EuroBusiness Media (EBM): Groupama is presenting its Strategic Plan for 2010-2012. Jean Azéma, welcome. You’re the CEO of Groupama. Groupama is coming to the end of the Strategic Plan it announced three years ago. Before we talk about the future, what’s your assessment of the years 2007-2009 and of the Group’s development over this period?
Jean Azéma (JA): There are three major lessons we can draw from this 2007-2009 period for Groupama. First, accelerating growth. Second, the Group has become much more international. And third, we’ve improved our profitability. Let’s just take a look at the figures. We had announced revenue growth of 7% per annum from a combination of organic growth and growth through acquisitions, and we have achieved this target. Our turnover will top €17 billion by the end of the year. In terms of profitability, we had set ourselves the goal of multiplying the Group’s operating profit by three. We outperformed this goal in 2008 and will do so again in 2009, taking the storms into account. And the third objective was to have a combined ratio of between 98 and 102: we’ll actually be below 100 in 2009.
EBM: You’re announcing a new plan for the next three years. Can you explain the objectives and main lines of this plan?
JA: The Group’s goal for the 2010-2012 period is to sustain our current strategy, based on growth. We therefore also aim to improve profitability by achieving a turnover growth rate of 6% per annum, outperforming the market. We should reach €20 billion of revenues at the end of fiscal year 2012. We stand by our combined ratio objective of between 98 and 102, and we expect this plan to increase our profitability to 10% annual revenue growth.
EBM: We’re in a crisis environment, where things have changed quite dramatically, but you’re saying you’re standing by the same strategy. Can you explain this paradox?
JA: I don’t think there’s a paradox. The Board of Directors did indeed raise the question of whether the crisis had changed the Group’s strategy. Should it change the Group’s strategy? The various factors that had led us to adopt this strategy, namely, the emergence of a European insurance market, consolidation with larger and larger insurance operators, are still at work. Size remains of fundamental importance in the European market, particularly as it is made up of private individuals, craftsmen, small retailers and small and medium-sized companies. So the Board confirmed this strategy. However, to put it simply, when you hit stormy or bad weather you reef in the sails a little, and that’s exactly what we did in 2009. We didn’t stop making investments in the business, but simply refrained from making new acquisitions.
EBM: The plan you’ve announced won’t put you in the top 10 European insurance companies. Can you tell us about your plans for growth through acquisitions?
JA: You’re right, the plan will generate revenues worth €20 billion, which isn’t enough to put us in the top 10 European insurers, the goal set by the Board of Directors. We’ll therefore have to complement the plan by making more acquisitions. These could be either medium-sized acquisitions or, more likely, a large restructuring deal sizeable enough to justify financing by an increase in the group’s capital.
EBM: Jean Azéma, CEO of Groupama, thank you.
JA: Thank you.
