Donald J. Shepard. Chairman Executive Board AEGON N.V. Voorzitter Raad van Bestuur AEGON N.V. Annual General Meeting of Shareholders April 25,

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Transcription:

Donald J. Shepard Chairman Executive Board AEGON N.V. Voorzitter Raad van Bestuur AEGON N.V. Annual General Meeting of Shareholders April 25, 2006 1

Good Progress in 2005 Strong financial performance Improved position in AEGON s three major markets Expansion strategy on track Annual General Meeting of Shareholders April 25, 2006 2

Strong Financial Performance Operating earnings before tax increased 21% to EUR 2,147 million Net income increased 21% to EUR 2,732 million New life sales increased 9% for the year to EUR 2,539 million Strong capital base and cash flow generation Annual General Meeting of Shareholders April 25, 2006 3

Strong financial performance Improved position in AEGON s three major markets Expansion strategy on track Annual General Meeting of Shareholders April 25, 2006 4

Americas New Life Sales 1,400 1,200 1,000 800 600 400 Standardized new life sales (in USD mln) +7% BOLI/COLI Reinsurance Retail 200 0 2004 2005 US new life sales increased 7%, driven in particular by strong reinsurance sales, which were up 46% Continue to focus on improving returns in a challenging environment Annual General Meeting of Shareholders April 25, 2006 5

Growth within AEGON USA s Pension Group (in USD mln) Pension Group assets 45,000 40,000 2002 2005 : CAGR of 21% 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 1996 1997 1998 1999 2000 2001 2002 24,570 43,798* 2003 2004 2005 Diversified Investment Advisors Transamerica Retirement Services *Excludes purchased annuities at TRS Total Retirement Assets under Management Pension Group AEGON Institutional Markets Other qualified annuities Total USD 43.8 billion USD 3.4 billion USD 14.4 billion USD 61.6 billion Annual General Meeting of Shareholders April 25, 2006 6

Developments in AEGON The Netherlands Unique group pension capability in all three key areas: administration, insured pension solutions and asset management New Levensloop (Lifecycle) product successfully introduced Administrative performance improved considerably Successfully developed new disability products (WIA) AEGON Asset Management wins 4 first prize S&P Awards and 3 first prize Lipper Awards for consistent performance Annual General Meeting of Shareholders April 25, 2006 7

Strengthening AEGON UK s IFA channel 1400 Advisor Headcount (RI) 1200 1000 800 600 400 200 0 2000 2001 2002 2003 2004 2005 Positive Solutions is a national IFA that provides management services to Registered Individuals (RI) through an e-platform Accelerated acquisition of remaining 40% of Positive Solutions Number of Registered Individuals more than doubled since initial investment in late 2002 Average productivity has increased markedly Annual General Meeting of Shareholders April 25, 2006 8

AEGON UK Product Mix 2002 2005 3% 8% 12% 9% 9% 51% 11% 45% 29% 23% Group Pensions Individual Pensions Bonds Annuities Risk AEGON UK has continued to see a favourable change in product mix with higher margin business up from 20% in 2002 to 32% in 2005 Annual General Meeting of Shareholders April 25, 2006 9

Strong financial performance Improved position in AEGON s three major markets Expansion strategy on track Annual General Meeting of Shareholders April 25, 2006 10

AEGON present in larger Eastern European markets Life and pensions premiums USD million Market growth 1999-2004 Percent Russia 3,544 16% Poland Czech Republic Poland Czech Republic Hungary Slovakia 603 Hungary Slovakia 603 Slovenia 531 Croatia 260 Romania 251 Bulgaria 64 Ukraine 29 2,828 12 1,720 20 1,179 11 13 21 17 24 43 55 Source: Swiss Re Annual General Meeting of Shareholders April 25, 2006 11

Developments in Other Countries Central & Eastern Europe Strong growth potential for life and pension products with over 65 million people in AEGON CEE countries Improvements in AEGON Hungary s sales organization already generating results in 4Q05 new life sales AEGON Poland record sales in 4Q05, now ranked #4 in the Polish life market, new lines of business developed Pension fund of AEGON Slovakia currently has over 70,000 members Life sales for AEGON Czech Republic started after launch of operation in April 2005 Annual General Meeting of Shareholders April 25, 2006 12

AEGON Spain Expansion Through the Bank Channel P&C business divested to concentrate on partnerships with savings banks AEGON Spain generated total life premiums of EUR 126 mln and new life sales of EUR 25 mln Partnership with CAM generated total life premiums of EUR 560 mln (+12%) and new life sales of EUR 219 mln (+24%) New joint ventures with Caja de Badajoz and Caja Navarra* AEGON life products will soon be sold in over 1,500 branches across Spain AEGON Spain strives to further expand the network given the dominant role of banks in the Spanish life and pensions market * Transactions expected to close in 2Q 2006 Annual General Meeting of Shareholders April 25, 2006 13

AEGON Pension Network First international network dedicated to providing cross border group pensions solutions for multi-national corporate clients and their employees Developed with the expertise of AEGON s partner in France, La Mondiale, as well as with the cooperation of AEGON subsidiaries in the UK, the Netherlands and the USA Integrated solutions: reporting asset pooling customized local pension and employee benefits programs expatriate solutions HDI Pensionsmanagement recently joined AEGON Pension Network, providing presence in Germany Annual General Meeting of Shareholders April 25, 2006 14

Developments in Other countries - Asia Roll out across China from Shanghai to Beijing, Nanjing and Shandong reaching a population of over 150 mln people AEGON-CNOOC s multi-channel distribution strengthened with the addition of brokers Shandong Nanjing Growth on track top 10 foreign life insurer In Taiwan new business sales grew 58% reflecting strong sales in 1H 2005 Fourth quarter sales exceeded third quarter sales by 54% Increased efforts to sell unit-linked products showed encouraging results in the fourth quarter Annual General Meeting of Shareholders April 25, 2006 15

Overall a Good Year Improved position in AEGON s three major markets Expansion strategy delivering results AEGON is well-positioned to deliver the products and services that will lead to the continued growth of our business Annual General Meeting of Shareholders April 25, 2006 16

Jos Streppel Member Executive Board AEGON N.V. Lid Raad van Bestuur AEGON N.V. Annual General Meeting of Shareholders April 25, 2006 17

Financial Performance (in EUR mln, except per share data) FY 2005 FY 2004 constant exchange rates Operating earnings before tax 2,147 1,772 21% 21% Net gains/losses on investments and impairment charges (before tax) 1,171 1,020 15% 15% Other non operating income/(charges) 277 (22) - - Share in profit/(loss) of associates 20 25 (20%) (20%) Income before tax 3,615 2,795 29% 29% Net income 2,732 2,256 21% 21% - per share 1.63 1.38 18% 18% Annual General Meeting of Shareholders April 25, 2006 18

AEGON Group Sales Overview (in EUR mln) FY 2005 FY 2004 4Q 2005 4Q 2004 APE Life Insurance 2,539 2,320 9% 643 639 1% Annuity and institutional guaranteed products deposits 15,414 14,312 8% 3,604 2,735 32% Total gross premiums 18,882 18,329 3% 5,021 4,891 3% Off balance sheet production 17,425 16,027 9% 4,451 4,416 1% Increase in new life sales of 9% driven by all country units Strong growth in Variable Annuity sales and traditional GIC s Production off balance sheet driven by the Netherlands, the UK and Other countries Annual General Meeting of Shareholders April 25, 2006 19

Americas Sales Overview (in USD mln) FY 2005 FY 2004 4Q 2005 4Q 2004 APE Life Insurance 1,166 1,087 7% 287 303 (5%) Institutional Guaranteed Products 10,712 9,487 13% 2,121 1,649 29% Fixed Annuities 2,221 3,017 (26%) 626 605 3% Variable Annuities 6,260 5,278 19% 1,529 1,354 13% Off b/s production 18,353 18,435 (0%) 4,912 5,275 (7%) New life sales increased by 7%; life reinsurance sales up 46% Sequential growth in Fixed Annuity sales continued in 4Q 2005 through improved distribution platform Strong Variable Annuity sales notable in both retail and pension segments Off balance sheet production remains stable Annual General Meeting of Shareholders April 25, 2006 20

Americas Operating Earnings (in USD mln) FY 2005 FY 2004 4Q 2005 4Q 2004 Operating earnings before tax 2,365 2,026 17% 667 427 56% Income before tax 2,717 2,112 29% 727 510 43% Net income 2,014 1,670 21% 599 506 18% Annual General Meeting of Shareholders April 25, 2006 21

The Netherlands Sales Overview (in EUR mln) FY 2005 FY 2004 4Q 2005 4Q 2004 APE Life Insurance 231 226 2% 62 72 (14%) Savings deposits 3,478 2,881 21% 939 568 65% Off b/s production 864 789 10% 149 178 (16%) Strong group pension production by capturing several large contracts Individual life market remains challenging Off balance sheet sales higher on asset-only contracts and increased sales of TKP Pensions Annual General Meeting of Shareholders April 25, 2006 22

The Netherlands Operating Earnings (in EUR mln) FY 2005 FY 2004 4Q 2005 4Q 2004 Operating earnings before tax 322 196 64% 102 69 48% Income before tax 1,286 1,097 17% 229 472 (51%) Net income 1,014 920 10% 207 444 (53%) Annual General Meeting of Shareholders April 25, 2006 23

UK Sales Overview (in GBP mln) FY 2005 FY 2004 4Q 2005 4Q 2004 APE Life Insurance 687 662 4% 196 169 16% Off b/s production 1,032 143-85 60 42% New life sales increased 4% in 2005 and 16% in the fourth quarter, making it the highest sales quarter ever in the UK Broader range of non-pension products resulted in over 30% of new business coming from annuities, bonds and protection products Increasing off balance sheet production mainly attributable to the continued strong performance of AEGON UK s fixed income team Annual General Meeting of Shareholders April 25, 2006 24

UK Operating Earnings (in GBP mln) FY 2005 FY 2004 4Q 2005 4Q 2004 Operating earnings before tax 111 109 2% 30 33 (9%) Income before tax 186 150 24% 50 49 2% Net income 98 82 20% 34 24 42% Excluding the effect of the accelerated acquisition of Positive Solutions operating earnings before tax increased 32% Annual General Meeting of Shareholders April 25, 2006 25

Other countries Sales Overview (in EUR mln) FY 2005 FY 2004 4Q 2005 4Q 2004 APE Life Insurance 368 245 50% 54 92 (41%) Off b/s production 318 204 56% 80 68 18% New life sales increased 50% driven by strong sales in Taiwan in the first half of 2005 Strong off balance sheet production driven by increased pension fund deposits in Hungary and Slovakia Annual General Meeting of Shareholders April 25, 2006 26

Other countries Operating Earnings (in EUR mln) FY 2005 FY 2004 4Q 2005 4Q 2004 Operating earnings before tax 44 113 (61%) 5 30 (83%) Income before tax 248 135 84% 11 39 (72%) Net income 211 101 109% 10 29 (66%) Decrease in operating earnings primarily reflects lower contributions from Spain, due to the sale of the general insurance activities Annual General Meeting of Shareholders April 25, 2006 27

Shareholders Equity Development (in EUR mln) 2,732 1,515 76 152 (132) 330 19,276 (272) 14,875 Shareholders equity increased 30% to EUR 19,276 million in 2005 Shareholders' Net income Dividend paid Currency Sold ow n Change fair Coupon on Other Shareholders' equity shares value reserve perpetuals equity January 1 December 31 Annual General Meeting of Shareholders April 25, 2006 28

Donald J. Shepard Chairman Executive Board AEGON N.V. Voorzitter Raad van Bestuur AEGON N.V. Annual General Meeting of Shareholders April 25, 2006 29

Share price development vs. US peers (1 year, USD) Share price development in USD as of AGM April 2005 Manulife AEGON (USD) Prudential US Principal Lincoln Financial Metlife Inc Nationwide Hartford AIG US insurance sector 0% 10% 20% 30% 40% 50% Annual General Meeting of Shareholders April 25, 2006 30

Share price development vs. European peers (1 year, local currency) Share price development in local currency as of AGM April 2005 AEGON (EUR) Allianz Zurich Financial ING AXA European insurance sector Prudential UK Aviva Generali Fortis 0% 10% 20% 30% 40% 50% Annual General Meeting of Shareholders April 25, 2006 31

Valuation: ten year historical P/E development 70 60 50 40 30 AEGON ING Fortis ABN AMRO 20 10 0 Trailing P/E multiples 29/12/1995 29/12/1996 29/12/1997 29/12/1998 29/12/1999 29/12/2000 29/12/2001 29/12/2002 29/12/2003 29/12/2004 29/12/2005 Annual General Meeting of Shareholders April 25, 2006 32