Aviva 2013 Annual Report Download - page 259

Strategic report Governance IFRS Financial statements Other information
Aviva plc
Annual report and accounts 2013
257
Financial and operating performance continued
has been offset by management actions to reduce exposure in
unprofitable business segments.
Adjusted general insurance and health operating profit in
2012 decreased by £34 million, or 7%, to £488 million (2011:
£522 million). Our UK general insurance operation has seen a
decrease of £19 million, or 4%, to £459 million (2011: £478
million). Excluding the RAC contribution of £75 million in 2011,
this represented a like for like increase of 14% with the 2012
result benefiting from a favourable movement on prior year
claims and an increase in long term investment return. 2012
was the second wettest year on record and whilst UKGI had
more flood claims, weather-related claims were broadly in line
with long-term average compared to the favourable experience
in 2011. In Ireland, general insurance adjusted operating profit
has decreased by £15 million, or 34%, to £29 million (2011:
£44 million) mainly reflecting the difficult environment with
intense competition and the adverse effect of the economy on
premium volumes.
Profit before tax decreased by £595 million, or 71%, to
£248 million (2011: £843 million). 2011 benefited from the
profit on disposal of RAC of £532 million. This combined with
an increase in restructuring costs accounts for the majority of
the year on year decrease.
France
The table below presents sales, net written premiums, adjusted
operating profit and profit before tax attributable to
shareholders’ profits under IFRS from our operations in France
for the three years ended 31 December 2013, 2012 and 2011.
2013
£m
2012
£m
2011
£m
Sales
Long-term insurance and savings business 4,509 3,638 4,047
General insurance and health net written
premiums 1,105 1,002 1,016
Total sales 5,614 4,640 5,063
IFRS net written premiums 5,565 4,702 5,233
Adjusted operating profit before tax
Long-term insurance and savings business 385 335 323
General insurance and health 84 95 144
Other operations (21) (8) 4
Total adjusted operating profit before tax 448 422 471
Profit before tax attributable to
shareholders' profits 457 482 267
Year ended 31 December 2013
On a PVNBP basis, long-term insurance and savings business
sales in France increased by £871 million, or 24%, to £4,509
million (2012: £3,638 million), with higher sales in both savings
(particularly unit-linked) and protection products. General
insurance and health sales were up 10% to £1,105 million
(2012: £1,002 million), benefiting from rating and other
management actions. IFRS net written premiums were up 18%
to £5,565 million (2012: £4,702 million) for similar reasons.
Adjusted operating profit before tax increased by 6% to
£448 million (2012: £422 million). Within this, life profits
increased by 15% to £385 million (2012: £335 million), mainly
reflecting increased margins. General insurance and health
profits decreased to £84 million (2012: £95 million) with the
reduction largely due to adverse weather, partly offset by higher
profits from the health business.
IFRS profit before tax decreased to £457 million (2012: £482
million). This includes the higher adjusted operating profits
discussed above. The reduction in profits is due mainly to higher
restructuring costs of £25 million (2012: £11 million), and lower
favourable investment variances of £55 million (2012: £96
million favourable).
Year ended 31 December 2012
Total sales in France were down £423 million, or 8%, to £4,640
million (2011: £5,063 million) mainly due to a reduction in long-
term insurance and savings sales. Total life and pensions sales
decreased 10% to £3,638 million (2011: £4,047 million), a
reduction of 4% on a local currency basis, with sales in the
AFER product declining and sales through the Bancassurance
channel remaining broadly flat.
France’s net written premium was £4,702 million, down
£531 million, or 10% (2011: £5,233 million) driven by the
decrease in AFER sales and relatively flat sales in general
insurance.
Adjusted operating profit for long-term insurance and
savings business in 2012 was £335 million (2011: £323 million),
an increase of £12 million or 4%.
General insurance and health adjusted operating profit
decreased by £49 million, or 34%, to £95 million (2011: £144
million) due in part to the one-off release in 2011 of surplus
reserve margins of £45 million. There was also adverse claims
experience from the February 2012 freeze, partly offset by a
decrease in personal motor bodily injury claims.
Restructuring costs in France were down £19 million, or
63%, to £11 million (2011: £30 million). 2011 included higher
costs from the previous European restructuring programme.
Profit before tax attributable to shareholders’ profits was
£482 million, an increase of £215 million, or 81% (2011:
£267 million).
Poland
The table below presents sales, net written premiums,
adjusted operating profit and profit before tax attributable to
shareholders’ profits under IFRS from our operations in Poland
for the three years ended 31 December 2013, 2012 and 2011.
2013
£m
2012
£m
2011
£m
Sales
Long-term insurance and savings business 486 373 487
General insurance and health net written
premiums 69 65 65
Total sales 555 438 552
IFRS net written premiums 475 433 468
Adjusted operating profit before tax
Long-term insurance and savings business 164 153 167
General insurance and health 9 9 (5)
Other operations 11 5 5
Total adjusted operating profit before tax 184 167 167
Profit before tax attributable to
shareholders' profits 178 176 157
Year ended 31 December 2013
Life and pensions sales on a PVNBP basis were up 30% to
£486 million (2012: £373 million), mainly due to increased sales
of unit-linked products and pensions following changes in
pensions legislation. General insurance net written premiums
were £69 million (2012: £65 million). Total net written
premiums increased 10% to £475 million (2012: £433 million)
due mainly to higher life and pensions sales.
Adjusted operating profit has increased by 10% to £184
million (2012: £167 million). Life profits increased by 7% to
£164 million (2012: £153 million) due to lower expenses and
higher assets under management. General insurance profits
were stable at £9 million (2012: £9 million).
Profit before tax attributable to shareholders was £178
million, an increase of 1% (2012: £176 million).
Year ended 31 December 2012
Total long-term insurance and savings in Poland were down by
£114 million, or 23%, to £373 million (2011: £487 million) as a
result of lower appetite for unit-linked products and regulatory
changes relating to pensions.