Slide 1: Investor Presentation - Third Quarter 2015
November 2015 Financial information as of September 30, 2015 NASDAQ: TIPT INVESTOR PRESENTATION - THIRD QUARTER 2015
Slide 2: Limitations on the Use of Information
1 LIMITATIONS ON THE USE OF INFOMRATION This presentation has been prepared by Tiptree Financial Inc. (“Tiptree Financial”) and Tiptree Operating Company, LLC (the “Company”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree Fi
Slide 3: Overview Key Highlights
OVERVIEW Key Highlights
Slide 4: Tiptree Financial Inc. - Third Quarter Key Highlights
3 Tiptree Financial Inc. Insurance and Insurance Services Specialty Finance Real Estate Asset Management Corporate and Other TIPTREE FINANCIAL INC. - THIRD QUARTER KEY HIGHLIGHTS • Growing demand for non-bank consumer finance continues to drive robust growth in credit protection products, underlying
Slide 5: Financial Results: Three and Nine Months Ended September 30, 2015
Three and Nine Months Ended September 30, 2015 FINANCIAL RESULTS
Slide 6: Key Drivers of Consolidated Results
5 (1) The consolidated non-corporate and non-acquisition related interest expense subtracted from Adjusted EBITDA includes interest expense associated with asset-specific debt at subsidiaries in the insurance and insurance services, specialty finance, real estate and corporate and other segments. Fo
Slide 7: Segment Total Revenue Contribution
6 SEGMENT TOTAL REVENUE CONTRIBUTION YTD September 30, 2015 Insurance and insurance services (Fortegra) $238,891 67.3% Specialty finance $33,583 9.5% Real estate $33,334 9.4% Asset management $8,307 2.3% Corporate and other $382 0.1% Insurance and insurance services (PFG) $40,459 11.4% Specialty fin
Slide 8: Segment Adjusted EBITDA
7 SEGMENT ADJUSTED EBITDA From Continuing Operations Adjusted EBITDA also grew year over year, while the segment contributions to the metric shifted • Excluding a $7.9 million one time gain of Care in 2014, growth in Adjusted EBITDA was driven by Care and Specialty Finance, along with strong contrib
Slide 9: Opportunities for Growth
Tiptree Operating Company and Tiptree Financial OPPORTUNITIES FOR GROWTH
Slide 10: Improving US Economic Fundamentals Drive Growth Trajectory
9 Sources: (a) US. Bureau of Economic Analysis, (b) Surveys of Consumers University of Michigan; (c) Federal Reserve Bank of St. Louis IMPROVING US ECONOMIC FUNDAMENTALS DRIVE GROWTH TRAJECTORY FOR TIPTREE •The US economy has stabilized and has been showing signs of improving growth fundamentals. •U
Slide 11: Insurance and Insurance Services Opportunities for Growth
Insurance and Insurance Services OPPORTUNITIES FOR GROWTH
Slide 12: Insurance and Insurance Services - Growth Opportunity Drivers
11 (a) Does not include Mortgage, home equity revolving, auto nor student loan debt. (b) The index is set at 100 at December 2012 for comparative purposes. Sources: (c) Federal Reserve Bank of New York Quarterly Report on Household Debt and Credit - August 2015; (d) Federal Reserve Bank of St. Louis
Slide 13: Fortegra Revenue Bridge
12 3Q 2015 QTD Net Revenue 35.0 30.0 25.0 Q3 2 014 Cred it Pro tectio n Warr anty/ Auto Spec ialty Prod ucts Servi ces & Othe r Q3 2 015 28.6 1.5 0.7 0.5 (1.2) 30.1 YTD 9 Months 2015 Net Revenue 90.0 85.0 80.0 75.0 YTD 9 /201 4 Cred it Pro tectio n Warr anty/ Auto Spec ialty Prod ucts Servi ces & Ot
Slide 14: Fortegra Unaudited Pro Forma 2015 Financial Information
13 FORTEGRA UNAUDITED PRO FORMA 2015 FINANCIAL INFORMATION Tiptree is presenting the following unaudited proforma financial information of Fortegra for the three and nine months ended September 30, 2015 to allow Tiptree investors to compare Fortegra's performance without the purchase price allocatio
Slide 15: Specialty Finance Opportunities for Growth
Specialty Finance OPPORTUNITIES FOR GROWTH
Slide 16: Specialty Finance
15 (a) Measures whether a family earning median family income could qualify for a mortgage loan on a typical home defined as a national median-priced, existing single-family home. An index value of 100 means that a median income family has exactly enough to qualify while an index value of greater th
Slide 17: Specialty Finance - Margin and Product Mix
16 Net revenue Mortgage Margin (in bps) 350 300 250 200 150 100 (B as is po in ts ) 2015 2014 286 160 SPECIALTY FINANCE - MARGIN AND PRODUCT MIX Funded Volume 800 700 600 500 400 300 200 100 0 $ (M ill io ns ) 2015 2014 $791.3 $325.8 Mortgage Origination Nine Months Ended September 30, 2015 vs 2014
Slide 18: Specialty Finance - Revenue Contribution and Adjusted EBITDA
17 SPECIALTY FINANCE - Total Revenues Contribution and Adjusted EBITDA • Pre-tax income was $1.3 million and $2.3 million for the quarter and first nine months, respectively. • The increases in Net Income, Revenues and Adjusted EBITDA versus 2014 were driven primarily by: • Higher mortgage funding v
Slide 19: Real Estate Opportunities for Growth
Real estate OPPORTUNITIES FOR GROWTH
Slide 20: Real Estate
19 (a) AL represents Assisted Living, IL represents Independent Living, SA represents Senior Apartments, MC represents Memory Care, and SNF represents Skilled Nursing Facilities. Sources: (b) United States Census Bureau – 2014 National Population Projections REAL ESTATE • Care’s real estate investme
Slide 21: Real Estate Portfolio Snapshot
20 2013 and prior 2014 and after Portfolio Growth $250 $225 $200 $175 $150 $125 $100 $75 $50 $25 $0 To ta lP ur ch as e Pr ic e ($ m m ) $109.1 $123.8 $232.9 REAL ESTATE PORTFOLIO SNAPSHOT (1) Represents total purchase price of the portfolios, which includes amounts contributed by non-controlling in
Slide 22: Segment Results - Real Estate
21 SEGMENT RESULTS - REAL ESTATE 33,000 27,500 22,000 16,500 11,000 5,500 0 $ (T ho us an ds ) 2015 2014 $33,334 $14,854 $7,900 $22,754 15,000 12,500 10,000 7,500 5,000 2,500 0 $ (T ho us an ds ) 2015 2014 $3,852 $2,272 $7,900 $10,172 Nine Months Ended September 30, 2015 vs 2014 Westside loan Total
Slide 23: Asset Management and Principal Investments Opportunities for Growth
Asset Management and Principal Investments OPPORTUNITIES FOR GROWTH
Slide 24: Asset Management and Principal Investments - Opportunities for Growth
23 Sources: (a) Federal Reserve Bank of St. Louis; (b) Federal Reserve Economic Projections of Federal Reserve Board Members and Federal Reserve Bank Presidents, September 2015. ASSET MANAGEMENT AND PRINCIPAL INVESTMENTS - OPPORTUNITIES FOR GROWTH •Growth in assets under management (“AUM”) will bene
Slide 25: Segment Results - Asset Management
24 SEGMENT RESULTS - ASSET MANAGEMENT • Net Income attributable to Consolidated CLOs is split between two segments: 1. Asset management fees in the Asset Management Segment 2. Distributions and realized and unrealized losses in principal investments, in the form of subordinated notes, included in Co
Slide 26: Segment Results - Corporate and Other
25 SEGMENT RESULTS - CORPORATE AND OTHER • Incorporates revenues from the Company’s principal investment activities and expenses including interest expense on the Fortress credit facility, head office payroll and other expenses, such as audit fees. • Pre-tax loss for the third quarter 2015 of $14.5
Slide 27: Well Positioned for the Remainder of 2015 and Beyond
26 WELL POSITIONED FOR THE REMAINDER OF 2015 AND BEYOND • As we move into the fourth quarter of 2015 and look forward to 2016, we are well positioned to take advantage of any improvements in the US economy. • Adjusted EBITDA growth is expected to benefit from: • Continued revenue growth of Fortegra,
Slide 28: Appendix
APPENDIX
Slide 29: EBITDA and Adjusted EBITDA Non-GAAP Measures
28 In addition to the results of operations presented in accordance with GAAP, management uses EBITDA and Adjusted EBITDA on a consolidated basis and for each segment, which are non-GAAP financial measures. We believe that consolidated EBITDA and Adjusted EBITDA provide supplemental information usef
Slide 30: Adjusted EBITDA Notes
29 Notes: (1) The consolidated non-corporate and non-acquisition related interest expense subtracted from Adjusted EBITDA includes interest expense associated with asset-specific debt at subsidiaries in the insurance and insurance services, specialty finance, real estate and corporate and other segm
Slide 31: EBITDA and Adjusted EBITDA Non-GAAP Measures
30 In addition to the results of operations presented in accordance with GAAP, management uses EBITDA and Adjusted EBITDA on a consolidated basis and for each segment, which are non-GAAP financial measures. We believe that consolidated EBITDA and Adjusted EBITDA provide supplemental information usef
Slide 32: EBITDA and Adjusted EBITDA Non-GAAP Measures
31 In addition to the results of operations presented in accordance with GAAP, management uses EBITDA and Adjusted EBITDA on a consolidated basis and for each segment, which are non-GAAP financial measures. We believe that consolidated EBITDA and Adjusted EBITDA provide supplemental information usef
Slide 33: Tiptree Financial Inc. and the Company - Book Value Per Share
32 TIPTREE FINANCIAL INC. AND THE COMPANY - BOOK VALUE PER SHARE Tiptree Financial’s book value per share was $9.12 as of September 30, 2015 compared with $8.94 as of December 31, 2014. Total stockholders' equity for the Company was $398.1 million as of September 30, 2015, which comprised total stoc