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Uniqa Insurance Group AG

Quarterly Report May 28, 2010

764_rns_2010-05-28_73eaa2e5-30c3-4996-bcfa-79efb9c1fc30.pdf

Quarterly Report

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1st Quarter Report 2010 UNIQA Versicherungen AG

Group Key Figures

1–3/2010 1–3/2009 Change
€million €million %
Premiums written
Recurring premiums 1,506 1,430 +5.3
Single premiums 242 213 +13.5
Total 1,748 1,643 +6.4
of which savings portion of premiums from unit-linked and index-linked life insurance 155 168 –7.6
Group premiums (according to IFRS)
Property and casualty insurance 603 567 +6.4
Health insurance 248 233 +6.5
Life insurance 478 413 +15.7
Total 1,330 1,213 +9.6
Insurance benefits1)
Property and casualty insurance –428 –364 +17.6
Health insurance –222 –211 +5.3
Life insurance2) –540 –420 +28.7
Total –1,190 –995 +19.7
Operating expenses3)
Property and casualty insurance –208 –192 +8.5
Health insurance –37 –30 +23.9
Life insurance –87 –88 –1.7
Total –332 –310 +7.1
Net investment income 250 146 +70.6
Investments 23,690 21,353 +10.9
Profit on ordinary activities 43 31 +38.7
Net profit 27 19 +39.5
Consolidated profit 21 28 –27.1
Insured capital in life insurance 67,223 64,187 +4.7

1) Incl. expenditure for deferred profit participation and premium refunds.

2) Incl. expenditure for (deferred) profit participation.

3) Incl. reinsurance commissions and profit shares from reinsurance business ceded.

Key figures UNIQA shares 1–3/2010 1–3/2009 Change
%
Share price as at 31.3. 10.68 16.00 –33.3
High 12.97 18.86
Low 10.68 13.75
Market capitalisation as at 31.3. in €million 1,527 2,107 –27.5
Earnings per share 0.14 0.22 –32.9
Information UNIQA shares
Securities abbreviation UQA
Reuters UNIQ.VI
Bloomberg UQA.AV
ISIN AT0000821103
Market segment Prime Market, Vienna Stock Exchange
Trade segment Official trading
Indices ATXPrime, WBI
Number of shares 142,985,217
Financial Calendar
Annual General Meeting 31 May 2010
Ex Dividend Day, Dividend Payment Day 14 June 2010
Half-Year Financial Report 2010, Conference Call 27 August 2010
1st to 3rd Quarter Report 2010, Conference Call 26 November 2010

Group Management Report

Group premiums have risen to €1,748 million after three months of 2010.

Profit before taxes at €43 million.

Economic environment

The GDP in the euro zone remained unchanged in the 4th quarter of 2009. In the first three months of 2010, the euro countries grew by 0.2% compared to the closing quarter of 2009 (0.8% annualised). This weak performance is partially the result of the hard winter, which heavily impacted the construction industry. Significantly larger gains of over 0.5% are expected in the 2nd quarter. The growth situation in Spain, Italy and Portugal improved somewhat in the 1st quarter of 2010. However, no real easing of the situation in Greece can be seen. An intensification of the debt situation in the above-mentioned countries could become a problem. For the moment, only Greece is affected. However, there is a risk that the problems could also carry over to Portugal, Spain, Italy and Ireland. Growth throughout the entire euro zone could be weighed down heavily by this. Inflation remains a non-issue, with core inflation falling and already significantly below 1%.

In the USA, the GDP grew in the 1st quarter of 2010 by 3.2% (annualised). This growth was somewhat slower than in the 4th quarter but still above the long-term potential. The recovery process has therefore continued in the US economy. March even saw the return of strong growth in employment for the first time. Many analysts have already made upward corrections to the growth estimates for the USA. The better growth data in the USA led to a strong recovery of the US dollar against the euro, and this appreciation naturally also played a role in the debt problems in the euro zone. Core inflation should continue to fall due to low capacity utilisation and persisting high unemployment. For this reason, no inflation risk exists in the USA either. The prime rates are therefore unlikely to change again before the end of the year.

In Eastern Europe, growth is expected in 2010 in all countries except for Hungary and Croatia. The strongest growth rates will be seen in Russia and the Ukraine. The reason for this strong recovery lies on one hand in a return to the past and on the other in the higher raw materials prices. The core countries of Poland, the Czech Republic and Slovakia in particular should achieve solid growth. The budgetary situation in the Eastern European countries can be seen as relatively stable compared with the rest of Europe. For this reason, many central banks have lowered their prime rates and the currencies have also made gains against the euro. The situation in Eastern Europe can therefore be considered more secure than just one year ago.

Accounting regulations, scope of consolidation

The quarterly statement of the UNIQA Group was prepared in accordance with the International Financial Reporting Standards (IFRS) as well as the International Accounting Standards (IAS). This interim financial report has been prepared in accordance with IAS 34. The scope of the fully consolidated group was not significantly expanded as of 31 March 2010.

Premium development

The Group premiums written (including the savings portion from the premiums of unit- and index-linked life insurance) rose in the first three months of 2010 by 6.4% to €1,748 million (2009: €1,643 million). Premiums in the product areas with recurring premiums rose during the period by 5.3% to €1,506 million (1–3/2009: €1,430 million). The single premium business grew by 13.5% to € 242 million (1–3/2009: €213 million).

Including the net savings portions of premiums from unit- and indexlinked life insurance at a value of €153 million (1–3/2009: €175 million), the premium volume earned rose by 6.8% to € 1,483 million (1–3/2009: €1,388 million) in the 1st quarter of 2010. The retained premiums earned (according to IFRS) even grew by 9.6% to €1,330 million (1–3/2009: €1,213 million).

Due to the decline in the area of unit- and index-linked life insurance, the premiums in Austria fell by 1.0% to €1,067 million (1–3/2009: €1,078 million). On the other hand, the recurring premium business recorded a remarkable increase of 3.7% to €1,021 million on the Austrian market in the first three months of 2010 (1–3/2009: €985 million). In contrast, sales of single premium products were halved to €46 million (1–3/2009: €93 million). The retained premiums earned (according to IFRS) increased by 2.4% to €800 million (1–3/2009: €782 million).

The premiums of the Group companies in Eastern and South-Eastern Europe grew in the first three months of 2010 by 7.8% to €321 million (1–3/2009: €298 million). As a result, they made up 18.4% (1–3/2009: 18.1%) of the Group premiums. The business volume in Western Europe increased in the 1st quarter of 2010 by 34.3% to reach €359 million (1–3/2009: €268 million) primarily due to strong growth in the Italian life insurance business. The share of international business at the end of the 1st quarter of 2010 was 38.9% (1–3/2009: 34.4%).

Property and casualty insurance

The premium volume written in property and casualty insurance grew in the 1st quarter of 2010 by 4.9% to €835 million (1–3/2009: €797 million). While the premiums in Austria grew by an attractive 3.4% to €476 million (1–3/2009: €460 million), the countries of Eastern and South Eastern Europe grew at roughly three times this rate, increasing their premium volumes by 10.4% to €208 million (1–3/2009: €188 million). As a result, these markets contributed 24.9% (1–3/2009: 23.6%) to the total premiums of the Group in property and casualty insurance. In Western Europe, premium revenue grew slightly by 2.5% to €151 million (1–3/2009: €148 million). This brought Western Europe's share of premiums to 18.1% at the end of the 1st quarter of 2010 (1–3/2009: 18.6%). In total, the international share rose to 43.0% (1–3/2009: 42.2%).

The retained premiums earned (according to IFRS) in property and casualty insurance increased in the first three months of 2010 by 6.4% to €603 million (1–3/2009: €567 million).

Health insurance

The premiums written in health insurance rose in the reporting period by 6.0% to €260 million (1–3/2009: €245 million). In Austria, premium volume grew by 2.4% to €204 million (1–3/2009: €199 million). Internationally, premiums increased by 21.7% to €56 million (1–3/2009: €46 million) to contribute 21.5% (1–3/2009: 18.7%) to the health insurance premiums of the Group.

The retained premiums earned (according to IFRS) increased in the first three months of 2010 by 6.5% to €248 million (1–3/2009: €233 million).

Life insurance

The 1st quarter of 2010 saw positive developments in the area of life insurance. Overall, the premium volume written (including the savings portion from the premiums of unit- and index-linked life insurance) increased by 8.5% to €653 million (1–3/2009: €602 million). While the single premium business rose by 13.5% to €242 million (1–3/2009: €213), the premium volume in recurring premium life insurance grew by 5.7% in the first three months of 2010 to reach €411 million (1–3/2009: €389 million). The risk premium share of unit- and index-linked life insurance included in the premiums totalled €27 million in the 1st quarter of 2010 (1–3/2009: €24 million).

Due to the decline in the area of unit- and index-linked life insurance and in the single premium business, the life insurance premium volume written in Austria fell by 7.4% to €387 million (1–3/2009: €418 million). However, premium revenue from recurring premium payments increased by 4.9% to €342 million (1–3/2009: €326 million). In contrast, single premium revenue fell by 50.5% to €46 million (1–3/2009: €93 million) and the premium volume in the area of unit- and index-linked life insurance declined in the first three months of 2010 by 16.6% to €141 million (1–3/2009: €169 million).

In the Western European markets, the life insurance business progressed very favourably in the 1st quarter of 2010. Overall, the premiums in the first three months grew by 103.8% to €155 million (1–3/2009: €76 million) due to the strong growth in Italy as a result of the very successful cooperation with the Veneto Banca group. Extremely positive developments were seen in both the recurring premium revenue, which grew by 19.9% to €28 million (1–3/2009: €23 million), as well as the single premium business with growth of 141.4% to €127 million (1–3/2009: €52 million).

Life insurance was also able to make gains in Eastern and South-Eastern Europe once again in the 1st quarter of 2010. The premium volume of the UNIQA Group companies in this region rose in the first three months of 2010 by 2.9% to €110 million (1–3/2009: €107 million). Single premiums also increased in the 1st quarter, increasing by 2.3% to €69 million (1–3/2009: €68 million). Recurring premium revenue even increased by 3.9% to €41 million (1–3/2009: €39 million). The share of Eastern Europe within the total life insurance premiums of the Group was 16.9% (1–3/2009: 17.8%). This put the total international share at 40.6% (1–3/2009: 30.5%).

Including the net savings portions of the premiums for the unit- and indexlinked life insurance, the premium volume earned in life insurance in the first three months of 2010 rose by 7.4% to €631 million (1–3/2009: 588 million). The retained premiums earned (according to IFRS) grew by 15.7% to €478 million (1–3/2009: €413 million).

Insurance benefits

Due to the unusual encumbrances in the area of property and casualty and the increased allocation for deferred profit sharing, the total amount of insurance benefits retained by the UNIQA Group in the 1st quarter of 2010 grew by 19.7% to €1,190 million (1–3/2009: € 995 million). The insurance benefits before taking reinsurance into consideration increased marginally less by 18.5% to reach €1,216 million (1–3/2009: €1,026 million). The claims and benefits ratio across all lines increased as a result to 80.2 % (1–3/2009: 71.7%).

Property and casualty insurance

Resulting from an accumulation of major losses in Germany and Hungary and an increased claims load from the winter losses in Poland and the Czech Republic, the loss ratio after reinsurance in property and casualty grew to 70.9% in the 1st quarter of 2010 (1–3/2009: 64.2%). Due to the first consolidation of the Albanian SIGAL Group, the insurance benefits after reinsurance increased in the reporting period by 17.6% to €428 million (1–3/2009: €364 million). Benefits before reinsurance increased by 16.7% to €434 million (1–3/2009: €372 million).

This exceptional development caused the combined ratio after reinsurance to increase in the first three months of 2010 to 105.4% (1–3/2009: 98.0%). Before taking reinsurance into consideration, the combined ratio was 101.9% (1–3/2009: 94.5%).

Health insurance

The retained insurance benefits (including the change in the actuarial provision) increased in the first three months of 2010 by 5.3% to €222 million (1–3/2009: €211 million).

Life insurance

In life insurance, the retained insurance benefits (including the change in the actuarial provision) increased by 28.7 % to € 540 million (1–3/2009: €420 million), largely due to the change in the deferred profit participation as a consequence of the positive development of the net investment income.

Operating expenses

The total operating expenses for the insurance business, not including reinsurance commissions received, increased in the 1st quarter of 2010 by 7.1 % to € 332 million (1–3/2009: € 310 million) due to investments in the expansion of sales in Italy and Romania, investments in brand recognition and initial consolidation effects (SIGAL Group). Acquisition expenses rose at the same time by 8.1 % to € 228 million (1–3/2009: € 211 million). Other operating expenses grew only marginally by 4.9 % to € 104 million (1–3/2009: € 99 million). As a result of this, the cost ratio, i.e. the relationship of all operating costs to the Group premiums earned, including the savings portion of the premiums from unit- and index-linked life insurance as well as the reinsurance commissions received, remained nearly unchanged after three months of 2010 at 22.4 % (1–3/2009: 22.3 %).

Property and casualty insurance

Total operating expenses in property and casualty insurance increased in the reporting period by 8.5% to €208 million (1–3/2009: €192 million). Acquisition costs increased by 6.5% to €136 million (1–3/2009: €128 million) and other operating expenses increased due to initial consolidation effects (SIGAL Group)by 12.5% to €72 million (1–3/2009: €64 million). The cost ratio in property and casualty insurance, including the reinsurance provisions received, was at 34.5% after the first three months of 2010 (1–3/2009: 33.8%).

Health insurance

Total operating expenses in health insurance increased in the first three months of 2010 by 23.9 % to € 37 million (1–3/2009: €30 million). Acquisition costs increased here by 19.5 % to €24 million (1–3/2009: €20 million). Other operating expenses (incl. reinsurance commissions received) rose to €13 million during the period under review (1–3/2009: €10 million). The cost ratio in health insurance was 14.9% in the 1st quarter of 2010 (1–3/2009: 12.8%).

Life insurance

In life insurance, the total operating expenses decreased in the first three months of 2010 by 1.7% to €87 million (1–3/2009: €88 million). Acquisition costs increased by 7.7% to €68 million (1–3/2009: €63 million) due to the increased business volume, but other operating expenses dropped by 25.1% to €19 million (1–3/2009: €25 million). Including the reinsurance commissions received, the cost ratio in life insurance fell to 13.7% as a result of this development (1–3/2009: 15.0%).

Investments

The investment portfolio of the UNIQA Group (including land and buildings used by the Group, real estate held as financial investments, shares in associated companies and the investments of unit- and indexlinked life insurance) as at 31 March 2010 was above the value at yearend 2009 by 4.6% at €23,690 million (31.12.2009: €22,641 million). The net investment income increased in the first three months of 2010 by 70.6% to €250 million (1–3/2009: €146 million).

Profit on ordinary activities increased in 1st quarter of 2010 to €43 million

The profit on ordinary activities of the UNIQA Group increased in the 1st quarter of 2010 compared with the same period of the previous year by 38.7% to €43 million (1–3/2009: €31 million). The net profit rose by 39.5% to € 27 million (1–3/2009: €19 million). In contrast, the consolidated profit fell by 27.1% to €21 million (1–3/2009: €28 million) due to the increased minority share. The earnings per share were €0.14 (1–3/2009: €0.22).

Own funds and total assets

The total equity of the UNIQA Group increased in the first three months of 2010 by €138 million compared to the last balance sheet date to reach €1,702 million (31.12.2009: €1,565 million). This included shares in other companies amounting to €239 million (31.12.2009: €232 million). The total assets of the Group as at 31 March 2010 were €28,406 million (31.12.2009: € 27,393 million).

Cash flow

The cash flow from operating activities rose in the 1st quarter of 2010 to €446 million (1–3/2009: €379 million). Cash flow from investing activities of the UNIQA Group, corresponding to the investment of revenue inflow during the reporting period, amounted to € –581 million (1–3/2009: € –349 million). The financing cash flow was €0 million (1–3/2009: € –6 million). In total, the amount of liquid funds changed by € –135 million (1–3/2009: €24 million).

Employees

The average number of employees in the UNIQA Group increased to 15,120 in the 1st quarter of 2010 (1–3/2009: 13,699) due to full consolidation for the first time of the companies of the sub-group PKB Privatkliniken Beteiligungs GmbH and the Albanian SIGAL Group.

International companies

The premium volume written (incl. the savings portion of premiums from unit- and index-linked life insurance) outside of Austria increased during the 1st quarter of 2010 by an impressive 20.4% to €680 million (1–3/2009: €565 million). In Western Europe, the business volume rose by 34.3% to € 359 million (1–3/2009: €268 million). The companies in Eastern and South-Eastern Europe were also able to increase their premiums during the first three months. In these regions, the premium income grew by 7.8% to €321 million (1–3/2009: €298 million). This put the level of internationalisation of the UNIQA Group, measured based on premium volume, at 38.9% (1–3/2009: 34.4%). The share of Eastern Europe reached 18.4% (1–3/2009: 18.1%), while the share of Western Europe was 20.6% (1–3/2009: 16.3%). Total insurance benefits retained in the international Group companies increased by 28.7% to €451 million in the 1st quarter of 2010 (1–3/2009: €351 million).

Capital market and UNIQA shares

The positive share price developments in the last week of the previous year initially continued at the start of the year 2010 without interruption. However, negative economic data led to growing worries as of mid-January of a "double-dip" recession (a second economic low point). In an environment marked by anxiety, a volatile sideways movement was seen on the markets in the middle of the quarter. Largely positive macroeconomic data coupled with dwindling fears of inflation finally brought about another round of growth as of the end of February, which led to annual highs on most exchanges toward the end of the quarter.

As was the case in the 4th quarter of 2009, the US stock index DOW JONES INDUSTRIAL (DJI) was able to overcome the phase of volatility especially quickly. At 31 March 2010, the index reached 10,856.63 points to close 4.1% above the value at the end of 2009. Comparably weaker economic data and the continued discussion of the financial situation of some euro countries weighed on the price developments on the European stock exchanges: The DJ EURO STOXX 50 remained 1.2% below the value at the end of 2009, finishing the quarter at 2,931.16 points. The CEE countries were able to positively differentiate themselves from the other European countries in the 1st quarter of 2010 as a result of higher growth forecasts and overall better debt ratios. Thanks to the especially strong upward movement in March 2010, the Eastern European index CECE was able to grow 11.9% to 2,044.65 points.

The Vienna Stock Exchange developed better in the 1st quarter of 2010 than most Western European stock exchanges: the leading index ATX gained 5.5% to reach 2,634.00 points. Major price gains in the last weeks of the 1st quarter were responsible for this rise. These price gains reflect a more sympathetic international environment and improved prospects for the CEE countries.

The UNIQA shares were not yet included in this development during the 1st quarter and finished at €13.15 on 31 March. Following this, the development of the share price picked up pace to achieve a performance of +42.3 % in April 2010. This brought the price of the UNIQA shares on 26 May 2010 to €14.50. Relative to the start of the year, this represents growth of 11.8%.

Development of UNIQA shares

Significant events subsequent to the balance sheet date

No significant events took place after the balance sheet date that required reporting.

Outlook

If the expectations of a slight economic recovery prove accurate, UNIQA continues to expect stable development of the operating results. Under the assumption that no negative surprises arise on the capital markets and assuming storm events comparable to those of 2009, UNIQA considers an increase in the Group profit before taxes up to roughly €120 million to be possible in 2010.

Consolidated Balance Sheet

Assets 31.3.2010 31.12.2009
€million €million
A. Tangible assets
I. Self-used land and buildings 279 230
II. other tangible assets 108 132
388 363
B. Land and buildings held as financial investments 1,398 1,433
C. Intangible assets
I. Deferred acquisition costs 903 877
II. Goodwill 612 607
III. Other intangible assets 31 32
1,546 1,516
D. Shares in associated companies 703 717
E. Investments
I. Variable-yield securities
1. Available for sale 1,519 1,321
2. At fair value through profit or loss 752 706
2,271 2,027
II. Fixed interest securities
1. Held to maturity 340 340
2. Available for sale 10,573 9,880
3. At fair value through profit or loss 254 247
11,168 10,467
III. Loans and other investments
1. Loans 2,691 2,943
2. Cash at credit institutions/cash at banks 1,313 1,202
3. Deposits with ceding companies 134 136
4,138 4,281
IV. Derivative financial instruments 21 12
17,597 16,787
F. Investments held on account and at risk of life insurance policyholders 3,713 3,474
G. Share of reinsurance in technical provisions 748 766
H. Share of reinsurance in technical provisions held on account and at risk of life insurance policyholders 386 382
I. Receivables including receivables under insurance business 1,130 1,020
J. Receivables from income tax 40 40
K. Deferred tax assets 94 96
L. Liquid funds 664 798
Total assets 28,406 27,393
Equity and liabilities 31.12.2009
€million €million
A. Total equity
I. Shareholders' equity
1. Subscribed capital and capital reserves 541 541
2. Revenue reserves 774 725
3. Revaluation reserves 93 11
4. Group total profit 57 57
1,464 1,333
II. Minority interests in shareholders' equity 239 232
1,702 1,565
B. Subordinated liabilities 575 575
C. Technical provisions
I. Provision for unearned premiums 776 553
II. Actuarial provision 16,254 16,055
III. Provision for outstanding claims 2,317 2,300
IV. Provision for profit-unrelated premium refunds 32 48
V. Provision for profit-related premium refunds, i.e. policyholder profit sharing 349 197
VI. Other technical provisions 49 48
19,776 19,200
D. Technical provisions held on account and at risk of life insurance policyholders 3,630 3,416
E. Financial liabilities 81 82
F. Other provisions 649 659
G. Payables and other liabilities 1,588 1,534
H. Liabilities form income tax 53 49
I. Deferred tax liabilities 351 312
Total equity and liabilities 28,406 27,393

Development of Group Equity

Shareholders' equity Minority interests Total equity
1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009
€million €million €million €million €million €million
As at 1.1. 1,333 1,265 232 194 1,565 1,459
Changes in consolidation sccope 0 0 –9 –2 –9 –2
Dividends 0 0 0 0 0 0
Own shares 0 0 0 0 0 0
Income and expenses according to the
statement of income 131 –98 15 –11 146 –110
As at 31.3. 1,464 1,166 239 181 1,702 1,347

Consolidated Income Statement

1–3/2010 1–3/2009
€million €million
Gross premiums written 1,593 1,475
Premiums earned (net) 1,330 1,213
Income from fees and commissions 5 2
Net investment income 250 146
Other income 24 20
Total income 1,609 1,381
Insurance benefits (net) –1,190 –995
Operating expenses –337 –312
Other expenses –29 –34
Amortisation of goodwill –3 –2
Total expenses –1,558 –1,341
Operating profit 50 40
Financing costs –8 –9
Profit on ordinary activities 43 31
Income taxes –16 –12
Net profit 27 19
of which consolidated profit 21 28
of which minority interests 6 –9
Earnings per share in € 0.14 0.22
Average number of shares in circulation 142,165,567 130,853,350

The diluted earnings per share are equal to the undiluted earnings per share. Calculated on the basis of the consolidated profit.

Consolidated Comprehensive Income Statement

1–3/2010 1–3/2009
€million €million
Net profit 27 19
Foreign currency translation
Gains (losses) recognised in equity 28 –46
Included in the income statement 0 0
Unrealised gains and losses on investments
Gains (losses) recognised in equity 252 –183
Gains (losses) recognised in equity – Deferred tax –34 23
Gains (losses) recognised in equity – Deferred profit participation –127 90
Included in the income statement 0 2
Included in the income statement – Deferred tax 0 –4
Included in the income statement – Deferred profit participation 0 8
Change resulting from valuation at equity
Gains (losses) recognised in equity 0 –19
Included in the income statement 0 0
Other changes1) 0 0
Income and expense recognised directly in equity 120 –129
Total recognised income and expense 146 –110
of which attributable to UNIQA Versicherungen AG shareholders 131 –98
of which attributable to minority interests 15 –11
of which changes in accordance with IAS 8 0 0

1) The other changes result primarily from currency fluctuations.

Consolidated Cash Flow Statement

1–3/2010 1–3/2009
€million €million
Net profit including minority interests
Net profit 27 19
of which interest and dividend payments 4 5
Minority interests –6 9
Change in technical provisions (net) 805 216
Change in deferred acquisition costs –26 –20
Change in amounts receivable and payable from direct insurance –108 –99
Change in other amounts receivable and payable 75 38
Change in securities at fair value through profit or loss –62 113
Realised gains/losses on the disposal of investments –196 155
Depreciation/appreciation of other investments –74 15
Change in provisions for pensions and severance payments 4 1
Change in deferred tax assets/liabilities 41 –8
Change in other balance sheet items –57 –9
Change in goodwill and intangible assets –6 13
Other non-cash income and expenses as well as accounting period adjustments 28 –65
Net cash flow from operating activities 446 379
of which cash flow from income tax –5 –8
Receipts due to disposal of consolidated companies and other business units 0 0
Payments due to acquisition of consolidated companies and other business units –4 –58
Receipts due to disposal and maturity of other investments 2,596 2,061
Payments due to acquisition of other investments –2,933 –2,310
Change in investments held on account and at risk of life insurance policyholders –239 –42
Net cash flow used in investing activities –581 –349
Change in investments on own shares 0 0
Share capital increase 0 0
Dividend payments 0 0
Receipts and payments from other financing activities 0 –6
Net cash flow used in financing activities 0 –6
Change in cash and cash equivalents –135 24
Change in cash and cash equivalents due to foreign currency translation 1 –6
Change in cash and cash equivalents due to acquisition/disposal of consolidated companies 0 0
Cash and cash equivalents at beginning of period 798 568
Cash and cash equivalents at end of period 664 586
of which cash flow from income tax –5 –8

The cash and cash equivalents correspond to item L. of the assets: Liquid funds.

Segment Balance Sheet

Classified by segment

Property and casualty
Health
31.3.2010 31.12.2009 31.3.2010 31.12.2009
€million €million €million €million
Assets
A.
Tangible assets
168 189 30 30
B.
Land and buildings held as financial investments
381 377 285 286
C.
Intangible assets
566 595 235 233
D. Shares in associated companies 124 120 0 0
E.
Investments
2,789 2,683 2,215 2,170
F.
Investments held on account and
at risk of life insurance policyholders
0 0 0 0
G. Share of reinsurance in technical provisions 296 305 2 3
H. Share of reinsurance in technical provisions for life insurance
policies where the investment risk is borne by policyholders
0 0 0 0
I.
Receivables including receivables under insurance business
837 613 209 213
J.
Receivables from income tax
30 29 1 1
K.
Deferred tax assets
82 81 –1 1
L.
Liquid funds
191 233 222 182
Total segment assets 5,463 5,227 3,198 3,118
Equity and liabilities
B.
Subordinated liabilities
335 335 0 0
C.
Technical provisions
2,877 2,659 2,669 2,622
D. Technical provisions held on account and
at risk of life insurance policyholders
0 0 0 0
E.
Financial liabilities
34 35 28 34
F.
Other provisions
595 611 20 20
G. Payables and other liabilities 995 1,030 48 69
H. Liabilities form income tax 42 43 4 2
I.
Deferred tax liabilities
212 198 81 73
Total segment liabilities 5,090 4,911 2,851 2,822
Life
Consolidation
Group
31.3.2010
€million
31.12.2009
€million
31.3.2010
€million
31.12.2009
€million
31.3.2010
€million
31.12.2009
€million
190 143 0 0 388 363
732 771 0 0 1,398 1,433
745 688 0 0 1,546 1,516
579 597 0 0 703 717
12,957 12,294 –364 –361 17,597 16,787
3,713 3,474 0 0 3,713 3,474
450 458 0 0 748 766
386 382 0 0 386 382
793 902 –710 –709 1,130 1,020
9 10 0 0 40 40
13 15 0 0 94 96
251 383 0 0 664 798
20,818 20,117 –1,073 –1,069 28,406 27,393
270 270 –30 –30 575 575
14,231 13,918 0 1 19,776 19,200
3,630 3,416 0 0 3,630 3,416
221 219 –202 –206 81 82
34 28 0 0 649 659
1,382 1,265 –837 –830 1,588 1,534
6 4 0 0 53 49
58 41 0 0 351 312
19,833 19,160 –1,070 –1,065 26,703 25,828
Shareholders' equity and minority interests 1,702 1,565
Total equity and liabilities 28,406 27,393

The amounts indicated have been adjusted to eliminate amounts resulting from segment-internal transactions. Therefore, the balance of segment assets and segment liabilities does not allow conclusions to be drawn with regard to the equity allocated to the respective segment.

Segment Income Statement

Classified by segment

Property and casualty Health Life Consolidation Group
1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009
€million €million €million €million €million €million €million €million €million €million
Gross premiums written 836 803 260 245 498 434 –1 –7 1,593 1,475
Premiums earned (retained) 604 575 249 227 478 413 –2 –2 1,330 1,213
Income from fees and
commissions 3 3 0 0 2 –2 0 0 5 2
Net investment income 21 30 33 22 196 95 0 0 250 146
Other income 23 19 2 1 4 4 –5 –4 24 20
Insurance benefits (net) –429 –377 –222 –198 –541 –420 2 0 –1,190 –995
Operating expenses –211 –196 –37 –30 –89 –86 0 0 –337 –312
Other expenses –19 –23 –1 –1 –13 –14 5 5 –29 –34
Amortisation of goodwill –1 0 0 0 –2 –2 0 0 –3 –2
Operating profit –9 31 22 22 36 –12 1 –1 50 40
Financing costs –4 –6 0 0 –3 –3 0 0 –8 –9
Profit on ordinary activities –13 25 22 22 33 –15 1 –1 43 31
Income taxes 2 –9 –6 –5 –12 3 0 0 –16 –12
Net profit –11 16 16 17 21 –13 1 –1 27 19
of which consolidated profit –12 22 11 14 21 –7 1 –1 21 28
of which minority interests 1 –6 4 3 0 –6 0 0 6 –9

Group Notes

Accounting regulations

As a publicly listed company, UNIQA Versicherungen AG is obligated to prepare its consolidated financial statements according to internationally accepted accounting principles. These consolidated interim financial statements for the period ending 31 March 2010, have been prepared in accordance with the International Financial Reporting Standards (IFRS) and the International Accounting Standards (IAS), in the versions applicable to this reporting period. The accounting and valuation principles and consolidation methods are the same as those applied in the preparation of the consolidated financial statements for the 2008 business year.

On 1 July 2008, securities previously available for sale were reclassified according to IAS 39/50E as other loans. Overall, fixed-interest securities with a book value of €2,130 million were reclassified. The corresponding revaluation reserve as at 30 June 2008 was € –98 million. The market value as at 31 December 2009 was €1,733 million, the current market value as at 31 March 2010 amounted to €1,595 million, which corresponded to a change in market value of €66 million in the 1st quarter of 2010. In addition, an amortisation gain of €7,492 was posted in the income statement.

For creation of these consolidated interim financial statements, according to IAS 34.41, estimates are used to a greater extent than as in the annual financial statements.

Scope of consolidation

In addition to the interim financial statement of UNIQA Versicherungen AG, the Group interim financial statements include the interim financial statements of all subsidiaries in Austria and abroad. A total of 34 affiliated companies did not form part of the scope of consolidation. They were of only minor significance, even if taken together, for the presentation of a true and fair view of the Group's assets, financial position and income. The scope of consolidation, therefore, contains – in addition to UNIQA Versicherungen AG – 47 domestic and 84 foreign subsidiaries in which UNIQA Versicherungen AG held the majority voting rights.

The scope of consolidation was extended in the reporting period by the following companies:

Date of initial Net profit Acquired shares Acquisition costs Goodwill
inclusion €million1) % €million €million
Suoreva Ltd., Limassol 1.1.2010 0.0 100.0 6.4 0.0

1) Net profit for the period included in the consolidated statements.

Foreign currency translation

The reporting currency of UNIQA Versicherungen AG is the euro. All financial statements of foreign subsidiaries which are not reported in euros are converted, at the rate on the balance sheet closing date, according to the following guidelines:

  • Assets, liabilities and transition of the net profit/deficit for the period at the middle rate on the balance sheet closing date
  • Income statement at the average exchange rate for the period
  • Equity capital (except for net profit/deficit for the period) at the historic exchange rate

Resulting exchange rate differences are set off against the shareholders' equity without affecting income.

The most important exchange rates are summarised in the following table:

Euro rates on balance sheet closing date 31.3.2010 31.12.2009
Swiss franc CHF 1.4276 1.4836
Czech koruna CZK 25.4400 26.4730
Hungarian forint HUF 265.7500 270.4200
Croatian kuna HRK 7.2638 7.3000
Polish złoty PLN 3.8673 4.1045
Bosnia and Herzegovina convertible mark BAM 1.9564 1.9533
Romanian leu (new) RON 4.0970 4.2360
Bulgarian lev (new) BGN 1.9558 1.9558
Ukrainian hrywnja UAH 10.7035 11.5281
Serbian dinar RSD 99.8700 96.2300
Russian ruble RUB 39.6950 43.1540
Albanian Lek ALL 139.4393 137.6894
Macedonian denar MKD 61.2616 61.0103

Notes to the consolidated income statement

Net investment income

By segment Property and casualty
Health
Life Group
1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009
€million €million €million €million €million €million €million €million
I.
Properties held as investments
1 1 2 2 5 4 8 7
II.
Shares in associated companies
0 2 0 0 –15 5 –15 7
III. Variable-yield securities 8 –6 3 –1 45 –19 56 –26
1. Available for sale 5 –5 1 –1 8 –33 14 –40
2. At fair value through profit and loss 3 0 2 0 37 14 42 14
IV. Fixed interest securities 16 24 36 21 194 106 245 151
1. Held to maturity 0 0 1 1 4 6 5 7
2. Available for sale 15 23 34 20 180 101 230 144
3. At fair value through profit and loss 0 0 1 0 9 –1 10 –1
V.
Loans and other investments
4 14 3 9 21 38 28 61
1. Loans 1 5 2 6 11 24 15 35
2. Other investments 2 9 1 2 10 15 13 26
VI. Derivative financial instruments (held for trading) –6 –3 –10 –7 –51 –40 –67 –50
VII. Expenditure for asset management, interest
charges and other expenses –3 –2 –1 –1 –2 –2 –5 –4
Total (fully consolidated values) 20 31 33 22 197 94 250 146
By segment and income type Property and casualty Health Life Group
1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009 1–3/2010 1–3/2009
€million €million €million €million €million €million €million €million
Ordinary income 23 32 22 19 106 129 152 180
Write-ups and unrealised capital gains 12 11 14 15 108 89 134 115
Realised capital gains 18 6 18 3 97 52 134 61
Write-offs and unrealised capital losses –11 –16 –2 –12 –27 –115 –40 –143
Realised capital losses –22 –3 –20 –3 –88 –61 –130 –67
Total (fully consolidated values) 20 30 33 22 197 94 250 146

The net investment income of €250 million included realised and unrealised gains and losses amounting to €98 million, which included currency gains of € 24 million. In addition, positive currency effects amounting to €19 million were recorded directly under equity. The effects mainly resulted from investments in US dollars and pounds sterling.

Other disclosures

Employees

Average number of employees 1–3/2010 1–3/2009
Total 15,120 13,699
of which business development 6,275 6,236
of which administration 8,845 7,463

Review

These consolidated quarterly financial statements were neither audited nor reviewed by an auditor.

Imprint

Owner and publisher

UNIQA Versicherungen AG Untere Donaustrasse 21 (UNIQA Tower) 1029 Vienna Austria Commercial registry no.: 92933t Data processing register: 0055506

Investor relations

UNIQA Versicherungen AG Stefan Glinz Untere Donaustrasse 21 1029 Vienna Austria Tel.: (+43) 1 211 75 3773 Fax: (+43) 1 211 75 793773 E-mail: [email protected]

www.uniqagroup.com

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