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Management Report

Swiss Life Holding increased its profit in the 2018 financial year from CHF 314 million to CHF 460 million.

The annual profit of Swiss Life Holding in 2018 mainly consisted of dividends and investment income. Dividend payments from subsidiaries to the holding company increased from CHF 555 million to CHF 623 million during the year under review. New loans totalling CHF 203 million were awarded to Group units for the acquisition of Fincentrum and Beos. In addition, new loans totalling EUR 75 million were awarded to Group units in Germany and France to finance new real estate projects. Less repayments, loans to Group companies increased from CHF 758 million in the previous year to CHF 986 million.

As at the end of the year, Swiss Life Holding had assets (liquid funds, receivables due from subsidiaries, debt securities, investment funds and equities) of CHF 1678 million. Liquid funds increased from CHF 65 million to CHF 118 million, and debt security, investment fund and equity holdings reduced from CHF 1647 million to CHF 1524 million. One of the reasons is the financing of the share buyback announced in 2018, for a total value of CHF 1000 million. Shares were bought back in the amount of CHF 87 million. All debt securities in the possession of Swiss Life Holding may be pledged as collateral.

The new loans caused interest income to rise from CHF 24 million to CHF 27 million and earnings from investments in bonds and fund units rose from CHF 44 million to CHF 46 million. Overall, other finance income rose from CHF 68 million to CHF 74 million. All loans granted internally and external investments in foreign currencies are fully hedged with currency futures. The cost of hedging during the reporting period was CHF 30 million (2017: CHF 18 million). The investment book value decreased from CHF 3416 million to CHF 3216 million during the reporting year due to an allowance of a subsidiary.

Swiss Life Holding’s profit distribution to shareholders in the period under review came to CHF 460 million, or CHF 13.50 per share, and was made out of the capital contribution reserve. The par value of the share as well as Swiss Life Holding’s nominal share capital stand unchanged at CHF 5.10 and CHF 175 million, respectively.

The long-term debt capital remained unchanged during the reporting year at CHF 424 million. This consists of two senior bonds in the total nominal amount of CHF 425 million, comprising a tranche of CHF 225 million with a six-year maturity (coupon 1.125%; maturing 2019) and a tranche of CHF 200 million with a ten-year maturity (coupon 1.875%; maturing 2023). These debt financing instruments were issued in 2013. Interest on the bonds came to CHF 7 million.

Staff costs and operating expenses including taxes dropped from CHF 22 million to CHF 15 million. The reduction is due to the stamp duty on issues resulting from the convertible bond conversions in the previous year.