Grupo de Inversiones Suramericana SA (FRA:GIM0)

Q2 2026 Grupo de Inversiones Suramericana SA Earnings Call Transcript

Aug 14, 2026 / 01:30 PM GMT

Transcript

Key Points

Positve

Grupo de Inversiones Suramericana SA (BOG:GRUPOSURA) reported a 38% increase in controlling net income to 1.7 trillion pesos, with adjusted ROE reaching a record 16.5%, above the cost of capital.
The company raised its 2026 earnings guidance to 2.5-2.7 trillion pesos, implying EPS of 7,600-8,200 pesos and an adjusted ROE of 15-16%.
Strong performance across portfolio companies: Suramericana's net income grew 30% (ROE 14.2%), Sura Asset Management's net income rose 33% (ROE 12.7%), and Grupo Sivest's net income surged 90% (ROE 20%).
Significant deleveraging progress: expected to receive ~3 trillion pesos in dividends in 2026, using half to reduce net debt by 1.5 trillion pesos, bringing net debt to 5.7 trillion pesos (from 7.1 trillion) and improving net debt-to-dividends ratio to 1.9x.
Capital optimization initiatives include a special dividend from Sura Asset Management (750 billion pesos) and extraordinary dividends from Grupo Sivest's Banismo sale, plus renegotiated debt with ~90 bps cost reduction, saving ~200 billion pesos annually.
Sura Investments segment showed strong operating leverage, with operating margin expanding to 26% (from 10% in H1 2025) and net income tripling, driven by double-digit AUM growth and cost discipline.
Life insurance segment performed well, with premiums up 14% and underwriting results up 94%, driven by lower loss ratios and strong investment income.
The company highlighted a significant valuation gap, trading at ~6x earnings (preferred at <5x) versus peers at >10x, implying substantial upside potential.
Management is committed to doubling dividends by 2028 (from 1,500 to 3,000 pesos per share) and continues to explore buybacks and capital allocation to close the valuation gap.

Negative

Property and casualty (P&C) segment faced challenges: premiums declined 2% nominally (only 2% growth in constant currency) due to competitive market conditions, and combined ratio deteriorated to 105.6% (from 105%), with net income falling to 58 billion pesos from 89 billion pesos.
Investment income in P&C segment declined 7% due to a smaller investment base and sensitivity to USD movements, and overall investment returns are expected to normalize in H2 2026, potentially reducing earnings.
The company absorbed a one-time wealth tax impact of 227 billion pesos in Q1 2026, which reduced controlling net income and affected all subsidiaries (Suramericana: 84 billion, Sura AM: 94 billion).
Regulatory changes in Colombia (decree 1,885) affecting pension insurance premiums and minimum wage increases could impact future earnings, with potential retroactive application risks.
Sura Asset Management's savings and retirement segment saw operating margin decline to 40% (from 42.7%) due to lower fees on inflows from regulatory changes, and legal reserve returns are expected to moderate from the exceptional 14.9% annualized yield.
The company faces uncertainty from the recent earthquake in Colombia, which could lead to higher claims and financial impacts, though reinsurance is in place.
Management noted that the strong H1 investment performance is not sustainable, and they expect a normalization in investment income, which could pressure H2 results.
The P&C segment's combined ratio remains above 100%, and management expects only gradual improvement, with a target of below 100% by 2028.
The company's valuation gap persists, with the market assigning a low value to Suramericana and Sura Asset Management (implied at ~2x earnings), indicating a lack of investor confidence.
Potential changes in the pension reform in Colombia and Chile could affect the business, though management is actively engaging with regulators.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

GRUPOSURA.CN - Grupo de Inversiones Suramericana S.A.
Q2 2026 Grupo de Inversiones Suramericana SA Earnings Call
Aug 14, 2026 / 01:30PM GMT

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Presentation
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This document may contain future disclosures related to Grupo Suranes' subsidiaries, which have been made based on management assumptions and estimates and which may vary.

Good morning, everyone, and thank you for joining Grupo Sura's earnings call. Today's presentation will be divided into two sections: first, a pre-recorded segment where we'll discuss the company's quarterly results and second, a live session where we will answer your questions. Joining us today from Grupo Sura are Ricardo Jaramillo, President, Juanese Vanturo, the Vice President of Corporate Finance, Maria de Laidar Strepo, who is the Vice President of Corporate Legal Affairs, and Carlos Gonzalez, who is the

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