Porto Seguro disclosures its 3Q10 Results

Transcription

3Q10 and 9M10 Earnings Release
Investor Relations Contact
Investor Relations:
(+55 11) 3366-5323
(+55 11) 3366-5378
www.portoseguro.com.br
[email protected]
Media
RAF Comunicação
(+ 55 11) 5573-8916
www.raf.com.br
[email protected]
3Q10 and 9M10 Highlights
3Q10 and 9M10 Earnings Conference Call
Date: Friday, November 05, 2010
Net Earnings of R$ 203.1 million in 3Q10. Excluding the
nonrecurring effects, Net Earnings was R$190.0 million.
> Portuguese
11:00 a.m. (Brasília time) / 09:00 a.m. (New York time)
Tel: (+55 11) 3301-3000 Code: Porto Seguro
Replay: (+55 11) 3127-4999 Code: 48093503
Total written premiums increase 45.9% in 3Q10 and
44.8% in 9M10. Eliminating the nonrecurring effects, the
increase was 11.8% in 3Q10 and 11.9 in 9M10.
http://webcast.mz-ir.com/publico.aspx?codplataforma=2321
> English
11:30 p.m. (New York time) / 13:30 p.m. (Brasília time)
Tel: +1 (973) 935-8893 and Code: 20253331
Replay: +1 (706) 645-9291 and Code: 20253331
http://webcast.mz-ir.com/publico.aspx?codplataforma=2322
Public Meeting
Date: Monday, November 08, 2010 at 6:00 p.m. (Brasília time)
Local: Hotel Clarion
Rua Bernardo Guimarães, 2032, Lourdes
Belo Horizonte – MG
OBR
Return on financial investments corresponds to 119.0%
of the CDI (interbank deposit rate) in 3Q10 and 117.0%
of the CDI in 9M10.
Total loss ratio of 56.2% in 3Q10, down 2.2 p.p. from
3Q09 and 57.4% in 9M10, down 1.3 p.p. from 9M09.
Combined ratio of 94.4% in 3Q10 and 95.6% in 9M10.
Excluding ISa+r, Combined Ratio was 95.5 in 3Q10 and
96.9 in 9M010.
ROAE of 23.3% in 3Q10, 9.6 p.p. higher than 3Q09.
Eliminating the nonrecurring effects, the ROAE was
21.8% in 3Q10 and 18.2% in 9M10.
ABOUT PORTO SEGURO
Porto Seguro is one of Brazil’s leading insurance companies. Since 1945 it has offered through its subsidiaries a broad range of insurance
products, which include automotive, health, business, life and pension plans, property and transportation. It is the leader in auto insurance
and homeowner also ranks third nationwide in corporate health plans, with these segments representing its main key product lines.
1
Message from the Management
In this quarter, we achieved a better performance in our operational and financing
indicators. We had reduction in total loss ratio, in the G&A and commission, and also
an increase in the financial result.
The combined ratio was 94.4% in 3Q10, down 4.8 p.p. from 3Q09, and the amplified
combined ratio reached 85.7%, down 5.6% p.p. from 3Q09.
The written premiums in 3Q10 increased 45.9% from 3Q09, excluding ISa+r, the
increase was 11.8%. The consolidated net earnings reached R$ 203.1 million in the
quarter, 177.1% higher from 3Q09, with a ROAE of 23.3%. Eliminating the
nonrecurring effects, net earnings was R$190,0 million in 3Q10, with a ROAE of
21.8%.
Written Premiuns (R$ million)
Porto Seguro with ISa+r
44.8%
45.9%
1.411,3
5.714,1
3Q10
9M09
9M10
1.411,3
1.577,4
3Q09
3Q10
Net Income (R$ million)
124.4%
4.414,1
3.946,2
11.9%
11.8%
3.946,2
2.059,3
3Q09
Written Premiuns (R$ million)
Porto Seguro without ISa+r
9M09
Net Income (R$ million)
470.3
52.6%
177.1%
203.1
89.8%
209.6
9M10
319.9
209.6
139.1
73.3
73.3
3Q09
3Q10
9M09
9M10
3Q10
3Q10
9M09
9M10
* The 177.1% increase in net earnings in 3Q10 in relation to 3Q09 is mainly due to: (i) the recording of results from ISa+r; (ii) the growth of 45.9% in
written premiums; iii) the 2.2 p.p. reduction in the loss ratio; iv) the 1.7 p.p. decrease in total G&A; v) the 0.9 p.p. reduction in commission expenses;
vi) and due to nonrecurring effect of 13.1 million related to the reversal of provision for loss of tax losses on the basis of technical study on the
expectation of tax credit realization.
2
ROAE % - anualized
ROAE % - anualized
9.6 p.p.
23.3
13.7
3Q09
9.5 p.p.
23.2
5.0 p.p.
18.5
5.2 p.p
18.7
13.7
9M10
3Q09
13.5
13.5
3Q10
9M09
3Q10
9M09
9M10
Written Premiums Breakdown (%)*
3Q09
3Q10 without ISa+r
3Q10 with ISa+r
3,9
4,5
10,6
3,0 6,2
2,5
6,0
7,6
4,2
8,0
5,0
5,4
11,6
9,0
11,8
63,7
68,0
Auto
Health
Life
P&C
66,9
DPVAT
Other
3
Operating and Financial Highlights
3Q10 vs. 3Q09 – 9M10 vs. 9M09
Consolidated
Revenues (in R$ thousand)
Written Premiums
Porto Seguro – Auto
Azul Seguros – Auto
Isar - Auto
Total Auto
Health
Life
P&C
P&C - Isa+r
Total P&C
DPVAT
Other
Porto Seguro Del Uruguay
Written Premiums VGBL
Total Written Premiums
Pension Plan Contribution
Surveillance Services
Consortium
Credit Operations
Other
Net Financial Results
Total Revenue
Additional Information (in R$ thousand)
Total Earned Premiums
Financial Results – Insurance
Ratios (%)
Loss Ratio
ISar - Auto
Total Auto
Health
Life
P&C - Porto
P&C - Isar
Total P&C
Total Loss Ratio
Commission Ratio – Insurance
G&A Ratio – Insurance
Tax Expenses - Insurance
G&A and Tax Expenses Ratio – Insurance
Combined Ratio
Amplified Combined Ratio
3Q10
760.7
243.7
396.4
1,400.8
186.1
85.7
94.4
62.9
157.3
62.4
120.3
17.5
29.2
2,059.3
37.7
15.3
34.4
42.9
24.0
204.7
2,418.3
3Q10
1,851.9
186.6
3Q10
3Q09
743.8
200.5
944.3
163.5
70.4
63.6
63.6
55.5
77.8
12.3
23.9
1,411.3
31.0
16.2
29.7
38.8
9.2
114.2
1,650.4
3Q09
1,244.7
108.3
3Q09
51.3
67.3
65.1
57.6
72.9
37.3
41.9
25.1
34.0
56.2
20.4
15.7
2.1
17.8
94.4
85.7
53.7
69.3
56.7
79.2
35.0
41.7
41.7
58.4
21.3
17.0
2.5
19.5
99.2
91.3
Shareholder's Equity (R$ million) Var. %
Net Earnings (R$ million) Var.%
ROAE %
EPS in R$ Var. %
3,596.1
203.1
23.3
0.62
2,173.2
73.3
13.7
0.32
# of thousand shares
327,642
229,349
Var.%
9M10
2.3
21.5
48.3
13.8
21.7
48.4
147.3
12.4
54.6
42.3
22.2
45.9
21.6
(5.6)
15.8
10.6
160.9
79.2
46.5
Var.%
9M09
2,205.7
660.4
1,047.6
3,913.7
520.3
231.2
244.2
197.4
441.6
218.2
258.9
48.7
81.5
5,714.1
100.1
42.7
98.1
125.2
60.6
537.7
6,678.5
9M10
48.8
72.3
Var.% / p.p
(2.4)
(2.0)
0.9
(6.3)
2.3
0.2
(7.7)
(2.2)
(0.9)
(1.3)
(0.4)
(1.7)
(4.8)
(5.6)
65.5
177.1
9.6
93.8
2,031.0
522.6
2,553.6
500.7
212.3
196.9
196.9
167.5
209.3
39.2
66.7
3,946.2
91.1
45.6
84.3
100.3
23.7
400.5
4,691.7
9M09
5,426.1
493.6
9M10
3,644.7
376.0
9M09
Var%
8.6
26.4
53.3
3.9
8.9
24.0
124.3
30.3
23.7
24.2
22.2
44.8
9.9
(6.4)
16.4
24.8
155.7
34.3
42.3
Var%
48.9
31.3
Var. % / p.p.
53.1
68.9
66.1
59.1
70.5
33.4
43.5
27.2
35.5
57.4
20.1
15.8
2.3
18.1
95.6
87.6
52.6
72.8
56.4
77.6
35.0
46.3
46.3
58.7
21.7
17.2
2.5
19.7
100.1
90.7
0.5
(3.9)
2.7
(7.1)
(1.6)
(2.8)
(10.8)
(1.3)
(1.6)
(1.4)
(0.2)
(1.6)
(4.5)
(3.1)
3,596.1
470.3
18.7
1.44
2,173.2
209.6
13.5
0.91
65.5
124.4
5.2
58.2
327,642
229,349
4
3Q10 vs. 3Q09 – 9M10 vs 9M09
Excluding ISa+r
Revenues (in R$ thousand)
Written Premiums
Total Auto
Health
Life
P&C
DPVAT
Other
Porto Seguro Del Uruguay
Written Premiums VGBL
Total Written Premiums
Pension Plan Contribution
Consortium
Credit Operations
Other
Net Financial Results
Total Revenue
Additional Information (in R$ thousand)
Total Earned Premiums
Financial Results – Insurance
Ratios (%)
3Q10
3Q09
760.7
243.7
1,004.4
186.1
85.7
94.4
39.8
120.3
17.5
29.2
1,577.4
37.7
15.3
34.4
42.9
24.0
136.5
1,868.2
3Q10
Var.%
743.8
200.5
944.3
163.5
70.4
63.6
55.5
77.8
12.3
23.9
1,411.3
31.0
16.2
29.7
38.8
9.2
114.2
1,650.4
3Q09
1,414.1
118.5
3Q10
2.3
21.5
6.4
13.8
21.7
48.4
(28.3)
54.6
42.3
22.2
11.8
21.6
(5.6)
15.8
10.6
160.9
19.5
13.2
Var.%
1,244.7
108.3
3Q09
51.3
67.3
54.8
72.9
37.3
41.9
54.9
20.8
17.7
2.1
19.8
95.5
88.1
53.7
69.3
56.7
79.2
35.0
41.7
58.4
21.3
17.0
2.5
19.5
99.2
91.3
Shareholder's Equity (R$ million) Var. %
Net Earnings (R$ million) Var. %
ROAE %
EPS in R$ Var. %
2,469.3
139.1
23.2
0.61
2,173.2
73.3
13.7
0.32
# of million shares
229,349
229,349
2,205.7
660.4
2,866.1
520.3
231.2
244.2
163.2
258.9
48.7
81.5
4,414.1
100.1
42.7
98.1
125.2
60.5
370.3
5,211.0
9M010
13.6
9.4
Var.% / p.p.
Loss Ratio
Total Auto
Health
Life
P&C - Porto
Total Loss Ratio
Commission Ratio – Insurance
G&A Ratio – Insurance
Tax Expenses - Insurance
G&A and Tax Expenses Ratio– Insurance
Combined Ratio
Amplified Combined Ratio
9M010
(2.4)
(2.0)
(1.9)
(6.3)
2.3
0.2
(3.5)
(0.5)
0.7
(0.4)
0.3
(3.7)
(3.2)
13.6
89.8
9.5
90.6
4,128.9
326.2
9M010
9M09
2,031.0
522.6
2,553.6
500.7
212.3
196.9
167.5
209.3
39.2
66.7
3,946.2
91.1
45.6
84.3
100.3
23.7
400.5
4,691.7
9M09
3,644.7
376.0
9M09
53.1
68.9
56.4
70.5
33.4
43.5
56.3
20.5
17.5
2.6
20.1
96.9
89.7
52.6
72.8
56.4
77.6
35.0
46.3
58.7
21.7
17.2
2.5
19.7
100.1
90.7
2,469.3
319.9
18.5
1.39
2,173.2
209.6
13.5
0.91
229,349
229,349
Var.%
8.6
26.4
12.2
3.9
8.9
24.0
(2.6)
23.7
24.2
22.2
11.9
9.9
(6.4)
16.4
24.8
155.3
(7.5)
11.1
Var.%
13.3
(13.2)
Var.% / p.p.
0.5
(3.9)
(7.1)
(1.6)
(2.8)
(2.4)
(1.2)
0.3
0.1
0.4
(3.2)
(1.0)
13.6
52.6
5.0
53.8
5
3Q10 vs. 3Q09 – 9M10 vs 9MH09
Results from Insurance Operations (Consolidated)
Result from Insurance Operations
3Q10
1,851.9
(1,040.2)
(159.2)
(48.1)
(330.1)
186.6
R$ million
Earned Premiums
Retained Claims
Variation of Techinical Reserves - Insurance
Reinsurance Premiums
Administrative Expenses and Taxes - Insurance
Financial Result - Insurance
3Q09
1,244.7
(727.4)
(152.5)
(14.1)
(242.7)
108.3
Var. %
48.8
43.0
4.4
241.1
36.0
72.3
9M10
5,426.1
(3,112.4)
(228.6)
(59.3)
(982.8)
493.6
9M09
3,644.7
(2,138.1)
(276.1)
(25.4)
(717.0)
376.0
Var.%
48.9
45.6
(17.2)
133.5
37.1
31.3
Combined
Ratio %
% Combined Ratio
99.2
19.5
97.9
95.1
17.8
19.1
20.1
94.7
94.4
18.7
17.8
19.8
20.0
20.4
20.8
54.9
21.3
20.5
58.4
55.5
60.0
56.0
56.2
3Q09
4Q09*
1Q10
2Q10
3Q10
G&A and Taxes
95.5
Comission
3Q10 (ex
ISa+r)
Loss Ratio
* Including ISa+r, since 4Q09.
6
Auto
Porto Seguro Auto
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Written Premiums (R$ million)
Loss Ratio (%) - Var (p.p.)
Insured Vehicles (thousand)
760.7
51.3
743.8
53.7
2.3
(2.4)
2,205.7
53.1
1,808
2,031.0
52.6
1,704
8.6
0.5
6.1
Azul Seguros Auto
3Q10
3Q09
Var. %
9M10
9M09
Var.%
243.7
67.3
200.5
69.3
21.5
(2.0)
660.4
68.9
730
522.6
72.8
587
26.4
(3.9)
24.4
Itaú Seguros Auto
3Q10
3Q09
Var. %
9M10
9M09
Var.%
396.4
65.1
1047.6
66.1
1,051
Consolidated Auto Insurance
% Loss Ratio
Writtem Premiums
R$ (million)
with ISa+r
56.7
3,913.7
944.3
1,004.4
1,400.8
3Q09
3Q10
without
ISa+r
3Q10 with
ISa+r
59.1
57.6
53.3%
48.3%
2.7p.p.
0.9 p.p.
2,553.6
2,866.1
9M09
9M10
without
ISa+r
9M10 with
ISa+r
56.4
56.4
3Q09
3Q10
without
ISa+r
Insured Fleet (million)
56.7%
54.8
3Q10 with
ISa+r
9M09
9M10 9M10 with
without
ISa+r
ISa+r
2,291
2,538
9M09
9M10
without
ISa+r
3,589.
9M10 with
ISa+r
Written premiums in Porto Seguro auto portfolio totaled R$ 760.7 million in 3Q10, an increase of 2.3% from R$
743.8 million in 3Q09. This increase basically reflects the expansion of 6.1% in the number of insured vehicles,
partially offset by the growth in places where the average premium is lower. The 2.4 p.p. decrease in the loss ratio
at Porto Seguro Auto in 3Q10 in relation to 3Q09 is mainly due to risk acceptance criteria adjustments and
decrease in robbery and theft frequency;
Written premiums in Azul Seguros auto totaled R$ 243.7 million in 3Q10, an increase of 21.5% from R$ 200.5
million in 3Q09. This increase is mainly due to the 24.4% expansion in the number of insured vehicles in the
quarter, partially offset by the growth in places where the average premium is lower. The loss ratio in the quarter
was down 2.0 p.p. from 3Q09, mainly due to acceptance criteria adjustments and decrease in robbery and theft
frequency;
Written premiums in the auto portfolio of ISa+r (Itaú Seguros de Automóvel e Residência) totaled 396.4 million,
with a loss ratio of 65.1%.
7
Health
Health Insurance
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Lives insured (thousand)
186.1
72.9
163.5
79.2
13.8
(6.3)
520.3
70.5
455
500.7
77.6
380
3.9
(7.1)
19.7
Written premiums in health insurance totaled R$ 186.1 million in 3Q10, 13.8% higher than 3Q09,
primarily reflecting the increase of 19.7% in the number of insured lives, partially offset by the
reduction in the age group.
The loss ratio was 72.9% in 3Q10, down 6.3 p.p. from 3Q09, basically explained by the lower use
frequency, the more stable economic situation, and by the elimination of deficit policies.
% Loss Ratio - Health
79.2%
71.4%
72.0%
72.9%
2Q10
3Q10
66.2%
3Q09
4Q09
1Q10
8
Property & Casualty
P&C
Commercial
3Q10
3Q09
Var. %
9M10
9M09
Var.%
55.5
44.1
42.9
41.3
29.4
2.8
146.3
43.0
111.9
45.6
30.7
(2.6)
Building
3Q10
3Q09
Var. %
9M10
9M09
Var.%
4.2
39.9
4.6
51.8
(8.7)
(11.9)
11.4
53.4
12.1
60.8
(5.8)
(7.4)
Porto Homeowner
3Q10
3Q09
Var. %
9M10
9M09
Var.%
20.3
46.4
8.3
51.3
144.6
(4.9)
58.4
50.1
50.2
53.1
16.3
(3.0)
Other
3Q10
3Q09
Var. %
9M10
9M09
Var.%
14.4
15.5
7.8
16.3
84.6
(0.8)
28.1
21.4
22.7
18.8
23.8
2.6
Total Porto P&C
3Q10
3Q09
Var. %
9M10
9M09
Var.%
94.4
41.9
63.6
41.7
48.4
0.2
244.2
43.5
196.9
46.3
24.0
(2.8)
ISa+r Homeowner
3Q10
3Q09
Var. %
9M10
9M09
Var.%
62.9
25.1
-
-
197.4
27.2
-
-
Total P&C with ISa+r
3Q10
3Q09
Var. %
9M10
9M09
Var.%
157.3
34.0
63.6
41.7
147.3
(7.7)
441.6
35.5
196.9
46.3
124.3
(10.8)
Total written premiums in property and casualty was R$ 157.3 million in 3Q10, an increase of 147.3% from R$
63.6 million in 3Q09, mainly reflecting ISa+r (Itaú Seguros de Auto e Residência) portfolio and the increase of
48.4% in Porto Seguro written premiums.
The loss ratio was 34.0% in 3Q10, down 7.7 from 3Q09, mainly due to the ISa+r residences portfolio.
9
Life
Life Insurance
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Lives insured (thousand)
85.7
37.3
70.4
35.0
21.7
2.3
231.2
33.4
3,090
212.3
35.0
2,688
8.9
(1.6)
15.0
Written Premiums totaled R$ 85.7 million in 3Q10, an increase of 21.7% from 3Q09, due to the higher
number of insured lives.
The loss ratio in 3Q10 was 2.3 p.p. higher than in 3Q09, mainly due to the increase frequency of claims
in mass insurance.
Pension Plan and VGBL
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Pension Plan Contribution (R$ million)
Premiums - VGBL (R$ million)
Mathematical Reserves (R$ million)
Total Active Participants (thousands)
37.7
29.2
31.0
23.9
21.6
22.2
100.1
81.5
1,408.1
140
91.1
66.7
1,158.7
131
9.9
22.2
21.5
6.9
Revenue from pension plan contributions totaled R$ 37.7 million in 3Q10, an increase of 21.6% from R$
31.0 million in 3Q09, chiefly due to the higher number of active participants, and an increase in
contributions.
Revenue from VGBL pension plan contributions totaled R$ 29.2 million in 3Q10, an increase of 22.2%
from R$ 23.9 million in 3Q09, basically reflecting the higher number of active participants and the
increase in the contributions.
10
Other Business
Consortium
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Revenues from Consortium operation (R$ million)
Consortium Members (thousand)
34.4
29.7
15.8
98.1
61
84.3
54
16.4
12.2
Revenue from consortium services was R$ 34.4 million in 3Q10, an increase of 15.8% from R$ 29.7
million in 3Q09, driven primarily by the 12.2% increase in the number of clients, which reached 61
thousand in 3Q10.
Surveillance and Monitoring
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Clients (thousand)
15.3
16.2
(5.6)
42.7
22
45.6
17
(6.4)
29.4
Revenue from surveillance services was R$ 15.3 million in 3Q10, down 5.6% from 3Q09, basically
due to the discontinuity of one of the operations, partially offset by the increase of 29.4% in the
number of clients.
Credit Operations (Portoseg)
3Q10
3Q09
Var. %
9M10
9M09
Var.%
42.9
38.8
10.6
125.2
100.3
24.8
Revenue from credit services was R$ 42.9 million in 3Q10, up 10.6% from R$ 38.8 million in 3Q09,
basically explained by the 17.4% growth in credit card operations, partially offset by the 2%
decrease in loans and financing.
11.4%
Credit Operation Portfolio (R$ million)
1,055.1
947.4
17.4%
766.5
652.8
(2.0%)
294.6 288.6
Credit Card
Loans and Financing
3Q09
Total Credit Operation
3Q10
* In this quarter we disclose the total Credit Operation Portfolio, different from the previous where the portfolio showed was expired credit. We
believe that this criterion is better to explain the revenues from the portfolio.
11
Administrative Expenses
3Q10
168,048
57,379
81,214
27,921
6,853
341,415
Payroll
Outsourced Services
Location and Operating
Advertising
Other
3Q09
121,327
34,399
53,198
26,647
9,181
244,752
Var. %
38.5
66.8
52.7
4.8
(25.4)
39.5
9M10
489,533
148,738
219,477
70,555
64,548
992,851
9M09
362,914
93,475
179,582
56,206
25,039
717,216
Var.%
34.9
59.1
22.2
25.5
157.8
38.4
Administrative expenses increased 39.5% in 3Q10 in comparison to 3Q09 due to, mainly the
ISa+r incorporation.
Administrative Expenses Excluding ISa+r
R$ thousand
Payroll
Outsourced Services
Location and Operating
Advertising
Other
3Q10
3Q09
Var. %
9M10
9M09
Var.%
146,405
50,736
70,958
27,388
3,887
299,374
121,327
34,399
53,198
26,647
9,181
244,752
20.7
47.5
33.4
2.8
(57.7)
22.3
424,298
133,899
199,499
69,891
25,758
853,345
362,914
93,475
179,582
56,206
25,039
717,216
16.9
43.2
11.1
24.3
2.9
19.0
Administrative expenses increased 22.3% in 3Q10 in comparison to 3Q09 due to, mainly; (i)
the increase of 20.7% of expenses with payroll as a result of the 5.0% increased under
collective union agreement and the 14.2% expansion in number of employees; (ii) the 47.5%
increase in costs to third parties; (iii) the 33.4% increase in location and operations costs,
mainly due to business expansion.
The G&A and tax was 17.8% in 3Q10, down 1.7 p.p. from 3Q09.
Administrative Expenses (%)
19.5%
19.1%
3Q09
4Q09
17.8%
18.7%
17.8%
1Q10
2Q10
3Q10
19.8%
3Q10
without
ISa+r
12
Other Expenses/ Operating Revenue
Other Operational Expenses/Revenues
R$ thousand
Other Operating Revenues
Other Operating Expenses
Other Oper. Reven./Expenses
3Q10
3Q09
Var. %
9M10
9M09
Var.%
147.4
(113.3)
34.1
71.8
(77.7)
(5.9)
105.3
45.8
-
373.2
(340.3)
32.9
199.7
(249.2)
(49.5)
86.9
36.6
(166.5)
The 105.3% increase in other operational revenues and 45.8% increase in other operational
expenses were due mainly by the ISa+r association.
Other Operational Expenses/Revenues Excluding ISa+r
R$ thousand
3Q10
3Q09
Var. %
9M10
9M09
Var.%
Other Operating Revenues
Other Operating Expenses
105.7
(82.4)
23.3
71.8
(77.7)
(5.9)
47.2
6.0
(494.9)
296.5
(270.6)
25.9
199.7
(249.2)
(49.5)
48.5
8.6
(152.3)
Other Oper. Reven./Expenses
The 47.2% increase in other operational revenues was due mainly by the growth of policy issues and
the administrative fees by credit card;
The 6.0% increase in other operating expenses in the quarter was due mainly by the increase in
costs on gratifications for service providers, inspection of risks and preventive actions.
13
Investment Income
Investment Portfolio
Financial Income / Expenses
Financial Income
R$ thousand
3Q10
3Q09
Var. %
9M10
9M09
Var. %
Investment - Ex-Pension Plan
Investment - Pension Plan
101.1
58.1
70.5
45.5
43.4
27.7
249.0
143.2
261.0
120.5
(4.6)
18.8
Other Revenues
49.1
48.6
1.0
151.2
149.5
1.1
Investment - Isa+r
Other Revenues - Isa+r
Total Financial Income
55.0
18.2
281.5
164.6
71.0
133.4
53.2
730.0
531.0
37.5
R$ thousand
3Q10
3Q09
Var. %
9M10
9M09
Var. %
Pension Plan Operations
ISa+r
Other Expenses
Total Financial Expenses
46.3
5.0
25.7
77.0
34.0
36.3
82.2
34.3
16.5
50.5
55.7
52.5
110.4
19.1
62.8
192.3
48.3
130.5
30.0
Financial Expenses
47.4
Net Financial Income
R$ thousand
3Q10
3Q09
Var. %
9M10
9M09
Var. %
Net Financial Income - Ex-Isa+r
Total Financial Income
136.3
204.5
114.1
114.1
19.4
79.2
370.2
537.7
400.5
400.5
(7.6)
34.3
Net Financial income in 3Q10 was R$ 204.5 million, an increase of R$ 90.4 million (79.2% YoY).
Excluding Isa+r contribution, net financial income amounted to R$ 136.3 million, an increase of R$
22.2 million (19.4% YoY).
For the year, net financial income was R$ 537.7 million, an increase of R$ 137.2 million (34.3%)
over 3Q10, and excluding ISa+r, came to R$ 370.2 million, 7.6% (R$ 30.3 million) drop.
14
Investment Income
Investment Portfolio
The total portfolio (R$ 7.3 billion) produced a financial income of R$ 214 million in 3Q10, representing a yield of
119% of CDI. Excluding pension fund resources and PGBL/VGBL operations, the portfolio (5.8 billion) registered a
return of 111% of CDI.
For the year, income from financial investments was R$ 526 million, representing a yield of 117% of CDI. Excluding
pension fund resources and PGBL/VGBL, the portfolio registered a return of 105% of CDI, with a financial income of
R$ 382 million.
The position held in fixed-income government securities was largely responsible for the increase in yield of 3Q10. It is
worth highlighting that the effective CDI rose by 20% between 3Q10 and 3Q09. The effective CDI fell by 8% YTD.
15
Glossary
Amplified combined ratio: Represents the ratio of total expenses with insurance operations to total revenue plus net financial
income from insurance operations.
Claim: Event whose occurrence gives the policyholder the right to receive indemnification from the insurer.
Commissions: Selling expenses and the portion of insurance premiums paid to brokerages, financial institutions and other insurers.
Combined ratio: Quotient obtained from the sum of insurance-related operating expenses (retained claims, selling expenses, G&A
expenses and taxes) divided by earned premiums. In other words, the ratio of total expenses with insurance operations to total
revenue from insurance operations.
Commission ratio: The quotient obtained from the division of total selling expenses in the insurance operations by total premiums
earned.
Earned premiums: The portion of insurance premiums already expired during the policy's coverage period.
G&A ratio: The quotient obtained from the sum of administrative expenses and taxes in the insurance operations divided by total
premiums earned.
Loss ratio: The quotient obtained from the division of total retained claims by total premiums earned.
P.P.: percentage points.
Premium: The amount paid by a policyholder to the insurer to maintain the policy.
Reinsurance: Operation through which an insurer transfers a portion of a certain risk to a reinsurer.
Reserves: Liability booked by insurers and reinsurers to reflect the estimated cost of payments with indemnifications, benefits and
related expenses.
Retention: The amount or portion of risk that an insurer assumes.
RVNE: Estimated value of the risk premiums for which the policies have not yet been issued.
SUSEP: Brazilian Private Insurance Superintendence.
Underwriting: The process by which an insurer or reinsurer analyzes the proposals presented for insurance or reinsurance coverage
and determines if it will provide a portion or all the coverage solicited for an agreed premium.
VGBL: Free Benefit Generating Plan: product designed for building retirement savings.
Written premiums: The total amount of premiums subscribed in a certain period.
This release contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to the
growth prospects of Porto Seguro. These are merely projections and as such are based exclusively on the expectations of Porto Seguro’s management concerning
the future of the business and its continued access to capital to fund the Company’s business plan. These forward-looking statements depend substantially on
changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry, among other factors
and risks disclosed in Porto Seguro’s filed disclosure documents at the Securities and Exchange Commission of Brazil (CVM) and therefore are subject to change
without prior notice.
16
Balance Sheets
Assets
PORTO SEGURO S.A
BALANCE SHEETS
(Amounts of in thousands of reais)
Consolidated
3Q10
ASSETS
CURRENT LIABILITIES
2Q10
3Q09
10,515,958
9,851,565
6,934,474
Cash and cash equivalents
Marketable securities
Premiums Receivable
Deferred selling expenses
Credit Operations
Securities and amounts receivables
Tax and Contribution
Other receivables
Reinsurance expenses and retrocession
Other assets
NONCURRENT ASSETS
27,857
6,673,385
1,822,966
635,012
157,198
720,624
57,734
293,392
37,500
90,290
2,353,712
30,127
6,297,642
1,676,118
607,243
155,604
669,461
45,632
255,544
6,324
107,870
2,282,108
29,705
4,213,978
1,175,353
431,160
159,511
603,198
37,000
227,512
11,976
45,081
1,794,555
Long-term assets
1,634,632
1,590,411
1,114,561
604,611
519,194
80,442
118,135
296,088
13,536
2,626
19,404
639,834
482,261
32,159
116,315
305,284
12,379
2,179
19,523
263,283
409,923
7,390
117,074
307,479
6,707
2,705
19,100
1,921
8,428
9,055
637,151
1,995
8,428
9,100
617,186
1,404
8,428
9,268
614,718
62,525
54,988
46,176
12,869,670
12,133,673
8,729,029
Marketable securities
Deferred Income Tax and Social Contribution
Credit Operations
Escrow Deposits
Other receivables
Deferred selling expenses
Investments:
Other Investments
IRB - Brasil Resseguros S.A. Investments
Rental Properties
Fixed assets
Intangible asset
TOTAL ASSETS
17
Balance Sheets
Liabilities
PORTO SEGURO S.A.
BALANCE SHEETS
(Amounts of in thousands of reais)
Consolidated
LIABILITIES AND SHAREHOLDERS' EQUITY
3Q10
2Q10
CURRENT LIABILITIES
Accounts payable
Interbank deposits
Exchange acceptances and bond issued
Loans
Accrued vacation and related charges
Interest on own capital and dividends payable
Third-party deposits
Commissions on premiums issued
Other payables - insurance transactions
Technical Provision - Insurance and Pension
IRB - Brasil Resseguros S.A.
NONCURRENT LIABILITIES
Long term liabilities:
Accounts payable
Payables
Deferred Income Tax and Social Contribution
Mathematical Reserve - Insurance and Pension
Legal liabilities
Labor Provisions
Deferred Revenues
DEFERRED INCOME
MINORITY INTEREST
8,034,722
7,544,032
5,467,809
835,296
188,247
86,849
74,736
256,581
18
107,188
313,074
52,796
6,076,486
43,451
1,237,920
734,726
193,080
59,419
42,910
63,510
213,193
510
94,990
273,255
46,389
5,812,155
9,895
1,195,240
584,650
220,297
60,430
40,465
56,519
138,634
504
58,687
234,866
42,898
4,016,031
13,828
1,087,362
9,923
61,263
14,539
1,103,550
24,814
23,831
8,923
47,177
13,330
1,076,368
25,611
23,831
967
872
5,419
42,197
17,420
980,560
17,935
23,831
675
SHAREHOLDERS' EQUITY
Capital
Treasury stock
Capital Reserve
Revaluation Reserves
Securities adjustments
Property valuation adjustments
Profit Reserves
Retained Earnings
TOTAL LIABILITY AND SHAREHOLDERS' EQUITY
3,596,061
3,393,529
2,173,183
1,870,000
47,412
131,913
3,525
(1,032)
1,073,120
471,123
1,870,000
47,412
132,200
4,309
(1,262)
1,073,120
267,750
3Q09
-
12,869,670
-
12,133,673
920,000
47,412
133,300
4,127
(755)
858,410
210,689
8,729,029
18
Income Statement
PORTO SEGURO S.A.
INCOME STATEMENT PERIOD AS OF SEPTEMBER 30, 2010 AND 2009
(Unreviewed amounts of in thousands of reais)
3Q10
Income
Written Premiums
Pension Plan Contributions
Consortium
Revenues from Services - crediporto
Revenues from Services - integração
Revenues from Services - services
Revenues from Services - atendimento
Revenues from Services - other
Credit
Other Revenues
Financial Revenues - Insurance
Financial Revenues - Other
Rent
Expenses
Reinsurance
Technical Reserve Variations-Insurance
Technical Reserve Variations-Pension Plans
Net Retained Claims
Pension Plan Redemptions and Benefits
Cost of services rendered - Monitoring
Cost of services rendered - Integração
Cost of services rendered - Services
Cost of Financial Intermediation
Provision for doubtful accounts - Financial
Commercial Expenses - Insurance
Commercial Expenses - Other Activities
Administrative Expenses - Insurance
Administrative Expenses - Other Activities
Tax on Revenue - Insurance
Tax on Revenue - Other Activities
Other Operational Income(Expenses) - Insurance
Other Operational Income(Expenses) - Other Activities
Financial Expenses - Insurance
Operating Income
2,494,957.0
2,059,350.0
37,719.0
15,232.0
34,433.0
1,740.0
1,024.0
2,408.0
7,050.0
1,638.0
42,834.0
8,634.0
263,313.0
18,005.0
1,577.0
3Q09
1,701,018.0
1,411,284.0
31,011.0
16,189.0
29,759.0
1,585.0
1,151.0
1,007.0
736.0
784.0
38,725.0
2,761.0
158,982.0
5,839.0
1,205.0
(2,134,336.0) (1,583,650.0)
(48,142.0)
(14,101.0)
(159,297.0)
(152,527.0)
(33,524.0)
(30,325.0)
(1,040,277.0)
(727,425.0)
(1,375.0)
(2,585.0)
(7,551.0)
(9,923.0)
(1,010.0)
(890.0)
(61.0)
0.0
(8,204.0)
(6,132.0)
(12,022.0)
(23,558.0)
(376,889.0)
(265,087.0)
(11,900.0)
(11,066.0)
(291,910.0)
(211,943.0)
(49,505.0)
(32,809.0)
(38,177.0)
(30,720.0)
(12,018.0)
(8,110.0)
14,371.0
(16,797.0)
19,823.0
11,006.0
(76,668.0)
(50,658.0)
360,621.0
117,368.0
Var. %
46.7
45.9
21.6
(5.9)
15.7
9.8
(11.0)
139.1
0.0
108.9
10.6
212.7
65.6
208.4
30.9
9M10
6,870,268
5,714,132
100,118
42,701
98,110
6,215
3,094
5,412
16,075
3,526
125,169
22,494
685,385
44,100
3,737
9M09
4,821,944
3,946,173
91,141
45,574
84,320
4,385
3,169
2,720
736
2,331
100,301
7,085
506,259
24,483
3,267
34.8 (6,027,306.0) (4,477,670.0)
241.4
(59,314.0)
(25,385.0)
4.4
(228,689.0)
(276,121.0)
10.5
(98,056.0)
(88,316.0)
43.0 (3,112,442.0) (2,138,124.0)
(46.8)
(4,731.0)
(4,936.0)
(23.9)
(21,508.0)
(24,090.0)
13.5
(2,993.0)
(2,612.0)
0.0
(95.0)
0.0
33.8
(23,467.0)
(22,666.0)
(49.0)
(42,806.0)
(63,576.0)
42.2 (1,091,356.0)
(790,682.0)
7.5
(35,278.0)
(30,927.0)
37.7
(860,100.0)
(625,469.0)
50.9
(132,751.0)
(91,747.0)
24.3
(122,728.0)
(91,548.0)
48.2
(32,131.0)
(21,786.0)
(185.6)
(22,784.0)
(75,680.0)
80.1
55,680.0
26,232.0
51.3
(191,757.0)
(130,237.0)
207.3
842,962.0
344,274.0
Var. %
42.5
44.8
9.8
(6.3)
16.4
41.7
(2.4)
99.0
0.0
51.3
24.8
217.5
35.4
80.1
14.4
34.6
133.7
(17.2)
11.0
45.6
(4.2)
(10.7)
14.6
0.0
3.5
(32.7)
38.0
14.1
37.5
44.7
34.1
47.5
(69.9)
112.3
47.2
144.9
Income Tax
PRE TAX AND PROFIT SHARING INCOME
Social contribution
Profit Sharing
360,621.0
(75,457.0)
(42,974.0)
(39,018.0)
113,887.0
(29,225.0)
(12,577.0)
(2,198.0)
207.3
158.2
241.7
0.0
842,962
(177,725)
(101,782)
(92,935)
344,274
(78,034)
(32,760)
(23,756)
145
128
211
291
INCOME BEFORE MINORITY INTEREST
MINORITY INTEREST
203,172.0
(86.0)
73,368.0
(70.0)
176.9
22.9
470,520.0
(190.0)
209,724.0
(92.0)
124.4
106.5
NET INCOME FOR THE QUARTER
203,086.0
73,298.0
177.1
470,330.0
209,632.0
124.4
19
Cash Flow
CASH FLOW STATEMENTS
FOR THE YEARS ENDED SEPTEMBER 30, 2010 AND JUNE 31, 2010
(In thousands of reais)
Consolidated
3Q10
CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME OF THE PERIOD
Prior year adjustment
Amortization
Goodwill amortization
Revenue from safe of fixed assets
Adjusted net income
(Increase) reduction of Assets
Variation of investment
Variation of issued premium
Variation of deferred expenses commercialization
Variation of credit operations
Securities and amounts receivables
Change in dividends receivable
Variation of tax
Variation of other accounts receivable
Variation of other values and goods
Variation of tax and deferred social security contribution
Change in reinsurance and retrocession expenses
Variation of court deposits
Increase (reduction) liabilities
Variation of accounts payable
Variation of Interbank loans
Variation of obligations by exchange acceptance bonds
Variation of Loans and on lending obligations
Variation of vacations and charges
Variation of tax
Variation of other deposits
Variation of commissions on issued premiums
Variation of other debts due
Variation of technical provisions - insurance and reinsurance
Variation of tax and deferred social security contribution
Variation of legal obligations
Variation of working contingencies and civil
Variation of adjusts with bonds
Variation of minority stakes
NET CASH BY OPERATING ACTIVITIES
CASH FLOW FROM INVESTING ACTIVITIES
Interest on equity and dividends received
Sale of fixed assets
Sale of investments
Acquisition of fixed assets
Acquisition of investments
Investment in deferred
NET CASH GENERATED BY (USED IN) INVESTING ACTIVITIES
CASH FLOW FROM FINANCING ACTIVITIES
Treasury stock
Distribution of interest on capital and dividends
CASH FLOW FROM FINANCING ACTIVITIES
INCREASE (DECREASE) OF CASH
CASH AT THE BEGINING OF THE PERIOD
CASH AT THE END OF THE PERIOD
INCREASE (DECREASE) OF CASH
2Q10
470,330
66,954
8,842
(367)
267,244
46,251
5,600
(232)
545,759
(816,419)
(184,714)
(30,312)
(7,741)
(52,704)
(80,180)
(58,958)
8,619
(79,722)
(22,992)
(2,745)
318,863
(475,899)
(37,866)
(2,096)
(10,442)
4,574
(19,795)
(21,053)
(8,961)
(42,789)
8,184
(11,941)
(1,327,868)
58,778
9,086
(4,295)
(39,859)
28,354
86,328
74,346
27,201
27,055
600,371
19,492
95,538
(3,036)
(1,332)
234
(618,084)
(42,798)
13,919
(31,725)
3,051
17,128
42,940
62,148
(12,618)
(12,908)
334,831
5,406
68,356
(2,239)
(799)
139
978,261
196,152
-
444,831
145,610
-
4,756
(86,854)
(361)
(22,459)
2,884
(44,449)
647
(11,680)
(104,918)
(52,598)
-
(100,925)
(101,417)
-
(100,925)
(10,183)
38,040
27,857
(10,183)
(7,913)
38,040
30,127
(7,913)
-
20

Porto Seguro disclosures its 3Q10 Results

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