Grupo SURA’s consolidated earnings at the end of Q1 2021 showed a recovery on the part of our portfolio companies along with a good deal of progress made by our subsidiaries in the face of the current pandemic

  • Grupo SURA’s subsidiaries have implemented various initiatives throughout the region as they have continued to help and support our clients and tackle the effects of the pandemic through their different business lines namely insurance, health care, savings, investment and asset management.
  • It is worthwhile noting the recovery seen with revenues obtained via the equity method from associates such as Bancolombia, Grupo Nutresa, Grupo Argos and Proteccion.
  • Positive levels of business performance along with strict controls over spending on the part of Suramericana and Sura Asset Management, allowed us to move more towards the levels of performance recorded prior to the pandemic
  • Grupo SURA, in its role as investment manager, began to carry out stock buy-back operations on the Colombian Stock Exchange, a tool that represents an efficient capital allocation for both the Company and its shareholders.

Medellín. May 14, 2021 This Friday Grupo SURA reported its financial results for the first quarter of 2021, while highlighting the commitment shown by Suramericana and SURA Asset Management (SURA AM) in providing assistance and support to the Latin American people in the midst of the current COVID-19 pandemic while driving the reactivation of the region’s economy.

In this sense, initiatives such as that carried out by AFP Integra, the pension fund subsidiary of SURA AM in Peru, which created its Solidarity Fund, financed with 1% of the Company's income and aimed at providing disability or survivor’s insurance coverage to subscribers having no access to such benefits. On the other hand, Suramericana’s Colombian subsidiary has vaccinated more than 400 thousand EPS SURA subscribers against the Coronavirus, at 91 vaccination centers, with a total capacity for applying around 25 thousand doses per day, depending on the availability of these vaccines.

As for the Group’s consolidated earnings, it is well worth noting a growth of 13.7% in revenues compared to those obtained for the same period last year, while operating expense rose at a slower rate of just 6.3%, this due to the positive levels of business performance on the part of both subsidiaries, in spite of the challenges posed in different countries in terms of vaccinations as well as new outbreaks of the Coronavirus and its effects on the region’s economies and job markets.

“These first quarter results are better than expected, and come hand in hand with our commitment to life, to driving economic recovery throughout the region and, of course, to providing our help and support for public and private efforts aimed at mitigating the impact of the current pandemic. Grupo SURA's investments have shown an overall recovery in terms of subsidiary performance along with better results from our associates, which have amply evidenced the importance of our business portfolio for both private individuals and companies”, stated Gonzalo Pérez, Chief Executive Officer of Grupo Sura.

Highlights -Q1 2021

 In the case of Suramericana, its companies have allocated more than USD 534.9 million*to initiatives relating to tackling the pandemic since when it first began up to the end of this first quarter. In Colombia, the efforts made to save lives produced a COVID-19 fatality rate among SURA subscribers and policy-holders representing a mere third of the nation-wide average (0.8% vs. 2.6%) based on data made available on May 10. In addition, SURA’S Diagnostic Aids Provider expanded its capabilities for processing COVID tests with a new molecular biology lab, as well as implementing multivehicle vaccinations for EPS SURA subscribers.

In Chile headway is being made with another initiative aimed at encouraging healthier lifestyle habits; while in Mexico and El Salvador more agile on-line channels were created to make it easier for people to acquire solutions. In Argentina, a new Work Life Insurance was launched given prevailing uncertainties with employability, as well as a new digital protection solution, among other initiatives, which is being consolidated in all nine countries where Seguros SURA is present.

As for SURA Asset Management, it is worth noting the educational campaigns being deployed by the pension fund subsidiaries, AFP Integra (Peru) and AFP Capital (Chile), these aimed at creating greater awareness of the importance of savings, given recent regulatory changes that authorized partial pension withdrawal, for which agile and timely channels have been set up to attend to requests from pension fund members. Likewise, Proteccion (Colombia) is helping to drive economic reactivation through its Digital Master Class initiative, this consisting of day-long courses benefiting thousands of SMEs and entrepreneurs who are receiving training lasting for three days, totally free of charge, these given by experts in innovation trends, digital transformation, marketing, sustainability and human talent.

For its part, Afore SURA (Mexico) was a pioneer in setting up a mobile app enabling fund members to carry out self-managed on-line transfers, which at the same time is a simple tool that is promoting the formalization of jobs for millions of workers, especially young people, who have not as yet registered with the Mexican pension system. This initiative makes it easy for them to check in real time whether their employers are making their respective retirement savings contributions and is an opportunity to begin with their voluntary savings.

 Consolidated financial results for the first quarter of 2021

Growths in written premiums and fee and commission income on the part of our subsidiaries, a recovery in returns from the proprietary investments made by our own pension fund management firms (legal reserves), as well as an increase in the revenues received via the equity method from the stakes held by Grupo SURA in other companies, all combined to provide an operating income of USD 1,564 million.

“Our consolidated results for this first quarter of the year show clear signs of a recovery with our portfolio investments. We are seeing the benefits of a well-balanced portfolio that is driving the growth of our revenues and bottom line, as well as the headway made by Suramericana and SURA Asset Management in consolidating efficient operating models together with a considerable improvement in the amounts of revenues received via the equity method from Bancolombia, Grupo Nutresa and Grupo Argos”, explained Ricardo Jaramillo, Chief Business Development and Finance Officer of Grupo SURA.

Also, worth noting is the controlled rise in expense of just 6.3%, thanks to our ongoing focus on gaining greater efficiencies together with operating expense that dropped by just 0.4%, in spite of the increase in claims with Suramericana's Life and Health Care Insurance segments. Consequently, operating earnings came to COP USD 140.7 million, which were higher than those reported for the same period last year, but still lower than for a “pandemic-free” year such as 2019. The same occurred with our bottom line, which stood at USD 59.4 million. As for the results obtained by each of our core subsidiaries:

SURA Asset Management recorded a growth of 7.5% in fee and commission income, mainly driven by its line of Retirement Savings (pensions), Inversiones SURA (savings for private individuals) and SURA Investment Management (asset management for institutional clients). Also, worth noting is this subsidiary’s firm control over operating expense, which increased by 0.8% compared to the same period last year. Consequently, net income from all its lines of business came to USD 32.6 million. Finally, it is well worth noting the 16.6% growth in assets under management compared to the same period last year, these reaching USD 150,111** million.

Suramericana obtained a 7.3% growth in written premiums, which totaled USD 1.296 million, while maintaining a strict control over expense, which increased by just 1.6%. However, retained claims rose by 14.5%, mainly in the Life and Health Care segments, although it is important to bear in mind that that the pandemic was still at an early stage during the first quarter last year, and the material effects were relatively non-existent compared to the spikes of COVID-19 occurring during the first quarter of this year especially in Colombia. In the end, this subsidiary recorded a net loss of USD -3 million, in line with what was budgeted by the Company due to an increase in the aforementioned claims rate.

Other Important Highlights

  • Grupo SURA began to buy back its own ordinary and preferred shares on the Colombian Stock Exchange, becoming the first issuer to use this mechanism as provided through the trading systems made available on the local market. This operation was approved up to a maximum amount of COP 300,000 million and for a term ending in March 2023.
  • SURA Asset Management, through AFP Integra (Peru) and Protección (Colombia), announced its participation in BlackRock’s investment fund ETF US Carbon Transition Readiness, being one of the few Latin American investors to sign up. This investment alternative shall focus on companies that encourage the transition to a low-carbon economy.
  • The SURA Foundation was ranked by the OECD as one of the three organizations with the highest social investment in Colombia between 2013 and 2018. Over the last 15 years, the SURA Foundation has invested almost COP 183 billion in social, educational and cultural initiatives.
  • Seguros SURA Colombia inaugurated the largest Multivehicular Vaccination Center in the Department of Antioquia. As an example of a joint public-private effort, this center was recently inaugurated, with a capacity to vaccinate up to 150 thousand people per month, depending on vaccine availability.

Figures in dollars:
* Figures in the Comprehensive Income Statement, at the average exchange rate of 1Q 2020: COP 3,552.8.
** Figures from the Statement of Financial Position, at the exchange rate as of March 31: COP 3,678.6.