Pelagos Insurance Capital Limited · NYSE:PLGO
Pelagos Insurance Capital — Fidelis Insurance Holdings — Q2 2024 Earnings Presentation
28 slides from Pelagos Insurance Capital's earnings presentation, Aug 14, 2024
Slide 1: Investor Presentation Fidelis Insurance Group
June 30, 2024 Investor Presentation Fidelis Insurance Group
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements This document (including the documents incorporated herein) contains, and our officers and representatives may from time to time make (including on our related conference call), "forward-looking statements" which include all statements that do not
Slide 3: Highlights: Fidelis Insurance Group at a Glance
Highlights A leading global specialty insurer, leveraging strategic partnerships to offer innovative and tailored insurance solutions 3 Note: 1) Results as at June 30, 2024, and market data per S&P Capital IQ as of August 13, 2024. Annual yield is the annualized Q2 2024 dividend divided by $17.61, t
Slide 4: Building on a Strong Foundation for Scale and Profitable Growth
5.7% 18.8% 12.0% 13 – 15% 2020-2022 Avg. 2023 Q1 2024 Annualized Long-Term Target Operating RoAE Operating RoAE(4) (3) Building on a Strong Foundation for Scale and Profitable Growth 4 GPW Growth Q2 2024 YTD YoY Growth of 22.9% ($bn) Note: Peer set includes Beazley (“BEZ”), Lancashire (“LRE”), Condu
Slide 5: Long-Term Shareholder Value Creation Framework
Long-Term Shareholder Value Creation Framework 5 Capital Management 13-15%(1) Long-Term Target Underwriting Profitability Investment Returns Mid to High 80s%(1) Long-Term Target Combined Ratio ■ Allocating capital into attractive underwriting opportunities ■ Constantly reassessing our outwards reins
Slide 6: Why Invest in Fidelis Insurance Group
Why Invest in Fidelis Insurance Group 6 High quality book of specialty insurance business that creates long-term value by delivering returns to shareholders Note: 1) This slide contains forward looking statements covered by the PSLRA. See Safe Harbor Statement on Slide 2. High quality, mature, and w
Slide 7: A Mature and Well-Positioned Portfolio
Property Reinsurance 18% Other Bespoke 7% Credit & Political Risk 12% Specialty Other 2% Property 5%Energy 5% Aviation & Aerospace 8% Marine 18% Property D&F 24% $4.1 Billion A Mature and Well-Positioned Portfolio Gross Premiums Written (for the 12 months ended June 30, 2024) SPECIALTY $2,540m (62%)
Slide 8: Driving Strong Premium and BVPS Growth
GPW ($bn) Book Value Per Diluted Common Share $16.24 $21.71 YE 2022 Q2 2024 $3.0 FY 2022 TTM Q2 2024 +37% +34% 8 Note: 1) Gross Premiums Written trailing twelve months (“TTM”) as June 30, 2024. 2) As of the Separation Transactions on January 3, 2023. (2)(1) Driving Strong Premium and BVPS Growth (As
Slide 9: Key metrics versus peer average
44.5% 31.9% FIHL Peer Average 38.9% 22.1% FIHL Peer Average 85.8% 100.2% Fidelis Peer Average 9 Source: Company financials. Note: 1) Key metrics include GPW CAGR, NPE CAGR, and Average Combined Ratio for 2018 through 2023; Peer set includes Beazley (“BEZ”), Lancashire (“LRE”), Conduit (“CRE”), Hamil
Slide 10: Delivering Market-leading Combined Ratios vs. Peers
60.1% 64.7% 55.3% 62.7% 38.1% 61.8% 32.9% 35.4% 36.6% 33.4% 44.0% 32.0% 93.0% 100.1% 91.9% 96.1% 82.1% 93.8% Combined Ratio (2021-2023) 10 Note: 1) Peer average for 2021 and 2022 is calculated from peer group including Beazley (“BEZ”), Lancashire (“LRE”), Conduit (“CRE”), Hamilton (“HG”), Everest (“
Slide 11: 2024 Second Quarter Highlights
Key Q2 YTD Takeaways 2024 Second Quarter Highlights 11 Note: 1) Operating RoAE is a non-US GAAP financial measure and is calculated as operating net income divided by adjusted average common shareholders’ equity. See Important Notice and Appendix for reconciliation. 2) Operating EPS is a non-US GAAP
Slide 12: 2024 Second Quarter Highlights by Segment
2024 Second Quarter Highlights by Segment 12 Specialty 63.4% $657.3 $756.5 Q2 2023 Q2 2024 Bespoke 7.6% $54.7 $90.6 Q2 2023 Q2 2024 Reinsurance 29.0% $245.2 $346.1 Q2 2023 Q2 2024 Note: 1) The Fidelis Partnership fees are not allocated to the segment level and policy acquisition costs as presented i
Slide 13: Fixed Income Portfolio and Asset Allocation
Fixed Income Portfolio Credit QualityAsset Allocation 1% Other Investments 45% Corporates(1) 18% US Treasuries 6% Agency MBS(2) <1% BB 11% BBB 40% A 38% AA 11% AAA 13 2.7yrs Duration $3.5bn Fixed Income Portfolio ~89% Rated A- or Better AA- Weighted-Average Credit Quality $4.4bn Total Cash and Inves
Slide 14: Strong Liquidity and Disciplined Capital Allocation
Strong Liquidity and Disciplined Capital AllocationCapital Strength and Balance Sheet Scale 14 ■ Committed to proactively managing and allocating capital to maintain financial strength and drive profitable underwriting ■ Total long-term debt and preference securities of $507 million, resulting in a
Slide 15: Reserving Framework and Favorable Prior Year Development
Reserve release Favorable Prior Year Development ($m) We employ a robust reserving methodology and set our reserves on a consistent basis over time Reserving Framework • Employ a robust reserve methodology and take a consistent approach to reserving over time • Avoid systematic and excessive over or
Slide 16: Underwriting Platform Facilitates Reliable Access to Attractive Risk
Underwriting Platform Facilitates Reliable Access to Attractive Risk 16 Rolling 10-year agreement ensures long-term continuity and access to underwriting by The Fidelis Partnership Long-term strategic partnership with The Fidelis Partnership creates significant benefits FIHL’s Chief Underwriting Off
Slide 17: Management team
Allan Decleir Group CFO & Director 35+ Years of Experience Hannah Greenwood Chief of Staff 10+ Years of Experience • Platinum Underwriters • EY • Ardonagh Group • Ed • Lloyd’s Dan Burrows Group CEO & Director 35+ Years of Experience Denise Brown-Branch Group COO 25+ Years of Experience Warrick Beave
Slide 18: Strong Foundation for Profitable Growth
Strong Foundation for Profitable Growth 18 Note: 1) This slide contains forward looking statements covered by the PSLRA. See Safe Harbor Statement on Slide 2.. Leading combined ratio compared to peers and efficient capital deployment Diversified book of business driving consistent, long-term profita
Slide 19: Appendix
FIDELIS | INSURANCE GROUP Appendix L
Slide 20: Q2 2024 Financial Highlights
Q2 2024 Financial Highlights
Slide 21: Specialty Overview
Underwriting RatioGross Premiums Written Specialty Overview 21 ■ Portfolio of tailored risks across traditional specialty business lines including Aviation and Aerospace, Energy, Marine, Property and Property Direct & Facultative (“Property D&F”) ■ ‘Hard’ market conditions following years of compoun
Slide 22: Bespoke Overview
Segment Highlights Underwriting RatioGross Premiums Written Bespoke Overview 22 ■ Focused on highly tailored, innovative and specialized products, where the buying motivation is often driven by regulatory capital relief, capital efficiency or transaction facilitation versus more traditional drivers
Slide 23: Reinsurance Overview
Reinsurance Overview 23 ■ Focused on a strategically selected property catastrophe book, optimized to reflect our view of risk allowing Fidelis Insurance Group to manage exposures and minimize volatility ■ Capacity deployed opportunistically on core clients at targeted attachment points and focus on
Slide 24: Additional Partnership Details
Additional Partnership Details
Slide 25: Framework Agreement with The Fidelis Partnership
Framework Agreement with The Fidelis Partnership 25 Termination provisions Include underwriting performance thresholds, termination rights under fraud, insolvency and material breach of contract conditions and provisions for regulatory issue or rating downgrades FIHL agrees Annual Plan with TFP Sets
Slide 26: Non-GAAP Financial Measures Reconciliation
Non-GAAP Financial Measures Reconciliation 26
Slide 27: Non-GAAP financial measures definitions and reconciliation
This Presentation includes certain financial measures that are not calculated in accordance with generally accepted accounting principles in the U.S. (“GAAP”) including operating net income, operating EPS, operating return on average common equity, and therefore are non-U.S. GAAP financial measures.
Slide 28: Fidelis Group
FIDELIS | GROUP
Fidelis Insurance Holdings — Q2 2024 Earnings Presentation on 6ix