Tryg A/S Ord New

Good morning, everybody. My name is Gianandrea Roberti. I'm Head of Investor Relations at TREC. We published our Q2 results earlier this morning, and I have here with me Johan Brammer, Group CEO, Allan Theisen, Group CFO, and Mikkel Karsten, Group CTO, to present the figures. Before that, I'd just like to remind everybody to ask one question at a time to allow the highest number of questions from participants. With these words, over to you, Johan.

Thanks a lot, Gian. And before I kick it off, I'd like to stress that after a few quite noisy quarters, we are very pleased to report a quiet quarter on multiple fronts. This is a quarter that brings us a little back to being a leading and slightly boring Scandinavian insurer with high and stable profitability levels. And with that, in this Q2, TRYK reports an insurance revenue growth of 3.9%, driven by price adjustments across all business units. And when looking at the private and commercial segment together, the growth was just shy of 6%, while the corporate segment decreased in line with Q1, which, broadly speaking, is aligned with our strategy to reduce exposure to this segment. The insurance service result for Q2 was 2.212 billion, helped by previously mentioned price increases and improving underlying performance, as well as a positive last claims experience for the quarter. Please note that the same quarter in 2023 included approximately 300 million higher than normal large-end weather claims. The combined ratio in the quarter is 76.8, probably our best combined ratio for a quarter ever, held by a very strong Swedish performance. The underlying claims ratio for the group improved 40 basis points, while it deteriorated similarly for the private segment. The investment result was 347 million, held by positive returns on most asset classes, especially equities and covered bonds, whereas the asset mix was virtually unchanged in the quarter. The overall pre-tax result stands at 2.129 billion, with Troik reporting an operating EPS of 2.93 and a roof of 44% in the second quarter. Troik is paying a quarterly dividend per share of 1.95 Danish kroner and reports a very healthy solvency ratio of 195, supportive of future capital repatriations. And with that turning to the next slide, we focus on customer highlights for the quarter, as we continue to see a very clear link between customer satisfaction, customer retention, and thereby our own distribution cost and overall profitability. In Q2 2024, we reported customer satisfaction score of 86, a similar level as in the same quarter last year, but an improvement compared to Q1 this year, where it momentarily just dropped to 85. I'm of course pleased to see a bounce back in the customer satisfaction in a period with continued high level of price adjustments. One of the drivers behind the improvement in the score for the quarter is the significant work that is being done regarding the onboarding of new customers when it comes to more efficient processes and customer communications. Customer satisfaction remains a strategic priority for us and it is essential for us and our ability to run a sustainably healthy business. Our focus on this is relentless and we aim to improve further from current levels. In the next slide, we detail the insurance service result for the quarter by business segment. And as always, the reported figures may be impacted by items such as the runoff results and the large and weather claims. As for the private segment, it is reporting a higher insurance service result driven by higher runoff gains and lower weather related claims. The previously mentioned increases in motor frequencies and average cost of claims across Scandinavia impacts negatively the combined ratio, all else being equal. The commercial segment is reporting a higher insurance service result driven by significantly lower loss claims, modestly offset by lower run-offs. Additionally, the combined ratio improvement is also driven by price adjustments and profitability initiatives. And lastly, the corporate segment is reporting a higher insurance service result driven by the much better large claims experience, partly offset by lower runoff results. The combined ratio improvement is also driven, of course, by price increases and the rebalancing of the portfolio. In the next slide, we take a slightly different split as we detail the insurance service result by geography. And to kick it off, it is initially important to note that on a group level, the difference between Q2 this year and Q2 last year is driven primarily by the different large and weather claims experience and the booking of the runoff result. As for Denmark, the primary difference comes from the runoff result, which was around 125 million higher last year versus this year. In Norway, the runoff result for the quarter is lower, but in general, the underlying performance in Q2 last year was very benign. And the Swedish performance, which you see in the bottom left corner of this slide, was held by a near total absence of large claims in the quarter and a higher runoff result. And the corresponding quarter last year included a very large claim, as you might remember, with a total cost of DKK 225 million, amongst a generally negative large claims experience. Now let's turn to slide 7, where we illustrate the progress on the RSA synergies. As mentioned, and in line with previous quarters, most of the CineD initiatives are not new, but still producing ongoing impact. We've added a total of 52 million in Q2 2024, but more importantly, we are now at 806 million since we communicated the transaction to the market, and we're staying firm, very firm on our intention to achieve the targeted 900 million for the full year this year. Procurement in this quarter contributes with 17 million and is primarily driven by our strong and consolidated purchasing power, which enables us again to get improved rates and conditions. As for the claim synergies, they are 15 million in the quarter and are primarily driven by optimization for fraud and recourse in Norway. And the commercial synergies are 14 million for the quarter and are driven by the improved relations with brokers in Sweden, capitalizing on the former Moderna's strong relations with brokers. And with that, I turn to the next section on the insurance revenue and portfolio. And in this first slide, we're showing the revenue growth for the group, as well as by lines of business explaining the key drivers. Troik is reporting a premiums growth of 3.9% in Q2, fully driven by the private and commercial segment, while the corporate segment is reporting a declining revenue in line with the strategy of improving profitability and rebalancing the portfolio. This decline in corporate is broadly in line with what was reported in Q1. The growth in private and commercial is predominantly driven by price increases to continue to offset general inflationary pressures and the increasing claims level in motor. The growth of private and commercial taking together is just shy of 6%, a level which remains similar to what was seen in Q1. The corporate segment is, as expected, continuing to report a noticeable revenue decline driven by profitability action and rebalancing initiatives to achieve a smaller, more local and more controllable book of business. The development for corporate is, as mentioned, also much in line with the first quarter this year. We continue to be very firm to mitigate inflationary pressures and hence continue to implement further initiatives to improve profitability for particularly, but not only, private Norway. Turning to the next slide, we are here showing the rate increases for the private segments. We repeat that we are pricing according to inflation for both property and motor in all countries. In fact, in Norway, we are actually pricing higher than inflation as we are very focused on improving the performance of our Norwegian private business. And to be very specific, we have accelerated the rate increase from Q1 to Q2 this year by approximately 2 percentage points for both property and motor. In addition to the price adjustments, we have also increased deductibles, which primarily will have an impact on average claims levels. On the next slide, on customer retention, we are pleased to continue to report broadly stable customer retention levels, even in a period with elevated price increases. The sub-segments in which we do notice a slight drop in retention remain the customers with the shortest tenure in the private segment, which are the customers that typically display the lowest level of profitability. This is totally in line with our experience in the past quarters. In general, looking at longer time series, it's evident how our business continues to show a relatively low price sensitivity across different economic conditions. And with that, I'll turn it over to you, Mikke.

Thanks Johan, and we now turn to page 13. In this slide, we comment on the group underlying claims ratio that improved by 40 basis points in Q2, slightly lower than the 50 basis points we reported in Q1. And improvements are supported by profitability initiatives across all segments. The private underlying claims ratio deteriorated by 40 basis points in the quarter, slightly better than in Q1 where the corresponding number was 50 basis points. And this is primarily driven by motor frequencies moving upwards across Scandinavia. It's important to note though that the development in Q2 was fully in line with our reset claims frequency expectations and no new deterioration. And we continue to expect an underlying claims ratio improvement for the full year 2024, ensuring the delivery of the 2024 financial targets and beyond. We also reiterate that the composition of the profitability improvement will change over time to be more driven by the private segment as rate and profitability initiatives get full earnings impact. Turning to slide 14. After a few volatile quarters, we are pleased to see a normalization in terms of large and weather claims. In fact, the sum of large and weather claims in Q2 is nicely below our quarterly normalized expectations. Large claims were 31 million in Q2 or 354 million for the first half of the year, virtually in line with our guidance for the six months. Weather claims were 104 million in Q2, slightly above our expectations of 80 million for the quarter. And for the first half of the year, the corresponding number is 483 million, somewhat above our guidance of 400 million. It should be noted that the weather claims reported in Q2 mainly comes from claims cost increases of the weather events that took place in Q1 in Norway. The discount rate was 2.4% at the end of Q2, 30 basis points lower than Q1. Generally, it should be remembered that movements in interest rates is a driver for this as well as changes in reserve mix and overall claims level. For this specific quarter, we saw broadly unchanged interest rates, but a relatively low claims level and small changes in the claims mix. The runoff result was 2.5% or 242 million, whereas the level for the first half of the year was 3.2%. And our guidance remains 3 to 5% for the full year 2024. And with that, I hand over to you, Gian.