Review of Operations | Swiss Life Holding generated a profit of CHF 335 million in the 2007 financial year, up on the previous year’s figure of CHF 249 million.
Total income at Swiss Life Holding rose from CHF 261 million to CHF 350 million. This growth reflected the increase from CHF 231 million to CHF 331 million in dividends received on participating interests. More than one third of the dividend income was generated abroad. In addition, dividend income was broadly diversified between the segments.
The interest received on loans made to Group companies was up slightly due to a new loan to the amount of CHF 100 million to Swiss Life (Liechtenstein) AG. This represented part of the funding for the takeover of CapitalLeben. The company resulting from the merger between Swiss Life (Liechtenstein) AG and CapitalLeben was incorporated into Swiss Life International Holding AG, in which Swiss Life groups together its foreign insurance companies. With this step, Swiss Life continued to streamline the Group structure during the reporting period.
In addition, the company founded two new subsidiaries in the period under review: Swiss Life Beteiligungs GmbH, Munich, and Pulse SA, Luxembourg, the latter of which was renamed Swiss Life Products (Luxembourg) SA in February 2008. Swiss Life Beteiligungs GmbH is the acquiring company for the stake in AWD Holding AG. Pulse SA is creating a central platform for the development and management of innovative products which will be available for sale internationally from mid 2008
Swiss Life Holding’s liquid assets (liquid funds plus time deposits and comparable instruments) fell from CHF 649 million to CHF 159 million. Swiss Life Holding used excess liquid funds to expand its position in its own shares.
Swiss Life Holding’s profit distribution to shareholders in the reporting period came to CHF 245 million, or CHF 7 per share. It took the form of a repayment of par value. The par value of the Swiss Life Holding share was thereby reduced from CHF 41 to CHF 34 and the share capital decreased from CHF 1385 million to CHF 1189 million. Conversion of outstanding convertible bonds into shares led to an increase in the share capital of CHF 49 million. The nominal value of the CHF 317 million’s worth of convertible bonds issued in 2004 was thereby reduced to CHF 68 million. The convertible bond expires in June 2010. The conversion price at the time of writing is CHF 209.15. Apart from the convertible bond issue, Swiss Life Holding is financed entirely by equity.
The total expenses of Swiss Life Holding, including tax expenses, rose by CHF 3 million vis-à-vis the previous year to stand at CHF 15 million. The increase was mainly due to higher commission expense in connection with the considerable rise in conversions of the convertible bond issue.
