First quarter 2013: Good start to the year

The Group recorded a profit before tax for the first quarter of NOK 541 million (1,427). The result includes the previously announced impairment loss of NOK 611 million on the investment in Storebrand.

The profit from general insurance operations measured by the underwriting result was NOK 343 million (506). The decline in the result from the corresponding period last year was primarily due to lower run-off gains and a higher proportion of large losses. However large losses were lower than what is normally expected. Good underlying profitability in the general insurance portfolio and no significant, negative weather effects contributed to a good underwriting result in the quarter.

‘We are pleased with the start to 2013. The results are driven by solid premium growth, good underlying operations and cost efficiency,’ says Helge Leiro Baastad, chief executive officer. ‘We received several awards for good customer service this quarter, which represent an important recognition of our  efforts to strengthen customer orientation in all parts of the organisation,’ Baastad says.
 
Earned premiums in the Private segment increased by 3.0 per cent, mainly driven by higher premiums. Lower run-off gains led to a decline in the underwriting result.

The Commercial segment experienced some growth in premiums despite the loss of two large customers after the first quarter last year. A higher proportion of large losses and a somewhat more normal weather situation than in the corresponding period last year contributed to a lower underwriting result.

Earned premiums developed positively in the Nordic segment, with premiums growing by 5.9 per cent, primarily as a result of an increase in the number of new customers. Lower run-off gains combined with a slightly higher proportion of large losses contributed to a decline in the underwriting result.

The Baltics recorded a positive profit performance as a result of improvement in the Baltic insurance market, which led to a growth in premiums of as much as 15.5 per cent.

Gjensidige’s bank recorded a strong profit performance, driven by an increase in net interest income and lower operating expenses, write-downs and losses. Pensions and Savings also recorded a positive profit performance in the quarter.

The return on financial assets in the investment portfolio was 0.3 per cent (1.6), or NOK 173 million (909). The return, excluding the impairment loss on the investment in Storebrand, was satisfactory.

Highlights first quarter 2013 (first quarter 2012): 

• Profit before tax expense: NOK 541 million (1,427)
• Profit per share: NOK 0.63 (2.18)
• Earned premiums: NOK 4,457 million (4,354)
• Underwriting result: NOK 343 million (506)
• Combined ratio: 92.3 (88.4)
• Cost ratio: 15.7 (15.7)
• Financial result: NOK 173 million (909)
• An impairment loss on the investment in Storebrand was recognised in the amount of NOK 611 million in the quarter
• It is the Board of Directors’ intention that the impairment loss shall not affect the basis for dividend for 2013
• Ordinary dividend adopted for 2012: NOK 3,425 million, corresponding to NOK 6.85 per share

Head of Information Øystein Thoresen. Tel: 47 952 33 382
IR director Janne Merete Flessum Tel:  47 915 14 739
IR officer Linn Therese Soltvedt, Tlf: 47 411 10 555

Gjensidige is a leading Nordic insurance group built by customers, for customers. The Group has been listed on the Oslo Stock Exchange since 2010. For nearly 200 years, we have worked passionately to secure the lives, health and assets of our customers. We have about 3,100 employees and offer insurance products in Norway, Denmark, Sweden and the Baltic states. In Norway, we also offer banking, pension and savings. Operating income was NOK 19.5 billion in 2012, while total assets was NOK 94.2 billion.