Alm Brand A/S

Hello, everyone. Thank you for joining us and welcome to the AlmBrand second quarter 2026 earnings call. After today's prepared remarks, we will host a question and answer session. If you'd like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. I will now hand the conference over to Andreas Ruben Madsen, CEO at AlmBrand. Please go ahead.

Good morning. Thank you for joining us on our conference call. I'm Andreas Ruben Madsen, CEO of Anminni Brand Group. As usual, I have with me the head of our RR team, Mads Thinggaard. This morning, we published our interim report for the second quarter of 26. Now I'll walk through the presentation of our results. Let's now turn to slide two and the key highlights for my first full quarter as CEO. Overall, I'm very pleased with the financial performance in Q2. We delivered a strong underlying improvement in the claims ratio, which improved by 200 basis points year-on-year. At the same time, results in Q2 were negatively impacted by a 700 million one-off reserve strengthening following the Supreme Court ruling on workers' compensation. In personal lines, growth slowed a bit in the quarter as expected due to the year-on-year effects from last year's repricing fading. However, a growth rate of above 5% during Q2 still indicates that we continue to gain market shares. In commercial lines, we experienced a decline in the top line, reflecting our actions to improve profitability in an increasingly soft market for workers' compensation while seeking to reduce volatility at the same time. Adjusted for the areas we work on in this respect, which is workers' compensation and industrial customers, the commercial portfolio reflected a premium growth of 1.0% year on year. Importantly, we improved the underlying claims ratio in commercial lines by 2.3 percentage points year on year. So overall, this reflects continued progress on profitability. And now I'd like you to turn to slide three for our financial highlights. In the table to the right, the middle column reflects our Q2 financials excluding the impact from the Supreme Court ruling on workers' compensation. Insurance revenue grew to 3.0 billion in the quarter. The adjusted insurance service result was 648 million, up from 520 million in Q2 last year. And this represents our highest insurance service result ever. We continue the strong underlying trend from Q1 with a significant year-on-year improvement in underlying claims. Weather related claims were higher than we would normally expect for Q2, while major claims were below normal levels. Runoff gains at a level of around 3.5 percentage points were almost double of the normally expected level. Investment income was strong in Q2 with a net gain of 215 million, related to the rebound in the market impacting equities as well as bonds in a positive direction. Finally, other income and expenses are significantly lower than last year. Primarily, we no longer have integration costs related to Kodan following the completion of the integration. And now let's turn to slide five. As I mentioned before, the group delivered the highest insurance service result ever in Q2, adjusted for the Supreme Court ruling on workers' compensation. A significant improvement was driven by strong underlying improvements as well as runoff gains when adjusting for the one-off charge. In personal lines, the insurance service result increased year-on-year by 114 million to 400 million. This was driven by continued growth, underlying improvements and runoff gains. The cost ratio increased marginally to 17.2%. In commercial lines, the adjusted insurance service result was 248 million up from 234 million last year. The increase was driven by a combination of significant underlying improvements, higher ordinary runoff gains than Q2 last year, and a 30 basis points drop in the cost ratio. On the other hand, weather claims and major claims were above the level in Q2 last year, while the decline in premiums had only a limited impact on earnings. Please turn to slide six. Insurance revenue grew by 1.7% in the quarter compared to 2.5% last quarter, reflecting effects from last year's repricing fading and an increasingly soft market for workers' compensation. In personal lines, we continue to take market share while the effects of repricing are fading as expected. Therefore, I am quite pleased that we delivered a growth rate of 5.2% year-on-year. In commercial lines, premiums declined by 2.3%. This points year and year, reflecting our continued efforts with improving profitability in the soft market for workers' compensation, as well as reducing volatility among our larger customers. Adjusted for workers' compensation and industrial customers, the commercial portfolio grew at a muted level of 1.0% in Q2. The growth of 1% in the broad commercial book is too low in my view. It calls for a bit of management attention, especially on the SME side. And now moving to slide seven and the claims ratio. The Q2 claims ratio improved by nearly four percentage points year and year, adjusted for the Supreme Court ruling. This reflects strong underlying improvements and relatively high ordinary runoff gains, partly offset by elevated weather claims following the storm Dave in April. In addition, the year-on-year comparison benefited from the non-recurrence of reinstatement premiums recognized in Q2 2025. The underlying claims ratio was 200 basis points lower year-on-year, driven by our profitability initiatives. The underlying improvements were particularly strong in commercial lines, with 230 basis points improvements in underlying claims year-on-year, while personal lines improved by 190 basis points. Overall, the discounting effect as flat year-on-year at 2.2 percentage points, which may come as a surprise to some of you. This reflects model changes within workers' compensation that offset the positive impact from the higher interest rates in Q2 this year compared to last year. Looking ahead, I would expect the discounting to be at a level of about 2.2% with the current level of interest rates. And now, please turn to slide eight. The combined ratio in personal lines improved to 75.5% from 81.6% last year. This was driven by lower underlying claims and runoff gains. On the other side, the cost ratio increased slightly to 17.2% in Q2. Premium growth remained strong at 5.2% despite the fading effects from repricing. Please turn to slide 9 for commercial lines. In commercial lines, we observed a reduction in the combined ratio to 81.8% in Q2 26 adjusted for the Supreme Court ruling compared to 83.2% in Q2 last year. The improvement was driven by significant improved underlying claims and the reinstatement fee for reinsurance in Q2 25 not being repeated. This was partly offset by somewhat higher large and weather related claims, while the cost ratio decreased by 30 basis points in a year, providing additional support. Now let's move to slide 11 and the investment result. You may have noticed that we began disclosing returns on our free portfolio in Q1 this year. This was in response to requests from many of you. In Q2, the investment result was a gain of 250 million, primarily driven by the free portfolio, which contributed 209 million, especially with equities benefiting from the general rebound in the market following the geopolitical turmoil experienced during Q1. Let me also briefly touch on the tier two issuance in June. We issued 900 million tier two bonds at a spread of 140 basis points, slightly below the spread on the maturing tier two, the part not already tendered, 366 million will have first call in October this year. Finally, let's turn to slide 13 and our updated guidance. We're revising our guidance for the insurance service result in 26 upwards by 100 million to 1.2 to 1.4 billion, excluding runoff gains in second half of 26. This reflects the strong underlying performance in Q2 as well as one-off gains. Looking ahead, we continue to expect one-off gains of around 2%. The new guidance corresponds to 1.9 to 2.1 in insurance service result adjusted for the 700 million one-off charge related to the Supreme Court ruling on workers' compensation. We continue to expect a cost ratio of around 17% for 26. The combined ratio excluding the runoff result in H2 is expected to be 88 to 90, corresponding to 82.5 to 84.5 when adjusted for the impact of the Supreme Court ruling and improvement of 100 basis points, following the strong result we had in Q2. As a result, guidance for profit before other income and expenses is upgraded by 200 million to 1.45 to 1.65 billion, or 2.15 to 2.35 billion adjusted for the Supreme Court ruling. Other income and expenses remain unchanged and guided at an expense of 0.5 billion for 26. And with this, I conclude our presentation and hand over the word to our moderator. Thank you.

Thank you. We will now begin the question and answer session. Please limit yourself to a couple of questions. If you'd like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. We ask that you pick up your handset when asking your question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Matthias Nielsen with Nordea. Your line is open.

Thanks a lot and congratulations on the strong development in the online claims ratio this quarter. So my question is a bit about how we should think about that in the coming quarters and also in the context of your 28 targets. It seems like you're quite off to a strong start. How do you think about stochasticity and other things with the development you have made both in Q1 and Q2 now on this? So maybe a few comments on that for the coming quarters, and then we can take my second questions after that.

Yeah, thank you, Mathias. I can give some flavor to that. There are a bit of different nuances going through Private, personal lines and commercial lines separately. But if you want sort of the very big picture, we have some slight pricing overhang to name one thing. We have also a very slight synergy overhang also remaining. Then we also have some support from reassurance, as we have talked about before. being highest in commercial lines, but around 0.5 or so on average for the group percent. So if you sort of total that up, that adds up to around a percentage point or so, plus minus. And then we have around a percentage points, which I would also consider to some degree, it's a stochastic this quarter of improvements, which mainly are related to property related lines, actually both in our commercial and private lines book. So if we look at that going forward, the guidance we started for the year on this point actually stands. We have a base expectation of around, let's say, 100 basis points improvements in the coming quarters. All else equal, that would be, if that holds, then that would come to around 1.5 percentage points for the full year. So that's sort of the rough guidance for that.

OK, so around 100 basis points for the coming quarters. Fading off to like bigger in Q3 than Q4, is that how we should expect it as pricing table is fading or is that already?

I think the composition will be different because we've had, as I talked about, a slight repricing, we've had some synergies still, but that will fade and disappear completely. and then what we'll get in the other hand will be the first parts of our strategic initiative coming through and to name the main ones coming would be one is the consolidation of our data centers which we have just implemented Then we have the work we're doing within our claims area with what we call smart repairs related to the motor area. And then the final one, procurement, especially within buildings for the claims area. Those three would add up to something like, let's say, 15 million. 15 million per quarter roughly evenly divided between the three. So that will sort of start ticking in as the synergy and prices overhang go out, thereby getting back to the approximately one percentage points in total.

Okay, that was very clear. Then my second question is, You almost sound quite bearish on the conversion line growth, but if you look on the Q&Q basis, you're up 2.2%. Is that the pace that you should expect in the coming quarters? The 1st of January, we knew that's kind of behind us. That was soft, but that's how it is, and we know that already. But when you look on the Q&Q basis, the growth is actually quite fine. Is that also how we should expect it to be in Q3 and Q4, that the QMQ growth is holding up quite well? How should we think about that?

I think the growth, the vicinity of the growth we're seeing now is more or less, I think, a good starting point for what we would expect. also in the coming year as a year-on-year growth of around a total decrease of just above 2%, I think is a good starting point for the expectations also in the coming quarters. We do have some of the commercial book renewing 110, but I think it will take, we'll have to go into the next year for us to really see a different trend in the total commercial lines premiums.

Perfect, that was very clear. Thanks a lot.

Your next question comes from the line of Osborne Mark with Donka Bank.

Your line is open. Good morning. Thanks for taking my question as well. It's actually a bit of a follow up from previous questions back on your guidance for the full year, just trying to understand the journey that we've been on. So we got the Q1 numbers. You raised the guidance to 150 million. Obviously, some of it was realized runoff gains, but still. Then we had, on the same day, the adjustment on the back of the workers' compensation case. That was a full 700, clean cut. And then today, looking at the underlying trends that you print, both for Q1 and Q2, you're lifting your guidance by 100 million, essentially the runoff gains. And I do hear what you say in terms of the stochastic elements in, I guess, both Q1 and Q2. But still, to me, it seems like there is also an underlying improvement within those 200 basis points that wouldn't explain the full difference from 100 basis points to 200 basis points. Just really trying to understand. I know there's a rounding element as well in your guidance. But still, just trying to understand if you see this purely as stochastic or if there is some sort of underlying still improving more than you expected also with the communication that you had. And I guess going forward, the improvement into next year, now that we are ahead of the plan for this year, how should we look at that improvement as a starting point is a more ambitious one, so to speak.

Yeah, well, let me start going through the current year to begin with. I think, I mean, as we also stated, it has to do with two things, as you also say. In sort of very rough sort of numbers, we have some moving parts with large claims a bit below normal. We have weather claims a bit above. So things are sort of moving around. The main things driving the upgrade would be our underlying loss ratio and the major one being our adjusted, so to say, prior year gains. And I think if you look at it mechanically, also giving what I'm saying around a base expectation of around 100 basis points in the underlying cost ratio, maybe having, let's say, just below that in a stochastic element. If you add up the math, you might you could do the argument that 100 is maybe slightly conservative, I think. But we've chosen to stick with that. But I mean, mechanically, you might have an argument that we could also have gone a bit higher if we had chosen to.

But then if I look at... Sorry, what did you say?

Sorry, I'm just saying, does that make sense, Asbjørn?

Yeah, I mean, I guess it's also difficult with the rounded numbers to get the exact signs of this, and of course it's the guidance, so I do get that. Which is more that if we get, let's say, 100 basis points for Q3 and Q4, I guess your full year improvement is going to be 170 basis points or something like that, right? So those extra 70 basis points, do you see that as a headwind for next year? So if you print 50 basis points and prove it next year in your original plan, would you actually print 20 basis point deterioration to your underlying claims ratio next year?

Hi Asbjørn, Mads here. I think, I mean, you are seen from a mechanical point of view. You are right, because we are thinking it a bit like 150 basis points of underlying improvements then for this year, where we look at it from at this point and with 50 basis point being stochastic. And then you're right that we at our capital market state, we pointed to 50 basis points underlying improvement per year. as kind of the structural thing from our strategy initiatives. So mechanically, that would mean having 50 structurally next year would be flat, underlying, but we always strive to make a good underlying progress. So we will still believe that we could report at least a positive development in the underlying loss ratio next year.

All right, thanks. And then final question from my side. I know you're not sitting with the actual cases yourself, but do you have any sort of, have you seen anything or heard anything in the back of the Supreme Court ruling in terms of number of cases or the things, if your sort of estimate is still on the conservative side, any news on this front?

No, actually, we haven't received any, you know, claims being, so to say, re-initiated, which were already fully determined. So we've seen nothing and we have no, in actuality, no new news yet, which is also what we would have expected at this point in time.

All right, perfect.

Thanks a lot. Thank you. Your next question comes from Martin Burke with SCP. Your line is up. Please go ahead.

Thank you so much. Perhaps, Andreas, just on your initial comments about management actions in your commercial area regarding the 1% premium growth, underlying premium growth this quarter that you're not satisfied with. Could you please elaborate on that and then beyond the press that we've seen this quarter? And then in addition to that, I guess this workers' comp has been sort of has been bucking your premium growth in the commercial segment for now, at least three quarters. When do you expect this sort of hit when non-workers come to clear up and how much technical result is actually in it? And then maybe a last question on premium growth while we're at it. I mean, private lines continues to do very well. What kind of outlook do you see for private premium growth going forward? Thanks.

Let me try to go through that. Starting with the commercial area, we have the 1% you mentioned for, it's not really a segment as such, but it does give an indication of, let's say, it is an indication of what the broader based commercial book is doing on average. Obviously, there are also moving parts within that. Some parts are going very well, some parts are a bit more sluggish. But I think the overall message is that as an ambition, we would like and we would also expect to be able to grow more than 1% given the indexation we have right now in commercial lines. And with the management actions, I would say, I think we've had a very successful run, just to state that, within commercial lines. We've managed over the last few years and also in the last quarters, we've continuously brought down volatility and we've improved Profitability. And that has been successfully done by the previous management, also by Lone, who's been the head of that for the last few years. So I think when we now say this, we did an agreement with Lone, also a mutual agreement. And this is more about saying that where we are right now, we feel that new eyes are needed maybe to succeed a bit better with the growth within the areas we want to grow profitably. So I think that was the management part. Then the workers' compensation. Sorry.

Andreas, just to follow up on that management. I mean, what kind of leaders can you pull to restore this growth without compromising your profitability? Do you see any pockets where there are any low-hanging fruits that hasn't been picked yet? Or how should we view this?

Obviously, I believe that we can do better. I don't think it's about the price only within this area. It's about becoming even better at also translating the value proposition we have and the experience we have as a very experienced Danish commercial lines insurer with a full and sole focus on the Danish market. And I think there are a lot of things we can do to continuously improve that value proposition so we become even more relevant for both the customers we have and the customers we want to have. So I think that's at least giving some flavor on that. So moving on to workers' compensation, when will the headwind dissipate? As I heard the question, it was related to the pricing. I think it's very difficult, in honesty, to fully predict. We are in a market with other players, and some of those players Either they have a completely different view on the risk or they have different tactics around what they're willing to do than we are. So we'll have to see how it goes. I can't give you any clear indication. I think it's obviously going to be interesting to see what will happen after the Supreme Court ruling sort of gets settled in the market also as one thing. What will people do there? But I can't give you any clear prediction. We'll have to see as we go along. I can just say that we will continue to demand that our business is profitable also within workers compensation.

The premiums that are leaving, do you have any

Oh yeah, sorry, well, especially within the large commercial segment, it is almost no technical result which is leaving with those premiums. At least, and especially if you're looking at the levels we would be needing to underwrite at, that would be in some cases become loss-giving as an alternative scenario. And then there was a premium in private lines, personal lines. What to expect there? Could you just repeat it? What was the specific angle?

I mean, you do have this in your private lines. I guess you still have this funny dynamics that you still have a private checking franchise, which is still at Steaming ahead at full throttle, right? And sort of, you know, those growth rates have of course been high for a while. They're still high. And how, I guess my question is, should we expect this sort of mid-single digit to go on for also the coming year or years, so to speak?

Well, I mean, at least in the market we're in right now with the trends we're seeing and the performance we're seeing with our banking partners, we have no reason to expect that to dissipate in the coming quarters. If we go further than that, it's always a question of how does the market overall develop. I think it becomes a bit more tricky to predict. But at least for now, I think I'll state that the momentum we see for now, we expect to continue for now.

All right. All right. Thanks a lot.

Your next question comes from Alessia Magni with Barclays. Your line is open. Please go ahead.

Hi, morning. Thanks for taking my questions. Two from my side. One is around the workers' comp pricing. And I'd like to know how do you think pricing in the business line will evolve after the ruling? And what level of price increases do you think is needed for the industry to Compensate the higher claims burden. And more broadly, can you talk about your expectation on pricing and volume evolution from here, you know, the group level or if you could split by customer commercial? Thank you.

Yeah. Starting with workers compensation. If we look at the Supreme Court ruling, On the margin, that does impact our expected claims in an upwards direction for the same business going forward. We're still doing the analysis on how much we feel exactly is needed to mitigate for that. So on an overall, I would expect the market to have the same in terms of trend viewpoint on higher premiums being needed. How much the premiums will in actuality in the market, so to say, Thank you very much. You know, keen on experiencing, seeing what will happen with that. But I can say that we're looking into it. And the trend, obviously, all is equal is for higher premiums, given that event. More broadly, I think what we would expect to see in the coming years is that if you look at our group in total, we just talked about private lines. I think for now we see that momentum continuing. We're able to take market shares, particularly from our strong bank partnerships. So that trend, I think, is what we expect for now to continue. So overall, having some base indexation of around two and then some added market shares on top of that, two to three percent, maybe even a bit more if we do well. but something around the levels we're seeing now and I think for commercial lines in a broad sort of sense we'll have to see with workers compensation again I think it's a bit difficult to predict where that will end up exactly but in sort of broad sense I think we have no ambition we never guide for growth we don't have an ambition to grow just to grow but I would be very interested to see our ability to grow especially within the segments we choose to grow come a bit up So something I think I would be very satisfied if we can continue in an overall commercial book growing with the market, but improving profitability, bringing down volatility, still having that discipline, but also beneath that having some growth come in on top of the indexation within the segments we choose to grow, such as agriculture, as we have seen actually quite strong growth, and also within the general small to medium size, seeing some growth pick up there, then I will be very satisfied with that.

And that was very clear, thanks. One follow-up, sorry, on the first question. So from your side, from what you are seeing based on your analysis and investigation, I mean, are we talking about price increases of single-digit, double-digit? Do you have any indication that you can share that would be helpful? Thank you.

Yeah, I understand the question and the interest on this topic, but we are still looking into that and arriving at our final conclusion. So it's too soon for us to give that indication.

Understood. Thank you.

Your next question comes from the line of Carl Lofthagen with Berenberg. Your line is open. Please go ahead.

Yes, hi, thank you for taking my question. The first relates to some press speculation that your distribution partner, C-Bank, is potentially looking for a new insurance partner. I just wanted to check if there's any validity to this and if you can comment there. And then the second is just on the arbitration case with God. I mean, I guess I appreciate it's very early days, but could you provide a little bit of color just Thank you. Let's start with distribution. I think what you are adhering to is the press coverage of our long-standing partner

and partners within the now ALS Sydbank Group, looking into what the best solution for their insurance partnerships will be. And the only thing I can say is that we're very happy with the partnerships we have with all the banks in the ALS Sydbank Group. They've been long standing with Sydbank and also with Vestjysk, and we had a very successful recent onboarding of Arbeider & Standsbank. We feel we have a strong position on this in the Danish market, and we are obviously participating in that process with Sudbank. But I think any questions to that process or where they see how that timeline or other considerations, I think I'll have to refer to Sudbank on that way in Sudbank. Then the second question was around the Gaard arbitration. I'll try to give some clarity on how the timeline is. And so now we have this arbitration, which was initiated by GAAD. And I think as we've talked about, the process will basically be a process where they will send a reply, then we will send a reply to that, and then there'll be some interactions. and the final clarity, as I understand, could be somewhere around, you know, on the other side of summer break next year in 27. And I can't give any guarantees for that. That's sort of what I hear could be a realistic timeline. And then just to give an update on what's happened. I mean, what just happened is that we got the first I think it's actually the second. We got a new reply from Gaard, we just received, and we simply haven't had time to go through that. We got it here in the weekend, so we haven't had time to form an opinion on that. So we're going through that now, and we'll be looking through to it, and then I think the realistic, as I said, process forward will be there'll be a couple of more interactions on that, and then we'll see how it goes in the end.

Okay, thank you very clear.

And we have another question from Mathias Nelson with Nordia. Your line is open, please go ahead.

Thanks a lot. So, sorry for a follow-up question on the details and maybe a bit nerdy one, but on the underlying claims ratio improvement, when you said 100 basis points, just to make sure that we're on the same line, is that the discounted or undiscounted one, given the One-off thing that you had in Q4 last year, I think that actually matters a bit on the discounting in the commercial line. So maybe if you could just clarify which one we are talking.

I'm talking on an undiscounted basis. Okay, good.

Perfect. That was clear.

Okay, there are no further questions at this time. I will now turn the call back to Andreas Ruben Madsen for closing remarks.

Thank you. Well, I have nothing really to add at this point, so thanks a lot all of you for calling in and I hope you all have a great summer.

And that concludes today's call. Thank you for attending. You may now disconnect.