Fourth quarter 2023 results - EUR 162 million net income in Q4
2023, contributing to a record full year 2023 net income of EUR 812
million Proposed regular dividend of EUR 1.8 per share
Press release6 March 2024 - N°
03
Fourth quarter 2023
results
EUR 162 million net income in Q4 2023,
contributing to a record full year 2023 net income
of EUR 812 million
Proposed regular dividend of EUR 1.8 per
share
- Group
net income of EUR 162 million in Q4 2023 (EUR 179 million
excluding the mark to market impact of the option on own shares).
For the full year 2023, the net income stands at EUR 812 million
(EUR 780 million adjusted1)
- Group
Economic Value2 under IFRS 17 of EUR 9.2
billion as of 31 December 2023, up +3.0%3 (+8.6% at constant
economics3,4) compared with 31 December 2022, implying an
Economic Value per share of EUR 51 (vs. EUR 50 as
of 31 December 2022)
-
Estimated Group solvency ratio of 209%5 as of 31
December 2023
- Proposed
regular dividend of EUR 1.8 per share for 2023
-
Annualized Return on Equity of 15.0% (16.6%
adjusted1) in Q4 2023. For the full year 2023, Return on Equity
stands at 18.1% (17.5% adjusted1)
-
Insurance revenue of EUR 3,832 million in Q4 2023
(+3.0%6 compared to Q4 2022)
- P&C
combined ratio of 75.6% in Q4 2023 (-22.8 pts compared to
Q4 2022)
- L&H
insurance service result7 of EUR 64 million in Q4 2023
(vs. EUR -463 million in Q4 2022)
- Investments regular income
yield of 3.7% in Q4 2023 (+0.6 pts compared to Q4
2022)
|
SCOR SE’s Board of Directors met on 5 March
2024, under the chairmanship of Fabrice Brégier, to approve the
Group’s 2023 financial statements.
Fabrice Brégier, Chairman of SCOR’s
Board of Directors, comments: “In 2023, SCOR delivers
record results, achieving its solvency target and exceeding its
value creation target. With the launch of its new strategic plan
Forward 2026, SCOR intends to fully benefit from the most
supportive P&C market environment of the past two decades. The
Group’s financial strength and business outlook have led the Board
to propose a regular dividend of EUR 1.8 per share for 2023,
subject to shareholders’ approval at the General Meeting. I am
confident in SCOR’s ability to pursue its profitable growth and
achieve the ambitious targets set out in its Forward 2026 strategic
plan.”
Thierry Léger, Chief
Executive Officer of SCOR, comments: “In 2023,
SCOR delivers a strong performance across all business activities,
with an Economic Value growth of 8.6% and a Solvency ratio of 209%.
SCOR’s balance sheet remains strong in 2023, with an increased
confidence level within the best estimate range in P&C
reserves. This is confirmed by an external independent review and
proves that the prudent reserving strategy we have adopted since
the second quarter of 2023 is bearing fruit. Looking ahead, our
objective is to continue to grow in selected lines of business, as
we did at the 1.1.2024 renewals. Building on this solid base and on
SCOR’s strong client relationships globally, we are hitting the
ground running for the Forward 2026 plan, with a firm commitment to
profitable growth.”
Group performance and
context
SCOR records EUR 162m net income (EUR 179
million adjusted1) in Q4 2023, driven notably by a strong P&C
performance and an increasing return on invested assets:
- In P&C
(re)insurance, the combined ratio of 75.6% in Q4 2023 is primarily
driven by a lower-than-expected natural catastrophe claims ratio of
1.5%, benefiting from positive developments in mature natural
catastrophe claims accounting for -7.2 points. In addition, P&C
(re)insurance benefited from a satisfactory underlying attritional
loss performance and a favorable discount effect.
- In L&H
reinsurance, the insurance service result7 stands at EUR 64 million
in Q4, impacted by a change in the CSM amortization pattern on a
full year basis, and by a negative onerous contract impact of EUR
50 million, mainly driven by a change in risk adjustment.
- In Investments,
SCOR benefits from high reinvestment rates and reports a noticeable
increase in the regular income yield, which reaches 3.7% in Q4 2023
(+0.3pts vs. Q3 2023).
- The effective
tax rate stands at 49.4% for Q4 2023, including the prudent actions
on the deferred tax assets.
Over the full year 2023, SCOR delivers a strong
performance with a net income of EUR 812 million (EUR 780 million
adjusted1), implying an annualized Return on Equity of 18.1% (17.5%
adjusted1). The Group grows its Economic Value by 8.6% at constant
economics3,4.
SCOR's Solvency ratio stands at 209% at year-end
2023, in the upper part of the optimal range of 185%-220%.
External independent review confirms
SCOR P&C reserves at best estimate
SCOR performed its annual P&C reserves
review in Q4 2023, setting all lines of its P&C reserves at
best estimate, with an increase in the confidence level compared to
Q4 2022.
In addition, Willis Towers Watson (WTW)
performed an external independent in-depth review covering 92.2% of
the gross held P&C reserves of EUR 9.3 billion. WTW confirmed
that “as at 30 September 2023, SCOR Group’s global P&C claim
reserves gross of retrocession are greater than WTW’s corresponding
best estimate” 8.
Proposed regular dividend of EUR 1.8 per
share, setting the floor for future years
Considering a strong performance delivered by
SCOR in 2023, as evidenced by the Solvency ratio of 209% and the
Economic Value growth of 8.6%3,4, SCOR proposes a regular dividend
of EUR 1.8 per share for the fiscal year 2023.
As per SCOR’s new capital management framework,
presented during the Investor Day on 7 September 2023, the regular
dividend for the current year is expected to be at a level at least
equal to that of the regular dividend for the previous year.
This dividend will be submitted for
shareholders’ approval at the 2024 Annual General Meeting, to be
held on 17 May 2024. The Board proposes to set the ex-dividend date
at 21 May 2024, and the payment date at 23 May 2024.
Very strong P&C underlying
performance in Q4 2023
In Q4 2023, P&C insurance revenue stands at
EUR 1,940 million, up +0.7% at constant exchange rates (down -3.9%
at current exchange rates) compared to Q4 2022. This slower growth
compared to Q3 2023 (+6.4% at constant exchange rates) is mainly
driven by a seasonality effect in Q4 due to a significantly higher
share of the 2023 underwriting year premiums in the business
mix.
As a reminder, insurance revenue is calculated
on an earned basis and reflects blended premiums from the 2023 and
2022 underwriting years. The contribution of the 2023 underwriting
year premiums to the mix increases quarter after quarter.
New business CSM in Q4 2023 stands at EUR -76
million, impacted by IFRS 17 stabilization measures from Q1 2023 of
EUR -153 million. Excluding these, the underlying new business CSM
of EUR 77 million in Q4 2023 comes mainly from Specialty
Insurance.
P&C (re)insurance key figures:
In EUR million (at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
P&C insurance revenue |
1,940 |
2,019 |
-3.9% |
7,496 |
7,371 |
1.7% |
P&C insurance service result |
353 |
27 |
1,215.5% |
897 |
-902 |
n.a. |
Combined ratio |
75.6% |
98.4% |
-22.8 pts |
85.0% |
114.9% |
-29.9 pts |
P&C new business CSM |
-76 |
n.a. |
n.a. |
952 |
n.a. |
n.a. |
The P&C combined ratio stands at 75.6% in Q4
2023, compared to 98.4% in Q4 2022. The combined ratio is improving
due to (i) a Nat Cat ratio at 1.5%, including -7.2 points related
to mature Nat Cat developments, mainly Hurricane Ian (excluding
these developments, the Cat ratio for Q4 2023 is better than
expected at 8.7%); and (ii) an attritional loss and commission
ratio of 79.3%, reflecting a good underlying performance, a
positive one-off technical income of -1.4 points, and a negative
impact from an IFRS 17 stabilization effect of 3.8 points.
The P&C attributable expense ratio stands at
6.4% of net insurance revenue in Q4 2023.
The P&C insurance service result of EUR 353
million is driven by a CSM amortization of EUR 252 million, a risk
adjustment release of EUR 49 million, a positive experience
variance of EUR 64 million which is primarily driven by mature Nat
Cat developments, and an onerous contract impact of EUR -12
million.
Good L&H underlying performance in
Q4 2023
In Q4 2023, L&H insurance revenue amounts to
EUR 1,892 million, up +5.4% at constant exchange rates (stable at
current exchange rates) compared to Q4 2022.
SCOR continues to build its L&H CSM through
new business generation, mostly from Protection (EUR 90 million new
business CSM9 in Q4 2023, including EUR 75 million from
Protection).
L&H reinsurance key figures:
In EUR million(at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
L&H insurance revenue |
1,892 |
1,892 |
0.0% |
8,426 |
8,539 |
-1.3% |
L&H insurance service result7 |
64 |
-463 |
n.a. |
589 |
-316 |
n.a. |
L&H new business CSM9 |
90 |
n.a. |
n.a. |
466 |
n.a. |
n.a. |
The L&H insurance service result7 amounts to
EUR 64 million in Q4 2023. It is negatively impacted by a change in
the CSM amortization pattern on a full year basis, and by an
onerous contract impact of EUR -50 million mainly from changes in
risk adjustment, with negligible contribution from new
business.
Investments continue to deliver
favorable results with a regular income yield of 3.7% in Q4
2023
As of 31 December 2023, total invested assets
amount to EUR 22.9 billion. SCOR’s asset mix is optimized, with 79%
of the portfolio invested in fixed income. SCOR has a high-quality
fixed income portfolio with an average rating of A+ and a duration
of 3.0 years.
Investments key figures:
In EUR million (at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
Total invested assets |
22,914 |
22,179 |
+3.3% |
22,914 |
22,179 |
+3.3% |
Regular income yield* |
3.7% |
3.1% |
+0.6 pts |
3.2% |
2.4% |
+0.8 pts |
Return on invested assets*, ** |
3.7% |
2.9% |
+0.8 pts |
3.2% |
2.1% |
+1.1 pts |
(*) Annualized. (**) Fair value through income
on invested assets excludes EUR -22 million in Q4 2023 and EUR 43
million in FY 2023 pre-tax mark to market impact of the fair value
of the option on own shares granted to SCOR.
Total investment income on invested assets
stands at EUR 20610 million in Q4 2023. The return on invested
assets stands at 3.7%10 (vs. 3.4% in Q3 2023) and the regular
income yield at 3.7% (vs. 3.4% in Q3 2023).
The reinvestment rate stands at 4.5%11 as of 31
December 2023, compared to 5.4% at 30 September 2023. The invested
assets portfolio remains highly liquid and financial cash flows of
EUR 10.2 billion are expected over the next 24 months12, enabling
SCOR to continue to benefit from still-elevated reinvestment
rates.
*
*
*
APPENDIX
1 - SCOR Group FY 2023 and Q4 2023 key
financial details
In EUR million (at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
Insurance revenue |
3,832 |
3,911 |
-2.0% |
15,922 |
15,910 |
+0.1% |
Gross written premiums1 |
4,927 |
4,905 |
+0.5% |
19,371 |
19,732 |
-1.8% |
Insurance Service Result2 |
417 |
-436 |
n.a. |
1,486 |
-1,218 |
n.a. |
Group management expense ratio |
7.9% |
7.2% |
+0.7 pts |
6.9% |
6.7% |
+0.2 pts |
Annualized ROE3 |
15.0% |
n.a. |
n.a. |
18.1% |
n.a. |
n.a. |
Annualized ROE assuming a constant mark to market impact of the
option on own shares |
16.6% |
n.a. |
n.a. |
17.5% |
n.a. |
n.a. |
Net income3,4 |
162 |
-356 |
n.a. |
812 |
-1,383 |
n.a. |
Net income assuming a constant mark to market impact of the option
on own shares |
179 |
n.a. |
n.a. |
780 |
n.a. |
n.a. |
Economic value5,6 |
9,213 |
8,947 |
3.0% |
9,213 |
8,947 |
3.0% |
Shareholders’ equity |
4,723 |
4,351 |
8.6% |
4,723 |
4,351 |
8.6% |
Contractual Service Margin (CSM)6 |
4,490 |
4,596 |
-2.3% |
4,490 |
4,596 |
-2.3% |
1: GWP is not a metric defined under the IFRS 17 accounting
framework (non-GAAP metric); 2: Includes revenues on financial
contracts reported under IFRS 9; 3: Taking into account the mark to
the market impact of the option on own shares. Q4 2023 impact of
EUR -22 million before tax. FY 2023 impact of EUR 43 million before
tax. 4: Consolidated net income, Group share; 5. Defined as the sum
of the shareholder’s equity and the Contractual Service Margin
(CSM); 6: Net of tax. A notional tax rate of 25% is applied to the
CSM.
2 - P&L key figures FY 2023 and Q4 2023
In EUR million (at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
Insurance revenue |
3,832 |
3,911 |
-2.0% |
15,922 |
15,910 |
+0.1% |
|
1,940 |
2,019 |
-3.9% |
7,496 |
7,371 |
+1.7% |
|
1,892 |
1,892 |
0.0% |
8,426 |
8,539 |
-1.3% |
Gross written premiums1 |
4,927 |
4,905 |
+0.5% |
19,371 |
19,732 |
-1.8% |
- P&C gross written premiums
|
2,362 |
2,554 |
-7.5% |
9,452 |
10,017 |
-5.6% |
- L&H gross written premiums
|
2,565 |
2,351 |
+9.1% |
9,919 |
9,715 |
+2.1% |
Investment income on invested assets |
206 |
162 |
+27.3% |
711 |
467 |
+52.1% |
Operating results |
350 |
-498 |
n.a. |
1,366 |
-1,567 |
n.a. |
Net income2,3 |
162 |
-356 |
n.a. |
812 |
-1,383 |
n.a. |
Net income assuming a constant valuation of the option on
own shares |
179 |
n.a. |
n.a. |
780 |
n.a. |
n.a. |
Earnings per share3
(EUR) |
0.91 |
-1.99 |
n.a. |
4.54 |
-7.76 |
n.a. |
Earnings per share (EUR) assuming a constant valuation of
the option on own shares |
1.00 |
n.a. |
n.a. |
4.35 |
n.a. |
n.a. |
Operating cash flow |
588 |
446 |
+31.8% |
1,480 |
500 |
+196.0% |
1: GWP is not a metric defined under the IFRS 17 accounting
framework (non-GAAP metric); 2: Consolidated net income, Group
share; 3: Taking into account the mark to the market impact of the
option on own shares. Q4 2023 impact of EUR -22 million before tax.
FY 2023 impact of EUR 43 million before tax.
3 - P&L key ratios FY 2023 and Q4 2023
In EUR million (at current exchange rates) |
Q4 2023 |
Q4 2022 |
Variation |
FY 2023 |
FY 2022 |
Variation |
Return on invested assets
1,2 |
3.7% |
2.9% |
+0.8 pts |
3.2% |
2.1% |
+1.1 pts |
P&C combined ratio 3 |
75.6% |
98.4% |
-22.8 pts |
85.0% |
114.9% |
-29.9 pts |
Group management expense
ratio4 |
7.9% |
7.2% |
+0.7 pts |
6.9% |
6.7% |
+0.2 pts |
Annualized ROE5 |
15.0% |
n.a. |
n.a. |
18.1% |
n.a. |
n.a. |
Annualized ROE excluding the mark to market impact of the
option on own shares |
16.6% |
n.a. |
n.a. |
17.5% |
n.a. |
n.a. |
Economic Value growth6 |
n.a. |
n.a. |
n.a. |
8.6% |
n.a. |
n.a. |
1: Annualized and calculated excluding funds
withheld by cedants according to IFRS 9 standard; 2: In Q4 2023 and
FY 2023, fair value through income on invested assets excludes EUR
-22m and EUR 43m pre-tax mark to market impact of the fair value of
the option on own shares granted to SCOR; 3: The combined ratio is
the sum of the total claims, the total variables commissions, and
the total P&C management expenses, divided by the net insurance
revenue for P&C business; 4: The Group management expense ratio
is the total management expenses divided by the insurance revenue;
5: Taking into account the mark to the market impact of the option
on own shares. Q4 2023 impact of EUR -22 million before tax. FY
2023 impact of EUR 43 million before tax; 6: Growth at constant
economic assumptions of interest and exchange rates, excluding the
mark to market impact of the option on own shares and the effect of
its partial derecognition. The starting point is adjusted for the
payment of dividend of EUR 1.40 per share (EUR 254 million in
total) for the fiscal year 2022, paid in 2023. Economic Value
defined as the sum of the shareholders’ equity and the Contractual
Service Margin (CSM), net of tax. A notional tax rate of 25% is
applied to the CSM.
4 - Balance sheet key figures as of 31 December
2023
In EUR million (at current exchange rates) |
As of31 December 2023 |
As of31 December 2022 |
Variation |
Total invested assets 1 |
22,914 |
22,179 |
+3.3% |
Shareholders’ equity |
4,723 |
4,351 |
+8.6% |
Book value per share (EUR) |
26.16 |
24.11 |
+8.5% |
Economic Value2 |
9,213 |
8,947 |
+3.0% |
Economic Value per share
(EUR)3 |
51.18 |
49.77 |
+2.8% |
Financial leverage ratio |
21.2% |
21.6% |
-0.4 pts |
Total liquidity4 |
2,234 |
2,791 |
-19.9% |
1: Excluding 3rd party net insurance business
investments; 2: The Economic Value (defined as the sum of the
shareholders’ equity and the Contractual Service Margin (CSM), net
of tax) includes minority interests; 3: The Economic Value per
share excludes minority interests; 4: Includes cash and cash
equivalents and short-term investments.
*
*
*
SCOR, a leading global reinsurer As a leading
global reinsurer, SCOR offers its clients a diversified and
innovative range of reinsurance and insurance solutions and
services to control and manage risk. Applying “The Art &
Science of Risk”, SCOR uses its industry-recognized expertise and
cutting-edge financial solutions to serve its clients and
contribute to the welfare and resilience of society. The
Group generated premiums of EUR 19.4 billion in 2023 and serves
clients in a large number of countries from its 35 offices
worldwide. For more information, visit:
www.scor.com |
Media Relations Alexandre
Garciamedia@scor.com Investor
RelationsThomas
Fossardtfossard@scor.com Follow us on
LinkedIn |
All
content published by the SCOR group since January 1, 2024, is
certified with Wiztrust. You can check the authenticity of this
content at wiztrust.com. |
General
Numbers presented throughout this press release
may not add up precisely to the totals in the tables and text.
Percentages and percent changes are calculated on complete figures
(including decimals); therefore, the press release might contain
immaterial differences in sums and percentages due to rounding.
Unless otherwise specified, the sources for the business ranking
and market positions are internal.
Forward-looking statements
This press release includes forward-looking
statements, assumptions, and information about SCOR’s financial
condition, results, business, strategy, plans and objectives,
including in relation to SCOR’s current or future projects.
These statements are sometimes identified by the
use of the future tense or conditional mode, or terms such as
“estimate”, “believe”, “anticipate”, “expect”, “have the
objective”, “intend to”, “plan”, “result in”, “should”, and other
similar expressions.
It should be noted that the achievement of these
objectives, forward-looking statements, assumptions and information
is dependent on circumstances and facts that arise in the
future.
No guarantee can be given regarding the
achievement of these forward-looking statements, assumptions and
information. These forward-looking statements, assumptions and
information are not guarantees of future performance.
Forward-looking statements, assumptions and information (including
on objectives) may be impacted by known or unknown risks,
identified or unidentified uncertainties and other factors that may
significantly alter the future results, performance and
accomplishments planned or expected by SCOR.
In particular, it should be noted that the full
impact of the inflation and geopolitical risks including but not
limited to the Russian invasion and war in Ukraine on SCOR’s
business and results cannot be accurately assessed.
Therefore, any assessments, any assumptions and,
more generally, any figures presented in this press release will
necessarily be estimates based on evolving analyses, and encompass
a wide range of theoretical hypotheses, which are highly
evolutive.
These points of attention on forward-looking
statements are all the more essential that the adoption of IFRS 17,
which is a new accounting standard, results in significant
accounting changes for SCOR.
Information regarding risks and uncertainties
that may affect SCOR’s business is set forth in the 2022 Universal
Registration Document filed on 14 April 2023, under number
D.23-0287 with the French Autorité des marchés financiers (AMF)
posted on SCOR’s website www.scor.com.
In addition, such forward-looking statements,
assumptions and information are not “profit forecasts” within the
meaning of Article 1 of Commission Delegated Regulation (EU)
2019/980.
SCOR has no intention and does not undertake to
complete, update, revise or change these forward-looking
statements, assumptions and information, whether as a result of new
information, future events or otherwise.
Financial information
The Group’s financial information contained in
this press release is prepared on the basis of IFRS and
interpretations issued and approved by the European Union.
Unless otherwise specified, prior-year balance
sheet, income statement items and ratios have not been
reclassified.
The calculation of financial ratios (such as
economic value per share, return on invested assets, regular income
yield, management expenses ratio, return on equity and combined
ratio) is detailed in the Appendices of the presentation related to
the financial results of Q4 2023 (see page 32).
. The financial results for the full year 2023
included in this press release have been audited by SCOR’s
statutory auditors.
Unless otherwise specified, all figures are
presented in Euros. All figures are at constant exchange rates as
of December 31, 2023 unless otherwise specified.
Any figures for a period subsequent to December
31, 2023 should not be taken as a forecast of the expected
financials for these periods.
The solvency ratio is not audited by the
Company’s statutory auditors. The Group solvency final results are
to be filed to supervisory authorities by April 2024 and may differ
from the estimates expressed or implied in this report.
1 Excluding the mark to market impact of the option on own
shares.
2 Defined as the sum of the shareholders’ equity
and the Contractual Service Margin (CSM), net of tax. 25% notional
tax rate applied on CSM.3 The starting point is adjusted for the
payment of dividend of EUR 1.40 per share (EUR 254 million in
total) for the fiscal year 2022, paid in 2023.4 Growth at constant
economic assumptions of interest and exchange rates, excluding the
mark to market impact of the option on own shares and the effect of
its partial derecognition.
5 Solvency ratio estimated after taking into
account the proposed dividend of EUR 1.8 per share for the fiscal
year 2023. 6 At
constant exchange rates.7 Includes revenues on financial contracts
reported under IFRS 9.8 The details on the reserve review by WTW
are included in the in the Appendices of the presentation related
to the financial results of Q4 2023 (see page 54)9 Includes the CSM
on new treaties and change in CSM on existing treaties due to new
business (i.e. new business on existing contracts).10 Excluding the
mark to the market impact of the option on own shares. Q4 2023
impact of EUR -22 million before tax
11 Reinvestment rate is based on Q4 2023 asset
allocation of yielding asset classes (i.e. fixed income, loans and
real estate), according to current reinvestment duration
assumptions. Yield curves & spreads as of
31/12/2023.12 As of 31 December 2023. Includes current
cash balances and future coupons and redemptions.
Scor (EU:SCR)
Graphique Historique de l'Action
De Mai 2024 à Juin 2024
Scor (EU:SCR)
Graphique Historique de l'Action
De Juin 2023 à Juin 2024