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Reinsurance Market Report
Results for Year-End 2016
April 2017
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Contents
Key Findings ................................................................................................................................................. 1
Summary ....................................................................................................................................................... 2
Capital........................................................................................................................................................ 2
Return of Capital ........................................................................................................................................ 3
Return on Equity ........................................................................................................................................ 3
Underwriting .............................................................................................................................................. 4
Expense Ratios ......................................................................................................................................... 5
Catastrophe Loss ...................................................................................................................................... 5
Capital ........................................................................................................................................................... 6
Highlights for the INDEX............................................................................................................................ 6
Active Capital Management ...................................................................................................................... 7
Summary and Outlook ............................................................................................................................... 8
Earnings ........................................................................................................................................................ 9
Underwriting Performance .......................................................................................................................... 10
Premium Volumes ................................................................................................................................... 10
Combined Ratios ..................................................................................................................................... 11
Prior Year Loss Development .............................................................................................................. 12
Catastrophe Losses ............................................................................................................................. 13
Accident Year Performance, ex Catastrophe ...................................................................................... 15
Expense Ratios for the SUBSET ............................................................................................................. 15
Modest Investment Returns .................................................................................................................... 16
Appendices ................................................................................................................................................. 18
April 2017
Reinsurance Market Report – Year-End 2016
Key Findings
For the Willis Reinsurance Index* (INDEX):
■
Shareholders’ funds increased by 4.4% to USD 344.1B.
■
Aggregate net income for FY 2016 reduced to USD 26.6B (FY 2015: USD 30.3B).
■
Majority of net income was returned through dividends and buybacks of USD 16.4B.
■
Net income has been supported by realised investment gains of USD 7.0B (FY 2015: USD
7.7B).
■
Growth of shareholders’ funds was supported by USD 10.1B of unrealised investment gains
which were not reported within net income. This compares to unrealised investment losses of
USD 9.3B in 2015.
■
2016 headline return on equity (RoE) of 8.0% for the INDEX, down from 9.3% at FY 2015.
■
The reported combined ratio for the INDEX at FY 2016 increased to 94.4% (FY 2015: 91.4%).
For the SUBSET** within the INDEX that breaks out the relevant disclosure:
■
Reported RoE of 8.2% at FY 2016 for the SUBSET, down from 10.2% at FY 2015.
■
Underlying RoE for the SUBSET of 3.3% at FY 2016, down from 3.4% at FY 2015.
■
The FY 2016 reported combined ratio for the SUBSET increased to 92.9% (FY 2015: 89.3%).
■
Over the last 9 years, the aggregate expense ratio for the SUBSET has risen by 4.0
percentage points to 33.2% at FY 2016.
■
Profitability continues to be reliant on releases of prior year reserves which represent around
49% of net income.
Alternative capital increased to USD 75B*** from USD 70B at FY 2015.
Year-end 2017 results may be impacted by macro-economic volatility due to potential changes in the
US tax framework, the implementation of the EU-US Covered Agreement and the Brexit negotiations.
*- INDEX relates to those companies listed within Appendix 1 of this report. Merger and acquisition activity has resulted in the
exclusion of HCC Insurance Group and White Mountains from the INDEX. White Mountains has been replaced by Sirius.
**- SUBSET is defined as those companies that make the relevant disclosure in relation to cat losses and prior year reserve
releases. All constituents of the SUBSET are publicly listed groups that compose 58% of the aggregate capital INDEX
***- Capital Markets commentary provided by Willis Towers Watson
Securities http://www.willis.com/client_solutions/services/wcma/
April 2017
1
Reinsurance Market Report – Year-End 2016
Summary
Capital
For the INDEX:
■
Aggregate shareholders’ funds increased by 4.4% to USD 344.1B (FY 2015: USD 329.7B).
360
+26.6
350
+10.1
(2.4)
344.1
340
(16.4)
330
329.7
(3.5)
Shareholders' Equity
brought forward*
Adjustment **
320
310
300
Net income***
Buy backs /
Dividends
Unrealised investment Other (including
appreciation****
FX movement)
Shareholders' Equity
carried forward*****
*
As per latest financial statements issued since date of previous Willis Re report, generally as at year end December 31,
2015.
**
Removal of HCC Insurance Group and White Mountains from INDEX. White Mountains has been replaced by Sirius.
***
Net income of USD 26.6B includes a significant level of realised investment gains (USD 7.0B).
****
Unrealised investment appreciation that is not reported within net income.
*****
As per latest financial statements issued by March 31, 2017 generally as at year end December 31, 2016. Amlin and
CCR were yet to report their Year-End 2016 financial results as at the time of this publication; we include their year-end
2015 shareholders' equity within our INDEX total at the start and end of 2016.
■
Growth in shareholders’ funds was supported by net income of USD 26.6B (FY 2015: USD
30.3B).
■
Active capital management continues with USD 16.4B being returned through share
buybacks and dividends (FY 2015: USD 23.3B). The decrease was driven by a reduction in
dividends upstreamed by National Indemnity Co to USD 2.5B (FY 2015: USD 8.2B).
■
The USD 14.4B increase in shareholders’ funds was largely due to unrealised investment
gains of USD 10.1B which were not reported within net income.
■
The USD 3.5B adjustment is made to reflect the removal of HCC Insurance Group and White
Mountains from the INDEX. White Mountains has been replaced by Sirius.
■
Including other major regional and local reinsurers, and a pro-rated portion of capital within
major groups whose reinsurance portfolio is <10% of their total premium, we derive an
estimate of USD 374B of aggregate shareholders’ equity for the traditional reinsurance
market.
■
Including capital from alternative markets the figure of USD 374B increases by USD 75B to
approximately USD 449B (Year-end 2015: USD 427B).
■
If 100% of the capital within the major groups above is included the figure is estimated at USD
593B.
■
Including capital from alternative markets the figure of USD 593B increases by USD 75B to
approximately USD 668B (Year-end 2015: USD 623B).
2
April 2017
Reinsurance Market Report – Year-End 2016
Return of Capital
For the INDEX:
■
Share buybacks returned USD 5.8B of capital, equivalent to 1.8% of aggregate opening
shareholders’ equity (FY 2015: USD 5.5B, 1.6%).
■
USD 10.6B returned through ordinary or special dividends, or 3.2% of aggregate opening
shareholders’ funds (FY 2015: USD 17.8B, 5.2%).
■
A total of USD 16.4B was returned to shareholders, accounting for approximately 62% of net
income (FY 2015: 23.3B, 77%).
For the SUBSET:
■
Share buybacks returned USD 5.8B of capital, equivalent to 3.0% of aggregate opening
shareholders’ equity (FY 2015: USD 5.5B, 2.7%).
■
USD 6.0B returned through ordinary or special dividends, or 3.0% of aggregate opening
shareholders’ funds (FY 2015, USD 7.4B, 3.6%).
■
A total of USD 11.8B was returned to shareholders’, accounting for 78% of FY net income (FY
2015, USD 12.9B, 65%).
Reinsurers within both the INDEX and SUBSET continue to actively manage their capital, including
through new share buyback authorisations.
Return on Equity
For the INDEX:
■
Aggregate RoE of 8.0% for the INDEX, down from 9.3% at FY 2015.
■
The further deterioration in reported RoEs was driven by higher incidence of Natural
Catastrophe losses.
■
Investment yields were broadly flat at approximately 2.9%.
For the SUBSET:
■
As the RoE analysis for the SUBSET shows, the reported RoE was 8.2% (FY 2015: 10.2%).
■
If we normalise for a more typical catastrophe load (equivalent to a c. 4% impact on RoE) and
exclude the benefit provided by reserve releases, underlying profitability declines marginally
to 3.3% from 3.4% at FY 2015.
April 2017
3
Reinsurance Market Report – Year-End 2016
RoE analysis for the SUBSET
14.0%
12.0%
+1.4%
+0.9%
11.3%
10.0%
+2.6%
10.2%
-4.0%
8.0%
-4.0%
8.2%
-4.0%
-3.1%
6.0%
5.6%
-3.7%
4.0%
-3.5%
3.4%
3.3%
2.0%
0.0%
RoE, net of 4% (not 2.6%) Cat losses
and excluding PYD
Prior year development
Normalising for a 4% Cat Loss
Cat Loss
Reported RoE (net of Cat losses)
RoE, net of 4% (not 0.9%) Cat losses
and excluding PYD
Prior year development
Normalising for a 4% Cat Loss
Cat Loss
Reported RoE (net of Cat losses)
RoE, net of 4% (not 1.4%) Cat losses
and excluding PYD
Prior year development
Normalising for a 4% Cat Loss
Cat Loss
Reported RoE (net of Cat losses)
2014
2016
2015
Note: Recalibrated due to adjustment of methodology and composition of the INDEX.
Underwriting
For the INDEX:
■
The aggregate reported NWP rose by 2.2% to USD 256B (FY 2015: USD 251B).
■
Due to continued pricing pressure, the constituents of the INDEX continue to broaden their
underwriting platforms, including for specialty business such as agriculture and mortgage
insurance.
■
The reported combined ratio for the INDEX increased to 94.4% (FY 2015: 91.4%).
For the SUBSET:
■
The reported combined ratio for the SUBSET increased to 92.9% (FY 2015: 89.3%), driven
largely by an additional 3.2 percentage point impact from Natural Catastrophe losses.
■
The benefit provided by substantial reserve releases decreased only slightly to 6.3
percentage points (FY 2015: 6.7 percentage points).
■
Excluding Natural Catastrophe losses and prior year reserve releases, the Ex-Cat Accident
Year combined ratio increased remained broadly unchanged at 94.5%.
Combined Ratio analysis for the SUBSET
Weighted Average
SUBSET
Reported Combined Ratio
Favourable Development of Prior Years
Accident Year Combined Ratio
Catastrophe Loss
Ex-Cat Accident Year Combined Ratio
4
FY 2015
FY 2016
89.3%
92.9%
6.7%
6.3%
96.0%
99.2%
1.5%
4.7%
94.5%
94.5%
April 2017
Reinsurance Market Report – Year-End 2016
Expense Ratios
Impact of Expense Ratio Movement on RoE for the SUBSET (Base Year – 2007)
18.0%
Reported RoE
Expense Ratio Impact
16.0%
0.3%
14.0%
1.0%
12.0%
1.2%
1.7%
2.4%
0.8%
2.5%
10.0%
16.2%
8.0%
13.3%
6.0%
11.7%
10.0%
11.8%
11.5%
10.2%
0.8%
8.2%
4.0%
0.2%
2.0%
3.4%
1.6%
0.0%
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: SNL Financial and Willis Towers Watson Market Security
If each of the constituents of the SUBSET had been able to maintain an expense ratio at their
respective 2007 levels, the aggregate RoE of 8.2% reported at FY 2016 would have been
approximately 2.5 percentage points higher.
Catastrophe Loss
■
Global insured catastrophe losses increased to USD 54B (FY 2015: USD 38B), due to an
uptick in Natural Catastrophe losses to USD 46B (2015: USD 28B). (Swiss Re Sigma figures).
■
Following several periods of below average incidence, global insured Natural Catastrophe
losses have returned to a more normalised level in line with the 10 year average of USD 46B.
■
(Swiss Re Sigma figure).
■
Natural Catastrophe losses for the SUBSET increased by 179% to USD 5.4B.
■
This equates to 4.7% of aggregate net earned premium (NEP) (FY 2015: 1.5%) or
approximately a 2.6 percentage point impact after tax on the aggregate annualised RoE (FY
2015: 0.9 percentage points).
Note: For the purposes of this report the term catastrophe loss reflects generally large single event claims as reported by the
companies themselves. A catastrophe related loss may therefore not appear in our numbers as ‘Cat Loss’ unless it reaches a
value that exceeds the company’s own threshold for disclosure.
April 2017
5
Reinsurance Market Report – Year-End 2016
Capital
Highlights for the INDEX
■
Due to continued strong net income and significant unrealised investment gains, shareholders’
equity increased to USD 344.1B, a 4.4% increase from USD 329.7B at year-end 2015.
■
Reinsurers continue to actively manage capital levels, returning USD 16.4B to shareholders
through buy-backs and dividends.
■
A USD 3.5B adjustment is made to reflect the removal of HCC Insurance Group and White
Mountains from the INDEX. White Mountains has been replaced by Sirius.
■
The reported RoE for the INDEX decreased to 8.0% compared to 9.3% at FY 2015.
As Chart 1 shows for the INDEX, there was considerable variation in shareholders’ equity movements
on a company by company basis.
40%
35%
33.0%
Chart 1: Movement in consolidated shareholders’ equity, reported as at FY 2016 for the INDEX
FY 2015
0.5%
1.2%
0.5%
2.8%
1.4%
2.9%
4.9%
2.8%
5%
4.8%
5.2%
5.1%
5.9%
5.5%
6.3%
6.1%
6.7%
6.4%
7.5%
6.9%
8.0%
11.5%
7.5%
10%
9.7%
15%
15.6%
20%
FY 2016
12.8%
25%
19.0%
30%
-8.2%
-6.3%
-6.3%
-4.5%
-6.3%
-9.3%
-15%
-3.1%
-10%
-3.5%
-1.1%
0%
-5%
The 4.4% increase in shareholders’ equity was driven by continued strong net income of USD 26.6B,
albeit reduced from USD 30.3B at FY 2015 due to increased Natural Catastrophe losses. However,
this level of profitability continues to be dependent on substantial releases from prior year reserves. In
addition, significant support was provided by realised investment gains of USD 7.0B (FY 2015: USD
7.7B). Aggregate shareholders’ funds also benefited from a USD 10.1B increase in unrealised
investment gains which were not reported within net income. This increase in unrealised investment
gains was driven largely by a rise in the market value of National Indemnity Co’s US equity portfolio.
Partially offsetting these positive contributions, the adjustment of USD 3.5B reflected the removal of
HCC Insurance Group and White Mountains from the INDEX. White Mountains has been replaced by
Sirius. Reinsurers continued to return capital through share buybacks and dividends of USD 16.4B
(FY 2015: USD 23.3B).
6
April 2017
Reinsurance Market Report – Year-End 2016
Active Capital Management
Due to continued weak pricing, reinsurers have further broadened their underwriting platforms in order
to deploy capital to classes of business which they view as being more favourably rated. Reinsurers
have continued to moderate their exposure to catastrophe exposed business and increased capital
allocation to other classes of business which include primary, life and health and certain specialty
lines of business such as agriculture and mortgage insurance. Active capital management has
continued due to the persistent challenge of significant excess capacity.
Chart 2: Capital returned through share buybacks and ordinary and special dividends for the
INDEX
23.3%
25.0%
FY 2016
FY 2015
20.0%
8.7%
2.2%
2.7%
0.4%
0.4%
0.3%
0.5%
0.9%
3.3%
0.9%
2.4%
0.9%
1.2%
1.7%
1.5%
2.5%
2.1%
2.3%
2.2%
8.7%
2.8%
7.7%
2.8%
6.7%
3.5%
3.2%
4.4%
5.0%
4.4%
4.7%
4.7%
5.0%
5.0%
6.0%
7.2%
6.3%
7.5%
6.1%
6.9%
6.8%
7.1%
7.7%
7.6%
8.9%
7.3%
6.0%
7.8%
7.7%
7.6%
8.1%
7.6%
8.9%
8.2%
10.4%
9.0%
9.4%
10.0%
6.8%
5.0%
7.8%
10.9%
9.7%
10.0%
12.3%
14.7%
14.8%
12.2%
14.7%
15.0%
0.0%
The constituents of our INDEX returned USD 16.4B of capital through share buybacks and dividends
compared to USD 23.3B at FY 2015. Ordinary and special dividends accounted for USD 10.6B (FY
2015: USD 17.8B). The decrease was driven by a reduction in dividends upstreamed by National
Indemnity Co to USD 2.5B compared to the substantial USD 8.2B at FY 2015 which was attributable
to a one-off intragroup dividend paid by National Indemnity Co to its parent. Share buybacks
increased marginally to USD 5.8B (FY 2015: USD 5.5B).
As shown in Table 1, new authorisations for large share buyback programs continued in 2016. In the
remainder of 2017 we expect share buybacks to remain an important part of capital management for
the constituents of our INDEX due to the continued challenge of fully deploying capital at acceptable
levels of profitability.
April 2017
7
Reinsurance Market Report – Year-End 2016
Table 1: Recent announcements of share repurchase programs for the INDEX
Company
Everest Re
Validus
SCOR
Lancashire
Date
Action
Approved an increase in the share repurchase authorization by a further 5 million shares (3
Nov 19, 2014 million utilised).
Capacity outstanding
as % of Shareholders'
Equity, Dec 31, 2016
Feb 3, 2015 Announced a USD 750M repurchase authorization (USD 430M utilised).
AGM authorized a share repurchase program to repurchase up to 6.11% of its issued share
capital, such SCOR's treasury stock does not exceed 10% of it share capital. SCOR held 7.2
Apr 30, 2015 million treasury shares at Dec 31, 2016 = 3.7% of outstanding
Approved the renewal of the repurchase programme for up to 20 million shares (none
utilised). The repurchase programme is subject to renewal at the 2017 AGM for up to 10% of
Apr 30, 2015 the then issued common share capital.
4.94%
8.34%
6.26%
10.00%
WR Berkley
Jun 2, 2015 Increased its share repurchase authorization to 10 million shares (3.15 million utilised).
As of December 31, 2016, Alleghany had $379.2 million remaining under its share
Alleghany
Nov 1, 2015 repurchase authorization.
Commenced an authorization to repurchase up to USD 500M of its shares, anticipated to
occur through to April 19, 2018. The company has since repurchased 2.7 million shares
Allied World Apr 15, 2016 (3.1% ) USD 100M.
Authorized a buyback plan without ffixed expiration for up to USD 150M of common stock.
Argo
May 3, 2016 USD 130.3M remained outstanding as at December 31, 2016
Authorized a one year buyback plan on September 23, 2016 to repurchase up to 800,000 of
Fairfax
Sep 23, 2016 its subordinate voting shares. It had repurchased 30,732 shares by December 31.
Commenced share repurchases under the CHF 1.0B program mandated by its AGM on April
22, 2016. The full buyback, representing 3.2% of its stock, was concluded on February 9,
Swiss Re
Nov 4, 2016 2017.
Authorized a buyback plan that was initiated on January 1, 2017, for up to USD 1.0B of
Axis
Dec 9, 2016 common stock by December 31, 2017
Announced a share repurchase program without expiration date for up to USD 400M of
RGA Re
Jan 20, 2017 common stock.
Authorized a buyback plan to repurchase up to USD 250M of shares, through to February 8,
Aspen
Feb 8, 2017 2009
XL Catlin
Feb 17, 2017 Announces a share repurchase program for up to USD 1.0B of ordinary shares.
Renaissance
Announced a share repurchase program without expiration date for up to to USD 500M of
Feb 22, 2017 common stock.
Re
Announced a share repurchase program, for up to 11 million shares (3.5% of its share
capital) for a total consideration of EUR 1.0B. The program requires the authorization of it
Munich Re
Mar 15, 2017 AGM on 27 April 2016, and would be vaild for a period of one year thereafer.
5.65%
4.78%
11.27%
7.27%
3.33%
1.50%
15.94%
5.64%
6.85%
9.14%
10.27%
3.50%
Note: A number of other reinsurers have significant older authorisations with capacity still remaining including: Arch (USD
447M, 5.4%); Markel (USD 229M, 2.7%).
Summary and Outlook
In the remainder of 2017 the constituents of the INDEX face the continued challenge of substantial
excess capacity which has been further exacerbated by a USD 14.4B increase in shareholders’ equity
at FY 2016.
Reported RoEs decreased further due to the return to a normalised level of global insured Natural
Catastrophe losses. However, the impact on profitability was modest due to continued reliance on
substantial reserve releases in addition to the one-off support provided by significant realised
investment gains. Profitability also benefited from a reduction in insured Man-made Catastrophe
losses to USD 8B compared to USD 10B at FY 2015. (Swiss Re Sigma figures).
Looking ahead, RoEs may come under further pressure if reinsurers are unable to sustain the
quantum of reserve releases from which they have benefited in recent periods.
8
April 2017
Reinsurance Market Report – Year-End 2016
Earnings
For the INDEX:
■
Despite continued support from substantial reserve releases, the RoE for the INDEX, as show
in chart 3, weakened further to 8.0% (FY 2015: 9.3%) due to higher incidence of Natural
Catastrophe losses.
■
Investment yields for the INDEX remained broadly flat at 2.9%. However, Chart 12 shows that
the investment yields for a substantial portion of the INDEX were somewhat weaker than this
average.
■
The aggregate reported combined ratio for the INDEX increased to 94.4% (FY 2015: 91.4%).
■
Earnings were also supported by the one off benefit of realised investment gains of USD 7.0B
(FY 2015: USD 7.7B).
Chart 3: FY 2016 net income as % of average shareholders’ equity (RoE) for the INDEX
26.7%
30%
FY 2016
FY 2015
25%
FY 2016 INDEX
17.5%
20.2%
20%
8.0%
3.0%
3.8%
4.0%
5.5%
5.6%
5.8%
6.2%
6.4%
6.8%
7.1%
7.2%
7.3%
7.3%
7.3%
5%
7.8%
7.9%
8.2%
8.4%
8.5%
8.8%
9.4%
9.5%
9.9%
9.9%
10.1%
10.5%
12.2%
12.4%
10%
12.6%
13.7%
13.7%
15%
0%
-4.9%
-4.7%
-5%
-10%
For the SUBSET:
■
Due to higher Natural Catastrophe losses, the reported RoE of the SUBSET weakened
further to 8.2% compared with 10.2% at FY 2015.
■
This result continued to rely on substantial reserve releases which provided a 3.5 percentage
point uplift to RoE (FY 2015: 3.7 percentage points).
■
Reported RoEs benefited from substantial realised investment gains which were driven by
strong increases in the market value of equities. Going forward, RoEs may come under
further pressure if realised investment gains reduce from this high level.
■
Although global insured Natural Catastrophe losses have returned to a normalised level, they
remained within the aggregate budgeted Natural Catastrophe loss for the year.
Due to continued pricing pressure, reinsurers continue to broaden their underwriting platforms,
including for specialty business such as agriculture and mortgage insurance.
April 2017
9
Reinsurance Market Report – Year-End 2016
Underwriting Performance
For the INDEX:
■
Achieving profitable growth remains challenging due to continued rate pressures. Portfolio rebalancing continued with reinsurers increasing capital allocation to primary, life and health
and certain specialty lines of business such as agriculture and mortgage insurance.
■
The premium levels for some of the constituents of the INDEX continue to benefit from large
tailored transactions.
■
Despite support provided by continued substantial reserve releases, combined ratios have
increased due to a return to a normalised level of Natural Catastrophe losses.
■
Reinsurers continued to moderate their capital allocation to catastrophe exposed business,
including for their U.S. business.
■
The challenge of increasing expense bases continues to add further pressure to earnings.
■
Nevertheless, profitability benefited from a reduction in insured Man-made Catastrophe
losses to USD 8B compared to USD 10B at FY 2015. (Swiss Re Sigma figures).
For the SUBSET:
■
Excluding Natural Catastrophe losses and prior year reserve releases, the Ex-Cat Accident
Year combined ratio remained broadly unchanged at 94.5%.
■
The expense ratio has increased marginally to 33.2% (FY 2015: 33.1%).
Weighted Average
SUBSET
Reported Combined Ratio
Favourable Development of Prior Years
Accident Year Combined Ratio
Catastrophe Loss
Ex-Cat Accident Year Combined Ratio
FY 2014
FY 2015
FY 2016
88.5%
89.3%
92.9%
5.7%
6.7%
6.3%
94.2%
96.0%
99.2%
2.6%
1.5%
4.7%
91.6%
94.5%
94.5%
Premium Volumes
Chart 4 shows that FY 2016 net written premium (NWP) for the INDEX increased by approximately
2.2% from FY 2015. We continue to see significant variation between the constituents of the INDEX.
Factors influencing this growth include:
■
A number of the INDEX constituents have reported significant growth as a result of mergers
or acquisitions over the year, including XL Catlin (acquired Catlin), Endurance (Montpelier
Re), Fairfax (Brit) and Renaissance Re (Platinum).
■
We have continued to see some of the larger constituents of the INDEX achieving premium
growth through significant individual transactions, including whole account quota shares and
retrospective transactions for certain casualty lines of business.
■
The continued challenge of achieving profitable growth has seen some reinsurers reduce their
top line, including through reduced net exposure to U.S. catastrophe business.
■
The INDEX constituents continue to broaden their underwriting platforms to target growth in
certain classes of business which include primary, life and health and certain specialty lines of
business such as agriculture and mortgage insurance.
■
A number of reinsurers reported reduced premium volumes including Munich Re, Lancashire,
Partner Re and Allied World.
10
April 2017
Reinsurance Market Report – Year-End 2016
Chart 4: FY 2016 movement in net written premium for the INDEX
35%
28.8%
30%
FY 2016
FY 2015
18.2%
20%
FY 2016 INDEX
18.5%
21.5%
25%
0.3%
1.7%
2.1%
2.7%
2.9%
3.8%
4.1%
4.1%
4.8%
5%
5.6%
5.8%
7.0%
7.1%
7.6%
7.9%
8.2%
8.4%
8.5%
10.3%
10%
10.7%
11.3%
13.4%
13.6%
13.7%
15%
2.2%
0%
-5.3%
-7.9%
-5.0%
-4.8%
-2.4%
-10%
-2.0%
-1.7%
-5%
Combined Ratios
Despite a normalisation in the level of Natural Catastrophe losses, reported combined ratios remained
solid in the aggregate due to continued substantial support from reserve releases.
For the INDEX:
■
The reported combined ratio increased to 94.4% (FY 2015: 91.4%) due to higher incidence of
Natural Catastrophe losses.
■
This level of profitability remained heavily reliant on substantial reserve releases and also
benefitted from the one off support provided by significant realised investment gains.
For the SUBSET:
■
The reported combined ratio for the SUBSET increased to 92.9% (FY 2015: 89.3%), largely
due to an additional 3.2 percentage point impact from Natural Catastrophe losses.
■
The benefit provided by substantial reserve releases decreased only slightly to 6.3
percentage points (FY 2015: 6.7 percentage points). Further detailed analysis indicates an
acceleration of reserve releases in Q4 2016 after a slowdown in the first half of the year.
■
Excluding Natural Catastrophe losses and prior year reserve releases, the Ex-Cat Accident
Year combined ratio remained broadly unchanged at 94.5%.
■
Continued pockets of adverse reserve development were reported by a number of reinsurers,
including for US asbestos and certain casualty classes of business.
■
The March 2017 changes to U.K.-specific discount rates (in the government’s actuarial
“Ogden Tables”) have caused some reserve increases for certain reinsurers. Further impact
may be felt in 2017.
Chart 5 shows the reported combined ratio for the INDEX constituents at FY 2016 compared to FY
2015. The reported combined ratio increased to 94.4% (FY 2015: 91.4%) due to higher incidence of
Natural Catastrophe losses. We would note that this level of profitability remained heavily reliant on
substantial reserve releases and also benefitted from the one off support provided by significant
realised investment gains.
April 2017
11
Reinsurance Market Report – Year-End 2016
Chart 5: FY 2016 reported combined ratios for the INDEX
116.0%
120%
FY 2016
FY 2015
FY 2016 INDEX
103.6%
94.4%
76.5%
79.7%
84.9%
82.0%
84.2%
85.0%
84.4%
88.8%
86.9%
82.9%
81.5%
83.4%
87.0%
88.1%
87.0%
89.0%
89.5%
89.9%
89.0%
91.9%
89.0%
92.0%
89.9%
92.5%
95.5%
92.5%
85.6%
87.4%
91.1%
93.1%
93.5%
90%
93.6%
94.4%
93.7%
92.0%
94.2%
93.7%
94.3%
95.1%
89.7%
93.2%
95.2%
95.7%
94.7%
95.9%
95.1%
96.2%
95.2%
96.2%
94.0%
96.5%
91.9%
90.8%
94.1%
96.7%
98.6%
97.4%
100%
98.1%
97.3%
98.8%
102.4%
104.7%
109.0%
107.4%
110.0%
110%
80%
72.1%
72.5%
64.7%
70%
60%
In the subsections below we discuss the key components of the combined ratio for the SUBSET:
■
Impact of prior year loss reserve development
■
Catastrophe loss component
■
Underlying accident year combined ratio (i.e. excluding the above two components).
Prior Year Loss Development
At FY 2016 the aggregate combined ratio for the SUBSET benefited by 6.3 percentage points due to
continued significant reserve releases (FY 2015: 6.7 percentage points). Chart 6 shows the effect of
reserve releases on the SUBSET:
Chart 6: Prior year reserve development as % NEP for the SUBSET
25.0%
20.5%
FY 2015
FY 2016 SUBSET
8.2%
6.6%
5.1%
6.3%
0.8%
0.5%
0.8%
2.4%
2.4%
2.6%
3.0%
1.2%
3.8%
3.1%
5.0%
3.3%
4.2%
6.3%
4.9%
5.6%
8.3%
6.5%
5.1%
7.6%
6.9%
7.4%
6.6%
7.9%
6.3%
7.8%
8.5%
9.4%
10.0%
12.3%
13.6%
9.6%
10.1%
10.4%
10.2%
11.6%
11.7%
13.1%
14.3%
12.7%
16.4%
17.6%
15.0%
19.0%
17.6%
20.0%
FY 2016
0.0%
12
April 2017
Reinsurance Market Report – Year-End 2016
Although the trend for substantial reserve releases continued, further pockets of adverse reserve
development were reported by a number of reinsurers at FY 2016, including for US asbestos and
certain casualty classes of business.
Significant reserve releases from Munich Re and Hannover Re (owing to specific local requirements)
made a significant contribution to total reserve releases for the SUBSET.
The SUBSET constituents have generated over 49% of net income through reserve releases. Further
detailed analysis indicates an acceleration of reserve releases in Q4 2016 after a slowdown in the first
half of the year.
Chart 7: Reserve Release Development across the SUBSET
Aggregate Amount of Reserve Release (USDM)
8,000
PYD as % of Net Income
7,885
7,631
6,853
7,000
6,861
7,385
200%
6,837
160%
6,000
5,303
5,000
125.0%
120%
4,357
4,000
80%
3,000
2,000
33.5%
32.2%
41.8%
35.5%
31.7%
2013
2014
49.2%
40%
22.7%
1,000
-
0%
2009
2010
2011
2012
2015
2016
Note: Aggregate reserve release calculated before tax. (H1 2016 reserve release estimate was 29.0% of aggregate net income
on an after-tax basis accelerating to 42% for FY 2016).
Catastrophe Losses
Global insured catastrophe losses increased to USD 54B (2015: USD 38B), due to an uptick in
Natural Catastrophe losses to USD 46B (2015: USD 28B). (Swiss Re Sigma figures). Following
several periods of below average incidence, global insured Natural Catastrophe losses have returned
to a normalised level in line with the 10 year average of USD 46B. Man-made Catastrophe losses
reduced to USD 8B compared to USD 10B at FY 2015. Although global insured Natural Catastrophe
losses have returned to a normalised level, they remained within the aggregate budgeted Natural
Catastrophe loss for the year.
As shown in Table 2, the costliest events included the Kumamoto earthquake in Japan, hurricane
Matthew, flooding in Belgium, France and Germany, and the Fort McMurray fires in Canada.
April 2017
13
Reinsurance Market Report – Year-End 2016
Table 2: Major Losses FY 2016
(Insured loss estimate USD millions)
Natural Catastrophe Losses
Date
Description
Estimate
14-16 April
Japan Earthquake – Kumamoto Prefecture
5,000
1-8 October
Hurricane Matthew, US, Caribbean
4,000
12 - 14 August
South Louisiana Flooding, US
3,100
10 - 12 April
Severe hailstorm in San Antonio, Texas
3,000
28 May - 3 June
Floods – France, Belgium, Germany
2,100 – 2,900
1 May - 13 June
Fort McMurray wildfires, Canada
2,000 – 2,700
13 November
Earthquake in Kaikoura, New Zealand
1,700 – 2,400
23 -24 March
North Texas hailstorm, US
23-24 February
Tornadoes – U.S. Southern & Mid-Atlantic states
767
1,700
29 April – 3 May
Thunderstorms – U.S. Texas, Louisiana, Arkansas, Oklahoma and Mississippi
753
13-18 March
Hail Storms – U.S. Southern, Central & European states
692
14 April
Ecuador Earthquake – Esmeraldas province
500
7-14 March
U.S. Floods – Louisiana, Texas, Arkansas and Mississippi
295
Large Man-Made Losses
Estimate
Date
Description
17 October
Explosion at one of BASF's major chemical plants in Germany
400
20 April
Pemex – Mexico petrochemical plant explosion
386
13 May
Tullow’s Jubilee Oil field technical fault
345
285
1 September
SpaceX Falcon 9 rocket explosion
3 August
Emirates Flight 521 crash-landed at Dubai International Airport
96
22 April
The RoomPlace's warehouse fire in Chicago
70
19 March
FlyDubai Flight 981 crash over Russia
49
Loss estimates shown are taken from public sources and should not be taken as confirmation by Willis Towers Watson of
reported losses
As shown in Chart 8, the weighted average combined ratio of the SUBSET included 4.7 percentage
points due to catastrophe losses (FY 2015: 1.5 percentage points).
Chart 8: Catastrophe loss component of combined ratio as % NEP for the SUBSET
10.0%
8.7%
8.7%
9.0%
FY 2016
FY 2015
4.7%
3.2%
3.9%
4.1%
4.3%
1.0%
1.7%
1.0%
1.5%
2.2%
2.4%
1.0%
1.7%
1.2%
1.8%
0.9%
1.5%
1.9%
2.5%
1.9%
2.2%
2.7%
1.3%
0.0%
0.0%
1.0%
1.8%
2.0%
4.4%
3.7%
4.0%
3.0%
4.5%
5.0%
4.5%
4.6%
5.2%
5.5%
5.5%
5.5%
6.2%
6.7%
FY 2016 SUBSET
5.0%
6.0%
7.0%
6.7%
7.0%
7.3%
8.0%
0.0%
14
April 2017
Reinsurance Market Report – Year-End 2016
Accident Year Performance, ex Catastrophe
Excluding Natural Catastrophe losses and prior year reserve releases, the accident year combined
ratio remained broadly unchanged at 94.5%.
Chart 9: Ex Catastrophe accident year combined ratios for the SUBSET
120%
FY 2016
FY 2016 SUBSET
94.5%
82.8%
85.3%
88.9%
87.6%
93.3%
89.5%
90%
93.9%
90.5%
93.1%
90.5%
91.3%
92.4%
93.5%
93.1%
97.6%
93.2%
95.7%
94.0%
91.1%
94.1%
95.6%
94.7%
92.6%
94.8%
92.3%
95.7%
95.8%
96.4%
97.1%
96.7%
94.6%
96.8%
99.7%
96.9%
97.4%
97.2%
99.4%
98.3%
98.2%
98.6%
100%
FY 2015
97.4%
99.2%
105.4%
105.1%
106.1%
106.8%
110%
71.3%
75.5%
80%
70%
60%
Expense Ratios for the SUBSET
The expense ratio has increased marginally to 33.2% (FY 2015: 33.1%). The aggregate expense ratio
for the SUBSET has risen by 4.0 percentage points over the last 9 years.
Chart 10: Weighted Average Expense Ratio for the SUBSET
34.0%
33.1%
33.2%
2015
2016
33.0%
32.1%
32.0%
31.2%
31.0%
30.7%
30.7%
2010
2011
30.8%
29.9%
30.0%
29.6%
29.2%
29.0%
28.0%
2007
2008
2009
2012
2013
2014
Source: SNL Financial and Willis Towers Watson Market Security
■
The factors outlined in our year-end 2015 report remain relevant with overall expense ratios
increasing based upon the upward pressure in expenses and the continued reduction in
reinsurance premiums.
■
If each of the constituents of the SUBSET had been able to maintain an expense ratio at their
respective 2007 levels, the aggregate RoE of 8.2% reported at FY 2016 would have been
approximately 2.5 percentage points higher.
April 2017
15
Reinsurance Market Report – Year-End 2016
Chart 11: Impact of Expense Ratio Movement on RoE (Base Year – 2007) for the SUBSET
18.0%
Reported RoE
Expense Ratio Impact
16.0%
0.3%
14.0%
1.0%
12.0%
1.2%
1.7%
2.4%
0.8%
2.5%
10.0%
8.0%
16.2%
13.3%
6.0%
11.7%
10.0%
11.8%
11.5%
10.2%
0.8%
8.2%
4.0%
0.2%
2.0%
3.4%
1.6%
0.0%
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: SNL Financial and Willis Towers Watson Market Security
Modest Investment Returns
As shown in Chart 12, the weighted average investment return for the INDEX, excluding realised and
unrealised gains, remained unchanged at 2.9%. This yield benefits from higher than average returns
from RGA and Mapfre whose investment portfolios reflect their significant Life business, and from
certain reinsurers with significant emerging markets exposure. We would note that with the exception
of WR Berkley and the Berkshire Hathaway subsidiaries, the investment yield achieved by the nonLife focused reinsurers in the U.S. and Europe was below the INDEX average at approximately 2.0%.
A number of reinsurers with shorter tail portfolios have seen an uptick in their investment income
yields. However, the investment returns of those reinsurers with longer duration portfolios remained
under greater pressure as they continued to replace maturing investments with lower yielding bonds.
The latter part of 2016 was notable for a strong increase in equity markets which resulted in significant
realised gains for certain reinsurers with higher than average exposure to equities. In addition, much
of the increase in unrealised gains for the INDEX was also due to rising equity values. A large
proportion of these unrealised gains were due to a rise in value of National Indemnity’s equity
holdings.
Looking ahead, investment yields remain under pressure due to a continuation of the prolonged
period of low interest rates since the financial crisis. However, some relief will be provided by the
increases in US interest rates in December 2016 and March 2017. As weak pricing continues to
pressurise underwriting returns, it remains to be seen if constituents of the INDEX will seek to
increase investment risk materially.
16
April 2017
Reinsurance Market Report – Year-End 2016
Chart 12: Investment yield (net investment income as % of cash and invested assets) for the
INDEX
1.2%
1.4%
1.4%
1.4%
2.8%
1.5%
1.5%
1.6%
2.1%
1.6%
1.5%
1.7%
1.3%
1.8%
2.1%
1.8%
1.7%
1.9%
2.0%
1.9%
1.9%
2.0%
1.5%
2.0%
2.2%
2.0%
1.9%
2.0%
2.1%
2.1%
2.2%
2.1%
1.9%
2.3%
2.3%
2.4%
2.6%
2.4%
2.1%
2.4%
2.4%
2.5%
2.9%
2.6%
2.6%
2.7%
2.6%
2.7%
2.0%
2.0%
17
April 2017
2.9%
3.0%
2.7%
3.1%
2.7%
2.8%
3.0%
3.9%
3.2%
3.9%
3.3%
3.2%
3.3%
3.7%
3.7%
3.9%
3.9%
4.0%
3.9%
4.2%
4.2%
4.4%
4.4%
4.0%
FY 2016 INDEX
13.7%
13.7%
5.0%
FY 2015
7.0%
FY 2016
6.0%
1.0%
0.0%
Reinsurance Market Report – Year-End 2016
Appendices
1. Full Year 2016 results summary for the Willis Reinsurance Index
WILLIS TOWERS WATSON - MARKET SECURITY GROUP
Group Consolidated 2016 Results Table
Consolidated
Data
(Millions)
Shareholders' Equity
Dec-31 Dec-31 Dec-31
Notes
Ccy
2016
2015
2014
Net Written Premium
Net Income
Combined ratio
∆
FY
FY
FY
∆
FY
FY
FY
∆
% Sh Equity*
FY
FY
FY
∆
FY
2016
2015
2014
FY
2016
2015
2014
FY
FY 2016 FY 2015
2016
2015
2014
FY
African Re
USD
-
780
737
593
624
-
104
119
-
13.7%
-
86.9%
88.8%
Alleghany
USD
7,940
7,555
7,473
5.1%
5,092
4,489
4,498
13.4%
457
560
679
-18.5%
5.9%
7.5%
91.9%
89.0%
88.8%
+2.9%
Allied World
USD
3,552
3,533
3,778
0.5%
2,256
2,448
2,322
-7.9%
255
84
490
204.3%
7.2%
2.3%
96.2%
95.1%
85.2%
+1.1%
1,846
1,783
2,445
2,296
237
237
13.0%
-
89.0%
89.0%
Amlin
(5)
GBP
-
Arch Capital
USD
8,254
6,205
6,130
33.0%
4,031
3,818
3,892
5.6%
693
538
834
28.8%
9.6%
8.7%
89.9%
89.5%
87.2%
+0.4%
ARGO
USD
1,793
1,668
1,647
7.5%
1,440
1,402
1,368
2.7%
147
163
183
-10.1%
8.5%
9.8%
96.2%
95.2%
96.2%
+1.0%
791
844
124
373
-38
20
-
-4.7%
-
112.0%
108.0%
Asia Capital Re
(5)
USD
Aspen
USD
3,647
3,419
3,419
6.7%
2,594
2,646
2,515
-2.0%
203
323
356
-37.0%
5.8%
9.5%
98.1%
91.9%
91.7%
+6.2%
Ax is Capital
USD
6,272
5,867
5,821
6.9%
3,753
3,675
3,907
2.1%
513
642
811
-20.0%
8.5%
11.0%
95.9%
94.7%
91.6%
+1.2%
(1)
USD
1,484
1,441
1,343
2.9%
1,854
1,713
1,733
8.2%
251
249
218
0.8%
17.2%
17.9%
89.0%
87.0%
89.0%
+2.0%
(1)(4)(5)
EUR
2,085
1,969
1,287
1,323
216
193
-
10.7%
-
76.8%
82.6%
(1)
CNY
71,182
70,187
53,893
1.4%
83,140
74,679
69,561
11.3%
5,146
7,579
5,404
-32.1%
7.3%
12.2%
104.7%
102.4%
99.0%
+2.3%
USD
4,882
4,856
3,185
0.5%
2,370
1,950
1,934
21.5%
357
344
348
3.8%
7.3%
8.6%
88.1%
82.9%
86.0%
+5.2%
USD
8,075
7,609
7,451
6.1%
5,271
5,378
5,257
-2.0%
996
978
1,199
1.9%
12.7%
13.0%
87.0%
83.4%
82.8%
+3.6%
Fairfax
USD
9,820
10,287
9,526
-4.5%
8,088
7,521
6,302
7.6%
-513
568
1,633
-190.3%
-5.1%
5.7%
92.5%
89.9%
90.8%
+2.6%
General Reinsurance**
USD
10,661
11,051
11,707
-3.5%
550
548
593
0.3%
742
571
538
30.0%
6.8%
5.0%
92.5%
95.5%
86.5%
-2.9%
392,826
419,405
163,748
138,570
28,485
26,938
-
7.0%
-
107.4%
109.0%
Beazley
CCR, France
China Re
Endurance
Ev erest Re
(6)
GIC India
Hannov er Re
(1)(2)(7)
INR
(1)
EUR
8,997
8,068
7,551
11.5%
14,604
14,850
12,581
-1.7%
1,171
1,151
986
1.8%
13.7%
14.7%
93.7%
94.4%
94.7%
-0.7%
GBP
1,818
1,528
1,453
19.0%
1,788
1,572
1,343
13.7%
337
210
216
60.5%
20.1%
14.1%
84.4%
85.0%
83.9%
-0.6%
Hiscox
IRB, Brazil
(3)(8)
BRL
3,328
3,175
2,954
4.8%
3,543
2,457
1,946
44.2%
850
764
602
11.3%
26.1%
24.9%
82.0%
83.8%
88.8%
-1.8%
Korean Re
(1)
KRWbn
2,115
2,015
1,839
4.9%
4,676
4,369
3,929
7.0%
163
186
116
-12.3%
7.9%
9.7%
98.8%
97.3%
99.4%
+1.5%
USD
1,207
1,220
1,357
-1.1%
459
482
743
-4.8%
154
181
229
-15.1%
12.7%
14.1%
76.5%
72.1%
68.7%
+4.4%
EUR
9,127
8,574
9,153
6.4%
19,038
17,988
18,458
5.8%
776
709
845
9.4%
8.8%
8.0%
97.4%
98.6%
95.7%
-1.2%
USD
8,461
7,834
7,595
8.0%
4,001
3,819
3,917
4.8%
456
583
321
-21.8%
5.6%
7.6%
92.0%
89.0%
95.0%
+3.0%
Lancashire
Mapfre
(3)
Markel
Munich Re
EUR
31,516
30,668
30,033
2.8%
47,325
48,505
47,225
-2.4%
2,580
3,107
3,153
-17.0%
8.3%
10.2%
95.7%
89.7%
94.5%
+6.0%
National Indemnity **
(1)(9)
USD
101,286
89,829
93,998
12.8%
20,030
18,457
26,655
8.5%
7,577
7,271
12,007
4.2%
7.9%
7.9%
95.2%
93.2%
92.5%
+2.0%
Nav igators
USD
1,178
1,096
1,027
7.5%
1,186
1,044
1,000
13.6%
83
81
95
2.1%
7.3%
7.6%
96.7%
94.1%
92.6%
+2.6%
Nov ae
GBP
322
350
336
-8.2%
664
638
528
4.1%
22
52
50
-58.1%
6.4%
15.0%
103.6%
90.8%
91.0%
+12.8%
USD
6,688
6,901
7,049
-3.1%
4,954
5,230
5,720
-5.3%
447
104
1,055
328.5%
6.6%
1.5%
93.6%
85.6%
86.2%
+8.0%
USD
4,867
4,732
3,866
2.8%
1,535
1,416
1,068
8.4%
503
431
533
16.6%
10.5%
10.0%
72.5%
64.7%
50.2%
+7.8%
(1)(3)
USD
7,093
6,135
7,023
15.6%
9,249
8,571
8,670
7.9%
701
502
684
39.7%
10.6%
7.6%
(1)
EUR
6,661
6,330
5,694
5.2%
12,577
12,077
10,138
4.1%
603
642
512
-6.1%
9.3%
10.7%
93.1%
91.1%
91.4%
+2.0%
USD
2,208
2,183
2,019
1.2%
938
848
883
10.7%
88
326
324
-73.0%
4.0%
15.5%
95.1%
81.5%
76.6%
+13.6%
35,634
33,517
35,930
6.3%
33,570
30,442
31,640
10.3%
3,558
4,597
3,500
-22.6%
10.3%
13.2%
93.5%
87.4%
85.4%
+6.1%
181
199
224
209
6
6
-
3.0%
-
96.5%
94.0%
Partner Re
(1)
Renaissance Re
RGA Re
SCOR
Sirius
Sw iss Re
(1)(10)
USD
Toa Re
(1)(2)
JPYbn
Validus
USD
3,838
3,639
3,588
5.5%
2,359
2,229
2,054
5.8%
359
375
481
-4.1%
9.6%
10.4%
84.2%
79.7%
73.7%
+4.5%
WR Berkley
USD
5,047
4,600
4,590
9.7%
6,424
6,190
5,997
3.8%
602
504
649
19.5%
12.5%
11.0%
94.3%
93.7%
93.8%
+0.6%
XL Catlin
USD
10,939
11,677
10,034
-6.3%
10,231
7,951
5,945
28.7%
441
1,207
188
-63.5%
3.9%
11.1%
94.2%
92.0%
88.2%
+2.2%
USD
331,661
332,210
341,480
-0.2%
253,838
264,749
279,179
-4.1%
26,224
31,028
37,796
-15.5%
8.2%
9.5%
94.2%
91.4%
91.5%
+2.8%
Aggregate***
*
Full year Net Income as % of Average Shareholders Equity.
**
General Reinsurance and National Indemnity: Numbers are sourced from unconsolidated financial statements.
***
Aggregate = Total of numbers reported, converted to USD at exchange rates prevailing at end of reporting period.
(1)
NWP includes both Life and Non-Life business.
(2)
GIC India, Toa Re: Each has a March 31 financial year end. Data for the year ended March 31, 2016 is included in the
column headed Dec 31, 2015 (and similar for prior years).
(3)
Figures for net premiums are Net Earned Premium, not Net Written Premiums.
(4)
CCR: Figures for net premiums are Gross Written Premiums, not Net Written Premiums, and include both State-backed
and Open Market business
(5)
Annual information for 2016 not released at time of publication
(6)
Everest Re 2015 Combined ratio as originally reported (subsequently restated to 85.1%)
(7)
GIC India: Shareholders Equity as reported by GIC, parent company.
(8)
Combined ratios are Willis Market Security Calculations.
(9)
Munich Re: Combined Ratios are in respect of the P&C Reinsurance division only. Shareholders' Equity at Dec 31, 2014
are as originally reported.
(10) Swiss Re: Combined Ratios are in respect of the P&C Reinsurance division only.
The information compiled in this report by Willis Towers Watson is compiled from third party sources we
consider to be reliable
However we do not guarantee and are not responsible for its accuracy or completeness and no warranty
or representation of accuracy or completeness is given
18
April 2017
Reinsurance Market Report – Year-End 2016
2. Investment leverage: cash & invested assets / shareholders’ equity
10.0x
(8.7)%
(7.9)%
(7.3)%
(5.4)%
(4.8)%
(4.0)%
-15%
3b. Share price development – Jan 1, 2016 to Dec 31, 2016
+2.4%
+9.5%
0%
1.3x
1.4x
1.5x
(0.9)%
-10%
1.6x
1.7x
1.7x
+0.6%
+0.9%
+1.5%
+2.4%
+2.5%
-5%
1.7x
1.7x
2.0x
1.8x
2.0x
2.2x
2.2x
2.3x
2.3x
2.4x
2.4x
+10.5%
(4.9)%
(4.9)%
(3.5)%
(3.4)%
(3.3)%
(1.7)%
(1.3)%
(0.8)%
(22.9)%
(19.4)%
-30%
+2.6%
-20%
2.4x
+13.9%
+14.4%
+16.1%
+18.2%
+18.8%
+20.3%
+21.1%
+21.5%
+23.4%
+23.7%
+25.4%
+27.2%
-10%
+2.7%
+3.2%
+3.4%
+37.3%
10%
2.5x
2.5x
2.5x
+5.4%
+5.5%
+6.0%
+6.1%
+6.6%
+7.0%
+9.1%
+9.2%
5%
2.5x
2.6x
2.6x
2.7x
3.0x
2.7x
3.2x
3.2x
3.5x
4.0x
3.7x
3.9x
+9.7%
+10.0%
10%
4.2x
5.0x
4.5x
6.0x
19
April 2017
5.1x
20%
+42.2%
30%
6.0x
+44.4%
40%
+10.0%
+10.9%
50%
6.5x
15%
7.1x
7.0x
FY 2015
8.0x
FY 2016
9.0x
1.0x
0.0x
3a. Share price development - YTD 2016 - Jan 1, 2017 to April 4, 2017
0%
Contact us
Annie Roberts
Corporate Communications UK
51 Lime Street
London, EC3M 7DQ
D +44 (0) 203 124 7080
M +44 (0) 778 766 9001
[email protected]
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