Global Indemnity Group, Llc · NASDAQ:GBLI
Global Indemnity — Investor Presentation (March 2020)
30 slides from Global Indemnity's investor presentation, Mar 12, 2020
Slide 1: Investor Presentation March 12, 2020
Exhibit 99.1 INVESTOR PRESENTATION March 12, 2020Exhibit 99.1 INVESTOR PRESENTATION March 12, 2020
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may include forward-looking statements, both with respect to Global Indemnity Limited (the Company”) and its industry, that reflect our current views with respect to future events and financial performance. These statements are made pursuant to the safe h
Slide 3: Saul Fox, Chairman
Saul Fox Chairman Global Indemnity Ltd. 3 Global Indemnity Ltd.Saul Fox Chairman Global Indemnity Ltd. 3 Global Indemnity Ltd.
Slide 4: The Global Indemnity Build-Up
The Global Indemnity Build-Up • 2003: Global Indemnity Ltd. (“Global Indemnity” or the “Company”) is a ‘specialty’ commercial and personal lines property & casualty insurance company. The Company provides insurance coverage for risks that 'standard insurance carriers’ generally avoid, including, for
Slide 5: The Global Indemnity Build-Up (continued)
The Global Indemnity Build-Up (continued) • 2005: Fox Paine arranged Global Indemnity’s acquisition of (i) publicly listed Penn America Group, an excess and surplus lines insurer targeting ‘main street’ commercial risks, in a $161 million stock & cash for stock merger and (ii) privately held Penn In
Slide 6: The Global Indemnity Build-Up (continued)
The Global Indemnity Build-Up (continued) • 2015: Global Indemnity and Fox Paine arranged the $273 million buyback (redemption) of 11.7 million Global Indemnity shares (approximately 45% of the Company’s outstanding shares) held beneficially by Fox Paine Fund II investors. Fox Paine itself, however,
Slide 7: Background on Fox Paine Fund II & Saul Fox
Background on Fox Paine Fund II & Saul Fox Fox Paine Fund II $1,951 ($ in millions) • Global Indemnity was one of six platform (build-up) investments in Fox Paine Fund II, which was launched in $130 2000. Fox Paine Fund II invested, in aggregate, $682 million across the six platform investments from
Slide 8: Inception to Date Performance
Inception to Date Performance • Over the 17 Years (2003-2019) since Global Indemnity was organized: • Revenues (gross written premiums) grew by 8.2% per year or 3.5x over the period, far surpassing the 4.9% median revenue growth rate of the property & casualty industry over the same time period. • B
Slide 9: Conservative Balance Sheet & Asset & Liability Management
Conservative Balance Sheet & Asset & Liability Management Global Indemnity takes a conservative approach to managing its Assets and Liabilities. • AM Best, the preeminent insurance industry rating agency, in its January 21, 2020 press release confirming Global Indemnity’s ‘A’ Excellent rating, state
Slide 10: Operating & Financial Leverage Lower than P&C Median
Global Indemnity’s Operating & Financial Leverage is 27% to 44% Lower than the Property & Casualty Median Global Indemnity’s operating/financial leverage Net Written Premiums (“NWP”) + Loss Reserves + Debt / Tangible Book Capital is 27% to 44% lower than the median of the Property & Casualty Industr
Slide 11: Driving Long-Term Growth in Book Value Per Share
Driving Long-Term Growth in Book Value Per Share Global Indemnity has a proven track record of long-term growth in book value per share while maintaining a strong balance sheet, limited financial & operating leverage and taking a measured approach to growth, while employing insurance industry best p
Slide 12: Cynthia Valko, Chief Executive Officer
Cynthia V alko Chief Executive Officer Global Indemnity Ltd. 12 Global Indemnity Ltd.Cynthia V alko Chief Executive Officer Global Indemnity Ltd. 12 Global Indemnity Ltd.
Slide 13: Cynthia Valko
Cynthia V alko • Chief Executive Officer of Global Indemnity Ltd. since Global Indemnity Combined Ratio September 2011. Improvement since 2011 • Over forty years of experience as an insurance industry executive. • Directed turnaround/sales transactions for Cerberus Private Equity’s Insurance busines
Slide 14: Specialty Insurance Company
Specialty Insurance Company • Global Indemnity is a U.S. domestic insurer and a Bermuda-based international reinsurer specializing in Excess & Surplus (E&S) lines, as well as specialty admitted business. • E&S provides coverages that are unavailable in standard insurance markets for clients with uni
Slide 15: Gross Written Premiums
Global Indemnity Ltd. Gross Written Premiums • Rated “A” (Excellent) by AM Best since organized by Fox Paine in 2003 $637,000,000 • $637 million of Gross Written Premiums in 2019 Casualty $218m • 570 producer relationships 34% with wholesale general agents, Property program administrators, $419m who
Slide 16: Global Indemnity – Business Units
Global Indemnity – Business Units Global Indemnity Ltd. 2019 Gross Written Premiums: $637m Loss Ratio: 52.4% Combined Ratio: 92.2% International Reinsurance U.S. Insurance Operations Operations Commercial Specialty Specialty Property Reinsurance Gross Written Premiums: $297m Gross Written Premiums:
Slide 17: Commercial Specialty
Commercial Specialty • Global Indemnity’s Commercial Specialty division is a leading independent provider of small ticket excess and surplus lines. • The division’s “Underwriting Gross Margin” (premiums less incurred losses before commissions and other underwriting expenses) averaged 47% over the pa
Slide 18: Specialty Personal Lines
Specialty Personal Lines • American Reliable acquired in 2015: • $270 million in premiums doubling size of the Company 2019 • Business operated at about a 100% Combined Ratio, which could be (and has American Reliable been) substantially enhanced • 100% Loss Reserve Guaranty from seller Turnaround •
Slide 19: Reinsurance
Reinsurance • Global Indemnity Re, a licensed Bermuda reinsurer, has been and will continue to be a very important component of the Company’s organizational structure and operating strategy. • As a result of changes in tax law, Global Indemnity Re no longer provides reinsurance to the Company’s dome
Slide 20: Thomas McGeehan, Chief Financial Officer
Thomas McGeehan Chief Financial Officer Global Indemnity Ltd. 20 Global Indemnity Ltd.Thomas McGeehan Chief Financial Officer Global Indemnity Ltd. 20 Global Indemnity Ltd.
Slide 21: Thomas McGeehan
Thomas McGeehan • Joined Global Indemnity in 2001 Global Indemnity Combined Ratio • 35-year insurance industry veteran Improvement since 2011 • Served as Chief Financial Officer since December 2009 (Interim CFO from May 2008 to December 2009) • Appointed Corporate Controller within Global Indemnity
Slide 22: 2019 Results
2019 Results In 2019, Global Indemnity generated record earnings per share of $4.88 and net income of $70 million, an increase of $127 million over 2018: • Gross Written Premiums Grew by 16% to $637 million. • Net Written Premiums increased 19% to $562 million, a record for the Company. • The Compan
Slide 23: 2019 Results (continued)
2019 Results (continued) • The Company ‘s $70 million of net income was a $127 million increase over 2018: • 50% of the increase resulted from the reduction in the Company’s exposure to and losses from natural catastrophes • 29% of the increase resulted from the reversal in 1Q19 of the 4Q18 drop in
Slide 24: The Company's 2020 Business Plan
1 The Company’s 2020 Business Plan Discretionary Capital • Assumes 3.5% (pre-tax) return from the Company’s Investment Portfolio 41% Growth • 2019’s actual Investment Portfolio return was 7.8% (pre-tax) ($ in millions) • The reduction in the assumed Investment Portfolio return results in an 18% $304
Slide 25: Saul Fox, Chairman
Saul Fox Chairman Global Indemnity Ltd. 25 Global Indemnity Ltd.Saul Fox Chairman Global Indemnity Ltd. 25 Global Indemnity Ltd.
Slide 26: ROE is Key Determinant to Trading Prices of P&C Insurers
Return on Equity (ROE) is Key Determinant to Trading Prices of P&C Insurance Companies • Public trading prices for the universe of 43 publicly-traded U.S. property & casualty companies correlate closely with their 5-year average ROE. • Global Indemnity’s current Price-to-Book Value trading multiple
Slide 27: Global Indemnity Continues to Be a Unique Investment Opportunity
Global Indemnity Continues to Be a Unique Investment Opportunity Implied GBLI Trading Range • 2003-2019 7.5% annual Book Value Per Share $83.00 growth track record (*) • Normalized ROE of 8% in 2019 while substantially less leveraged than industry peers • Strong Balance Sheet, over-capitalized for $
Slide 28: Appendix
APPENDIX 28 Global Indemnity Ltd.APPENDIX 28 Global Indemnity Ltd.
Slide 29: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes certain financial information that differs from what is reported under U.S. GAAP. These non-GAAP financial measures, which include, but are not limited to, normalized return on equity and normalized investment gain, are presented in order to sup
Slide 30: Non-GAAP Adjusted Operating Income
Non-GAAP Financial Measures Non-GAAP Adjusted Operating Income ($000s) Non-GAAP adjusted operating income represents after tax income without consideration of realized investment gains and other unique charges not related to operations. Year Ended December 31, 2019 Net Income $ 70 ,015 Realized gain
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