Topdanmark (TOP) Q2 2024 earnings summary

Executive summary

• H1 2024 profit after tax was DKK 488m, down from DKK 633m in H1 2023, mainly due to DKK 195m after-tax one-off costs from the Nordea IT separation and Sampo transaction.

• Organic insurance revenue growth was 5.0% in H1 2024, with continued pricing effects and stronger net customer inflow.

• Net investment result improved to DKK 244m from DKK 24m in H1 2023.

• Sampo plc made a recommended public tender offer, valuing the company at DKK 33bn, with all regulatory approvals obtained and offer period expected to commence in August.

• Efficiency gains and digitalisation initiatives contributed to improved operational performance.

Financial highlights

• H1 2024 insurance revenue was DKK 5,653m, up from DKK 5,015m in H1 2023; Q2 2024 insurance revenue was DKK 2,857m, up from DKK 2,515m in Q2 2023.

• Combined ratio increased to 85.4% in H1 2024 from 82.9% in H1 2023, mainly due to higher claims in motor and fire-related incidents.

• Net investment result improved significantly to DKK 244m in H1 2024 from DKK 24m in H1 2023.

• Solvency cover stood at 215% at 30 June 2024, up from 193% at year-end 2023.

• Efficiency programme delivered DKK 430m gross savings in 2023, targeting DKK 540m in 2024 and DKK 650m by 2025.

Outlook and guidance

• 2024 profit after tax forecast adjusted to DKK 950–1,175m, reflecting one-off IT separation and Sampo transaction costs.

• Organic insurance revenue growth for 2024 expected around 6%, up from previous guidance above 4.5%.

• Combined ratio for 2024 narrowed to 83–85% including run-off, with expense ratio expected below 17%.

• Transaction costs related to Sampo's offer expected at DKK 90–110m, not tax deductible.

• Operational EPS for 2024 forecasted at DKK 14.6–16.8.