Full-year results 2022: profitable growth, higher profit and higher dividend

Ad hoc announcement pursuant to Art. 53 LR
St.Gallen, 6 March 2023

The most important details about the 2022 annual financial statements at a glance:

The dividend is to be sustainably increased on the basis of profitable growth 

• Helvetia continued generating profitable growth in its core business and increased its business volume on a currency-adjusted basis by 2.6% to CHF11,097.2 million (2021: CHF11,222.2 million).
• The driver was the non-life business, which grew on a broad basis in all segments and business lines. 
• Helvetia increases the cumulative dividend target: now a total of more than CHF1.65 billion in dividends is to be distributed by the end of the 2025 strategy period (previous target: more than CHF1.5 billion). The Board of Directors proposes to the Annual General Meeting an increase of 40 rappen in the dividend per share to CHF5.90 (2021: CHF5.50) for the past financial year.

Core business proves resilient thanks to diversified business activities 

• Helvetia posted a strong IFRS profit after tax of CHF614.4 million (2021: CHF519.8 million). Against the backdrop of a challenging market environment, the business has proven to be very resilient. The diversified business focus paid off in the form of a successful technical performance. 
• This includes a one-off gain from the sale of the Spanish life insurance company Sa Nostra Vida in the amount of CHF102.0 million.
• Helvetia's resilience is also reflected in its capitalisation, which remains excellent: the estimated SST ratio was over 300% as at 1 January 2023. 

Helvetia seizes further growth opportunities with helvetia 20.25 

• The consistent focus on customer needs and the expansion of sales channels enabled further growth in the core business.
• Moreover, Helvetia tapped into profitable new growth opportunities with the targeted development of the fee business. The Group thus increased fee income from CHF354.4 million in the previous year to CHF377.3 million in 2022. The fee business now contributes around 5% of the Group result, underlining the attractiveness of this business area.
• Moreover, Helvetia increased its holding in Caser from 70% to 80% and thus participates to a greater extend in the profitable development of the Spanish insurer. 

"Helvetia once again demonstrated the stability and growth potential of its business model in the 2022 financial year and created value for its shareholders on this basis", says Philipp Gmür, Group CEO of Helvetia, commenting on the 2022 financial statements. He adds: "This record result is based on a very healthy insurance business, a successful development in the fee business and a one-off effect from the sale of Sa Nostra Vida. It is particularly pleasing that the latest major advances in implementing the strategy are bearing fruit." 

Profitable growth in the core business non-life business as the driver 
Helvetia successfully continued on its organic growth path in its profitable core business during the 2022 financial year. The business volume amounted to CHF11,097.2 million (2021: CHF11,222.2 million). In currency-adjusted terms, the business volume increased by 2.6% (in Swiss francs: -1.1%).  

Overall, the Group's non-life business proved a strong growth driver with currency-adjusted growth of 9.4% to CHF6,965.0 million. In this business area, Helvetia posted broad-based gains in all segments. Growth was above the market in almost all country markets. Helvetia was thus able to further expand its market shares. 

In life insurance, business volume amounted to CHF4,132.2 million (-7.3% at constant fx). In individual life, Helvetia is continuing to pursue its strategy with a focus on capital-efficient business. Investment-linked products saw significant growth in Switzerland and Austria. Savings premiums in the Swiss group life business were lower due to the sustained market-wide shift from full insurance to semi-autonomous solutions. Helvetia is well positioned in this environment with its semi-autonomous products and flat-rate risk solutions. 

Robust technical results and one-off profit lead to record result 
Helvetia generated a strong IFRS result after tax of CHF614.4 million in the 2022 financial year (2021: CHF519.8 million). This was based on the stability and resilience of the business model due to its broad diversification. The resilience of Helvetia paid off in 2022 with robust technical results in non-life and life insurance. As a result, Helvetia was able to increase its technical result in non-life from CHF289.5 million to CHF307.1 million. The IFRS result in this business area was CHF289.6 million (2021: 389.3 million) despite the challenging environment in the financial markets. The margin after costs in the life business area grew to CHF510.7 million in 2022 (2021: CHF466.9 million). Last year's IFRS result had been far higher than in the previous year at CHF419.8 million (2021: CHF304.1 million). Besides the improved margin after costs, a one-off profit of CHF102.0 million from the sale of Spanish life insurance company Sa Nostra Vida had a positive impact on the life result. 

In both the non-life and life business, by contrast, the weak performance of the financial markets weighed on the investment results in the past financial year. These were down on the previous year's strong performance due to fluctuations in book values.

Combined ratio: efficiency measures and scale effects pay off
In the non-life business, the Group's net combined ratio improved slightly over the previous year, coming to 94.7% (2021: 94.8%). Despite rising inflationary pressure, a further post-pandemic normalisation of claims frequencies and major NatCat events in Specialty Markets, the claims ratio proved very robust. The cost ratio also improved as ongoing efficiency measures as well as scale effects due to profitable growth paid off. 

New business margin much improved
New business in the life segment performed very well. The new business margin increased to 3.3% (2021: 2.5%), driven by a more favourable business mix and higher interest rates. 

Capitalisation remains excellent
Helvetia continues to have an excellent capitalisation. The SST ratio was estimated to be over 300% as of 1 January 2023. Helvetia has been awarded an "A+" rating by S&P Global Ratings (S&P). 

Higher cumulative dividend target and new dividend increase
On the basis of the strong performance of its core business, the one-off profit from the sale of Sa Nostra Vida and the continuous optimisation of the use of capital, Helvetia is targeting an even more attractive distribution policy. For the strategy period up to 2025, Helvetia has set itself a new target of cumulatively paying out more than CHF1.65 billion in dividends (previous target: more than CHF1.5 billion). The Board of Directors will therefore propose to the Annual General Assembly that the dividend be raised by 40 rappen to CHF5.90 per share (2021: CHF5.50). 

Growth opportunities opening up through the helvetia 20.25 strategy
Helvetia successfully seized growth opportunities last year under the helvetia 20.25 strategy. One such example is the clear increase in income from fee and commission business by 12.4% to CHF377.3 million (2021: CHF354.4 million). This can be partly attributed to the expansion of the "Health & Care" ecosystem in Spain. In addition, Helvetia expanded its business with asset management services for third parties with a capital increase of the Helvetia (CH) Swiss Property Fund, thus increasing commission income. With the fee business, Helvetia is tapping into new sources of income, diversifying the business mix and reducing its exposure to interest rates. 

Helvetia is reporting a profitability figure for the fee business in the form of the fee margin for the first time in the 2022 financial year. The fee margin shows the income generated in the fee business after deduction of costs before tax. It came to CHF31.3 million in the reporting year. The fee business now contributes around 5% to the Group result. This figure underlines the attractiveness and profitability of the business areas in the fee business. 

Non-life business gains significance within the Group
Helvetia also increased its share in Caser by a further 10% to 80%, meaning that it is now participating in the profitable development of Caser to a greater extent. At the same time, the non-life business is gaining significance within the Group. 

In addition, Helvetia made selective smaller acquisitions in targeted business areas to support the implementation of the helvetia 20.25 strategy. For example, seven providers have been added to the "Health & Care" ecosystem in Spain. Growth opportunities have also been seized in Specialty Lines through the development of new expertise. In the engineering business, for example, a new underwriting team with a focus on insurance solutions for renewable energies and environmental technology was created. 

"The past financial year clearly shows: based on strong capitalisation and broad diversification as well as a profitable and growing core business, Helvetia is achieving sustainable dividend growth. At the same time, we can use growth opportunities by accessing new business areas", is how Philipp Gmür sums up Helvetia's performance in the past financial year. 

Changes in the Board of Directors and Nomination and Compensation Committee
As announced in December 2022, the Board of Directors proposes Dr Yvonne Wicki Macus and Dr René Cotting for election as new members of the Board of Directors at the coming Annual General Meeting. Jean-René Fournier, Chairman of Patria Genossenschaft, will not stand for re-election after 12 years. He was most recently a member of the Nomination and Compensation Committee. The Board of Directors proposes Dr Hans C. Künzle to the Annual General Assembly for election as a new member of this committee. 

Watch the video with Group CEO Philipp Gmür:

Key figures

About Helvetia Group  
Helvetia Group, with its headquarters in St. Gallen, has grown since 1858 to become a successful insurance group with over 12,000 employees and more than 7 million customers. It has been enabling its customers to seize opportunities and minimise risks for all that time Helvetia is there for them when it matters. Helvetia is the best partner and is present everywhere that protection needs arise, with insurance, pension and investment solutions from a single source as well as simple products and processes. The insurance group knows the business, from mobile phone insurance and insurance cover for the Gotthard Base Tunnel to the long-term investment of customer assets. Helvetia develops and opens up new business models with enthusiasm and drives forward its own business in a powerful and future-oriented manner. It acts with foresight and responsibility in everything it does: for the benefit of its shareholders, customers and employees as well as its partners, society and the environment. 
Helvetia is the leading all-lines insurer in Switzerland. In the Europe segment comprising Germany, Italy, Austria and Spain, the company has firmly rooted market positions for generating above-average growth. In the Specialty Markets segment, Helvetia offers tailored special insurance and reinsurance cover worldwide. With a business volume of CHF11.1 billion, Helvetia generated IFRS net income after tax of CHF614.4 million in the 2022 financial year. The shares of Helvetia Holding AG are traded on SIX Swiss Exchange. 

Cautionary note 
This document was prepared by Helvetia Group and may not be copied, altered, offered, sold or otherwise distributed to any other person by any recipient without the consent of Helvetia Group. The German version of this document is decisive and binding. Versions of the document in other languages are made available purely for information purposes. Although all reasonable effort has been made to ensure that the facts stated herein are correct and the opinions contained herein are fair and reasonable, where any information and statistics are quoted from any external source such information or statistics should not be interpreted as having been adopted or endorsed as accurate by Helvetia Group. Neither Helvetia Group nor any of its directors, officers, employees and advisors nor any other person shall have any liability whatsoever for loss howsoever arising, directly or indirectly, from any use of this information. The facts and information contained in this document are as up to date as is reasonably possible but may be subject to revision in the future. Neither Helvetia Group nor any of its directors, officers, employees or advisors nor any other person makes any representation or warranty, express or implied, as to the accuracy or completeness of the information contained in this document. 
This document may contain projections or other forward-looking statements related to Helvetia Group which by their very nature involve inherent risks and uncertainties, both general and specific, and there is a risk that predictions, forecasts, projections and other outcomes described or implied in forward-looking statements will not be achieved. We caution you that a number of important factors could cause results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include: (1) changes in general economic conditions, in particular in the markets in which we operate; (2) the performance of financial markets; (3) changes in interest rates; (4) changes in currency exchange rates; (5) changes in laws and regulations, including accounting policies or practices; (6) risks associated with implementing our business strategies; (7) the frequency, magnitude and general development of insured events; (8) mortality and morbidity rates; (9) policy renewal and lapse rates as well as (10), the realisation of economies of scale as well as synergies. We caution you that the foregoing list of important factors is not exhaustive; when evaluating forward-looking statements, you should carefully consider the foregoing factors and other uncertainties. All forward-looking statements are based on information available to Helvetia Group on the date of its publication and Helvetia Group assumes no obligation to update such statements unless otherwise required by applicable law.