UNIQA warns of pain now for gain later

UNIQA, Austria’s
second-largest insurer, has bold long-term growth plans but they
will not come without initial financial pain.

The composite insurer has
warned investors that to cover restructuring costs a one-time
provision of about €170m ($240m) is to be incurred in the fourth
quarter of 2011 and will result in its net profit for the full year
being a “flat zero.”

Of the provision, €80m is in
respect of costs involved in the retrenchment of some 600 staff –
7% of the insurer’s total – over the next three years.

Retrenchment will start with
200 (20%) of head office staff complement within the next 12
months. UNIQA stated that a further €80m will be to “cushion all
planned personnel measures in the coming years” and €30m will be
used to provide additional funding of the group pension
scheme.

Among targets which the
insurer has set itself is to increase net profit to €400 million by
2015, up from €153m in 2010, and to virtually double the number of
clients to 15 million in 2020.

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