Powszechny Zaklad Ubezpiecze? Spólka Akcyjna : Financial statement of the PZU Group (Q2 2022)

Powszechny Zakład Ubezpieczeń Spółka Akcyjna

Group

Condensed interim

consolidated financial statements for the 6 months ended

30 June 2022

Powszechny Zakład Ubezpieczeń Spółka Akcyjna Group
Condensed interim consolidated financial statements for the 6 months ended 30 June 2022
Table of contents
Interim consolidated profit and loss account....................................................................................	3
Interim consolidated statement of comprehensive income.............................................................	4
Interim consolidated statement of financial position.......................................................................	5
Interim consolidated statement of changes in equity ......................................................................	6
Interim consolidated cash flow statement ........................................................................................	9
Notes to the condensed interim consolidated financial statements .............................................	11
1.	Introduction ..............................................................................................................................................................	11
2.	Information on PZU and the PZU Group ..................................................................................................................	14
3.	Composition of the Management Board, Supervisory Board and PZU Group Directors........................................	24
4.	Key accounting policies, key estimates and judgments..........................................................................................	26
5.	Information about major events that materially influence the structure of financial statement items ...............	37
6.	Corrections of errors from previous years ...............................................................................................................	37
7.	Material events after the end of the reporting period .............................................................................................	37
8.	Supplementary notes to the condensed interim consolidated financial statements............................................	39
9.	Assets securing receivables, liabilities and contingent liabilities ...........................................................................	80
10.	Contingent assets and liabilities ..............................................................................................................................	80
11.	Equity management .................................................................................................................................................	81
12.	Segment reporting....................................................................................................................................................	82
13.	Information on the changes in the economic situation and business conditions exerting a material effect on the
	fair value of financial assets and liabilities. .............................................................................................................	92
14.	Issues, redemptions and repayments of debt securities and equity securities......................................................	92
15.	Default or breach of material provisions of loan agreements.................................................................................	92
16.	Disputes.....................................................................................................................................................................	93
17.	Related party transactions .......................................................................................................................................	96
18.	Other information .....................................................................................................................................................	97

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Powszechny Zakład Ubezpieczeń Spółka Akcyjna Group

Condensed interim consolidated financial statements for the 6 months ended 30 June 2022 (in millions of PLN)

Interim consolidated profit and loss account

					1 April -		1 January -		1 April -			1 January -
	Consolidated profit and loss account		Note				30 June 2021			30 June 2021
			30 June 2022		30 June 2022
							(restated) 1)			(restated) 1)
	Gross written premiums		8.1	6,394	12,647	6,194		12,342
	Reinsurers' share in gross written premium			(346)	(477)	(293)	(446)
	Net written premiums			6,048	12,170	5,901		11,896
	Movement in net provision for unearned			(125)	(487)	(70)	(379)
	premiums
	Net earned premium			5,923	11,683	5,831		11,517
	Revenue from commissions and fees		8.2	1,326	2,549	1,161		2,226
	Interest income calculated using the effective	8.3	4,854	8,434	2,315	4,675
	interest rate
	Other net investment income		8.4	(207)	(196)	286		254
	Result on derecognition of financial	8.5	(119)	(227)	14	526
	instruments and investments
	Movement in allowances for expected credit
	losses and impairment losses on financial		8.6	(882)	(1,276)	(445)		(883)
	instruments
	Net movement in fair value of assets and	8.7	(122)	(43)	250	380
	liabilities measured at fair value
	Other operating income		8.8	428	837	379		752
	Claims, benefits and movement in technical			(3,528)	(7,392)	(4,170)		(8,186)
	provisions
	Reinsurers' share in claims, benefits and			102	276	26	116
	movement in technical provisions
	Net insurance claims and benefits		8.9	(3,426)	(7,116)	(4,144)		(8,070)
	Fee and commission expenses		8.10	(359)	(663)	(283)		(539)
	Interest expenses	8.11	(883)	(1,251)	(71)	(197)
	Acquisition expenses		8.12	(959)	(1,876)	(867)		(1,704)
	Administrative expenses	8.12	(1,938)	(3,719)	(1,732)	(3,412)
	Other operating expenses		8.13	(1,757)	(3,048)	(940)		(2,156)
	Operating profit			1,879	4,088	1,754	3,369
	Share of the net financial results of entities			(6)	(17)	(2)		(8)
	measured by the equity method
	Profit before tax			1,873	4,071	1,752	3,361
	Income tax		8.14	(615)	(1,203)	(419)		(874)
	Net profit, including:			1,258	2,868	1,333	2,487
	- profit attributable to the equity holders of the			722	1,480	754		1,634
	Parent Company
	- profit (loss) attributed to holders of non-			536	1,388	579	853
	controlling interest
	Weighted average basic and diluted number of	8.15		863,390,985		863,384,065		863,339,389			863,341,671
	common shares
Basic and diluted profit (loss) per common	8.15	0.84	1.71	0.87	1.89
share (in PLN)

1. Information on restatement of data for the period from 1 April to 30 June 2021 and 1 January - 30 June 2021 is presented in section 4.4.

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Powszechny Zakład Ubezpieczeń Spółka Akcyjna Group

Condensed interim consolidated financial statements for the 6 months ended 30 June 2022 (in millions of PLN)

Interim consolidated statement of comprehensive income

Consolidated statement of comprehensive				1 April -		1 January -		1 April -			1 January -
	Note				30 June 2021		30 June 2021
income			30 June 2022		30 June 2022
					(restated)	1)		(restated) 1)
	Net profit				1,258		2,868			1,333		2,487
Other comprehensive income	8.14	(2,420)	(4,657)			(542)	(1,273)
	Subject to subsequent transfer to profit or				(2,372)		(4,672)			(591)		(1,371)
	loss
	Valuation of debt instruments			(881)	(1,991)			(335)	(699)
	Measurement of loan receivables from				(3)		(4)			(32)		(36)
	clients
	Foreign exchange translation differences			9	27			(54)	(28)
	Cash flow hedging				(1,497)		(2,704)			(170)		(608)
	Not to be transferred to profit or loss in the			(48)	15			49	98
	future
	Valuation of equity instruments				(62)		1			49		98
	Actuarial gains and losses related to			14	14			-	-
	provisions for employee benefits
	Total net comprehensive income				(1,162)		(1,789)			791		1,214
- comprehensive income attributable to equity			(324)	(437)			547	1,128
holders of the Parent Company
	- comprehensive income attributable to holders				(838)		(1,352)			244		86
	of non-controlling interest

1. Information on restatement of data for the period from 1 April to 30 June 2021 and 1 January - 30 June 2021 is presented in section 4.4.

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Powszechny Zakład Ubezpieczeń Spółka Akcyjna Group

Condensed interim consolidated financial statements for the 6 months ended 30 June 2022 (in millions of PLN)

Interim consolidated statement of financial position

Assets	Note		30 June		31 December
2022	2021
	Goodwill		8.16		2,800		2,778
Intangible assets	8.17	3,138	3,403
	Deferred tax assets				3,352		3,058
Other assets	8.18	833	633
	Deferred acquisition costs				1,678		1,573
Reinsurers' share in technical provisions	8.32	2,515	2,540
	Property, plant and equipment		8.19		4,235		4,144
Investment property		2,930	2,773
	Entities measured by the equity method		8.20		79		93
Assets securing liabilities	8.24	8,485	1,336
	Assets held for sale		8.21		665		643
Loan receivables from clients	8.22	217,502	215,008
	Financial derivatives		8.23		19,363		8,328
Investment financial assets	8.25	129,065	136,954
	Measured at amortized cost				83,575		82,893
	Measured at fair value through other comprehensive income		37,316	44,896
	Measured at fair value through profit or loss				8,174		9,165
Receivables	8.26	13,328	9,418
	Cash and cash equivalents				19,968		9,447
Total assets		429,936	402,129
Equity and liabilities		Note		30 June		31 December
	2022	2021
	Equity
Equity attributable to equity holders of the parent			14,969	17,080
	Share capital		8.31	86	86
	Other capital			13,897	14,343
	Retained earnings			986	2,651
	Retained profit or loss			(494)	(685)
	Net profit			1,480	3,336
Non-controlling interest			20,659	22,914
	Total equity			35,628	39,994
	Liabilities
Technical provisions		8.32	50,090	50,173
	Subordinated liabilities		8.33	6,135	6,274
Liabilities on the issue of own debt securities		8.34	7,940	5,940
	Liabilities to banks		8.35	7,758	7,470
Liabilities to clients under deposits		8.36	268,729	265,155
	Financial derivatives		8.23	25,851	11,880
Other liabilities		8.37	25,810	13,203
	Provisions		8.38	1,297	1,206
Deferred tax liability			668	806
	Liabilities related directly to assets classified as held for sale		8.21	30	28
Total liabilities			394,308	362,135
	Total equity and liabilities			429,936	402,129

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