EuroBusiness Media (EBM): Groupama, one of Europe’s largest mutual insurance groups, reports 2010 results. Jean Azéma, welcome. You are the CEO of Groupama. First, what were the highlights of 2010 for Groupama and what are your comments on the Group’s results?
Jean Azéma (JA): For a start, 2010 was a difficult year for all insurers and for insurance as a whole. A difficult year because of the economic context and its effect on the financial markets, whose performance was fairly unfavourable. But also a difficult year in technical terms, not only because of a deteriorating car insurance market for all insurers in France, but also because of the many weather-related claims: the Xynthia storm early in the year, flooding in the Var department and later on several heavy snowfalls, causing a great deal of damage and disrupting transport. Despite this context, the Group’s results were satisfactory since our net income was €387 million with a return on equity of 9.7%, which is admittedly down but entirely reasonable in the context I have just described. And we enjoyed continued growth both in France and internationally, with the Group’s revenues up 2.4% to €17.63 billion.
EBM: What is your position on the French market?
JA: The Group currently generates revenues of €13 billion in France, with excellent growth in car insurance, gaining more than 120,000 insured vehicles last year. We are also seeing significant growth in healthcare, where we are one of the leaders, with more than 48,000 new policies in 2010, and we are of course the leading player in the agricultural market. So growth has been excellent. The bank has also grown, and we now have in excess of 500,000 customers at Groupama Banque.
EBM: Internationally, you are present in markets that have suffered the full brunt of the crisis. How are your subsidiaries performing?
JA: We run operations in southern and central Europe, in many countries that have been hit hard by the crisis: Greece, Portugal and Spain along with Romania and Hungary in central Europe. However, international growth remains extremely buoyant, up 5% in all our ventures. Performance was outstanding in Italy, where we had growth in excess of 7% in 2010, with revenues of €1.5 billion and steady growth in property and liability insurance. But we also saw strong growth of 3.3% in Spain and more than 7% in Turkey. In central Europe – mainly Romania and Hungary, but also Bulgaria and Slovakia – revenues were level with 2009, which is in itself an excellent performance in these – mostly – declining markets.
EBM: How is your multi-channel distribution strategy performing, and in particular are online sales in line with expectations?
JA: Absolutely. Amaguiz continues to enjoy excellent growth. We already have over 100,000 car and comprehensive home insurance policies on Amaguiz. And we will be launching online healthcare insurance in 2011. We have also launched the Groupama.fr website, which enables car owners to take out car insurance policies directly on the Internet, but this time using the Groupama brand. We have also analysed our experiment with the Amaguiz and ClickSeguros websites in Spain - both direct insurance model -, in order to design the model to be deployed in other countries, and we are considering where to establish or develop new direct insurance subsidiaries in other European countries.
EBM: Finally, what is your outlook for 2011?
JA: The economic context remains relatively uncertain, with relatively low growth of 1.5% expected in Europe. We nevertheless intend to pursue our growth strategy, both in France and internationally with our own networks. We will also focus on improving the Group’s operating performance and technical control, which means better selection and better surveillance of our risks, a reduction in our weather-related risks with strengthened reinsurance programmes, a number of cost-cutting programmes, rationalising our IT systems, deriving benefits from the merger of the life companies completed in 2010 and continuing to improve management processes in all the Group’s companies. Thus the prospects are for continued growth and improved earnings in 2011.
EBM: Jean Azéma, CEO of Groupama, thank you.
JA: Thank you.
