Tiptree Inc. · NASDAQ:TIPT
Tiptree — Q1 2017 Earnings Presentation
21 slides from Tiptree's earnings presentation, May 11, 2017
Slide 1: Investor Presentation - First Quarter 2017
May 2017 Financial information for three months ended March 31, 2017 NASDAQ: TIPT INVESTOR PRESENTATION - FIRST 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: 1Q'17 Performance Summary
3 Revenue $163.9 million 25.4% vs. prior year Adjusted EBITDA (1) $11.8 million (23.1)% vs. prior year Book Value per share, as exchanged (1) $10.15 11.5% vs. 3/31/16 Net Income $1.3 million vs. prior year of $7.4 million 1Q'17 PERFORMANCE SUMMARY þ Specialty Insurance continued to recalibrate the p
Slide 5: Segment Performance Summary
4 SEGMENT PERFORMANCE SUMMARY ($ in millions) (1) See the appendix for a reconciliation of Adjusted EBITDA Pre-tax income Adjusted EBITDA(1) 12.2 4.8 2.7 $4.9 5.6 (3.9) (1.5) (1.0) 0.5 $2.5 (5.1) (6.8) Senior Living Specialty Finance Specialty Insurance Asset Management Corporate & Other 1Q'171Q'16
Slide 6: Financial Trends
5 Book value per share (1) as exchanged (in millions, except per share information) Diluted earnings per share FINANCIAL TRENDS 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 $0.05 $0.17 $0.19 $0.25 $0.03 $0.11 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 $15.3 $17.4 $20.1 $26.1 $11.8 Tiptree enterprise value • Tax: Diluted EPS im
Slide 7: Key Performance Highlights
Three Months Ended March 31, 2017 KEY PERFORMANCE HIGHLIGHTS
Slide 8: Specialty Insurance Key Financials
7 Key financials (1) Financial highlights Pre-tax income and Adjusted EBITDA down year-over-year – Investment income of $3.8m, down $2.5m primarily from declines in equity market values – As adjusted underwriting margin of $26.2m, down $1.5m driven by softness in credit and mobile protection product
Slide 9: Specialty Insurance - Investment Portfolio
8 SPECIALTY INSURANCE - INVESTMENT PORTFOLIO ($ in millions) Interest expense Realized gains (losses) Net Investment Income Unrealized gains (losses) Investment income Overview We actively manage our investment portfolio to achieve a balance of two primary objectives: • Cash and liquid short and med
Slide 10: Asset Management
9 As adjusted revenue components (1) Financial highlights Year-over-year improvement in pre-tax income driven by: • $2.2m of unrealized and realized gains contributed positive earnings, compared to $3.0 of unrealized losses in 1Q'16 Partially offset by: • Declining fee revenue as older vintage CLOs
Slide 11: Senior Living
10 1Q'16 1Q'17 $1.8 $2.2 Key financials (1) Highlights and outlook Improvement in pre-tax income of 61.2% primarily driven by increases in rental revenue which outpaced higher depreciation & other expenses from recently acquired properties Adjusted EBITDA of $3.0m, up 42.9% driven by improving NOI m
Slide 12: Well Positioned for 2017 and Beyond
11 Book value per share as exchanged Adjusted EBITDA Trailing Twelve Months WELL POSITIONED FOR 2017 AND BEYOND Performance is expected to benefit from: • Continued growth in specialty insurance written premiums • Improvements in long-term, net investment income as our specialty insurance investment
Slide 13: Appendix
APPENDIX
Slide 14: Non-GAAP Reconciliations - Adjusted EBITDA
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: Non-GAAP Reconciliations - Adjusted EBITDA by Segment
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: Non-GAAP Reconciliations - Book Value Per Share, As Exchanged
15 NON-GAAP RECONCILIATIONS - BOOK VALUE PER SHARE, AS EXCHANGED Management uses Book value per share, as exchanged, which is a non-GAAP financial measure. As exchanged assumes full exchange of the limited partners units of TFP for Tiptree Class A common stock. Management believes the use of this fi
Slide 17: Non-GAAP Reconciliations - Specialty Insurance
16 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 18: Non-GAAP Reconciliations - Specialty Insurance Products
17 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 19: Non-GAAP Reconciliations - Investment Portfolio
18 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 20: Non-GAAP Reconciliations - Asset Management
19 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 21: Non-GAAP Reconciliations - Senior Living
20 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