Generali Holding Vienna AG

euro adhoc: Generali Holding Vienna AG
Quarterly or Semiannual Financial Statements
Generali: Doubling of Profit from Ordinary Activities in Sight

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Generali Vienna Group reports sharp increase in profit from ordinary activities during the first three quarters of 2004. Central and Eastern Europe already accounts for nearly 27 per cent of premium income.

The Generali Vienna Group nearly tripled its profit from ordinary activities during the first three quarters of 2004. The group, which operates under the umbrella of listed parent Generali Holding Vienna AG (the only insurance enterprise listed in the Vienna stock exchange's ATX index), reported an increase in profit from ordinary activities to EUR 87.6 million. That compares with EUR 30.1 million in the first nine months of 2003. CFO Walter Steidl is delighted: "As things stand at the moment, we can already say with considerable confidence that our full-year profit from ordinary activities will show growth of over 100 per cent." Profit from ordinary activities came to EUR 42.1 million in 2003. That impressive result is based on calculations in conformity with the accounting standards laid down in Austria's HGB (commercial code) applying the strengen Niederstwertprinzip (strict lower-of-cost-and-market principle). Application of that principle prohibits write-ups that would be permissible under IAS. If the capital markets hold steady, as things stand at the moment, the consolidated annual financial statements drawn up in conformity with the International Accounting Standards will show a significantly higher profit from ordinary activities. There was also a marked improvement in the combined ratio of this financial service provider, which operates in Austria and seven countries in Central and Eastern Europe, as it fell sharply from 98.5 to 92.1 percent. Net of reinsurance business, Generali's premium income grew by 3.9 per cent to EUR 1.97 billion. Its biggest segment was property/casualty insurance, where premium income grew by 4.9 per cent to EUR 1.38 billion. Premium income in the health insurance segment increased by 1.5 per cent to EUR 130.8 million. In the life insurance segment, Generali achieved satisfactory rates of growth in the unit-linked and in the classical life insurance lines. Unit-linked life insurance business showed an impressive comeback, growing by 32.1 per cent to EUR 33.2 million. Premium income from classical recurring-premium life insurance business came to EUR 384.9 million, or 5.1 per cent more than in the first three quarters of 2003.  Generali remained very restrained in the single-premium segment, resulting in overall growth in its premium income from life insurance business of 1.3 per cent to EUR 455.3 million. Including the savings premium for unit-linked life insurance policies (excluded under IAS), the overall figure increased by 7.4 per cent to EUR 557.9 million. Consolidated premium income during the first three quarters grew by 1.9 per cent to EUR 2.05 billion. With the savings premium for unit-linked life insurance policies of EUR 102.6 million, it grew by 3.4 per cent.

Central and Eastern European markets continue to drive growth Geographically, the group's growth continued to be driven by its seven markets in Central and Eastern Europe (Hungary, the Czech Republic, Poland, Slovakia, Slovenia, Romania and Croatia), which already account for 26.7 per cent of its aggregate premium income. Overall growth in Central and Eastern Europe jumped by 16.7 per cent to EUR 525.2 million, whereas premium income from primary insurance business in the group's Austrian home market was nearly static on the year at EUR 1,45 billion (decline of 0.1 per cent). Including the savings premium for unit-linked life insurance policies, premium income from primary insurance business grew in the CEE countries by 0.9 per cent to EUR 1.50 billion.

Claims and benefits during the first three quarters grew by just 1.9 per cent to EUR 1.50 billion. There was a drop in claims in the property/casualty insurance segment by 5.7 per cent, reflecting the success of the group's uncompromising corporate fitness programme. Outpayments in the life insurance segment increased by 16.4 per cent.

In the nine months ended 30 September 2004, the Group's consolidated investments grew by 5.2 per cent to EUR 8.71 billion. As in the first half of 2004, the fastest growing category in percentage terms was shares and other non-fixed-interest securities, whose holdings grew by 16.8 per cent or EUR 165.9 million. The group's workforce was unchanged versus mid-2004 at 10,064. Generali remains one of the biggest employers in the Austrian financial services industry.

The Generali Vienna Group is forecasting full-year premium growth of 2.1 per cent to EUR 2.6 billion. As things stand at the moment, the group's results should enable it to continue to increase its own funds and to declare the same dividend to the shareholders of Generali Holding Vienna AG as last year. The previous year's distribution (dividend plus bonus) was EUR 0.25 per share.

end of announcement                                euro adhoc 24.11.2004 14:03:51
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Further inquiry note: Generali  Holding Vienna AG Josef Hlinka Tel.: (++43-1) 534 01-1375 Fax: (++43-1) 534 01-1593 mailto:josef.hlinka@generali.at http://www.generali-holding.at

Branche: Insurance
ISIN:      AT0000661350
WKN:        066135
Index:    WBI, ATX Prime, ATX
Börsen:  Berliner Wertpapierbörse / free trade
              Hamburger Wertpapierbörse / free trade
              Frankfurter Wertpapierbörse / free trade
              Baden-Württembergische Wertpapierbörse / free trade
              Bayerische Börse / free trade
              Wiener Börse AG / official dealing



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