Intact Financial Corporation · TSX:IFC
Intact Financial — Q2 2013 Earnings Presentation
19 slides from Intact Financial's earnings presentation, Jul 31, 2013
Slide 1: Intact Financial Corporation: Review of performance Q2-2013
Intact Financial Corporation (TSX: IFC) Continuing our journey to build a world-class P&C insurer Review of performance Q2-2013 Wednesday, July 31st, 2013
Slide 2: Charles Brindamour, Chief Executive Officer
Charles Brindamour Chief Executive Officer
Slide 3: Q2-2013 key points
Q2-2013 key points Highlights • Net operating income per share of $0.89, despite a $0.79 per share impact related to the Alberta storms and flooding • Combined ratio of 97.5% with solid underlying results in our auto businesses • Premium growth of 10%, bolstered by the addition of Jevco’s product su
Slide 4: Personal property improvement plan – next wave
Personal property improvement plan – next wave Reported Combined Ratio 109.0% 96.5% 103.5% 93.5% 103.3% 8.6% 13.3% 12.3% 5.9% 10.3% CAT CR excl. CAT and PYD 101.2% 94.6% 93.6% 89.2% 96.6% PYD -0.8% -4.0% -3.4% -6.0% -5.6% FY2009 FY2010 FY2011 FY2012 H1-13 Immediate actions Actions before year-end •
Slide 5: The personal auto environment
The personal auto environment • Recent Ontario budget included a strategy to reduce both rates and costs − Reduce insurance rates by an average of 15% over a period of time − Budget provides momentum on formalizing cost containment measures discussed to date − We believe the outcome could be margin-
Slide 6: Canadian P&C industry 12-month outlook
Canadian P&C industry 12-month outlook We remain well-positioned to continue outperforming the Canadian P&C insurance industry in the current environment • Industry premium growth is likely to evolve at a similar pace to that of the last 12 months. • Potential for increased government intervention i
Slide 7: Summary and key takeaways
Summary and key takeaways • We have a sustainable competitive advantage versus the industry due to our disciplined approach and quality operations – We generated a combined ratio of 97.5% despite unprecedented flooding in Southern Alberta – Our 3,000 claims professionals have been crucial in allowin
Slide 8: Mark Tullis, Chief Financial Officer
Mark Tullis Chief Financial Officer
Slide 9: Q2-2013 Financial highlights
Q2-2013 Financial highlights (in $ millions, except as otherwise noted) Q2-2013 Q2-2012 Change YTD-2013 YTD-2012 Change Direct premiums written 2,182 1,977 10% 3,706 3,380 10% Net underwriting income 42 123 (66)% 125 246 (49)% Combined ratio 97.5% 92.3% 5.2 pts 96.3% 92.3% 4.0 pts Net operating inco
Slide 10: Personal lines
Personal lines (in $ millions, except as otherwise noted) Q2-2013 Q2-2012 Change Combined Ratio Breakdown Personal Auto Direct premiums written 1,037 907 14% 25.8% 27.7% Expense Underwriting income 106 82 29% Ratio 61.4% 61.3% Claims Combined ratio 87.2% 89.0% (1.8) pts Ratio Q2-2013 Q2-2012 • Stron
Slide 11: Commercial lines
Commercial lines (in $ millions, except as otherwise noted) Q2-2013 Q2-2012 Change Combined Ratio Breakdown Commercial Auto Direct premiums written 186 159 17% 29.4% Expense 32.8% Underwriting income 16 26 (38)% Ratio 60.2% 46.8% Claims Combined ratio 89.6% 79.6% 10.0 pts Ratio Q2-2013 Q2-2012 • DPW
Slide 12: High quality investment portfolio
High quality investment portfolio Net investment gains $12.3 billion – conservatively managed (in $ millions, except as otherwise noted) Note: Investment mix is net of hedging positions and financial liabilities related to investments. Q2-2013 Q2-2012 Change Fixed income securities Cash and short te
Slide 13: Financial position remains solid
Financial position remains solid • Our financial position remains solid with $486 million in excess capital • MCT change from 214% to 197% was primarily due to: • Elevated catastrophe losses (-7%) • Share repurchases (-5%) • Net impact from higher rates and lower equity markets (-3%) • Book value pe
Slide 14: Integrations are on track
Integrations are on track AXA Canada Jevco • Integration of AXA Canada continues to • Continuing to convert policies into IFC progress very well systems • Conversion is on track and are focused • Retention has been good and we are on decommissioning the AXA systems working to re-underwrite portions
Slide 15: Strategic, operational and financial strength
Strategic, operational and financial strength • Largest P&C insurance provider in Canada • Solid financial position • Excellent long-term earnings power • Organic growth platforms easily expandable Our solid financial position and disciplined approach to the business provide a strong foundation from
Slide 16: Q3-2013 earnings call
Q3-2013 earnings call Wednesday, November 6th, 2013
Slide 17: Investor Relations contact information
Investor Relations contact information Dennis Westfall, CFA Maida Sit, CFA Vice President, Investor Relations Manager, Investor Relations Phone: 416.341.1464 ext 45122 Phone: 416.341.1464 ext 45153 Cell: 416.797.7828 Email: Maida.Sit@intact.net Email: Dennis.Westfall@intact.net General Contact Info
Slide 18: Forward looking statements and disclaimer
Forward looking statements and disclaimer Certain of the statements included in this presentation about the Company’s current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-l
Slide 19: Forward looking statements and disclaimer
Forward looking statements and disclaimer Disclaimer This Presentation does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall it or any part of it form the basis of or be relied on in connection with, or act as any inducem