Sampo Oyj

Good morning, everyone, and welcome to Sampo Group's conference call on full year 2025 results. My name is Mirko Hurmerinta, Investor Relations Manager at Sampo. I'm joined on the call by Group CEO Morten Torsrud, Group CFO Groot-Arne Alsaker, and Lars Kufalbeck, Group CFO, as of the beginning of April. The call will include a short presentation by Morten and Lars, followed by Q&A. A recording of the call will later be available at Sampo.com. With that, I hand over to Morten. Please go ahead.

Thanks, Mikko, and a warm welcome from my side as well. Sampo delivered another strong year in 2025, marked by consistent execution, robust profitability and solid momentum across our private and SME segments. We achieved a like-for-like growth of 8%. Combined with disciplined underwriting, a benign claims environment and continued efficiency gains, supported even by top Denmark synergies, this resulted in an underwriting profit of 1.5 billion euros. Our investment portfolio also performed strongly. driven by both NOBA's contribution and solid returns from the regular investment portfolio. Operating EPS reached €0.50, and the board has proposed a regular dividend of €0.36 per share, a 6% increase year on year. Sampo remains committed to delivering substantial value to its shareholders, and today we also announced an adjustment to our distribution policy which Lars will elaborate on shortly. Our underwriting results grew by 13%, actually for the third consecutive year, representing then more than 40% cumulative growth over this period. The main driver of this performance has been organic growth, with consistent strong momentum in our private and SME segments. I will return to the private business shortly. In SME, customer adoption of digital services is following the same pattern as we've seen in the retail market, exactly as anticipated and planned for. As a result, top-line growth has accelerated. SME premiums grew by 7% in 2025 compared to 5% in 2024 and 4% in 2023. Last year, we added more than 3,200 new commercial customers, predominantly SMEs, while maintaining high and stable retention. Part of the underwriting improvement reflects favorable weather and large claims outcomes, but the underlying trend remains strong. We continue to offset claims inflation through disciplined pricing. 2025 was also the first year of delivering synergies from integrating Top Denmark into our Pan Nordic platform. We achieved run-right synergies of 37 million euros ahead of the original 24 million euros target for the year, though largely due to timing effects. We remain firmly committed to our 140 million euro target for 2028. However, now, of course, we'll increase confidence. Let's turn to our retail business, beginning then with Private Nordic. Private Nordic has delivered strong and sustained growth, and the momentum throughout 2025 reinforces the competitive strength of our modern remote distribution model. Like-for-like growth reached approximately 9%, with solid performance across all major product lines. Personal insurance continued to stand out, growing 11% as we added 30,000 new insured individuals in 2025. The outlook in this area remains highly positive, supported by rising demand for services that complement public health care. In digital sales, we reach our operational target of €175 million one year ahead of schedule. demonstrating the increasing significance of this channel. Our digital capabilities, combined with our scale and technical expertise, also reinforce our position in partnership channels. In 2025, we renewed all major partnerships across all markets, including in the Swedish mobility sector. This underscores our position as the preferred partner to the automotive industry and provides valuable insight into motor industry trends. It's particularly encouraging to see that we also secured four new mobility agreements in Denmark, reflecting how our strengthened position in the market is now transforming our ability to compete for and win new partnerships. Turning then to Private UK. In 2025, we delivered 13% like-for-like premium growth, supported by a 16% increase in policy count. However, motor pricing continued to soften throughout the year. While we have captured the growth opportunities available to us, we have also scaled back activity in line with market pricing trends. This was reflected in a slower policy growth trajectory in the second half of the year. We continue to view the UK market as rational, but achieving our target margins has naturally become more challenging in the current pricing environment. Despite this, we remain highly confident in our long-term prospects in the UK In recent years, we have consistently demonstrated our ability to balance growth and profitability, and we are continuing to invest in proprietary data, pricing sophistication, and enhanced digital capabilities. Underwriting discipline remains paramount, for example. We will continue to target business in the UK that fits within our 88 to 90% combined ratio ambition. In the softer phase of the cycle, this means operating more towards the upper end of the range. With that, moving from the insurance operations to investments and the balance sheet, and I'll hand over to Lars to comment a little bit on that.

Thank you so much, Morten. In 2025, Sample delivered a strong investment income on the back of strong returns across both fixed income and equities. Our fixed income portfolio continued to provide a stable interest income, although slightly down year on year. The mark-to-market yield is still slightly below the running yield, which implies that a small further reduction is expected in 2026, assuming of course no material swings in the interest rate environment. However, the main driver for our strong investment income in 2025, and for the fourth quarter as well, was our stake in NOBA. Following the successful IPO of NOBA, we saw a 540 million Euro gain, of which 173 million came in Q4. Beyond NOBA, equities in our portfolio performed well in 2025, where we continue to benefit from being exposed to this asset class. If we look ahead into 2026 in terms of investment strategy, we are being quite cautious about deploying new money at this point in time, given the tight spreads, high equity valuations and the geopolitical uncertainty we see. Talking about capital generation and capital management. Sambo runs a highly cash-generative business and a very strong balance sheet. Our solvency stood at 174% at year-end, but it is cast on a very strong basis, with the symmetric adjustment materially higher than a year ago, and with benefits from further NOBA sell-downs and the Danish partial internal model change to come. In total, Sampo generated 1.5 billion euros of deployable capital in 2025, bringing our cumulative capital generation in the strategic period to date to 3.5 billion euros. This puts us well on track for the more than €5.5 billion target we have set for the 2024 to 2026 period. In 2026 we see deployable capital generation being driven mainly by our operating profits, but on top of that we do have effects from the partial internal model for Denmark and potential NOPA sale down. The regulatory process around the Danish partial internal model has taken a little bit longer than originally anticipated. However, nothing has changed with the estimated €60-90 million SCR benefit expected, in which we remain very confident. On NOVA, we are currently in a lock-up, but we will of course look for opportunities to sell down our stake further, assuming we can do so at an attractive valuation. When it comes to buybacks funded by disposals in our last capital markets day, we said that we would distribute up to 500 million euros, which means that there is 350 million euros to go after the latest buyback. Beyond that, we will take a closer look at the excess capital position when that time comes. Remember, we want to maintain a very strong balance sheet with a solid liquidity buffer in our hold call. Shifting from capital generation to capital distribution. This morning we announced an update to our distribution policy, enabling us to provide an attractive mix of dividends and share buybacks going forward. Firstly, it's important to note that this affects only the mix of capital returns, not the total amount of capital to be returned to shareholders. We stay committed to a very strong capital discipline, where we in a normal year expect to return around 90% of our operating result to shareholders through dividends and buybacks. Secondly, Sampo remains committed to distribute a reliable and progressive regular dividend. And in a normal year, the majority of our operating result will continue to be redistributed through dividends, but effectively we are lowering the dividend payout ratio floor from 70 to 60. We believe buybacks offer an efficient way to invest in our steadily growing business, and we know that a lot of our shareholders agree with this. At the same time, we continue to offer growing progressive dividends for more income-oriented investors. Looking ahead, we aim to grow the regular dividend broadly in line with the €2 annual increase that you have seen since 2020. That's all from my side for now, and back to you, Morten.