Pozavarovalnica Sava

Earnings Release • Mar 6, 2023

Sava Insurance Group

unaudited results

March 2023

Highlights of 2022

Growth of 6.1% in GPW – mostly in motor insurance due to the growth in the number of policies sold and the average premium; premiums also grew in the reinsurance segment due to positive price movements in global reinsurance markets and in the international life segment, mainly due to the new bank sales channel

Net profit of €68.2 million (2021: €76.2 million); -10.4% compared to 2021, 13.7% above target

• Negative impact on claims: increase in claims paid and claims provisions due to claims inflation, storms and the rise in motor claims frequency in Slovenia following the easing of Covid-19 measures
• Positive impact on underwriting result: improvement in FoS business result, results of subsidiaries outside Slovenia and reinsurance
• Impact on investment result: unfavourable developments in the financial markets affected the result of the Slovenian pension company and the investment result due to fair value changes of FVTPL assets

Standard & Poor's and AM Best's "A" ratings, stable outlook, affirmed

23 June 2022: dividend of €1.50 per share approved, representing a dividend yield of 5.9%

December 2022: new five-year strategy of the Sava Insurance Group published

Achievement of the 2022 plan

	2021 actual	2022 plan	2022 actual
Group
Operating revenue	€732.7 m	> €700 m	€753.6 m
Profit, net of tax	€76.2 m	> €60 m	€68.2 m
Return on equity (ROE)	15.8%	>= 11.5%	14.9%
Net expense ratio*	29.0%	31‒32%	29.3%
Investment return*	1.8%	1.4%	1.3%
Net combined ratio* (reins. + non-life)	88.1%	< 94%	90.7%

* Impact of exchange rate differences excluded. The investment return does not include subordinated debt expenses. The net expense ratio does not include amortisation of contractual relationships with clients.

2022 financial position

€ million	31/12/2021	31/12/2022	Growth/decline 2022/2021
Group
Total assets	2,658.3	2,534.0	-4.7%
Shareholders' equity	504.1	412.0	-18.3%
Net technical provisions	1,703.9	1,683.7	-1.2%
Book value per share (€)	32.53	26.58	-18.3%

The decrease in the above items is mainly due to the adverse developments in the financial markets. The rise in interest rates had a significant impact on the decrease in investments and on the negative fair value reserve within equity, while the falls in equity markets had the greatest impact on investments and technical provisions for policyholders who bear the investment risk (excluding these provisions, net technical provisions increased by 0.4%).

Development of consolidated GPW

Development of consolidated GPW and inflows by market

Insurance, pension and asset management companies Reinsurance company

* 1–9/2022 as data for the full year 2022 have not yet been published.

** 1–12/2021 as more recent data not available.

6

MS = market share

Structure of the investment portfolio

	Amount		Structure
million €	31/12/2021	31/12/2022	31/12/2021	31/12/2022
bonds Government	718 5	732 6	4% 45	6% 51
bonds Corporate	592 1	417 8	4% 37	4% 29
Cash and cash equivalents	74 0	78 4	7% 4	5% 5
Infrastructure funds	44 5	53 9	2 8%	3 8%
Shares	36 0	23 1	2 3%	1 6%
Investment property	14 3	22 8	0 9%	1 6%
Mutual funds	35 9	22 2	2 3%	1 6%
Deposits & CDs	18 6	19 3	2% 1	4% 1
Real funds estate	8 15	16 5	0% 1	2% 1
Other	31 8	33 6	0% 2	4% 2
Total investment portfolio	1 581 4 ,	1 420 0 ,	100 0%	100 0%

Investment grade assets accounted for 86.5% of fixed rate investments.

Thank you for your attention.