European Loyalty: At 14 million euros pre-tax profits in the nine months

European Loyalty announced that profits before taxes remained at high levels and amounted to 14 million euros, significantly improving the results of the first half by 133.3%. Meanwhile, the Registered Premiums and related revenues of the company showed an increase of 4% and amounted to 165.1 million euros, compared to 158.8 million euros in the corresponding period last year. The Life Sector contributed to this increase in production by 7.9%, the Car Sector by 0.6% and the Other General Sectors by 5.5%. Regarding the third quarter of 2021, European Loyalty recorded significant dynamics both in terms of turnover and profitability.

In detail, the relevant announcement of the company:

Specifically, for the 9 months of 2021:

– The Registered Premiums and related revenues of the Company increased by 4.0% and amounted to 165.1 million euros, compared to 158.8 million euros in the corresponding period last year. The Life Sector contributed to this increase in production by 7.9%, the Car Sector by 0.6% and the Other General Sectors by 5.5%.
– Investment Income & Other Income amounted to 8.9 million euros, compared to 2.8 million euros in the corresponding period last year, recording an increase of 218.2%, positively affected by the increase in revenues by 3.9 million euros from the sale of financial data, compared to 30/09/2020.
– The Cost of Insurance Operations (Compensation of insured persons & Change of insurance provisions), amounted to 101.5 million euros, compared to 86.8 million euros in the corresponding period last year, recording an increase of 17.0%.
– The Company’s Profit before Taxes remained at high levels and amounted to 14.0 million euros, significantly improving the results of the first half by 133.3%.
– The number of staff of the Company amounted to 442 people, compared to 448 people on 30/09/2020.

In particular, the following table presents the basic financial figures of the Company for the nine months of 2021, in relation to the corresponding period of 2020:

Regarding the basic figures of the Balance Sheet, the following are noted:

– The Total Assets of the Company showed an increase of 1.3% and amounted to 516.6 million euros, compared to 509.7 million euros on 31/12/2020.
– The Investment Portfolio of the Company continued to be placed in highly rated securities and amounted to 426.7 million euros, compared to 412.5 million euros on 31/12/2020, showing an increase of 3.4%.
– Mathematical Inventories & Technical Forecasts amounted to 335.6 million euros, compared to 312.9 million euros on 31/12/2020, showing an increase of 7.3%.
– Equity amounted to 153.2 million euros, taking into account the Results for the Period of 10.9 million euros, as well as the distributed dividend for the year 2020 of 7.9 million euros, compared to 154.0 million euros on 31/12/2020, marking a marginal drop of 0.5%.
The above figures set the Return on Equity Ratio (ROE) at 13.5%.

European Credit AEGA continues to increase its share in the Greek Insurance Market, estimating that it now holds 5.9%. At the same time, the Company presents a growth rate of premiums of 4.0% in the first nine months of 2021, compared to the corresponding period of 2020.

Regarding the third quarter of 2021, the European Loyalty AEGA recorded significant dynamics both in terms of turnover and profitability.

More specifically, the third quarter (Q3) of 2021:

– The Registered Premiums and related revenues of the Company amounted to 54.1 million euros in Q3 2021, compared to 54.3 million euros in Q3 2020, showing a decrease of 0.4%. These results were mainly affected by the reduction of premium production of 3.0% in the Automotive Sector, which amounted to 24.9 million euros in Q3 2021, compared to 25.6 million euros in Q3 2020 and the increase in production premiums of the Other General Sectors as well as of the Life Sector, amounting to 5.1% and 0.1% respectively.
– Investment Income & Other Income amounted to 3.0 million euros, compared to 2.3 million euros in the corresponding period last year, recording an increase of 31.2%.
– Profits before Taxes recorded a high increase in the third quarter of 2021 amounting to 56.0% and amounted to 7.9 million euros compared to the corresponding period last year, where they amounted to 5.1 million euros.

Important events of the period: Nine months 2021

– Expansion of market share in the Life Sector, which is estimated at 3.9%, while in the Loss Sector it is estimated at 6.7%.
– Development of two new innovative products in the General Sectors and in the Group Life Insurance.
– Dividend distribution of € 0.30 per share, which was decided at the General Meeting of April 27, 2021. The dividend payment was completed on 11/05/2021.
– Election of a new Board of Directors fully harmonized with the New Legislation, N.4706 / 2020, for the Corporate Governance of companies listed on a regulated market.
– Inclusion of the Company in the new “Green” ESG index of the Athens Stock Exchange.
– Implementation of numerous Corporate and Social Responsibility actions (36 actions in the first nine months of 2021) in a period of health crisis and financial uncertainty, where the contribution was crucial.
– Successful completion of the Tele-Conferences, informative and educational, in which participated almost 2,000 Associates from the Sales Divisions of the Company.
– Award of the Company with a Bronze award for europaikipisti.gr at the Impact BITE Awards.
– Double distinction in the awards “The Golden Protagonists of the Greek Economy 2010 – 2020”.
– Distinction in the Bravo Sustainability Dialogues & Awards 2021, for the initiative “Prevention of Fraud & Fight against Corruption.
– Double distinction of the Company in the “Business Awards MONEY 2020”.

Pandemic impact assessment and prospects

For the event and the course of the Covid-19 pandemic, the Company has examined the financial and health impact. It is worth noting that according to the estimates of the Management, the data so far show that there has been no significant impact on the main financial figures of the Company for the year 2021 from the Covid-19 pandemic. For 2021, the goals remain as set in the Company’s Business Plan, as follows:
– Target to increase Net Production by 5.3% and maintain profitability at high levels.
– Target of acquisition costs of the Automotive Sector at levels less than 20.5%.
– Operating cost target as (%) Net Premiums <14%.
– Target of the Car Industry Loss Index <60%.
– Target of the Injury Index of Other General Sectors <35%.
– Target of the Injury Index of the Team Life Sector <70%.

During the outbreak of the pandemic, the Management of the European Credit Group immediately proceeded to activate the crisis management team, constantly examining the liquidity and the impact of Covid – 19 on the financial figures of the Group.

For the best preparation, sensitivity analyzes and stress tests are carried out at regular intervals on the Group’s financial figures, even in extreme scenarios. In all the above scenarios, both the Solvency Ratios and the liquidity remain at high levels, while the Group Management has planned a series of precautionary measures to address the potential risks.

It is important to mention that on 22/09/2021, the Company participated in the European stress test for the insurance industry, conducted by the European Insurance and Occupational Pensions Authority (EIOPA). This exercise focused on a prolonged Covid-19 scenario and a low interest rate environment for a longer period of time. The scenario, developed in collaboration with the European Systemic Risk Council (ESRB), aimed to assess the economic impact of the Covid-19 pandemic, which affects global confidence and prolongs economic contraction, as well as to assess both the impact on Equity as well as the liquidity position of companies in the scope.

Also, the Management systematically monitors the capital adequacy of the Company in accordance with Solvency II and takes the necessary actions to maintain a strong capital base and a high quality investment portfolio. Specifically, the SCR Solvency Index, on 30/09/2021, stood at 173.86%.

In addition to the impact of the pandemic, it is considered appropriate to report the following events that significantly affected the economic results in the first nine months of 2021:
– The increase in traffic on the roads as well as the number of damages, figures which have increased just after the removal of traffic restrictions. The above formed the Loss Index of the Automotive Industry on 30/09/2021 (annualized), increased by 5 p.m. compared to the corresponding period last year.
– Climate change and the multitude of natural phenomena. The extreme natural phenomena (fires) that broke out in August in areas of Northern Evia, North Attica, Ilia and in many other parts of the country, affected the insurance compensations of the Company by approximately 2.7 million euros, of which 0, Approximately 9 million euros relate to the participation of reinsurers.