Alm. Brand A/S – Interim report Q3 2022

Company announcement no. 20/2022

Interim report Q3 2022

The monetary outcomes of Alm. Brand Group (on this report known as “Alm. Brand Group” or “the group”) for Q3 2022 embrace the outcomes of Alm. Brand Forsikring (“Alm. Brand”) and different actions in addition to the outcomes of the acquired Danish business of Codan Forsikring (“Codan”). Comparative figures for Q3 2021 are based mostly on reported figures excluding Codan, and natural development thus solely displays developments in Alm. Brand’s persevering with actions.

• Alm. Brand Group’s gross premium revenue greater than doubled to DKK 2,902 million in Q3 2022 after recognition of Codan and supported by sustained extremely passable natural development of 5.1% in Alm. Brand.
• The technical consequence grew to a revenue of DKK 370 million in Q3 2022 from DKK 170 million in Q3 2021, reflecting an total passable claims expertise, realised synergies and a constructive impact on claims provisions because of a better rate of interest degree.
• Negative monetary market developments in August and September resulted in a complete loss on investments of DKK 63 million in Q3 2022, in opposition to a acquire of DKK 8 million in Q3 2021.
• In mid-October, Alm. Brand Group lifted its revenue steerage, thus sustaining the steerage for the technical consequence at DKK 1,050-1,100 million excluding run-off beneficial properties and losses within the ultimate quarter of the 12 months.

CEO Rasmus Werner Nielsen:

“We’re off to a good start as a combined group, and we’re already seeing the first positive effects of the combination of Codan and Alm. Brand. At the same time as the expected synergies are starting to feed through to the bottom line, we’re maintaining the past many quarters’ strong momentum in our insurance operations. In addition, the positive trend in premium income and continued customer on-boarding show that our customers really support Alm. Brand Group. We’re continuing the process of strengthening our customer value proposition by combining the best of both companies as well as executing on the integration process.”

The technical consequence amounted to a revenue of DKK 370 million in Q3 2022, in opposition to DKK 170 million in Q3 2021, composed of a technical results of DKK 258 million for Alm. Brand and DKK 112 million for Codan. In a number of methods, the consequence displays a passable pattern, with profitability-enhancing measures and realisation of synergies making up for increased common claims restore prices, and with a better rate of interest degree, seen in isolation, decreasing the quantity of claims provisions.

The funding consequence was a lack of DKK 63 million in Q3 2022. Seen in isolation, the result’s unsatisfactory however needs to be seen in gentle of 1 / 4 with damaging monetary market developments within the ultimate a part of the interval, leading to a continued decline in fairness costs, rate of interest will increase and credit score unfold widening.

Other actions reported a pre-tax lack of DKK 13 million, together with group bills and the results of the mortgage deed and debt assortment portfolio. Alm. Brand Group thus generated a pre-tax revenue on persevering with actions of DKK 294 million earlier than particular prices in Q3 2022, in opposition to a pre-tax revenue of DKK 174 million in Q3 2021.

The Q3 consequence consists of particular prices of DKK 60 million associated to the mixing of Codan and realisation of synergies. in addition to amortisation of intangible property within the quantity of DKK 90 million, bringing the group’s consolidated revenue for Q3 2022 to a pre-tax revenue of DKK 144 million.

The mixed ratio was 87.3 after recognition of Codan’s outcomes. For Alm. Brand, the mixed ratio was 82.2 in Q3 2022, in opposition to 87.7 in Q3 2021, with enhancements in each the claims expertise and the expense ratio.

Synergies and different price initiatives

In reference to the acquisition of Codan, Alm. Brand Group introduced that it anticipated to understand synergies of DKK 600 million with accounting impact in 2025. After the acquisition of Codan, numerous initiatives have been applied, primarily to eradicate duplicate group capabilities and to understand scale economies in claims providers, which can produce synergies of DKK 110 million with accounting impact in 2022, DKK 54 million of which had a beneficial impact on outcomes at 30 September 2022. The accounting impact of realised synergies will produce an annual acquire of DKK 200 million as from 2023.

Alm. Brand Group will repeatedly launch details about developments within the realisation of synergies within the interval till 2025.

In addition, an organisational discount affecting 110 positions has been applied, the vast majority of which had been effected by discontinuation of vacant positions. The discount was applied throughout the organisation with a major contribution from bancassurance. This initiative is applied at the start to handle the price degree in Codan, which after the acquisition has proved increased than initially anticipated. The price financial savings ought to thus be seen as a major step in direction of guaranteeing a passable degree of economic outcomes for the group.

Outlook for 2022

Alm. Brand Group’s revenue for 2022 would be the sum of the revenue generated by Alm. Brand Forsikring and different actions for the complete monetary 12 months and the revenue generated by Codan for the interval from 1 May 2022 to 31 December 2022, together with realised synergies. Alm. Brand Group’s revenue steerage was most not too long ago up to date in reference to the discharge of firm announcement no. 19/2022 of 13 October 2022.

Alm. Brand Group expects to report a technical results of DKK 1,050-1,100 million excluding run-off beneficial properties and losses within the ultimate quarter of the 12 months. The revenue is anticipated to be distributed on roughly DKK 800 million from Alm. Brand and roughly DKK 275 million from Codan, together with anticipated synergies of DKK 110 million in complete for the 2 firms.

The steerage is predicated on gross premium revenue of DKK 9.5 billion for the group, in opposition to the earlier steerage of DKK 9.3-9.4 billion, pushed by natural development of about 5% in Alm. Brand, in opposition to the 4-5% beforehand guided. Moreover, Codan is anticipated to report gross premium revenue of about DKK 3.8 billion, in opposition to the earlier steerage of about DKK 3.7 billion.

The steerage is unchanged for the mixed ratio at round 89 in addition to for the expense ratio at round 18.

Alm. Brand Group expects to report a loss on investments of DKK 350 million because of hostile monetary market developments and consequent capital losses on shares and bonds.

The steerage for different actions is unchanged at a lack of DKK 100 million.

Alm. Brand Group thus expects to report a consolidated revenue on persevering with actions of DKK 600-650 million earlier than particular prices.

In addition, Alm. Brand Group nonetheless expects to incur particular prices of about DKK 430 million in 2022, comprising prices in reference to the mixing of Codan and realisation of synergies of DKK 350 million, prices for the divestment of Alm. Brand Liv og Pension A/S of DKK 60 million and prices associated to the chapter of Gefion Insurance of DKK 20 million. Moreover, Alm. Brand Group will recognise amortisation of intangible property in an quantity of DKK 240 million.

Financial targets

Alm. Brand Group will host a gathering for institutional traders and fairness analysts (Capital Market Update) on 22 November 2022 and can in that connection launch up to date monetary targets for 2025.

Webcast and convention name

Alm. Brand will host a convention name for traders and analysts immediately, Thursday 10 November 2022 at 11:00 a.m. The convention name and presentation might be out there on Alm. Brand’s investor web site, right here.

Conference name dial-in numbers for traders and analysts (pin: 136433):

Denmark: +45 8987 5045
United Kingdom: +44 203 936 2999
USA: +1 646 664 1960

Link to webcast: right here.

Contact

Please direct any questions concerning this announcement to:

Investors and fairness analysts:                 

Head of Investor Relations                Senior Investor Relations Officer
Mads Thinggaard                 Mikael Bo Larsen
Mobile no. +45 2025 5469                Mobile no. +45 5143 8002

Press:        

VP, Communication & Sustainability
Emilie Wedell-Wedellsborg
Mobile no. +45 20 32 65 30

• AS 20 2022 – Preliminary assertion of economic outcomes Q3 2022
• Alm. Brand Group Q3 2022