CNP Assurances: H1 2010 Revenue and Results
Premium Income up 2.4% Recurring Profit up 3.9%, Net Profit up 8.0%
PARIS, July 30, 2010 /PRNewswire-FirstCall/ -- CNP Assurances, the leading personal insurer in France with operations in the rest of Europe and in South America, has announced its premium income and results for the first six months of 2010.
First-Half 2010 Highlights
- Premium income up 2.4% to EUR17.7 billion, led by 19.3%
growth in international revenues.
- Ongoing recovery in unit-linked business to 10.9% of
revenues in France and 16.5% of total Group revenues.
- Average technical reserves up by a strong 9.2%.
- Net insurance revenue up 10.3%.
- Recurring profit before fair value adjustments up 3.9%
- Reported net profit up 8.0% to EUR542 million. <end_tale>
Gilles Benoist, Chief Executive Officer, said:
"As announced at the beginning of the year, we have been focusing on profitability. Sales of personal risk insurance and unit-linked products increased significantly during the first half. Revenue growth was satisfactory, particularly in Brazil. In all, the increase in profit attests to the robustness of our business model."
1. First-Half 2010 Business Review[1]
In the first half of 2010, premium income rose 2.4% to EUR17.7 billion.
Savings premiums contracted by a slight 1% compared with first-half 2009 which saw nearly 30% growth as a result of promotional campaigns featuring no-front-end-load products. The robust first-half 2010 savings performance - with premiums at EUR13.4 billion - was accompanied by a strong recovery in front-end loads in line with the profitable growth strategy announced at the beginning of the year.
Pension, personal risk and loan insurance premiums rose sharply versus the year-earlier period. Part of the increase was attributable to favourable exchange rates, led by the 22% gain in the Brazilian real compared with first-half 2009. The consolidation of CNP-Barclays Vida y Pensiones (CNP-BVP) also contributed to premium growth. Based on a comparable scope of consolidation and at constant exchange rates, pension revenues were up 3.8%, personal risk premiums were 11.9% higher and loan insurance premiums advanced 8.2%.
IFRS French GAAP
Premium income H1 2010 % change H1 2010 % change
(EURm)
Savings 13,415.9 - 1.0 13,914.0 +1.5
Pensions 1,534.5 +21.0 1,748.4 +13.0
Personal risk 878.7 +18.0 878.7 +18.0
Loan insurance 1,454.4 +12.4 1,454.4 +12.4
Health insurance 253.0 +8.2 253.0 +8.2
Property & Casualty 160.0 -18.4 160.0 -18.4
TOTAL 17,696.5 +2.4 18,408.6 +3.9
The rebound in unit-linked sales observed in first-quarter 2010 continued in the second quarter, lifting their contribution to premium income to 10.9% in France and 16.5% for the Group as a whole. In all, unit-linked sales more than doubled compared with first-half 2010, rising by 130.0% overall and by 311.7% in France.
Average and period-end technical reserves expanded by 9.2%, reflecting consistently positive net new money.
- France
In France, premium income contracted by a slight 1.2% to EUR14.1 billion. (On a French GAAP basis, the decline was 1.7%, to EUR14.3 billion). Business volumes improved in the second quarter, with premium income rising 3.8% after contracting 5.3% in the first quarter. The French life market grew 8% in first-half 2010 to EUR78.5 billion (source: FFSA).
Net new money in France remained strongly positive, at EUR4.9 billion for the period. The claims/technical reserves ratio improved slightly, to 7.5% at 30 June 2010 from 7.8% a year earlier.[2]
i. La Banque Postale
Premium income generated by La Banque Postale declined by 8.3% to EUR5.4 billion in first-half 2010, reflecting the very high basis of comparison in the year-earlier period when revenues were boosted by marketing campaigns organised by the network at the beginning of the year.
The first six months of 2010 saw the development of regular premium products and also confirmed the rebound in unit-linked sales observed in late 2009.
The Pensions business continued to grow rapidly, with premium income up 27.9%, along with the Personal Risk business, where the 16.8% growth in premiums was led by a 14.3% increase in loan insurance premiums.
ii. Savings Banks
The Savings Banks generated premium income of EUR6.2 billion in first-half 2010, an increase of 5.6% over the year-earlier period that was primarily attributable to the success of products targeting the network's private banking customers.
Special rates offered to savers who split their investment between traditional and unit-linked funds and the three tranches of BPCE bonds packaged in unit-linked bond funds helped to drive a more than 500% increase in unit-linked sales, lifting their contribution to total savings/pensions revenue to 17%.
Personal risk premiums were 28.6% higher, reflecting growth in loan insurance business.
iii. CNP Tresor
CNP Tresor generated premium income of EUR346.5 million in first-half 2010. The 1.6% decline compared with the year-earlier period was due to lower average premiums. Premiums from new business were significantly higher, however. Unit-linked sales accounted for 5.1% of total savings/pensions revenue generated in first-half 2010.
iv. Financial Institutions
Loan insurance premiums recorded by the Financial Institutions partnership centre rose 3.5% in first-half 2010. The Group bid for several contracts during the period and signed a new credit insurance partnership. Although the property market picked up in the first quarter, the outlook for the second half of the year is uncertain due to the fragile economic environment, the upward trend in house prices and the scaling back of government incentives (such as cancellation of the 100% increase in the ceiling for interest-free loans on new properties, restrictions on buy-to-let tax incentives).
v. Companies & Local Authorities
In Personal Risk insurance, several large employee benefits contracts won in 2009 came into effect on 1 January 2010, leading to an increase in premium income from the Companies segment.
Group pensions revenue declined compared with first-half 2009 which represented a high basis of comparison due to a change in the law requiring companies that had their own supplementary pension institution (IRS) to transfer their commitments to an insurance company. CNP Assurances won several of these contracts, leading to a sharp increase in premium income for the period. First-half 2010 nevertheless saw the signature of several major contracts, helping to keep premiums at a satisfactory EUR334 million.
- International Operations
Premium income from operations outside France rose 19.3% to EUR3.6 billion in first-half 2010. (Premiums under French GAAP were 29.4% higher at EUR4.1 billion[3]). This robust performance was mainly attributable to 14.1% premium growth in Brazil, the second-half 2009 launch of the partnership with Barclays (CNP-BVP) and the favourable currency effect in Brazil.
The real strengthened against the euro throughout 2009 and the first half of 2010, with the average exchange rate falling from BRL 3.05 in first-half 2009 to EUR2.39 in the same period of 2010, driving a 21.6% increase in Caixa Seguros's contribution to consolidated premium income.
Based on a comparable scope of consolidation and at constant exchange rates, premium income from international operations was up by a healthy 8.9% (15% under French GAAP).
i. CNP Unicredit Vita
CNP UniCredit Vita reported premium income up 4.7% at EUR1.9 billion. Traditional savings products continued to account for the bulk of the total, particularly the Unigarantito product which represented 69% of sales. A gradual shift in mix is nevertheless taking place in favour of unit-linked products, led by Uniplan (a regular premium unit-linked product), UniOpportunita (a single premium traditional savings product with a unit-linked formula) and UniValore (a single premium unit-linked contract).
CNP UniCredit Vita Premium Income
EURm IFRS French GAAP
MARKET SEGMENT H1 2010 % change H1 2010 % change
Savings 1,825.0 +4.4 2,033.1 +14.7
Pensions 9.3 -7.6 9.3 -7.6
Personal risk 3.3 -20.6 3.3 -20.6
Loan insurance 34.2 +30.4 34.2 +30.4
TOTAL 1,871.9 +4.7 2,080.0 +14.7
ii. Caixa Seguros
Caixa Seguros enjoyed very strong growth during first-half 2010 and its contribution to consolidated premium income was also boosted by the very favourable currency effect.
Premium income rose 14.1% in local currency and 45.6% after conversion into euros.
All business lines contributed to the increase. Pensions business grew by a strong 11.7%, while government measures to promote home ownership helped to drive a 22.2% surge in loan insurance premiums.
Caixa Seguros Premium Income
BRLm IFRS French GAAP
MARKET SEGMENT H1 2010 % change H1 2010 % change
Savings 77.2 + 23.6 501.8 + 14.8
Pensions 1,800.7 + 11.7 1,800.7 + 11.7
Personal risk 445.0 + 27.6 445.0 + 27.6
Loan insurance 251.0 + 22.2 251.0 + 22.2
Property & Casualty 303.5 + 3.9 303.5 + 3.9
TOTAL 2,877.5 + 14.1 3,302.0 + 14.0
iii. CNP- Marfin Insurance Holding
CNP-MIH reported premium income of just under EUR100 million in first-half 2010, up 10.8% over the year-earlier period. Operations in Cyprus contributed 92% of the total, and operations in Greece 8%. The main businesses are savings (EUR38 million) and property & casualty insurance (EUR33 million).
iv. CNP Barclays Vida y Pensiones
CNP-BVP contributed premium income of EUR155 million, mainly from operations in Spain (EUR109 million) but also in Portugal (EUR23 million) and Italy (EUR23 million).
2. 2010 Interim Results
Net insurance revenue for first-half 2010 amounted to EUR1,412 million, up 10.3% on the year-earlier period. Growth was led by the 9.7% increase in insurance revenues and the sharp 11.7% rise in revenues from own-funds portfolios.
Administrative expenses rose by 6.8%, including a 24.4% increase outside France (15.2% based on a comparable scope of consolidation and at constant exchange rates).
EBIT was 11.9% higher at EUR981 million, of which 66%[4] from operations in France and 34%4 from international operations.
Recurring profit before fair value adjustments totalled EUR523 million in first-half 2010, an increase of 3.9% over the same period of 2009.
Net realised gains on equities and investment property and Fair value adjustments to trading securities had a EUR21 million positive impact on consolidated profit for the period versus a EUR1 million negative impact in first-half 2009. The first-half 2010 total included a EUR30 million gain realised in the first quarter on the sale of Global in Portugal. In addition, impairment provisions recognised during the period were lower than in first-half 2009.
Net profit for first-half 2010 rose by a strong 8% to EUR542
million.
Interim Income Statement
H1 2010 H1 2009 % change
EURm EURm
Premium income 17,697 17,288[5] + 2.4%
Net insurance revenue 1,412 1,280 + 10.3 %
- Expenses (431) (403) -
Gross operating profit (EBIT) 981 877 + 11.9%
- Finance costs and share (39) (31) -
of profit of associates
- Income tax expense (315) (281) -
- Minority interests (104) (61) -
Net recurring profit 523 503 + 3.9%
before capital gains
Net realised gains 38 (77) -
(losses) on equities and
investment property
Fair value adjustments to (17) 76 -
trading securities
Non-recurring items (2) - -
Attributable profit 542 502 + 8.0%
3. Embedded Value per share at 30 June 2010[6]
Market consistent embedded value (MCEV) rose by 2.5% to EUR19.4 per share at 30 June 2010.
30 June 2010 31 December 2009 % change
En EUR/action En EUR/action
Market Consistent Embedded Value 19.4 19.0 + 2.5%
Adjusted net asset value (ANAV) 15.2 14.3 + 6.3%
Value-in-force (VIF) 4.2 4.6 - 9.6%
The value of new business came to EUR196 million or EUR0.33 per share, and the new business (APE) margin was 11.3% versus 11.5% at 31 December 2009.
4. Solvency capital
CNP Assurances maintained its solid financial position, with the solvency capital requirement under Solvency I covered 1.10 times by equity and quasi-equity at 30 June 2010 - unchanged from 31 March 2010 - and 1.93 times including unrealised capital gains. No intangible assets were taken into account in the calculation.
APPENDICES
Premium Income by Partnership Centre
IFRS French GAAP
H1 2010 H1 2009 Change H1 2010 H1 2009 Change
EURm EURm % EURm EURm %
La Banque Postale 5,452.7 5,948.0 - 8.3 5,454.5 5,949.7 - 8.3
Savings Banks 6,175.8 5,848.5 + 5.6 6,177.0 5,849.6 + 5.6
CNP Tresor 346.5 352.2 - 1.6 346.5 358.7 - 3.4
Financial institutions 763.2 737.4 + 3.5 763.2 737.4 + 3.5
France (1)
Mutual Insurers 417.7 374.4 + 11.6 417.7 374.4 + 11.6
Companies & Local 854.5 903.8 - 5.4 1,068.4 1,183.1 - 9.7
Authorities
Other (France) 87.9 106.9 - 17.8 87.9 106.9 - 17.8
TOTAL France 14,098.3 14,271.3 - 1.2 14,315.2 14,559.7 - 1.7
Global (Portugal) (2) - 97.9 - 100.0 - 97.9- 100.0
CNP Seguros de Vida 6.2 3.5 + 75.8 6.2 3.5 + 75.8
(Argentina) (3)
CNP Vida (Spain) 169.1 138.2 + 22.4 169.1 138.2 + 22.4
Caixa Seguros (Brazil)
(3) 1 205.4 827.7 + 45.6 1 383.7 950.4 + 45.6
CNP UniCredit Vita 1 871.9 1 788.5 + 4.7 2 080.0 1 813.0 14.7
(Italy)
CNP Marfin Insurance 99.9 90.1 + 10.8 100.0 90.1 + 11.0
Holdings (Cyprus/
Greece)
CNP Europe (Ireland) 11.1 0.5 - 11.1 0.5 -
BVP Portugal (Portugal) 22.8 - - 131.4 - -
BVP Espana (Spain) 109.1 - - 109.1 - -
BVP Italia (Italy) 23.2 - - 23.2 - -
Financial Institutions 51.8 60.5 - 14.4 51.8 60.5 - 14.4
outside France
Branches 27.8 10.0 + 178.3 27.8 10.0+ 178.3
TOTAL International 3,598.3 3,016.9 + 19.3 4,093.4 3,164.1 + 29.4
TOTAL 17,696.5 17,288.2 + 2.4 18,408.617,723.8 + 3.9
(1) Excluding Cofidis outside France.
(2) Global was sold in March 2010 (closing date)
(3) Average exchange rates
Argentina: 1EUR = ARS 5.20321
Brazil: EUR1 = BRL 2.38712
Premium Income by Business Segment
IFRS
(EURm) H1 2010 H1 2009 % change H1 2010 % change
like-for-like like-for-like
(1)
Savings 13,415.9 13,550.6 - 1.0 13,343.4 - 1.0
Pensions 1,534.5 1,268.5 + 21.0 1,316.5 + 3.8
Personal risk 878.7 744.9 + 18.0 831.8 + 11.9
Loan insurance 1,454.4 1,294.4 + 12.4 1,400.7 + 8.2
Health insurance 253.0 233.8 + 8.2 253.0 + 8.9
Property & 160.0 196.0 - 18.4 132.2 + 4.1
Casualty
TOTAL 17,696.5 17,288.2 + 2.4 17,277.5 + 0.5
French GAAP
(EURm) H1 2010 H1 2009 % change H1 2010 % change
like-for-like like-for-like
(1)
Savings 13,914.0 13,707.0 + 1.5 13,694.0 + 0.1
Pensions 1,748.4 1,547.8 + 13.0 1,530.4 - 1.1
Personal risk 878.7 744.9 + 18.0 831.8 + 11.9
Loan insurance 1,454.4 1,294.4 + 12.4 1,400.7 + 8.2
Health insurance 253.0 233.8 + 8.2 253.0 + 8.9
Property & 160.0 196.0 - 18.4 132.2 + 4.1
Casualty
TOTAL 18,408.6 17,723.8 + 3.9 17,842.0 + 1.2
(1) Based on 30 June 2009 exchange rates.
Average exchange rates for Brazil:
First-half 2010 EUR1 = BRL 2.38712
First-half 2009 EUR1 = BRL 3.04641
Premium Income by Country
IFRS French GAAP
(EURm) H1 2010 % change H1 2010 % change
France 14,098.3 - 1.2 14,315.2 - 1.7
Italy (1) 1,918.7 + 6.5 2,126.8 + 16.5
Brazil (2) 1,205.4 + 45.6 1,383.7 + 45.6
Spain (3) 298.0 + 89.0 298.0 + 89.0
Portugal (4) 41.9 - 65.1 150.5 + 25.4
Cyprus/Greece 99.9 + 10.8 100.0 + 11.0
Other (5) 34.4 - 34.4 -
TOTAL 17,696.5 + 2.4 18,408.6 + 3.9
(1) Italian branches and Cofidis business in Italy since 2004 and CNP
UniCredit Vita.
(2) Based on 30 June 2010 exchange rates.
(3) Spanish branches, Cofidis Spain, CNP Vida and, since 1 September
2009, BVP Spain
(4) Cofidis Portugal and BVP Portugal since 1 September 2009
(5) Argentina, Ireland, Cofidis Belgium, Czech Republic, Greece and
Hungary.
Unit-Linked Sales
IFRS French GAAP
H1 2010 H1 2009 Change H1 2010 H1 2009 Change
EURm EURm % EURm EURm %
La Banque Postale 276.6 142.1 + 94.7 278.5 143.8 + 93.7
Savings Banks 999.7 148.2 + 574.8 1 000.9 149.2 + 570.8
CNP Tresor 16.8 10.3 + 63.3 16.8 16.7 + 0.5
Other 4.3 6.4 - 32.0 4.3 6.4 - 32.0
TOTAL individual 1,297.5 306.9 + 322.8 1,300.6 316.1 + 311.5
unit-linked France
Group unit-linked France 11.8 11.1 + 6.3 225.7 290.4 - 22.3
TOTAL France 1,309.4 318.1 + 311.7 1,526.3 606.5 + 151.7
CNP UniCredit Vita 213.3 123.9 + 72.2 417.2 152.7 + 173.2
Caixa Seguros 748.8 524.4 + 42.8 748.8 524.4 + 42.8
CNP Vida 106.6 73.0 + 46.1 106.6 73.0 + 46.1
CNP Marfin Insurance 35.4 33.6 + 5.1 35.5 33.6 + 5.5
Holdings
CNP Europe 11.1 0.5 - 11.1 0.5 -
BVP Portugal - - - 108.6 - -
BVP Spain 28.5 - - 28.5 - -
BVP Italy 15.9 - - 15.9 - -
TOTAL International 1,159.5 755.4 + 53.5 1,472.2 784.2 + 87.7
TOTAL UNIT-LINKED 2,468.9 1,073.5 + 130.0 2,998.5 1,390.8 + 115.6
Breakdown by Insurance Category
IFRS French GAAP
H1 2010 H1 2009 Change H1 2010 H1 2009 Change
Individual 14,831.3 14,622.1 + 1.4 15,329.4 14,778.4 + 3.7
insurance
Group insurance 2,865.3 2,666.1 + 7.5 3,079.2 2,945.4 + 4.5
TOTAL 17,696.5 17,288.2 + 2.4 18,408.6 17,723.8 + 3.9
Premium Income by Country and by Business Segment
IFRS
Savings Pensions Personal risk
EURm H1 10 % change H1 10 % change H1 10 % change
France 11,290.5 -2.6 715.3 -1.4 665.1 9.4
Italy (1) 1,847.5 5.7 9.3 -7.6 3.3 -25.7
Portugal (2) 10.3 -60.4 0.0 - 1.0 -27.0
Spain (4) 184.5 38.6 56.1 - 5.1 -
Cyprus/Greece 37.9 9.1 0.0 - 15.2 5.3
Other (Europe) (3) 11.1 - 0.0 - 0.0 -
Brazil 32.4 56.7 753.9 42.4 186.4 62.9
Argentina 1.6 28.5 0.0 - 2.7 33.0
Sub-total
International 2,125.4 8.2 819.3 50.9 213.6 56.2
TOTAL 13,415.9 -1.0 1,534.5 21.0 878.7 18.0
Loan Health Property & Total
insurance insurance Casualty
EURm H1 10 % cha H1 10 % cha H1 10 % change H1 10 %cha
nge nge nge
France 1,184.8 5.1 242.7 8.4 0.0 - 14,098.3 -1.2
Italy (1) 58.5 50.5 0.0 - 0.0 - 1,918.7 6.5
Portugal (2) 30.6 38.1 0.0 - 0.0 -100.0 41.9 -65.1
Spain (4) 52.4 146.6 0.0 - 0.0 - 298.0 89.0
Cyprus/Greece 3.8 282.4 10.3 19.6 32.6 4.3 99.9 10.8
Other (Europe)
(3) 17.1 7.1 0.0 - 0.0 - 28.2 71.3
Brazil 105.4 56.5 0.0 - 127.4 33.1 1,205.4 45.6
Argentina 1.9 - 0.0 - 0.0 - 6.2 75.8
Sub-total
International 269.7 61.7 10.3 3.2 160.0 -18.4 3,598.3 19.3
TOTAL 1,454.4 12.4 253.0 8.2 160.0 -18.4 17,696.5 2.4
(1) Italian branches, CNP UniCredit Vita, Cofidis business in Italy for
the loan insurance segment, BVP Italy
(2) Cofidis Portugal for the loan insurance segment, BVP Portugal.
(3) Ireland, Cofidis business in Europe excluding Italy, Portugal and
Spain
(4) Spanish branches, Cofidis business in Spain and CNP Vida.
Investor Calendar
Third quarter 2010 premium income Wednesday, 10 November 2010
and results indicators
This press release, as well as the consolidated financial statements and the management report, are available in French and English on the CNP Assurances web site, http://www.cnp-finances.fr.
Disclaimer: Some of the statements contained in this press release may be forward-looking statements referring to projections, future events, trends or objectives which, by their very nature, involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated in such statements by reason of factors such as changes in general economic conditions and conditions in the financial markets, legal or regulatory decisions or changes, changes in the frequency and amount of insured claims, particularly as a result of changes in mortality and morbidity rates, changes in surrender rates, interest rates, foreign exchange rates, the competitive environment, the policies of foreign central banks or governments, legal proceedings, the effects of acquisitions and the integration of newly-acquired businesses, and general factors affecting competition.
Further information regarding factors which may cause results to differ materially from those projected in forward-looking statements is included in CNP Assurances' filings with the Autorite des Marches Financiers. CNP Assurances does not undertake to update any forward-looking statements presented herein to take into account any new information, future event or other factors.
---------------------------------
[1] Unless otherwise specified, all figures and growth rates are on an IFRS basis.
[2] Estimated data.
[3] The difference in growth rates between IFRS and French GAAP is due to the accounting treatment of unit-linked business. Under IFRS, only the loading on unit-linked sales is recognized in premium income whereas under French GAAP, the total premium is recognized.
[4] Before amortisation of VIF and VDA for a total of EUR 18 million in first-half 2010. The contribution of operations in Brazil was boosted by a favourable currency effect which helped to drive up EBIT from international operations to 34% of the consolidated total from 24% in first-half 2009.
[5] First-half 2009 premium income of EUR 270 million has been restated.
[6] Per share data are based on the number of ordinary shares outstanding after the early-July four-for-one stock-split, i.e. 594,151,292 shares.
Press Relations
Tamara Bernard
+33(0)1-42-18-86-19
E-mail : [email protected]
Investor and Analyst Relations
Jim Root
+33(0)1-42-18-71-89
Jean-Yves Icole
+33(0)1-42-18-94-93
E-mail : [email protected]
SOURCE CNP Assurances
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