Intact Financial Corporation · TSX:IFC
Intact Financial — ING Canada — Q3 2006 Earnings Presentation
16 slides from Intact Financial's earnings presentation, Nov 9, 2006
Slide 1: 2006 Third Quarter Financial and Operating Results
ingcanada.com ingcanada.com 2006 Third Quarter Financial and Operating Results November 9, 2006 P. 1
Slide 2: Forward-Looking Statement Disclaimer
ingcanada.com Forward-Looking Statement Disclaimer Certain of the statements contained in this presentation about our 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 3: Presenters
ingcanada.com Claude Dussault, President & CEO Mark Tullis, Senior Vice-President & CFO Charles Brindamour, Executive Vice-President P. 3
Slide 4: Q3 2006 Highlights
ingcanada.com Q3 2006 Highlights Continued strong financial results vs outstanding Q3 05 performance Net income of $156.8 million (down 22.7% from Q3 05) Earnings per share of $1.17 (vs $1.52 in Q3 05) Return on equity, for the last 12 months of 24.6% Combined ratio of 89.9% Debt to total
Slide 5: Earnings Reconciliation – Pre-tax
ingcanada.com Earnings Reconciliation – Pre-tax ($ millions) Q3 05 Pre-tax income $269.4 Prior year claims development (24.5) Current accident year* 0.3 Facility Association residual market (4.9) Catastrophes 8.3 Underwriting income (20.8) Realized investment and other gains (31.0) Other 1.1 Q3 06 P
Slide 6: Direct Premiums Written
ingcanada.com Direct Premiums Written ($ millions) $3,905 $4,000 $3,576 $3,444 $3,107 $3,000 $2,192 $2,000 + 3.1% $1,007 $1,038 $1,000 $0 2001 2002 2003 2004 Q3/05 2005 Q3/06 Excluding the AGR business and lower premiums from pools, YoY growth was 4.9% driven by a 4% increase in written insured risk
Slide 7: Net Premiums Earned
ingcanada.com Net Premiums Earned ($ millions) $4,000 $3,840 $3,365 $3,000 $2,761 $2,337 $2,019 $2,000 0% $955 $955 $1,000 $0 2001 2002 2003 2004 Q3/05 2005 Q3/06 NPE flat YoY due primarily to average rate decreases of 2.7% and lower pool premiums. P. 7
Slide 8: Combined Ratio
ingcanada.com Combined Ratio 120% Claims ratio Expense ratio 102.7% 101.2% 98.1% 100% 86.0% 87.7% 86.0% 89.9% 29.0% 27.4% 80% 30.0% 28.9% 29.5% 29.4% 29.7% 60% 40% 73.7% 73.8% 68.1% 56.6% 58.8% 56.3% 60.4% 20% 0% 2001 2002 2003 2004 Q3/05 2005 Q3/06 Continued strong combined ratio despite less favou
Slide 9: Investment Yields
ingcanada.com 1) Investment Yields 10% 8% 6.5% 6.0% 5.9% 2) 6% 5.3% 5.1% 4.8% 4.9% 4% 2% 0% 3) 2001 2002 2003 2004 Q3/05 2005 Q3/06 Yields reflect low interest rates during the quarter. 1) Pre-tax, at book value, for P&C insurance subsidiaries excluding realized gains and losses 2) Calculation based
Slide 10: Realized Investment and Other Gains
ingcanada.com 1) Realized Investment and Other Gains ($ millions) $250 $223.5 $200 $150 $132.4 $100 $66.8 $50 $34.2 $32.1 $35.8 $2.5 $0 2001 2002 2003 2004 Q3/05 2005 Q3/06 Gains driven primarily by equities. 1) Pre-tax P. 10
Slide 11: Net Income
ingcanada.com Net Income ($ millions) $781.8 $800 $700 $624.2 $600 $500 $400 -22.7% $300 $202.8 $200 $150.5 $156.8 $100 $0 2003 2004 Q3/05 2005 Q3/06 While YoY comparisons are difficult given outstanding results in 2005, current earnings remain solid driven by continued favourable claims experience
Slide 12: Return On Equity
ingcanada.com 1) Return On Equity 50% 40.9% 40% 36.5% 31.6% 30% 24.6% 20% 16.5% 10% 0% 2003 2004 Q3/05 2005 Q3/06 Strong returns generated on a rapidly increasing equity base. 1) Last twelve months P. 12
Slide 13: Debt to Total Capital Ratio
ingcanada.com Debt to Total Capital Ratio 50% 40% 37.5% 32.8% 30.5% 30% 20% 11.1% 10% 4.5% 4.2% 0.0% 0% 2001 2002 2003 2004 Q3/05 2005 Q3/06 Remaining debt repaid in full during the quarter. P. 13
Slide 14: Questions and Answers
ingcanada.com Questions and Answers P. 14
Slide 15: Questions and Answers
ingcanada.com Questions and Answers Question 1: Did cats in the quarter mostly impact personal property? Can you provide a breakdown by line of business? Answer: Yes, personal property was impacted the most. The impact by line of business was as follows: ($ millions) Personal property $19.0 Personal
Slide 16: Q4 06 Earnings Conference Call
ingcanada.com ingcanada.com Coming Thursday, February 15, 2007 at 10:00 a.m. Q4 06 Earnings Conference Call P. 16