Tokio Marine Holdings (8766) Investor update summary

Business performance and growth drivers

• EPS growth remains robust, with a five-year CAGR of 19.9% and current performance at 8.9%, among the best globally, maintaining momentum into FY2025.

• North America is the primary profit driver, contributing about 90% of international business unit profit, with strong underwriting and investment performance.

• Japan P&C business is progressing steadily, leveraging industry reforms and rate increases, with significant effects expected in FY2026.

• Recent bolt-on M&A deals, including Ignyte Insurance's collector vehicle business and Agrihedge, and a raised share buyback program to JPY 240 billion support EPS growth.

• ROE is targeted to reach around 13% post-IFRS adoption, with ongoing efforts to enhance it further.

Strategic initiatives and portfolio evolution

• Focus on expanding the Solutions business as a new pillar, leveraging acquisitions like ID&E and Agrihedge, and collaborative disaster prevention initiatives.

• Continued disciplined M&A strategy, with increased deal opportunities due to market softening and strict acquisition discipline focused on synergy and value creation.

• Diversification of international profit sources, aiming to reduce reliance on North America and build new pillars in other regions, including robust growth in Brazil.

• Ongoing transformation of Japan P&C business, including structural reforms in distribution, expense ratio reduction, and portfolio optimization.

• Enhanced use of AI and data across business lines to improve efficiency and customer experience.

Capital management and shareholder returns

• Sustained DPS growth aligned with profit growth, with FY2025 DPS projected at JPY211 (+23% YoY) and no change in policy after IFRS adoption.

• Share buyback for FY2025 increased to JPY 240 billion, reflecting strong capital position and growth investments.

• Flexible capital policy, with regular reviews every six months to balance investment, EPS growth, and shareholder returns.

• Maintains a strong capital position with ESR at 155% (297% under new definition), providing ample capacity for investment and shareholder returns.

• ROE targets to be refreshed under IFRS in the next midterm plan, with a focus on efficient capital management.