Life Settlement Assets Plc · LSE:LSAA
Life Settlement Assets — Investor Presentation (June 2018)
26 slides from Life Settlement Assets's investor presentation, June 2018
Slide 1: Corporate Presentation June 2018
Corporate Presentation June 2018
Slide 2: Disclaimer
Disclaimer This document and the information contained herein have been prepared solely for the purpose of providing general information about Life Settlement Assets PLC (the "Company") and its operations. This document is not to be used for any other purpose and in particular does not purport to pr
Slide 3: An Introduction to LSA
An Introduction to LSA Our History Listed on the Specialist Fund Segment of the London Stock Exchange, LSA supports and and manages portfolios of whole and partial interests in life settlement policies issued by life insurance companies operating predominantly in the United States. The business was
Slide 4: Why Us?
Why Us? 3
Slide 5: Our Track Record
* Our Track Record 10 years of delivering strong returns to our clients • Highly experienced and prudent management team from the insurance, life settlements, actuarial and accounting sectors • Acheron utilises market data together with sophisticated actuarial software and analysis to deliver long t
Slide 6: Our Investment Policy
Our Investment Policy Our investment objective is to generate long-term returns for investors by investing in the life settlement market. We seek to achieve this through each of our separate Share Classes: Share Class B Share Class D & E Acquisitions Share Class A • Invested in life • Invested in se
Slide 7: Board of Directors
Board of Directors Jean Medernach, Chairman Franck Mathé Jean Medernach is an independent auditor licensed in Luxembourg and a Franck Mathé is a senior portfolio manager at EFFICAP in Paris. former US certified public accountant. Mr Medernach has more than 15 He holds a Doctor of Mathematics degree
Slide 8: Our Structure
Our Structure me LSA J@ Acheron CAPITAL LID AOrdinary B Ordinary D Ordinary E Ordinary Shareholders Shareholders: Shareholders Shareholders Life ak LSA Sse Ie Assets soeastvont | poomstuna | pwetnavaret | owanatvarer (attributable to the (ottributable to the (attributable to the (attributable to the
Slide 9: Our Investment Manager
Our Investment Manager Acheron is responsible for devising and modelling the investment strategy of the Company’s trusts. Founded in 2005 by Dr. Jean-Michel Paul, Acheron is a London based independent investment manager authorised and regulated by the FCA, that focuses on niche investment strategies
Slide 10: Performance Fees
Performance Fees Performance fees for Class A and B Performance fees for Share Class D and E • 25 per cent of the sum of the distributions made to the holders of the Ordinary • The performance fee in respect of each Trust shall be an amount equal Shares in excess of the Performance hurdle (assessed
Slide 11: About Life Settlements
About Life Settlements • A policy has positive net expected value to an investor if the expected discounted premiums to be paid and the purchase price of the policy is less than the value expected discount of the death benefit Life settlement profit An illustration of how profit is Cashflows $ gener
Slide 12: About Life Settlements: An evolving market
About Life Settlements An evolving market • Low correlation • Low correlation with traditional equity and fixed income markets, extending the efficient frontier • Returns from life settlements are mostly dependent upon mortality experience, which have remained stable in recent times • Low volatility
Slide 13: Share Class A Investment Case
Share Class A Investment Case Class ‘A’ invests in life insurance policies acquired from special or distressed situations, giving mixed exposure to HIV (average age mid to late 50s) and the elderly (average age mid to late 80s). Class A has exposure to fractional policies • Meaningful number of matu
Slide 14: Share Class A NAV Return and Collected Maturities
* Share Class A Collected Maturities US$ Predecessor Company Share Class A NAV Return 180 2012 16,263,308 170 2013 18,235,399 160 NAV Return rebased to 100 2014 23,940,072 150 2015 19,310,101 140 2016 18,316,544 130 2017 32,849,813 120 Total 128,915,237 110 Average 21,485,873 100 Dec-07 Dec-08 Dec-0
Slide 15: Share Class B Investment Case
Share Class B Investment Case Class ‘B’ invests in life insurance policies exposed to the elderly (average age mid to late 80s). Class B has exposure to fractional policies • Actuarial model forecasts material cash flow generation in the coming years due to the existing large policies • Expected opp
Slide 16: Share Class B NAV Return and Collected Maturities
* Share Class B Collected Maturities US$ Predecessor Company Share Class B NAV Return 160.00 2012 8,654,739 150.00 2013 3,783,849 NAV Return rebased to 100 2014 6,639,170 140.00 2015 2,010,520 130.00 2016 6,744,087 120.00 2017 7,305,068 110.00 Total 35,137,433 Average 5,856,239 100.00 Dec-07 Dec-08
Slide 17: Share Class D & E Investment Case
* * Share Class D & E Investment Case The assets attributable to the D and E Ordinary Share Classes are predominantly invested in separate portfolios comprising fractional policies with exposure to both HIV and elderly insureds, where the A and/or B Share Classes are already fractional owners Collec
Slide 18: Collected Maturities
Collected Maturities Class A Collected Maturities Class B Collected Maturities Class D Collected Maturities 2012 16,263,308 2012 8,654,739 2016 2,827,799 2013 18,235,399 2013 3,783,849 2017 8,284,827 2014 23,940,072 2014 6,639,170 Total 11,112,626 2015 19,310,101 2015 2,010,520 12,000,000 2016 18,31
Slide 19: Financial Results
* Financial Results Preliminary Results for the year ended 31 December 2017 Final Results for the year ended 31 December 2016 • Total maturities of US$ 52.9 million (FY2016: US$ 29.5 million) as a result of • Total maturities of US$ 29.5 million (2015: US$ 24.5 million), primarily as higher maturiti
Slide 20: Risk and risk management
Risk and risk management • Mortality risk: Changes in mortality rates may adversely affect the performance of the policies held by the Company in respect of a Share Class. • Premium management risk: Unanticipated volatility in mortality rates makes liquidity management of premium reserves difficult,
Slide 21: Risk and risk management
Risk and risk management • Discount rate risk: The discount rate used for reporting or valuation purposes may be on a portfolio basis or on a bottom up policy by policy or policy type by policy type basis, which can create material value differences. Further, there is no well-established market disc
Slide 22: Conclusion
Conclusion A unique, seasoned portfolio with leading Actual to Expected performance delivering long-term positive cash flow • Focused on maximising performance and distributing realised profit derived from its life settlement portfolio to its shareholders • Robust valuation model which has delivered
Slide 23: Appendix
Appendix 22
Slide 24: Glossary
Glossary Actual to Expected Ratio Actual death (either face amount or number of lives) in a group of lives being evaluated, over a specified period divided by the expected deaths over the same period. Actuary Actuaries measure and manage risk. Actuaries are knowledgeable in mathematics, statistics a
Slide 25: Glossary
Glossary Insured The individual(s) upon whose life is insured under a life insurance policy's contract. Upon the death of such individual(s), the net death benefit would be paid to the beneficiary. Life expectancy Life expectancy is an average number of years (or months) that a person is expected to
Slide 26: Glossary
Glossary Life Settlement A life settlement is the sale of a life insurance policy to a third party for a value in excess of the policy’s cash surrender value, but less than its face value, or death benefit. A policy owner receives a cash payment, while the investor acquiring the life insurance polic
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