Lancashire Holdings Limited · LSE:LRE
Lancashire — Investor Presentation (June 2020)
18 slides from Lancashire's investor presentation, June 2020
Slide 1: Investor Presentation: Placing of Common Shares
Investor Presentation Placing of Common Shares June 2020 www.lancashiregroup.com
Slide 2: Safe harbour statements
Safe harbour statements IMPORTANT NOTICE This document, any ancillary documents relating to it, any oral presentation and any question and answer session (together, the “Materials”) have been prepared by Lancashire Holdings Limited (the “Company”) solely for informational purposes. By attending this
Slide 3: Safe harbour statements
Safe harbour statements The information contained in the Materials, some of which is from public or third party sources, has not been independently verified and some of the information is still in preliminary or draft form. Certain figures included in the Materials have been subject to rounding adju
Slide 4: Why invest in Lancashire
Why invest in Lancashire: 1. Underwriting comes first, whatever the market environment. This core principle has helped us deliver a market-leading track record, with better combined ratios over 3 years (0.3 pts outperformance) 5 years (9.1 pts outperformance) and 10 years (21.7 pts outperformance) t
Slide 5: Our long-term performance is one of the most consistent in our peer group
Our long-term performance is one of the most consistent in our peer group (1) 10 year Compound Annual RoE (2) 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% Beazley Lancashire Arch RenRe Everest Average Axis Hanover Hiscox Argo Third Point Greenlight -2.0% -4.0% (1) Peer group as defined by the Bo
Slide 6: Why are we raising capital now?
Why are we raising capital now? 1. Market changes in risk perception are leading to stronger pricing momentum in our core lines of business. Over the past 12- 24 months, actions taken by some of our peers to re-trench, as well as rating agency and regulatory pressure on the insurance industry to imp
Slide 7: Positive pricing momentum: cumulative rate changes since 2015
Positive pricing momentum: cumulative rate changes since 2015 130% 125% 120% 115% 110% Rate Change (%) 105% 100% 95% 90% 85% 80% 12 Months 2015 12 Months 2016 12 Months 2017 12 Months 2018 12 Months 2019 3 Months 2020 Property Energy Marine Aviation Total 7
Slide 8: We aim to maximise returns across the cycle
We aim to maximise returns across the cycle As shareholders ourselves, we care about: 1. Delivering a superior underwriting performance 2. Maintaining a strong balance sheet 3. Actively managing our capital base to support healthy shareholder returns in different operating environments We are less f
Slide 9: Active use of capital management: further helps deliver shareholder returns
Active use of capital management: further helps deliver shareholder returns 500 350% 450 18.0% 300% 400 15.2% 17.8% 250% 350 12.3% 17.3% 18.1% 300 200% ($m) 250 8.3% 150% 200 8.4% 10.5% 150 100% 100 4.5% N/A 50% 50 1.6% 1.5% 0 0% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (1) S
Slide 10: Placing overview
Placing overview • Structure: Accelerated bookbuild via a cash-box placing • Proceeds: Expected gross proceeds of approximately £305 million (approx. $387 million) • Placing size: Up to approximately 39.6 million new common shares representing approximately 19.5% of the Company’s issued share capita
Slide 11: Additional Information
Additional Information
Slide 12: Lancashire is a global specialty P&C reinsurer
Lancashire is a global specialty P&C reinsurer Active portfolio construction and risk management will continue to support our performance irrespective of market conditions Our business model centers around our “Underwriting comes first” principle: 1. We aim to maximise risk-adjusted returns over the
Slide 13: Underwriting comes first: Delivering better returns, even in heavier loss years
Underwriting comes first: Delivering better returns, even in heavier loss years Combined Ratio (1) 120% 100% 80% 60% 40% 20% 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (2) Lancashire Sector average Lancashire 10 year average Sector 10 year average • Delivering strong combined ratios in spe
Slide 14: Conservative portfolio structure – quality
Conservative portfolio structure – quality asset allocation credit quality total investment portfolio fixed maturities and managed cash non agency structured private debt 1% cash and short term products securities 8% agency structured 16% AA, 30% products A, 30% 6% other government bonds and debt he
Slide 15: For more information
For more information: Investor Relations Media Contacts Jelena Bjelanovic FTI Consulting Lancashire Holdings Limited 200 Aldersgate, 29th Floor, Aldersgate Street, 20 Fenchurch Street, London, EC3M 3BY London, EC1A 4HD Telephone: +44 (0) 20 7264 4066 Email: Tom.Blackwell@fticonsulting.com Fax: +44 (
Slide 16: Additional Information: Notice to Investors
Additional Information NOTICE TO INVESTORS The Materials are for information purposes only and do not constitute or form a part of any offer or solicitation to purchase or subscribe for securities in the United States, Australia, Canada, the Republic of South Africa or Japan or in any jurisdiction i
Slide 17: Notice to Canadian Investors
Additional Information NOTICE TO CANADIAN INVESTORS General The Company may, but is under no obligation to, permit certain persons that are in Canada or subject to the securities laws of Canada to participate in any offer or sale of securities that may be issued in connection to the matters referred
Slide 18: Notice to Canadian Investors (continued)
Additional Information NOTICE TO CANADIAN INVESTORS (continued) The recipient of this document should refer to any applicable provisions of the securities legislation of its province or territory for particulars of these rights or consult with a legal advisor. The Permitted Client acknowledges that,
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