Danish pension company AP Pension returned between 5 per cent and 10.3 per cent, before tax, on its investments in the first half of 2023, its half-year report has revealed.

Following a “difficult” 2022, the first six months of 2023 were more positive for AP Pension, which achieved a positive result of DKK 298m, after tax.

AP Pension customers in the AP Active product received returns of between 6.6 per cent (medium risk, five years to retirement) and 10.3 per cent (medium risk, 30 years to retirement).

Meanwhile, AP Sustainable customers received returns of between 5 per cent (medium risk, five years to retirement) and 7.3 per cent (medium risk, 30 years to retirement).

“The combination of a good investment result on equity, some one-off effects and a positive SUL result pulls the overall accounts into positive territory, and I am naturally happy about that,” said AP Pension CEO, Bo Normann Rasmussen.

“The positive SUL result of DKK 190m is, among other things, positively affected by updates in the calculation of the provisions, so I do not expect the same positive SUL result in the second half of the year, but we are following our plan to create balance in the SUL business, says the managing director.”

Rasmussen noted that, when the company had achieved positive returns in the first half of the year, it was due to, among other things, maintaining a certain level of risk in its investments at the start of 2023.

“It has also contributed positively to the return that we have a relatively large focus on quality shares with a strong business model and a leading market position,” he continued.

“That type of shares are slightly more expensive, but that particular style of shares has suited the current environment very well.

“The return in AP Sustainable is slightly lower in the first half of 2023, which primarily reflects the strict sustainability criteria, which excludes a number of large companies within media, communications, cyclical consumption and technology, which have given very high returns in the first half of the year.

“It is expected that there will be various fluctuations in the return over shorter periods, but over e.g. three years, there is no significant difference between the returns in AP Sustainable and AP Active.”

AP Pension customers’ current deposits rose by 2 per cent in H1 2023, while one-off premiums, which cover deposits and transfers, fell by around 7 per cent.

In total, AP Pension customers paid DKK 8.6bn in the first six months of 2023.

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