Conduit Holdings Ltd. · LSE:CRE
Conduit — H1 2023 Earnings Presentation
21 slides from Conduit's earnings presentation, Jul 26, 2023
Slide 1: Conduit Holdings Limited H1 2023 results
Conduit Holdings Limited H1 2023 results 26 July 2023
Slide 2: Market environment remains among the best in decades
Market environment remains among the best in decades The market environment is the hardest it has been in a generation with reinsurer economics benefitting from strong pricing, favourable terms and conditions and higher attachment points We see a number of factors combining to maintain the curre
Slide 3: Excellent premium growth and strong profitability in H1 2023
Excellent premium growth and strong profitability in H1 2023 Gross premiums written of $542.2 million, +52.9% over the same period in 2022 Discounted combined ratio of 72.5% compared with 99.9% for the first six months of 2022 Comprehensive income of $78.6 million and RoE of 9.1% Interim div
Slide 4: Strong premium trajectory and solid profitability in H1 2023
Strong premium trajectory and solid profitability in H1 2023 Gross premiums written1), $m Combined ratio2) Comprehensive income3), $m 622.4 127.2% 119.4% 542.2 103.0% 78.6 99.9% 378.8 72.5% 354.5 209.8 -12.4 -42.0 -43.9 -39.4 FY'21 FY'22 H1'21 H1'22 H1'23 FY'21 FY'22 H1'21 H1'22 H1'23 FY'21 FY'22 H1
Slide 5: Over $1.5 billion gross premiums written since inception
Over $1.5 billion gross premiums written since inception Cumulative gross premiums written1), $m 1,537 257 218 507 164 431 148 123 366 310 98 241 773 66 189 624 51 129 465 37 77 423 364 44 261 129 157 177 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Property Casualty Specialty 1) Gros
Slide 6: Strong growth continues into H1 2023
Strong growth continues into H1 2023 Estimated ultimate premiums written1), $m 762 Specialty Increasing number of opportunities from broader cross 645 152 class insurers 103 XL vs QS markets presenting disparate risk metrics 492 452 238 Casualty 92 71 234 Large new deal flow, exhibiting very d
Slide 7: Exceptional market conditions continue
Exceptional market conditions continue Risk-adjusted rate change, net of inflation1) 39% Property Casualty Specialty Weighted 30% 19% 15% 14% 12% 8% 8% 7% 7% 5% 4% 4% 4% 3% 2% 2% 2% 2% 1% 1% 1% 1% 0% 2022 Q1 2022 Q2 2022 Q3 2022 Q4 2023 Q1 2023 Q2 Enduring pricing environment creating the opportun
Slide 8: Updated natural catastrophe exposures
Updated natural catastrophe exposures 2022 plan 2023 plan Revised 2023 plan Net PMLs1) $m % TNAV2) $m % TNAV2) $m % TNAV2) 1:100 54 5.5% 65 7.5% 85 9.8% 1:250 75 7.6% 99 11.4% 100 11.6% We have benefited from exceptional market conditions and have been able to selectively grow our exposure. We w
Slide 9: A quick reminder about the impact of IFRS 17 on Conduit
A quick reminder about the impact of IFRS 17 on Conduit IFRS 17 is an accounting change and does not impact our underwriting strategy or the underlying No impact to economics strategy and reserving approach Our reserving approach is unchanged but will include more granular disclosures surroundin
Slide 10: First half of 2023, financial highlights
First half of 2023, financial highlights H1 2023 H1 2022 Change % Strong growth driven by continued positive rate Key financials ($m) increases, outpacing inflation Gross premiums written 542.2 354.5 52.9% Reinsurance revenue 278.7 169.3 64.6% Despite an active natural catastrophe H1 2023 of Net
Slide 11: High quality investment portfolio
High quality investment portfolio Asset allocation as at 30 June 2023 Credit quality as at 30 June 2023 U.S. Agency MBS/CMBS, 10% BBB U.S. Municipal Bonds 9% and Non U.S. Govt Bonds/Agencies, 1% Corporate Bonds, 34% Non-Agency Structured Products, 18% Portfolio Duration: A 2.4 years AAA 23% Average
Slide 12: Strong interim results. Hard market. Excellent prospects
Strong interim results. Hard market. Excellent prospects Solid comprehensive income for the first six months of 2023, with interim dividend payment covered 2.6 times Business model remains on strong growth trajectory, prioritising on the most attractive business lines, with solid pipeline of pre
Slide 13: Appendices
APPENDICES We CONDUIT RE 13
Slide 14: Downward trend of Conduit's combined ratio
Downward trend of Conduit’s combined ratio1) 109.3% 103.0% 105.8% 99.9% Unwavering focus on underwriting 6.0% 8.6% 6.9% profitability manifests in H1 2023, 8.0% 83.1% where the maturity of the portfolio and 72.5% operations start to emerge 5.7% 127.2% 9.3% 119.4% Continued downward movement of 8
Slide 15: Evolution of Conduit employee base
Evolution of Conduit employee base 2021 FY 2022 FY 2023 H1 Total employees1) 41 54 56 As of 30 June 2023: Female-male: 50-50 70% of the Bermuda-based employees do not require work permits 1) All employees are based in Bermuda except the Executive Chairman and Head of IR & Marketing, who are base
Slide 16: H1 2022 comparatives – Income statement
H1 2022 comparatives – Income statement IFRS 4 2022 2022 IFRS 17 $m $m Gross premium written 359.0 169.3 Reinsurance revenue Ceded premium written (45.6) (149.8) Reinsurance service expenses Net premium written 313.4 Change in gross UEPR (125.6) (20.4) Ceded reinsurance expense Change in ceded UEPR
Slide 17: H1 2022 comparatives – Balance sheet
H1 2022 comparatives – Balance sheet IFRS 4 2022 2022 IFRS 17 $m $m Cash and cash equivalents 92.0 92.0 Cash and cash equivalents Accrued interest 4.0 4.0 Accrued interest Investments 952.7 952.7 Investments Inwards premium receivable 288.7 - Reinsurance assets Reinsurance assets 87.8 48.2 Ceded rei
Slide 18: Commercial insurance pricing environment remains robust
Commercial insurance pricing environment remains robust Marsh Global Insurance Market Index 22% 20% 19% 18% 15% 15% 14% 13% 11% 11% 9% 8% 6% 6% 4% 4% 3% 3% 2% 1% 1% 1% 1% -2% -2% -2% -3% -3% -4% -4% -5% Global commercial insurance prices rose 3% in the second quarter of 2023 The Marsh Global Ins
Slide 19: Investor relations calendar - 2023
Investor relations calendar - 2023 Conduit Re scheduled disclosures Conduit Re planned roadshows & conferences 8 November: Q3 2023 trading update 11-12 September: Monte Carlo rendez-vous 2-4 October: New York, Boston, Chicago 12 October: Berenberg conference in London 19
Slide 20: Forward looking statements
Forward looking statements Important note: This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", “goals”
Slide 21: conduitreinsurance.com
Enquiries please contact: H/Advisors Maitland Vikki Kosmalska / Alistair de Kare-Silver +44 (0) 207 379 5151 conduitre@h-advisors.global Antonio Moretti Investor Relations +44 (0) 7935 708 723 Antonio.Moretti@conduitre.bm About Conduit Re Conduit Re is a a pure-play Bermuda-based reinsurer, with a g