French reinsurer SCOR Group posted a significant gain in net income for 2007 – up 62 percent to €407 million, ($632.8 million), a ROE of 14.1 percent and a strong 2007 EPS reaching € 2.79 ($4.337), supported by a net operating cash flow of €611 million ($949 million), the highest in the history of the company.
SCOR’s report also listed the following earnings highlights:
— On a pro-forma basis, consolidating Converium since 1 January 2007, net income reached €450 million [$699 million] for 2007, up 79 percent compared to 2006.
— Very strong top-line performance supported by acquisitions. On a published basis, SCOR recorded a premium increase of 62 percent to €4.762 billion [$7.4 billion]. 2007 pro-forma gross written premiums stand at €5.853 billion [$9.09 billion], an increase of 100 percent compared to 2006.
— Strong profit contribution from both business engines: on a published basis Non-Life recorded a combined ratio of 97.3 percent and Life an operating margin of 7.6 percent. The respective pro-forma figures are 99.3 percent and 7.7 percent.
— On the basis of the published accounts, the prudent asset management strategy delivers a stable return of 4.4 percent on a total investment portfolio of €19.1 billion [$29.687 billion] (4.3 percent for pro-forma).
— Very efficient Enterprise Risk Management (ERM) process applied to protect the whole organization. No direct liability risks from monoline companies or subprime. Very limited risks from monoliner credit-enhanced securities (0.42 percent of total invested assets) and subprime investments (0.27 percent of total invested assets).
— Confirmed pre-tax annual synergy targets of €68 million [$105.7 million] by 2009, €51 million [$79.3 million] already identified (run-rate basis).
— Shareholder equity reaches €3.629 billion [$5.64 billion] (published accounts as of 31 December 2007) including minorities. Book value per share stands at €20.0 [$31.00]. No financing is necessary to support current rating.
— Proposed dividend of €0.80 [$1.243] per share subject to the approval of the Annual General Meeting, representing a pay-out ratio of nearly 36.2 percent.
Chairman and CEO Denis Kessler commented: “The Group had a very strong year in 2007 and posted record numbers in terms of profits and shareholder returns. SCOR entered a new global dimension and is adequately positioned to further develop its diverse book. All business drivers are performing strongly and have contributed to these results. Profiting from the new innovative ‘Hub’ structure, the Group will further solidify its leading role in the reinsurance sector.
“Very satisfying January 2008 renewals demonstrate the depth of the franchise of the new Group. With an Enterprise Risk Management culture firmly in place, the Group’s assets have been managed very prudently. For this reason, the Group only saw marginal exposure to the subprime and monoliner crisis. SCOR can thus continue to implement the strategy outlined in the three-year stategic plan ‘Dynamic Lift V2’.
“With a close eye on the evolution of a difficult environment, we are convinced that the Group meets all the conditions required to reach its medium-term objectives, not least because of the expected synergies.”
The complete report and additional information may be obtained ion the Group’s web site at: www.scor.com.
Source: SCOR Group
Topics Profit Loss
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