Triglav expects EBT in the range of EUR 100 – 120m in FY 2024.
Triglav Group published its business plan for 2024 according to which they expect the following:
- GWPs: c. EUR 1.6bn
- EBT: EUR 100 – 120m
- Combined ratio: ~ 95%
Given the 9M 2023 results under the impact of CAT claims in Q3 along with the termination of supplemental health (our company note is available to research subscribers), the company also revised their FY 2023 EBT target. Revised EBT stands at around 80% lower than originally planned (the plan was EUR 95 – 110m) under the assumption of normal further claims development in Q4. CAT claims were the most important topic of Q3 results. As anticipated CAT events materialized in this quarter, impacting the Group by EUR 55.1m after taking the reinsurance protection into account, due to the flood, storms, and hails in Slovenia and the region. However, even taking those negative impacts from CAT & government regulation, it should be noted that in 9M 2023, Triglav Group recorded a 12% YoY increase in total business volume, reaching EUR 1.39bn due to price increases and increased business volume. Total business volume is a “new” reporting item, representing values from GWPs, coinsurance, and reinsurance premiums along with other insurance income. The total business volume became another new “top-line” measure as the Group stated and is not a reported item in the P&L, but rather a derived number for an investor to have a sense of development.
Revised Strategy to 2024:
The Group expects a moderate macroeconomic environment in 2024 overall. However, Triglav emphasized that its performance will depend on the termination of supplemental health insurance, reinsurance coverage and the market potential of the region. In other words, the total impact of the termination of supplemental health insurance and reinsurance coverage remains to be seen.
The Group’s total business volume is planned at c. EUR 1.6bn and EBT between EUR 100 – 120m. The Group will aim to ensure a high level of profitability with a target combined ratio of around 95% in non-life & health insurance. Finally, the Group emphasized its dividend policy remains unchanged. Further, by continuing its digital transformation and developing service-oriented business ecosystems, the Group will continue to pursue its main strategic objective – client experience. Finally, long-term this sector should appear appealing due to positive investment results as expectations for interest rates are for rates to be elevated for a longer time period. Triglav has already seen a positive impact from investment result in 9M 2023, so far.