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Tryg A/S – Q1-Q3 report 2020

Tryg A/S
·4-min read

Tryg’s Supervisory Board has today approved the interim report for Q1-Q3 2020.

During the first nine months of 2020, Tryg reported premium growth of 6.9%, driven primarily by a strong positive momentum in the Private segment. The technical result of DKK 2,715m (DKK 2,475m) was driven by satisfactory top-line growth, a continued positive development in the core business and delivery of the Alka synergies. The outbreak of COVID-19 had a net impact of DKK -113m, including investment losses. The investment income was DKK 202m (DKK 381m) and was positively impacted by a continued market rebound after steep losses in Q1. A profit before tax of DKK 2,318m (DKK 2,688m) was reported. Tryg’s solvency ratio ended at 214, positively impacted by the result for the period and by the decision announced on 27 March 2020 to move to a full-year dividend decision for 2020.

Financial highlights Q3 2020
• Premium growth of 4.9% (6.8% excluding Alka in Q3 2019) in local currencies
• Technical result of DKK 980m (DKK 870m) driven by continued positive development in core business and Alka synergies
• Combined ratio of 82.7 (84.4)
• Underlying claims ratio (Private and Group) improved by 0.2 and 0.6 percentage points
• Expense ratio of 14.1 (13.9)
• Return on free investments portfolio DKK 266m (DKK 97m)
• Total investment return of DKK 237m (DKK -29m)
• Profit before tax of DKK 1,150m (DKK 779m)
• Solvency ratio of 214

Financial highlights Q1-Q3 2020
• Premium growth of 6.9% (6.3% excluding Alka in Q1-Q3 2019) in local currencies
• Technical result of DKK 2,715m (DKK 2,475m)
• Combined ratio of 83.9 (84.8)
• Expense ratio of 14.2 (14.0)
• Return on free investments portfolio of DKK 72m (DKK 631m)
• Total investment return DKK -202m (DKK 381m)
• Profit before tax of DKK 2,318m (DKK 2,688m)

Customer highlights Q3 2020
• Transactional Net Promotor Score (TNPS) at an all-time high level of 71 (67)
• Number of products per customer increased to 3.9 (3.8)
• For the fifth year running, TryghedsGruppen paid out a member bonus of 8% to its members on 29 September based on dividend from Tryg also supporting TryghedsGruppen’s spend of DKK 650m on charity and prevention related activities via TrygFonden
• In Q3, awareness of TryghedsGruppen’s member bonus was unchanged for non-customers with 29% - the payment date of the bonus was later than previous year period, and Tryg therefore expects to see a positive awareness of this in Q4 instead of Q3

Statement by Group CEO Morten Hübbe:
2020 has been a highly unusual year characterised by the outbreak of COVID-19 that has strongly impacted our business. In Q1, Tryg reported negative investment result of almost DKK 1bn, which have impacted our results, but we are pleased to see that we have recovered around 80% of the losses. In Q1-Q3 2020, Tryg have helped more than 160,000 customers across the Nordic region with travel claims - a 50% increase compared to prior-year period. In 2020, we have noticed a drop in the number of claims in other lines of business for short periods of time driven by the lockdown in societies. The number of claims is now almost back to normal levels, and for the period Q1-Q3 2020, COVID-19 resulted in total costs of DKK -113m.

At the same time, Tryg continue to deliver a satisfactory growth of 4.9 % for the Group with a positive delivery from all the business areas. Especially, Commercial Denmark has reversed a downward spiral to a continual positive premium and customer growth the last two years with solid profitability.

We notice that Danes are buying health related products like never before, which have resulted in a 75% growth in the last three years, and therefore the area with the highest growth rate in Tryg. 175,000 Danes have bought child insurance, more than 50,000 have bought dental insurance, and every month, more than 7,000 people buy a personal insurance in Tryg.

Finally, I am very pleased that for the fifth consecutive year, TryghedsGruppen, Tryg’s majority shareholder, paid out member bonus of almost a billion to Tryg and Alka customers. This is equivalent to every fourth Dane.

Conference call
Tryg hosts a conference call today at 10:00 CEST. CEO Morten Hübbe and CFO Barbara Plucnar Jensen will present the results in brief followed by Q&As.

The conference call will be held in English. An on-demand version will be available shortly after the conference call has ended.

Conference call details:
Danish participants: +45 78 15 01 10
UK participants: +44 (0) 333 300 9266
US participants: +1 833 526 8382

All Q3 material can be downloaded on shortly after the time of release.