Corporate › Financial Unipol Group: draft financial statements and consolidated financial statements for 2018 approved

UNIPOL GROUP: DRAFT FINANCIAL STATEMENTS AND CONSOLIDATED FINANCIAL STATEMENTS FOR 2018 APPROVED

•  The preliminary results reported on 8 February last are confirmed.

•  Consolidated net profit of €628m (loss of €169m in 2017 due to the banking business restructuring plan)

•  Combined ratio after reinsurance 94.2% (96.4% in 2017)

•  Consolidated solvency ratio of 163%1 based on the partial internal model

•  Proposed dividend of €0.18 per share (dividend yield 4.5%2)

•  Shareholders' Meeting scheduled for 18 April 2019

•  Launch of the share repurchase programme for the compensation plans

Bologna, 15 March 2019

The Board of Directors of Unipol Gruppo S.p.A., which met yesterday under the chairmanship of Pierluigi Stefanini, approved the integrated consolidated financial statements and draft financial statements of Unipol Gruppo, confirming the preliminary results reported on 8 February last.

1 Figure calculated on the basis of the partial internal model to be considered as preliminary since the Supervisory Authority will be notified of the definitive results pursuant to the timescales provided under prevailing law.

2 Price at date of Board of Directors meeting of 7 February 2019.

The main consolidated results of the Unipol Group for 2018

•  Consolidated net profit of €628m, including the capital gain of €309m generated from the sale of UnipolSai Assicurazioni S.p.A.'s shareholding in Popolare Vita S.p.A. and the capital loss of €338m from the decision to sell the shareholding in Unipol Banca to BPER Banca. The Group had posted a loss of €169m in 2017 due to the financial effects of the banking business restructuring plan that amounted to €824m after taxes. Without considering the effects of the above‐mentioned non‐recurring components for the two periods in question and re‐calculating the consolidated results on a comparable basis, consolidated net profit for 2018 stood at €645m compared to €598m in 2017.

•  Direct insurance income, including reinsurance ceded, at €12,349m (+0.5% compared to €12,291m in 2017).

  •  Non‐Life business: €7,953m (+1.1% compared to 2017)

  •  Life business: €4,292m on a comparable basis3 (+15.4% compared to 2017 on a comparable basis3)

•  Combined ratio after reinsurance 94.2% (96.4% in 2017)

•  Direct business combined ratio 94.4% (95.1% in 2017)

•  Banking Business

  • o Coverage of non‐performing loans:

    • o 72% for the bad loans

    • o 46% for the unlikely‐to‐pay exposures

  • o UnipolReC ended 2018 with a net profit of €6.9m. The gross non‐performing loan portfolio fell by €311m (10% of stock) against collections of €95m with a recovery ratio of 31%.

•  Return on financial investments of 3.8%

•  Total equity of €6,327m (€7,453m in 2017), of which €5,032 attributable to the Group

•  Consolidated solvency ratio of 163%1 based on the partial internal model (compared to 166% as at 31 December 2017)

3 The figures provided on a comparable basis for both periods were calculated excluding the amounts contributed by Popolare Vita and The Lawrence Life.

Accounting profit and dividends

Unipol Gruppo ended 2018 with an accounting profit of €66.2m. On the basis of this result, the Board of Directors also decided to submit the proposal to the Shareholders' Meeting to distribute a dividend of €0.18 per ordinary share for 2018 in accordance with the articles of association.

If the Shareholders' Meeting scheduled for 18 April 2019 approves the dividend, it will be payable from 22 May 2019, with the ex‐dividend date from 20 May 2019, and a record date of 21 May 2019. The full text of the proposed resolutions and reports by the Board of Directors relating to the items on the agenda and all related documentation will be available, as provided by law, at the registered office and on the Company websitewww.unipol.it (Governance/General Meetings section) and on the website of the Italian Stock Exchangewww.borsaitaliana.it.

****

Launch of the treasury share purchase programmes for the compensation plans based on financial instruments approved by Unipol Gruppo and certain subsidiaries

In accordance with article 144‐bis of CONSOB Issuers' Regulation, article 5 of Regulation (EU) no. 596/2014 and article 2 of Delegated Regulation (EU) 2016/1052, starting from today's date, the purchase programmes (individually the "Programme" and together the "Programmes") for treasury shares (the "Shares") of Unipol Gruppo S.p.A. ("Unipol") will commence, by Unipol and the following directly or indirectly controlled companies: Alfaevolution Technology S.p.A., Arca Vita S.p.A., Gruppo Una S.p.A., Finitalia S.p.A., Leithà S.r.l., SIAT S.p.A., UnipolSai S.p.A., UnipolSai Servizi Consortili S.c.r.l. and UniSalute S.p.A. (the "Subsidiaries").

The purchases will be for a maximum number of 1,265,200 Shares (amounting to about 0,176% of the share capital of Unipol), as set out in more detail below, to be used to implement the compensation plans based on performance share type financial instruments, approved by the respective Shareholders' Meetings of the Shareholders of Unipol and the Subsidiaries for the years 2016‐2018, with the first tranche of Shares to be allotted to the Managers of Unipol and the Subsidiaries on 30 April next.

Unipol

The Unipol Programme ‐ applicable to the authorisation for the purchase of treasury shares issued in accordance with article 2357 and 2357‐ter of the Civil Code and other applicable provisions of the law and regulations, by the Shareholders' Meeting of 24 April 2018, for a maximum period of 18 months and a maximum expenditure limit of €200m ‐ is to purchase a maximum number of 762,000 Shares.

Subsidiaries

The Subsidiaries' Programmes ‐ applicable to the Share purchase authorisations of the parent company, issued as from 23 April 2018, in accordance with article 2359‐bis of the Civil Code andother applicable provisions of the law and regulations, by the respective Shareholders' Meetings, for a maximum period of 18 months and a total maximum expenditure of €51,344,500 ‐ are to purchase a maximum number of 503,200 Shares.

All the purchases will be made through one or more transactions on the regulated market, in accordance with the procedures established for those types of transactions in the market organisation and management regulations, for a maximum unit price calculated by taking the official closing share price of the stock in the trading session prior to each individual transaction, with a mark‐up of no higher than 15%.

The Share purchase transactions implementing the Programmes will also be carried out in accordance with the provisions of articles 132 of the Consolidated Law on Finance, 144‐bis, first paragraph, letter b) of the CONSOB Issuers' Regulation, and in accordance with the terms set out under articles 5 of Regulation (EU) 596/2014 and 3 of Delegated Regulation (EU) 2016/1052.

As of today's date, Unipol holds a total of 2,003,299 in ordinary treasury shares (equal to about 0.279% of the share capital), of which 747,799 indirectly through the subsidiaries UnipolSai S.p.A. (1,189,999), Compagnia Assicuratrice Linear S.p.A. (14,743), Arca Assicurazioni S.p.A. (18,566), SIAT S.p.A. (19,576) and Finitalia S.p.A. (12,616).

****

In order to provide more complete disclosure of the 2018 result, please find attached hereto the Consolidated Balance Sheet, the Consolidated Income Statement, the Statement of Comprehensive Income, the summary of the Consolidated Income Statement by Business Segment and the Balance Sheet by Business Segment, and the Balance Sheet and Income Statement of Unipol Gruppo S.p.A.

Finally, by today's date, the Integrated Consolidated Financial Statements for 2018 will be made available to the public at the registered office of the company on the authorised storage mechanism eMarket Storage (www.emarketstorage.com), and on the Company's website www.unipol.it (Governance/Shareholders' Meetings/2019/Ordinary and extraordinary shareholders' meeting of 18 April 2019 section), not including the reports by the auditing firm and the Board of Statutory Auditors, that will be published subsequently in accordance with the law as indicated in the notice calling the meeting.

****

Maurizio Castellina, Manager in charge of financial reporting of Unipol Gruppo S.p.A. and UnipolSai Assicurazioni S.p.A. declares, pursuant to Article 154‐bis, paragraph 2, of the Consolidated Law on Finance, that the accounting information contained herein corresponds to the corporate documentation, ledgers and accounting records.

Glossary

DIRECT BUSINESS COMBINED RATIO: indicator that measures the balance of Non-Life direct technical management, represented by the sum of the loss ratio (ratio between direct claims for the period + other technical charges and direct premiums earned) and the expense ratio (ratio between operating expenses and direct premiums recognised).

COMBINED RATIO AFTER REINSURANCE: indicator that measures the balance of Non-Life total technical management, represented by the sum of the loss ratio (ratio between claims for the period + other technical charges and premiums earned) and the expense ratio (ratio between operating expenses and premiums earned).

Unipol Gruppo S.p.A.

Unipol is one of the main insurance groups in Europe with total premiums of approximately €12.2bn, of which €8.0bn in Non‐Life and €4.3bn in Life (2018 figures). Unipol adopts an integrated offer strategy and covers the entire range of insurance and financial products, operating primarily through the subsidiary UnipolSai Assicurazioni S.p.A., founded at the start of 2014 and a leader in Italy in the Non‐Life Business, particularly MV TPL. The Group is also active in direct MV insurance (Linear Assicurazioni), transport and aviation insurance (Siat), health insurance (UniSalute) and supplementary pensions, and maintains a presence in the bancassurance channel. Lastly, it also operates in the banking realm through the network of Unipol Banca branches, and manages significant diversified assets in the real estate, hotel and agricultural (Tenute del Cerro) sectors. Unipol Gruppo S.p.A. is listed on the Italian Stock Exchange.