Tiptree Inc. · NASDAQ:TIPT
Tiptree — Q3 2017 Earnings Presentation
22 slides from Tiptree's earnings presentation, Nov 7, 2017
Slide 1: Investor Presentation - Third Quarter 2017
November 2017 Financial information for nine months ended September 30, 2017 NASDAQ: TIPT INVESTOR PRESENTATION - THIRD QUARTER - 2017 Exhibit 99.2
Slide 2: Limitations on the Use of Information
1 LIMITATIONS ON THE USE OF INFORMATION This presentation has been prepared by Tiptree Inc. and its consolidated subsidiaries (“Tiptree", "the Company" or "we”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree, its subsidiarie
Slide 3: Overview & Financial Results: Key Highlights
OVERVIEW & FINANCIAL RESULTS Key Highlights
Slide 4: 3Q'17 Performance Summary
3 Revenue $164.5 million 24.5% vs. prior year Adjusted EBITDA (1) $4.8 million vs. prior year of $20.1 million Book Value per share, as exchanged (1) $9.67 (2.6)% vs. 9/30/16 Net loss $3.4 million vs. prior year income of $7.8 million 3Q'17 PERFORMANCE SUMMARY þ Net loss for the quarter and the year
Slide 5: Financial Results
4 $27.6 $(1.4) $1.4 $(2.7) $(3.0) $(4.4) $(27.6) $(10.1) $52.9 $3.7 $1.4 $(2.7) $(4.4) $(27.6) $23.3 Adjusted EBITDA(1) ($ in millions, except per share information) Financial metrics FINANCIAL RESULTS (1) See the appendix for a reconciliation of book value per share as exchanged and Adjusted EBITDA
Slide 6: Capital Allocation
5 ($ in millions, except per share information) Invested Capital (1) CAPITAL ALLOCATION (1) See the appendix for a reconciliation of Invested Capital, Total Capital and Normalized EBITDA. (2) Corporate debt includes secured corporate credit agreements and preferred trust securities. (3) Last twelve
Slide 7: Key Performance Highlights
Nine Months Ended September 30, 2017 KEY PERFORMANCE HIGHLIGHTS
Slide 8: Specialty Insurance Key Financials
7 26.1 22.3 $15.6 19.5 $45.6 (6.7) Key financials (1) Continuing to expand product offerings and focused on growth in written premiums • $529m of unearned premiums and deferred revenue, representing 12.7% year-over-year growth • Net written premiums grew by $150m, driven by increased retention in cr
Slide 9: Specialty Insurance - Investment Portfolio
8 Investments (1) SPECIALTY INSURANCE - INVESTMENT PORTFOLIO ($ in millions) Interest expense Realized gains (losses) Net Investment Income Unrealized gains (losses) Year-to-date investment portfolio income Overview We actively manage our investment portfolio to achieve a balance of two primary obje
Slide 10: Asset Management
9 As adjusted revenue components (1) Year-to-date financial highlights Year-over-year decline in pre-tax income driven by: • Declining management fees as older vintage CLOs run-off • Distributions from investments decreased as we continued to reduce our sub-note holdings Partially offset by: • $3.4m
Slide 11: Senior Living
10 YTD'16 YTD'17 $5.5 $8.2 Key financials (1) Year-to-date highlights and outlook Pre-tax income flat over prior year driven by higher depreciation and other expenses from recently acquired properties • Quarterly pre-tax income down over prior year as industry softness delays improvements in occupan
Slide 12: Outlook
11 Book value per share as exchanged Adjusted EBITDA Trailing Twelve Months OUTLOOK • Continued growth in specialty insurance operations – Unearned premiums and deferred revenue growth of 12.7% • Improvements in long-term, net investment income as our insurance investment portfolio grows • Increasin
Slide 13: Appendix
APPENDIX
Slide 14: EBITDA and Adjusted EBITDA Reconciliation
13 Management uses EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that use of these financial measures on a consolidated basis and for each segment provide supplemental information useful to investors as it is frequently used by the financial community to ana
Slide 15: EBITDA and Adjusted EBITDA Reconciliation
14 Management uses EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that consolidated EBITDA and Adjusted EBITDA on a consolidated basis and for each segment provide supplemental information useful to investors as it is frequently used by the financial communit
Slide 16: EBITDA, Adjusted and Normalized EBITDA Reconciliation
15 Management uses EBITDA, Adjusted EBITDA and Normalized EBITDA, which are non-GAAP financial measures. The Company believes that consolidated EBITDA, Adjusted EBITDA and Normalized EBITDA on a consolidated basis and for each segment provide supplemental information useful to investors as it is fre
Slide 17: Non-GAAP Reconciliations - BVPS, Invested and Total Capital
16 Management evaluates the return on Invested Capital and Total Capital, which are non-GAAP financial measures, when making capital investment decisions. Invested capital represents its total cash investment, including any re-investment of earnings, and acquisition costs, net of tax. Total Capital
Slide 18: Non-GAAP Reconciliations - Specialty Insurance
17 NON-GAAP RECONCILIATIONS - SPECIALTY INSURANCE The following table provides a reconciliation between as adjusted underwriting margin and pre-tax income. We generally limit the underwriting risk we assume through the use of both reinsurance (e.g., quota share and excess of loss) and retrospective
Slide 19: Non-GAAP Reconciliations - Specialty Insurance
18 NON-GAAP RECONCILIATIONS - SPECIALTY INSURANCE The following table presents product specific revenue and expenses within the specialty insurance segment. We generally limit the underwriting risk we assume through the use of both reinsurance (e.g., quota share and excess of loss) and retrospective
Slide 20: Investment Portfolio Net Investments and Net Portfolio Income
19 The investment portfolio consists of assets contributed by Tiptree, cash generated from operations, and from insurance premiums written. The investment portfolio of our regulated insurance companies, captive reinsurance company and warranty business are subject to different regulatory considerati
Slide 21: Non-GAAP Reconciliations - Asset Management
20 NON-GAAP RECONCILIATIONS - ASSET MANAGEMENT The Company earns revenues from CLOs under management, whether consolidated or deconsolidated, which include fees earned for managing the CLOs, distributions received from the Company’s holdings of subordinated notes issued by the CLOs and realized and
Slide 22: Non-GAAP Reconciliations - Senior Living
21 NON-GAAP RECONCILIATIONS - SENIOR LIVING In addition to Adjusted EBITDA, we also evaluate performance of our senior living segment based on net operating income (“NOI”), which is a non-GAAP measure. NOI is a common non-GAAP measure in the real estate industry used to evaluate property level opera