PARIS, Sept. 6, 2001 (PRIMEZONE) -- SCOR, semi-annual results.
"The first half of 2001 for SCOR was marked by further substantial improvements in pricing conditions and by a strong increase in premium income. These trends were particularly pronounced for Life, Accident & Health Reinsurance (+77%) and Large Corporate Accounts business (+99%), and the overall balance of our business mix has been maintained. The acquisition of Sorema in the first half of the year took effect on July 1, 2001. This transaction, which was completed at the most opportune point in the cycle, has strengthened the Group's resources and will enable us to pursue our strategy of profitable and well-balanced growth in an improved technical environment," stated Jacques Blondeau, Chairman and Chief Executive Officer.
EUR million 6/30 6/30 Change 12/31
2000 2001 2000
Gross written
Premiums 1,544 2,361 + 53% 3,458
EBITDA** 17 99 x 5,8 116
Operating results* 6 82 x 13,7 92
Group net income* 36 55 + 53% 111
NAV per share
(euros)* 50.2 50.3 -- 52.4
* According to new accounting methods
** Earnings before Interest, Taxes, Depreciation and Amortization
Strong Growth for the 3 Main Divisions
SCOR registered growth of 53% in premium income, which reached EUR 2,361 million.
In Property & Casualty Reinsurance the market has been characterized by sharp rate increases. Gross premiums were up 48%, bolstered both by the development of our existing portfolio and the underwriting of new business at higher prices.
Growth of 77% for Life, A&H Reinsurance, is mainly the result of the underwriting of major new life insurance and financing contracts and the expansion of SCOR Life Re, which was not consolidated in the first half of 2000.
The 38% rise in Specialty Reinsurance was attributable mainly to large corporate accounts underwritten by SCOR Business Solutions (+ 99%) and to the Credit & Surety business (+ 31%).
Premium income generated by Commercial Risk Partners, a subsidiary of the Group that specializes in Non-Traditional (ART) Reinsurance, stabilized (+ 5%) after five years of vigorous growth.
Marked Improvement in EBITDA and Rise in Group Net Income
EBITDA for the first half of 2001, at EUR 99 million, compares to EUR 17 million in the first half of 2000. This improvement of EUR 82 million is essentially the result of the sharp fall in the combined ratio for Property & Casualty Reinsurance, which reduced from 148% in the first half of 2000 to 110% at the end of June 2001. The combined ratio for Specialty Reinsurance, at 106.7% at the end of June 2001, remained stable despite the frequency of claims in Large Corporate Accounts. Overall, the Group's combined ratio (excluding Life, Accident & Health Reinsurance) registered a significant improvement, standing at 106.8% for the first half of 2001 compared to 125.9% for the first half of 2000.
The Asset Management activity was characterized by a strong increase in income from ordinary investment, totaling EUR 214 million for the first half of 2001 compared to EUR 140 million at the end of June 2000 (up 53%), and by a sharp reduction in realized capital gains on equity investments, linked to stock market trends over the first half of the year.
Consolidated Group net income reached EUR 55 million (EPS of EUR 1.60), up 53% on the first half of 2000 (EUR 36 million) when adjusted for changes in the accounting methods.
Technical reserves stood at EUR 9,053 million (compared with EUR 6,566 million at June 30, 2000) and the market value of assets under management rose by 6.7% over the first six months (27% over twelve months) to EUR 8,645 million, despite a fall in unrealized capital gains of EUR 166 million since the beginning of the year.
The Extraordinary Shareholders' Meeting, which was held on July 31, 2001, approved the acquisition of all the shares of Sorema SA and Sorema NA. In exchange, SCOR issued 6,370,370 new shares valued at EUR 54 each. This operation increased SCOR shareholders' equity by EUR 344 million.
The intrinsic share value at June 30, 2001 stood at EUR 85.4 for a stock market price at the end of June of EUR 52.5.
Outlook
The consolidation of Sorema in the second half of 2001 enables the Group to strengthen its capital base, improve its solvency and reinforce its position as one of the world's leading reinsurers.
Over the current financial year, the Group, based on the current upturn of conditions in the reinsurance market, forecasts a considerable improvement in written premiums and operating income. Return on equity should exceed 10%.
Certain statements contained in this press release are forward-looking statements that are based on risks and uncertainties that could cause actual results, performance or events to differ materially from those in such statements. Additional information regarding risks and uncertainties is set forth in the current annual report of the company.
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