Company Reports

Scor has delivered EUR 162 million in net income for fourth-quarter 2023 and EUR 812 million over the full year. This is equivalent to EUR 0.91 and EUR 4.54 in EPS. Following these results, the board is proposing to pay a dividend of EUR 1.80 per share, a little lighter than company-compiled consensus of EUR 1.84. This means the dividend is back to prior levels before the cut last year. Scor's shares currently offer a 6.2% yield. The group’s solvency ratio is 209%, within the company’s 185%-220% range. The annual general meeting is being held on May 17 and the proposed dividend ex-date and payment dates are May 21 and 23, respectively. Scor’s results are above our estimates.

In the January round of renewals, Scor has grown its estimated gross premium income by more than double digits. There are moderate price increases in this top-line growth, with nominal price increases of 3.1%. That is below the 3.4% rate of inflation across the European Union in December last year. The price increases will probably be enough to offset the rise in claims costs over the course of this year.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving many clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small and medium-size business reinsurance and led to some reserve summons.

Scor has reported a sound set of earnings for the first 9 months with a net income of EUR 650 million so far and EUR 147 million in the third quarter. That leaves the business already well ahead of our EUR 502 million net income forecast and suggests the business will earn quite a bit above its cost of equity for shareholders. Large losses year to date are below the EUR 950 million full-year budget. Solvency has declined to 206%.

Scor reported net income of EUR 502 million for the first half of 2023, leaving it well ahead of our expectations for the full year. We maintain our EUR 33 fair value estimate and no-moat rating.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving many clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small and medium-size business reinsurance and led to some reserve summons.

We believe balance sheets have been an underappreciated element in insurance and that prior accounting rules and economic conditions have left property and casualty-orientated insurers in unenviable positions. Even before the coronavirus pandemic, as interest rates remained low, traditional reinsurance capital became elevated as the fall in interest rates led to rises in the value of fixed-income assets. Couple this with the rise of alternative capital as pension funds and hedge funds sought to diversify their returns into an asset class with little correlation to financial markets, and reinsurance capital available for deployment increased to new heights. That meant the pressure on pricing increased as the number of claims related to climate change rose.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving many clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small and medium-size business reinsurance and led to some reserve summons.

Scor has reported a strong start to the year with net income of EUR 311 million for the first quarter. We raise our fair value estimate to EUR 33 per share and maintain our no moat rating.

When looking at the exposure of insurers to the unfolding banking crisis, we believe this is limited. The main impact of the crisis currently seems to be contagion, so investors are selling shares cheaply. However, exposure to United States bonds is either in government bond securities, or exposure to Credit Suisse, Silicon Valley Bank, and other U.S. regional banks is immaterial, which is 50 basis points or less of their investment portfolio. Some do hold larger bank debt holdings of up to 5.5% of shareholder investments, but nearly all that debt ranks as senior. AT1 debt tends to be very minimal or there is no exposure as a policy with board-level approval. The vast majority of corporate debt held is investment-grade. We maintain our fair value estimates and moat ratings across our European insurance coverage. Allianz remains our Best Idea. Admiral is one of our top picks.

Scor has closed out what appears to be quite a dismal 2022, reporting a net loss of EUR 301 million versus our net loss estimate of EUR 432 million. The key problem area for the business last year was its growth within the natural catastrophe line of business. Over the full year Scor property and casualty reported a combined ratio of 113.2%. That was versus our estimate of 111.2%. Within Scor’s results, natural catastrophe losses accounted for 12.4 percentage points within that full-year combined ratio. Another 5.9% can be attributed to a strengthening of reserves as a result of their current weakness. This EUR 485 million has been transferred from life and health releases. This is available due to an accounting difference. Overall, results within life and health look excellent. Though some of this will be due to investment earnings, there is also a contribution from in-force management. The technical result and margin are EUR 756 million and 14.5% respectively. That is substantially better than our EUR 506 million and 7.4% respectively. While we think this profitability is unsustainable, management appears to be guiding to better ongoing numbers.

In this year's January renewals Scor has continued to write less natural catastrophe claims and continued with its shift to global lines. Over recent years Scor has reported poor results as a result of its growth in the natural catastrophe business and so, we welcome the double-digit reduction in maximum losses for potential large events. In this year’s renewals the reinsurer reported double-digit growth for global lines and this consists of speciality risks. This mainly concerns engineering and inherent defects insurance. We like this. We maintain our EUR 26.90 fair value estimate and no moat rating.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving many clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small- and medium-size business reinsurance and led to some reserve summons.

Scor has announced the appointment of Thierry Leger as its new CEO. Leger joins from Swiss Re where he was chief underwriting officer. We maintain our EUR 26.90 fair value estimate and no moat rating.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving thousands of clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small- and medium-size business reinsurance and led to some reserve summons.

Scor continues to report disappointing results for the first nine months of this year. The net loss position has come in at EUR 509 million and that is versus the loss of EUR 432 million that we estimate for the full year. We maintain our EUR 26.90 fair value estimate and no moat rating.

Many European insurance companies have fallen into 5-star territory year to date. However, we still like and support our preferred picks of two primary firms. In our personal lines subindustry, we still like Admiral. That is because we believe the business is adept at growing its customer numbers ahead of peers and the market. Though we do anticipate slower motor insurance growth over the immediate time frame, coupled with a fall in home insurance volumes due to lower U.K. completed home sales, we still believe in the prospects for Admiral’s long-term growth. Yet, while the business clearly outstrips the competition in terms of expansion, its development is not aggressive. Admiral has grown its U.K. motor market share by 5 percentage points over the last 10 years.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving thousands of clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small- and medium-size business reinsurance and led to some reserve summons.

Scor reported a disappointing set of financial results for the first half of 2022, but we think the business is orientating to better positioning. We maintain our no-moat rating and have nudged our fair value estimate up to EUR 26.90 per share.

Scor is a large reinsurance company headquartered in Paris. It operates in over 100 countries, serving thousands of clients from offices worldwide. Scor was established in the 1970s and has grown by acquisitions. This started to take place in the late 1990s with the purchase of La Vittoria Riassicurazioni in Italy. Shortly after this, the business merged with Union des Assurances de Paris. Broader problems for the business began with the mid-1990s acquisition of the reinsurance business of Allstate. This purchase doubled Scor's share in the United States. The acquired reinsurance portfolio was one of the largest books of small- and medium-size business reinsurance and led to some reserve summons.