James River Group Holdings, Inc. · NASDAQ:JRVR
James River — Q3 2021 Earnings Presentation
22 slides from James River's earnings presentation, Nov 15, 2021
Slide 1: Investor Presentation Third Quarter 2021
Investor Presentation Third Quarter 2021
Slide 2: Disclosure: Forward-Looking Statements
Disclosure Forward - Looking Statements This presentation contains forward - looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 . In some cases, such forward - looking statements may be identified by terms such as believe, expect, seek, may, will, shou
Slide 3: Executive Summary
Executive Summary
Slide 4: Overview of James River
4 Overview of James River x Renew our unrelenting focus on underwriting profitability x Generate superior underwriting margins from our niche casualty focused risk, while growing both non - risk bearing fee income and investment income x Continue to focus on the small and middle market, where we hav
Slide 5: Our Business
5 Our Business E&S Segment Specialty Admitted Segment Casualty Reinsurance Segment • Focus is on small and medium sized commercial account E&S casualty business; generally $1.0M per occurrence limits; ~$24,000 avg. premium per account • Significant strength in current market environment • “Core E&S”
Slide 6: Attractive Growth Businesses
$189.9 $218.1 $234.9 $260.8 $282.2 $334.4 $516.8 $669.1 $20.6 $59.4 $91.0 $182.2 $316.4 $374.3 $387.6 $408.7 2013 2014 2015 2016 2017 2018 2019 2020 Core E&S Specialty Admitted Commercial Auto Casualty Re 6 Attractive Growth Businesses • Attractive E&S market poised for continued profitable growth a
Slide 7: What is Driving Growth in the E&S Market?
7 What is Driving Growth in the E&S Market? The E&S market began experiencing rate hardening in late 2018 / early 2019 and the hardening significantly accelerated in 2020 driven by the Global Pandemic. Admitted market casualty pricing has not been keeping up with loss cost inflation for years. Admit
Slide 8: The E&S Market is Highly Attractive
$23.0 $25.4 $27.3 $28.9 $29.8 $29.9 $31.5 $34.6 $40.3 $47.6 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 8 73% 88% 71% 75% 74% 83% 100% 94% 87% 95% 108% 103% 96% 97% 98% 101% 104% 99% 99% 99% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 E&S Industry Combined Ratio P&C Industry Combined Rat
Slide 9: E&S: Broad Risk Appetite Permits Us to 'Pick Our Spots'
E&S: Broad Risk Appetite Permits Us to ‘Pick Our Spots’ 9 $ in millions (1) A large commercial auto account in runoff represents the bulk of our commercial auto gross written premiums through 2019. Non e o f the remaining commercial auto business we write after 2019 is exposed to the ride share sect
Slide 10: Specialty Admitted: Growth in Process Fronted Programs
Specialty Admitted: Growth in Process 10 Fronted Programs GWP ($M) Fee Income ($M) • Fronting business continues to experience meaningful growth as recently added programs mature and expand • Six new programs added since Q3 2020 will continue to ramp into 2022 • Capital light, deal - driven business
Slide 11: We Represent a Unique Investment Opportunity
0% 26% 30% 31% 34% 59% 100% 0% 1% 2% 3% 4% 6% 8% 11 We Represent a Unique Investment Opportunity 2021 Cat Losses % of Loss Ratio (1) 2020 E&S DWP as a % of total GWP (2) Our focus on low volatility, niche casualty E&S business and prudent reinsurance purchasing results in little catastrophe exposure
Slide 12: Balance Sheet Summary
Q4 2020 Q1 2021 Q2 2021 Q3 2021 Assets Total Invested Assets $2,197.1 $2,159.0 $2,202.3 $2,061.4 Cash and Cash Equivalents 162.3 183.5 360.9 220.6 Goodwill and Intangible Assets 218.2 218.1 218.1 218.0 Total Assets 5,063.1 5,109.7 5,391.8 4,784.1 Liabilities and Shareholders' Equity Reserve for Loss
Slide 13: Investment Portfolio Commentary
Investment Portfolio Commentary • Balanced portfolio focused on high quality fixed maturities, with small allocation to unique strategies to enhance returns • Investment income increased 2% during 3Q21 from the prior year quarter due to contributions from renewable energy and other private investmen
Slide 14: Appendix: Q3 2021 Earnings
Appendix: Q3 2021 Earnings
Slide 15: Consolidated Performance Commentary
15 Consolidated Performance Commentary • 11% overall gross written premium growth, with increases in E&S and Specialty Admitted partially offset by a decline in Casualty Re • Net written and net earned premium growth was 9% and 12%, respectively, but was negatively impacted by $8M of reinstatement p
Slide 16: E&S Segment Performance Commentary
16 E&S Segment Performance Commentary • 21% gross written premium growth, including 18% in Core E&S • Net written and net earned premium growth was 17% and 14%, respectively, but was negatively impacted by $8M of reinstatement premiums in E&S o Adjusting for reinstatement premiums, overall net writt
Slide 17: Specialty Admitted Segment Performance Commentary
17 Specialty Admitted Segment Performance Commentary • 8% gross written premium growth, including 12% in Fronting and Programs driven by new programs • Strong Fronting and Programs pipeline remains intact • Individual risk workers’ compensation gross written premium declined 16% compared to the prio
Slide 18: Casualty Reinsurance Segment Performance Commentary
18 Casualty Reinsurance Segment Performance Commentary • Gross written premiums declined 61% compared to the prior year quarter due to a change in renewal period for one treaty and negative written premium adjustments on prior year treaties • Premium base is expected to be meaningfully downsized fur
Slide 19: Appendix: Non-GAAP Reconciliation
Appendix: Non - GAAP Reconciliation
Slide 20: Underwriting Profit (Loss)
Underwriting Profit (Loss) YTD Q3 YTD Q3 2017 2020 2020 2021 Underwriting profit (loss) of the operating segments: Excess and Surplus Lines $29.7 $42.8 $19.2 $9.8 $39.8 ($145.6) Specialty Admitted Insurance 3.2 7.0 5.9 4.2 2.3 6.5 Casualty Reinsurance (1.8) 5.1 (7.2) (18.4) (3.1) (16.9) Total underw
Slide 21: Adjusted Net Operating Income and Tangible Equity
YTD Q3 YTD Q3 Adj. Net Operating Income (Loss) 2017 2018 2019 2020 2020 2021 Income (loss) as reported $43.6 $63.8 $38.3 $4.8 $25.1 ($106.5) Net realized inv. (gains) losses 1.4 4.4 3.8 14.8 23.6 (11.9) Dividend withholding taxes 1.1 - - - - - Other expenses 0.6 1.1 0.8 1.6 1.5 1.6 Interest expense
Slide 22: InvestorRelations@jrgh.net
InvestorRelations@jrgh.net
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