James River Group Holdings, Inc. · NASDAQ:JRVR
James River — Q3 2022 Earnings Presentation
25 slides from James River's earnings presentation, Nov 2, 2022
Slide 1: Investor Presentation Third Quarter 2022
Investor Presentation Third Quarter 2022
Slide 2: Disclosure: Forward-Looking Statements
Disclosure Forward-Looking Statements This presentation contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, should, int
Slide 3: Executive Summary
Executive Summary
Slide 4: Overview of James River
Overview of James River We seek to deliver a consistent, top tier return on tangible common equity and generate sector leading value creation for shareholders ✓ Unique franchise predominantly focused on the Excess and Surplus lines market and fronting and program business ✓ Target low volatility cas
Slide 5: Our Business
Our Business • We are a specialty, low volatility underwriting company with an attractive, sizeable Excess & Surplus (“E&S”) franchise and scaling “capital light” fronting business experiencing an extremely robust market for property and casualty risk. • Little catastrophe or cyber underwriting expo
Slide 6: Attractive Growth Businesses
Attractive Growth Businesses • Attractive E&S market poised for expected continued profitable growth as industry competitors retrench, and new businesses are forced to find insurance coverage in the E&S market given their lack of insurance loss history. • Our primary businesses (Core E&S(1) and Spec
Slide 7: What is Driving Growth in the E&S Market?
What is Driving Growth in the E&S Market? The E&S market began experiencing rate hardening in late 2018 / early 2019 and the hardening significantly accelerated in 2020 driven by the Global Pandemic. Admitted market carriers have been tightening underwriting guidelines or non-renewing business, push
Slide 8: The E&S Market is Highly Attractive
The E&S Market is Highly Attractive U.S. Excess & Surplus Lines DWP ($BN) E&S industry DWP has grown at double digit rates the past 4 years driven by rising renewal rates and changes in risk appetite $62.9 2012 – 2017 Average Growth Rate: 5% $47.6 $40.3 $34.6 $29.8 $29.9 $31.5 $27.3 $28.9 $25.4 2012
Slide 9: E&S: Broad Risk Appetite Permits Us to 'Pick Our Spots'
E&S: Broad Risk Appetite Permits Us to ‘Pick Our Spots’ Our high caliber underwriting team, and use of technology, provide significant expertise to price our flow of skillfully underwritten risks • 13 separate underwriting divisions focused on growth in very attractive markets. • Renewal rates incre
Slide 10: Finding Profitable Growth Opportunities
Finding Profitable Growth Opportunities Attractive underwriting conditions have allowed for meaningful growth in our Core E&S book at highly profitable margins Achieving meaningful scale at highly attractive rates – disciplined Highly profitable Core E&S underwriting margins, poised to benefit under
Slide 11: Specialty Admitted: Growth With Limited Risk Retention
Specialty Admitted: Growth With Limited Risk Retention Fronting business continues to experience meaningful growth as recently added programs mature and expand • Capital light, deal-driven business with limited risk retention. • Lower risk fee-income business complements our highly profitable Core E
Slide 12: We Represent a Unique Investment Opportunity
We Represent a Unique Investment Opportunity 2022 YTD Cat Losses % of Loss Ratio (1) Our focus on low volatility, niche casualty E&S business and prudent reinsurance purchasing results in little catastrophe exposure, differentiating us from specialty peers 5.3% 4.5% 2.5% 2.6% 1.3% 0.9% 0.0% 2021 E&S
Slide 13: Capital Position
Capital Position Our balance sheet enables us to continue to capitalize on an extremely attractive P&C market Balance Sheet as of: Commentary 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 Assets • Completed issuance of Series A preferred Total Invested Assets $2,061.4 $2,130.5 $2,125.0 $2,038.0 $2,176.0 s
Slide 14: Investment Portfolio
Investment Portfolio The Company holds a conservative portfolio given its focus on underwriting risk Investment Portfolio as of September 30, 2022 Commentary • Balanced portfolio focused on high quality fixed maturities, Total Cash and Investments (excluding restricted cash): $2,364 MM with small al
Slide 15: Key Investment Highlights
Key Investment Highlights Proven market leader with focus on the small and middle market; LargeMarket and Expanding Leading E&S Carrier one of the highest E&S concentrations with minimal property Addressable Market catastrophe exposure Capitalizing onAddressable a ‘once in a Robust E&S market poised
Slide 16: Appendix: 3Q 2022 Earnings
Appendix: 3Q 2022 Earnings
Slide 17: Consolidated Performance
Consolidated Performance $ in millions, except per share figures % Commentary 3Q21 3Q22 Change Key Income Statement Items • Gross written premium increased 3% due primarily Gross Written Premium $346.6 $358.5 3% to an increase in Casualty Re and Specialty Net Written Premium 158.2 190.3 20% Admitted
Slide 18: E&S Segment Performance
E&S Segment Performance $ in millions % Commentary 3Q21 3Q22 Change Key Segment Results • Gross written premium declined 6% from the prior Gross Written Premium $217.7 $204.8 (6)% year quarter, primarily due to discrete actions and Net Written Premium 127.9 141.0 10% pricing strategies impacting sel
Slide 19: Specialty Admitted Segment Performance
Specialty Admitted Segment Performance $ in millions % Commentary 3Q21 3Q22 Change Key Segment Results • Gross written premium increased 2%, reflecting Gross Written Premium $121.2 $123.4 2% an 8% reduction in individual risk workers’ Net Written Premium 22.6 18.9 (16)% compensation and 3% growth in
Slide 20: Casualty Reinsurance Segment Performance
Casualty Reinsurance Segment Performance $ in millions % Commentary 3Q21 3Q22 Change Key Segment Results • Gross written premium increased significantly Gross Written Premium $7.8 $30.3 291% compared to the prior year quarter primarily Net Written Premium 7.8 30.3 291% driven by premium adjustments
Slide 21: Appendix: Underwriting Performance Ratios & Non-GAAP Reconciliation
Appendix: Underwriting Performance Ratios & Non-GAAP Reconciliation
Slide 22: Underwriting Performance Ratios
Underwriting Performance Ratios Underwriting Performance Ratios 3Q21 3Q22 9M21 9M22 Excess and Surplus Lines Loss Ratio 97.9% 69.3% 122.0% 66.2% Impact of Retroactive Reinsurance 0.0% 14.9% 0.0% 5.1% Loss Ratio Including Impact of Retroactive Reinsurance 97.9% 84.2% 122.0% 71.3% Combined Ratio 118.0
Slide 23: Non-GAAP Measures Reconciliation
Non-GAAP Measures Reconciliation 12 Months Ended Dec 31, Underwriting Profit (Loss) 2019 2020 2021 3Q21 3Q22 Underwriting Profit (Loss) of The Operating Segments: Excess and Surplus Lines $19.2 $9.8 ($121.5) ($21.5) $16.4 Specialty Admitted Insurance 5.9 4.2 9.7 3.1 0.3 Casualty Reinsurance (7.2) (1
Slide 24: Non-GAAP Measures Reconciliation
Non-GAAP Measures Reconciliation 12 Months Ended Dec 31, Tangible Equity & Tangible Common Equity 2019 2020 2021 3Q21 3Q22 Shareholders’ Equity $778.6 $795.6 $725.4 $813.6 $526.8 Plus: Series A Redeemable Preferred Shares - - - - 144.9 Plus: Deferred Reinsurance Gain - - - - 20.8 Less: Goodwill and
Slide 25: InvestorRelations@jrgh.net
InvestorRelations@jrgh.net
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