Årsrapport 2022 godkendt 7. marts 2023 (eng) - Flipbook - Side 9
INDUSTRIENS PENSIONSFORSIKRING A/S ANNUAL REPORT 2022
Investment activities
Return for the year
The result on investment activities was a loss of
DKK -15.0 bn. after costs and before tax in 2022.
This corresponds to a total investment return for
the year of -6.5%.
2022 was a challenging year for investments.
Growth continued after the Covid-19 pandemic,
but the relatively unrestrained monetary and
economic policy of previous years, combined
with increasing energy prices due to the war in
Ukraine, led to drastically increasing inflation.
Danish shares were -10.6%, while foreign shares
saw returns of -17.0%.
Investment-grade bonds (DKK 7 bn.) were
negatively affected by interest-rate increases,
particularly in the USA, and they returned -16.9%.
High-yield bonds (DKK 9 bn.) were also
negatively affected by extended credit spreads
and yielded a return of -12.2%, while the return
from emerging-markets bonds (DKK 20 bn.) was
-14.2% due to interest-rate increases in the US,
as a large proportion of the bonds were issued
in USD.
INVESTMENT ACTIVITIES
similar benchmarks, returns earned are applied.
For unlisted investments, a number of other
references are used to assess the returns on the
individual classes of assets.
The return for the year is 0.4 percentage points
below the benchmark. This is primarily
attributable to the gilt-edged bonds portfolio,
which included a high proportion of Danish
mortgage-credit bonds that were particularly
affected by interest-rate increases because
foreign, in particular Japanese, investors sold
out of their portfolios.
Infrastructure stands out
The total portfolio of unlisted investments
amounts to DKK 82 bn. Investments are in
unlisted companies, infrastructure assets,
property and loans. Most is invested in unlisted
companies (DKK 32 bn.) and infrastructure
assets (DKK 25 bn.).
Table 7
The majority of the unlisted investments are
through funds and co-investments with these.
However, investments in Danish properties are
direct investments. The same applies for longterm investments in a number of infrastructure
assets with stable and predictable cash flows.
Investments of this type are made with local
partners.
The return on investments in unlisted companies
(private equity), was clearly affected by the
negative trend on the listed shares and the year
ended with a return of -4.5%.
Due to the strong underlying economies in the
US and Europe, the buy-out market yielded a
positive return in 2022, while the venture
market, which is dominated by start-ups and
small companies within IT and the healthcare
sector in particular, yielded a negative return.
Returns on assets 2022
Both equities and bonds fell
Inflation caused central banks to increase
interest rates for the first time in many years to
combat the inflationary pressure, and this led to
large negative returns on bonds. At the same
time, tighter liquidity and concerns for recession
in the wake of increasing interest rates meant
that share prices also saw particularly high falls,
especially high-value technology shares with the
earnings prospects unlikely until further into the
future. For this reason, in 2022, the usual
beneficial effects of having both shares and
bonds in the portfolio, whereby a fall in share
prices is often compensated for by stable or
increasing bonds prices, did not apply.
On the listed share markets, in which Industriens
Pension has invested DKK 54 bn., returns on
Gilt-edged bonds (DKK 29 bn.), including in
particular
mortgage-credit
bonds,
were
impacted hard by interest-rate increases, and
yielded a return of -12.9%.
Gilt-edged bonds
Other credit
Return (%)
Benchmark
-12.9
-11.6
2.0
2.0
Strategic hedging of the interest-rate and
inflation risk had a positive impact on returns for
the year due to expectations of higher inflation
and interest rates in Europe. Hedging meant that
the negative returns on bonds were partially
mitigated by the hedging contribution of 2.7
percentage points in terms of the total returns
for the year.
Corporate bonds, high yield
-12.2
-12.9
Bonds, emerging markets
-14.2
-13.8
Bonds, investment grade
-16.9
-16.4
Shares, Danish
-10.6
-12.1
Shares, foreign
-17.0
-16.7
Unlisted shares
-4.5
-4.5
Properties
-6.9
-6.9
Relevant benchmarks are used for listed assets,
and these are stated in the table. With regard to
unlisted investments, for which there are no
Infrastructure
17.9
17.9
Total
-6.0
-5.5
Total, including hedging of liabilities
-6.5
-6.1
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