Vienna Insurance Group reports net profit of 231 million Euro, down by 30 percent in 2020

VIG Group’s business development was affected by the pandemic, various lockdowns and exceptional regulations. The growth achieved in the first two months of 2020 compensated for the decrease in new business during the initial strict lockdown periods.

Profit before taxes of 346 million Euro was at the upper end of the announced range of 300 to 350 million Euro and around one third lower than the result achieved in the previous year. The result also includes goodwill impairments of around 120 million Euro for the Bulgarian, Croatian and Georgian markets at the end of the first half of 2020, resulting from the event-driven goodwill impairment test performed on 30 June 2020 in connection with COVID-19.

The net result amounted to 231.5 million Euro, 30% lower than in the previous year. The drop was due to a decline in the financial result, which mainly decreased due to COVID-19 and the resulting impairments, as well as an associated reduction in current income from investments.

 “With its preliminary results for 2020, VIG Group more than lives up to its claim of being a stable and reliable partner, even in a time of great challenges. Although the COVID-19 situation affected our business development almost throughout the financial year 2020, VIG Group nevertheless achieved an overall very stable operative performance and continued to consistently implement the measures planned for the final year of ‘Agenda 2020’. During the pandemic, we particularly focused on expanding the range of digital products and services. With the acquisition of Aegon’s Eastern European business, we took an important step in expanding our market leadership in the CEE region, even during this exceptional global situation,” explains CEO Elisabeth Stadler.

“Premiums increased to EUR 10.43 billion. With profit before taxes of EUR 346 million, we managed to reach the upper end of the announced profit range of EUR 300 to 350 million for 2020. This figure also includes goodwill impairments of around EUR 120 million. The combined ratio was further improved to 95%, which means our goal of moving the combined ratio towards 95% has been achieved. We will continue to focus on optimising our cost structure. Despite the turbulent times, we achieved very solid results and a stable operative performance. The ongoing pandemic makes it difficult to forecast the future development,” Stadler comments on the key figures.

“Based on current developments, we expect premium volume in 2021 to remain stable at the level of 2020. We aim for a profit before taxes for 2021 in the range of EUR 450 million to 500 million, which means a return to the pre-crisis level. We are proposing a dividend of 75 cents per share. This corresponds to a dividend payout ratio of 41.5%, which is in line with our dividend policy,” explains CEO Elisabeth Stadler.