Sampo Oyj

Good morning everyone and welcome to Sampo Group's conference call on the third quarter 26 results. My name is Mirko Hurmerinta, investor relations manager at Sampo. I'm joined on the call today by Group CEO Morten Torsrud and Group CFO Lars Kufal-Beck. The call will include a short presentation by Morten and Lars, followed by Q&A. Recording of the call will later be available at sampo.com. With that, I hand over to you, Morten. Please go ahead.

Thank you, Mirko. And warmly welcome to the Sampo Q3 conference call from my side as well. And perhaps thank you for taking time to participate in this meeting at a time when there is a lot of other interesting things happening in the world around us. But on Sampo then, the third quarter was once again a statement of our strong performance, driven by broad-based topland growth and strong margins across the group. Our like-for-like GWP growth accelerated to 6%, up from 5% in the second quarter. The performance is strong in all the largest divisions, with 6% growth in private Nordic, 7% in the UK and 7% in commercial Nordics, where growth in SME stands out with a staggering 9% growth in the third quarter. The growth is also increasingly volume-based, which is good to see now that inflation is tapering off a little bit. So we see a growth in number of customers and number of objects in all of these three divisions. Meanwhile, our insurance revenue increased by 9%, supported again by positive development in all our segments. This time, perhaps also good to highlight industrial, where we benefit from a change in business mix following our de-risking actions in property. and lower reinsurance prices that are now more visible in the insurance revenue line. The improved traction seen in the second quarter and even more in the third quarter brings our year-to-date like-for-like GWP growth to 4% and insurance revenue growth to 8%. Combined with disciplined underwriting and another quarter of favourable severe weather and large claims development, our underwriting result increased by 9% on a currency-adjusted basis in the third quarter. Operating EPS increased with 8% year-to-date, whilst a more moderate 2% in the third quarter isolated. The latter was on one hand driven by higher underwriting results and a positive effect from our recent buyback programs, but on the other hand largely offset by lower realized investment gains than in the prior comparison period. Following this strong 9-month performance, and on back of robust growth and also favorable claims development throughout the year we have once again adjusted our outlook upwards for the full year on the insurance revenue side we increased it slightly up to now 9.75 to 9.85 billion euros and on the underwriting side we adjust the range from 1,550 to 1,625 million euros to now 1,600 to 1,650 million euros. The new outlook indicates 7-9% top-line growth and 8-11% underwriting result growth year on year. Needless to say, I'm of course extremely happy with a very strong performance over the first nine months of this year. While again we had an excellent quarter and there will be a lot of things to highlight in each and every segment, I thought I should still reflect a little bit on the longer-term performance as we now are approaching the end of our current strategy period. As you can see from this page, we have ticked every box so far. And I'm very confident that this will also be the case when we close our books for 2026. Since 2024, we have delivered 8% topline growth and 11% underwriting result growth on average. If we use the midpoint of our 2026 outlook, we are set to deliver about 40% underwriting profit increase over this three-year period. While the favorable claims environment in terms of benign outcome on severe weather and large claims had a positive contribution, the growth was primarily driven by our broad-based and durable top-line growth. At the same time, our underlying margins have remained strong and even improved a bit, thanks to our disciplined underwriting and consistent cost-efficiency improvement. This has been further fuelled by the strong delivery on top Denmark synergies that have been realising well ahead of our initial expectations at the time when we announced the acquisition. The headline figures have been driven by strong performance on our key operational ambitions. For example, in the UK we have seen 20% underwriting result growth on average, which has been well above our initial ambition of 10-15% growth. Same thing with personal insurance, which has been enjoying double-digit like-for-like top-line growth. I'm really pleased to see at this time our retention has remained high and stable with impressive customer satisfaction score. And consequently, we have also been able to grow the number of customers as well as the insured objects in all key segments. That said, none of this was achieved due to any exceptional circumstances, M&As or other one-off effects. This is rather a result of consistent investments in our operational capabilities, cost efficiency and customer propositions over a much longer period. And importantly, this would not have been possible without our dedicated and talented employees across the group and also the strong support from our partners. All in all, I see us being well positioned to continue building on this strong foundation and further leveraging our scale and operational pole positions in a vast number of areas to deliver superior value to our customers and, as a consequence, also substantial value to our shareholders. Then switching focus a little bit and talking more about some exciting balance sheet items where I will hand over to Lars.

Thank you so much Morten. The third quarter of 2026 was another volatile quarter in the capital markets and this time more on the fixed income side. While our investment portfolio continued to deliver very solid interest and dividend income, the sharp increase we saw in interest rates during the quarter led to sizable mark-to-market losses this time around. However, remember that these are short-term effects, and higher interest rates enable us to reinvest at higher yields, supporting investment returns in the long term. In fact, our average deal rate on new fixed income investments during the quarter was 4.2%, slightly above our running yield at the end of Q3. During the quarter, we also continued to reduce our ownership on NOBA by successfully selling just short of 15 million shares, generating 111 million euros in growth proceeds. Overall, both of our legacy assets, NOBA and Nexi, had a positive contribution to our net investment income, which was nice to see. Moving to the Solvency development, which was quite straightforward also this quarter. Strong operational performance and some extra on top of that from the market effects and the sale of NOBA shares. This was partly offset by the other items barred in the chart. This includes a number of various different factors. One of these is the underwriting seasonality as expected, which tends to be positive in the first quarter of the year and then unwinding into negative effect towards the end of the year. Also, the VAT part of the IT-related intangibles impairment that we announced in September had a small negative effect as well as the coupon payment on our hybrid debts. Then we also added some further prudency to our reserves, partly reflecting the prevailing uncertainty regarding claims inflation outlook due to the higher oil prices, and that in turn increases our insurance risk SCR. Overall, though, I am very, very happy with the 175% solvency coverage that includes the full 90% distribution accrual, particularly given that the symmetric adjustment is still quite high. And as a reference, with 0% symmetric adjustment and all else equal, our solvency would have been 179% for the quarter. For those of you who made it to page 21 of our Q3 report, you will have noticed that we will make some changes to our operating result and operating EPS key figures in 2027. Firstly, to avoid any confusion with the new IFRS 18 line item Operating Profit, we have decided to rename these key figures to Core Result and Core EPS, effective from the beginning of 2027. At the same time, besides the naming, a few other changes will be made to the calculation of the new core result. Interest expenses on RT1 nodes will be included in the key figure, as they have cash effect. And then to have an even more consistent treatment of mark-to-market effects, certain derivatives will be excluded. And finally, the fixed tax rate that we use for this metric have, for simplification reasons, been increased from 21 to 22% to better reflect the actual effective tax rate we see. As you can see from the right hand table, the impact of these changes is non-material. And I'm sure that some of you have already figured out that announcing these changes now might indicate that we will also continue to have an EPS metric as a final financial target in the next upcoming strategy period. And by doing it this way, we don't have to spend time at the upcoming investor update explaining and introducing the core EPS concept. That was all from my side this time around, and back to you, Morten.