Mandatum Oyj — Earnings Release 2023

Feb 13, 2024

Mandatum plc's financial statement release 1 January-31 December 2023: Significant increase in profit before taxes for the IPO year 2023

Mandatum plc's financial statement release 1 January-31 December 2023: Significant increase in profit before taxes for the IPO year 2023

Mandatum plc, Stock exchange release, 13 February 2024 at 10:45 EET

October-December 2023 in brief

· Profit before taxes was EUR 46.3 million (10-12/2022: 62.6). The decrease
was due to a weaker net finance result weighed down by higher finance costs on
with-profit insurance contract liabilities as a result of the decrease in the
discount rate.
· The fee result was EUR 13.4 million (6.2).
· Net flow was EUR 209.9 million (199.0).
· The net finance result was EUR 24.9 million (78.1).
· The result related to risk policies was EUR 8.0 million (5.2).

January-December 2023 in brief

· Profit before taxes increased to EUR 210.4 million (1-12/2022: 75.7). The
result improved on the comparative period in all areas, with a particularly
strong increase in the net finance result.
· The fee result was EUR 52.6 million (43.3).
· Net flow was EUR 753.8 million (499.0). Client assets under management
increased by 15% during the calendar year, to EUR 11.9 billion (31 Dec 2022:
10.3).
· The net finance result was EUR 148.6 million (50.5).
· The result related to risk policies was EUR 17.9 million (9.2).
· The Solvency II ratio was 221.4% (30 Sep 2023: 236.6%).

Dividend proposal

The Mandatum Board of Directors proposes to pay a dividend of EUR 0.33 per share
for 2023. Mandatum's Annual General Meeting will decide on the dividend
distribution on 15 May 2024. Contrary to what was previously announced, the
Board of Directors proposes 24 May 2024 as the dividend payment date.

Outlook for 2024

· The fee result is expected to increase from year 2023 provided that the
market environment remains stable. While Mandatum has been able to maintain
disciplined pricing and stable fee margins within capital-light customer
segments during years 2022 and 2023, the fee result for year 2024 is dependent
on several factors, such as client behaviour and client asset allocation,
competition and capital market conditions.

· The with-profit portfolio is expected to decrease further. Value changes of
the investments in the with-profit portfolio can create relatively high
volatility in the net finance result due to changes in the market environment.
· In addition, and as typical for the industry, the overall results of
Mandatum will be impacted by actuarial assumptions that are updated from time to
time.
· The strong solvency gives the company a sound basis to operate in different
market conditions.

Key Figures

EUR million 10-12/ 10-12/ Change 1-12/2023 1-12/2022 Change %
2023 2022 %
Profit before taxes 46.3 62.6 -26% 210.4 75.7 178%
for the period¹
Fee result 13.4 6.2 117% 52.6 43.3 22%
Net finance result 24.9 78.1 -68% 148.6 50.5 194%
Result related to 8.0 5.2 53% 17.9 9.2 96%
risk policies
Other income2 0.0 -26.9 -100% -8.7 -27.1 -68%
Earnings per share, 0.06 0.093 -38% 0.32 0.123 182%
EUR³
Equity per share, 3.19 3.373 -4%
EUR³
Price/earnings ratio 12.71 n/a n/a
(P/E ratio)
Net flow 209.9 199.0 5% 753.8 499.0 51%
Return on equity-% 9.8% 3.3% 6.4%
Cost/income ratio 65.5% 67.0% -1.5%
related to client
AuM, %

EUR million 31 Dec 2023 31 Dec 2022 Change %
Client AuM 11,892 10,302 15%
Solvency ratio, % 221.4% 265.5% -45%

(Due to the implementation of IFRS 17, key figures are presented for two years
as applicable)

1)        For the comparative period, comprehensive income items were included.

2)        The impact of the group contribution of EUR -29.0 million was
recognized in profit or loss.

3)        The number of shares used in the calculation corresponds to the number
of shares after the partial demerger of Sampo Group on 2 Oct 2023: 501,796,752.

CEO comment

Mandatum's result for the financial year 2023 was excellent. The result before
taxes was EUR 210.4 million (75.7), a significant increase from the comparative
period. All result areas supported the growth.

A favourable trend in the capital-light business, which is at the core of
Mandatum's strategy, translated into growth in both the net flow and the fee
result. Net flow in the year under review totalled EUR 753.8 million, more than
7% of the client assets under management, and well exceeded our midterm goal of
5%. Assets under management increased by 15% to EUR 11.9 billion during the
year, which is evidence of Mandatum's performance and resilience even in a
challenging market environment. Both the net flow and the assets under
management increased to a record high level.

Sales activity remained at a high level throughout the year, with 75% of new
sales in wealth management coming through our corporate business. This is proof
of the effectiveness of our strategy, our strong position in the corporate
segment and close co-operation between our business areas. Sales were also
supported by our fixed income-focused product offering well suited to the
current market environment. A good example of this is the gross return of over
13% on the UI-Mandatum AM Senior Secured Loan fund classified as Article 9 of
the EU Sustainable Finance Disclosure Regulation. The expansion of wealth
management business to Sweden and Denmark proceeded as planned during the year.

The net finance result increased significantly and return on investments clearly
exceeded the finance expense on insurance contract liabilities. However, it is
worth noting that value changes of the with-profit portfolio investments
according to movements in the market environment and interest rates are
typically reflected in relatively large volatility especially in the net finance
result across the quarters. This comes with the territory in the life insurance
business.

Mandatum at the forefront of Finnish asset managers

Mandatum was ranked the second-best institutional asset manager in Finland in
November in the category of large companies in a customer study conducted by
Scandinavia Financial Services Research where approximately 100 Finnish
institutional investors rated Finnish service providers. This achievement is
proof of our long-term engagement for growth in institutional asset management.
Our Net Promoter Score (NPS), which measures customer satisfaction across all
our encounters with our customers, also continued on a strong track and was
measured at 76.8 - a score with which we can be very pleased.

Mandatum's Board of Directors proposes a dividend of EUR 0.33 per share for the
financial year 2023. The company is still at the beginning of its journey as a
listed company, and the proposed dividend is in line with the previously
communicated target. Mandatum aims to distribute a cumulative dividend of EUR
500 million during the years 2024 to 2026. It is important for us to be a good
dividend payer also in the future.

The year 2023 was historical for Mandatum as well as for myself as the CEO of
the company. Mandatum was separated from the Sampo Group through partial
demerger, and trading with the MANTA share began on 2 Oct 2023. The listing
supports our growth strategy and signifies that Mandatum has become
strategically and financially independent. At the same time, it was a
significant addition for the entire financial sector on the stock exchange and a
boost in a year otherwise low on listings. Our ownership structure changed
during the first weeks of trading, for example when investors solely focused on
non-life insurance divested their holdings. On the other hand, the interest
shown in the company by new institutional investors and particularly by private
investors made Mandatum the third largest company on the Helsinki Stock Exchange
by number of shareholders. For this, I am pleased and grateful. It is great that
investors see our potential to create shareholder value.

I would like to thank our customers, shareholders and employees along with all
other Mandatum stakeholders for the past year. We have laid excellent groundwork
for continuing our new journey on the stock exchange.

Petri Niemisvirta
Chief Executive Officer

Conference call on 13 February at 1.00 p.m. EET, Finnish time

A conference call in English for analysts and investors is scheduled for 13
February 2024 at 1.00 p.m. EET, Finnish time. You can register for the
conference call using the link provided below. The phone numbers for the
conference call and the associated code will be provided upon registration.

Registration for the event: https://palvelu.flik.fi/teleconference/?id=10012279

The conference call can be followed live on the internet at
www.mandatum.fi/en/result. A recording of the call will be made available for
later access at the same web address.

Additional information

Investor enquiries:
Jukka Kurki

CFO

Tel. +358 50 424 6630

Lotta Borgström
VP, Investor Relations
Tel. +358 50022 1027
lotta.borgstrom[a]mandatum.fi

Media enquiries:
Niina Riihelä
SVP, Communications, Brand and Sustainability
Tel. +358 40728 1548
niina.riihela[a]mandatum.fi

The financial statement release can be found as an attachment to this stock
exchange release. The supplementary presentation material for investors
accompanying the Mandatum interim report is available at
www.mandatum.fi/en/result.

Mandatum plc will publish its Q1 Interim Report on 8 May 2024, Half-year
Financial Report on 13 Aug 2024 and Q3 Interim Report on 12 Nov 2024.

Mandatum in brief
Mandatum is a major financial services provider that combines expertise in
wealth management and life insurance. Mandatum offers customers a wide array of
services covering asset and wealth management, savings and investment,
compensation and rewards, pension plans and personal risk insurance. Mandatum
offers services to corporate customers, retail customers as well as
institutional and wealth management customers. At the center of Mandatum's
success are highly skilled personnel, strong brand, and investment track record.
mandatum.fi/en/group

Distribution:
Nasdaq Helsinki
Financial Supervisory Authority
The principal media
www.mandatum.fi/en

Attachments: