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Good afternoon, everyone, and welcome to ScoreQ1 2025 results conference call. My name is Thomas Fossard, Head of Investor Relations, and I'm joined today on the call by Thierry Léger, our Group CEO, and François Barin, Deputy CEO and Group CFO, as well by other COMEX members. Can I please ask you to consider the disclaimer on page two of the presentation? And now I would like to hand over to Thierry. Thierry, over to you.

Thank you, Thomas. Hello, everyone, and thanks for joining the call. Let me start with a few key messages. I'm satisfied with the first quarter results. The performance of our three business activities has been strong, delivering 195 million euros of net income, an 18.3% ROE, and an economic value growth of plus 6.8% at constant economic P&C performance was excellent in the first quarter on a reported and on a normalized basis. The combined ratio for Q1 2025 is at 85% ahead of our forward 2026 assumption of below 87%. This was achieved despite the 140 million impact from the Los Angeles fires. In addition, we have been able to build significant buffers thanks to an excellent nutritional loss ratio in the first quarter. In life and health, with an insurance service result of 180 million euros and a neutral experience variance for Q1, we are on track to reach our full year forward 2026 assumption of around 400 million ISR. We continue to execute on our three-step life and health plan established last summer to restore the profitability of our new and in-force business. After almost nine months in charge of our life and health business, I was particularly pleased last week to announce the appointment of Philippe Rude as the new CEO of our life and health business. I'm confident that Philippe, with his experience and expertise, will be able to restore the profitability of our life and health business As a reminder, Philippe will start on 1st of June. Investments. At another strong quarter, we achieved 3.5% regular income yield at the upper end of our forward 2026 range. This is thanks to our high-quality fixed income portfolio that continues to benefit from elevated reinvestment rates. Our group solvency ratio stands at 212%, an increase of two points compared to the end of 2024. This increase is primarily supported by positive net operating capital generation, while market variances are broadly neutral. This is a strong outcome in a volatile market. Our economic value in Q1 has increased by 6.8% as constant economic growth. This puts us well on track to achieve our 9% economic value growth target for the full year. Last but not least, the Q1 ROE stands at 18.3%, which is well ahead of our 12% forward 2026 full year assumption and the result of all three business activities strongly contributing to the group net income. The April P&C renewals have been successful. In a softening market environment, our teams executed in a disciplined way on our new business strategy to grow in profitable and diversifying lines of business, i.e., alternative solutions and specialty lines. We maintained our technical stance on U.S. casualty, which, as a result, continued to shrink in terms of premium income. Overall, scores each EPI increased by 1.5% at the strong and only slightly deteriorating combined ratio. For the mid-year renewals, we foresee pricing to remain competitive overall. However, we expect some payback for the Los Angeles fires and generally stable terms and conditions. In this context, the technical profitability of our portfolio should remain relatively stable and attractive overall. To conclude, overall, the first quarter results are a good start into the year and we are on track regarding our full year objectives. In P&C, the year-to-date renewals set a strong base for the rest of the year. In life and health, our efforts start to be a fruit. Our investments continue to contribute positively to the bottom line. There is still work to be done, of course, but I am looking ahead with confidence. I hand over now to our group CFO for more details. François, over to you.

Thank you. Thank you very much, Thierry, and good afternoon, everyone. I'm very pleased to present our first quarter results. I will focus on figures excluding the mark-to-market impact of the option on SCORE's own shares, as usual. For the first quarter, we're happy to report an adjusted net income of $195 million and an annualized return on equity of 18.3%. All three business activities deliver and contribute to the group results. As mentioned by Thierry, P&C continues to show an excellent performance with a combined ratio of 85% despite the Los Angeles wildfires impact. The strong underlying attritional performance also allows us to build a material buffer opportunistically. Life and health insurance service results continue to improve with a neutral experience variant this quarter, including the U.S., Investment delivers a high return on invested assets of 3.8% and a regular income yield of 3.5%. Now, let me walk you through those results in more detail. Starting with P&C. With the successful renewals in January 2025, the new business ESM increased by 9% year-on-year. This comes from our disciplined growth in strategic diversifying lines, as well as from the strong profitability of the business that we are underwriting. Our retrocession program as well, placed at the beginning of the year, also contributes positively on the next technical margin, fully offsetting the inward business margin erosion in a softening market context. The P&C insurance revenue is down minus 0.7% for the quarter. The already mentioned large contract communication impact the Q1 growth rate by minus 0.8 percentage points. Excluding this effect, the insurance revenue growth is flat, because of two different dynamics on our portfolio. The first one, in reinsurance, revenue is up 3.7%. This is driven notably by alternative solutions and diversifying specialty lines, such as marine, IDI, and engineering. Property and property cuts are up 4%. These are very much in line with our expectations. The offset this quarter comes from our proactive actions to further reduce our exposure in U.S. casualty in each and every renewal since the 1st of January 2024. The impact is flowing through the IFRS insurance revenue, which is down 12% for this specific line of business in Q1. Excluding this U.S. casualty effect, the reinsurance portfolio grows by 5%. Second, if we look at the score business solution portfolio, we see an 8% decline for three drivers. Our strategic decision to stop underwriting a single-risk U.S. casualty business from London and Paris announced at the beginning of 2024. The second effect is linked to a timing effect on the renewals of some contracts in Q1 on which we expect the revenue to flow through in the upcoming quarters. and we have also a cycle management in relation to the current pricing environment on SBS. Our P&C strategy for Forward 2026 focuses on most profitable and diversifying lines, successfully resists to a softening market context, and ensures an end-change net technical margin at a very attractive level. This is evidenced by the 9% growth in new business ESM, which is going to be released into the P&L over time. We are very pleased about the results of this strategy. Before moving on to the next slide, I would like to remind you that we communicated in last December a minus 150 million impact of the large contract communication for H1 2025. In the Q1 accounts, we are seeing only a small part of the minus 150 million. The rest of the impact is likely to come in the Q2 accounts and can significantly and can significantly weight on the Q2 insurance revenue growth rate. On a full-year basis, I reiterate that the impact on the full-year 2025 growth is around minus 2%. Moving on to the underlying performance of our PNC book. Our PNC combined ratio stands at 85% in Q1, better than the forward 2026 assumption of below 87, in a quarter of elevated NATCAT losses for the industry. The NATCAT ratio is 12.1%, including 148 million net losses from California fires, consistent with the estimation that we provided earlier in the year. The rest of the CAT losses are limited in the quarter, accounting for less than two points of the CAT ratio. In such a quarter, our contained CAT ratio continues to demonstrate the underwriting discipline and the effectiveness of our NATCAT strategies. The 74.7% reported attritional loss and commission ratio is our lowest level since the transition to IFRS 17. In addition, this includes a significant level of prudence that we are able to build opportunistically given the excellent underlying performance this quarter. The minus 9.3% discount effect is higher than expected, reflecting mostly a larger share of U.S. claims this quarter, including the Los Angeles wildfires and some man-made claims, on a lower base of insurance revenue. And as you know, the discount rates are locked in when we write the contract, and this reflects the higher interest rate in the U.S. at the time of underwriting. So overall, if you adjust for CAT and discount, the normalized combined ratio would be 84.7%, so really, again, an excellent quarter for PNC. Now let's have a look at the life and health contribution. The life and health business generates a new business ESM of 76 million in Q1. This figure appears below our full year guidance of roughly 400 million on a quarterly basis, But remember that we have shifted the strategy of life and health toward higher return hurdles on the protection portfolio and the new business mix, mostly on longevity and financial solution, and this is just the first quarter of implementing the new strategy. In December, we mentioned of around 400 million new business ESM expected for year 2025 and 2026, and that it could be slightly lower in 2025, given that this is the first year, but we expect new business to ramp up in 2025. The insurance service result is at $118 million this quarter, with CSM and risk adjustment release in line with expectations and a neutral experience variance, including in the U.S. The business performance continues to improve this quarter, and we will wait for a few quarters before claiming any victory on this specific topic. Now moving to investment. We continue to benefit from an excellent performance on the investment side with a return on invested assets of 3.8% this quarter. This comes from an elevated regular income yield of 3.5% as well as from a positive fair value change on our private equity and infrastructure investment portfolio. As you know, we have gradually increased our value creation assets portfolio for a couple of years and we start to see the benefit coming through the P&L. In addition, we continue to reinvest the rest of the portfolio at a high reinvestment rate of 4.3%. Our economic value is up by €0.4 billion in Q1, representing 6.8% growth at Constant Economics from year-end 2024. This is driven by the successful P&C renewals at the 1st of January, as well as by the good performance from all three business activities. This translates into an economic value per share of €51, up 3 euros compared to the end of 2024. In consequence, our financial leverage decreased to 23.6% from 24.5% at the end of 2024. To conclude, I just would like to thank all our shareholders who maintain their trust in SCORE and their continued support since the beginning of the year in a context of geopolitical uncertainty which is not in the hands of the management. And with this, I will hand over to Jean-Paul Cosmechante for the April Reunion Walls with us.

Thank you, François, and good afternoon, everyone. I'd like to briefly share with you the outcome of the SCORE April 1st treaty renewals. As a reminder, these represent roughly 12% of our reinsurance portfolio and less than 10% of our global P&C business. They are highly focused on Asia Pacific, accounting for over 50% of the SCORE premiums up for renewal in April. Similar to January, April renewals saw a trend of increased competition and softening prices, particularly in the property CAT space and to a lesser extent in specialty lines. However, the decrease in prices was mainly limited to non-proportional treaties. Proportional treaties are still getting primary rate increases, and this is why we have overall stable prices. rate adequacy remains strong in most lines of business, with reinsurance terms and conditions broadly stable. In this environment, SCORE maintains its P&C strategy, growing strategically in preferred lines. Our portfolio's overall price and net technical profitability remain stable year-to-date compared to 2024. I will now drill down on the shaping of our portfolio at these renewals. We continue to execute on our forward 26 strategy, growing in preferred lines. First, we continue to actively grow our alternative solutions portfolio, focusing on capital relief quota shares with low economic capital consumption. Our portfolio growth is concentrated at this renewal in APAR markets with a 50% growth in that region. Secondly, we continue to expand in our preferred segments, achieving a 5% increase overall in marine engineering, IDI, and international casualty. Year-to-date growth stands at 9% versus 2024. A strong franchise gives us access to a wide range of opportunities, enabling us to remain selective and grow where rate adequacy remains attractive. Third, we have maintained a prudent approach to climate-exposed business. The Los Angeles wildfires and the active tornado hail losses in Q1 are reminders of the impact of climate-tensitive perils. However, their impact on April renewals was limited to loss-affected U.S. programs only. Pricing pressure continued on loss-free programs, which often renewed at minus 10% to minus 15% risk-adjusted rate on lines compared to 2024 prices. Lost affected layers renewed at risk-adjusted rate online increases of plus 10% to plus 15%. With Japan being the most competitive CAT market at this renewal, we grew our CAT premium in the U.S. and in other Asian markets for an overall growth of 6%. Combined with the January renewals, this translates into a year-to-date premium growth of 2%. As a reminder, a CAT Excel represents only 50%, 15.15%, percent of our total portfolio EGPI renewing on April 1st, and 12 percent of our total EGPI year-to-date. Lastly, we have maintained a selective approach to U.S. casualty. Lost trends, inflation, and nuclear verdicts continue to be the focus of renewal discussions. Although we have seen improvements in the primary underwriting from many of our clients, We do not believe there is still sufficient accumulated rate to catch up with past recent years' loss trends and lost cost inflation. In addition, reinsurance terms and conditions have remained broadly stable, thereby providing insufficient margins to reinsurers. Consequently, we're remaining very selective on the programs we support. This has led us to reduce our portfolio eGPI by one-third at April 1st and by 13% year-to-date. To conclude, the April renewals demonstrate once again the execution of our 3D portfolio strategy, gradually shifting the balance towards our preferred lines. Our underlying discipline enabled us to achieve modest growth at April renewals while keeping expected net technical profit roughly stable year-to-date. an increasingly competitive market with an overall estimation of 0.5, less than 0.5 deterioration of our technical margin year-to-date. Looking ahead to the June-July treaty renewals, we expect similar market trends with more loss-affected U.S. cap programs renewing. Barring any new major loss occurring in Q2, we expect continued competitive property cap and specialty renewals with pricing softening from peak levels and similar market discipline to what was observed in the earlier renewals. In this environment, we continue to execute our strategy to grow in preferred lines. I will now hand back to Thomas for the Q&A.

Thank you, Bernard Jumpeau. On page 20, you will find the forthcoming schedule events. With that, we can now move to the Q&A session. Can I remind you, please, to limit yourself to two questions each. And operator, with that, we can take the first question. Thank you.

Thank you, sir. Ladies and gentlemen, if you wish to ask a question, please press star and 100 telephone keypad. The first question is from Andrew Baker of Goldman Sachs. Please go ahead.

Great. Thank you for taking my questions. Both are on P&C RE. I guess the first one, can you just help me pick apart the insurance revenue growth? So the 4% to 6% CAGR for the plan, obviously in Q1 on a constant FX, you were sort of flattish if we exclude the large contract. I appreciate, I mean, you've laid out that that was reduction in casualty, lower SPS again from U.S. casualty. But I thought that these were already part of the plan. So you also mentioned some timing effects. So just help me to sort of think through where we're tracking versus that 46%. Is it sort of structurally lower or is some of this just timing differences? And then the second one, are you able to just provide a number on the buffer building Q1? And I guess the normalized combined ratio looks really strong, obviously strong if we adjust for this buffer build. So how should we be thinking about a four-year combined ratio versus the sort of 87% level that you lay out? Thank you.

Good afternoon, Andrew. Thank you for your two questions. So the first one, so let me come back on the insurance revenue growth. So that's true that – What you see in Q1 is below, I would say, our guidance of 4% to 6% for 2025 and 2026. If you adjust of the U.S. casualty effect that you see, I would say our growth is more in line, is below the range. What we do, and Jean-Paul can comment on this, but we really protect the technical profitability and the technical margin on the portfolio. You see the benefit of this strategy on the growth of the new business, CSM, which is at roughly 9% this quarter. We have a small effect as well in Q1, a volume effect on the structure of the alternative solution deals. We see a growth in insurance revenue of plus 34% of alternative solution deals. Typically, those deals can be structured with high commission or financial components, varying from 40% to 98%. You remember that during the IRD, we had a strong focus on this with an underlying assumption of, I would say, an average financial component in alternative solution deals of roughly 60%. What is happening in the 2025 renewals, on a few large contracts, we have adjusted the structure, so mechanically leading to lower volumes. But I insist on the fact it's not because you have lower volumes in insurance revenue under IFRS 17 that you have lower contribution in insurance service results. So that's key to understand this effect. It's just a mix, but the profitability is unchanged. and the growth of the contribution of alternative solution is unchanged. So it's a little bit too early to give you a guidance for the full year before the June and July renewal. So it's still too early to have a definitive view. But you can expect that we still expect a positive profitable growth for the full year. But I would say it will be a low single-digit growth under IFRS 17 in 2025. Second question on the buffer building. So you know that the buffer... We switched at the end of 2024. So we had the objective with Thierry to build at least 300 million of additional buffer into the risk adjustment by the end of the plan. This objective was reached at the end of 2024, so two years in advance. And we mentioned during the Q4 call that we were significantly above the target of 300 million. So we switch now. I mean, the buffer strategy is only opportunistic compared to the last 18 months, which was really a systematic approach each quarter. Here, again, I think both of us, Thierry and I, we insisted at the beginning of this call, mentioning that the underlying performance of PNC is excellent. When we mentioned that this is excellent, it's of course before buffers. So we opportunistically put aside this quarter some buffer. We don't comment on the number or the figure itself, but as I mentioned in the call, it's a material amount.

Great, thank you. Thank you. Can we take the next question, please?

The next question is from Kamran Hussein of JP Morgan. Please go ahead.

Hi. Just wanted to ask on P and C. Obviously, 84.7 in the quarter is a very encouraging kind of sign versus where you, you know, kind of versus the 87. Just wondered about the attitude internally whether, you know, like some of us were, you know, I'm fairly excited about that number today. You know, it's very positive. How do you feel about that internally? You know, excited, carried away, or is this a, you know, let's see how the rest of the year develops before we kind of bank on 84.7 being the right kind of underlying margin? And the second part of the question is on the – I guess on the reserve building, clearly, you know, the opportunistic approach I think is well understood. Why didn't you look at 827? Because I think if I use like NIST insurance revenues, take it to 87, it's something like 30 million more. So just interested why you didn't take it to 87 instead of maybe where you took it to today. Thank you.

Thank you, Carmen, for the two questions. On the first one, CFO, at least in my case, I'm never excited by any figure because So it's an historical quarter since the transition to IFRS 17, we mentioned it, especially when we look at the performance of the attritional ratio. Let's say to understand that when we choose the amount of buffer we put aside in such a quarter, the combined ratio is landed. So it's a decision ultimately of CRI and I. to select normalized command ratio close to 85% on published or normalized number. So it's a decision of the management to land the command ratio at this level and to put aside the amount of buffer that we decided, which is again quite material this quarter. Okay. So that's our choice. I don't know, Thierry, if you want to... to add something to the potential excitement of the CEO?

I think that, and Jean-Paul, I'm sure, would join me in this. There's also being proud about what the team has achieved over the last two or three years. I think this is, there's always a bit of luck we are in the region, we know it. But it is also the result of many years of excellent work on the P&C side. It was also a good strategy that... that we are having since a while and so this is a bit the fruit of all those efforts. So I think excited is also for me not the right word but proud of what the team has achieved definitely very much so.

That's right.

I guess it answer as well to your second question Cameron.

Yeah, I think it's clear. I'm very intrigued whether the 30 million that it would have taken to get to 87 is more or less than the number you've put away in Q1, but I'm sure you probably don't want to tell us that.

No, I won't comment on the amount. I think you should increase it a little bit. Fantastic. Thank you very much.

And the point is really, and I mean, when we say the attritional is excellent, then the attritional is excellent. That's should actually be very helpful to help you.

If you want to still have it with two strange eyes looking at me, you know that the buffer are in the expanse variance. So you look at the amount of the expanse variance this quarter. Just look at the plus and minuses in the expanse variance each quarter. So on the minus side, you have, of course, the higher NADCAT claims. I think it's quite easy to compute on your side. You have, keep this in mind, but you have lower insurance revenue than expected, so we trade a little bit on the negative side, and we have the prudence building. But on the positive side, you have the strong profitability of the quarter and the strong underlying attrition role. Again, I guess Thierry and I, when we comment the excellence performance, it's before prudence. There's lots to be proud about in the quarter.

It's a very good quarter.

Yeah. Thank you, Cameron. Operator, can we take the next question, please?

The next question is from Will Hardcastle of UBS. Please go ahead.

Afternoon, everyone. The first one is just linking with renewals and technical margin. You mentioned that year-to-date the net technical profitability deterioration is limited to less than 50 bps, and there's clearly a timing aspect from last year and this year's renewals. But if you were to – how much further, I guess – would you accept weaker technical pricing across the whole of 25 before that better than 87% combined ratio needs to be considered a bit of a stretch? I know that's a bit of a waffle, but just trying to understand how much headroom you have in this better than 87 for pricing to be able to keep printing that for next year, I guess, because it's more of an earn-through basis. The second one is, can you help us on the trajectory of revenues from this point? Obviously, we've understood what you've helped a lot there for 25 years, There's quite a lot of moving parts on how we should think about it going forward. I'm trying to understand how big a headwind could US dollar weakness be, perhaps how long this US casualty reduction drag can affect and when we get to that run rate on an underlying basis. Thank you.

So on your first question, I think we see overall the business coming from a high point and very good price adequacy. It's very difficult for us to tell you how much price decreases would be acceptable. It very much depends on the geography, the lines of business. All I can say is in this market, and you see that the renewals, we continue to grow where it makes sense. When we achieve overall premium growth, despite price decreases, it means we're increasing our exposures. So that reflects a little bit our risk appetite. And when you see in the renewals that we start decreasing the overall premium, then that will be the sign that we think we're reaching the limit of price adequacy in some segments.

Will, on your second question, So on the business side, I mean, we maintain our confidence, except the point we mentioned on the growth of insurance revenue for PNC in 2025, discussed a few minutes ago. It's still early on our side to comment on the effect on the tariff war that we see today. There is this 90 depots we will see in July. We are in a business which is not directly affected by what is happening. So I would say the only uncertainty could be linked to the impact on the macroeconomic environment at the end of the year. Could it be on the inflation side, on the interest rate side, or potential global recession? We think that we are quite resilient to face this potential uncertainty. It's too early to quantify it, but that's the only point I see. And as a consequence, as you mentioned, it's a potential weakening of the dollar. We publish in the URD the sensitivity of 10% weakening of the dollar on the equity side. We publish the sensitivity of the solvency ratio. I can add that if you need the sensitivity of the net income to a 10% weakening of the dollar, I would say it's roughly 5-6 points. negative five, six pounds. So it's manageable at the level of the group. That's really helpful. Thank you.

Thank you, Will. Can we move to the next question?

The next question is from Michael Hotner of Berenberg. Please go ahead.

Thank you. I really only have one question. I was looking at your Invest Today slide, and it shows economic value growth target of 9% balance. And if I understood correctly what you said, you've done 6.8 in Q1, so you're running at about two or three times the target rate. What did you assume wrong or what did you assume too prudently on the 12th of December? It seems this is not a small difference. It's a big difference. And then going back to the solvency, so the 212%, just if we think about, you know, your normal, you know, earnings and stuff, it feels like we could potentially land to close to 220 by the year end. I'm assuming that the reserve buffers or whatever is in the solvency. So what would that mean for potentially thinking about sales? Thank you.

Thank you, Michael. So on the economic value growth, so that's an objective of the plan, 9%. We did not recalibrate the objective of Forward 2026 during the IRB of December. So that's the objective of the plan published in September 2023. So growth of 9% per annum. So we deliver 6.8% of constant economics in Q1. As we saw it last year, there is a strong seasonality effect in the way we build the economic value during the year. So in Q1, you have the strong effect of the 1-1 renewal of PNC. You will still have some effect with the PNC. when we take into account the rest of the renewal in Q2, then this effect will disappear. So you should expect in the second part of the year a subdued growth of the economic value. So that's why we prefer this stage to reiterate the objective of 9%. And we are just happy and satisfied with the level of Q1. So don't see anything else than the strong renewal of PNC in the 6.8 and the high seasonality in the way we build the growth for the economic value. On the solvency ratio, so the 2.12, so just to comment a little bit on what happened in Q1 on the solvency ratio, so we increased by two points the solvency ratio. It's mostly coming from a very strong capital generation, particularly from PNC, net of capital deployment, so that's linked to the quality of the renewal and the performance of the book. You have the usual accrual of the dividend at 1.8 euro in Q1. There is no model change during the quarter. and we have a neutral impact from economic movement in Q1. To predict what will be the level of solvency at the end of the year, again keep in mind that there is a form of seasonality in the solvency ratio. We recognize, so it's a little bit disconnected from IFRS 17, but we recognize part of the 1-1 renewal in Q4. then the rest in Q1, then in Q2 again we take into account the rest of the renewal and you will have, we usually end the year with zero or even one negative point of capital deployment at the end of the year. So I think since from today the 220 seems to me a little bit optimistic.

And is the buffer whatever, is that in the sunset?

No, and so to your question, we were clear. Since we decided to build buffer, so there is a one-for-one connection between the reserves under IFRS 17 and Solvency 2. The buffer are now in the risk adjustment, and you know that we manage the risk adjustment in a quantile approach, which means that the buffer are not in the Solvency ratio. They are not.

Very clear.

Thank you so much.

Thanks, Michael. Can we move to the next question?

The next question is from Shanti Kang of Bank of America. Please go ahead.

Hi, yeah, thank you. So two questions. The first one is just on P&C. So just curious how we should think about the opportunistic buffers against your 75% to 80% reserve percentile. And then the second question is just back on life and health so obviously the q1 experience variance is a very good step that it's neutral but i was just curious to know when you think that will turn positive my guess is that over the longer term generally that would be a positive experience from a kind of prudent position so i'm just curious how you think that will develop over time thank you

Thank you. Thank you, Shanti. So on your first question, I think I mean to look at the quantile of PNC in Q1. First, we don't publish the quantile for the two segments. Just take it the way we manage it, the way I explained it a few minutes ago. At this stage, it's really given the very strong or the excellent underlying performance of the PNC book in Q1. It's a management decision, so it's mostly a decision of Thierry and I. On the experience variance on the life side, so it's slightly positive. We are satisfied by the fact it's positive as well on the US book. We are happy or satisfied with what we observe. As I mentioned it, I think it's too early to claim for any victory on this point, even if again we are satisfied from what we see. Given the size of the mortality book in the U.S., we still expect to have some volatility and to see a trend down of this volatility to zero. So we could still expect maybe a quarter or two with negative in the U.S. So it's too early to say victory, it's done, even if it's really encouraging.

Thank you. Can we move to the next question?

The next question is from Vinit Malhotra of Mediobanca. Please go ahead.

Yes, good afternoon. Just a little bit of follow-up and then I'll see. Just only the additional is excellent commentary. Sometimes in the past this also came from just lower incidence of manmade law fees. So, I'm just curious that do you think that could have played a role? Of course, you've mentioned all the hard work done over the years when you can see that. But I'm just curious and that and in that same context, you know, just thinking of the pricing and margin discussions, you did talk about LA Fires payback. how much are you, I mean, how much of that needs to happen for you to meet your objectives or be happy with these numbers or whether, you know, the sustainability of this kind of underlying loss ratio? So, you know, how important is that even for you? Sorry, there are two questions here. But that's really the topic then, okay, how sustainable, and how much is edify pricing important to you in this? And if I can ask about where you're building the students' process, I could, but if you choose not to answer, it's okay. Thank you very much.

So thank you, Vinit. On the first question on man-made, I think this quarter we see a normal or slightly below normal activity. So that's not the main driver of the good attritional. I'd say the man-made is in line with the expectation, and the attritional is really coming from the very good performance of the rest of the book. On your second question, so the June-July renewals, you know, the U.S. cap, is I'd say the larger proportion of the CAT book we renew, keeping in mind that CAT still remains in a relatively small percentage of the overall premium that's renewed, even at the June-July renewal. So, you know, the California wildfire payback will have an impact, and I think you'll probably see this in the overall price increase or decrease we'll have across the entire book. because there will be more loss-affected programs renewing. But for us, you know, it won't be a major driver of the overall price increase or decrease we have across the book.

Thank you. Thanks, Enid. Thank you. Can we move to the next question, please?

The next question is from Ian Pierce of ExanBNP Paribas. Please go ahead.

Hi, afternoon, everyone. Thanks for taking my questions. The first one's just on the new business in life. So the 400 million guidance, it sounds like that's probably going to be a challenge for 2025. I'm just wondering why you think that that will start ramping up in the second half of the year and into 2026, obviously. The change in the sort of profitability in areas you're targeting is leading to a slowdown, but just wondering why you're expecting that to start growing again if the strategy isn't going to change from what it is at the moment. And then the second one, I think it was just a follow-up, so I'm not sure it was answered when Will asked it, but just what the headwind you're expecting in H2 from the further reductions in U.S. casualty in the insurance revenue would be really useful. Thank you.

Thank you. Thank you, Yann. So on the first question, if you remember what Thierry presented mid-December during the IRD, so the new strategy or the updated strategy on the Life and Health book. So we decided to increase immediately the hurdle rate on new business, which has the implication mostly on the protection book. to reduce almost day one the premium but to protect or to increase the margin. So that was an effect that is expected, so a drop of the premium on the protection book. And then the strategy is to change progressively the portfolio composition or portfolio mix and to diversify the protection of the mortality portfolio on longevity and financial solution which are less capital intensive and have much higher margin. So this effect will take a few quarters before it will be visible. We have a certain number of, I would say, longevity deals in the pipeline that we should see them in the next quarter. It will take a little bit more time on the financial solution side. There is a kind of G curve, a slight decrease that was expected at the beginning in the new business CSM before we have catch-up effect from the diversification on JVT and the financial solution. So there is nothing else that was expected. I think we commented this effect during the IRD or the Q4 results, and that's just what you see in Q1. And we prefer to say that the 0.4 billion guidance is mostly valid for 2020-26. Maybe on U.S. casualty for H2?

Yeah, so U.S. casualty represents roughly 15% of the overall premium that's up for renewal in June-July for us. And, you know, we expect a similar approach to... to those renewals that we had in the prior renewals this year. So we're looking at each client individually, each program individually, looking what actions the client has taken, how the reinsurance terms and conditions evolve or not, and that will drive basically the actions we take on that portfolio. So, you know, if you project an average of what we've achieved, you know, so far, to, you know, 15% of the volume up for renewal, that gives you some estimate of what the impact would be.

Thank you. Thank you, Jan. Can we move to the next question, please?

The next question is from Hadley Cohen of Morgan Stanley. Please go ahead.

Hi, thanks very much. Just one question remaining, actually, from me, and just a very quick one. The running yield on the portfolio is around 3.5%. Reinvestment rate is 4.3%. What would be really useful, though, if possible, is to get what the yield on the maturing assets through the end of this year are so that we can get a real sense of how to think about the incremental uplift on the investment return. Thanks very much.

Thank you, Adlai. This information we don't provide, so you see that the reinvestment rate is still higher than the regular income yield, which means we can still increase the contribution of the fixed income portfolio to the net income. We don't provide the yield on maturing assets or on the back book. But it's not a complex exercise. You have the duration of the portfolio. So you can imagine it's a short duration, even if we increase over the last 12 months by almost one year the duration. But that's something I think you can easily compute. if you take into account that 50% of the portfolio is denominated in dollar and 30% is denominated in euro.

Okay, understood.

And we just reiterate the guidance. We are more in the higher part of the guidance, and I think that should be confirmed for the rest of the year.

Thanks, Adil. Can we move to the next question, please?

The next question is from Faizan Lakhani of HSBC. Please go ahead.

Hi there, thank you for taking my questions. In terms of the combined ratio, I know it's been answered a number of different times, but obviously you're operating at a much better level than your guidance. Even with rates falling, it feels like you've got a lot of room within that. Is there anything that puts it at risk where you feel like you can't get to 87% or below combined ratio And if not, then is there a plan to lower that guidance going forward? Second question is on the economic value calculation. And maybe it's something I've not picked up on or fully understood. And it's probably the opposite way that my colleague Michael was talking about it. But from Q1 to Q4 onwards, you still have the... net income minus the dividend to be paid out. So should we actually expect the EB to fall in the rest of the year rather than grow from here?

Thank you. I mean, I'll take the first question.

You know, right now the portfolio is performing much better than the 87, as illustrated in what we published in Q1, including buffers. We haven't changed. We don't intend to change our guidance, but, you know, we have high confidence that, you know, we'll be able to meet the net combined ratio below 87 for the year.

Faisal, on your second question, so just, I mean, to reiterate that we net the dividend from the computation of the economic value growth during the year. I guess if you have any questions on the real, I mean, how we take into account the construct economics effects such as ethics and interest rate, you can call the team and they will work you on the methodology.

I guess on the second one, just in the past you used to have pull-to-power as part of your guidance for the growth.

Is that no longer part of the calculation or requirement anymore within that? No, it's not. Thank you.

Thanks, Cezanne. Can we move to the next question?

The next question is from Darius Sabkwaskas of KBW. Please go ahead.

Hiya. Thank you for taking my question. Just one, please. In regards to the reserve prudence you've been building in the P&C business, would you be willing to use it to limit the soft market impact on your earnings when it comes, or is this really a protection against the earnings volatility from cats and the like? Thank you.

Yes, Darius, I think, I mean, we already mentioned, I mean, we are going to use the buffers that we put aside and we started to put aside during the summer 2023 when it will be useful. So probably it's when the PNC cycle will be really soft, not before. So don't expect any use. Thierry, maybe you want to add something on this?

Yeah, I think also you said it right. It probably needs a combination of a soft market and a large claim. Currently, however, we are not in that environment. I think the margins are solid enough to absorb volatility at this point in time. But as it is, or has always been the case in the past, there will be more difficult cycles. And at that point, we might use it. Now, we are, you know, in our minds, we're just in another mindset now. It's more on the building side than on the usage.

Thank you, Darius. And we're going to move to probably the last question.

The last question is a follow-up from Michael Hutner of Birnberg. Please go ahead.

Hello. It's probably going to be very short. I think in Q3 or Q4 you mentioned a provision against arbitration. I just wondered if there's any update on this topic.

Michael, I don't know if your question is an update on the provision or an update on what is linked to the provision. There is no change in the provision, Inc. 1. The only thing I can say on the current arbitration process with Covia, We expect now probably the decision of the panel, we expect this decision probably more at the beginning of 2026. We see less probability of a decision of the panel by the end of this year. That is the only update we see on our side. Fantastic. Thank you.

Thanks, Michael, and thanks, everyone, for attending this conference call. So our team is available for any questions you may have as a follow-up. As usual, so don't hesitate to give us a call. As a reminder, the call will release its Q2 2025 results on the 31st of July with a call at 2 p.m. CET. And with this, we wish you a very good afternoon. Thank you all. Bye-bye.