Axis Capital Holdings Limited · NYSE:AXS
Axis Capital — Wachovia Nantucket Equity Conference 2008
21 slides from Axis Capital's conference presentation, Jun 25, 2008
Slide 1: AXIS Capital – Wachovia Nantucket Equity Conference 2008
Exhibit 99.1 AXIS Capital Wachovia Nantucket Equity Conference 2008 David Greenfield, CFO June 25, 2008
Slide 2: Safe Harbor Disclosure
Safe Harbor Disclosure Cautionary Statement Regarding Forward-looking Statements Statements in this presentation that are not historical facts, including statements regarding our estimates, beliefs, expectations, intentions, strategies or projections, may be “forward-looking statements” within the m
Slide 3: Investment Highlights
Investment Highlights Well-diversified leader in the global wholesale P&C markets Established global insurance and reinsurance platforms Well-diversified mix of specialty and niche businesses Geographic diversification globally Disciplined and proven underwriter Proven steward of capital (generated
Slide 4: Global Specialty Insurer and Reinsurer
Global Specialty Insurer and Reinsurer Well-positioned to navigate all phases of (re)insurance cycle with established presence in both insurance and reinsurance markets globally GPW by Segment Gross Premiums Written 2002 - 2007 2007 GPW = $3,590 M ($ in millions) $4,000 $3,609 $3,590 $3,394 $3,012 $
Slide 5: Diversified Strategic Footprint
Diversified Strategic Footprint Selective diversification by product and geography with well-timed entry 2002 2003 2004 2005 2006 2007 2008 $1.1Bn $2.3Bn $3.0Bn $3.4Bn $3.6Bn $3.6Bn Bermuda U.S. excess & European Entry into Australia London- surplus lines professional media liability branch market l
Slide 6: Quality, Sustainability and Profitability
Quality, Sustainability and Profitability Combined Ratio 101.8% 100% 84.4% 77.3% 75.3% AVERAGE= 75% 70.4% 73.6% 80.5% 80.3% 61.4% 52.9% 50% 42.7% 51.1% 50.1% 25% 27.7% 22.5% 23.0% 24.4% 25.2% 21.5% 0% 2002 2003 2004 2005 2006 2007 Total Expense Ratio Loss Ratio Net Income Return on Average Common Eq
Slide 7: Q1 2008 Results
Q1 2008 Results ($ in millions) Consolidated AXIS Re AXIS Insurance Gross Premiums Written Gross Premiums Written Gross Premiums Written (0.0%) $1,500.0 $1,000.0 (4.3%) $500.0 (3.0%) $1,400.0 $750.0 $1,300.0 $500.0 $250.0 $866 $829 $436 $435 $1,200.0 $1,303 $250.0 $1,264 $1,100.0 $0.0 $0.0 Q1 2007 Q
Slide 8: AXIS Insurance – Strategic Global Presence
AXIS Insurance – Strategic Global Presence North America • Nationwide network of 10 offices in U.S. • Office in Toronto • Flexibility to write on admitted Europe and non-admitted basis in all 50 • London and Dublin states • Surplus-lines eligible in 43 states • Top 15 E&S carrier in the U.S. • Freed
Slide 9: AXIS Insurance Overview
AXIS Insurance Overview Product lines coordinated on a 2007 GPW by Line of Business Total GPW = $2,039 M global basis Specialty Lines division – Other 1% both traditional P&C and Liability 12% specialty insurance products Property 32% Professional Lines division – Professional D&O, E&O and other pro
Slide 10: AXIS Insurance Premium Since Inception
AXIS Insurance Premium Since Inception ($ in millions) Focus on underwriting profitability $2,070 $2,039 2,100 $1,920 $1,875 1,800 $1,607 1,500 93% 1,200 81% 72% 900 69% $794 68% 62% 600 300 0 2002 2003 2004 2005 2006 2007 Property Marine Casualty Terrorism Aviation & Political Aerospace Risk Profes
Slide 11: AXIS Re Overview
AXIS Re Overview Established presence in New York, 2007 GPW by Line of Business Bermuda, Zurich and Singapore Total GPW = $1,551 M Global catastrophe reinsurance Other 7% portfolio complemented by: Liability 16% Catastrophe 30% Targeted activity in specialist U.S. casualty reinsurance and Motor 6% B
Slide 12: AXIS Re Premium Since Inception
AXIS Re Premium Since Inception ($ in millions) Focus on underwriting profitability 1,800 $1,519 (1) $1,539 $1,551 1,500 106% $1,093 1,200 85% 78% 76% 900 $667 66% 62% 600 $314 300 0 2002 2003 2004 2005 2006 2007 Catastrophe Property Professional Lines Credit & Bond Motor Liability Other Combined Ra
Slide 13: Risk Management Strategies
Risk Management Strategies Selective Diversification Defined Tolerance Levels • Properly considered and controlled medium • Maximum limits and risk tolerances for and long-term strategy potential shock losses • Minimizes reliance on external protection • Limit overall exposure to long-tail business
Slide 14: Strong Risk Management
Strong Risk Management Strong risk management has driven outstanding risk-return profile 20% 18% AXIS Company L 2.06 Company H 0.97 16% Company A 1.31 2.17 Company E 14% 1.49 Company I Company B 0.97 12% 1.89 Company C Company G Company D 1.33 Company F 0.98 2.02 10% 0.94 Company J 8% 0.72 6% Compan
Slide 15: Strong Balance Sheet
Strong Balance Sheet ($ millions) March 31, December 31, 2008 2007 2006 2005 Total Cash and Invested Assets $10,655 $10,311 $9,653 $7,703 Premiums Receivable 1,608 1,231 1,126 1,027 Reinsurance Recoverable 1,426 1,357 1,359 1,518 Other Assets 1,952 1,776 1,528 1,678 Total Assets $15,640 $14,675 $13,
Slide 16: Favorable Reserve Development since Inception
Favorable Reserve Development since Inception We mitigate reserve risk by limiting overall exposure to long-tail business, integrating third-party actuarial input into our prudent reserving practices and by utilizing institutional knowledge from participation in both insurance and reinsurance market
Slide 17: Strong Net Reserve Position
Strong Net Reserve Position ($ in millions) Net Case Reserves Net IBNR Reserve $1,200 $1,028 $804 $827 $800 $574 $662 $611 $443 $556 $375 $400 $599 $538 $454 $316 $361 $271 $59 $63 $73 $0 Property and Liability Professional Cat, Property & Credit & Bond, Professional Other Lines other Motor & Liabil
Slide 18: Conservative Investment Portfolio
Conservative Investment Portfolio Total Cash & Investments $10.7 Bn U.S. Treasury/Agency Other Investments Managers have a total return 6% 12% mandate Corporate Debt Cash & Equivalents 21% Emphasis on capital 15% preservation Short duration customized fixed Municipals/Non- U.S. income benchmarks Gov
Slide 19: Investment Income Momentum
Investment Income Momentum Growth in investment income driven by strong operating cash flows and growth in invested assets $600.0 $10.0 Other Investments Fixed Income $$ $482.9 Cash $500.0 LTM Net Investment Income $443.2 $8.0 $407.1 $400.0 $6.0 $256.7 $300.0 $4.0 $152.1 $200.0 $2.0 $100.0 $0.0 $0.0
Slide 20: Modest Financial Leverage = Financial Flexibility
Modest Financial Leverage = Financial Flexibility ($ in millions) Capitalization Ratios Debt / Total Capital 8.5% Debt + Preferred / Total Capital 17.0% $5,871 $6,000 $5,658 499 $4,912 499 250 $5,000 250 250 250 499 $4,011 250 $3,737 $4,000 250 499 499 250 $2,817 250 $3,000 $1,961 4,659 4,871 $2,000
Slide 21: Driving Shareholder Value Creation
Driving Shareholder Value Creation 2002 – Q1 08 Average ROACE = 18.0% Diluted book value per share plus accumulated dividends have grown at an annualized rate of 17.7% from 2002 through March 31, 2008 Diluted book value per share + Accumulated dividends $35.00 $32.68 ’02-Q1 08 CAGR = $31.14 17.7% $2
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