22 November 2006 Please note: this is a translation; only the German version of this news release is legally binding. Vienna Insurance Group (Wiener Städtische Group) during the first nine months 2006 (IFRS figures): Vienna Insurance Group sets new targets: Profit expectations for 2006 and 2007 increased for the first time new targets for the year 2009 Group profit before tax already achieved year end 2005 level Group continues double-digit premium growth / CEE is the big growth driver For the first time, with approx. 50 percent contribution, CEE exceeds Austria s P&C share of business "In the light of the excellent development, the Management Board of the Vienna Insurance Group has set new Group targets for the years 2006 to 2009. Thus, Group profit of 2005 will be doubled in the year 2009. In the first three quarters of the current year we have achieved an impressive growth in total of around 42 percent in the booming CEE market. We increased Group profits before tax by about 23 percent to approx. EUR 231 million, already hitting the Group's YE 2005 in the first nine months. All countries have made a positive contribution to this result, despite the high number of claims incurred due to natural disasters in the first half year 2006, comments Günter Geyer, CEO, on the Group's continuing dynamic growth. I. OVERVIEW OF KEY GROUP DATA FOR QUARTERS 1 3/2006 * : From January - September 2006 the Vienna Insurance Group achieved consolidated premiums written in the amount of EUR 4.32 billion, an increase of 14.4 percent as compared to the same period of the previous year. Including other insurance participations, non-consolidated premiums written amounted to EUR 4.53 billion. The Group s profit before tax rose by 22.9 percent to EUR 230.72 million in the first three quarters 2006, already hitting the level of the full year 2005 (approx. EUR 240 million). This result was achieved despite the increased expenses for claims incurred in the current year due to damage caused by snow pressure and flooding. Furthermore, * As compared to the same period of the previous year, the following companies were included in the consolidated accounts for the first time during the first three quarters 2006: Cigna, Benefia, Cosmopolitan, Helios, Bulstrad, Royal Polska.
the figure for the comparable period of the previous year included profits realised from the sale of Investkredit and stakes in Porr in the amount of approx. EUR 45 million. On the other hand, non-profit residential building companies have been included for the first time, contributing EUR 14.2 million to the Group's profits before tax in the first three quarters of this year. The combined ratio after reinsurance (excluding investment income) is 97.0 percent, continuing to be below the 100 percent mark despite the high number of claims due to flooding and snow pressure. The financial result of the first three quarters of 2006 amounted to EUR 538.61 million, showing a strong increase of 19.4 percent, due to the changed situation of the capital markets in the third quarter 2006. The gross expenses for claims incurred increased (snow pressure, flooding) by 14.3 percent to EUR 3.00 billion. The total investments of the Group rose from EUR 16.92 billion (as of December 31, 2005) to EUR 18.83 billion as of 30 September 2006 (plus 11.3 percent). II. DATA FOR THE GROUP FOR Q1-3 2006, IN TOTAL (CONSOLIDATED) With a total of premiums written of EUR 4.32 billion reflecting a premium expansion of 14.4 percent, the Vienna Insurance Group successfully continued its dynamic growth in the first nine months of 2006. The CEE companies are still strong growth drivers, generating premiums written of EUR 1.61 billion, which constitutes an increase of 42.5 percent. The share in the Group s premiums is thus already as high as approx. 37 percent. In the property/casualty business the CEE companies already contribute nearly 50 percent, exceeding Austria s share for the first time. In the Austrian companies, premiums written amounted to EUR 2.55 billion. This is an increase of 4.2 percent compared to the same period of the previous year. Premiums written on other markets (Germany and Liechtenstein) totalled EUR 159.03 million. Günter Geyer: "Earlier than expected CEE companies now account for approx. 50 percent of total Group property/casualty premiums. For the first time premium income from CEE in this segment is higher than in Austria." III. DATA FOR THE GROUP FOR Q1-3 2006, CLASSED BY SEGMENTS (CONSOLIDATED): 1. BUSINESS SEGMENT RESULTS Property/casualty insurance In the first nine months of 2006 the Vienna Insurance Group was able to achieve a considerable increase in premiums by 20.8 percent, to a total of EUR 2.41 billion. In the CEE markets, a premium volume of EUR 1.19 billion was achieved in that segment, which translates to a dynamic growth of 40.5 percent. In Austria, the premium expansion in the property/casualty segment was 6.2 percent, with premiums written amounting to EUR 1.18 billion. 2
In the other markets (Germany and Liechtenstein) premiums went up to EUR 46.73 million (a plus of 6.3 percent). In the first three quarters of 2006 profit before tax in the property/casualty segment amounted to EUR 144.71 million, a sharp 30.4 percent increase compared to the same period of the previous year. Life insurance Premiums written of the Vienna Insurance Group in the life insurance segment amounted to a total of EUR 1.68 billion from January - September 2006 having grown by 7.8 percent. An impressive contribution to that figure was already provided by the CEE subsidiaries with an outstanding plus of 48.5 percent or an expansion to EUR 420.87 million in premium income, already reflecting a share of one quarter in this particular segment. The Austrian Group companies were able to increase premiums written by 2.4 percent to EUR 1.15 billion. In the other markets (Germany and Liechtenstein), premiums written amounted to EUR 112.31 million. Profit before tax in the life insurance segment was up 17.0 percent to EUR 73.87 million. Health insurance In the health insurance segment, the Vienna Insurance Group generated premiums written in the amount of EUR 225.03 million, which translates to an increase of 3.0 percent. The health insurance business is still predominantly focused on the Austrian market. Health insurance continued to have a steady contribution of EUR 12.14 million to profits before tax. 2. GEOGRAPHIC RESULTS Austria In the first nine months of 2006 the Vienna Insurance Group with its Austrian companies was able to generate a total of EUR 2.55 billion in premiums written. This translates to a 4.2 percent premium expansion. Profit before tax in Austria was EUR 151.75 million, representing a sharp increase of 20.0 percent compared to the period of the previous year, despite the large numbers of claims incurred due to flooding and snow pressure this year. Czech Republic In the Czech Republic, the Vienna Insurance Group achieved premiums written in the amount of EUR 775.30 million. As compared to the first nine months of the previous year, this is an increase by satisfactory 18.5 percent. In spite of substantial extraordinary burden caused by bad weather at the beginning of the year the Czech Group companies ware able to generate a total profit before tax of EUR 38.54 million, representing a considerable increase of 23.7 percent. 3
Slovakia In Slovakia the premium volume of the Vienna Insurance Group rose by 13.6 percent to EUR 287.06 million. The profit before tax of all Slovak Group companies totalled EUR 20.46 million. Other CEE countries In the other CEE countries, double-digit increases were achieved on all markets. A total of EUR 549.05 million was generated in premiums written. For the Vienna Insurance Group this implicates an outstanding growth in premiums of 145.2 percent. Profit before tax in this segment amounted to EUR 10.84 million. The term other CEE as used by the Vienna Insurance Group includes Bulgaria, Croatia, Poland, Romania, Serbia and Hungary. The Georgian, Russian, Ukrainian and Belarusian companies are not yet consolidated. Other markets In its other markets (Germany and Liechtenstein) the Vienna Insurance Group was able to generate premiums written of EUR 159.03 million. Profit before tax of the Group companies totalled EUR 9.14 million. IV. NEW TARGETS FOR THE YEARS 2006 2009 Given the excellent results achieved in the first nine months of 2006, the profit before tax target for 2006 has now been increased from the latest figure of EUR 290 million to about EUR 310 million. Furthermore, also for the year 2007 a significant increase of the profit before tax from EUR 350 million to about EUR 370 million is planned. For 2009, the Group s profit target before tax is determined by about EUR 470 million, i.e. quasi a doubling of Group s 2005 profit before tax. Die Vienna Insurance Group is Austria's leading insurance group in Central and Eastern Europe and number two in the world on the same market. Outside its home Austrian market, the Vienna Insurance Group is active in Bulgaria, Germany, Georgia, Croatia, Liechtenstein, Poland, Romania, Russia, Serbia, Slovakia, the Czech Republic, Hungary, the Ukraine and Byelorussia through its insurance subsidiaries. It also has branches in Italy and Slovenia. In Austria, the Vienna Insurance Group owns WIENER STÄDTISCHE Versicherung AG, Donau Versicherung, Bank Austria Creditanstalt Versicherung and Union Versicherung. It also has a participating interest in Wüstenrot Versicherung and in Sparkassen Versicherung. In Austria, the Czech Republic, Slovakia and Romania the Vienna Insurance Group is the leading, or second largest insurer. 4
Contact: Wiener Städtische Versicherung AG Vienna Insurance Group Investor Relations, 1010 Vienna, Schottenring 30 Thomas Schmee Tel.: +43 50 350 21900 Fax: +43 50 350 99 21900 mailto:t.schmee@staedtische.co.at Nina Higatzberger Tel.: +43 50 350 21920 Fax: +43 50 350 99-21920 mailto:n.higatzberger@staedtische.co.at Wiener Städtische s Investor Relations News are also available at www.wienerstaedtische.com/ir under IR News 5
Consolidated Balance Sheet (IFRS) 30 September 2006 Assets 30/09/2006 31/12/2005 +/- % A. Intangible assets 440,169 316,902 38.9 B. Total investments 16,737,374 15,162,669 10.4 C. Unit- and index-linked investments 2,095,114 1,762,071 18.9 D. Reinsurers' share in technical provisions 972,414 840,060 15.8 E. Receivables 1,001,649 856,853 16.9 F. Deferred tax assets 20,768 11,838 75.4 G. Other assets 191,632 200,706-4.5 H. Cash and cash equivalents 171,993 290,347-40.8 Total Assets 21,631,113 19,441,446 11.3 Equity and Liabilities 30/09/2006 31/12/2005 +/-% A. Shareholders' equity 2,132,628 2,059,332 3.6 B. Subordinated liabilities 413,200 413,200 0.0 C. Technical provisions 14,265,473 13,086,292 9.0 D. Unit- and index-linked technical provisions 2,022,674 1,729,868 16.9 E. Non-technical provisions 793,983 871,386-8.9 F. Liabilities 1,830,828 1,074,731 70.4 G. Deferred tax liabilities 98,667 123,944-20.4 H. Other liabilities 73,660 82,693-10.9 Total equity and liabilities 21,631,113 19,441,446 11.3 Consolidated Income Statement (IFRS) 1 Jan. 2006-30 September 2006 9M 2006 9M 2005 +/- % Gross premiums written 4,320.6 3,778.1 14.4 A. Net earned premiums 3,586.8 3,094.0 15.9 B. Net investment income 533.3 448.1 19.0 C. Other income 38.7 25.2 53.7 D. Expenses for claims incurred -2,999.9-2,625.7 14.3 E. Operating expenses -822.0-661.9 24.2 F. Other expenses -111.5-95.0 17.4 Income from shares in affiliated and associated companies 5.3 3.0 76.5 Profit before taxes 230.7 187.7 22.9 Taxes -41.3-46.4-10.9 Profit for the period 189.4 141.3 34.1 Minority interests -7.0-7.9-11.6 Net profit after minorities 182.4 133.4 36.8 6
Segment Reporting 1 Jan. 2006-30 Sept. 2006 Split by Business Segments: P&C Life Health Total 9M 2006 9M 2005 9M 2006 9M 2005 9M 2006 9M 2005 9M 2006 9M 2005 Gross written premiums 2,413.8 1,998.9 1,681.8 1,560.7 225.0 218.5 4,320.6 3,778.1 A. Net earned premiums 1,690.5 1,330.0 1,673.5 1,548.1 222.8 215.9 3,586.8 3,094.0 B. Net investment income 1 94.6 58.8 436.2 377.3 7.9 15.0 538.6 451.0 C. Other income 26.2 17.5 12.5 7.7 0.0 0.0 38.7 25.2 D. Expenses for claims incurred -1,132.9-869.5-1,677.2-1,566.9-189.8-189.4-2,999.9-2,625.7 E. Operating expenses -452.7-353.8-341.3-280.6-28.1-27.4-822.0-661.9 F. Other expenses -80.9-72.0-29.8-22.5-0.7-0.4-111.5-95.0 G. Profit before tax 144.7 111.0 73.9 63.1 12.1 13.6 230.7 187.7 Split by Regions: Austria Czech Republic Slovakia 9M 2006 9M 2005 9M 2006 9M 2005 9M 2006 9M 2005 Gross written premiums 2,550.2 2,447.5 775.3 654.5 287.1 252.7 A. Net earned premiums 2,216.2 2,116.1 595.0 487.9 203.5 164.0 B. Net investment income 1 460.6 387.6 29.4 19.4 12.5 11.9 C. Other income 5.5 9.6 12.3 4.7 5.2 2.1 D. Expenses for claims incurred -2,066.5-1,949.5-432.8-328.8-129.7-99.9 E. Operating expenses -442.2-419.4-132.5-114.0-42.9-40.3 F. Other expenses -21.9-17.9-32.9-38.0-28.1-16.3 G. Profit before tax 151.8 126.5 38.5 31.2 20.5 21.4 Other CEE Other Total 9M 2006 9M 2005 9M 2006 9M 2005 9M 2006 9M 2005 Gross written premiums 549.0 223.9 159.0 199.5 4,320.6 3,778.1 A. Net earned premiums 433.2 145.4 139.0 180.8 3,586.8 3,094.0 B. Net investment income 1 22.4 16.4 13.7 15.7 538.6 451.0 C. Other income 12.2 6.4 3.5 2.5 38.7 25.2 D. Expenses for claims incurred -255.1-93.5-115.8-154.1-2,999.9-2,625.7 E. Operating expenses -185.6-65.7-19.0-22.5-822.0-661.9 F. Other expenses -16.3-10.3-12.3-12.6-111.5-95.0 G. Profit before tax 10.8-1.1 9.1 9.7 230.7 187.7 1 including income from associated and affiliated companies 7