Sava Re publishes 2024 estimates along with the 2025 Business plan: Business volume growth of >5%, net profit over EUR 84m, consequently ROE >11% with stable solvency ratio and CoR at below 94%.
Sava Re publishes 2024 estimates that we deem achievable. As of now, 2024 represents the second year of implementation of Sava Re’s 2023-2027 strategy. Group expects EBT at EUR 100m, while for net profit to amount to EUR 78m, which would represent over 20% YoY growth, and also stand 10% above the Group’s target for this year.
The company’s management estimates that this year’s top line would pass the EUR 1bn mark (FY 2023 910m), which we deem realistic as Business volume for 9M 2024 currently stands at EUR 815m (Q3: EUR 250m). Taking a look at 9M results so far, the Group’s top line has noted an increase of app. 15%, reflecting both higher prices and more policies sold. Non-life was primarily driven by the motor business, while Life improved mainly on the volume. Consequently, insurance service result improved both due to a combination of higher revenue and favorable claims experience & low base effect. Looking solely at Q3, ins. service result amounted to EUR 19.6m, vs. a loss of EUR 3.9m in the comparable period. This occurred as Q3 in the previous year was highly influenced by CAT events, as during summer, the region was affected by floods and storms – resulting in unusually high claims. At the time, gross claims reached more than EUR 100m, but due to reinsurance protection net impact was limited to app. EUR 30m.
2022 & 2023 Results, FY2024 estimates and 2025 Business plan
Source: Sava Re, InterCapital Research
2025 Business plan
Business volume (top line) growth of >5%, net profit over EUR 84m, consequently ROE >11% with, as always, stable solvency ratio in the upper band of 170% – 210% and Combined ratio below 9%. The top line is mainly expected to be driven by Non-life in the EU markets by enhanced coverage for existing customers and the acquisition of new customers. Also, the Group does see significant potential in the non-EU markets (expected growth of >8%) due to strong organic growth. Finally, the Group will continue to focus on automating and digitizing customer communications.
Overall, one can notice this year’s development on LJSE has been favorable for Slovenian insurers (both Sava Re and Triglav) with Sava Re outperforming SBITOP’s performance by as much as 10 p.p.
Sava Re vs. SBITOP development [YTD, %]
Source: Bloomberg, InterCapital Research
