The year 2012 proved to be quite satisfying as far as Ageas's share price performance was concerned both in absolute as well as in relative value terms. In absolute terms, Ageas's shares rose from EUR 12.0 at the end of 2011 to EUR 22.2 at the end of 2012. Some EUR 2.5 billion was created in terms of shareholder equity value over the last trading year. And at the end of 2012, Ageas was among the ten largest Belgian companies based on its market capitalisation, which amounts to EUR 5.4 billion.
In relative terms, the shares also did very well. Ageas shares gained 85% during 2012, outperforming the Dow Jones Euro Stoxx Insurance Index by 51%, and making Ageas the best performing company in this important benchmark index.
The year began on a positive note with Ageas’s shares closing 3.2% higher on the very first day of trading. The momentum continued with the share price benefiting in the first few weeks from the share buyback programme announced in the summer of 2011 and completed at the end of January 2012. Those 192,168,091 shares, corresponding to 7.33% of total shares outstanding with a value of EUR 250 million, were subsequently cancelled at the Annual General Meetings of Shareholders held in Brussels and Utrecht in April.
Immediately following the completion of the share buyback programme, another important milestone was achieved when Ageas and Fortis Bank reached agreement on a partial settlement of the RPN(I) and the full call of Fortis Bank Tier 1 instruments. The market reacted very favourably to this news with Ageas’s shares closing 9.6% higher on the day of the announcement.
At the end of the first quarter Ageas hit the headlines again with the announcement of another step in the plan to simplify its legal structure, which was its proposal to merge ageas N.V. and ageas SA/NV and to effect a 10 to 1 reverse stock split. Following shareholder approval at the Extraordinary General Meetings of Shareholders in Brussels and Utrecht, the merger as well as the reverse stock split became effective in August.
Meanwhile Ageas and ABN AMRO reached a settlement in their legal dispute with regard to FCC (Fortis Capital Company) and the MCS (mandatory convertible securities), resulting in a one-off cash payment of EUR 400 million to Ageas by ABN AMRO. In the four trading days after this was announced at the end of June, Ageas’s shares rose 18.9%, implying that the investor community appreciated Ageas’s ongoing efforts to reduce its complexity as a group.
The most significant news during the summer was the publication of the six-month figures. The market rewarded Ageas with a 5.2% increase in the share price on top of the already impressive 7.6% gain just days earlier. The announcement of the partnership with Natixis on corporate loans and the EUR 200 million share buyback were the main drivers for investors. Since the start of the share buyback programme in August 2012, Ageas has repurchased 7 million shares for a total of EUR 137 million, representing 2.9% of the total shares outstanding.
And last but not least, at the end of November Ageas completed the Groupama UK acquisition that has positioned Ageas as the fifth largest Non-Life insurer in the UK.
As investors reflect on what has been a strong performance by Ageas over the past year, a clear theme has begun to emerge, namely recognition of the company’s untapped potential. As one analyst observed: “We continue to buy Ageas”. We like the attractive cash return and unrecognised value of non-operating items.” Others reflect on the opportunities for growth: “The 2012 Investor Day demonstrated that there is ample opportunity for growth in Non-Life and we also see growth openings in Life.”
So to sum up, 2012 was a good year for Ageas shares, which witnessed a positive response from investors to the company’s proactive measures and financial performance.