Hannover Ruck SE

Ladies and gentlemen, welcome to the Hannover Ruck conference call. I am Matilde, the course call operator. I would like to remind you that all participants will be in listen-only mode and the conference is being recorded. The presentation will be followed by a question and answer session. You can register for questions at any time by pressing star and 1 on your telephone. For operator assistance, please press star and 0. Unauthorized recordings for publication or broadcast are not permitted. At this time, it's my pleasure to hand over to Karl Steinle. Please go ahead.

Well, good morning, everyone, and welcome from Hanover to our earnings call on our results for the first nine months of 2026. And today's speakers are, as always, Clemens Jungsthofel, our CEO, and Christian Hermelingmeier, the CFO of Hanover Re. For the Q&A, they are joined by Claude Chèvre and Sven Althoff. And with that, I hand over to you, Clemens.

Yes, thank you, Karl. And good morning, everyone from Hanover. So let's dive into it. So in essence, we are very pleased with the business performance in the first nine months of 2026. The underlying profitability is very strong in both business groups and furthermore our balance sheet and the resilience have been further strengthened and will of course support future earnings growth. The overall loss environment in P&C reinsurance has been benign and together with the overall increase in reinsurance capacity in the market this has clearly intensified competition in P&C reinsurance Nevertheless, reinsurance rates do remain risk adequate on a broad basis. We have therefore continued to expand our portfolio on a diversified basis, highlighting our strong ability to grow the business. Our strong client relationships are a key driver of this growth and underpin demand for Hanoveri as a reinsurance partner. So let me return to our overall performance in the first nine months of 2026. With the group net income of €2.1 billion, we are well on track to deliver on our group net income target for the full year. In P&C reinsurance, the combined ratio of 83.7% is comfortably within our target range, which is below 87%. and in line as you know with our usual approach we have booked a full large loss budget for the period despite actual large losses coming in significantly lower. Furthermore, the strong underlying profitability gave us room to further increase our reserve resiliencies in the first nine months. So P&C revenue growth has clearly improved in the third quarter in line with our expectations, as you will recall from the calls in Q2 and Q1. So overall reported top line growth remains affected by currency effects, lower volumes in structured reinsurance, and changes in commissions and in non-distinct investment components. However, the momentum in our traditional business has clearly picked up. As we expect this positive trend to continue, the lower end of our 2026 growth target remains within reach. The new business CSM of 2.3 billion euros reflects our successful renewals in 2026 The very small new business loss component confirms the continued high quality and the attractive profitability of the new business that we've been writing. On the life and health reinsurance side, this also continues to perform well, confirming the positive trend in recent quarters. The new CSM, the new business CSM generation of 503 million euros supports our business plan and the outlook. The reinsurance service result of 717 million euros reflects healthy underlying profitability and we are well on track to achieve our full year target. The investment performance was again very strong. The return on investment of 3.7% is comfortably above our 3.5% target and it was not driven by any material extraordinary items. Finally, our capitalization remained excellent with a solvency ratio of 242%. Operating capital generation was strong at around 2.1 billion euros in the first nine months of 2026. At the same time, the capital requirements increased by around 1 billion euros, more than offsetting the positive impact from capital generation on the solvency ratio. Importantly, this increase reflects attractive growth opportunities and therefore successful capital deployment in a still favorable market environment. Turning specifically to the third quarter, the capital requirements increased particularly strong as they do reflect for the first time our planned growth for 2027. At the same time, the owned funds generation was below average. That is due to firstly in P&C reinsurance new business contribution is seasonally low in Q3 as a smaller share of business is renewed during this third quarter. Secondly, assumption changes in life and health reinsurance had a negative impact. Overall, operating changes in own funds and capital requirements reduced the solvency ratio by 7.5 percentage points in the third quarter. Together with the quarterly dividend accrual, this explains the decrease in the ratio. The shareholders' equity rose by 5.7%. In addition to the positive contribution from our nine-month results, currency effects were also positive. The CSM grew by 8%, mainly reflecting our successful new business generation across both business The risk adjustment increased by 4%, driven by new business written in P&C. The significant value creation shown on this slide is confirmed by the strong return on equity of 21.1%, which compares favorably with our reinsurance peers, despite booking the full large loss budget and the additional increase in reserve resilience. And on that note, over to you, Christian.