GROUP’S IFRS FINANCIAL STATEMENTS SAMPO PLC’S FINANCIAL STATEMENTS BOARD OF AUDITOR’S DIRECTORS’ REPORT REPORT Group’s Notes to the Accounts Sampo plc’s Notes to the Accounts BOARD OF DIRECTORS’ REPORT AND FINANCIAL STATEMENTS BOARD OF DIRECTORS’ REPORT AND FINANCIAL STATEMENTS 2019 1 2019 GROUP’S IFRS FINANCIAL STATEMENTS SAMPO PLC’S FINANCIAL STATEMENTS BOARD OF AUDITOR’S DIRECTORS’ REPORT REPORT Group’s Notes to the Accounts Sampo plc’s Notes to the Accounts CONTENTS Board of Directors’ Report for 2019 .............. 3 Solvency .....................................................28 Sampo plc’s Notes to the Accounts ..........171 Sampo Group ..................................................... 4 Debt Financing ............................................29 Summary of Significant Account Policies...........172 Economic Environment ....................................... 6 Outlook ..........................................................31 Notes to the Income Statement 1–4 ..................172 Business Areas .................................................. 7 Outlook for 2020 .........................................31 Notes to the Assets 5–9 ...................................173 If .................................................................. 7 The Major Risks and Uncertainties Notes to the Liabilities 10–13 ...........................174 Topdanmark .................................................. 9 to the Group in the Near-Term .......................31 Note to the Income Taxes 14 ............................175 Associated Company Nordea ........................10 Dividends .......................................................32 Notes to the Liabilities and Commitments 15–16 .......................................176 Mandatum Life ............................................11 The New Dividend Policy ..............................32 Notes to the Staff and Management 17–19 ........176 Holding ......................................................13 Dividend Proposal .......................................32 Note to the Shares Held 20 ..............................177 Other Developments .........................................14 Key Figures ......................................................33 Changes in the Group Structure ...................14 Calculation of the Key Figures .......................36 Approval of the Financial Statements Changes in Group Management .................... 16 Group’s IFRS Financial Statements ...........38 and the Board of Directors’ Report ..........178 Governance and Related Issues ..........................18 Statement of Profit and Other Comprehensive ........................................... Governance ................................................ Auditor’s Report 179 18 Income, IFRS ....................................................39 Annual General Meeting ............................... 18 Consolidated Balance Sheet, IFRS ......................40 Corporate Responsibility ..............................19 Statement of Changes in Equity, IFRS .................41 Personnel ..................................................19 Statement of Cash Flows, IFRS ..........................42 Remuneration .............................................20 Risk Management ........................................21 Group’s Notes to the Accounts ....................43 Shares, Share Capital and Shareholders .............22 Summary of Significant Accounting Policies ........44 Shares and Share Capital ..............................22 Segment Information ........................................62 Authorizations Granted to the Board .............24 Material Partly-Owned Subsidiairies ....................67 Shareholders ...............................................24 Business Acquisitions ........................................68 Holdings of the Board Group’s Other Notes to the Accounts .................69 and Executive Management ..........................26 Financial Standing ...........................................27 Sampo plc’s Financial Statements ............167 Extra Dividend in the Form of Nordea Shares . 27 Sampo plc’s Income Statement ....................... 168 Internal Dividends ........................................27 Sampo plc’s Balance Sheet ............................. 169 REPORTS FOR THE YEAR 2019 WWW.SAMPO.COM/YEAR2019 Ratings .......................................................28 Sampo plc’s Statement of Cash Flows ...............170 BOARD OF DIRECTORS’ REPORT AND FINANCIAL STATEMENTS 2019 2 GROUP’S IFRS FINANCIAL STATEMENTS SAMPO PLC’S FINANCIAL STATEMENTS BOARD OF AUDITOR’S REPORT DIRECTORS’ REPORT Group’s Notes to the Accounts Sampo plc’s Notes to the Accounts BOARD OF DIRECTORS’ REPORT 4 6 7 14 18 Sampo Group Economic Business Areas Other Governance and Environment Developments Related Issues If ................................................... 7 Topdanmark ............................. 9 Changes in the Governance ............................18 Associated Company Group Structure ....................14 Annual General Meeting .... 18 Nordea .....................................10 Changes in Group Corporate Responsibility ...19 Mandatum Life ...................... 11 Management ..........................16 Personnel ................................19 Holding ....................................13 Remuneration ........................20 Risk Management ................ 21 22 27 31 32 33 Shares, Share Capital Financial Standing Outlook Dividends Key Figures and Shareholders Extra Dividend in the Outlook for 2020 .................. 31 The New Dividend Policy .. 32 Calculation of Form of Nordea Shares ...... 27 the Key Figures ..................... 36 Shares and Share Capital .. 22 The Major Risks and Dividend Proposal ............... 32 Internal Dividends ................ 27 Uncertainties to the Authorizations Group in the Near-Term ..... 31 Granted to the Board ......... 24 Ratings .....................................28 Shareholders ..........................24 Solvency ..................................28 Holdings of the Board and Debt Financing ..................... 29 Executive Management ..... 26 BOARD OF DIRECTORS’ REPORT 2019 3 GROUP’S IFRS FINANCIAL STATEMENTS SAMPO PLC’S FINANCIAL STATEMENTS BOARD OF AUDITOR’S REPORT DIRECTORS’ REPORT Group’s Notes to the Accounts Sampo plc’s Notes to the Accounts Sampo plc - Board of Directors’ Report for 2019 Sampo Group Sampo Group’s profit before taxes for 2019 amounted year (excluding extraordinary items). In addition share progress in the fourth quarter of 2019 towards achieving to EUR 1,541 million (2,094). The profit includes a loss buy-backs can be used to complement the cash dividend. its financial targets. In segment reporting the share of of EUR 155 million incurred when distributing Nordea Nordea’s profit is included in the segment ‘Holding’. For shares as dividends in the third quarter of 2019. The profit If segment’s profit before taxes rose to EUR 884 million 2019 Nordea targets a dividend of EUR 0.40 per share for the for the comparison year contains a positive non- (848). Underwriting performance continues on its (0.69). If the AGM approves this, Sampo plc will receive a recurring item of EUR 197 million from the Danske Bank excellent track. Insurance technical result amounted to dividend of EUR 322 million (594). co-operation agreement that Mandatum Life completed EUR 685 million (643) and combined ratio for full-year in the second quarter of 2018. The total comprehensive 2019 was 84.5 per cent (85.2). Return on equity amounted Profit before taxes for the segment Mandatum amounted income for the period, taking changes in the market value to 34.5 per cent (11.2). Premiums grew strongly in all to EUR 280 million (450). The profit for the comparison of assets into account, rose to EUR 1,565 million (1,034). business areas in the Nordics amounting to 5.7 per cent year includes a contribution of EUR 197 million from with fixed currencies. If lowered the discount rate applied the Danske Bank co-operation agreement in the second Earnings per share was EUR 2.04 (3.04) and marked-to- in Finland from 1.2 per cent to 0.95 per cent. This had a quarter of 2018. Return on equity rose to 23.5 per cent market earnings per share was EUR 2.63 (1.70). Marked- negative impact of EUR 62 million on the results. If paid a (8.7). Mandatum Life’s Board proposes a dividend of EUR to-market earnings were boosted by strong equity market dividend of SEK 7.5 billion (EUR 710 million) to Sampo plc 150 million to be paid to Sampo plc in the first quarter of development. Return on equity for the Group amounted in December 2019. 2020. to 12.0 per cent (7.5) for 2019. Net asset value per share on 31 December 2019 increased to EUR 20.71 (20.60). Topdanmark had another strong year and segment’s profit Sampo Group’s total investment assets, excluding before taxes rose to EUR 238 million (199). The combined Topdanmark’s life insurance assets, on 31 December 2019 Sampo plc’s Board of Directors is proposing at the Annual ratio amounted to 82.1 per cent (82.3). Topdanmark’s amounted to EUR 21.8 billion (21.7), of which 76 per cent General Meeting to be held on 23 April 2020 a dividend Board of Directors proposes to the AGM of 2020 a was invested in fixed income instruments (79), 16 per cent of EUR 2.20 per share (2.85). The proposed dividend pay- dividend of DKK 17 per share. If approved Sampo plc’s in equities (14) and 8 per cent in other assets (7). If’s share ment amounts in total to EUR 1,222 million (1,583). The share of the