Lancashire Holdings Limited · LSE:LRE
Lancashire — Investor Presentation (January 2019)
18 slides from Lancashire's investor presentation, Jan 15, 2019
Slide 1: Analyst briefing
Analyst briefing 15th Jan 2019 Lancash Ire January 2019 www.lancashiregroup.com Holdings Limited
Slide 2: Note regarding forward-looking statements
NOTE REGARDING FORWARD-LOOKING STATEMENTS: CERTAIN STATEMENTS AND INDICATIVE PROJECTIONS (WHICH MAY INCLUDE MODELED LOSS SCENARIOS) MADE IN THIS BRIEFING PAPER OR OTHERWISE THAT ARE NOT BASED ON CURRENT OR HISTORICAL FACTS ARE FORWARD-LOOKING IN NATURE INCLUDING, WITHOUT LIMITATION, STATEMENTS CONTA
Slide 3: Our strategy is unchanged as we go into 2019
Our strategy is unchanged as we go into 2019 Active portfolio construction & risk management will continue to support our performance irrespective of market conditions. Our business model centres around our “Underwriting comes first” principle: 1. We aim to be one of the most profitable global speci
Slide 4: Pricing: What we said at Q3
Pricing: What we said at Q3 Rating levels likely to stabilise or improve for 2019: * Catastrophe rates will be ‘flattish’, with marginally negative pricing pressure in some territories, and marginally positive in others that have experienced losses this year or in 2017 * Specialty insurance rates ha
Slide 5: January renewals consistent with our messaging
January renewals consistent with our messaging Catastrophe is ‘flattish’: * Insured catastrophe losses of 2018 for the market were outsize relative to history, but below 2017 levels * Different trends by geography and loss experience * Overall ‘flattish’, awaiting April 1 renewals Specialty is benef
Slide 6: Reinsurance purchasing strategy has not changed
Reinsurance purchasing strategy has not changed Retro market seeing some disruption: * Products on offer changed given less capital available to some ILS capacity providers * Structure of program is as important as the price (if not more so) - As we go through 2019, the uncertainty around retro capa
Slide 7: Kinesis: continued disciplined growth
Kinesis: continued disciplined growth ILS market uncertainty may well continue in 2019: * For 2018, the performance of most funds is likely to be negative /flat * We consider that larger, well-respected firms managed to raise more funds * Market at 1/1 had enough capacity for good performing risks,
Slide 8: Underwriting comes first
Underwriting comes first (Mj Lancashire
Slide 9: Underwriting comes first, whatever the market environment
Underwriting comes first, whatever the market environment Combined ratio 120% Harvey, Irma, Maria, Florence, Trami, Wildfires yeti 100% | Japan EQ, NZI, UsTomadoes, Thai Floods, 80% Gryphon FPSO r - Chile EQ, Costa Concordia, Deepwater Horizon sandy 60% 40% 20% 0% 2008 2009 2010 2011 2012 2013 2014
Slide 10: Effectively balance risk and return
(Mj Lancashire Effectively balance risk and return 10
Slide 11: Effectively balancing risk and return
Effectivelybalancing risk and return: Robust risk management process Daily Underwriting Marketing Conference Call (UMCC) Risk and Return Committee Disciplined capital deployment Allows for better risk selection and portfolio construction * Supports our Underwriting comes first principle: senior mana
Slide 12: Operate nimbly through the cycle
Operate nimbly through the cycle (Mj Lancashire
Slide 13: Operate nimbly through the cycle: Active use of capital management
Operate nimbly through the cycle: Active use of capital management further helps deliver shareholder returns 500 300% 450 18.0% 250% 78%, 12.3% 17.3% 200% 150% ($m) 10.5% 100% 2.0% | som 1.6% | o% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 YTD Q3 2018 ME Share repurchases IEEE Special di
Slide 14: Overview of Lancashire: our year history
Overview of Lancashire: our 13 year history 2005: LHL Incorporated; AM Best assigns A- rating; IPO & listing on AIM GPW ($m) Combined ratio Dividend yield Return on Equity @ Tangible capital No. of employees 2006 * Sirocco sidecar launched * London office opened 626 753 638 528 689 632 n/a 44.3% 46.
Slide 15: Overview of Lancashire: our year history
Overview of Lancashire: our 13 year history GPW ($m) Combined ratio Dividend yield“ Return on Equity ?) Tangible capital No. of employees 2012 2013 * Rollover of * Purchase of Accordion sidecar Cathedral Capital + Saltire facility Limited . haaey se) * Launch of Kinesis million of 5.7% Capital senio
Slide 16: Conservative investment portfolio structure — focus on quality
Conservative investment portfolio structure — focus on quality Asset allocation non agency structured cash and short ‘term securities 7% agency structured products 7% hedge funds sther government 9% onds and debt 4% equities & defivem duration 1% 1.6 years US. government bonds and agency debt 7% cor
Slide 17: Financial and events calendar
Financial and events calendar: 2019 15 Jan — Analyst briefing, London 14 Feb—- Q4 2018 Earnings release 19 - 21 Mar-— Morgan Stanley Financials Conference 02 May — QI 2019 Earnings release 25 Jul — Q2 2019 Earnings release t. | Lancashire Holdings Limited 7
Slide 18: For more information
For more information: Investor Relations Media Contacts Jelena Bjelanovie Haggie Partners Lancashire Holdings Limited 4Sun Court 29th Floor, 66-67 Cornhill 20 Fenchurch Street, : London, EC3M 4BY Email: Emily. Murphy@haggie.co.uk Telephone: +44 (0) 20 7264 4066 : Fax: +44 (0) 20 7264 4077 Email: jel
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