Storebrand ASA 3rd quarter 2012: Positive result development - cost programme progressing according to plan
- Group profit of NOK 458 million for 3rd quarter and NOK 1 471 million year to date.
- Cost programme to reduce annual costs by NOK 400 million is progressing according to plan.
- Implementation of price increases and conversion activities for guaranteed products in both Norway and Sweden.
The Board of Director's Interim report for 3Q 2012, 3Q 2012 result presentation and Supplementary Information are attached on http://www.newsweb.no
Storebrand will today host a press and analyst conference in Storebrands head office at Lysaker, Professor Kohts vei 9, at 1015 CET (in Norwegian). An international conference call will be hosted at 1500 CET. To participate in the conference call please use link on http://www.storebrand.no/ir, or call in and register 10 minutes before the presentation starts. Dial in number: +47 23184536.
Full press release:
3rd quarter 2012:
Positive result development - cost programme progressing according to plan
- Group profit of NOK 458 million for 3rd quarter and NOK 1 471 million year to date.
- Cost programme to reduce annual costs by NOK 400 million is progressing according to plan.
- Implementation of price increases and conversion activities for guaranteed products in both Norway and Sweden.
Group profit before amortisation and write-downs of intangible assets was NOK 458 million for the 3rd quarter.
-Storebrand has delivered competitive returns to customers and the result development is positive. Measures to reduce cost and prepare for the changes in the pension market is well underway and progressing according to plan, states CEO Odd Arild Grefstad.
The measures in the cost programme to reduce annual costs by NOK 400 million within 2014 is being implemented and is progressing according to plan. Restructuring costs of NOK 181 million related to the cost programme have been charged against the Group profit in the 3rd quarter.
In order to increase capital efficiency, it has been decided to introduce a fee for new paid-up policies and increase the price of the interest rate guarantee for defined benefit pension schemes in the private sector. Price increases for guaranteed products have also been implemented in SPP. Storebrand is working actively to convert customers from guaranteed products to unit linked insurance in both Norway and Sweden.
Storebrand Life Insurance: Competitive returns
The quarter has been characterized by rising equity markets in Norway and internationally. Market returns have been above interest rate guarantee levels in most portfolios. Market return in guaranteed portfolios was 2,0 percent for the quarter and 4.5 percent year to date.
Storebrand has delivered competitive returns in the defined contribution portfolios. Storebrand Balanced Pension has delivered a return of 5.1 percent for the quarter and 9,7 percent year to date.
Sales have been strong in the occupational pensions market, and booked net transfer to Storebrand was NOK 1 297 billion in the 3rd quarter.
SPP: Stable result, positive returns
Returns for the customer portfolios in SPP have been good and provided a basis for profit sharing and indexation fee in all customer portfolios. The underlying administration result performance has been satisfactory.
Asset Management: Weak result, growth in AUM
Assets under management have increased by NOK 15 billion to NOK 439 billion in the 3rd quarter. Storebrand has achieved an excess return of NOK 1.1 billion for its customers during the quarter. The result is characterized by weaker income growth as a result of the shift towards products with lower margins and provisions for restructuring measures as part of the Group's cost programme. Measures to reduce costs and increase profitability are being implemented.
Storebrand Bank: Growth in loans, strong portfolio
The result development in Storebrand Bank has been positive and the quality of the customer portfolio is good. Sales results continue to show a positive trend, with lending growth in both retail and corporate markets. The interest rate margin was 1.21 percent for the 3rd quarter.
Insurance: Positive risk development, efficient operations
Storebrand Insurance continues to show a positive financial performance. Combined ratio was 85 per cent per year to date. The results reflect good underlying risk performance in the portfolio and the organisation's operations are efficient. Premium income was up 7 percent compared with last year.
Solvency ratio
The solvency ratio of Storebrand Life insurance Group (Storebrand Life Insurance and SPP) was 153 percent. This is one percentage point higher than at the end of the 2nd quarter.
Lysaker, 24 october 2012
Contacts:
Director of Public Affairs Jan Otto Risebrobakken: Mobile +47 48 08 26 02
Head of Investor Relations Trond Finn Eriksen: Mobil +47 99 16 41 35
Enclosure: Board of Director's Interim Report for 3rd quarter 2012
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act