Sava RE: 2017 plans delivered, now looking upon ambitious 2018.
Sava RE reported GWP of EUR 517.2m. This is an increase of 5.5% vs 2016 with growth reported across the board segment and country wise. Even reinsurance market picked up and delivered 3.8% YoY growth. Claims however were also up, internationally and domestically and this has burdened profitability and balanced strong top line growth. Namely gross claims paid increased by 14.9% while net claims incurred increased by 10.3% YoY. Consequently combined ratio stood at 95.5% and has deteriorated by 0.9 p.p despite better expense ratio due to mentioned higher claims. Net profit of EUR 31.1m was achieved (ROE of 10.1%), in-line with Sava RE guidance and even above our estimates. In addition, their plan is looking ambitious as they have ranged profit at EUR 37m to EUR 39m for 2018. While we will adjust our valuations only after annual reports of Triglav and Sava RE are known (scheduled for the beginning of April), we will till then also stick with our buy recommendation based on current valuations which show undervaluation to Triglav which also has a buy rating.
Pozavarovalnica Sava dd (or Sava Reinsurance Plc), also known as Sava Re dd, is a Slovenia-based reinsurance undertaking. It operates as a parent company of Sava Re Group, which comprises direct insurance and pension undertakings. The Company's activities are divided into four segments: Reinsurance operations, Non-life insurance operations, Life insurance operations and Other business segment. The Reinsurance operations segment comprises treaty and facultative arrangements for intra-group clients and insurance and reinsurance partners worldwide. The Non-life insurance operations segment supports local markets with non-life insurance products and customer oriented services. The Life insurance operations segment is focused on life protection and saving products, including pension schemes. The Other business segment comprises operations of the Company's non-insurance subsidiaries. Sava Re Group operates through subsidiaries in Slovenia, Croatia, Serbia, Macedonia, Montenegro and Kosovo.
ALTA Invest, investicijske storitve, d.d., (ALTA Invest, investment services, Inc.) is a part of ALTA Group, the biggest financial non-banking group in Slovenia. ALTA Invest has around 28% market share on the domestic Ljubljana Stock Exchange and has more than EUR 95m of assets under management.
Our trading advantage is our execution of large trading blocks with low impact on the market. We offer trading on several platforms on numerous markets, with a wide variety of financial instruments. Our advantage is also a research department, which is both sell side and buy side and has the far most extensive and regular coverage of domestic companies. We cover 9 companies on Ljubljana Stock Exchange, which is around 90% of Mcap on LJSE – and here we are practically the only local broker providing this kind of extensive and regular coverage for Slovenian companies.
A part of ALTA Group are ALTA Skladi, a mutual fund asset management company with roughly EUR 260m of asset under management. ALTA Group is also extensively involved in corporate finance projects and raised considerable assets (fixed income and equity) in the last two years for several companies.
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