Alm. Brand - Alm. Brand A/S - Interim Report for H1 2019

Alm. Brand A/S - Interim Report for H1 2019

August 20, 2019

20 August 2019
Announcement no. 52/2019

Alm. Brand A/S – Interim report for H1 2019

Alm. Brand generated a pre-tax profit of DKK 370 million in H1 2019, which was highly satisfactory and better than expected. On this basis, the full-year guidance is raised by DKK 50 million to a profit of DKK 625-725 million.

Alm. Brand once again delivers guidance outperformance, allowing us to raise our full-year profit guidance to DKK 625-725 million. I’m extremely pleased with our performance, said CEO of Alm. Brand A/S Søren Boe Mortensen. He continued:
The upgrade is based on a stronger-than-expected performance of Non-life Insurance. Both Life Insurance and Banking performed in line with expectations.
We’re experiencing significantly stronger activity, especially in the bank, which saw an increase in the number of group-wide customers and new lending. However, due to our customers’ increasing propensity to save up and convert bank loans into mortgage loans, lending did not increase at the same rate. On the other hand, Financial Markets is experiencing a high level of activity with new customers and strong investment appetite, explained Søren Boe Mortensen, adding:
We’re very pleased to note that many of the bank’s new customers are referrals from the group’s other business areas. This shows that our ambitious strategy of aiming to assist customers with all of their financial needs is beginning to show results, he emphasised.

Q2 performance

Non-life Insurance delivered a satisfactory pre-tax profit of DKK 122 million in Q2 2019, which was better than expected.

The combined ratio was 89.9, being favourably affected by run-off gains and a lower level of expenses for both minor and major claims. These were to some extent offset by increased building insurance claims expenses and a significantly lower discount rate.

Premiums increased by 1.6% relative to Q2 2018. The commercial customer segment grew by 2.6%, while growth in the private customer segment was 0.6%, which was less than anticipated. Customer retention remained high in both segments.

The investment result was a loss of DKK 13 million, which was attributable to the hedging of technical provisions producing an overall negative return as a result of the lower VA premium in the second quarter of 2019.

Life Insurance generated a satisfactory pre-tax profit of DKK 21 million, which was in line with expectations.

Pension contributions amounted to DKK 392 million, which was satisfactory. Total portfolio premiums increased by 6.5% year on year.

The bonus rate was 13.7 at 30 June 2019. This was satisfactory in light of the substantial interest rate decline that translated into an extraordinary decline in the VA premium. The bonus rate remained at a satisfactory level, ensuring that Alm. Brand Pension may continue to offer competitive rates on policyholders’ savings.

Banking generated a profit of DKK 15 million. The performance was favourably affected by a high level of activity and new customers in Financial Markets, profit from Leasing, impairment writedown reversals and an extraordinary capital gain. However, very low interest rates, tough competition and higher costs related to compliance with regulatory requirements detracted from performance. While the overall profit was in line with expectations, the profit composition was not satisfactory.

The bank generally experienced an increase in the level of activity in the second quarter. Accordingly, the number of Pluskunder grew by 7% in the first six months of the year and by 3% in the second quarter alone, and the customer inflow and the level of activity in Financial Markets were also very satisfactory.

As a result of continued customer inflows, new lending also increased. However, this trend was partly offset by a generally higher propensity to save up, quicker debt repayment and a surge in the conversion of bank loans into mortgage loans.

The portfolio of Totalkredit loans increased by DKK 0.5 billion in Q2 2019, driven by remortgaging and new lending.

Outlook

The full-year guidance is lifted by a total of DKK 50 million to a pre-tax profit of DKK 625-725 million.
The guidance for Non-life Insurance is lifted by DKK 50 million to a profit of about DKK 600 million, while the guidance for Life Insurance and Banking is unchanged. The upgrade is primarily driven by realised run-off gains. The outlook for the year does not include run-off gains or losses for the rest of 2019.

Webcast and conference call
Alm. Brand will host a webcast and conference call on 20 August 2019 at 10.00 a.m.

https://almbrand.eventcdn.net/201908H1

Financial analysts are invited to participate by phone: Danish analysts: +45 70 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, tel. +45 35 47 79 07, or Susanne Biltoft, Director, Communications, 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 A/S - Interim Report for H1 2019

Disclaimer