Alm Brand A/S

Hello, everyone, and thank you for joining us today for the on-brand Q4 2025 results call. My name is Sami, and I'll be coordinating your call today. During the presentation, you can register a question by pressing star followed by 1 on your telephone keypad. To change your mind, please press star followed by 2 on your telephone keypad to remove yourself from the question queue. I'll now hand over to your host, Rasmus Werner-Nielsen, CEO to begin. Please go ahead, Rasmus.

Thank you. Good morning, and thank you for joining us on our conference call. As usual, I have with me today our CFO, Andreas Ruben Madsen, and the head of our IR team, Mads Tinko. This morning, we published our interim report for the fourth quarter, and as usual, I will walk you through the operating highlights, and then Andreas will comment on the financials. Let us move to slide two. Overall, 2025 ended better than expected with an insurance service result of 1.91 billion, significantly up from 1.44 billion last year. Last claims of 5.2% and weather-related claims of 3.2% in 2025 were both below the new normal levels we expect, while the undiscounted underlying loss ratio improved by 3.1% compared to 2024, driven by our repricing and synergies. We had a strong growth of 9.7% in our personal lines in 2025, while also ending the year with a quarterly growth rate of almost 10%. Thanks to our strong partnership with local banks as well as countrywide banks, we are taking market shares in personal lines. We view growth in commercial lines as decent in 2025 with just below 3%. On the cost side, we improved the cost percentage to 17% in 2025 as planned. This is a satisfactory 1.3 percentage point reduction from 2024. Combined with the very satisfactory investment result for 2025 of above $0.3 billion, the profit before special cost and tax reached $2.12 billion. A proposed dividend of 0.66 crowns per share and total ordinary buybacks of $500 million represent a record high normal distribution of a total of $1.4 billion and a payout ratio of 98% for 2025. This is on top of the one billion extraordinary buyback we expect to do in 2026 related to the approval of our PIP model, as well as an extraordinary steady increase in our CSR coverage in Q4. Now I turn to slide three with our highlights for Q4. Q4 was supported by an improvement in the underlying undiscounted claims ratio of three percentage points related to our repricing and harvesting of synergies. Synergies also supported a further drop in our cost ratio. As mentioned on the slide before, growth in personal lines was strong at almost 10% year-on-year in Q4, while growth in commercial lines was a bit negative due to the built-in volatility in repricing our largest corporate customers. Furthermore, a technicality in Q4 last year gave a small headwind for the quarter as well. Please turn to slide four with our financial highlights for Q4. The insurance service result for Q4, $25 or $521 million, was an improvement for $440 million last year, mainly driven by lower underlying claims, but also with support from the strong growth in personal lines. The investment result of $73 million in Q4 was satisfactory, and on par with last year, and we entered 2025 at a very satisfactory level for the investment result of 337 million. Special cost of 39 million is somewhat lower than last year due to lower cost for the integration of coding and realization of synergy, as well as special cost for announced redundancies booked in Q4 last year. On slide five, you can see the payout ratio and Fs for 2025. The payout ratio was 98, and earnings per share ended at one Danish crown. The payout ratio is achieved as the net profit after tax, with some adjustment related to the cooling integration, amortization of intangible assets, and profit of the discontinued activities from energy and marine business. In 2025, we are close to 100% payout, as we have been in all recent years. This reflects our strong underlying capacity for distribution. Earnings per share came to one daily ground for 2025 based on adjusted profit after tax and the average number of shares. This serves as the baseline for the 2026 to 2028 EFS cargo target of 10%. So adding together the upcoming share buyback program of 1.5 billion and the dividend of 0.66 crowns to be paid in April, we expect to make a total of 2.4 billion in distributions in 2026. Let's go into the details with the insurance service results on segments on slide 7. Personal lines increased the insurance service results significantly to 314 million in Q4, The improvement in personal line was driven by double-digit premium growth, two percentage point improvement in the underlying undiscounted claims ratio, and higher runoff gains than the year before. The drop in the cost ratio followed the plan and thus helped as well. Commercial lines did a bit under last year with an insurance service result of $207 million compared to $238 million in Q4 last year. The main driver for the low result was major claims doubling to 8% in commercial lines, although this is still below the normal level in commercial lines of around 10%. In addition, commercial lines were impacted negatively by a runoff loss of 2.8%, primarily related to liability insurance. We are, however, very satisfied with a massive improvement in the undiscounted underlying claims in commercial lines this quarter. And now please turn to slide eight. Insurance revenue grew by 4.6% in the quarter thanks to continued strong growth in personal lines of almost 10%. In personal lines, we are still taking market shares due to our strong bank partnerships while repricing related to high motor claims help as well. The last effect is expected to dissipate in the coming quarters. Commercial lines are switching to negative premium growth in the quarter But the growth is slightly positive when adjusting for technicality in Q4 last year that carries a headwind of 1% to commercial lines growth in this quarter. Our work with increasing profitability of our largest customers does lead to some volatility from quarter to quarter in commercial lines depending on the acceptance of individual price increases. Q4 this year, premium growth was impacted negatively by this. And moving on to slide 9 and the claims ratio. The Q4 claims ratio was down 1.2 percentage point year-on-year, mostly due to a drop in underlying claims of 2.4 percentage points, while it was negatively impacted by the runoff loss in Q4. The 2.4 percentage point improvement in the underlying claims ratio was driven by repricing and harvested sanity gains while discounting was less of a help in Q4 this year due to a one-off, which led to a temporary 0.6 percentage point drop in the overall help from discounting in this quarter. On an undiscounted basis, the underlying loss ratio improved by three percentage points The personal lines had an improvement of about 2.1 percentage point, while the improvement in commercial lines reached 3.7 percentage point. And now please turn to slide 10 and the personal lines. The CAIMS ratio is down a massive 5 percentage point, driven by underlying improvements and higher runoff gains compared to last year. On top of this, the cost ratio still improves. quarter is reduced with 7.7 percentage points to 18.9%. Please turn to slide 11 and the commercial lines. The total claims experience worsened in commercial lines, which was driven by an increase in major claims to 8% compared to a very low level of just 4% last year. However, I know that this year is still below the normal level of 10%. An atypical runoff loss of 2.8 percentage points in commercial lines was also a factor behind an increase in the claims ratio of about 3 percentage points. However, I'm still very pleased with the undiscounted underlying claims in commercial lines improving 3.7 percentage points year-on-year. Our expense ratio in commercial lines in Q4 improved by And with these comments, I will now hand over the work to Andreas, who will walk us through the financials.

Thank you, Rasmus. Now please turn to slide 13 for a final update on our synergies. Synergies in Q4-25 of 164 million is up by 26 million compared to Q4 last year, and thus we end 25 with 618 million in realized synergies. This underlines our successful takeover of Kodam, as this is above the target of 600 million per year. We actually finished the synergy program with a run rate of 650 million by the end of 2025, just to highlight how much we have won by acquiring Kodam. The improvement in harvested synergies in Q4 2025 of 26 million from 138 million in Q4 24 implies an improvement in our underlying claims ratio of 0.5 percentage points and our cost ratio by 0.4 percentage points year on year. This will be the ending of our CNT accounting. And now I move to slide 14 and the investment result. The investment result was a profit of 73 million given by a positive return from our free portfolio and a positive return from our match portfolio as well. Overall, I'm quite pleased with the investment result for 2025 of 337 million, which ended well above the 200 million guidance we started with at the beginning of the year. Even though we focus much more on the insurance service result than the investment result, it is clear that a positive investment outcome like the one we had in 2025 is a nice add-on to our distributions for the year. And now finally, please turn to slide 16 for the Outlook 425, initially stated January 21st. Our guidance includes a technical result excluding one-offs of 1.65 to 1.85 billion. The guidance reflects positive effects from our new strategy initiatives presented at the CMD in November last year. The cost ratio is expected to be unchanged at 17% in 26, and the combined ratio excluding one-offs result is expected to be 84.5 to 86.5. We expect an investment result of 200 million in 26, based on the current returns for the free portfolio and a zero result for the match portfolio. Consequently, group profit excluding other income and expenses is expected to be 1.85 to 2.05 billion before tax, excluding runoff gains for 26. As you may have noticed, this is a bit different from how we used to guide. We're now limiting ourselves to just one line with other income and expenses consisting of group costs, spend for education and development, and amortization of intangible assets. We guide at 0.5 billion net expenses for this single line below the line in 2026. And with this, I conclude our presentation and hand over the word to our moderator. Thank you.