Sagen MI Canada Inc · TSX:MIC.PR.A
Sagen MI Canada — Genworth MI Canada — Q4 2009 Earnings Presentation
21 slides from Sagen MI Canada's earnings presentation, Jan 29, 2010
Slide 1: Fourth Quarter and 2009 Financial Results
Fourth Quarter and 2009 Financial Results January 29, 2010
Slide 2: Agenda
Agenda • Business Strategy and Outlook • Financial Review • Operational Highlights • Question and Answer Session 1
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that relate to the Company’s current expectations and views of future events. These forward-looking statements may be identified by words or phrases such as “may”, “will”, “expect”, “anticipate”, “aim”, “estimate”, “int
Slide 4: Non-GAAP Measures
Non-GAAP Measures To supplement its financial statements, the Company uses select non-GAAP financial measures. Non- GAAP measures used by the Company to analyze performance include underwriting ratios such as loss ratio, expense ratio and combined ratio as well as other performance measures such as
Slide 5: Business Update
Business Update Brian Hurley, Chairman and CEO
Slide 6: Solid Fourth Quarter Performance
Solid Fourth Quarter Performance Strong Balance Sheet $5.2 Billion in Assets $2.6 Billion in Shareholders Equity Solid Operating Results Q4 09 2009 (1) Net Operating Income $85 MM $307 MM Operating EPS $0.72 $2.67 14% 13% ROE 1- Excluding earnings curve adjustment in Q109 5
Slide 7: Key Trends
Key Trends Improving Job Market Solid Housing Market Stable Market Conditions Low Interest Rates Strong Consumer Confidence 6
Slide 8: Business Overview
Business Overview Objectives Targets Grow Premiums Written Mid-teen ROEs Mitigate Losses & Manage Risks Deliver 5 – 10% Income Growth Enhance Portfolio Yield Efficient Capital Utilization Optimize Capital Structure 7
Slide 9: Capital Update
Capital Update Strong Capital Position For Business Solid Capital Ratios … 149% MCT Foundation During Economic Recovery Fuel Continued Core Growth Balancing Capital Strength And Efficiency Several Opportunities Under Review Critical Lever For ROE Enhancement Maintain Position While Evaluating Capita
Slide 10: Financial Highlights
Financial Highlights Philip Mayers, CFO
Slide 11: Financial Results Summary
Financial Results Summary $ MM (unless otherwise stated) Q3 09 Q4 09 2009 Net Premiums Written 104 110 360 (2) (1,2) Underwriting Income After Taxes 46 56 186 Investment Income After Taxes 29 29 121 (2) (1,2) Operating Net Income 75 85 307 (1) Operating EPS ($ Diluted) $0.63 $0.72 $2.67 Return on Op
Slide 12: % Earned by Year
Premiums Earned Premiums Single WrittenUpfront & EarnedPremium Earned Into Revenues Based on Loss Emergence Pattern % Earned by Year ’07 Book ’08 Book ’09 Book 0 1 2 3 4 5 6 7 8 9 10 $2 Billion of Unearned Premiums = Future Revenues 11
Slide 13: Combined Ratio
Combined Ratio 15% 15% 16% Expense Ratio 15% 42% 42% 39% Loss 31% Ratio '08 '09 Q3'09 Q4'09 Losses $160 $256 $64 * $60 Sequential Improvement In Fourth Quarter 12
Slide 14: Investment Portfolio
Investment Portfolio Portfolio Distribution Total: $5.0 Billion • Portfolio Duration of 3.1 Years Asset Backed & Other 6% 41% • Book Yield of 4.0% Corporates • $247 MM Invested in Q4 Provincials 13% Federal Government 20% • Invest in Sectors That Offer Cash 8% Attractive Risk / Reward Profile 12% Gu
Slide 15: Operational Highlights
Operational Highlights Peter Vukanovich, President and COO
Slide 16: Summary of Operational Highlights
Summary of Operational Highlights Enhanced Customer Service Has Improved Market Position Proactive Risk Management Contributed To Lower Losses Continued Positive Impact From Loss Mitigation Activities Extensive Collaboration With Federal Finance Department 15
Slide 17: Customer Sales and Service
Customer Sales and Service Q4 Highlights Results Faster Appraisal Process Turnaround Time Refined Underwriting Process Auto Decision Better Customer Communication Applications Extensive Education Making Progress With Key Lenders 16
Slide 18: Mortgage Portfolio Performance
Mortgage Portfolio Performance $224B Insurance in Force 12/31/09 Delinquency Rate 31-Jun-09 30-Sept-09 30-Dec-09 Ontario 48% 0.30% 0.25% 0.23% BC 16% 0.21% 0.23% 0.25% Alberta 15% 0.47% 0.50% 0.54% Quebec 14% 0.29% 0.29% 0.29% Other 7% 0.19% 0.19% 0.19% Total Delinquency 0.30% 0.28% 0.28% Delinquenc
Slide 19: Comprehensive Risk Management
Comprehensive Risk Management Key Initiatives Q4 Accomplishments Improved Risk Analytics Enhanced Property Valuations Homeownership Assisted 1400 Families Assistance Program Quality Assurance Real Time Feedback 18
Slide 20: 2010 View
2010 View Well Positioned For Continued Top Line Growth Seasoning 2007-2008 Book And An Improving Economy Strong Loss Mitigation Capabilities Target Higher Investment Yields Continue To Enhance Shareholder Value 19
Slide 21: Question and Answer Session
Question and Answer Session January 29, 2010 For further information: Samantha Cheung, VP Investor Relations 905-287-5482 samantha.cheung@genworth.com www.genworth.ca