Q1 2025 Vienna Insurance Group Wiener Versicherung Gruppe AG Earnings Call Transcript
Key Points
- Vienna Insurance Group AG (WBO:VIG) reported a solid growth in insurance service revenue by more than 8% and profit growth before taxes of 7.5% for the first quarter of 2025.
- The company successfully issued a Tier 2 bond with a principal amount of EUR300 million, which was three times oversubscribed, indicating strong investor confidence.
- VIG's solvency ratio improved to a robust 271%, up from 262% in the previous year, supported by increased own funds and positive interest rate developments.
- The net P&C combined ratio improved from 92.7% to 92.3%, reflecting a lower claims ratio due to fewer weather-related claims and positive developments in the motor business.
- VIG is actively pursuing growth opportunities, including acquisitions in Albania and a bid for Moldasig in Moldova, as well as a stake in Phinance, Poland's largest financial broker.
- Despite a strong start to the year, VIG maintained its full-year guidance unchanged, suggesting caution due to potential uncertainties or slowdowns later in the year.
- The company's sensitivity to changes in corporate bond spreads has increased, with a 50 basis point increase now resulting in a minus 6% impact, compared to minus 15% last year.
- VIG faces challenges in managing inflation and pricing trends, particularly in Austria where long-term contracts are indexed to specific indices rather than CPI.
- The cost ratio increased year-over-year, which could impact profitability if not managed effectively.
- There is potential exposure to interest rate fluctuations, although the company has managed well in past crises, the optimal level of interest rates for VIG's business remains uncertain.
Ladies and gentlemen, welcome to VIG key figures and updates first-quarter 2025 conference call and live webcast. I am Yusuf, the Chorus Call operator. (Operator Instructions) and that this conference is being recorded.
The presentation will be followed by a Q&A session. (Operator Instructions) At this time, it is my pleasure to hand over to Peter Hoefinger, Deputy CEO of VIG. Please go ahead.
Thank you very much and very warm welcome this afternoon. I'm happy to present together with my colleague, Liane Hirner, our first quarter results.
We can present quite solid results in the first quarter with a growth in insurance service revenue by more than 8% and profit growth before taxes of 7.5%. We also have been able to successfully adhere to Sustainability Bonds and repurchasing part of our subordinated debt.
Additionally, we have we have additions in Albania to our two non-life insurance company, a
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