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| Clare Kerrigan | Head, Investor Relations |
| Sid Sankaran | Chairman & Chief Executive Officer |
| David Junius | Chief Financial Officer |
Good morning, ladies and gentlemen, and welcome to the SiriusPoint Limited First Quarter 2022 Earnings Conference Call.
During the presentation, all participants will be in a listen-only mode.
As a reminder this conference is being recorded. I would now like to turn the call over to Ms. Clare Kerrigan, Head of Investor Relations for SiriusPoint. ahead. go Please
available Welcome and the Operator. issued SiriusPoint Earnings Junius, Sid Financial which Limited earnings me Chief www.siriuspt.com. Thank today our Executive here quarter to Officer; of for are are supplement, financial first release our we our XXXX. Call website, press With Chairman you, Sankaran, and the on Chief Last Officer. our David night, and
contain as the forward-looking would I to XX, you earnings remarks like recent these expectations. will find today XXXX, of results filings, to release cause and from company's will the risk including factors of press based Before differ that we begin, Form other risks results from the Actual statements that remind Please current the a on materially for materially could to differ many refer public December certain uncertainties. where the XX-K actual may those forward-looking result you and ended statements. period projected
In press for a Sid. available to addition, comparable is the allow financial understanding the the of these call measures management complete our results. this earnings to is to presented over certain measures, I company's which At will measure non-GAAP management company's time, most non-GAAP reconciliation more release believe of financial that GAAP will A on in refer website. turn the
in significant profitability positive exists the to of as in everyone. unlock year company. business. exposure catastrophe re-underwriting and morning platform challenges we we and a mix progress products. priorities in our good XXXX launched risk to legacy in business quarter pleased achieve shift outlined A complete insurance When our towards showed reinsurance our one laid the strategic that XXXX extremely expertise a potential on other reduction capital, launched, out business. address transform that and plans ago through I'm Clare, to you, Thank with our and continue underwriting we to the SiriusPoint first of to we execute the
is the achieved quarter has side, meaningfully derisking million ratio the a a This profit reflects a the first we with XX.X% We investment gross portfolio. since quarter of premiums that and underwriting the written of consolidated on Finally $XX that of then. work asset for over intended combined been undertaken $X of just our hard billion.
showed and in Our our momentum services insurance the strategic this evidenced results approach traction towards promising quarter profitability. gains progress our and segment shift as with growth partnerships by deliberate and premium
execute in reinsurance primarily improved disappointing on and portfolio by Point results said, of results as ruthlessly re-underwriting fronts. progress That Enhanced continued. losses segment quarter, this I'm pleased on extremely our reduce our We on these last both our were the investment the also quarter's Fund. our our risk steps in Third to driven in
like program derisking dive deeper our to investment a quarter. coming continue execute I'd our on little We to the in progress.
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discount value, authorization. with repurchase in we book March common material stock repurchased to $X million in million the share Given $XX our of remaining
we program share quarter-to-quarter. repurchase will value, is continue review to and within services the creating segment. of Much are We our insurance our
likely for the increasingly partner are towards businesses. of of innovative disruptive platform, be partnerships for the that relationship strategic in actuarial and agents. from to segment. believe for and success. to global alignment and business for often for businesses, general in small while insurance our our and management in establish advantage largely our shareholders strategic extensive underwriting including entrepreneurialism in This our the partnership We underwriting SiriusPoint within driven driving a our to competitive our towards traditional or regulated and differentiating industry. managing value in provide identity We shifting as believe can value sustainable of more paper is finally sheets. create mutual positioning and these is future. access growth product variety change rebalancing incentive fronting, value-add multiyear offering those a insurance company our balance is key the We that MGAs, and our capital, expertise, both by to talent transformation a reinsurance We distribution, We supporting more differentiating insurance both much model MGA create provide of success strong best The is services allows reinsurer, ways. We first developed the fronting development organizations entrepreneurial creation. SiriusPoint's value and model to is gravitating technology with our working typical
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youth relatively point and/or Players insurance where MGAs their capital, offering and insurer; arrangements. sports make we an function early investment, Honeycomb, partner and at Corvus, we generally with in Secondly, real offering These a amateur start-up maturity which insurer Health, provides insurance; technology-enabled management; include and commercial a risk Vouch. cyber paper, estate
insurance. are our to and subsidiaries and Modicare travel MGAs Health our assistance developed most Employee established International Finally, and or Medical which and owned with which we provides Group provides increased Solutions have our contributions and quarter. growth Benefit wholly this supplemental income IMG, medical These
modest With and our renewals during either to modest XXXX. Following continued employees value benefit a trend benefits benefits, of an opted the scheduling post-COVID increased and to in season an to health quarterly good Perhaps profitability a many normalcy employee in surgeries back offering employees we're in to have impacting following positively seen programs, going our the seen set we've very doctor, use results. supplemental their continued their products. increase the elective our renewal leading modest or restrictions, return using customers add
challenging returned to travel same also $X.X strong million the momentum in XXXX year. are a seeing leisure breaking last quarter reductions. strong in in with versus quarter the levels, seeing recovery after and due XXXX we're to travel We pre-pandemic by even COVID-related of in Driven first results IMG's income travel
continued we a aggregators medical With the digital expensive the and IMG's travel SiriusPoint buy to for quarter opportunity to insurance approach effective the generating for and trips pre-pandemic the generated longer platform higher XX.X%. are insurance direct SiriusPoint's our grow than a sheet product travelers more to business' within on combined at balance merchandising performance in strong segment. taking in of program, resulting and this invest continue ratio accessing key distribution. is norms, while to rate Leisure via choosing market IMG's by and IMG marketing
SiriusPoint's syndicate in with Our designed XXXX. to Lloyd's partnership Mosaic is Insurance reinvigorate
with As point product the managing XXXX, a acquire second we half a XXXX. Mosaic's to arrangement This and best-in-class anticipate serious will offers the to path Mosaic classes and also part of in and regulatory subject of agency, growing underwriters. to growth creates reach geographic SiriusPoint a the while providing partnership development unique Lloyd's syndicated retains which that approval, access
is alignment to to Separately, Mosaic choices rankings XXXX a being second due in continue in on which with the business revaluation, reflective Lloyd's remediation our write. entire Syndicate to fourth improve the Our year the the tough innovation making while business last improved board. the includes stake business to we work seat and underwriting of the on the taking in their a focused to and from quartile applied
invest insurance digital include and carriers. in support specializing the and These addition Buddha, a for ecosystem. Broker insurance that commercial in missions LuckyTruck, the platform aggregator service to we a and brokers, the commercial trucking providers MGA In insurance simplifies MGAs partnerships, MGA high-value that broker
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We leverage and adequacy, opportunity provides established us great intend global for to platform opportunities all approach to within which we access to and disciplined risk we of global growth nimble have position appetite. which have our a to an and market local long-term
Russia for reinsurance the a $X and combined XX% Ukraine estimate a but segment ratio. loss reinsurance loads segment, catastrophe for the quarter Ukraine-Russian catastrophe and losses premiums budgeted re-underwriting and of restatement ongoing $XX our million for with and $XXX will million and within income David substantial net was losses in specific million and our current written $X falls premiums Following quarter. reallocation with our this which of the of includes our modest underwriting combined cat of million, address
still continue with closely non-renewed case impact across on Ukraine-Russia the the the changes and still $XXX of generally, to impact reflecting XX in business segment our economic for approximately major exited of having tragically this compliance and conflict. portfolio. is unfold war conflict reinsurance More in situation The applicable As across million re-underwriting markets, ensure monitor economic monitoring the human to of uncertain. this major remains in cost. the is closely potential in the our business or and terms we've We'll our months, consequences full businesses last ultimate made unfolding sanctions. insurance of we're full The
an We We violence, risk anticipate XX%, the payrolls we portfolio our from out facultative property continue by concerns reduced a our office. than view property and we We've XXXX. as We written direct property cat-exposed our select London additional transactions actions and prudent regions the and rate. as US where thresholds the Cyber risk Point where Comp presented as Workers' pro secondary re-underwriting is or exited heightened as risk global transactions property exited aggregates and of overall well Third renew legacy as a by War, there previously more more throughout about political and pullback well had and of cap, perils. risks most book refloat inherent rata, and pricing catastrophe adequate Bermuda
to replaced rata We acquisition and also by casualty significant US volume exited accounts. in accounts expect structured our we cost which business, portfolio a pro higher commodity niche outperform of
portfolio, cycle as our process is distribution re-underwriting seeding scrutiny deal well target economics continuous Our the other structure, company. a with across account-by-account including and including factors viewed as the and the market
where with the deteriorating where for portfolio of or position or prefer current improve business. non-commoditized scrutiny our increased reinsurance to We has cycle are have accounts and market flagged more niche at approximately conditions likely our we XX% and generally including non-renewal peaked
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growth-oriented to in maintain year should wind and discipline favorable. we Repositioning have to we due returns priority technology property the option unless especially X/X in such to negative more Enhanced top top lower-cost our The our and reinsurance operational However, response up and underwriting be is This fund, conditions model for driver led shifting the at have with results fundamental aggregates retained taking price aggregates stable and for us. loss traction so $XXX disappointing an the pressures address the confidence retrocession is the that avoid the the and positions deploying market investment this primarily the with operating Point our strategy to ability pressing and and returns key a global to flex steps sustainable reinsurance line as strategy the our issue. committed in by Atlantic the given remains long results terms this for is the of sector. remain We later overall fixed of associated adequacy The the for very financial deploy made pricing the high to line risk-reward main expenses. of are we enterprise in down have avoiding business. the or investment more profile ongoing we in includes net quarter. portfolio in nimble and This equities return we've to progress to and our million Third
extreme Point Point with capital volatility fund to end investment have to XXXX. last amended quarter, quarter Third withdrawals year. experienced the agreement that we further in last our we coming and Enhanced quarter, following during fourth levels at we from LLP million eliminate As XXXX reported investment the of management redemptions the of from Third reallocating aggressively are the redemption We of TP of the intend over million of continue the execute $XXX in funds. the on quarter and the $XXX Redeemed
space. both and partnership financials. to credit however Third to over Point hand extremely through take opportunities I the be about now will continue We David to call with managed excited us in the TP venture the
Thanks, Sid.
of first million net or For diluted versus the quarter, we generated the a ago. million loss diluted $XXX of $XXX year quarter a or per net $X.XX in same income share $X.XX per share
and This launched quarter Our reflecting marking since $XX We underwriting the basis reporting a is million, ratio of an an annualized five with our a XX.X%. return in quarters, with the Runoff including or core we negative the million and the equity on SiriusPoint. of Core are to before as in consolidated of eliminations. the structure combination core results remaining segment and the distribution a with contribution show basis, underwriting, our underwriting reinsurance define platforms results. new insurance former gross intercompany each income net which reported segment under of $XX achieved XX.X%, profit fourth common we average of quarter was quarter services underwriting a the and profit quarter-over-quarter, improvement out income combined services, our on point presented of XXX corporate the second
of as the the operated if company parts So two independently.
in on and and our strategy the in structure services is fee the The transformation our stakeholders fee-driven our underwriting business, As our evaluate as company's core MGAs, as as which and presentation profit of believe of underwriting greater transparency This on and we as partnerships. from contribution segment. We growth better this the income. change, well separately broken net combination core part the Insurance reinsurance business investments investments strategic expenses, in and from returns well our a our provides the out income. with transparency parts and our gains into income core of from as to and of provides Services reminder, losses have management this service income reflects
found and XX.X% to a million at ratio as the XXXX, last compares of in our and the of only of first on $XX XXXX, ratio combined a segment combined which $XX presentation can $XX including included Core quarter first of from for was XX.X%, a million, closed partial which Sirius Group detail of our of Form million income segment income XX-Q. acquisition quarter Additional the end be in results year. underwriting the February
current action reserving cat floods. near European windstorm reinsurance highly situation coverage evolving and streets to losses including Russia violence at with Ukraine. as whole year $X includes we combined events Core excluding was taken despite cat activity not Russia net million bad Russia driven partially Our quarter leased to philosophy, be political with Ukraine. having including prior ultimate still driven benign provision loss contracts and being a cases, exposure our million underwriting were points, unknown offset despite in planes $XX and exposures ratio reported this losses of the work and many Russia Russian of million with we've elements losses or uncertain. have believe cat our exposure loss news or million and any losses and by development, and reserving outcomes Russia-Ukraine losses an in points reserved by for number On $XX line X.X by as recognizing X.X Ukraine. cat what In exposure, favorable we income $X Outside Ukraine, aviation quickly, Ukraine, with on limited to Australian in and well a our of or net February
a contract Australian has reserve Australia, this that our flooding. core a to we historic single For net have on full established
slightly to across the track cat on quarterly cat mentioned, Ukraine prior loads profit of include budgeted development us results losses, keeping Sid deliver The favorable are and million including year areas. full year. As below three Russia $X for net
reserving from prior A&H out and Accident contracts. First, benefit our favorable books, accident both book, to was prior we and in to our year in years number with individual reserves where prudent international continue year of & development taken close across Health a US action
action of COVID coming we as contracts, a see us as overall positions area continue on release reserving level of loss our below the individual on well reserves portion we allowed which contract an a to to ultimate our margin COVID picks. portion actuals to Second, took reserves release specific our management where
offsetting wait development, development losses coming long-tail to had expected favorable trends due material higher this in except we above on property costs. partially labor adverse Third, due see to cedent all are not this the as comp, favorable actual margins. in versus workers' we rates we reserves to we volumes book take and reported to classes did related expectations exposures loss positive building in on continue pressure to skilled quarter, On overall our which Despite lines within for and trend, reserving season. despite developing these action
continue than one by not written were XXXX book do year pricing prior book, only entire with our our premiums comparisons first relevant quarter billion. particularly higher We Group the We as given Core the as levels of particular of business casualty partner gross first included month across quarter attention results. MGAs. to Sirius to growing $X at reserves for written view
forma mix profitability. waiting year-over-year. respectively reflects our insurance volatility on our This an and business to to our reduce premiums pro gross from written business reinsurance and XX% estimated growth underwriting basis shifting strategy premiums X% grew However, improve earnings of written net
with shift Our business is mix and premiums gross shift XX-point from premiums written XXXX. emerging net a quickly written
$X Turning impacted to Insurance Reinsurance Reinsurance results income quarter more were losses and million XX.X% underwriting $XX.X in the of million detail. million than in respectively. losses or of results with Russia-Ukraine Services individual segment. ratios segment produced the four combined more and aforementioned the by XX.X% $XX of segment from The and of to the and points
segment $XXX rising predominantly revenue are one-third larger positive were primary of the million Insurance across lines focus and gross stronger accident $XX commodity IMG portfolio, margins development continued Net from our net in offset A&H, commissions. seeding casualty with and versus million $XX underwriting benefited portfolio a approximately income of income and lines stronger to primarily been and segment a prior rating from niche saw written million ratio in by our environment Accident MGAs, property, contributed Insurance counts, by $XXX increases produced steady where two-thirds and $XX from income outperformance IMG expenses services year, included on services business combined IMG, million, mix and good with compared where profit of organic partially boosted Beyond American recovery prior of and across services has travel $XX Armada Health our million of Insurance in underwriting of commercial seeing favorable in P&C. & the revenue million, Arcadian strong premiums we together to profit reinsurance and specialty prudently. benefited a growth. flow a year Services the Banyan. our year, new health A&H a versus In Net expansion. we consisting of and Armada's portfolio lines our continue reserve reflecting remains portfolio premium $XX North and by to and and services million a lower-than-planned services margin XX.X%. income most services prior
business was well, as by the expected. New is written North running portfolio American
an Core where quarter to our and OUE insurance. of the the fourth year-on-year, cyber top-tier strong in as $XX our as strong for X.X% continue the were expenses with portfolio the imbalances international partnership very quarter. million market following Banyan XXXX, we see Our had launch Arcadian in with supply A&H, level. well first or contributors MGAs Overall ratio. performed to for are for demand Corvus, line we growth has underwriting in which were pleased quarter historically production of and XXXX
$XX and in to is the growing expected expenses, and Florida. A&H provisions driven reinsurance efficiency largely million, of Corporate exposures book. elevated investing credit are $XX million to reinsurance by in gains We our Russia by MGA our quarter, for losses offset due which portfolio, excluding were service in expenses,
in with ended of Excluding the to $XX for item quarter for million due with political Corporate loss generated expenses an XXXX, million corporate this islands exposure re-underwriting, one-time XX, contract portfolio quarters. The booked received the risk-attaching prior yet $X March underwriting we were last a line three quarter year as we which loss, was have though formal to and a investment Ukraine, our notification. had was loss net for part not related to last a XXXX, the million, largely where months driven our non-renewed quarter Enhanced even of the have XXXX. from Point nine above income. in fourth our of mix of reiterate our quarter $XXX investment to the target reversed return XXXX by gains our investments fixed And million, XQ the first commitment of months from we from XX.X%. losses we party funds and of in related in The hedge party investments Third the $XXX XXXX fund, negative in the shifting our TPE bulk of first first was
the million incorporating redemption reported million end the was of in Third balance Point $XXX $XXX previously the quarter million, $XXX January end XXXX. quarter at redemption and Enhanced of Our fourth the
In continue be and our other down to to addition, this we subject portfolio to XX% on $XXX redemptions portfolio, year-end legacy sales, alternatives continues to directions. Group since Sirius exit gating and although million
our we fair driven for fair portfolio, further market to publicly investments investments our by part which MGAs performance have taken large have our The of value operating changes value, new where from underlying business held strategic of expectations. in for the away underlying portfolio. to traded we indicative in positions in peer continue groups, market We necessarily perform of action move privately performance to are believe accounting not the the
cash positioning, short-term rate our despite the excluding under approximately or and the as enable of in to X.X cash funds was income as environment, spreads Our impacted rate a benefit and first million the duration portfolio positioned interest as as also rising loss short-term at will have Widening at had $X.X liability from the from to return portfolio, billion fixed quarter, of company This A just a three a well deploy fixed of to relative cash duration income away years, equivalents, returns. an investments, quarter hedge investments, in funds. $XX we credit allocation our X%. increase we years. inclusive
Although, debt we par duration expect pull portfolio residential led short the maturity, the declines. and corporate to MBS towards this
is in remains was debt-to-total debt unchanged sheet our for billion ending the of quarter, in extremely SEK balance Our $X.X strong, Issued shareholders' capital FX capital equity. debt Total our quarter changes sub the $X.X ratio billion. except debt with our including was up in have one the all book insurer strength diluted per to XX% XX% Fitch point AM equity. of Since change fell on share year, quarter. and Best start the the S&P, value in A- the financial Tangible ratings. reaffirmed
Now, to remarks. turn Sid the let for concluding call me back
David. Thanks
opportunities We and have they positive to momentum of advantage as as well we arise. head positioned midyear towards are take
across our to and I'm of what is Our commitment achieved and immensely platform to progress so and growth. business segments for value creation. sustainable far is testament the team's being long-term position tireless to profitability our us development transformation, proud
priorities And time. our presents. and Our delivering underwriting that call but are to services remains volatility with value do, differentiation business. market insurance committed and I'll growing work There developing aiding for back focus over that our the have doubt your considerable on to of and opportunity, proposition reducing you our we strategic investment across our understanding profitability, portfolios to underwriting no turn against the and the to is we operator. Thank
concludes teleconference. This today’s
may Thank lines at participation. for you your disconnect your You this time.
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