Taaleri: Improving underlying performance - Nordea

Taaleri reported Q3 EBIT of EUR 18.5m, coming clearly below Refinitiv consensus at EUR 14.0m. Based on segment reporting, Q3 total income was EUR 26.9m, 6% above Nordea estimate of EUR 25.3m. Recurring revenues were EUR 10.5m in Q3, beating our estimate by 5%. Fair value changes of investments were EUR -3.5m in Q3, while we had anticipated EUR +1.5m. Investment operations income of EUR 9.9m came clearly below our estimate of EUR 15.3m. Taaleri recorder EUR 14m total income from exit of Ficolo. As the company recorded EUR 6.5m carry in Q3 (we did not anticipate any carry), private asset management EBIT beat our estimates clearly. When adjusting for carry, private assets management EBIT was EUR -0.2m versus our EUR -0.6m estimate. Private asset management recurring revenues came 9% above our estimate. Hence, underlying operations have performed well in Q3. Garantia’s loan losses continued at a low level (2.7%) while net premiums increased by 15% y/y, while we had anticipated 14% growth. Combined ratio was strong at 29.0% in Q3 and beat our estimate of 30.9%. Solvency was up at 245.5%. Private asset management AuM was up 4% q/q to EUR 2.5bn (EUR 2.2bn in 2021). The launch of SolarWind III was announced yesterday on 3 November and the company aims to reach first closing early 2023 with target of EUR 700m of commitments. On initial take, we expect consensus to make slightly positive underlying estimate revision. We have a fair value range of EUR 11.1-12.5 per Taaleri share