Tower Limited · NZX:TWR
Tower — Shareholder Meeting (February 2023)
24 slides from Tower's shareholder meeting presentation, Feb 28, 2023
Slide 1: Tower 2023 Annual Shareholder Meeting
Tower 2023 Annual Shareholder Meeting 28 February, 2023
Slide 2: Questions
Questions Shareholder & Proxyholder Q&A Participation Written Questions: Questions may be submitted ahead of the meeting. If you have a question to submit during the live meeting, please select the Q&A tab on the right half of your screen at anytime. Type your question into the field and press submi
Slide 3: Voting process
Voting process Shareholder & Proxyholder Voting Once the voting has been opened, the resolutions and voting options will allow voting. To vote, simply click on the Vote tab, and select your voting direction from the options shown on the screen. You can vote for all resolutions at once or by each res
Slide 4: Agenda
Agenda Chairman’s address Michael Stiassny, Chairman CEO's address Blair Turnbull, Chief Executive Officer Shareholder resolutions Questions & general business Michael Stiassny, Chairman 4
Slide 5: Chairman's address
Chairman’s address Tower responding to weather events; underlying business remains strong PROACTIVELY MANAGING CONTINUED FINANCIALLY RESILIENT LONG-TERM GROWTH CHALLENGES • Swift and proactive response to • AM Best A- financial strength • Flagship Tower Direct Auckland & Upper North Island and ratin
Slide 6: CEO's address
CEO’s address Blair Turnbull Chief Executive Officer 6
Slide 7: Rapid response to Auckland and Upper North Island Weather Event, Cyclone Gabrielle
Rapid response to Auckland and Upper North Island Weather Event, Cyclone Gabrielle AUCKLAND AND UPPER CLAIMS RECEIVED ONLINE NORTH ISLAND EVENT FOR AUCKLAND AND UPPER CLAIMS RECEIVED TO DATE NORTH ISLAND EVENT 5,325 80% 2,200 claims Proactive texts & received for Cyclone emails resulted in Gabrielle
Slide 8: Reinsurance programme provides protection
Reinsurance programme provides protection Auckland & Upper North Island weather event/ Cyclone Gabrielle • Auckland & Upper North Island event confirmed catastrophe event - $95m-$125m, $11.875m excess • Early stages of estimating financial impact of Cyclone Gabrielle. Likely it will also trigger cat
Slide 9: Ability to adapt quickly positions Tower for a strong future
Ability to adapt quickly positions Tower for a strong future TOWER STAFF BY LOCATION PRICING AGILITY RISK-BASED PRICING Coastal, 140+ landslides Planned for FY23. Pricing adjustments in Landslide underwriting FY22 implemented AUTOMATED HOUSE SUM SUPPLY CHAIN OPTIMISATION INSURED 97% 77% Of NZ custom
Slide 10: FY22 performance
FY22 ~ performance #4
Slide 11: A journey of innovation and resilience
A journey of innovation and resilience Leading with customer experience One core platform High performance Partnerships culture Pacific Direct Financially strong & resilient Simplification 3 Businesses 1 Core Business Product rationalisation modernisation & scalable & 11 to 14 core products digitisa
Slide 12: FY22 performance
FY22 performance Solid growth and increased efficiencies underpin strong underlying business performance GWP growth Customer growth BAU claims ratio MER (Gross written premium) (Management expense ratio) 13% | $457m 319,000 48.9% 36.0% vs $404m in FY21 vs 304,000 in FY21 vs 50.2% in FY21 vs 37.0% in
Slide 13: FY22: strong growth in customers and premium
FY22: strong growth in customers and premium GWP BY BUSINESS UNIT ($m) GWP GROWTH CUSTOMER GROWTH 13% 319,000 to $457m in FY22 up 5% on FY21 1 TOWER DIRECT COST TO ACQUIRE MULTIPLE PRODUCT DIGITAL QUOTES & SALES HOLDING 12% 50% of NZ customers have Down from 12.6% in two or more policies FY21 (50% i
Slide 14: FY22: scale and efficiencies improve claims and expense ratios
FY22: scale and efficiencies improve claims and expense ratios BAU CLAIMS RATIO BAU CLAIMS RATIO NZ WEATHER EVENTS (incl large and other events) 48.9% $18m vs 50.2% in FY21 vs five-year average of $11m MANAGEMENT EXPENSE RATIO (% NEP) MER NZ SERVICE TASKS COMPLETED DIGITALLY 36% 50% vs 37% in FY21 v
Slide 15: FY22: delivering shareholder returns
FY22: delivering shareholder returns CAPITAL RETURN & AM BEST T O W E R S O L V ETower N C Limited Y - N Z PARENT ($m) Parent Solvency DIVIDENDS FINANCIAL STRENGTH RATING $55.3m A- 7.3 2.3 18.9 15.8 19.7 returned to 31.5 31.4 shareholders from affirmed in 32.9 FY22 April 2022 Surplus to operating ra
Slide 16: Q1 trading update
Q1 trading update For the three months to December 31, 2022
Slide 17: Q1: continued strong premium growth
Q1: continued strong premium growth 2 GROSS WRITTEN PREMIUM NZ PERSONAL LINES GROWTH MARKET SHARE Group GWP ($m) – Year to date 1 12.5% 9.5% Q1 FY23 vs same period prior year1 up from 9.2% in Q1 FY22 ONLINE GROWTH NZ RISKS IN FORCE 3 CONTINUING 74% 582,000 • Balanced mix of rate and organic growth (
Slide 18: Q1: operational efficiencies through scale and investment
Q1: operational efficiencies through scale and investment MANAGEMENT EXPENSE RATIO (% NEP) MANAGEMENT EXPENSE MY TOWER REGISTRATIONS RATIO 35% 218,000 improved from 38% in vs 150,000 same Q1 FY22 period prior year COMMISSION EXPENSE RATIO (% GEP) CLAIMS LODGED DIGITALLY LEGACY BANK BOOK ACQUISITIONS
Slide 19: Q1: decisive actions to address claims challenges
Q1: decisive actions to address claims challenges NZ Motor Frequency CLAIMS RATIO EXCLUDING TARGETED RATING AND LARGE EVENTS UNDERWRITING ADJUSTMENTS 54% 49 1 2 vs 47% in Q1 FY22 during Q1, keeping ahead of inflation 1 National lockdown 2 Auckland lockdown CEQ CLAIMS OPEN OPTIMISING RECOVERIES & INV
Slide 20: Updated FY23 guidance
Updated FY23 guidance FY22 Actual FY23 Guidance GWP growth 13% 10% - 15% (excluding Tower PNG) Large events allowance (net of reinsurance recovery) $19m $40m Underlying NPAT (including large events) $27.3m $18m - $23m 1 Dividend 6.5 cents per share 5 cents per share Note 1: Tower’s ordinary dividend
Slide 21: Shareholder resolutions
Shareholder resolutions Michael Stiassny, Chairman
Slide 22: Shareholder resolutions
Shareholder resolutions Resolution 1 • Authorisation for Board to determine auditor remuneration Resolution 2 • Re-election of Michael Stiassny as Director of Tower Limited Resolution 3 • Re-election of Geraldine McBride as Director of Tower Limited 22
Slide 23: Questions?
2 | Questions?
Slide 24: Disclaimer
Disclaimer This presentation has been prepared by Tower Limited to provide shareholders with information on Tower’s business. This document is part of, and should be read in conjunction with an oral briefing to be given by Tower. A copy of this webcast of the briefing is available at http://www.towe