Alm. Brand - Alm. Brand - Preliminary statement of financial results for 2018

Alm. Brand - Preliminary statement of financial results for 2018

February 05, 2019

5 February 2019
Announcement no. 07/2019

Alm. Brand – Preliminary statement of financial results for 2018

Alm. Brand posted a highly satisfactory full-year profit of DKK 724 million before tax. The Board of Directors recommends a distribution of up to DKK 670 million to the shareholders by way of dividends and share buybacks. The guidance for a pre-tax profit of DKK 500-600 million for 2019 is maintained.

We are extremely pleased with the DKK 724 million profit reported by Alm. Brand. It shows that even in a year characterised by fierce competition, extremely volatile financial markets, low borrowing requirements and interest rate levels, and industry expenses to cover the failure of an external insurance company, we were able to create value for our customers, our employees and our shareholders, said Alm. Brand CEO Søren Boe Mortensen.
Supported by growth in all business areas, high customer satisfaction and modernised systems and processes, our group is strongly poised to create good results in 2019, he continued.
We are also pleased to be able, again this year, to make distributions to our shareholders to the tune of DKK 670 million in the form of dividends and treasury share buybacks, Søren Boe Mortensen concluded.

Full-year results:

Non-life Insurance posted a highly satisfactory pre-tax profit of DKK 652 million.

The 2018 performance was lifted by run-off gains and very mild weather conditions. On the other hand, the investment result and a DKK 30 million expense triggered by the bankruptcy of Alpha Insurance detracted from performance. Adjusted for this expense, the performance was slightly better than the most recent guidance and significantly better than expected at the beginning of the year.

Gross premiums amounted to DKK 5.3 billion, up 2.3% on last year. Both private and commercial lines improved, reporting growth of 1.0% and 3.6%, respectively. Customer loyalty remained at a high level with an upward trend in the commercial customer segment in 2018.

The combined ratio was 87.0, while the expense ratio was 17.2.

Life Insurance generated a pre-tax profit of DKK 104 million, which was highly satisfactory.

Pension contributions were up by 44% relative to 2017. Regular payments were up by 9%, while single payments increased by 80%. Growth was highly satisfactory and reflected the group’s growth ambitions in the pensions area.

The bonus rate was 18.6 at 31 December 2018. The high bonus rate level enables Alm. Brand to continue to offer a competitive rate on policyholders’ savings of 3.5%, which is still the highest rate offered in the market.

The bank generated an overall pre-tax profit of DKK 26 million in 2018. Although the profit was in line with original expectations, the profit composition was not satisfactory.

The bank reported strong growth in new lending, and the number of Pluskunder (customers who have pooled all of their business with the bank) was up by 13%, not including former Saxo Privatbank customers. Including former Saxo Privatbank customers, the number of Pluskunder increased by 34% and has now exceeded 21,000 customers measured in terms of households. The strong growth in new lending to customers was to a large extent offset by repayment of loans, generally lower borrowing requirements and conversion of bank loans to Totalkredit mortgage loans, all of which affected net lending.

The integration of the Saxo Privatbank activities was fully completed in November by the conversion of data to the bank’s current data centre, Bankdata, and adjustment of the future organisation. As expected, no significant synergy benefits crystallised in 2018, whereas cost synergies of DKK 75 million before amortisation of customer relationships are expected for 2019.

Dividends

The Board of Directors recommends payment of an ordinary dividend of DKK 1.50 per share, an extraordinary dividend of DKK 1.50 per share and that a new share buyback programme of up to DKK 200 million will be initiated, which is expected to run until end-March 2020. Overall, this means that Alm. Brand will distribute up to DKK 670 million in respect of the 2018 financial year.

The share buyback programme is subject to the approval of the Danish Financial Supervisory Authority.

Outlook

Alm. Brand expects to report a pre-tax profit of DKK 500-600 million in 2019. The combined ratio for the group’s insurance activities is expected to be in the region of 91-92. The outlook is exclusive of run-off gains.

Webcast and conference call
Alm. Brand will host a webcast and conference call on Tuesday, 5 February 2019 at 10.00 a.m.

https://almbrand.eventcdn.net/20190205

Analysts are invited to participate by phone: Danish analysts: +45 3544 5583, US analysts: +1 855 269 2604, other international analysts: +44 (0) 203 194 0544.

Contact
Please direct any questions regarding this announcement to Søren Boe Mortensen, CEO, on tel. +45 35 47 79 07, or Susanne Biltoft, Director, Communications on tel. +45 35 47 76 61.

Attachments

Categories: Press Releases

View all news

Disclaimer

The information contained in this section of Alm. Brand A/S (the "Company") web page that you are attempting to access is not intended for, and must not be accessed by, or distributed or disseminated, directly or indirectly, in whole or in part, to persons resident or physically present in the United States of America (including its territories and possessions, any state of the United States and the District of Columbia, together, the "United States"), Canada, Australia and Japan, or any jurisdiction where to do so might constitute a violation of the local securities laws or regulations of such jurisdiction, and does not constitute an offer to sell or the solicitation of an offer to buy or acquire, any shares or other securities of the Company in the United States, Canada, Australia, Japan or any jurisdiction where to do so might constitute a violation of the local securities laws or regulations of such jurisdiction.

The shares of the Company referred to herein and on the following web page (the "Shares") have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") or with any securities regulatory authority under any applicable securities laws of any state, province, territory, county or jurisdiction of the United States or any other restricted jurisdiction. The Shares may not be offered, sold, resold, pledged, taken up, exercised, renounced, transferred, delivered or distributed, directly or indirectly, in or into the United States absent registration, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable state and other securities laws of the United States, or any other restricted jurisdiction. No public offering of the Shares is being, has been or will be made in the United States. Any Shares sold in the United States will be sold only to persons reasonably believed to be qualified institutional buyers (as defined in Rule 144A under the Securities Act) in reliance on Rule 144A under the Securities Act. The information contained herein and on the following web page does not constitute, and should not be construed as, an offer to sell or solicitation of an offer to buy any of the Shares in the United States, "general solicitation or general advertising" under Rule 502(c) of Regulation D under the Securities Act or "directed selling efforts" under Regulation S of the Securities Act.

The Shares have not been approved or disapproved by the U.S. Securities and Exchange Commission, any state securities commission in the United States or any other regulatory authority in the United States, nor have any of the foregoing authorities passed comment upon, or endorsed the merit of, the Shares or the accuracy or the adequacy of the information contained herein and on the following web page. Any representation to the contrary is a criminal offence in the United States.

The Shares have also not been, and will also not be, registered under the applicable securities laws of Canada, Australia or Japan and, subject to certain exemptions, may not be offered or sold in or into or for the account or benefit of any person having a registered address in, or located or resident in Canada, Australia or Japan.

Access to the information and documents contained on the following web page may be illegal in certain jurisdictions, and only certain categories of persons may be authorized to access such information and documents. All persons residing outside of Denmark who wish to have access to the documents contained on the following web page should first ensure that they are not subject to local laws or regulations that prohibit or restrict their right to access the following web page or require registration or approval for any acquisition of securities by them. No such registration or approval has been obtained outside Denmark. The Company assumes no responsibility if there is a violation of applicable law and regulations by any person.

No information included on the following web page should be used by investors in forming their investment decision as to an investment in the Shares.

By clicking on the [“Accept”] button below, you certify that (i) you have read and understood the foregoing and (ii) you are not restricted by the laws of your country of residence or any other law to which you are subject to access the following web page.

Accept Decline

Company Announcement Details

Alm. Brand - Preliminary statement of financial results for 2018

Disclaimer