21.10.2014

Third quarter 2014:Continued solid premium growth and good profit performance

The Gjensidige Insurance Group recorded a profit before tax for the quarter of NOK 1,336.7 million (1,673.3). The profit from general insurance operations measured by the underwriting result was NOK 755.0 million (852.5). For the investment portfolio, the return on financial assets was 1.0 per cent (1.5), or NOK 552.0 million (825.7). The profit after tax was NOK 997.7 million (1,328.2), corresponding to NOK 2.00 (2.66) per share. The underwriting result was driven by a solid growth in premiums and a good underlying claims development, but it was negatively affected by more claims relating to thunder and lightning. The proportion of large losses was higher than in the corresponding period last year, among other things as a result of a torrential downpour in Denmark and Sweden at the end of August. The overall level of large losses was nonetheless lower than is normally expected. Both the Retail Bank and Pension and Savings have improved their profit performance since the same period last year as a result of volume growth. The financial result in the quarter was satisfactory given the challenging interest rate situation.

- I am very pleased that we manage to combine continued solid growth with good profitability, says CEO Helge Leiro Baastad. - The result reflects good operations and confirms that our work on risk selection, price adjustments and process improvements is paying off in a market characterised by strong competition, says Baastad.

The Group recorded a profit before tax expense for the year to date of NOK 4,240.5 million (3,291.0). The profit from general insurance operations measured by the underwriting result was NOK 2,055.1 million (1,643.9). For the investment portfolio, the return on financial assets was 3.6 per cent (2.8), corresponding to NOK 2,059.0 million (1,603.2). The profit after tax expense was NOK 3,225.5 million (2,536.1), corresponding to NOK 6.45 (5.07) per share. The underwriting result was positively influenced by a solid growth in premiums of 8.6 per cent and good cost control. The underlying claims development was also good, among other things as a result of favourable weather conditions. A higher proportion of large losses was partly compensated by a somewhat higher run-off gain. Gjensidige Bank’s profit performance was good in the period, driven by volume growth and efficient operations. Pension and Savings also recorded a positive profit performance.

Gjensidige launched a subordinated bond issue with of NOK 1.2 billion in the quarter. The Board has decided that excess capital in the amount of NOK 2.0 billion, or NOK 4.00 per share, will be distributed as extra dividend and that the profitability targets for the general insurance operations will continue to apply.

Highlights third quarter 2014 (third quarter 2013):

  • Profit/loss before tax expense: NOK 1,336.7 million (1,673.3)
  • Profit per share: 2.00 (2.66)
  • Earned premiums: NOK 5,203.6 million (4,866.9)
  • Underwriting result: NOK 755.0 million (852.5)
  • Combined ratio: 85.5 (82.5)
  • Cost ratio: 14.5 (14.8)
  • Financial result: NOK 552.0 million (825.7)

Highlights year to date 2014 (year to date 2013):

  • Profit/loss before tax expense: NOK 4,240.5 million (3,291.0)
  • Profit per share: 6.45 (5.07)
  • Earned premiums: NOK 15,172.4 million (13,970.6)
  • Underwriting result: NOK 2,055.1 million (1,643.9)
  • Combined ratio: 86.5 (88.2)
  • Cost ratio: 14.9 (15.3)
  • Financial result: NOK 2,059.0 million (1,603.2)

Contact:

Analysts and investors: Head of Investor Relations Janne Flessum, tel.: + 47 915 14 739
Investor Relations Officer Linn Soltvedt, tel.: + 47 411 10 555

Press: Head of Media Relations Øystein Thoresen, tel.: + 47 952 33 382

This information is subject to disclosure under the Norwegian Securities Act section §5-12.