|
Revenue: €7.0 billion
Net profit: €275
million
Solvency capital requirement covered 1.93 times including unrealised
gains
Reduced exposures to equities and peripheral sovereign
debt
Paris, 11 May 2012 – CNP Assurances, the leading personal
insurer in France with operations in the rest of Europe and in South America,
has announced its quarterly indicators for the first three months of 2012.
|
Highlights
- Revenue down 12.9% to €7 billion. Business was affected by the
on-going decline in savings markets in Europe. However, the personal
risk and term creditor insurance segments continued to grow.
- EBIT stable at €454 million.
- Net profit slightly higher at €275 million, supported by improved
financial markets in the first quarter and an assertive profit-taking
strategy.
- Reduced exposure to financial risks:
- Equities represented 8.6% of total assets compared with 9.3% at 31
December 2011.
- The Group pursued its strategy of selling peripheral euro zone
sovereign debt, reducing its exposure by 11% over the quarter (see
detailed table in the
appendices).
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Gilles Benoist, Chief Executive Officer, said:
"Despite the decline in revenue in a still adverse environment, CNP
Assurances continued to grow its technical reserves and lower its costs. The
business base is robust and with the improvement in market conditions in the
first three months we were able to lift our earnings while at the same time
actively pursuing our strategy to dispose of high-risk assets."
1. First-Quarter 2012 Business Review (1)
Consolidated revenue for the quarter amounted to €7.0 billion, down
12.9% on the yearearlier period (7.3% pro forma at constant exchange
rates). The decline was mainly attributable to Europe’s persistently
difficult savings markets, and to the major group pensions contract sold by CNP
Europe Life in first-quarter 2011 which lifted the basis of comparison by €442
million.
(1) All figures are presented on an IFRS basis unless
otherwise specified.
|
IFRS |
French GAAP |
| Revenue(in
€m) |
Q1
2012 |
%
change |
Q1
2012 |
%
change |
| Savings |
4,761.1 |
-11.8 |
4,981.3 |
-11.0 |
| Pensions |
749.7 |
-39.7 |
760.1 |
-41.0 |
| Personal
Risk |
515.2 |
+10.7 |
515.2 |
+10.6 |
| Term
Creditor Insurance |
787.9 |
+2.9 |
787.9 |
+2.9 |
| Health
Insurance |
126.5 |
+13.9 |
126.7 |
+14.1 |
| Property
& Casualty |
87.3 |
-0.3 |
87.3 |
-0.3 |
| Total |
7,027.7 |
-12.9 |
7,258.5 |
-12.7 |
Revenue in France declined 8.4% on a French GAAP basis, but the Group
continued to outperform the life and pensions market, which contracted by 13% in
the first quarter (source: FFSA, April 2012).
Outside France, revenue was down 30.1%, mainly due to the major pensions
contract sold in Ireland in first-quarter 2011, which inflated the basis of
comparison, and to unfavourable exchange rates in South America. Excluding both
these effects, international business contracted by just 4.2%. In Italy, revenue
grew by more than 10%. In Brazil, the top line was stable in euros, but up 6.8%
in local currency. In Spain and Portugal, revenue performance was adversely
affected by weaker sales of traditional savings products.
|
IFRS |
French GAAP |
Revenue
(in
M€) |
Q1
2012 |
%
change |
Q1
2012 |
%
change |
| France |
5,752.8 |
-7.9 |
5,764.0 |
-8.4 |
| Italy
(1) |
421.2 |
+10.5 |
482.8 |
+5.2 |
| Portugal
(2) |
5.9 |
-91.5 |
58.7 |
-35.5 |
| Brazil
(3) |
663.8 |
-0.3 |
768.8 |
+0.6 |
| Argentina
(4) |
13.9 |
+132.3 |
13.9 |
+132.3 |
| Spain
(4) |
120.0 |
-37.8 |
120.0 |
-37.8 |
| Cyprus |
47.9 |
-18.0 |
48.2 |
-20.6 |
| Ireland |
2.2 |
-99.5 |
2.2 |
-99.5 |
| Other
(5) |
0.0 |
- |
0.0 |
- |
Sub
total
international |
1,274.9 |
-30.1
(-4.2% pro forma at constant exchange
rates) |
1,494.5 |
-26.1
(-2.0 % pro forma at constant exchange
rates) |
| Total |
7,027.7 |
-12.9 |
7,258.5 |
-12.7 |
(1) CNP Italia branch. CNP UniCredit Vita and CNP BVP
Italy.
(2) CNP BVP Portugal.
(3) Based on exchange rates at 31 March
2012.
(4) CNP España branch, CNP Vida and CNP BVP Spain.
(5) Cofidis
Romania, Belgium, Czech Republic: €0.6 million in first-quarter 2011.
While sales of unit-linked contracts were understandably penalized by the
uncertainty surrounding uneven financial markets, these products nevertheless
continued to account for over 15% of total savings and pensions revenue .
Net new money was a negative €0.2 billion in first-quarter 2012. In France,
CNP Assurances and the life insurance market as a whole both experienced net
cash outflows during the period, of €0.3 billion and €2 billion (based on FFSA
and CNP Assurances estimates) respectively.
However, technical reserves increased by a further 2.2% to €290.7
billion.
In France, revenue contracted by 7.9% to €5,753 million,
mainly due to the decline in the savings market, which is still suffering the
effects of the economic crisis. In this challenging environment, CNP Assurances
continued to outperform the market.
In the personal risk segment and term creditor insurance segments,
revenues were up 9.7% and 6.6% respectively.
A. La Banque Postale
Revenue generated by La Banque Postale rose 9.6% to €2,688 million
in the first quarter of 2012. Business growth during the period was led
by higher sales of savings and personal risk contracts.
In the savings segment, revenue was lifted by promotional campaigns
launched at the beginning of the year.
The personal risk business remained buoyant. Revenues grew 5.1% thanks to
sustained demand for the network’s term life insurance and long-term care
offers, as well as for term creditor insurance with revenues up 21.4% despite
the slowdown in the home loan market.
B. Savings Banks
The Savings Banks’ revenue contribution fell by 29.0% to €1,877
million in the first quarter. The network focused on marketing bank
savings products during the period, but has scheduled a campaign to promote life
insurance products in the second quarter.
The contribution of unit-linked sales remained high nonetheless, at 14% of
savings and pensions revenue, helped by a marketing campaign for a fund invested
in a new BPCE bond issue.
Revenue was sustained by:
- Strong 14% growth in term creditor insurance revenue.
- A more than two-fold (116%) increase in personal risk premiums due to
successful sales of new funeral cover.
C. CNP Trésor
CNP Trésor generated revenue of €144 million. Down 4.4%
compared with the first quarter of 2011, this performance was still superior to
that of the market.
D. Financial Institutions
Revenue from the Group’s partner financial institutions edged up 1.3%
to €367 million. Despite an unfavourable housing market environment –
with a scaling back of incentives for first-time buyers and application of
tougher loan acceptance criteria – CNP Assurances maintained a solid overall
revenue base in the shape of its existing portfolio. New business accounted for
only a small portion of the total and there were very few loan
renegotiations.
E. Companies & Local Authorities
The Companies & Local Authorities partnership centre generated
revenue of €419 million, down 3.5%. In the personal risk segment,
revenue should increase in 2012 as a result of rate increases negotiated in
2011. However, growth in the pensions segment is expected to be more restrained
this year in light of the economic crisis.
F. Mutual Insurers
Revenue generated by the Mutual Insurers partnership centre surged
25.8% to €237 million. This robust growth was partly attributable to
the inclusion of MFPrévoyance in the scope of consolidation. CNP Assurances also
continued to nurture relations with its large mutual insurance partners,
particularly in the long-term care segment.
Revenue outside France declined by 30.1% over the period. However, excluding
the high basis of comparison created by the major group pensions contract sold
in first-quarter 2011 by CNP Europe Life in Ireland, and before taking into
account the currency effect, business was down just 4.2%.
In Southern Europe, excluding Italy, sales of traditional savings products
slowed due to the general financial environment. Term creditor insurance revenue
contracted as a result of the fall-off in bank lending activity and the
single-premium basis method of accounting. In South America, the most profitable
segments advanced at a satisfactory pace.
A. Caixa Seguros (Brazil)
The overall insurance market in Brazil expanded by a further 14.0% in
first-quarter 2012, led by favourable demographic trends and the growing middle
class.
In this environment, Caixa Seguros’s revenue rose 7% in local
currency, including 17.5% growth in the savings business alone.
However, due to unfavourable exchange rates, Brazil’s contribution to
consolidated revenue was down 0.3% after conversion into euros. New money
continued to grow rapidly in the business segments that contribute the most to
earnings, with personal risk premiums up 23.2% and term creditor
insurance premiums up 26.6% in local currency.
B. CNP UniCredit Vita (Italy)
Italian subsidiary CNP UniCredit Vita reported solid 11.7%
growth (in a life insurance market down 31% in the first two months of
2012), led by strong sales of UniValore and UniPlan unit-linked
contracts. The pensions, personal risk and term creditor insurance
segments declined significantly; however, these businesses are marginal,
representing revenues of less than €10 million.
C. CNP Barclays Vida y Pensiones (Portugal, Spain and
Italy)
CNP BVP experienced a significant slowdown in sales of traditional savings
products during the period. As a result, its revenue fell by a sharp 46.2% in
comparison to the first quarter of 2011, which had nevertheless represented a
high basis of comparison with revenue six times higher than in the same period
of 2010.
D. CNP Marfin Insurance Holding
(Cyprus/Greece)
Revenue from CNP Marfin Insurance Holding was down 18%, mainly as a result of
the recognition in first-quarter 2011 of a large single premium. In a still
difficult economic environment, the subsidiary continued to expand in Property
& Casualty insurance.
2. First-quarter 2012 profit
indicators
|
Q1 2012
in €m |
Q1 2011
in €m |
%
change |
|
|
| Revenue |
7,028 |
8,071 |
- 12.9% |
| Average
technical reserves |
290,699 |
284,225 |
|
| Net
insurance revenue* |
678 |
678 |
- |
| -
Expenses |
(223) |
(225) |
|
| EBIT |
454 |
453 |
+ 0.2% |
| -
Finance costs |
(39) |
(30) |
|
| -
Income tax expense |
(144) |
(137) |
|
| -
Minority interests |
(74) |
(64) |
|
| Attributable
recurring profit before capital gains |
197 |
222 |
- 11.2% |
| Net
realised gains on equities and investment property |
75 |
10 |
|
| Fair
value adjustments to trading securities |
87 |
38 |
|
| Non-recurring
items** |
(84) |
0 |
|
| Net
profit |
275 |
270 |
+ 1.8% |
* - Net insurance revenue for the first quarter of
2011 totalled €634.9 million excluding changes in Group-level
provisions and
€678 million including changes in Group-level provisions.
- * - Net insurance
revenue for the first quarter of 2012 totalled €678 million including changes in
Group-level
provisions for €8 million.
** Mainly corresponding to
increases and decreases in the policyholders’ surplus reserve.
Net insurance revenue was stable at €678 million. Excluding
own-funds portfolios, it dipped 4.3% to €485 million, mainly due to the impact
of weaker savings business in France. Net insurance revenue from
international operations increased by 11.2% to €275 million, helped by positive
contributions from the main subsidiaries, Caixa Seguros, CNP UniCredit Vita and
CNP BVP. Net insurance revenue from own-funds portfolios was up 45% to
€185 million, reflecting the increase in bond revenues following recent
investments in this asset class as well as the impact of profit-taking on the
equities portfolio in the first quarter.
Thanks to disciplined cost control, which reduced costs both
in France and internationally, EBIT rose by a slight 0.2% to €454 million for
the first quarter.
The bottom line benefitted from:
- Capital gains on disposals of equities and investment property realised
as
part of a multi-year programme.
- Asset impairment reversals.
- Improved financial market conditions in the first quarter of 2012.
Net profit came to €275 million for the period, up 1.8%.
As regards peripheral euro zone bond exposures, CNP Assurances pursued its
assertive disposal strategy during the period, with a focus on selling Italian
and Spanish bonds. Following the Greek debt exchange, the value of new Greek
bonds in the portfolio represented 23% of the old bonds’ principal. Given that
the necessary provisions had already been set aside, no additional income
statement impact was recognised in the first quarter of 2012. CNP Assurances
shifted its investment focus to French bonds (see details of sovereign debt
exposures in the appendix).
3. Solvency capital
The solvency capital requirement under Solvency I was covered 1.13 times
based on Tier 1 capital at 31 March 2012, and 1.93 times including unrealised
gains thanks to a sharp increase in unrealised gains – mainly on bonds – in the
first quarter.
Disclaimer: Some of the statements contained in this
press release may be forward-looking statements referring to projections, future
events, trends or objectives that, 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 newlyacquired
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 Autorité des Marchés 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.
See also
2012 First-quarter premium income
Investor Calendar
|
Annual General Meeting |
Friday, 29 June 2012 at 2:00 pm at Palais des Congrès in
Paris1 |
|
First-half 2012 revenue and net
profit |
Friday, 27 July 2012 at 7:30 am |
|
Nine-month 2012 revenue and profit
indicators |
Wednesday, 14 November 2012 at 7:30
am |
Press
Relations
Florence de
Montmarin
Tel : +33
(0)1 42 18 86 51
Tamara Bernard
Tel : +33 (0)1 42 18 86
19
E-mail : servicepresse@cnp.fr
Investor and Analyst
Relations
Jim Root
Tel : +33 (0)1 42 18 71 89
Annabelle
Beugin-Soulon
Tel : +33 (0)1 42 18 83 66
Jean-Yves Icole
Tel : +33 (0)1
42 18 94 93
E-mail : infofi@cnp.fr |
