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Strong results, raised dividends

Sampo Group's profit before taxes for 2010 grew strongly and amounted to EUR 1,320 million (825). Total comprehensive income for the period, taking changes in the market value of assets into account, was EUR 1,807 million (3,423).

  • Earnings per share rose to EUR 1.97 (1.14). Mark-to-market earnings per share were EUR 3.22 (5.88) and return on equity for the Group was 21.8 per cent for 2010 (55.7).

  • The Board proposes to the Annual General Meeting to be held on 14 April 2011 a dividend of EUR 1.15 per share (1.00) and an authorization to repurchase a maximum of 50 million Sampo A shares.

  • Net asset value per share increased by more than EUR 3 during 2010 and on 31 December 2010 amounted to EUR 17.79 (14.63). Fair value reserve on the Group level increased to EUR 736 million (296).

  • If P&C sustained a high insurance technical profitability in 2010 despite the difficult winter. Combined ratio was 92.8 per cent for the full year 2010 (92.1). Profit before taxes rose to EUR 707 million (644). Return on equity was 39.8 per cent (53.2) and fair value reserve increased to EUR 315 million (105).

  • Sampo's share of Nordea's net profit amounted to EUR 523 million. In segment reporting the share of Nordea's profit is included in the segment 'Holding'.

  • Profit before taxes for Mandatum Life increased to EUR 142 million (121). Fair value reserve increased to EUR 436 million as at 31 December 2010 (210). Return on equity at market value was 36.2 per cent (97.6). Premiums grew almost 40 per cent and exceeded EUR 1 billion for the first time ever.
KEY FIGURES 2010
2009
Change %
Q4/2010 Q4/2009 Change %
EURm            
Profit before taxes 1,320 825 60 361 199 81
  P&C insurance 707 644 10 188 168 12
  Associate (Nordea) 523 - - 152 - -
  Life insurance 142 121 17 42 36 15
  Holding (excl. Nordea) -48 36 - -21 -5 332
Profit for the period 1,104 641 72 302 148 104
      Change     Change
Earnings per share, EUR 1.97 1.14 0.83 0.54 0.26 0.28
EPS (incl. change in FVR) EUR 3.22 5.88 -2.66 0.83 -0.17 1.00
NAV per share, EUR  17.79 14.63 3.16 - - -
Average number of staff (FTE) 6,914 7,311 -397 - - -
Group solvency ratio, % 167.1 158.3 8.8 - - -
RoE, % 21.8 55.7 -33.9 - - -

The figures in this report are unaudited.

 

Fourth quarter 2010 in brief

Sampo Group's fourth quarter 2010 profit before taxes rose to EUR 361 million (199). Earnings per share doubled and were EUR 0.54 (0.26). Mark-to-market earnings per share were EUR 0.83 (-0.17).

Net asset value per share increased in the fourth quarter of 2010 by EUR 1.25 and amounted EUR 17.79 at the end of 2010.

P&C insurance operation had a good fourth quarter despite somewhat harsher winter conditions in the Nordic countries. Combined ratio improved to 92.3 per cent (92.7). Profit before taxes rose to EUR 188 million (168).

Sampo's share of Nordea's fourth quarter 2010 net profit was EUR 152 million.

Profit before taxes for the life insurance operations rose to EUR 42 million (36). Premiums written remained almost flat at EUR 284 million (289).

 

Business areas in 2010

P&C insurance

If P&C is the leading property and casualty insurance company in the Nordic region, with insurance operations that also encompass the Baltic countries and Russia. The P&C insurance group's parent company, If P&C Insurance Holding Ltd, is domiciled in Sweden, and the If subsidiaries provide insurance solutions and services in Finland, Sweden, Norway, Denmark, the Baltic countries and Russia. If's operations are divided into four business areas: Private, Commercial, Industrial and Baltic & Russia.


Results
2010
2009
Change %
Q4/2010 Q4/2009 Change %
EURm            
Premiums, net 3,985 3,677 8 843 787 7
Net income from investments 487 394 24 146 110 33
Other operating income 25 23 9 7 6 24
Claims incurred -2,689 -2,477 9 -672 -630 7
Change in insurance liabilities -91 -33 176 148 144 3
Staff costs -479 -470 2 -120 -123 -2
Other expenses -501 -439 14 -156 -118 32
Finance costs -29 -30 -4 -8 -8 2
Profit (loss) before taxes 707 644 10 188 168 12
Key figures     Change     Change
Combined ratio, % 92.8 92.1 0.7 92.3 92.7 -0.4
Risk ratio, % 69.1 68.0 1.1 67.7 67.6 0.1
Cost ratio, % 23.7 24.1 -0.4 24.6 25.0 -0.4
Expense ratio, % 17.2 17.6 -0.4 17.8 18.5 -0.7
Return on equity, % 39.8 53.2 -13.4 - - -
Average number of staff (FTE) 6,392 6,807 -415 - - -

Year 2010 was characterized by exceptional weather conditions in most of the countries where If operates: extreme winter, scorching summer riddled with storms and heavy downpours, and in the fourth quarter weeks of premature but abundant snowfall.

Another exceptional development in 2010 reflected in consolidated P&C insurance result is the significant strengthening of Swedish krona.

Despite the challenging weather conditions, profit before taxes for P&C insurance for the year 2010 rose 10 per cent to EUR 707 million (644) and combined ratio was again on a stable level in 2010 at 92.8 per cent (92.1) being clearly better than the long-term target of below 95 per cent.

Technical result was EUR 449 million (488), of which the Private business area accounted for 53 per cent, Commercial 28 per cent, Industrial 15 per cent and Baltic and Russia 3 per cent.

Insurance margin (technical result in relation to net premiums earned) decreased from the previous year to 11.5 per cent (13.4). Return on equity (RoE) remained good and was 39.8 per cent (53.2) while the fair value reserve increased to EUR 315 million (105).

In business area Private risk ratio increased to 68.9 per cent (68.0) affected by the exceptional weather conditions. Helped by the improved cost ratio, combined ratio increased slightly to 93.0 (92.5). Also in Commercial cost ratio improved compared to last year but the weakened risk ratio of 69.8 per cent (68.3) drove the combined ratio slightly up to 93.5 per cent (92.6).

In business area Industrial combined ratio improved to 90.6 per cent (90.7) helped by the favorable development in nominal costs. Risk ratio was at previous year's level at 71.9 percent (71.6). In Baltic and Russia both risk ratio and combined ratio increased compared to previous year, and were 56.4 per cent (55.7) and 93.4 per cent (91.7), respectively.

Risk ratio weakened due to extraordinary weather conditions during year 2010 in all countries excluding Sweden, where despite the severe winter both risk ratio and combined ratio improved to 70.2 per cent (72.4) and 93.3 per cent (95.2), respectively. In Norway risk ratio increased to 69.6 per cent (68.8) but due to improved cost ratio in all business areas, combined ratio was at previous year's level at 92.1 per cent (92.0). Also in Finland cost ratio improved in all business areas, but the increase in risk ratio to 67.0 per cent (64.0) lead to a higher combined ratio of 90.4 per cent (88.5). In Denmark risk ratio increased to 72.8 per cent (66.1) and combined ratio to 101.4 per cent (93.7).

Gross written premiums increased 8 per cent to EUR 4,189 million (3,888).Adjusted for currency, premiums increased 1.3 per cent.

Cost ratio improved by 0.4 percentage points to 23.7 per cent compared to a year earlier as a result of continuous efforts put on streamlining the operations.The amount of total costs increased to EUR 1,009 million (939), mainly due to the strengthening of the Swedish krona.

Other operating expenses increased EUR 25 million due to dissolving the collective guarantee provision in the Finnish workers' compensation insurance.

Claims incurred increased to EUR 2,689 million (2,477) and risk ratio deteriorated to 69.1 per cent (68.0), affected by the weather. EUR 113 million (87) was released from technical reserves, which related to prior year claims. Reserve ratio was 173 per cent (172) of net premiums written and 236 per cent (240) of claims paid.

Investment market remained positive during the year and net income from investments increased to EUR 487 million (394). As at 31 December 2010, total investment assets amounted to EUR 11.7 billion (10.7) of which 85 per cent (89) was invested in fixed income instruments and 14 per cent (11) in equities. Investment return for 2010 mark-to-market was 7.4 per cent (12.4). Duration for interest bearing assets was 1.7 years (2.5).

As at 31 December 2010 If P&C had a solvency ratio (solvency capital in relation to net premiums written) of 79 per cent (77).Despite the EUR 540 million paid to Sampo plc in dividends during 2010, solvency capital amounted to EUR 3,373 million (2,943) in comparison to the regulatory minimum capital requirement of EUR 735 million.

On 1 January 2011 a new five-year cooperation agreement was announced between If P&C and Volvo Cars regarding Volvia brand insurance. If has more than 443,000 Volvia-insurances in its portfolio, of which 400,000 in Sweden, which means that 40 percent of all Volvo cars in Sweden are insured by Volvia. The deal with Volvo is worth approximately 2 billion Swedish krona in premiums earned for If annually.

 

Life insurance

Mandatum Life Group consists of Mandatum Life, a wholly-owned subsidiary of Sampo plc, operating in Finland, and its subsidiary Mandatum Life Insurance Baltic SE, which has the form of a European company and is headquartered in Estonia. It operates in the other Baltic countries through branches.

Results 2010
2009
Change %
Q4/2010 Q4/2009 Change %
EURm            
Premiums written 1,111 803 38 284 289 -2  
Net income from investments 645 629 3 205 133 53  
Other operating income 0 0 -94 0 0 -100  
Claims incurred -844 -628 34 -214 -162 32  
Change in liabilities for  inv. and ins. contracts -678 -600 13 -210 -205 2  
Staff costs -35 -29 23 -10 -9 19  
Other operating expenses -49 -46 7 -12 -9 27  
Finance costs -8 -8 0 -2 -2 4  
Profit before taxes 142 121 17 42 36 15  
Key figures     Change        
Expense ratio, % 112.1 111.0 1.1 - - -  
Return on equity, % 36.2 97.6 -61.4 - - -  
Average number of staff (FTE) 470 450 20 - - -  

Sampo Group's life insurance operations continued their fast growth in 2010 with premium income growing almost 40 per cent. Profitability was also good and profit before taxes grew 17 per cent to EUR 142 million (121).

Net investment income, excluding income on unit-linked contracts, amounted to EUR 312 million (270). Net income from unit-linked investments was EUR 333 million (359). During 2010 fair value reserve increased EUR 75 million amounting to EUR 436 million. Return on equity (RoE) in life insurance was 36.2 per cent (97.6).

Mandatum Life Group's investment assets, excluding the assets of EUR 3.1 billion (2.4) covering unit-linked liabilities, amounted to EUR 6.0 billion (5.4) at market values as at 31 December 2010. Fixed income represented 61 per cent (68), equity 28 per cent (23), private equity 4 per cent (4), real estate 3 per cent (3) and other assets 3 per cent (2) of the total assets. Return on investments in 2010 was 11.1 per cent (16.8). At the end of December 2010 duration of fixed income assets was 2.7 years (2.6).

Mandatum Life Group's solvency position is strong. Solvency margin grew to EUR 1,339 million (930) as at 31 December 2010. Mandatum Life's solvency ratio was 25.7 (18.6). Total technical reserves were EUR 7.5 billion (6.8). Unit-linked reserves continued their strong growth and accounted for 3.1 billion (2.4). The share of unit-linked reserves of total technical reserves increased to 41 per cent (35).

Majority of Mandatum Life's traditional policies carry a guaranteed interest of 3.5 per cent. Individual policies sold in Finland before 1999 carry a guaranteed interest of 4.5 per cent. The discount rate for these policies has been lowered to 3.5 per cent and subsequently technical reserves have been supplemented with EUR 86 million (95). In addition, EUR 61 million has been reserved to lower the interest rate of all with-profit liabilities to 2.5 per cent in 2011 and to 3.0 per cent in 2012. This supplement decreases the minimum requirement for investment yield to 2.5 per cent and 3.0 per cent for 2011 and 2012, respectively. All in all, Mandatum Life has increased its technical reserves with EUR 147 million due to low level of interest rates.

Life operation's expense ratio remained on previous year's level and was 112.1 per cent (111.0). This ratio does not take into account all fees intended to cover the operating expenses. Assuming all fees were to be taken into account, Mandatum Life Group's expense ratio would have been 90.1 per cent (91.8). Mandatum Life does not defer acquisition costs.

Mandatum Life Group's premium income on own account exceeded for the first time one billion euro and amounted to EUR 1,111 million (803). Premiums in the main focus area of unit-linked insurance increased to EUR 843 million (551) and the share of unit-linked premiums was 76 per cent (68) of total premiums. The good sales performance was due to all sales channels working well. Particularly the successful cooperation between the wealth management unit and the proprietary corporate sales force produced excellent results.

A new name was adopted for the Baltic subsidiary in 2010. The company is now called Mandatum Life Insurance Baltic SE. Premium income from the Baltic countries grew by 42 per cent and amounted to EUR 60 million (42).

Mandatum Life's market share in its focus area, unit-linked business, rose to 28.2 per cent (27.8). The company's overall market share in Finland was 22.0 per cent (24.8) and market share in the Baltic countries was 19 per cent (16).

 

Associated company Nordea Bank Ab

On 31 December 2010 Sampo plc held 830,440,497 Nordea shares corresponding to a holding of 20.5 per cent. The average price paid per share amounted to EUR 6.39 and the book value in the Group accounts was EUR 6.85 per share. The closing price as at 31 December 2010 was EUR 8.16.

As Sampo's holding exceeds 20 per cent Nordea, is accounted as an associated company in Sampo Group's accounts since 31 December 2009. Sampo's share of Nordea's net profit is shown on the face of Sampo Group's profit and loss account on the line Share of associate's profit/loss.

The following text is based on Nordea's full-year 2010 result release published on 2 February 2011.

 

2010 showed record-high total income, up 3 per cent compared to last year. Operating profit increased 18 per cent, due to higher income and lower net loan losses. Risk-adjusted profit decreased by 6 per cent compared to the same period last year.

Net interest income decreased 2 per cent compared to last year as a result of lower deposit income and higher funding costs. The combined negative effect is more than EUR 400 million. This income drop was successfully compensated through strong growth in both lending and deposits as well as higher lending margins. Lending increased 11 per cent and deposit volumes 15 per cent. Corporate lending margins were higher, while deposit margins were largely unchanged compared to last year.

Net fee and commission income has recovered strongly and increased 27 per cent. Asset management commission income is up 42 per cent driven by assets under management, which are up 21 per cent in the last 12 months and a more attractive product mix.

Net result from items at fair value decreased by 6 per cent compared to very high levels last year. The customer driven capital markets operations continued to be strong with increasing volumes. The income drop in Group Treasury and Capital Markets unallocated income was approximately EUR 450 million and almost compensated by higher income in the customer areas. Premium income in Life &Pensions was at an all-time-high. Income under equity method was EUR 66 million and other income was EUR 116 million.

Total expenses increased 7 per cent compared to last year. Staff costs increased 2 per cent. In local currencies, total expenses increased 2 per cent and staff costs decreased 2 per cent. Excluding the adjustment of pension plans in Norway, total expenses increased 3 per cent and staff costs were down 1 per cent in local currencies.

Net loan losses decreased 41 per cent to EUR 879 million, compared to last year, corresponding to a loan loss ratio of 31 basis points (56 basis points). Net profit increased 15 per cent to EUR 2,663 million, due to lower net loan losses.

Risk-adjusted profit decreased 6 per cent compared to last year to EUR 2,622 million, mainly due to the exceptionally strong results in Treasury and Markets in 2009.

Activities related to the Group initiatives launched in early 2010 are on track in all areas. In 2010, the initiatives have generated more than EUR 300 million in additional income, i.e. above the target for the year. The efficiency gains amounted to approximately EUR 70 million, in line with earlier expectations. During the fourth quarter, total investments amounted to EUR 77 million, of which EUR 22 million were accounted for as expenses in the income statement. In the full year 2010, total investments amounted to approximately EUR 200 million, of which EUR 74 million were accounted for as expenses in the income statement. The investments are expected to be somewhat higher in 2011.

For more information on Nordea Bank Ab, see www.nordea.com.

 

Holding

Sampo plc controls its subsidiaries engaged in P&C and life insurance. In addition Sampo plc held on 31 December 2010 approximately 20.5 per cent of the share capital of Nordea, the largest bank in the Nordic countries. Nordea is an associated company to Sampo plc.

Results 2010
2009
Change %
Q4/2010 Q4/2009 Change %
EURm            
Net investment income 60 109 -45 3 17 -84
Other operating income 16 13 29 5 4 28
Staff costs -13 -11 18 -3 -3 -4
Other operating expenses -11 -17 -34 -3 -4 -13
Finance costs -100 -58 73 -22 -19 18
Share of associates' profit 523 - - 152 - -
Profit before taxes 474 36 1,217 132 -5 -
      Change      
Average number of staff (FTE) 52 54 -2 - - -

The segment's profit before taxes amounted to EUR 474 million (36), of which EUR 523 million relates to Sampo's share of Nordea's 2010 profit. Segment's profit without Nordea was EUR -48 million.

Sampo plc's holding in Nordea Bank was booked in the consolidated balance sheet at EUR 5.7 billion. The market value of the holding was EUR 6.8 billion at 31 December 2010. In addition the assets on Sampo plc's balance sheet included holdings in subsidiaries for EUR 2.4 billion (2.4).

In 2010, Sampo plc received a total of EUR 540 million (SEK 5,000 million) in dividends from If P&C Insurance Holding AB: in April a dividend of EUR 103 million (SEK 1,000 million) and in December a dividend of EUR 437 million (SEK 4,000 million) was paid. In addition the associated company Nordea Bank AB paid on 8 April 2010 Sampo plc a dividend amounting to EUR 204 million. Mandatum Life paid no dividends to Sampo plc during 2010.

Sampo plc's debt financing at the end of 2010 was EUR 1,731 million and interest bearing assets including bank accounts were of EUR 715 million. During the year the net debt decreased marginally by EUR 32 million to EUR 1,016 million (1,048). Gross debt to Sampo plc's equity was 26 per cent (24).

As at 31 December 2010 financial liabilities in Sampo plc's balance sheet consisted of issued senior bonds and notes of EUR 1,026 million, EUR 576 million of outstanding CPs issued and a TYEL-pension loan of EUR 130 million. The average interest on Sampo plc's debt as of 31.12.2010 was 3.36 per cent.

 

Developments in 2010

Personnel

The number of full-time equivalent staff decreased to 6,844 employees (7,087) as at 31 December 2010. In P&C insurance, the number of staff mainly decreased in the Baltic and Russian operations and in Norway. In life insurance, the number of staff increased slightly both in Finland and the Baltics.

During 2010, approximately 92 per cent of the staff worked in P&C insurance, 7 per cent in life insurance and 1 per cent in the parent company Sampo plc. Geographically, 31 per cent worked in Finland, 27 per cent in Sweden, 22 per cent in Norway and 20 per cent in the Baltic countries, Russia, Denmark and other countries. The average number of employees during 2010 was 6,914, which compares to an average of 7,311 during 2009.

 

Management incentive schemes

On 8 June 2010 Sampo's Board approved a Compensation Code which applies to all Group companies. The Boards of these companies have adopted company-level policies based on the Code. The Code lays down the principles for e.g. management incentives and can be viewed at www.sampo.com/compensation .

The variable compensation in Sampo Group is divided into short term and long term compensation. The short term compensation is based on annual performance whilst the long term compensation is carried out through the management incentive schemes. For the short term variable compensation systems decided after 1 January 2011, at least 50.1 per cent of significant pay-outs will be deferred for at least three years. In Sweden different national rules are applied and at least 60 per cent of pay-out for persons in risk-taking positions will be deferred.

The management incentive schemes of Sampo Group were in 2010 of two types; long-term management incentive schemes based on share appreciation rights and one share-based incentive scheme.

The outcome of the long-term management incentive schemes is determined by Sampo's share-price development over a period of approximately three years starting from the issue of the respective program. The programs are subject to thresholds on share price development and company profitability, as well as ceilings for maximum bonuses. Furthermore, the programs are subject to rules requiring part of the paid bonus to be used to acquire Sampo shares, which must in turn be held for a specified period of time.

In 2006, Sampo's Annual General Meeting decided on a share-based incentive scheme for the Executive Management belonging to the Group Executive Committee. Under the program, the participants are granted the right to receive up to a pre-determined number of Sampo shares, if Sampo's share price has outperformed a predefined threshold value and insurance margin targets have been exceeded. The reward will be paid in Sampo shares, in cash or a combination thereof. Furthermore, the programs are subject to lock-up on Sampo shares received. The scheme ended during 2010.

In 2010 EUR 10 million (0) was paid out based on the long-term management incentive schemes and EUR 4 million (2) was paid out based on the share-based incentive scheme.

The terms of all incentive schemes are available on Sampo's website at www.sampo.com/compensation.

 

Shares and share capital

As at 31 December 2010, Sampo plc had 561,282,390 shares, which were divided into 560,082,390 A shares and 1,200,000 B shares. At the end of the financial year, Sampo plc didn't hold any of its own A shares. Neither did the other Group companies hold any shares in the parent company.

On 13 October 2010, Sampo plc received a disclosure according to which Capital Research and Management Company's holding in Sampo plc had on 11 October 2010 fallen below one twentieth (1/20) of Sampo plc's entire stock and voting rights. According to the notification Capital Research held 4.95 per cent of Sampo's total share capital and 4.91 per cent of related votes.

 

Ratings

All the main ratings for Sampo Group companies remained unchanged in 2010.

Rated company Moody's Standard and Poor's
  Rating Outlook Rating Outlook
Sampo plc Baa2 Stable Not rated -
If P&C Insurance Ltd (Sweden) A2 Stable A Stable
If P&C Insurance Company Ltd (Finland) A2 Stable A Stable

Group solvency

With Nordea Bank AB (publ) as its associated company as of 31 December 2009 Sampo Group became a financial and insurance conglomerate according to the Act on the Supervision of Financial and Insurance Conglomerates (2004/699).

Group solvency has in 2010 been calculated according to Chapter 3 of the Act on the Supervision of Financial and Insurance Conglomerates (2004/699). The Act is based on Directive 2002/87/EC of the European Parliament and of the Council on the supplementary supervision of credit institutions, insurance undertakings and investment. 

SAMPO GROUP SOLVENCY  

31 December 2010
31 December 2009
EURm    
Group capital 8,886 7,613
Sectoral items 1,711 1,545
Intangibles and other deductibles -2,388 -2,314
Dividends for the current period -646 -561
Group's own funds, total 7,564 6,283
Minimum requirements for own funds, total 4,526 3,968
Group solvency 3,038 2,315
Group solvency ratio    
(Own funds % of minimum requirements) 167.1 158.3

The Group's solvency ratio (own funds in relation to minimum requirements for own funds) was 167.1 per cent (158.3) as at 31 December 2010. The part of Nordea's capital requirement corresponding to Sampo's holding in Nordea is taken into account in the Group's capital requirement.

In Sampo Group solvency is assessed internally by comparing the capital required to the capital available. Capital requirement assessment is based on an economic capital framework, in which Group companies quantify the amount of capital required for measurable risks over a one year time horizon at 99.5 per cent's confidence level. In addition to economic capital companies are assessing their capital need related to non-measurable risks like risks in business environment.

Capital available or Adjusted Solvency Capital include regulatory capital and in addition other loss absorbing items like the effect of discounting technical reserves and other reserves excluded from regulatory capital.    

The economic capital tied up in Group's operations on 31 December 2010 was EUR 4,281 million (3,783) and adjusted solvency capital was EUR 8,521 million (7,077).

 

Events after the end of the reporting year

Sampo plc increased its stake in Nordea Bank AB (publ) with 0.7 percentage points by buying 30 million shares in an auction organized by the Swedish state on 4 February 2011. SEK 2,235 million was paid for the shares. After the purchase, Sampo holds 860,440,497 Nordea shares corresponding to 21.3 per cent of all shares in Nordea.

 

Outlook for 2011

Growth in the global economy is expected to pick up momentum and deleveraging to continue as markets prove their resilience and adaptiveness. The European debt crisis, if properly managed, is expected to abate gradually. All in all the economic landscape in 2011 is expected to be fairly benign.

Sampo Group is expected to report a good result for 2011. P&C and life insurance operations are expected to report good and stable results and the contribution to profit of associated company Nordea Bank is anticipated to remain strong. The continuing rise of short term interest rates will also further strengthen Sampo Group's profits.

If P&C is expected to reach its long-term combined ratio target of below 95 per cent in 2011. Profit is expected to remain very good.

Nordea's contribution to the Group's profit is expected to be significant.

Mandatum Life's profitability is expected to remain good although it is highly dependent on capital market developments.

Dividend proposal

On 11 February 2010 the Board adopted a new dividend policy. According to the policy total annual dividends paid will be higher than 50 per cent of Group's net profit for the year (excluding extraordinary items). In addition share buy-backs can be used to complement the cash dividend.

The parent company's distributable capital and reserves totaled EUR 6,597,907,788.86, of which profit for the financial year was EUR 710,467,413.51.

The Board proposes to the Annual General Meeting a dividend of EUR 1.15 per share to company's 561,282,390 shares. The dividends to be paid are EUR 645,474,748.50 in total. Rest of funds are left in the equity capital.

The dividend will be paid to shareholders registered in the Register of Shareholders held by Euroclear Finland Ltd as at the record date of 4 April 2011. The Board proposes that the dividend be paid on 28 April 2011.

No significant changes have taken place in the company's financial position since the end of the financial year. The company's liquidity position is good and in the view of the Board, the proposed distribution does not jeopardize the company's ability to fulfill its obligations.

SAMPO PLC
Board of Directors

 

For more information, please contact:

Peter Johansson, Group CFO, tel. +358 10 516 0010

Jarmo Salonen, Head of Investor Relations and Group Communications, tel. +358 10 516 0030

Essi Nikitin, IR manager, tel. +358 10 516 0066

Maria Silander, Press Officer, tel. +358 10 516 0031

 

Sampo will arrange a Finnish-language press conference (Savoy, Eteläesplanadi 14, Helsinki), at 12:30 pm Finnish time. An English-language telephone conference for investors and analysts will be arranged at 4 pm Finnish time (2 pm UK time). Please call +44 207 162 0025 (Europe) or +1 334 323 6201 (North America). Please be ready to state the conference ID '886644' and the conference title 'Sampo plc 2010/Q4 Release'.

The telephone conference can also be followed from a direct transmission on the Internet at www.sampo.com/result.  A recorded version will later be available at the same address.

In addition, Group CEO and President Kari Stadigh's video interview and Supplementary Financial Information are available at www.sampo.com/result.

Sampo will publish an on-line Annual Report 2010 in week 10. At the same time Corporate Governance Statement and Salary and Remuneration Report will be published.

 

Distribution:
NASDAQ OMX Helsinki
The principal media
Financial Supervisory Authority
www.sampo.com

GROUP FINANCIAL REVIEW      
       
FINANCIAL HIGHLIGHTS   1-12/2010 1-12/2009
       
GROUP      
Profit before taxes EURm 1,320 825
Return on equity (at fair value) % 21.8 55.7
Return on assets (at fair value) % 10.0 18.6
Equity/assets ratio % 29.8 28.6
Group solvency ¹) EURm 3,038 2,315
Group solvency ratio % 167.1 158.3
Average number of staff   6,914 7,311
       
PROPERTY & CASUALTY INSURANCE      
Premiums written before reinsurers' share EURm 4,189 3,888
Premiums earned EURm 3,894 3,643
Profit before taxes EURm 707 644.0
Return on equity (at current value) % 39.8 53.2
Risk ratio ²) % 69.1 68.0
Cost ratio ²) % 23.7 24.1
Loss ratio ²) % 77.1 76.2
Loss ratio excl. unwinding of discount ³) % 75.6 74.6
Expense ratio ²) % 17.2 17.6
Combined ratio % 94.3 93.8
Combined ratio excl. unwinding of discount % 92.8 92.1
Average number of staff   6,392 6,807
       
LIFE INSURANCE      
Premiums written before reinsurers' share EURm 1,117 809
Profit before taxes EURm 142 121
Return on equity (at current value) % 36.2 97.6
Expense ratio % 112.1 111.0
Average number of staff   470 450
       
HOLDING      
Profit before taxes EURm 474 36
Average number of staff   52 54
       
PER SHARE KEY FIGURES      
Earnings per share EUR 1.97 1.14
Earnings per share, incl. other      
comprehensive income EUR 3.22 5.88
Capital and reserves per share EUR 15.83 13.56
Net asset value per share EUR 17.79 14.63
Adjusted share price, high EUR 20.71 18
Adjusted share price, low EUR 16.13 8.63
Market capitalisation EURm 11,254 9,553

 

¹)  The Group solvency is calculated according to the consolidation method defined in Chapter 3 of the Act on the Supervision of Financial and Insurance Conglomerates (2004/699).

²) The key figures for P&C Insurance are based on activity based costs and cannot, therefore, be calculated directly from the consolidated income statement. The result analysis of P&C insurance is presented in note 13.

In calculating the per share key figures, the number of shares used at the balance sheet date and as the average number of shares was 561,282,390.

The valuation differences on investment property have been taken into account in calculating the return on assets, return on equity, equity/assets ratio and net asset value per share. The tax component includes the tax corresponding to the result for the period, and the deferred tax liability related to valuation differences on investment property.

The total comprehensive income has been used in the calculation of the return on assets and return on equity.

The key figures for the insurance business have been calculated in accordance with the decree issued by the Ministry of Finance and the specifying regulations and instructions of the Finance Supervisory Authority (former Insurance Supervisory Authority).

 

CALCULATION OF KEY FIGURES  
   
Return on equity (fair values), %  
+ total comprehensive income  
+ valuation differences on investments less deferred tax x 100 %
+ total equity  
+ valuation differences on investments less deferred tax  
(average of values 1 Jan. and the end of reporting period)  
   
Return on assets (at fair values), %  
+ operating profit  
+ other comprehensive income before taxes  
+ interest and other financial expense  
+ calculated interest on technical provisions  
+ change in valuation differences on investments x 100 %
+ balance sheet, total  
-  technical provisions relating to unit-linked insurance  
+ valuation differences on investments  
(average of values on 1 Jan. and the end of the reporting period)  
   
Equity/assets ratio (at fair values), %  
+ total equity  
+ valuation differences on investments after deduction of deferred tax x 100 %
+ balance sheet total  
+ valuation differences on investments  
   
Risk ratio for P&C Insurance, %  
+ claims incurred  
- claims settlement expenses x 100 %
insurance premiums earned  
      
Cost ratio for P&C Insurance, %  
+ operating expenses  
+ claims settlement expenses x 100 %
insurance premiums earned  
   
Loss ratio for P&C Insurance, %  
claims incurred x 100 %
insurance premiums earned  
   
Expense ratio for P&C Insurance, %  
operating expenses x 100 %
insurance premiums earned  
   
Combined ratio for P&C Insurance, %  
Loss ratio + expense ratio  
   
Expense ratio for life insurance, %  
+ operating expenses before change in deferred acquisition costs  
+ claims settlement expenses x 100 %
expense charges  
   
Per share key figures  
   
Earnings per share  
profit for the financial period attributable to the parent  
company's equity holders  
adjusted average number of shares  
   
Equity per share  
equity attributable to the parent company's equity holders  
adjusted number of shares at the balance sheet date  
   
Net asset value per share  
+ equity attributable to the parent company's equity holders  
+ valuation differences on listed associates in the Group  
+ valuation differences after the deduction of deferred taxes  
adjusted number of shares at balance sheet date  
   
Market capitalisation  
number of shares at the balance sheet date  
x closing share price at the balance sheet date  

 

GROUP QUARTERLY INCOME STATEMENT          
           
EURm 10-12/2010 7-9/2010 4-6/2010 1-3/2010 10-12/2009
           
Insurance premiums written 1,127 1,007 1,198 1,764 1,077
Net income from investments 346 310 163 363 259
Other operating income 11 6 6 3 6
           
Claims incurred -886 -855 -874 -918 -792
Change in liabilities for insurance and investment contracts -62 25 26 -759 -61
Staff costs -133 -135 -124 -135 -134
Other operating expenses -162 -125 -139 -121 -130
           
Finance costs -33 -35 -29 -35 -25
Share of associates' profit/loss 152 140 106 124 0
           
Profit for the period before taxes 361 338 334 287 199
           
Taxes -59 -55 -62 -41 -51
           
Profit for the period 302 284 273 245 148
           
Other comprehensive income for the period          
Exchange differences on translating foreign operations 43 58 30 83 -8
Available-for-sale financial assets 146 311 -179 328 -189
Cash flow hedges -1 -2 -4 -2 -3
Share of other comprehensive income of associates 10 1 9 27 -
Income tax relating to components of other comprehensive income -38 -81 48 -85 -50
Other comprehensive income for the period, net of tax 161 288 -96 351 -250
           
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD, NET OF TAX 463 571 177 596 -102
           
Profit attributable to          
  Owners of the parent 302 284 273 245 148
  Non-controlling interests 0 0 0 0 0
           
Total comprehensive income attributable to          
  Owners of the parent 463 571 177 596 -101
  Non-controlling interests 0 0 0 0 0

 

CONSOLIDATED COMPREHENSIVE INCOME STATEMENT
       
EURm Note 1-12/2010 1-12/2009
       
Insurance premiums written 1 5,096 4,479
Net income from investments 2 1,183 1,155
Other operating income   26 20
       
Claims incurred 3 -3,533 -3,105
Change in liabilities for insurance and investment contracts   -769 -633
Staff costs 4 -527 -510
Other operating expenses   -547 -495
       
Finance costs   -131 -87
Share of associates' profit/loss   523 1
       
Profit before taxes   1,320 825
       
Taxes   -217 -184
       
Profit for the period   1,104 641
       
Other comprehensive income for the period      
Exchange differences   214 123
Available-for-sale financial assets   605 2,989
Cash flow hedges   -9 -3
Share of other comprehensive income of associates   48 -
Income tax relating to components of other comprehensive income   -156 -326
Other comprehensive income for the period, net of tax   703 2,782
       
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD   1,807 3,423
       
Profit attributable to      
  Owners of the parent   1,104 641
  Non-controlling interests   0 0
       
Total comprehensive income attributable to      
  Owners of the parent   1,807 3423
  Non-controlling interests   0 0
       
Basic earnings per share (eur)   1.97 1.14
       
       
CONSOLIDATED BALANCE SHEET      
       
EURm Note 12/2010 12/2009
       
Assets      
Property, plant and equipment   29 34
Investment property   122 124
Intangible assets 5 742 688
Investments in associates   5,699 5,172
Financial assets 6, 7 17,508 15,479
Investments related to unit-linked insurance contracts 8 3,127 2,366
Tax assets   68 81
Reinsurers' share of insurance liabilities   514 481
Other assets   1,515 1,439
Cash and cash equivalents   527 771
Total assets   29,851 26,635
       
Liabilities      
Liabilities for insurance and investment contracts 9 13,749 13,014
Liabilities for unit-linked insurance and investment contracts 10 3,124 2,359
Financial liabilities 11 2,187 2,098
Tax liabilities   640 500
Provisions   36 35
Employee benefits   105 104
Other liabilities   1,124 912
Total liabilities   20,965 19,022
       
Equity      
Share capital   98 98
Reserves   1,530 1,530
Retained earnings   6,459 5,889
Other components of equity   799 96
Equity attributable to owners of the parent   8,886 7,613
Non-controlling interests   0 0
Total equity   8,886 7,613
       
Total equity and liabilities   29,851 26,635

 

STATEMENTS OF CHANGES IN EQUITY, IFRS
                   
EURm Sha-
re capital
Sha-
re
pre-
mium ac-
count
Le-
gal re-
serve
In-
vest-
ed un-
re-
strict-
ed equity
Re-
tain-
ed earn-
ings
Trans-
lation
of
foreign
ope-
rations *)
Avai-
lable-
for-
sale
 finan-
cial
 assets
**)
Cash
flow
hedges
***)
Total
                   
Equity at 1 Jan. 2009 98 1,161 370 0 5,688 -323 -2,375 11 4,631
                   
Changes in equity                  
Transfers between equity   -1,161 -366 1,527   1     0
Share-based payments         -1       -1
Acquisition of treasury shares         -1       -1
Recognition of undrawn dividends         11       11
Dividends         -449       -449
Total comprehensive income for the period       641 122 2,662 -2 3,422
                   
Equity at 31 Dec. 2009 98 0 4 1,527 5,889 -200 287 9 7,613
                   
Changes in equity                  
Share-based payments         -1       -1
Recognition of undrawn dividends         10       10
Dividends         -561       -561
Share of associate's other changes                  
in equity         19       19
Total comprehensive income for the period       1,104 262 447 -6 1,807
                   
Equity at 31 Dec. 2010 98 0 4 1,527 6,459 62 734 3 8,886

 

*) The total comprehensive income includes also the share of the associate Nordea's other comprehensive income, in accordance with the Group's share holding. As Nordea's other comprehensive income comprise mainly the currency hedging of net investments and exchange differences, the Group's share of Nordea's other comprehensive income EURm 48 is also included in the Group's exchange differences in the statement of changes in equity.

**) The amount recognised in equity from available-for-sale financial assets for the period totalled EURm 615 (2,626).   The amount transferred to p/l amounted to EURm -168 (35). 

***) The amount recognised in equity from cash flow hedges for the period totalled EURm -6 (-2) .

The amount included in the translation, available-for-sale and cash flow hedge reserves represent other comprehensive income for each component, net of tax.

STATEMENT OF CASH FLOWS    
  1-12/2010 1-12/2009
     
Cash and cash equivalent at the beginning of the period 761 499
Cash flow from/used in operating activities 147 1,484
Cash flow from/used in investing activities 67 -1,771
Cash flow from/used in financing activities -448 549
   Dividends paid -554 -444
   Acquisition of treasury shares - -1
   Increase of liabilities 1,954 2,002
   Decrease of liabilities -1,848 -1,008
Cash and cash equivalent at the end of the period 527 761

 

The cash flow statement reports cash flows during the period classified by operating, investing and      financing activities. Cash flows are reported by using the indirect method. Cash flows from operating activities derive primarily from the principal revenue-producing activities. Cash flows from investments in subsidiaries and associated undertakings and those from investments in intangible assets and property, plant and equipment are presented in investing activities. Financing activities include cash flows resulting from changes in equity and borrowings in order to conduct the business. Cash and cash            equivalents consist of cash at bank and in hand and short-term deposits (under 3 months).         

NOTES

 

ACCOUNTING POLICIES

Sampo Group's consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS) adopted by the EU. The interim financial statements are presented in accordance with IAS 34 Interim Financial Reporting. In preparing the interim financial statements, the same accounting policies and methods of computation are applied as in the financial statements for 2009.

Sampo adopted various new or revised standards and interpretations at the beginning of the year 2010. These standards and interpretations are explained in Sampos accounting policies for the financial year 2009. The financial statements will be available on Sampo's website at www.sampo.com/annualreport.

The most significant of the adopted standards is the revised IFRS 3 Business combinations. The standard includes various significant changes regarding the accounting treatment of business combinations by allowing the company to measure the non-controlling interest at fair value instead of the proportionate interest in the acquiree's net assets. The choice affects the amounts of recognised goodwill and non-controlling interest.

CONSOLIDATED INCOME STATEMENT BY SEGMENT FOR TWELVE MONTHS ENDED
31 DECEMBER 2010
           
EURm P&C insurance Life insurance Holding Elimination Group
           
Insurance premius written 3,985 1,111 - - 5,096
Net income from investments 487 645 60 -9 1,183
Other operating income 25 0 16 -15 26
           
Claims incurred -2,689 -844 - - -3,533
Change in liabilities for insurance and investment contracts -91 -678 - - -769
Staff costs -479 -35 -13 - -527
Other operating expenses -501 -49 -11 15 -547
           
Finance costs -29 -8 -100 6 -131
Share of associates' profit/loss 0 0 523 - 523
           
Profit before taxes 707 142 474 -3 1,320
           
Taxes -189 -37 9 0 -217
           
Profit for the period 518 105 483 -3 1,104
           
Other comprehensive income for the period          
Exchange differences 214 0 - - 214
Available-for-sale financial assets 286 315 4 1 605
Cash flow hedges - -9 - - -9
Share of other comprehensive income of associates - - 48 - 48
Income tax relating to components of other comprehensive income -75 -80 -1 0 -156
Other comprehensive income for the period, net of tax 425 226 51 1 703
           
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 943 332 534 -2 1,807
           
Profit attributable to          
  Owners of the parent         1,104
  Non-controlling interests         0
           
Total comprehensive income attributable to          
  Owners of the parent         1,807
  Non-controlling interests         0
           
           
CONSOLIDATED INCOME STATEMENT BY SEGMENT FOR TWELVE MONTHS ENDED 31 DECEMBER 2009
           
EURm P&C insurance Life insurance Holding Elimination Group
           
Insurance premius written 3,677 803 - - 4,479
Net income from investments 394 629 109 24 1,155
Other operating income 23 0 13 -16 20
           
Claims incurred -2,477 -628 - - -3,105
Change in liabilities for insurance and investment contracts -33 -600 - - -633
Staff costs -470 -29 -11 - -510
Other operating expenses -439 -46 -17 7 -495
           
Finance costs -30 -8 -58 9 -87
Share of associates' profit/loss 0 0 - - 1
           
Profit before taxes 644 121 36 23 825
           
Taxes -159 -28 9 -6 -184
           
Profit for the period 485 93 45 17 641
           
Other comprehensive income for the period          
Exchange differences 123 0 - - 123
Available-for-sale financial assets 709 546 1,756 -23 2,989
Cash flow hedges - -3 - - -3
Income tax relating to components of other comprehensive income -191 -141 0 6 -326
Other comprehensive income for the period, net of tax 641 402 1,756 -17 2,782
           
TOTAL COMPREHENSIVE INCOME FOR THE PERIOD 1,127 495 1,801 0 3,423
           
Profit attributable to          
  Owners of the parent         641
  Non-controlling interests         0
           
Total comprehensive income attributable to          
  Owners of the parent         3,423
  Non-controlling interests         0

 

CONSOLIDATED BALANCE SHEET BY SEGMENT AT 31 DECEMBER 2010
           
EURm P&C insurance Life insurance Holding Elimina-tion Group
           
Assets          
Property, plant and equipment 19 5 5 - 29
Investment property 26 96 4 -4 122
Intangible assets 577 165 0 - 742
Investments in associates 11 0 5,688 - 5,699
Financial assets 11,226 5,745 3,101 -2,563 17,508
Investments related to unit-linked insurance contracts - 3,127 - - 3,127
Tax assets 50 - 18 0 68
Reinsurers' share of insurance liabilities 510 4 - - 514
Other assets 1,363 106 66 -20 1,515
Cash and cash equivalents 319 152 56 - 527
Total assets 14,101 9,400 8,938 -2,587 29,851
           
Liabilities          
Liabilities for insurance and investment contracts 9,340 4,410 - - 13,749
Liabilities for unit-linked insurance and investment contracts - 3,124 - - 3,124
Financial liabilities 512 126 1,741 -191 2,187
Tax liabilities 464 176 - - 640
Provisions 36 - - - 36
Employee benefits 105 - - - 105
Other liabilities 690 339 117 -22 1,124
Total liabilities 11,146 8,174 1,857 -213 20,965
           
Equity          
Share capital         98
Reserves         1,530
Retained earnings         6,459
Other components of equity         799
Equity attributable to owners of the parent         8,886
Non-controlling interests         0
Total equity         8,886
           
Total equity and liabilities         29,851
           
           
CONSOLIDATED BALANCE SHEET BY SEGMENT AT 31 DECEMBER 2009
           
EURm P&C insurance Life insurance Holding Elimina-tion Group
           
Assets          
Property, plant and equipment 23 5 5 - 34
Investment property 28 87 10 - 124
Intangible assets 521 167 0 - 688
Investments in associates 3 0 5,168 - 5,172
Financial assets 10,248 5,216 2,554 -2,538 15,479
Investments related to unit-linked insurance contracts - 2,366 - - 2,366
Tax assets 71 - 11 0 81
Reinsurers' share of insurance liabilities 477 4 - - 481
Other assets 1,265 133 76 -36 1,439
Cash and cash equivalents 292 68 412 - 771
Total assets 12,927 8,047 8,235 -2,574 26,635
           
Liabilities          
Liabilities for insurance and investment contracts 8,583 4,431 - - 13,014
Liabilities for unit-linked insurance and investment contracts - 2,359 - - 2,359
Financial liabilities 524 132 1,609 -166 2,098
Tax liabilities 403 97 - - 500
Provisions 35 - - - 35
Employee benefits 104 - - - 104
Other liabilities 719 134 95 -36 912
Total liabilities 10,367 7,153 1,703 -202 19,022
           
Equity          
Share capital         98
Reserves         1,530
Retained earnings         5,889
Other components of equity         96
Equity attributable to owners of the parent         7,613
Non-controlling interests         0
Total equity         7,613
           
Total equity and liabilities         26,635
OTHER NOTES      
       
1 INSURANCE PREMIUMS      
       
P&C insurance      
  1-12/2010 1-12/2009  
Premiums from insurance contracts      
Premiums written, direct insurance 4,105 3,770  
Premiums written, assumed reinsurance 84 118  
Premiums written, gross 4,189 3,888  
Ceded reinsurance premiums written -204 -211  
P&C Insurance, total 3,985 3,677  
       
Change in unearned premium provision -94 -28  
Reinsurers' share 2 -5  
Premiums earned for P&C Insurance, total 3,894 3,643  
       
Life insurance      
  1-12/2010 1-12/2009  
Premiums from insurance contracts      
Premiums from contracts with discretionary participation feature 271 231  
Premiums from unit-linked contracts 376 273  
Premiums from other contracts 1 4  
Insurance contracts, total 648 508  
Assumed reinsurance 2 2  
Premiums from investment contracts      
Premiums from contracts with discretionary participation feature 1 20  
Premiums from unit-linked contracts 467 279  
Investment contracts, total 468 299  
Reinsurers' shares -6 -6  
Life insurance, total 1,111 803  
       
Single and regular premiums from direct insurance      
Regular premiums, insurance contracts 392 381  
Single premiums, insurance contracts 256 127  
Single premiums, investment contracts 468 299  
Total 1,115 807  
       
Group, total 5,096 4,479  
       
       
2 NET INCOME FROM INVESTMENTS      
       
P&C Insurance      
  1-12/2010 1-12/2009  
Financial assets      
Derivative financial instruments 28 55  
       
Financial assets designated as at fair value through p/l      
    Debt securities 7 28  
    Equity securities 3 10  
Total 9 38  
       
Loans and receivables 13 13  
       
Financial asset available-for-sale      
    Debt securities 446 411  
    Equity securities 73 -54  
Total 519 357  
       
Total financial assets 569 463  
       
Income from other assets -2 0  
       
Fee and commission expense -8 -6  
       
Expense on other than financial liabilities -16 -3  
       
Effect of discounting annuities -58 -59  
       
P&C insurance, total 487 394  
       
Life insurance      
  1-12/2010 1-12/2009  
Financial assets      
Derivative financial instruments -7 50  
       
Financial assets designated as at fair value through p/l      
    Debt securities 5 5  
    Equity securities 0 0  
Total 6 6  
       
Investments related to unit-linked contracts      
    Debt securities 48 43  
    Equity securities 284 314  
    Loans and receivables -1 0  
    Other financial assets 2 2  
Total 333 359  
       
Loans and receivables 4 4  
       
Financial asset available-for-sale      
    Debt securities 190 189  
    Equity securities 107 -5  
Total 297 184  
       
Total income from financial assets 631 604  
       
Other assets 5 20  
       
Fee and commission income, net 8 5  
       
Life insurance, total 645 629  
       
Holding      
  1-12/2010 1-12/2009  
Financial assets      
Derivative financial instruments 26 15  
       
Loans and other receivables 21 8  
       
Financial assets available-for-sale      
    Debt securities 10 15  
    Equity securities 2 62  
Total 11 77  
       
Other assets 2 1  
       
Fee income, net 1 8  
       
Holding, total 60 109  
       
Elimination items between segments -9 24  
       
Group, total 1,183 1,155  
       
       
3  CLAIMS INCURRED      
       
P&C insurance 1-12/2010 1-12/2009  
       
Claims paid -2,690 -2,437  
Reinsurers' share 116 103  
Claims paid, net -2,574 -2,333  
Change in provision for claims outstanding -106 -162  
Reinsurers' share -9 18  
P&C Insurance total -2,689 -2,477  
       
Life insurance 1-12/2010 1-12/2009  
       
Claims paid -782 -564  
Reinsurers' share 4 4  
Claims paid, net -778 -560  
Change in provision for claims outstanding -66 -67  
Reinsurers' share 0 0  
Life insurance, total -844 -628  
       
Group, total -3,533 -3,105  
       
       
4 STAFF COSTS      
       
P&C insurance 1-12/2010 1-12/2009  
       
Wages and salaries -340 -330  
Granted cash-settled share options -9 -4  
Pension costs -63 -74  
Other social security costs -68 -62  
P&C insurance, total -479 -470  
       
Life insurance 1-12/2010 1-12/2009  
       
Wages and salaries -27 -23  
Granted cash-settled share options -2 -1  
Pension costs -4 -3  
Other social security costs -3 -2  
Life insurance, total -35 -29  
       
Holding 1-12/2010 1-12/2009  
       
Wages and salaries -7 -7  
Granted cash-settled share options -4 -1  
Pension costs -1 -2  
Other social security costs -1 -1  
Holding, total -13 -11  
       
Group, total -527 -510  
                 

 

5 INTANGIBLE ASSETS    
     
P&C insurance 12/2010 12/2009
     
Goodwill 564 506
Customer relations - 6
Other intangible assets 13 8
P&C Insurance, total 577 521
     
Life insurance 12/2010 12/2009
     
Goodwill 153 153
Other intangible assets 12 14
Life insurance, total 165 167
     
Holding 12/2010 12/2009
     
Other intangible assets 0 0
     
Group, total 742 688
     
     
6 FINANCIAL ASSETS    
     
P&C insurance    
  12/2010 12/2009
     
Derivative financial instruments (Note 7) 63 84
Financial assets designated as at fair value through p/l    
   Debt securities 90 136
   Equity securities 2 27
Total 92 163
Loans and receivables    
   Loans 72 2
   Deposits with ceding undertakings 1 1
Total 73 3
Financial assets available-for-sale    
   Debt securities 9,226 8,797
   Equity securities 1,772 1,201
Total 10,997 9,998
P&C insurance, total 11,226 10,248
     
Life insurance    
  12/2010 12/2009
     
Derivative financial instruments (Note 7) 58 66
Financial assets designated as at fair value through p/l    
   Debt securities 61 46
   Equity securities 0 4
Total 61 50
Loans and receivables    
   Loans 25 24
   Deposits with ceding undertakings 1 2
Total 26 26
Financial assets available-for-sale    
   Debt securities 3,242 3,289
   Equity securities *) 2,357 1,785
Total 5,598 5,074
Life insurance, total 5,745 5,216
     
*) of which investments in interest funds 61 157
     
Holding    
  12/2010 12/2009
     
Derivative financial instruments (Note 7) 36 12
Loans and receivables    
   Deposits 1 1
Financial assets available-for-sale    
   Debt securities 659 135
   Equity securities 36 36
Total 695 172
Investments in subsidiaries 2,370 2,370
Holding, total 3,101 2,554
     
Elimination items between segments -2,563 -2,538
     
Group, total 17,508 15,479

 

7 DERIVATIVE FINANCIAL INSTRUMENTS            
             
P&C insurance   12/2010     12/2009  
    Fair value Fair value   Fair value Fair value
  Contract/ notional amount Assets Liabilities Contract/ notional amount Assets Liabilities
Derivatives held for trading            
Interest rate derivatives 970 8 0 849 22 0
Foreign exchange derivatives 3,963 54 75 3,365 62 88
Equity derivatives 2 1 - 1 - 0
Total 4,935 63 75 4,215 84 88
             
Derivatives held for hedging            
Fair value hedges 189 0 0 217 0 0
             
P&C Insurance, total 5,124 63 75 4,432 84 89
             
             
Life insurance   12/2010     12/2009  
    Fair value Fair value   Fair value Fair value
  Contract/ notional amount Assets Liabilities Contract/ notional amount Assets Liabilities
Derivatives held for trading            
Interest rate derivatives 1,277 30 3 1,406 51 3
Foreign exchange derivatives 1,874 25 9 852 4 29
Commodity derivatives - - 0 14 - 0
Total 3,151 54 12 2,272 54 32
             
Derivatives held for hedging            
Cash flow hedges 88 3 0 365 12 -
Fair value hedges 494 1 14 227 - -
Total 582 4 14 591 12 -
             
Life insurance, total 3,733 58 26 2,863 66 32
             
             
Holding   12/2010     12/2009  
    Fair value Fair value   Fair value Fair value
  Contract/ notional amount Assets Liabilities Contract/ notional amount Assets Liabilities
Derivatives held for trading            
Interest rate derivatives 1,075 29 - 975 7 -
Exchange derivatives - - - 48 1 0
Equity derivatives 95 7 10 42 4 7
Total 1,170 36 10 1,065 12 7

 

 

8 INVESTMENTS RELATED TO UNIT-LINKED INSURANCE    
         
Life insurance        
  12/2010 12/2009    
Financial assets as at fair value through p/l        
Debt securities 551 365    
Equity securities 2,430 1,923    
Loans and receivables 131 70    
Derivatives 15 8    
Life insurance, total 3,127 2,366    
         
         
9 LIABILITIES FOR INSURANCE AND INVESTMENT CONTRACTS    
         
P&C insurance        
  12/2010 12/2009    
Insurance contracts        
Provision for unearned premiums 1,845 1,668    
Provision for claims outstanding 7,494 6,915    
P&C Insurance, total 9,340 8,583    
         
Reinsurers' share        
Provision for unearned premiums 53 49    
Provision for claims outstanding 457 428    
P&C Insurance, total 510 477    
         
Life insurance        
  12/2010 12/2009    
Insurance contracts        
Liabilities for contracts with DPF        
   Provision for unearned premiums 2,465 2,513    
   Provision for claims outstanding 1,907 1,844    
Total 4,372 4,358    
Liabilities for contracts without DPF        
   Provision for unearned premiums 14 13    
   Provision for claims outstanding 0 0    
Total 14 13    
Total 4,386 4,371    
         
Assumed reinsurance        
   Provision for unearned premiums 1 1    
   Provision for claims outstanding 2 2    
Total 3 3    
         
Insurance contracts, total        
Provision for unearned premiums 2,479 2,528    
Provision for claims outstanding 1,909 1,846    
Total 4,388 4,374    
         
Investment contracts        
Liabilities for contracts with DPF        
   Provision for unearned premiums 22 57    
         
Liabilities for insurance and investment contracts, total        
Provision for unearned premiums 2,501 2,585    
Provision for claims outstanding 1,909 1,846    
Life insurance, total 4,410 4,431    
         
Recoverable from reinsurers        
Provision for unearned premiums 0 0    
Provision for claims outstanding 4 4    
Life insurance, total 4 4    
         
 

Investment contracts do not include a provision for claims outstanding.

 

Liability adequacy test does not give rise to supplementary claims.

 

Exemption allowed in IFRS 4 Insurance contracts has been applied to investment contracts with DPF or contracts with a right to trade-off for an investment contract with DPF.
These investment contracts have been valued like insurance contracts.

 
       
Group, total 13,749 13,014    
         
         
10 LIABILITIES FROM UNIT-LINKED INSURANCE AND INVESTMENT CONTRACTS  
         
Life insurance 12/2010 12/2009    
         
Unit-linked insurance contracts 2,381 1,961    
Unit-linked investment contracts 743 398    
Life insurance, total 3,124 2,359    
         
11 FINANCIAL LIABILITIES        
         
P&C insurance 12/2010 12/2009    
         
Derivative financial instruments (Note 7) 75 89    
         
Subordinated debt securities        
Subordinated loans 437 435    
         
P&C insurance, total 512 524    
         
Life insurance 12/2010 12/2009    
         
Derivative financial instruments (Note 7) 26 32    
         
Subordinated debt securities        
Subordinated loans 100 100    
         
Life insurance, total 26 132    
         
Holding 12/2010 12/2009    
         
Derivative financial instruments (Note 7) 10 7    
         
Debt securities in issue        
Commercial papers 575 466    
Bonds 1,026 962    
Total 1,601 1,429    
         
Subordinated debt securities        
Debentures - 37    
         
Other        
Pension loan 130 130    
Other - 6    
Total 130 136    
         
Holding, total 1,741 1,609    
         
Elimination items between segments -191 -166    
         
Group, total 2,187 2,098    
         
         
12 CONTINGENT LIABILITIES AND COMMITMENTS    
         
P&C insurance        
  12/2010 12/2009    
Off-balance sheet items        
Guarantees 57 19    
Other irrevocable commitments 27 69    
Total 84 88    
         
Assets pledged as collateral for liabilities or contingent liabilities        
  12/2010 12/2010 12/2009 12/2009
Assets pledged as collateral Assets pledged Liabilities/ commit- ments Assets pledged Liabilities/ commit- ments
Cash at balances at central banks 10 8 9 7
Investments        
- Investment securities 133 111 124 101
Total 142 118 133 108
         
Non-cancellable operating leases 12/2010 12/2009    
Minimum lease payments        
not later than one year 32 32    
later than one year and not later than five years 78 82    
later than five years 101 106    
Total 212 220    
         
Life insurance        
  12/2010 12/2009    
Off-balance sheet items        
Fund commitments 348 357    
         
  12/2010 12/2009    
Other commitments        
Acquisition of IT-software 2 0    
         
Non-cancellable operating leases 12/2010 12/2009    
Minimum lease payments        
not later than one year 2 2    
later than one year and not later than five years 6 7    
later than five years 0 1    
Total 8 10    
         
Holding        
  12/2010 12/2009    
Off-balance sheet items        
Fund commitments 1 3    
         
Assets pledged as collateral for liabilities or contingent liabilities        
  12/2010 12/2010 12/2009 12/2009
Assets pledged as collateral Assets pledged Liabilities/ commit- ments Assets pledged Liabilities/ commit- ments
Investments        
- Mortgaged collateral notes - - 15 6
         
Non-cancellable operating leases 12/2010 12/2009    
Minimum lease payments        
not later than one year 1 1    
later than one year and not later than five years 3 3    
later than five years 1 2    
Total 5 7    
         
         
13 RESULT ANALYSIS OF P&C INSURANCE BUSINESS    
         
  1-12/2010 1-12/2009    
         
Premiums earned 3,894 3,643    
Claims incurred -2,943 -2,717    
Operating expenses -671 -640    
Other technical income and expenses 0 0    
Allocated investment return transferred from the non-technical account 168 201    
Technical result 449 488    
Investment result 516 423    
Allocated investment return transferred to the technical account -226 -261    
Other income and expenses -32 -6    
Operating result 707 644    
         
         
14 SAMPO PLC'S INCOME STATEMENT AND BALANCE SHEET (FAS)    
         
INCOME STATEMENT        
  1-12/2010 1-12/2009    
         
Other operating income 17 14    
Staff expenses -13 -12    
Depreciation and impairment 0 0    
Other operating expenses -12 -18    
Operating profit -8 -15    
Finance income and expenses 710 538    
Profit before appropriations and income taxes 702 522    
Income taxes 9 9    
Profit for the financial period 710 531    
         
         
BALANCE SHEET 12/2010 12/2009    
         
ASSETS        
Non-current assets        
Intangible assets 1 1    
Property, plant and equipment 4 4    
Investments        
  Shares in Group companies 2,370 2,370    
  Receivables from Group companies 145 122    
  Shares in participating undertakings 5,304 5,168    
  Receivables from participating undertakings 150 -    
  Other shares and participations 40 41    
  Other receivables 365 14    
Receivables 120 98    
Cash and cash equivalents 56 412    
         
TOTAL ASSETS 8,553 8,229    
         
LIABILITIES        
Equity        
Share capital 98 98    
Fair value reserve 0 -3    
Invested unrestricted equity 1,527 1,527    
Other reserves 273 273    
Retained earnings 4,088 4,108    
Profit for the year 710 531    
Total equity 6,696 6,534    
         
Liabilities        
Long-term 1,155 1,129    
Short-term 702 567    
Total liabilities 1,857 1,696    
         
TOTAL LIABILITIES 8,553 8,229    
           

 

 

                                                                                   

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