Slide 1: Building a world-class P&C insurer: Review of performance Q2-2012
Building a world-class P&C insurer Review of performance Q2-2012 August 1, 2012
Slide 2: Charles Brindamour, Chief Executive Officer
Charles Brindamour Chief Executive Officer
Slide 3: Q2-2012 Key points
Q2-2012 Key points Second quarter highlights • Net operating income per share of $1.35, 55% higher than Q2-2011 • Combined ratio of 92.3%, as strong broad-based results were partially offset by elevated catastrophe losses • Top line growth of 46%, reflecting strong retention of the AXA Canada portfo
Slide 4: Industry outlook for 2012
Industry outlook for 2012 We remain well-positioned to continue outperforming the Canadian P&C insurance industry in the current environment • Industry premiums are likely to grow at the same rate in H2-2012 – Mid single digit growth in personal auto – Upper single digit growth in personal property
Slide 5: Conclusion
Conclusion • Key takeaways: − Combined ratio of 92.3% in Q2 despite more than $60 million of catastrophe losses during the quarter − AXA integration is on track − JEVCO close targeted for the fall, pending regulatory approvals Given the quality of our operational platforms, the flexibility provided
Slide 6: Mark Tullis, Chief Financial Officer
Mark Tullis Chief Financial Officer
Slide 7: Financial highlights
Financial highlights (in $ millions, except as otherwise noted) YTD YTD Q2-2012 Q2-2011 Change Change 2012 2011 Direct premiums written 1,977 1,354 46% 3,380 2,297 47% Underwriting income 123 33 273% 246 91 170% Combined ratio 92.3% 97.0% (4.7) pts 92.3% 95.8% (3.5) pts Net operating income per shar
Slide 8: Improved results in personal lines
Improved results in personal lines (in $ millions, except as otherwise noted) Combined ratios Personal Auto Q2-2012 Q2-2011 Change 89.0% 85.7% Direct premiums written 907 674 35% 27.7% 26.4% Underwriting 61.3% 59.3% 82 79 4% income Q2-2012 Q2-2011 Combined ratio 89.0% 85.7% 3.3 pts Claims ratio Expe
Slide 9: Commercial lines growth solid
Commercial lines growth solid (in $ millions, except as otherwise noted) Combined ratios Commercial auto Q2-2012 Q2-2011 Change 79.6% 75.4% Direct premiums 32.8% 31.9% 159 108 47% written 46.8% 43.5% Underwriting income 26 21 24% Q2-2012 Q2-2011 Combined ratio 79.6% 75.4% 4.2 pts Claims ratio Expens
Slide 10: High quality investment portfolio
High quality investment portfolio Net investment gains (losses) $11.7 billion in investments (in $ millions, except as otherwise noted) Cash and short term notes, 5% Loans, 4% Debt Securities Q2-12 Q2-11 Change Common shares, 9% Gains (losses) on fixed-income (1) (1) - securities & related derivativ
Slide 11: Financial position remains solid
Financial position remains solid • Our financial position remains solid with $649 million in excess capital and an MCT of 205% • Book value per share of $30.30 increased 13% from a year ago − Decline from Q1-2012 was due to negative impact on OCI from declining interest rates and weak equity markets
Slide 12: AXA acquisition update
AXA acquisition update • Integration is on track − 600,000 personal lines policies and 80,000 commercial lines policies already converted • We continue to target $100 million in annual after-tax synergies − $37 million run-rate at June 30, 2012 − Targeting $50 million run-rate by the end of 2012 • $
Slide 13: Strategic, operational and financial strength
Strategic, operational and financial strength • Largest P&C insurance provider in Canada • Solid financial position • Excellent long-term earnings power • Organic growth platforms easily expandable Disciplined pricing, underwriting, investment and capital management have positioned us well for the f
Slide 14: Forward looking statements and disclaimer
Forward looking statements and disclaimer Certain of the statements included in this Presentation about the Company’s current and future plans, expectations and intentions, results, levels of activity, performance, goals or achievements or any other future events or developments constitute forward-l
Slide 15: Forward looking statements and disclaimer
Forward looking statements and disclaimer Disclaimer This Presentation does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities nor shall it or any part of it form the basis of or be relied on in connection with, or act as any inducem
Slide 16: Q3-2012 earnings call, Wednesday, November 7, 2012
Building a world-class P&C insurer Q3-2012 earnings call Wednesday, November 7, 2012