INTERIM REPORT 8 MAY 2012 Q1 - Sampo Group · Sampo Group Interim report Q1/2012 BuSiNESS arEaS 6...
Transcript of INTERIM REPORT 8 MAY 2012 Q1 - Sampo Group · Sampo Group Interim report Q1/2012 BuSiNESS arEaS 6...
Q1January–March 2012
INTERIM REPORT 8 MAY 2012
Sampo Group Interim report Q1/2012 CONTENTS
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Q1Summary 3BuSiNESS arEaS 4 p&C insurance 4 associated company Nordea Bank 7 Life insurance 9 Holding 11OThEr dEvElOpmENTS 12 annual General meeting 12 personnel 12 management incentive schemes 13 Shares and share capital 13 ratings 13 Group solvency 14 Debt financing 15OuTlOOk 16 The major risks and uncertainties to the Group in the near term 16 outlook for the rest of 2012 16TaBlES 31 marCh 2012 18 Group financial review 18 Calculation of key figures 19 Group quarterly comprehensive income statement 21 Consolidated comprehensive income statement, IFrS 22 Consolidated balance sheet, IFrS 23 Statement of changes in equity, IFrS 24 Statement of cash flows, IFrS 25Notes 26 accounting policies 26 Comprehensive income statement by segment for three months ended 31 march 2012 27 Comprehensive income statement by segment for three months ended 31 march 2011 28 Consolidated balance sheet by segment at 31 march 2012 29 Consolidated balance sheet by segment at 31 December 2011 30Other notes 31 1 Insurance premiums 31 2 Net income from investments 32 3 Claims incurred 35 4 Staff costs 36 5 Intangible assets 37 6 Financial assets 38 7 Derivative financial instruments 40 8 Investments related to unit-linked insurance 41 9 Liabilities for insurance and investment contracts 42 10 Liabilities from unit-linked insurance and investment contracts 43 11 Financial liabilities 44 12 Contingent liabilities and commitments 45 13 result analysis of p&C insurance business 47 14 Sampo plc’s income statement and balance sheet (FaS) 48
Contents
Sampo Group Interim report Q1/2012 Summary
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A very good start for the year
EURm 1–3/2012 1–3/2011 Change, %
Profit before taxes 363 387 -6
P&C insurance 191 221 -13
Life insurance 33 44 -24
Associates (Nordea) 158 152 4
Holding excl. associates -19 -30 36
Profit for the period 317 325 -2
Change
Earnings per share, EUR 0.57 0.58 -0.01
EPS, mark-to-market, EUR 1.17 0.41 0.76
NAV per share, EUR *) 16.61 14.05 2.56
Average number of staff (FTE) 6,796 6,872 -76
Group solvency ratio, % *) 150.5 138.6 11.9
RoE, % 28.3 10.3 18.0
The figures in this report are not audited. Income statement items are compared on a year-on-year basis whereas comparison figures for balance sheet items are from 31 December 2011 unless otherwise stated.
Sampo Group’s profit before taxes for January - March 2012 amounted to EUR 363 million (387). The total comprehensive income for the period, taking changes in the market value of assets into account, rose to EUR 654 million (232).
• Earnings per share amounted to Eur 0.57 (0.58) and mark-to-market EpS was Eur 1.17 per share (0.41). The return on equity for the Group amounted to 28.3 per cent for the period (10.3).
• Net asset value per share rose to Eur 16.61 (14.05). The fair value reserve after tax on the Group level increased to Eur 660 million (355).
• In the p&C insurance operations the combined ratio for the first quarter of 2012 was excellent and amounted to 92.4 per cent (94.4). This is the best first quarter combined ratio in If’s history. The profit before taxes was Eur 191 million (221). The underlying profitability improved as the comparison figure contains a one-off sales gain of Eur 75 million. mark-to-market result rose to Eur 323 million (91). return on equity increased to 50.2 per cent (14.0).
• Nordea is accounted for as an associated company. Sampo’s share of Nordea’s profit for the first quarter of 2012 was Eur 158 million (152).
• profit before taxes for the life insurance operations decreased to Eur 33 million (44) as Eur 17 million was used to lower the 2012 and 2013 discount rates to 2.5 per cent and 3.25 per cent, respectively. The mark-to-market result increased to Eur 172 million (13). The return on equity at market value rose to 72.3 per cent (5.0).
Sampo pLC INTErIm rEporT 8 may 2012
Key figures
*) comparison figure from 31.12.2011
Sampo Group’s results for January-march 2012
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Business areas p&C insurance
If p&C is the leading property and casualty insurance company in the Nordic region, with insurance operations that also encompass the Baltic countries and russia. The p&C insurance group’s parent company, If p&C Insurance Holding Ltd, is located in Sweden, and the If subsidiaries provide insurance solutions and services in Finland, Sweden, Norway, Denmark, the Baltic countries and russia. If’s operations are divided into four business areas: private, Commercial, Industrial and Baltic.
Business areas in 2011
Eurm 1–3/2012 1–3/2011 Change, %
Premiums written, net 1,591 1,520 5
Net income from investments 103 171 -40
Other operating income 9 9 5
Claims incurred -736 -712 3
Change in insurance liabilities -525 -517 1
Staff costs -138 -127 9
Other operating expenses -119 -115 4
Finance costs -5 -7 -36
Share of associates’ profit/loss 11 0 -
profit before taxes 191 221 -13
Change
Combined ratio, % 92.4 94.4 -2.0
Risk ratio, % 69.0 71.0 -2.0
Cost ratio, % 23.4 23.4 0
Expense ratio, % 16.9 16.9 0
Return on equity, % 50.2 14.0 36.2
Average number of staff (FTE) 6,211 6,316 -105
profit before taxes for p&C insurance decreased to Eur 191 million (221) in January-march 2012. The decrease is explained by lower net income from investments in relation to the previous year due to a one-off sales gain of Eur 75 million in the comparison period.
Both risk ratio and combined ratio improved in the first quarter of 2012 to 69.0 per cent (71.0) and 92.4 per cent (94.4), respectively. Eur 26 million (39) was released from technical reserves relating to prior year gains. Change in the interest rate used to discount the annuity reserves in Sweden improved the result by Eur 12 million.
Technical result increased to Eur 112 million (100). Technical result for private business area increased to Eur 68 million (56), for Commercial to Eur 26 million (23) and for Baltic (excl. russia) to Eur 4 million (2). For business area Industrial technical result decreased to Eur 13 million (16). Insurance margin (technical result in relation to net premiums earned) improved to 10.3 per cent (9.7).
Results
Key figures
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Combined ratio,% Risk ratio,%
1-3/2012 1-3/2011 Change 1-3/2012 1-3/2011 ChangePrivate 91.5 94.0 -2.5 67.9 70.6 -2.7Commercial 94.8 96.7 -1.9 71.0 72.8 -1.8Industrial 92.4 91.5 0.9 71.9 70.4 1.5Baltic 89.0 98.6 -9.6 57.4 62.8 -5.4 Sweden 87.2 92.9 -5.7 64.0 70.6 -6.6Norway 93.4 96.5 -3.1 70.1 73.3 -3.2Finland 92.7 93.9 -1.2 70.6 70.6 0Denmark 107.8 94.3 13.5 81.6 66.7 14.9
risk ratio improved in all business areas except Industrial due to less winter related claims than in the comparison period. In Denmark risk ratio deteriorated due to higher large claims in business area Commercial.
Gross written premiums increased 5.1 per cent to Eur 1,701 million (1,618). adjusted for currency, premiums increased 4.7 per cent. all business areas and countries had positive growth. In private gross written premiums adjusted for currency increased by 4.1 per cent. In Commercial the growth was 4.1 per cent as well, in Industrial 5.7 per cent and in Baltic 1.3 per cent.
Cost ratio remained at previous year’s level and was 23.4 per cent (23.4). adjusted for currency the nominal costs increased 5.6 per cent.
return on equity (roE) increased significantly to 50.2 per cent (14.0) supported by the strong mark-to-market investment result in the first quarter. Fair value reserve increased from the year end to Eur 297 million (139) at the end of march 2012.
Topdanmark’s profit contribution for January-march 2012 was Eur 12 million. at the end of march 2012 If p&C held altogether 3,147,692 Topdanmark shares, corresponding to 24.2 per cent of the votes and 22.9 per cent of the shares.
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at the end of march 2012 the total investment assets of If p&C amounted to Eur 11.8 billion (11.2).
Net income from investments decreased to Eur 103 million (171) due to a large one-off sales gain from equities in the comparison period.
Investment return mark-to-market for January-march 2012 was 2.9 per cent (0.7).
Duration for interest bearing assets was 1.3 years (1.2) and average maturity 2.5 years. Fixed income running yield was 3.9 per cent (4.1).
If p&C’s solvency ratio as at 31 march 2012 (solvency capital in relation to net written premiums) was 78 per cent (72). Solvency capital amounted to Eur 3,414 million (3,080). reserve ratios decreased to 164 per cent (167) of net written premiums and 219 per cent (229) of claims paid. The decrease versus claims paid is mainly due to increased property claims payments in business area Industrial during year 2011 and first quarter of 2012.
Investment allocation, If P&C, total EUR 11.8 billion
Money Market 9%
Fixed Income 78%
Equities 11%
Private Equity 0.3%
Real Estate 1%
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associated company Nordea Bank
on 31 march 2012 Sampo plc held 860,440,497 Nordea shares corresponding to a holding of 21.3 per cent. The average price paid per share amounted to Eur 6.46 and the book value in the Group accounts was Eur 7.21 per share. The closing price as at 31 march 2012 was Eur 6.80.
Sampo’s holding exceeds 20 per cent and Nordea has been accounted as an associated company in Sampo Group’s accounts since 31 December 2009. Sampo’s share of Nordea’s net profit is shown on the face of Sampo Group’s profit and loss account on the line Share of associate’s profit/loss.
In the first quarter of 2012 Nordea’s strong business momentum continued. profitability was maintained at a high level, with an roE close to 12 per cent. Costs were kept under strict control and the capital position strengthened further. Core tier 1 capital ratio increased by 0.4 percentage point to 11.6 per cent.
Nordea paid a total dividend of Eur 1,048 million, of which Sampo plc’s share amounted to Eur 224 million.
The following text is based on Nordea’s January - march 2012 interim report published on 24 april 2012.
First quarter 2012 vs first quarter 2011 (first quarter 2012 vs fourth quarter 2011):
• Net interest income up 7 per cent (largely unchanged)
• operating profit up 3 per cent (up 1 per cent)
• Core tier 1 capital ratio increased to 11.6 per cent excluding transition rules from 10.7 per cent (up from 11.2 per cent in the fourth quarter)
• Cost / income ratio unchanged at 50 per cent (up from 49 per cent in the fourth quarter)
• Net loan losses down to 26 basis points from 31 basis points (down from 33 in the fourth quarter)
• return on equity 11.7 per cent, down from 12.0 per cent in the first quarter 2011 (down from 12.3 per cent in the fourth quarter)
Total income decreased 1 per cent from the previous quarter to Eur 2,531 million. Net interest income was largely unchanged compared to the previous quarter at Eur 1,420 million. Net interest income decreased in business areas, due to one banking day less in the quarter. Net fee and commission income increased 1 per cent to Eur 596 million. Increases were mainly seen in savings-related commissions. Commission expenses for stability fund in Sweden and the deposit guarantee fund in Denmark were Eur 20 million, up somewhat from the previous quarter, due to the new deposit guarantee fund system in Denmark.
Net loan loss provisions decreased to Eur 218 million, including a provision for the Danish guarantee system related to Fjordbank mors of Eur 8 million. Excluding these deposit guarantee-related provisions, the loan loss ratio was 25 basis points (36 basis points in the previous quarter). as expected, provisions for future loan losses in shipping and Denmark remained at elevated levels, whereas in other areas the losses decreased from already moderate levels. The overall credit quality is solid with strongly rated customers and stable rating migration.
operating profit increased 1 per cent from the previous quarter to Eur 1,037 million. risk-adjusted profit
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decreased to Eur 799 million, down 2 per cent from the previous quarter and up 4 per cent compared to the first quarter last year. Net profit decreased 1 per cent compared to the previous quarter to Eur 775 million, corresponding to a return on equity of 11.7 per cent. return on equity decreased compared to the previous quarter due to higher effective tax rate and higher average equity in the quarter. Diluted earnings per share were Eur 0.19 (Eur 0.19 in the previous quarter).
Total expenses amounted to Eur 1,276 million, largely unchanged compared to the previous quarter in local currencies. Staff costs increased 7 per cent in local currencies to Eur 771 million, mainly due to low pension costs in the fourth quarter. adjusted for this, staff costs increased 1.7 per cent in the first quarter. other expenses decreased 10 per cent in local currencies to Eur 455 million, due to seasonal effects. Compared to the first quarter last year, total expenses were largely unchanged in local currencies.
The reduction in staff numbers which was announced last autumn has continued according to plan during the first quarter. The number of employees (FTEs) has been reduced by around 1,600 from the end of the second quarter 2011 and by around 500 compared to the end of the fourth quarter 2011. This has resulted in an annualised gross reduction in the staff expenses of approx. Eur 120 million.
The Group’s core tier 1 capital ratio, excluding transition rules, was 11.6 per cent at the end of the first quarter and was strengthened by 0.4 percentage points from the previous quarter. Improved capital ratios have been achieved by strong profit generation and a decrease in risk-weighted assets (rWa), mainly as a result of IrB approval for the corporate and institutions portfolio in the International units. This IrB approval affected rWa with a reduction of Eur 3.1 billion.
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profit before taxes in life insurance for January-march 2012 decreased to Eur 33 million (44). Eur 17 million was used to lower the interest rate used to discount all with-profit liabilities to 2.50 per cent for 2012 and to 3.25 per cent for 2013, respectively. all in all, mandatum Life has increased its technical reserves with Eur 117 million due to low level of interest rates. return on equity (roE) rose to 72.3 per cent (5.0). The total comprehensive income for the period, taking changes in the market value of assets into account, rose to Eur 172 million (13).
Life insurance
mandatum Life Group consists of mandatum Life, a wholly-owned subsidiary of Sampo plc, operating in Finland, and its subsidiary mandatum Life Insurance Baltic SE, which has the form of a European company and is headquartered in Estonia. It operates in the other Baltic countries through branches.
Eurm 1-3/2012 1-3/2011 Change, %
Premiums written 260 216 20
Net income from investments 271 96 183
Other operating income 1 0 -
Claims incurred -203 -222 -8
Change in liabilities for
inv. and ins. contracts -266 -19 -
Staff costs -11 -10 5
Other operating expenses -17 -15 13
Finance costs -3 -3 -4
profit before taxes 33 44 -24
Change
Expense ratio, % 120.8 121.8 -1.0
Return on equity, % 72.3 5.0 67.3
Average number of staff (FTE) 530 503 27
Results
Key figures
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Excluding the assets of Eur 3.4 billion (3.1) covering unit-linked liabilities, mandatum Life Group’s investment assets amounted to Eur 5.5 billion (5.4) at market values as at 31 march 2012.
Net income from investments, excluding income on unit-linked contracts, amounted to Eur 86 million (115). Net income from unit-linked investments was Eur 185 million (-19).
Investment return mark-to-market during January – march 2012 was 5.2 per cent (1.4). The fair value reserve increased to Eur 359 million from Eur 214 million at the end of 2011. at the end of march 2012 the duration of fixed income assets was 1.8 years (1.8) and average maturity 2.4 years. Fixed income running yield was 5.3 per cent (5.4).
mandatum Life’s solvency position strengthened further during the first quarter of 2012. mandatum Life Group’s solvency ratio as at 31 march 2012 was 24.8 (20.9). mandatum Life Group’s total technical reserves were Eur 7.6 billion (7.3), of which unit-linked reserves accounted for 3.4 billion (3.1). The unit-linked reserves reached an all-time high and their share of total technical reserves increased to 44 per cent (42).
Expense result for the Group’s life insurance segment was Eur 0 million (0) for January – march 2012. Because expenses are partly front-loaded and the earnings potential has increased due to the increase in unit-linked savings, expense result is expected to rise to at least previous year’s level. mandatum Life does not defer acquisition costs, which burdens the result for the sales year.
mandatum Life Group’s premium income on own account increased by 20 per cent and amounted to Eur 260 million (216). premium income from the Baltic countries decreased clearly and was Eur 5 million (12). mandatum Life’s overall market share in Finland measured by premium income increased to 27.0 per cent (22.2) and market share in unit-linked business to 30.1 per cent (25.0).
Investment allocation,Mandatum Life, total EUR 5.5 billion
Money Market 8%
Fixed Income 51%
Equities 28%
Private Equity 5%
Real Estate 3%
Other 5%
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Holding
Sampo plc controls its subsidiaries engaged in p&C and life insurance. In addition on 31 march 2012 Sampo plc held 21.3 per cent of the share capital of Nordea, the largest bank in the Nordic countries. Nordea is an associated company to Sampo plc.
The segment’s profit before taxes amounted to Eur 139 million (122), of which Eur 158 million (152) relates to Sampo’s share of Nordea’s first quarter 2012 profit. The segment, excluding share of Nordea’s profit, reported a loss of Eur 19 million (-30).
Sampo plc’s holding in Nordea Bank was booked in the consolidated balance sheet at Eur 6.2 billion. The market value of the holding was Eur 5.9 billion as at 31 march 2012. In addition the assets on Sampo plc’s balance sheet as at 31 march 2012 included holdings in subsidiaries for Eur 2.4 billion (2.4).
In the first quarter of 2012 no dividends were paid to Sampo plc by its insurance subsidiaries. a dividend of Eur 224 million was received on 3 april 2012 from the associated company Nordea.
Eurm 1-3/2012 1-3/2011 Change, %
Net investment income 10 4 134
Other operating income 4 4 1
Staff costs -4 -4 12
Other operating expenses -4 -3 16
Finance costs -24 -30 -20
Share of associates’ profit 158 152 4
profit before taxes 139 122 14
Change
Average number of staff (FTE) 55 53 2
Results
Sampo Group Interim report Q1/2012 OThEr dEvElOpmENTS
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Other developments
annual General meetingThe annual General meeting of 12 april 2012 decided to distribute a dividend of Eur 1.20 per share for 2011. The record date for dividend payment was 17 april 2012. The dividend was paid on 24 april 2012. The annual General meeting adopted the financial accounts for 2011 and discharged the Board of Directors and the Group CEo and president from liability for the financial year.
The number of members of the Board was increased with one to nine members. The following members were re-elected to the Board of Directors: anne Brunila, adine Grate-axén, Veli-matti mattila, Eira palin-Lehtinen, Jukka pekkarinen, Christoffer Taxell, matti Vuoria and Björn Wahlroos. per arthur Sørlie was elected as a new Board member.
at its organizational meeting, the Board elected Björn Wahlroos as Chairman and matti Vuoria as Vice Chairman. The following members were elected to the Nomination and Compensation Committee: Veli-matti mattila, Eira palin-Lehtinen, Christoffer Taxell, matti Vuoria, and Björn Wahlroos (Chairman). anne Brunila (Chairman), adine Grate axén, Jukka pekkarinen and per arthur Sørlie were elected to the audit Committee.
The annual General meeting decided to pay the following fees to the members of the Board of Directors until the close of the 2013 annual General meeting: the Chairman of the Board will be paid Eur 160,000 per year, the Vice Chairman Eur 100,000 per year and the other members Eur 80,000 per year. In addition potential statutory social and pension costs incurring to non-Finnish members according to applicable national legislations will be borne by Sampo plc. after deduction of taxes and similar payments, approximately 50 per cent of the Board members’ annual compensation will be paid in Sampo a shares and the rest in cash.
Ernst & Young oy was elected as auditor. The auditor will be paid a fee determined by a reasonable invoice. Heikki Ilkka, apa, was re-elected as the principally responsible auditor.
personnel The number of full-time equivalent staff decreased to 6,805 employees (6,810) as at 31 march 2012. In p&C insurance, the number of staff mainly decreased in Norway and the Baltic and russian operation. In life insurance, the number of staff increased both in Finland and the Baltics.
During January-march 2012, approximately 91 per cent of the staff worked in p&C insurance, 8 per cent in life insurance and 1 per cent in the Group’s parent company Sampo plc. Geographically, 32 per cent worked in Finland, 27 per cent in Sweden, 22 per cent in Norway and 19 per cent in the Baltic countries, russia, Denmark and other countries. The average number of employees during January-march 2012 was 6,796 which compares to an average of 6,872 during the corresponding period in 2011.
Sampo Group Interim report Q1/2012 OThEr dEvElOpmENTS
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management incentive schemes The variable compensation in Sampo Group is divided into short-term and long-term compensation. The short-term compensation is based on annual performance whilst the long-term compensation is carried out through the management incentive schemes.
In the first quarter of 2012 no payments (0) were made on the basis of the long-term management incentive schemes. as short-term variable compensation Eur 1 million (1) was paid during the first quarter of 2012.
The terms of the long-term incentive schemes and Sampo Group’s compensation principles are available on Sampo’s website at www.sampo.com/compensation.
Shares and share capitalas at 31 march 2012, Sampo plc had 560,000,000 shares, which were divided into 558,800,000 a shares and 1,200,000 B shares. Total number of votes attached to the shares is 564,800,000. Each a share entitles the holder to one vote and each B share entitles the holder to five votes at the General meeting of Shareholders. Sampo plc didn’t hold any of its own a shares at the end of march 2012. Neither did the other Group companies hold any shares in the parent company.
The annual General meeting of 12 april 2012 authorized the Board to acquire in one or several lots a maximum of 50,000,000 Sampo a shares. Shares can be repurchased in other proportion than the shareholders’ proportional shareholdings (private repurchase). The share price will be no higher than the highest price paid for Sampo shares in public trading at the time of purchase. The authorization will be valid until the close of the next annual General meeting, nevertheless not more than 18 months after aGm’s decision.
ratingsall the main ratings for Sampo Group companies remained unchanged in the first quarter of 2012. Rated company Moody’s Standard and Poor’s
rating Outlook rating Outlook Sampo plc Baa2 Stable Not rated -
If P&C Insurance Ltd (Sweden) A2 Stable A Stable
If P&C Insurance Company Ltd (Finland) A2 Stable A Stable
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Group solvency Sampo Group, with Nordea Bank aB (publ) as its associated company, is regarded as a financial and insurance conglomerate according to the act on the Supervision of Financial and Insurance Conglomerates (2004/699).
Group solvency is calculated according to Chapter 3 of the act on the Supervision of Financial and Insurance Conglomerates (2004/699). The act is based on Directive 2002/87/EC of the European parliament and of the Council on the supplementary supervision of credit institutions, insurance undertakings and investment.
Sampo Group solvencyEURm 31 March 2012 31 December 2011
Group capital 9,571 8,920Sectoral items 1,242 1,091Intangibles and other deductibles -2,558 -2,545Dividends and planned dividends -840 -672Group's own funds, total 7,415 6,794
Minimum requirements for own funds, total 4,927 4,902
Group solvency 2,487 1,892
Group solvency ratio(Own funds % of minimum requirements) 150.5 138.6
The Group’s solvency ratio (own funds in relation to minimum requirements for own funds) was 150.5 per cent (138.6) as at 31 march 2012. Nordea is treated as an associated company in the solvency calculation and the part of Nordea’s capital requirement corresponding to Sampo’s holding in Nordea is taken into account in the Group’s capital requirement.
In Sampo Group solvency is assessed internally by comparing the capital required to the capital available. Capital requirement assessment is based on an economic capital framework, in which Group companies quantify the amount of capital required for measurable risks over a one year time horizon at 99.5 per cent´s confidence level. In addition to economic capital companies are assessing their capital need related to non-measurable risks like risks in business environment.
Capital available or adjusted Solvency Capital include regulatory capital and in addition other loss absorbing items like the effect of discounting technical reserves and other reserves excluded from regulatory capital.
The economic capital tied up in Group’s operations on 31 march 2012 was Eur 4,629 million (4,374) and adjusted solvency capital was Eur 7,884 million (7,262).
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Debt financingIn February 2012 Sampo plc issued a 5-year senior bond of Eur 500 million under the Euro medium Term Note programme. It also bought back the april 2012 bond with Eur 250 million.
Sampo plc’s debt financing on 31 march 2012 amounted to Eur 2,534 million (2,329) and interest bearing assets including bank accounts to Eur 1,277 (1,121) million. During the first quarter the net debt increased Eur 49 million to Eur 1,257 (1,208). Gross debt to Sampo plc’s equity was 36.6 per cent (34.6).
after the end of the reporting period Sampo plc paid a total of Eur 672 million in dividends, used Eur 355 million to repay rest of the april 2012 bond and received a dividend of Eur 224 million from Nordea. Together these measures increased the net debt to approximately Eur 1,750 million at the end of april.
as at 31 march 2012 financial liabilities in Sampo plc’s balance sheet consisted of issued senior bonds and notes of Eur 1,932 million (1,677) and Eur 602 million (652) of outstanding Cps issued. The average interest on Sampo plc’s debt as of 31 march 2012 was 3.36 per cent (3.73).
To balance the risks on the Group level Sampo plc‘s debt is mainly tied to short-term interest rates and issued in euro or Swedish krona. The debt positions are managed with interest rate swaps. These derivatives are valued at fair value in the profit and loss account although economically they match the underlying bonds. as a result Sampo plc maintains the flexibility to adjust derivative position if needed but this comes at the cost of increased volatility in the Holding segment’s finance costs.
more information on Sampo Group’s outstanding debt issues is available at www.sampo.com/debtfinancing.
Sampo Group Interim report Q1/2012 OuTlOOk
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Outlook for the rest of 2012The major risks and uncertainties to the Group in the near term The major risks Sampo Group is exposed to in its normal business activities are market risk, credit risks and insurance risks. Their contributions to Group’s Economic Capital requirement are currently within normal boundaries at levels 39 per cent, 36 per cent and 14 per cent, respectively.
Sovereign debt crisis, crisis of political system, potential banking crisis and slow growth in Europe may escalate in ways that can affect Group’s activities unfavorably although Sampo Group companies do not have direct exposures in sovereigns under pressure and have small exposure to banking sector outside the Nordic region.
outlook for the rest of 2012 Sampo Group’s business areas are expected to report good operating results for 2012. However, the mark-to-market results are, particularly in life insurance, highly dependent on capital market developments.
p&C insurance operations are expected to reach their long-term combined ratio target of below 95 per cent in 2012. Nordea’s contribution to the Group’s profit is expected to be significant.
SAMPO PLC Board of Directors
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For more information, please contactpeter Johansson, Group CFo, tel. +358 10 516 0010Jarmo Salonen, Head of Investor relations and Group Communications, tel. +358 10 516 0030Essi Nikitin, Ir manager, tel. +358 10 516 0066maria Silander, press officer, tel. +358 10 516 0031
Telephone conference Sampo will arrange a telephone conference for investors and analysts at 4 pm finnish time (2 pm uk time). The call is held in English.
please call +44 20 3003 2666 (Standard international access), 0800 914 672 (Finland), 0808 109 0700 (uK Toll Free) or +1 866 966 5335 (North america).
please be ready to state the conference name ‘Sampo plc Q1 release’.
The telephone conference can also be followed from a direct transmission on the Internet at www.sampo.com/result. a recorded version will later be available at the same address.
In addition a Supplementary Financial Information is available at www.sampo.com/result.
Interim report for January–June 2012 Sampo will publish the second quarter 2012 interim report on 8 august 2012.
DISTrIBuTIoN: NaSDaQ omX Helsinki The principal media Financial Supervisory authority www.sampo.com
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
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Group financial review
financial highlights
Group 1–3/2012 1–3/2011
Profit before taxes EURm 363 387Return on equity (at fair value) % 28.3 10.3Return on assets (at fair value) % 13.0 5.6Equity/assets ratio % 29.9 29.6Group solvency ¹) EURm 2,487 2,683Group solvency ratio % 150,5 157.7Average number of staff 6,796 6,872
Property & casualty insurancePremiums written before reinsurers' share EURm 1,701 1,618Premiums earned EURm 1,066 1,003Profit before taxes EURm 191 221Return on equity (at current value) % 50.2 14.0Risk ratio ²) % 69.0 71.0Cost ratio ²) % 23.4 23.4Loss ratio, excl. unwinding of discounting ²) % 75.5 77.5Expense ratio ²) % 16.9 16.9Combined ratio, excl. unwinding of discounting % 92.4 94.4Average number of staff 6,211 6,316
Life insurancePremiums written before reinsurers' share EURm 263 220Profit before taxes EURm 33 44Return on equity (at current value) % 72.3 5.0Expense ratio % 120.8 121.8Average number of staff 530 503
HoldingProfit before taxes EURm 68 122Average number of staff 55 53
Per share key figuresEarnings per share EUR 0.57 0.58Earnings per share, incl. other comprehensive income EUR 1.17 0.41Capital and reserves per share EUR 17.09 16.25Net asset value per share EUR 16.61 17.71Adjusted share price, high EUR 22.19 23.29Adjusted share price, low EUR 18.46 19.97Market capitalisation EURm 11,850 12,634
¹) The Group solvency is calculated according to the consolidation method defined in Chapter 3 of the Act on the Supervision of Financial and Insurance Conglomerates (2004/699).
²) The key figures for P&C Insurance are based on activity based costs and cannot, therefore, be calculated directly from the consolidated income statement. The result analysis of P&C insurance is presented in note 13.
The number of shares used at the balance sheet date and as the average number during the financial period was 560,000,000.
The valuation differences on investment property have been taken into account in calculating the return on assets, return on equity, equity/assets ratio and net asset value per share. The tax component includes the tax corresponding to the result for the period, and the deferred tax liability related to valuation differences on investment property.
The total comprehensive income has been used in the calculation of the return on assets and return on equity.
The key figures for the insurance business have been calculated in accordance with the decree issued by the Ministry of Finance and the specifying regulations and instructions of the Finance Supervisory Authority.
Tables 31 march 2012
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
19
Calculation of key figures
Return on equity (fair values), % + total comprehensive income
valuation differences on investments less deferred tax x 100 %+ total equity
valuation differences on investments less deferred tax (average of values 1 Jan. and the end of reporting period)
Return on assets (at fair values), % + operating profit
other comprehensive income before taxes+ interest and other financial expense + calculated interest on technical provisions
change in valuation differences on investments x 100 %+ balance sheet, total – technical provisions relating to unit-linked insurance
valuation differences on investments (average of values on 1 Jan. and the end of the reporting period)
Equity/assets ratio (at fair values), % + total equity
valuation differences on investments after deduction of deferred tax x 100 %+ balance sheet total
valuation differences on investments
Risk ratio for P&C Insurance, % + claims incurred – claims settlement expenses x 100 % insurance premiums earned
Cost ratio for P&C Insurance, % + operating expenses + claims settlement expenses x 100 % insurance premiums earned
Loss ratio for P&C Insurance, % claims incurred x 100 % insurance premiums earned
Expense ratio for P&C Insurance, % operating expenses x 100 % insurance premiums earned
Combined ratio for P&C Insurance, % Loss ratio + expense ratio
Expense ratio for life insurance, % + operating expenses before change in deferred acquisition costs + claims settlement expenses x 100 % expense charges
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
20
Per share key figures
Earnings per share profit for the financial period attributable to the parent company’s equity holders adjusted average number of shares
Equity per share equity attributable to the parent company’s equity holders adjusted number of shares at the balance sheet date
Net asset value per share+ equity attributable to the parent company’s equity holders
valuation differences on listed associates in the Group valuation differences after the deduction of deferred taxes
adjusted number of shares at balance sheet date
Market capitalisation number of shares at the balance sheet date x closing share price at the balance sheet date
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
21
Group quarterly comprehensive income statement
Eurm 1–3/2012 10–12/2011 7–9/2011 4–6/2011 1–3/2011
Insurance premiums written 1,845 1,117 985 1,211 1,736
Net income from investments 380 199 -324 119 266
Other operating income 10 8 8 7 8
Claims incurred -939 -984 -897 -908 -934Change in liabilities for insurance and investment contracts -785 141 554 82 -537
Staff costs -153 -136 -133 -132 -141
Other operating expenses -135 -147 -135 -137 -129
Finance costs -29 -41 13 -18 -35
Share of associates' profit/loss 169 164 80 145 152
profit for the period before taxes 363 322 150 369 387
Taxes -47 -43 -25 -60 -62
profit for the period 317 279 125 310 325
Other comprehensive income for the periodExchange differences on translating foreign operations 15 58 -16 -38 2
Available-for-sale financial assets 407 177 -413 -158 -125
Cash flow hedges 0 0 0 0 -1Share of other comprehensive income of associates 18 52 -19 -8 -1
Income tax relating to components of other comprehensive income -103 -42 108 41 33
Other comprehensive income for the period, net of tax 337 245 -341 -163 -93
TOTal COmprEhENSivE iNCOmE fOr ThE pEriOd 654 524 -216 146 232
profit attributable to Owners of the parent 317 279 125 310 325
Non-controlling interests 0 0 0 0 0
Total comprehensive income attributable to Owners of the parent 654 524 -216 146 232
Non-controlling interests 0 0 0 0 0
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
22
Consolidated comprehensive income statement, IFrS
Eurm Note 1–3/2012 1–3/2011
Insurance premiums written 1 1,845 1,736
Net income from investments 2 380 266
Other operating income 10 8
Claims incurred 3 -939 -934Change in liabilities for insurance and investment contracts -785 -537
Staff costs 4 -153 -141
Other operating expenses -135 -129
Finance costs -29 -35
Share of associates' profit/loss 169 152
profit before taxes 363 387
Taxes -47 -62
profit for the period 317 325
Other comprehensive income for the periodExchange differences 15 2
Available-for-sale financial assets 407 -125
Cash flow hedges 0 -1
Share of other comprehensive income of associates 18 -1Income tax relating to components of other comprehensive income -103 33
Other comprehensive income for the period, net of tax 337 -93
TOTal COmprEhENSivE iNCOmE fOr ThE pEriOd 654 232
profit attributable to Owners of the parent 317 325
Non-controlling interests 0 0
Total comprehensive income attributable to Owners of the parent 654 232
Non-controlling interests 0 0
Basic earnings per share (eur) 0.57 0.58
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
23
Consolidated balance sheet, IFrS
Eurm Note 03/2012 12/2011
assetsProperty, plant and equipment 30 26
Investment property 117 118
Intangible assets 5 750 745
Investments in associates 6,551 6,593
Financial assets 6, 7 17,700 16,745
Investments related to unit-linked insurance contracts 8 3,363 3,053
Tax assets 55 64
Reinsurers' share of insurance liabilities 589 532
Other assets 2,240 1,659
Cash and cash equivalents 588 572
Total assets 31,984 30,107
liabilitiesLiabilities for insurance and investment contracts 9 14,376 13,796Liabilities for unit-linked insurance and investment contracts 10 3,350 3,054
Financial liabilities 11 2,754 2,768
Tax liabilities 530 474
Provisions 35 37
Employee benefits 96 98
Other liabilities 1,272 960
Total liabilities 22,413 21,187
Equity
Share capital 98 98
Reserves 1,531 1,531
Retained earnings 7,076 6,844
Other components of equity 867 447
Equity attributable to owners of the parent 9,571 8,920
Non-controlling interests 0 0
Total equity 9,571 8,920
Total equity and liabilities 31,984 30,107
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
24
Statement of changes in equity, IFrS
EurmShare
capital
Sharepremium
accountLegal
reserve
Invested un-
restricted equity
retained earnings
Trans- lation
of foreignoperations
*)
available-for-sale
financial assets **)
Cash flow
hedges ***) Total
Equity at 1 Jan. 2011 98 0 4 1,527 6,459 62 734 3 8,886
Changes in equityShare-based payments 0 0Share of associate’s other changes in equity 1 1
Total comprehensive income for the period 325 0 -92 -1 232
Equity at 31 march 2011 98 0 4 1,527 6,785 63 641 2 9,119
Equity at 1 Jan. 2012 98 0 4 1,527 6,844 91 354 1 8,920
Changes in equityRecognition of undrawn dividends 0
Share of associate's other changes in equity -3 -3
Total comprehensive income for the period 317 24 314 0 654
Equity at 31 march 2012 98 0 4 1,527 7,159 115 668 1 9,571
*) The total comprehensive income includes also the share of the associate Nordea’s other comprehensive income, in accordance with the Group’s share holding. Nordea’s other comprehensive income comprise, to a large extent, the currency hedging of net investments and exchange differences, and therefore the Group’s exchange differences include also Sampo’s share of these items totalling EURm 8 (-1). Available-for-sale financial assets include also the share of Nordea’s valuation differences EURm 9 (-) on these assets.
**) The amount recognised in equity from available-for-sale financial assets for the period totalled EURm 303 (7). The amount transferred to p/l amounted to EURm 1 (-99).
***) The amount recognised in equity from cash flow hedges for the period totalled EURm -0 (-1) .
The amount included in the translation, available-for-sale and cash flow hedge reserves represent other comprehensive income for each component, net of tax.
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
25
Statement of cash flows, IFrS
Eurm 1–3/2012 1–3/2011
Cash and cash equivalent at the beginning of the period 572 527Cash flow from/used in operating activities -399 207
Cash flow from/used in investing activities 220 -6
Cash flow from/used in financing activities 196 8
Increase of liabilities 1,029 754
Decrease of liabilities -833 -746
Cash and cash equivalent at the end of the period 588 736
The cash flow statement reports cash flows during the period classified by operating, investing and financing activities. Cash flows are reported by using the indirect method. Cash flows from operating activities derive primarily from the principal revenue-producing activities. Cash flows from investments in subsidiaries and associated undertakings and those from investments in intangible assets and property, plant and equipment are presented in investing activities. Financing activities include cash flows resulting from changes in equity and borrowings in order to conduct the business. Cash and cash equivalents consist of cash at bank and in hand and short-term deposits (under 3 months).
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
26
Notes
Accounting policies Sampo Group’s consolidated financial statements are prepared in accordance with the International Financial reporting Standards (IFrS) adopted by the Eu. The interim financial statements are presented in accordance with IaS 34 Interim Financial reporting. In preparing the interim financial statements, the same accounting policies and methods of computation are applied as in the financial statements for 2011.
Sampo adopted various new or revised standards and interpretations at the beginning of the year 2012. These standards and interpretations are explained in Sampos accounting policies for the financial year 2011. The financial statements are available on Sampo’s website at www.sampo.com/annualreport.
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
27
Comprehensive income statement by segment for three months ended 31 march 2012
Eurm p&C insurance Life insurance Holding Elimination Group
Insurance premius written 1,591 260 - -5 1,845
Net income from investments 103 271 10 -3 380
Other operating income 9 1 4 -4 10
Claims incurred -736 -203 - - -939Change in liabilities for insurance and investment contracts -525 -266 - 5 -785
Staff costs -138 -11 -4 0 -153
Other operating expenses -119 -17 -4 4 -135
Finance costs -5 -3 -24 3 -29
Share of associates' profit/loss 11 0 158 - 169
profit before taxes 191 33 139 0 363
Taxes -41 -7 0 1 -47
profit for the period 151 26 139 1 317
Other comprehensive income for the periodExchange differences 15 0 - - 15
Available-for-sale financial assets 213 193 1 0 407
Cash flow hedges - 0 - - 0Share of other comprehensive income of associates - - 18 - 18
Income tax relating to components of other comprehensive income -55 -47 0 0 -103
Other comprehensive income for the period, net of tax 173 145 19 0 337
TOTal COmprEhENSivE iNCOmE fOr ThE pEriOd 323 172 158 1 654
profit attributable to Owners of the parent 317
Non-controlling interests 0
Total comprehensive income attributable to Owners of the parent 654
Non-controlling interests 0
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
28
Comprehensive income statement by segment for three months ended 31 march 2011
Eurm p&C insurance Life insurance Holding Elimination Group
Insurance premius written 1,520 216 - - 1,736
Net income from investments 171 96 4 -5 266
Other operating income 9 0 4 -4 8
Claims incurred -712 -222 - - -934Change in liabilities for insurance and investment contracts -517 -19 - - -537
Staff costs -127 -10 -4 0 -141
Other operating expenses -115 -15 -3 4 -129
Finance costs -7 -3 -30 5 -35
Share of associates' profit/loss 0 0 152 - 152
profit before taxes 221 44 122 0 387
Taxes -59 -10 8 0 -62
profit for the period 162 33 130 0 325
Other comprehensive income for the period
Exchange differences 2 0 - - 2
Available-for-sale financial assets -99 -26 0 0 -125
Cash flow hedges - -1 - - -1Share of other comprehensive income of associates - - -1 - -1
Income tax relating to components of other comprehensive income 26 7 0 0 33
Other comprehensive income for the period, net of tax -71 -20 -2 0 -93
TOTal COmprEhENSivE iNCOmE fOr ThE pEriOd 91 13 128 0 232
profit attributable to Owners of the parent 325
Non-controlling interests 0
Total comprehensive income attributable to Owners of the parent 232
Non-controlling interests 0
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
29
Consolidated balance sheet by segment at 31 march 2012
Eurm p&C insurance Life insurance Holding Elimination Group
assetsProperty, plant and equipment 16 6 8 - 30
Investment property 26 91 4 -4 117
Intangible assets 585 165 0 - 750
Investments in associates 348 0 6,203 - 6,551
Financial assets 11,368 5,358 3,654 -2,680 17,700Investments related to unit-linked insurance contracts - 3,368 - -5 3,363
Tax assets 44 - 16 -5 55Reinsurers' share of insurance liabilities 586 3 - - 589
Other assets 1,826 136 294 -16 2,240
Cash and cash equivalents 473 50 65 - 588
Total assets 15,272 9,178 10,244 -2,709 31,984
liabilitiesLiabilities for insurance and investment contracts 10,146 4,229 - - 14,376
Liabilities for unit-linked insurance and investment contracts - 3,355 - -5 3,350
Financial liabilities 401 112 2,549 -308 2,754
Tax liabilities 393 137 - - 530
Provisions 35 - - - 35
Employee benefits 96 - - - 96
Other liabilities 1,005 164 120 -16 1,272
Total liabilities 12,076 7,997 2,669 -329 22,413
EquityShare capital 98
Reserves 1,531
Retained earnings 7,076
Other components of equity 867Equity attributable to owners of the parent 9,571
Non-controlling interests 0
Total equity 9,571
Total equity and liabilities 31,984
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
30
Consolidated balance sheet by segment at 31 December 2011
Eurm p&C insurance Life insurance Holding Elimination Group
assetsProperty, plant and equipment 16 6 4 - 26
Investment property 26 92 4 -4 118
Intangible assets 580 165 0 - 745
Investments in associates 340 0 6,253 - 6,593
Financial assets 10,754 5,168 3,465 -2,642 16,745Investments related to unit-linked insurance contracts - 3,053 - - 3,053
Tax assets 52 - 17 -5 64Reinsurers' share of insurance liabilities 528 3 - - 532
Other assets 1,479 133 59 -12 1,659
Cash and cash equivalents 390 93 89 - 572
Total assets 14,165 8,713 9,891 -2,662 30,107
liabilitiesLiabilities for insurance and investment contracts 9,547 4,249 - - 13,796
Liabilities for unit-linked insurance and investment contracts - 3,054 - - 3,054
Financial liabilities 528 164 2,346 -269 2,768
Tax liabilities 388 85 - - 474
Provisions 37 - - - 37
Employee benefits 98 - - - 98
Other liabilities 695 151 126 -12 960
Total liabilities 11,294 7,703 2,472 -281 21,187
EquityShare capital 98
Reserves 1,531
Retained earnings 6,844
Other components of equity 447Equity attributable to owners of the parent 8,920
Non-controlling interests 0
Total equity 8,920
Total equity and liabilities 30,107
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
31
other notes, Eurm
1 Insurance premiums
P&C insurance 1–3/2012 1–3/2011
premiums from insurance contractsPremiums written, direct insurance 1,662 1,590
Premiums written, assumed reinsurance 38 28
premiums written, gross 1,701 1,618Ceded reinsurance premiums written -110 -98
p&C insurance, total 1,591 1,520
Change in unearned premium provision -582 -563
Reinsurers' share 57 46
premiums earned for p&C insurance, total 1,066 1,003
Life insurance 1–3/2012 1–3/2011
premiums from insurance contractsPremiums from contracts with discretionary participation feature 48 44
Premiums from unit-linked contracts 91 85
Premiums from other contracts 0 0
insurance contracts, total 140 129Assumed reinsurance 0 0
premiums from investment contractsPremiums from contracts with discretionary participation feature 0 1
Premiums from unit-linked contracts 122 91
investment contracts, total 123 91Reinsurers' shares -3 -4
life insurance, total 260 216
Single and regular premiums from direct insuranceRegular premiums, insurance contracts 105 91
Single premiums, insurance contracts 35 37
Single premiums, investment contracts 123 91
Total 263 220
Elimination items between segments -5 -
Group, total 1,845 1,736
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
32
P&C insurance 1–3/2012 1–3/2011
financial assetsDerivative financial instruments 1 1
Financial assets designated as at fair value through p/l
Debt securities 3 1
Equity securities 0 0
Total 3 1
Loans and receivables 5 6
Financial asset available-for-sale
Debt securities 104 98
Equity securities 8 86
Total 112 184
Total financial assets 121 192
Income from other assets 0 0
Fee and commission expense -3 -2
Expense on other than financial liabilities -1 -4
Effect of discounting annuities -15 -15
p&C insurance, total 103 171
2 Net income from investments >
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
33
Life insurance 1–3/2012 1–3/2011
financial assetsDerivative financial instruments 9 28
Financial assets designated as at fair value through p/l
Debt securities 1 2
Equity securities 0 0
Total 1 2
Investments related to unit-linked contracts
Debt securities 21 -5
Equity securities 163 -18
Loans and receivables 0 0
Other financial assets 1 4
Total 185 -19
Loans and receivables -7 -1
Financial asset available-for-sale
Debt securities 34 19
Equity securities 45 63
Total 80 82
Total income from financial assets 268 92
Other assets 2 1
Fee and commission income, net 2 3
life insurance, total 271 96
> 2 Net income from investments >
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
34
Holding 1–3/2012 1–3/2011
financial assetsDerivative financial instruments 2 1
Loans and other receivables 0 -1
Financial assets available-for-sale
Debt securities 7 3
Equity securities 1 1
Total 8 4
Other assets 0 0
Fee income, net 0 0
holding, total 10 4
Elimination items between segments -3 -5
Group, total 380 266
> 2 Net income from investments
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
35
P&C insurance 1–3/2012 1–3/2011
Claims paid -819 -732
Reinsurers' share 32 61
Claims paid, net -787 -671Change in provision for claims outstanding 53 5
Reinsurers' share -2 -46
p&C insurance total -736 -712
Life insurance 1–3/2012 1–3/2011
Claims paid -191 -203
Reinsurers' share 3 3
Claims paid, net -188 -200Change in provision for claims outstanding -16 -22
Reinsurers' share 0 0
life insurance, total -203 -222
Group, total -939 -934
3 Claims incurred
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
36
P&C insurance 1–3/2012 1–3/2011
Wages and salaries -95 -89
Granted cash-settled share options -4 -4
Pension costs -18 -16
Other social security costs -20 -19
p&C insurance, total -138 -127
Life insurance 1–3/2012 1–3/2011
Wages and salaries -8 -7
Granted cash-settled share options -1 -1
Pension costs -1 -1
Other social security costs -1 -1
life insurance, total -11 -10
Holding 1–3/2012 1–3/2011
Wages and salaries -2 -2
Granted cash-settled share options -2 -2
Pension costs 0 0
Other social security costs 0 0
holding, total -4 -4
Group, total -153 -141
4 Staff costs
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
37
P&C insurance 3/2012 12/2011
Goodwill 568 564
Other intangible assets 18 17
p&C insurance, total 585 580
Life insurance 3/2012 12/2011
Goodwill 153 153
Other intangible assets 12 12
life insurance, total 165 165
Holding 3/2012 12/2011
Other intangible assets 0 0
Group, total 750 745
5 Intangible assets
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
38
P&C insurance 3/2012 12/2011
Derivative financial instruments (Note 7) 59 114
Financial assets designated as at fair value through p/l
Debt securities 157 155
Equity securities 2 2
Total 158 157
Loans and receivables
Loans 82 82
Deposits with ceding undertakings 1 1
Total 83 83
Financial assets available-for-sale
Debt securities 9,637 9,113
Equity securities 1,431 1,287
Total 11,068 10,400
p&C insurance, total 11,368 10,754
Life insurance 3/2012 12/2011
Derivative financial instruments (Note 7) 60 36
Financial assets designated as at fair value through p/l
Debt securities 47 50
Equity securities 1 1
Total 49 51
Loans and receivables
Loans 21 22
Deposits with ceding undertakings 1 1
Total 22 23
Financial assets available-for-sale
Debt securities 2,909 2,832
Equity securities *) 2,318 2,226
Total 5,227 5,058
life insurance, total 5,358 5,168
*) of which investments in interest funds 36 39
6 Financial assets >
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
39
Holding 3/2012 12/2011
Derivative financial instruments (Note 7) 34 29
Loans and receivables
Deposits 1 1
Financial assets available-for-sale
Debt securities 1,213 1,032
Equity securities 37 34
Total 1,250 1,066
Investments in subsidiaries 2,370 2,370
holding, total 3,654 3,465
Elimination items between segments -2,680 -2,642
Group, total 17,700 16,745
> 6 Financial assets
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
40
7 Derivative financial instruments
P&C insurance 03/2012 12/2011
fair value fair value fair value fair valueContract/
notional amount
Assets LiabilitiesContract/
notional amount
Assets Liabilities
derivatives held for tradingInterest rate derivatives 163 2 1 555 19 16
Foreign exchange derivatives 5,482 56 75 11,961 95 186
Equity derivatives 0 0 0 0 0 -
Total 5,645 58 76 12,516 114 202
derivatives held for hedgingFair value hedges 300 0 - 277 0 0
p&C insurance, total 5,945 59 76 12,793 114 202
Life insurance 03/2012 12/2011
fair value fair value fair value fair valueContract/
notional amount
Assets LiabilitiesContract/
notional amount
Assets Liabilities
derivatives held for tradingInterest rate derivatives 3,124 33 2 2,308 31 0
Foreign exchange derivatives 1,162 7 10 912 3 25
Equity derivatives 2 0 0 29 0 0
Total 4,288 40 12 3,219 34 25
derivatives held for hedgingCash flow hedges 47 1 0 47 2 -
Fair value hedges 512 18 0 463 0 38
Total 559 20 0 510 2 38
life insurance, total 4,847 60 12 3,729 36 64
Holding 03/2012 12/2011
fair value fair value fair value fair valueContract/
notional amount
Assets LiabilitiesContract/
notional amount
Assets Liabilities
derivatives held for tradingInterest rate derivatives 1,550 20 - 1,050 16 -
Credit risk derivatives 20 1 - 20 0 -
Equity derivatives 80 13 16 80 13 17
Total 1,650 34 16 1,150 29 17
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
41
8 Investments related to unit-linked insurance
Life insurance 03/2012 12/2011
financial assets as at fair value through p/lDebt securities 624 570
Equity securities 2,451 2,190
Loans and receivables 283 293
Derivatives 10 1
life insurance, total 3,368 3,053
Elimination items between segments -5 -
Group, total 3,363 3,053
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
42
9 Liabilities for insurance and investment contracts >
P&C insurance 03/2012 12/2011
insurance contractsProvision for unearned premiums 2,573 1,972
Provision for claims outstanding 7,574 7,576
p&C insurance, total 10,146 9,547
reinsurers' shareProvision for unearned premiums 110 53
Provision for claims outstanding 476 476
p&C insurance, total 586 528
Life insurance 03/2012 12/2011
Liabilities for contracts with DpF
provision for unearned premiums 2,181 2,219
provision for claims outstanding 2,039 2,020
Total 4,220 4,239
Liabilities for contracts without DpF
provision for unearned premiums 0 0
provision for claims outstanding 1 0
Total 1 1
Total 4,221 4,240
assumed reinsurance
provision for unearned premiums 1 1
provision for claims outstanding 1 1
Total 2 2
insurance contracts, totalprovision for unearned premiums 2,182 2,220
provision for claims outstanding 2,041 2,022
Total 4,223 4,242
investment contractsLiabilities for contracts with DpF
provision for unearned premiums 6 7
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
43
> 9 Liabilities for insurance and investment contracts
liabilities for insurance and investment contracts, totalprovision for unearned premiums 2,189 2,227
provision for claims outstanding 2,041 2,022
life insurance, total 4,229 4,249
recoverable from reinsurersprovision for unearned premiums 0 0
provision for claims outstanding 3 3
life insurance, total 3 3
Investment contracts do not include a provision for claims outstanding.
Liability adequacy test does not give rise to supplementary claims.
Exemption allowed in IFrS 4 Insurance contracts has been applied to investment contracts with DpF or contracts with a right to trade-off for an investment contract with DpF.These investment contracts have been valued like insurance contracts.
Group, total 14,376 13,796
10 Liabilities from unit-linked insurance and investment contracts
Life insurance 03/2012 12/2011
Unit-linked insurance contracts 2,395 2,216
Unit-linked investment contracts 960 838
life insurance, total 3,355 3,054
Elimination items between segments -5 -
Group, total 3,350 3,054
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
44
11 Financial liabilities
P&C insurance 03/2012 12/2011
Derivative financial instruments (Note 7) 76 202
Subordinated debt securitiesSubordinated loans 325 326
p&C insurance, total 401 528
Life insurance 03/2012 12/2011
Derivative financial instruments (Note 7) 12 64
Subordinated debt securitiesSubordinated loans 100 100
life insurance, total 112 164
Holding 03/2012 12/2011
Derivative financial instruments (Note 7) 16 17
debt securities in issueCommercial papers 601 652
Bonds 1,932 1,677
Total 2,533 2,329
holding, total 2,549 2,346
Elimination items between segments -308 -269
Group, total 2,754 2,768
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
45
12 Contingent liabilities and commitments >
P&C insurance P&C insurance 03/2012 12/2011
Off-balance sheet itemsGuarantees 41 43
Other irrevocable commitments 11 11
Total 52 54
assets pledged as collateral for liabilities or contingent liabilities
3/2012 3/2012 12/2011 12/2011
assets pledged as collateralAssets
pledgedLiabilities/
commitmentsAssets
pledgedLiabilities/
commitments
Cash at balances at central banks 10 8 10 8
Investments
- Investment securities 147 111 142 114
Total 157 118 152 122
Non-cancellable operating leases 03/2012 12/2011
Minimum lease payments
- not later than one year 39 41- later than one year and not later than five years 111 105
- later than five years 117 120
Total 267 266
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
46
> 12 Contingent liabilities and commitments
Life insurance P&C insurance 03/2012 12/2011
Off-balance sheet itemsFund commitments 340 309
Other commitmentsAcquisition of IT-software 1 1
Non-cancellable operating leases minimum lease payments - not later than one year 2 2
- later than one year and not later than five years 4 5
Total 6 7
Holding P&C insurance 03/2012 12/2011
Off-balance sheet itemsFund commitments 1 1
Non-cancellable operating leases minimum lease payments - not later than one year 1 1
- later than one year and not later than five years 3 3
- later than five years 0 0
Total 5 5
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
47
13 result analysis of p&C insurance business
P&C insurance 1-3/2012 1-3/2011
Premiums earned 1,066 1,003
Claims incurred -805 -777
Operating expenses -181 -170
Other technical income and expenses 2 2
Allocated investment return transferred from the non-technical account 29 42
Technical result 112 100Investment result 113 178
Allocated investment return transferred to the technical account -44 -57
Other income and expenses 11 0
Operating result 191 221
Sampo Group Interim report Q1/2012 TaBlES 31 marCh 2012
48
14 Sampo plc’s income statement and balance sheet (FaS)
Income statement rance 1-3/2012 1-3/2011
Other operating income 4 4
Staff expenses -4 -4
Depreciation and impairment 0 0
Other operating expenses -4 -3
Operating profit -4 -3Finance income and expenses 209 223
profit before appropriations and income taxes 205 220Income taxes 0 8
profit for the financial period 205 228
Balance sheet 3/2012 12/2011
aSSETSNon-current assets
Intangible assets 1 1
Property, plant and equipment 4 4
Investments
Shares in Group companies 2,370 2,370
Receivables from Group companies 217 223
Shares in participating undertakings 5,557 5,557
Receivables from participating undertakings 328 325
Other shares and participations 41 38
Other receivables 667 484
Receivables 348 104
Cash and cash equivalents 65 89
TOTal aSSETS 9,599 9,195
liaBiliTiESEquityShare capital 98 98
Fair value reserve 2 2
Invested unrestricted equity 1,527 1,527
Other reserves 273 273
Retained earnings 4,824 4,142
Profit for the year 205 682
Total equity 6,929 6,724
liabilitiesLong-term 1,932 1,677
Short-term 738 795
Total liabilities 2,670 2,472
TOTal liaBiliTiES 9,599 9,195
Q1Sampo plc Fabianinkatu 2700100 Helsinki, FinlandTelephone +358 (0)10 516 0100Fax +358 (0)9 228 90 434 or +358 (0)10 516 0016
www.sampo.com