Tiptree Inc. · NASDAQ:TIPT
Tiptree — CFA Society New York Insurance Conference 2020
24 slides from Tiptree's conference presentation, Nov 10, 2020
Slide 1: CFA Society New York Insurance Conference
CFA Society New York Insurance Conference November 2020
Slide 2: Disclaimers
Disclaimers LIMITATIONS ON THE USE OF INFORMATION This presentation has been prepared by Tiptree Inc. and its consolidated subsidiaries (“Tiptree", "the Company" or "we”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree, its s
Slide 3: Tiptree Overview
Tiptree Overview ($ in millions) Our Approach Value Focus on Oriented Profitable Financials Investment Underwriting Insurance Insurance Warranty Approach U.S. Europe Solutions Real Assets Think Like Patient Capital Owners Partner (30.8% insider ownership1) Capital allocation and investment managemen
Slide 4: Insurance Company Overview
01 Insurance Company Overview
Slide 5: Fortegra Overview
Fortegra Overview ($ in millions) Business overview Written premiums & premium equivalents1 Program underwriter and administrator of specialty insurance and related consumer products ◼ Diversified revenue sources including underwriting, fee and investment income $1,536 ◼ Nationwide presence with exp
Slide 6: Largest Insurance and Fee-Based Programs
Largest Insurance and Fee-Based Programs Premiums & Equivalents1 Distribution Channels Products and services distributed primarily through: Warranty ◼ Independent agents ◼ Installment Lenders Solutions ◼ MGUs ◼ Auto Dealerships Insurance 35% ◼ Retail Agents ◼ Third-party administrators U.S. 62% Q3’2
Slide 7: Strong and Consistent Underwriting Track Record
Strong and Consistent Underwriting Track Record ($ in millions) Combined ratio1 | vs. peers Highlights 97.6% ◼ Consistent loss ratio is a function of product mix, alignment of interests and limited CAT exposure 92.9% 92.5% 92.6% 91.8% ◼ Combined ratio performance driven by efficiency through technol
Slide 8: Building on the Fortegra Foundation
Building on the Fortegra Foundation ($ in millions) 1981 - 2015 - 2019+ 2014 2018 ▪ Fortegra founded as a provider ▪ Fortegra acquired by Tiptree ▪ Global expansion with launch of monoline credit insurance of Fortegra Europe ▪ A.M. Best “A-” rating (Excellent) ▪ Expanded underwriting and ▪ Acquisiti
Slide 9: Growing Unearned Premiums and Deferred Revenues
Growing Unearned Premiums and Deferred Revenues ($ in millions) UEPR & Deferred Revenues by product Highlights Credit ◼ ~27% compounded growth rate from 2016 reflecting Warranty Light Commercial continued volume growth in single premium multi-year $1,151 programs such as credit insurance and warrant
Slide 10: Investment Portfolio
Investment Portfolio ($ in millions) $611 Fixed Income Diversification $514 84 Fixed Income ETFs - BBB and below - 1% 11% Cash & Equivalents - 19% $438 75 61 Other A - 12% • $527 million, AA rating investments • ~1.7 year duration $527m AA - 12% • $360 million Blackrock Managed 527 Fixed Income & Ca
Slide 11: Opportunities to drive long-term value
Opportunities to drive long-term value ($ in millions) Growth Opportunities + Fundamental principles ◼ Light commercial admitted programs and ◼ Consistent balance between risk-based E & S lines within the U.S. and fee-based revenue ◼ Warranty solutions in U.S. with a primary ◼ Maintain a combined ra
Slide 12: Tiptree Capital Overview
01 02 Tiptree Capital Overview
Slide 13: Tiptree Capital Overview
Tiptree Capital Overview ($ in millions) Overview Invested Capital1 Operating EBITDA1 ◼ Acquire or invest in diverse companies outside the insurance $199 industry with our balance sheet capital $182 $44 $149 7 49 74 ◼ Invest in businesses that meet the following criteria: ✓ Strong and experienced ma
Slide 14: Summary: Financials & Looking ahead
01 SUMMARY 03 Financials & Looking ahead
Slide 15: Tiptree Financial Performance
Tiptree Financial Performance ($ in millions) Operating EBITDA1 Insurance Premiums & Equivalents2 Insurance – U.S. Insurance – Europe Warranty Solutions $1,176 $465 $937 $372 437 174 $90.8 $787 256 $295 117 172 35 $59.2 14 24 64 2 277 657 704 253 615 Q3'19 LTM Q3'20 LTM 231 Corporate $(19.8) $(22.1)
Slide 16: Well Positioned to Deliver on Long-Term Objectives
Well Positioned to Deliver on Long-Term Objectives ($ in millions) Operating EBITDA1 Grow insurance business ✓ Grow written premiums while maintaining underwriting standards ✓ Successfully launch and grow specialty E&S lines $90.8 ✓ Integrate and grow warranty businesses $63.6 ✓ Expand Internation
Slide 17: Appendix
Appendix 04 Non-GAAP Reconciliations • Operating EBITDA • Book Value per share • Invested and Total Capital • Insurance Underwriting Margin • Insurance Combined Ratio • Insurance Net Investments & Net Portfolio Income
Slide 18: Non-GAAP Reconciliations
Non-GAAP Reconciliations Operating EBITDA Management uses Operating EBITDA and book value per share as measurements of operating performance which are non-GAAP measures. Management believes the use of Operating EBITDA provides supplemental information useful to investors as it is frequently used by
Slide 19: Non-GAAP Reconciliations – Operating EBITDA
Non-GAAP Reconciliations – Operating EBITDA ($ in millions) Year Ended December 31, Q3'20 LTM 2019 2018 2017 2016 2015 (1) Corporate Debt interest expense includes Secured corporate credit agreements, junior subordinated notes and preferred trust securities. Interest expense associated with asset- N
Slide 20: Non-GAAP Reconciliations – Operating EBITDA
Non-GAAP Reconciliations – Operating EBITDA ($ in millions) Twelve Months Ended September 30, 2020 Year Ended December 31, 2019 Year Ended December 31, 2018 Tiptree Tiptree Corporate Tiptree Tiptree Corporate Tiptree Tiptree Corporate Insurance Capital Expenses Total Insurance Capital Expenses Total
Slide 21: Non-GAAP Reconciliations – BVPS, Invested Capital, Total Capital
Non-GAAP Reconciliations – BVPS, Invested Capital, Total Capital ($ in millions) As of December 31, Management uses Book value per share, which is a non-GAAP financial measure. Management believes the use of this Q3'20 2019 2018 2017 2016 2015 financial measure provides supplemental information usef
Slide 22: Non-GAAP Reconciliations – Combined Ratio, Underwriting Revenues & Margin
Non-GAAP Reconciliations – Combined Ratio, Underwriting Revenues & Margin ($ in millions) Year Ended December 31, The following table provides a reconciliation between underwriting margin and pre-tax income. We Revenues: Q3'20 LTM 2019 2018 2017 2016 2015 generally limit the underwriting risk we ass
Slide 23: Tiptree Capital – Realized Investment IRR %
Tiptree Capital – Realized Investment IRR % ($ in millions) Invested Realized Category Investments Capital Investment MOIC IRR % Financials Realized: MFCA, Telos, PFG, Siena, CLO sub-notes, hedges $ 305.0 $ 598.0 2.0x 25.6% Unrealized: Reliance, Luxury, credit investment 47.5 - - - Real Assets Reali
Slide 24: TiptreeInc.
TiptreeInc.
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