Tryg’s Supervisory Board has today approved the interim report for Q1 2023*.
Tryg is reporting for the first time under the new accounting standard, IFRS 17, in line with the insurance sector. Tryg has published comprehensive re-stated figures under IFRS 17 at the end of March, these are available on Tryg.com. The insurance service result target for 2024 under IFRS 17 has been increased from DKK 7.0-7.4bn to DKK 7.2-7.6bn driven primarily by a reclassification of insurance operating expenses. Tryg is also updating its expense ratio target to ~13.5% (~14.0%) while the combined ratio target at or below 82% is unchanged. Tryg reported a Q1 insurance service result of DKK 1,474m (DKK 1,014m), driven by a positive top-line development, across all business units, good development in the core business including the delivery of the RSA Scandinavia synergies and a higher level of interest rates which reduces claims costs (all else being equal). Lower weather and large claims compared to Q1 2022 also helped the financial performance. The underlying claims ratio for the Group improved by 0.7 percentage points, while it showed a modestly negative development for the Private segment. The combined ratio was 84.0 (88.9). The investment return for the quarter was DKK 167m, primarily driven by positive returns on equities and fixed income asset classes. The pre-tax result was DKK 1,187m. A solvency ratio of 200 was reported at the end of the quarter. Tryg reports a Q1 Operating EPS of 1.70 and pays a Q1 DPS of 1.85.
* All comparative figures are restated to IFRS 17 including the pro-forma figures for Q1 2022. The comparison figures for Q1 2022 are pro-forma disclosed at the end of March and published on Tryg.com
Financial highlights Q1 2023
Insurance revenue growth (Premium growth) of 4.6% (5.9%) in local currencies
Insurance service result (Technical result) of DKK 1,474m (DKK 1,014m)
Combined ratio of 84.0 (88.9)
Underlying claims ratio (Group) improved by 0.7
Expense ratio of 13.3 (13.7)
Total investment return of DKK 167m
RSA related synergies of DKK 64m
Profit before tax of DKK 1,187m
Quarterly dividend of DKK 1,211m or DKK 1.85 per share and solvency ratio of 200
Customer highlights Q1 2023
Customer satisfaction score of 86 (85 in Q1 2022)
For the eighth year in a row, TryghedsGruppen decided to pay member bonus. For 2022, this amounts to 6% of premiums to be paid during the autumn of 2023
Statement by Group CEO Morten Hübbe:
We have had a good start to 2023 with solid financial results and increasing customer satisfaction. It creates a positive foundation for Tryg’s further progress this year and beyond.
I am pleased to see an insurance service result of DKK 1,474m and a combined ratio of 84.0 in a normally challenging quarter due to seasonal weather variances This is driven by a good top-line growth, the delivery of RSA synergies and progresses in the underlying claims development. It is clearly positive to see a strong business momentum, despite difficult macroeconomic conditions, in combination with realised synergies from the acquisition of Trygg-Hansa and Codan Norway.
We are pleased to announce a quarterly dividend per share of DKK 1.85 – an increase of almost 20% from Q1 2022 driven by the full inclusion of Codan Norway and Trygg-Hansa, synergies delivery and improvements in the underlying business. The quarterly DPS of 1.85 is higher than the quarterly run-rate of the dividend in 2020 which was the last year before the acquisition of RSA Scandinavia that was funded by a rights issue of DKK 37bn resulting in more than doubling the number of shares.
We are very pleased to see that TryghedsGruppen has announced a 2023-member bonus of DKK 950m, which is equivalent to 6% of premiums paid in 2022. It is the eighth year in a row that TryghedsGruppen has decided to pay out a member bonus to customers in Denmark and should be seen in connection with Tryg’s dividend.
My tenure as Group CEO is soon coming to an end, and I feel immensely proud to hand over the baton to Johan Kirstein Brammer and his strong Executive Board as on 1 June 2023. This is a group of accomplished leaders that represents years of value creation and continuity – I cannot think of a better team to shape Tryg’s future.
Tryg hosts a conference call today at 10:00 CET. CEO Morten Hübbe, CFO Barbara Plucnar Jensen, CCO Johan Kirstein Brammer and CTO Mikael Kärrsten 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:
DK: +45 78 76 84 90
UK: +44 203 769 6819
US: +1 646 787 0157
All Q1 material can be downloaded on tryg.com/en shortly after the time of release.