126.3 +37.1% 92.1 Operating profit (EBIT) 344.0 +34.2% 256.4 Group net income 268.3 -1.8% 273.3 Retention 94.0% 92.5% Combined Ratio2) 93.1% 94.6% EBIT margin1) 18.0% 14.5% Life & Health reinsurance in EUR million Q4/2014 +/- previous year Q4/2013 Gross written premium 1,814.1 +16.0% 1,563.8 Net premium earned 1,550.0 +16.0% 1,336.2 Operating profit (EBIT) 29.9 (17.1) Group net income 38.8 11.2 Retention 84.3% 85.3% EBIT margin1) 1.9% (1.3%)1) Operating result (EBIT)/net premium earned 2) Including funds withheld --------------------------------------------------------------------- 10.03.2015 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 --------------------------------------------------------------------- 331469 10.03.2015
|
Weitere Ad-hoc und Unternehmensrelevante Mitteilungen zu
Hannover Rück SE ISIN: DE0008402215 können Sie bei EQS abrufen
Versicherungen , 840221 , HNR1 , XETR:HNR1