GROUPAMA / 2018 Registration document

EARNINGS AND FINANCIAL POSITION MANAGEMENT REPORT OF THE BOARD OF DIRECTORS

although the good performance of the group retirement (+30.7%) and group health (+24.6%)segmenteddampened this trend. Insurance premium income in France represented 74.6% of the Group’s overall business over the period, whereas international insurance premium income amounted to 23.8% of total premium

income. The Group’s other businesses (financial and banking businesses) represented 1.6% of total premium income. Net banking income from these businesses amounted to €153 million

at 31 December2018.

Economic operating income (in millions of euros)

31.12.2017

31.12.2018

Change in value

Change %

Property and casualty insurance – France

8

66

58

NA

Life andhealth insurance – France

118

128

10

8.9%

TotalInsurance – France

126

194

68

>100%

Property and casualty insurance – International

43

13

(30)

-69.5%

Life andhealth insurance – International

41

30

(11)

-26.7%

TotalInsurance – International

84 32

43 34

(41)

-48.5%

Banking and financialbusinesses

3

9.2%

Holding activities

(45)

(89)

(44)

96.9%

Total– Groupama

196

182

(14)

-7.3%

Property and casualty insurance

51

79

28

NA

Life andhealth insurance

159

158

(1)

-0.9%

The Group’s economic operating income totalled €182 million at 31 December 2018 compared with €196 million at 31 December 2017. Insurance economic operating income amounted to +€237 million in 2018, up €28 millioncomparedwith 2017. Economic operating income from life and health insurance totalled +€158 million in 2018, stable over the period (+€10 million in France and -€11 million internationally). In France, this increase was mainly due to the improved technical margin with a net combinedratio of the health and personal injuryactivities improving by -0.6 pointsto 100.7%. In property and casualty insurance, economic operating income amounted to +€79 million compared with +€51 million at 31 December 2017 (+€58 million in France and -€30 million internationally). The net non-life combined ratio was thus 100.1% in 2018 versus 100.3% in 2017 (-0.2 points).In France, 2018 was marked by a significant increase in serious claims, while, conversely, the cost of weather claims decreased after a 2017 affectedby HurricanesIrma andMaria in theCaribbean.Due to the nature of the claims (few very major weather claims), reinsurance protectionwas lower in 2018 than in 2017, resulting in a stable net reinsurancecost. Also noteworthy is the favourable effect on other technical reserves and changes on prior affairs, partly tied to a

natural change in cases and partly to regulatory developments (ANC, Gazette du Palais), the effect of which was contrary and slightly favourable. In the Internationalmarket, the non-life net loss experienceincreased by +2.4 points to 69.9% in2018. Banking and financial businesses contributed +€34 million to the Group’s economic income in 2018. The Group’s holding activity posted an economic operating loss of -€89 million in 2018, comparedwith a loss of -€45 millionin 2017. The Group’s net income totalled +€319 million at 31 December 2018 compared with +€87 million at 31 December 2017. The 2018 result includes notably an increase in the non-recurring financial margin (+€123 million),benefitingmainly from the increase in capital gains realised due in particular to the sale of a property in La Défense. The 2018 income also includes: the result from divested activities of -€2 millionfollowing the sale ❯ of Portuguesesubsidiaries; tax expenses mainly related to the gradual reduction of the tax ❯ rate in France amounting to -€6 million; other non-recurring expenses related to various projects ❯ amounting to -€10 millionas well as the equity-methodresult of Orange Bank for -€59 million (versus -€35 millionin 2017).

6

159

REGISTRATION DOCUMENT 2018 - GROUPAMA ASSURANCES MUTUELLES