W&W Group records strong first quarter in 2019
- Consolidated net profits up by over a third year on year, to EUR 78.5 million after three months.
- Growth in new business in the first quarter.
- Favourable claims development in property/casualty insurance.
- Consolidated net profits expected to be in the upper corridor range in the year as a whole.
- Executive Board Chairman Jürgen A. Junker: “Change is constantly gaining momentum in the W&W Group.”
The Wüstenrot & Württembergische Group (W&W) records business growth significantly above its own expectations in the first quarter of 2019. Despite ongoing high levels of investment in the digital transformation and the challenging market environment, consolidated net profits rose by over a third (up 35 percent) from EUR 58.0 million in the first quarter of 2018 to 78.5 EUR million. This was primarily based on growth in investment income, in new business and favourable claims development in the area of property insurance. In view of the good start to the year, the financial planning group expects to achieve results at the upper end of the long-term target corridor between 220 and EUR 250 million.
Jürgen A. Junker, Chairman of the Executive Board of W&W AG: “The W&W Group has made a good start to 2019. The results of the first three months show that our move towards a digital future and the transformation of the status quo is taking place on the basis of a growing and successful operational business. Our transformation continues to gain momentum. In that context our new digital services and products are making an ever greater contribution to new business. Irrespective of ongoing low interest rates, a weakening economy and stiffer competition, our optimism for 2019 has grown still further.”
In the construction financing business (including brokering for third parties) the W&W Group achieved a 13.8 percent increase in the first quarter of 2019, up to EUR 1.46 billion (2018: EUR 1.28 billion). In the home loans sector, Wüstenrot, Germany’s second largest private building society, slightly increased its gross new business with total building society savings of EUR 3.47 billion (2018: EUR 3.46 billion). Net new business remained at the same level as the previous year, at EUR 2.61 billion.
In property/casualty insurance, gross premiums written rose by 5.8 percent to EUR 930.2 million (previous year: EUR 879.6 million). All segments (motor, corporate and private customers) contributed to growth. Once again claims development was very favourable. In life and health insurance, Württembergische Versicherung recorded 7.3 % growth in gross premiums written, up to EUR 590.9 million following EUR 550.9 million in the same quarter of the previous year.
Since May 2018 the W&W Group’s digital business models have been bundled in W&W brandpool GmbH. These are already generating significant business and opening up new customer groups. For example Adam Riese, the digital brand launched in 2017, had already acquired around 50,000 customers by the end of March 2019.
Outlook for the entire year 2019
Following this dynamic start the W&W Group now expects consolidated net profits at the upper end of the range from EUR 220 to 250 million, which it has set as its long-term target corridor. Previously W&W had set the target of surpassing the previous year’s figure of EUR 215 million in the current year.