PZU’s investor relations

Meeting stringent information governance requirements for public companies and fulfilling information needs of different groups of stakeholders, the Management Board of PZU undertakes various investor relations activities aimed at improving transparency in the company and procuring equal access to information. Therefore, PZU has consistently applied the “Principles for PZU to Conduct its Information Policy for Capital Market Participants”.

PZU’s shareholder structure

As at 31 December 2018, the Company was aware of two shareholders controlling more than 5% of its share capital and votes at the PZU Shareholder Meeting: the State Treasury of the Republic of Poland (34.2%) and NN OFE/NN DFE⁵ (5,1%)6 SECTION 9.6. PZU’S SHARE CAPITAL AND SHAREHOLDERS

According to a survey⁷ carried out at the end of 2018, PZU’s shareholder structure remained stable and diversified. The share of foreign investors increased 0.6 p.p. y/y to 35.0% at the expense of domestic investors, which resulted predominantly from a lower exposure of retail investors. The (benchmark) year 2017 was a record year for this group of investors, which was related, without limitation, to very large improvements in major market indices (WIG20 by 26.4% and WIG by 23.2%). At the same time, the share of retail investors in trading on the whole regulated market in 2018 decreased to 12% (-4 p.p.). The share of foreign retail investors (in PZU) remained at a similar level to that of 2018 and stood at 1.0%.

Open-end pension funds and fund management companies in the shareholder structure of PZU in 2014-2018

Source: IPREO

North American investors 2014-2018

Source: IPREO

PZU shareholder structure - main investor groups

Source: IPREO

In 2018, the structure of Polish institutional shareholders remained stable. At yearend 2018, the shares of open-end pension funds and fund management companies in PZU’s share capital were 17.4% (-0.6 p.p.) and 4.9% (+0.5 p.p.), respectively.

The increase in the share of foreign investors in 2018 was due chiefly to capital inflow from North America, which in the last five years has grown by as much as 8.1 p.p.

As regards European institutional shareholders (excluding the State Treasury of the Republic of Poland), the leading position was again kept by investors from the United Kingdom. However, in contrast to 2017, the exposure of German funds increased, with their share up from 1.7% to 2.5% (calculated in relation to European institutional shareholders, excluding the State Treasury). 

Geographical structure of PZU’s shareholders

* Polish State Treasury – 295.2 m shares (34.2% share in capital)

Source: IPREO

In 2018, PZU continued to hold regular meetings with representatives of its Management Board devoted to the publication of the Company’s quarterly results. Another significant event was the announcement of the Company’s strategy. All corporate events held with capital market participants in mind were broadcast live over the internet (with simultaneous translation into English). The recorded meetings are available on PZU’s website in the investor relations section at https://www.pzu.pl/relacje-inwestorskie/do-pobrania.

The Company’s key events, achievements and plans are again presented in the form of an online Annual Report at annualreport2017.pzu.pl. Users have been provided with tools enabling a multi-directional analysis of corporate and macroeconomic events as well as financial results. The report includes interactive infographics, animations and video materials, which offer a succinct presentation of PZU Group’s activity in 2017.

In 2018, the new version of the www.pzu.pl website also contains a revamped section on investor relations. www. pzu.pl/ri. The improved website provides easy access to an abundance of information. The refreshed version of the website can also be used conveniently on a smartphone and the visual message has been made more attractive through the use of micro animations. The change in the communication method is supported by UX GLOSSARY (user experience) solutions.

Activities addressed to institutional investors

In 2018, PZU representatives participated in the following:

• 2 non-deal roadshows in New York City, Boston, Chicago and Tokyo (3 in 2017);
• 14 international finance conferences attended by global institutional investors (12 in 2017);
• 6 conferences for institutional investors held in Warsaw (4 in 2017);

During which 241 meetings (161 in 2017) with 437 managers (368 in 2017) were held.

Additionally, in 2018 PZU actively met with investors and analysts at the company’s headquarters. Approximately 50 meetings and conference calls were held with approx. 80 institutional investors and approx. 70 meetings and conference calls with analysts issuing recommendations for PZU stocks.

Investment centers visited in 2018 (number of visits)

Activities addressed to retail investors

In 2018, PZU engaged in an active dialog with retail investors, in particular by providing them with reliable and up-to-date information on the activities of PZU, the insurance industry and the Company’s financial results. In this respect, PZU implemented both communication projects (e.g. the online report, a newsletter, a factsheet, mass mailing) and took active steps to enable direct contact between investors and the Company’s representatives, including, in particular:

• for the 8th time, it participated in the largest conference for retail investors from Central and Eastern Europe organized in Poland by the Polish Association of Individual Investors: the 22st Wall Street Conference in Karpacz;
• held 4 chats with retail investors hosted by a Member of the PZU Management Board in charge of the PZU Group’s Finance Division each time after the publication of its quarterly financial results, and 1 chat after the publication of the #nowePZU Strategy; 

Without interruption since 2012, PZU has also been participating in a program conducted by the Polish Association of Individual Investors called “10 of 10: Communicate Effectively) whose purpose is to develop high communication standards between public companies and retail investors.

Prizes and distinctions for IR activities

PZU’s investor relations activities are highly regarded by investors, analysts and the media. In 2018, PZU received the following prizes and distinctions (among others) in this area:

• First place for Tomasz Kulik, CFO of the PZU Group, in ranking of the best CFOs for investor relations in Poland in the Extel 2018 survey;
• Second place for the Investor Relations team in the ranking of the best investor relations in Poland in the Extel 2018 survey;
• First place in the Best Annual Report 2017 contest in the Banks and Financial Institutions category;
• special prize for the best on-line annual report in the Banks and Financial Institutions category;
• distinction for the best management activity report in the Banks and Financial Institutions category;
• distinction for the best IFRS/IAS-compliant financial statements in the Banks and Financial Institutions category.   

IR objectives in 2019

The main objectives of PZU’s investor relations function in 2019:

• strengthen good relations between the PZU Management Board and the community of investors, both in the local market and in the global market;
• ensure understanding and approval for PZU’s business strategy among investors and analysts;
• secure a deep and broad market for PZU’s shares and bonds by continuing investor-friendly measures to build a diversified base (in terms of geography, numbers and profile) of an appropriate number of well-informed investors familiar with the company, in particular by increasing pressure on acquiring investors from Asia;
• ensure a reliable valuation for PZU’s stock by providing sell-side analysts of investment banks and brokerage houses GLOSSARY with high quality information about PZU’s operations, industry trends, drivers of financial performance and feedback after analysis of their recommendations;
• ensure sell-side research coverage, in particular among international investment banks;
• provide the PZU Management Board with regular feedback concerning the perception of PZU among capital market players and broad knowledge of current and potential shareholders of the company;
• monitor investor sentiment towards PZU shares and changes in the shareholder structure in order to adopt the most adequate investor relations measures and tools;
• develop digital tools to address investor needs better, i.a. implement new solutions in the online annual report and enhance the functionality of the investor relations service;
• extend the scope of non-financial reporting.

⁵ Nationale-Nederlanden Open Pension Fund and Nationale Nederlanden Voluntary Pension Fund.
⁶ Current Report 21/2018
⁷ Shareholder structure survey by IPREO