- Third quarter 2022 gross premiums written of
$844 million with split of 62% insurance and 38% reinsurance reflecting execution of strategic shift towards Insurance & Services - Strong contribution from SiriusPoint’s strategic partnerships
Third Quarter 2022 Highlights
- Net loss of
$98 million , or$0.61 per diluted common share - Combined ratio of 107.7%, underwriting loss of
$47 million - Tangible diluted book value per share decreased
$0.87 , or 7.6%, fromJune 30, 2022 to$10.58 per share - Core loss of
$75 million , which includes underwriting loss of$88 million , Core combined ratio of 114.5%, and Core net services income of$13 million - Catastrophe losses were
$115 million or 18.7 percentage points on the combined ratio - Net investment loss of
$28 million , including (3.2)% return from our investment in theTP Enhanced Fund - Annualized return on average common equity of (20.1)%
Nine months ended
- Net loss of
$376 million , or$2.35 per diluted common share - Combined ratio of 98.5%, underwriting income of
$25 million - Tangible diluted book value per share decreased
$2.69 , or 20.3%, fromDecember 31, 2021 to$10.58 per share - Core loss of
$29 million , which includes underwriting loss of$66 million , Core combined ratio of 103.9%, and Core net services income of$38 million - Catastrophe losses were
$138 million or 8.0 percentage points on the combined ratio - Net investment loss of
$375 million , including (28.2)% return from our investment in theTP Enhanced Fund - Annualized return on average common equity of (24.0)%
In addition to SiriusPoint’s third quarter financial results, the Company announces today that
“Today’s announcement and the rescaling of our property catastrophe platform is an important step in stabilizing SiriusPoint’s reinsurance business and positioning the Company for underwriting profitability in this volatile market,” Egan said. “With these actions, we provide clarity on our future priorities, our risk appetite, and our strategy to win in a competitive market. As a result of this transformation, we believe that
Egan added, “The decision to reduce our global footprint and headcount was not an easy one. It was driven by the significant, increasing effects of climate change, including under-modelled perils, and the challenges faced by the catastrophe reinsurance market, which, for consecutive years, has seen poor historical performance and inadequate returns on capital. My executive management team and I are fully committed to enabling a smooth transition for our colleagues who will be impacted by this change.”
Looking ahead, I have complete confidence in our executive leadership team and the wider Company to navigate this period of transition as we work to build a sustainable and profitable business.”
Monica Cramér Manhem, a member of SiriusPoint’s Executive Leadership team, President International Reinsurance and CEO
Additionally,
Key Financial Metrics
The following table shows certain key financial metrics for the three and nine months ended
Three months ended | Nine months ended | ||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||
($ in millions, except for per share data and ratios) | |||||||||||||||
Combined ratio | 107.7 | % | 147.7 | % | 98.5 | % | 115.1 | % | |||||||
Core underwriting loss (1) | $ | (88.3 | ) | $ | (244.6 | ) | $ | (66.0 | ) | $ | (198.1 | ) | |||
Core net services income (1) | $ | 12.9 | $ | 0.8 | $ | 37.5 | $ | 52.3 | |||||||
Core loss (1) | $ | (75.4 | ) | $ | (243.8 | ) | $ | (28.5 | ) | $ | (145.8 | ) | |||
Core combined ratio (1) | 114.5 | % | 150.2 | % | 103.9 | % | 116.6 | % | |||||||
Annualized return on average common shareholders’ equity attributable to | (20.1 | )% | (7.8 | )% | (24.0 | )% | 12.3 | % | |||||||
Basic book value per share (1) (2) | $ | 11.75 | $ | 14.46 | $ | 11.75 | $ | 14.46 | |||||||
Tangible basic book value per share (1) (2) | $ | 10.71 | $ | 13.38 | $ | 10.71 | $ | 13.38 | |||||||
Diluted book value per share (1) (2) | $ | 11.61 | $ | 14.33 | $ | 11.61 | $ | 14.33 | |||||||
Tangible diluted book value per share (1) (2) | $ | 10.58 | $ | 13.27 | $ | 10.58 | $ | 13.27 |
(1) Core underwriting loss, Core net services income, Core loss and Core combined ratio are non-GAAP financial measures. See definitions in “Non-GAAP Financial Measures” and reconciliations in “Segment Reporting”. Basic book value per share, tangible basic book value per share, diluted book value per share and tangible diluted book value per share are non-GAAP financial measures. See definitions and reconciliations in “Non-GAAP Financial Measures”.
(2) Prior year comparatives represent amounts as of
Third Quarter 2022 Summary
Consolidated underwriting loss for the three months ended
Consolidated underwriting income for the nine months ended
The lower catastrophe losses were a result of our significant reduction in catastrophe exposed business.
Reportable Segments
The determination of our reportable segments is based on the manner in which management monitors the performance of our operations. In the fourth quarter of 2021, we began classifying our business into two reportable segments - Reinsurance and Insurance & Services.
Core Underwriting Results
Collectively, the sum of our two segments, Reinsurance and Insurance & Services, constitute our "Core" results. Core underwriting income, Core net services income, Core income and Core combined ratio are non-GAAP financial measures. See reconciliations in “Segment Reporting”. We believe it is important to review Core results as it better reflects how management views the business and reflects our decision to exit the runoff business. The sum of Core results and Corporate results are equal to the consolidated results of operations.
Three months ended
Core results for the three months ended
For the three months ended
Nine months ended
Core results for the nine months ended
For the nine months ended
Reinsurance Segment
Three months ended
Reinsurance incurred a segment loss of
Reinsurance gross premiums written were
Nine months ended
Reinsurance generated a segment loss of
Reinsurance gross premiums written were
Insurance & Services Segment
Three months ended
Insurance & Services generated segment income of
Insurance & Services gross premiums written were
Nine months ended
Insurance & Services generated segment income of
Insurance & Services gross premiums written were
Investments
Three months ended
Total realized and unrealized investment gains (losses) and net investment income was
Investment results for the three months ended
Investment results for the three months ended
Nine months ended
Total realized and unrealized investment gains (losses) and net investment income was
Investment results for the nine months ended
Investment results for the nine months ended
Conference Call Details
The Company will hold a conference call to discuss its third quarter 2022 results at
A replay of the live conference call will be available approximately two hours after the call. The replay will be available on the Company’s website at www.siriuspt.com under the “Investor Relations” section.
Safe Harbor Statement Regarding Forward-Looking Statements
This press release includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding optimizing capital allocation, rebalancing towards Insurance & Services and reducing our risk profile, creating a sustainable long-term franchise and future profitability, and the anticipated effects of restructuring our underwriting platform. Forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond the Company’s control. The Company cautions you that the forward-looking information presented in this press release is not a guarantee of future events, and that actual events may differ materially from those made in or suggested by the forward-looking information contained in this press release. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “plan,” “seek,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe” or “continue” or the negative thereof or variations thereon or similar terminology. Actual events, results and outcomes may differ materially from the Company’s expectations due to a variety of known and unknown risks, uncertainties and other factors. Among the risks and uncertainties that could cause actual results to differ from those described in the forward-looking statements are the following: our ability to attract and retain key senior management; a downgrade or withdrawal of our financial ratings; our ability to execute on our strategic transformation, including changing the mix of business between insurance and reinsurance and restructuring our underwriting platform; the impact of the novel coronavirus (“COVID-19”) pandemic or other unpredictable catastrophic events including uncertainties with respect to current and future COVID-19 losses across many classes of insurance business and the amount of insurance losses that may ultimately be ceded to the reinsurance market, supply chain issues, labor shortages and related increased costs, changing interest rates, equity market volatility and ongoing business and financial market impacts of COVID-19; the costs, expenses and difficulties of the integration of the operations of
Non-GAAP Financial Measures and Other Financial Metrics
In presenting SiriusPoint’s results, management has included financial measures that are not calculated under standards or rules that comprise accounting principles generally accepted in
About the Company
Contacts
Investor Relations
clare.kerrigan@siriuspt.com
+1 441 542-3333
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
As of
(expressed in millions of
2022 | 2021 | ||||||
Assets | |||||||
Debt securities, trading, at fair value (cost - | $ | 1,697.1 | $ | 2,085.6 | |||
Debt securities, available for sale, at fair value, net of allowance for credit losses of | 1,324.0 | — | |||||
Short-term investments, at fair value (cost - | 1,991.6 | 1,075.8 | |||||
Investments in related party investment funds, at fair value | 309.0 | 909.6 | |||||
Other long-term investments, at fair value (cost - | 414.9 | 456.1 | |||||
Equity securities, trading, at fair value (cost - | 1.4 | 2.8 | |||||
Total investments | 5,738.0 | 4,529.9 | |||||
Cash and cash equivalents | 647.3 | 999.8 | |||||
Restricted cash and cash equivalents | 144.2 | 948.6 | |||||
Redemption receivable from related party investment fund | — | 250.0 | |||||
Due from brokers | 20.2 | 15.9 | |||||
Interest and dividends receivable | 17.0 | 8.3 | |||||
Insurance and reinsurance balances receivable, net | 1,952.7 | 1,708.2 | |||||
Deferred acquisition costs and value of business acquired, net | 278.6 | 218.8 | |||||
Unearned premiums ceded | 379.1 | 242.8 | |||||
Loss and loss adjustment expenses recoverable, net | 1,309.2 | 1,215.3 | |||||
Deferred tax asset | 197.6 | 182.0 | |||||
Intangible assets | 165.9 | 171.9 | |||||
Assets held for sale | 20.9 | — | |||||
Other assets | 127.4 | 126.8 | |||||
Total assets | $ | 10,998.1 | $ | 10,618.3 | |||
Liabilities | |||||||
Loss and loss adjustment expense reserves | $ | 5,200.5 | $ | 4,841.4 | |||
Unearned premium reserves | 1,572.8 | 1,198.4 | |||||
Reinsurance balances payable | 793.9 | 688.3 | |||||
Deposit liabilities | 138.9 | 150.7 | |||||
Securities sold, not yet purchased, at fair value | 41.7 | — | |||||
Securities sold under an agreement to repurchase | 17.3 | — | |||||
Due to brokers | 16.6 | 6.5 | |||||
Accounts payable, accrued expenses and other liabilities | 245.8 | 229.8 | |||||
Deferred tax liability | 66.9 | 95.4 | |||||
Liability-classified capital instruments | 48.9 | 87.8 | |||||
Debt | 762.0 | 816.7 | |||||
Total liabilities | 8,905.3 | 8,115.0 | |||||
Commitments and contingent liabilities | |||||||
Shareholders’ equity | |||||||
Series B preference shares (par value | 200.0 | 200.0 | |||||
Common shares (issued and outstanding: 162,312,938; 2021 - 161,929,777) | 16.2 | 16.2 | |||||
Additional paid-in capital | 1,633.2 | 1,622.7 | |||||
Retained earnings | 288.8 | 665.0 | |||||
Accumulated other comprehensive loss, net of tax | (53.7 | ) | (0.2 | ) | |||
Shareholders’ equity attributable to | 2,084.5 | 2,503.7 | |||||
Noncontrolling interests | 8.3 | (0.4 | ) | ||||
Total shareholders’ equity | 2,092.8 | 2,503.3 | |||||
Total liabilities, noncontrolling interests and shareholders’ equity | $ | 10,998.1 | $ | 10,618.3 |
CONSOLIDATED STATEMENTS OF INCOME (LOSS) (UNAUDITED)
For the three and nine months ended
(expressed in millions of
Three months ended | Nine months ended | ||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||
Revenues | |||||||||||||||
Net premiums earned | $ | 612.6 | $ | 499.6 | $ | 1,710.7 | $ | 1,197.1 | |||||||
Net realized and unrealized investment gains (losses) | (56.1 | ) | (11.7 | ) | (236.4 | ) | 43.7 | ||||||||
Net realized and unrealized investment gains (losses) from related party investment funds | (8.3 | ) | 202.4 | (199.8 | ) | 401.2 | |||||||||
Net investment income | 36.2 | 9.1 | 61.4 | 18.8 | |||||||||||
Total realized and unrealized investment gains (losses) and net investment income | (28.2 | ) | 199.8 | (374.8 | ) | 463.7 | |||||||||
Other revenues | 13.1 | 33.2 | 96.1 | 121.9 | |||||||||||
Total revenues | 597.5 | 732.6 | 1,432.0 | 1,782.7 | |||||||||||
Expenses | |||||||||||||||
Loss and loss adjustment expenses incurred, net | 497.9 | 577.3 | 1,198.3 | 975.1 | |||||||||||
Acquisition costs, net | 116.8 | 106.9 | 348.9 | 281.5 | |||||||||||
Other underwriting expenses | 44.8 | 53.3 | 138.1 | 120.6 | |||||||||||
Net corporate and other expenses | 70.8 | 59.9 | 220.2 | 194.5 | |||||||||||
Intangible asset amortization | 2.1 | 2.0 | 6.0 | 4.1 | |||||||||||
Interest expense | 9.4 | 9.7 | 28.1 | 24.4 | |||||||||||
Foreign exchange gains | (51.6 | ) | (16.1 | ) | (127.5 | ) | (16.5 | ) | |||||||
Total expenses | 690.2 | 793.0 | 1,812.1 | 1,583.7 | |||||||||||
Income (loss) before income tax (expense) benefit | (92.7 | ) | (60.4 | ) | (380.1 | ) | 199.0 | ||||||||
Income tax (expense) benefit | (0.9 | ) | 13.0 | 17.1 | (6.4 | ) | |||||||||
Net income (loss) | (93.6 | ) | (47.4 | ) | (363.0 | ) | 192.6 | ||||||||
Net (income) loss attributable to noncontrolling interests | (0.8 | ) | 3.4 | (1.2 | ) | 1.8 | |||||||||
Net income (loss) available to | (94.4 | ) | (44.0 | ) | (364.2 | ) | 194.4 | ||||||||
Dividends on Series B preference shares | (4.0 | ) | (4.0 | ) | (12.0 | ) | (9.5 | ) | |||||||
Net income (loss) available to | $ | (98.4 | ) | $ | (48.0 | ) | $ | (376.2 | ) | $ | 184.9 | ||||
Earnings (loss) per share available to | |||||||||||||||
Basic earnings (loss) per share available to | $ | (0.61 | ) | $ | (0.30 | ) | $ | (2.35 | ) | $ | 1.18 | ||||
Diluted earnings (loss) per share available to | $ | (0.61 | ) | $ | (0.34 | ) | $ | (2.35 | ) | $ | 1.17 | ||||
Weighted average number of common shares used in the determination of earnings (loss) per share | |||||||||||||||
Basic | 160,321,270 | 159,225,772 | 160,150,911 | 145,095,270 | |||||||||||
Diluted | 160,321,270 | 160,240,888 | 160,150,911 | 147,597,964 |
SEGMENT REPORTING
Three months ended | |||||||||||||||||||||||||||
Reinsurance | Insurance & Services | Core | Eliminations (2) | Corporate | Segment Measure Reclass | Total | |||||||||||||||||||||
Gross premiums written | $ | 318.4 | $ | 524.9 | $ | 843.3 | $ | — | $ | 0.5 | $ | — | $ | 843.8 | |||||||||||||
Net premiums written | 267.1 | 366.7 | 633.8 | — | 0.6 | — | 634.4 | ||||||||||||||||||||
Net premiums earned | 304.5 | 305.4 | 609.9 | — | 2.7 | — | 612.6 | ||||||||||||||||||||
Loss and loss adjustment expenses incurred, net | 286.3 | 217.8 | 504.1 | (1.5 | ) | (4.7 | ) | — | 497.9 | ||||||||||||||||||
Acquisition costs, net | 69.8 | 81.0 | 150.8 | (34.0 | ) | — | — | 116.8 | |||||||||||||||||||
Other underwriting expenses | 28.0 | 15.3 | 43.3 | — | 1.5 | — | 44.8 | ||||||||||||||||||||
Underwriting income (loss) | (79.6 | ) | (8.7 | ) | (88.3 | ) | 35.5 | 5.9 | — | (46.9 | ) | ||||||||||||||||
Services revenue | 3.4 | 52.5 | 55.9 | (35.4 | ) | — | (20.5 | ) | — | ||||||||||||||||||
Services expenses | — | 47.2 | 47.2 | — | — | (47.2 | ) | — | |||||||||||||||||||
Net services fee income | 3.4 | 5.3 | 8.7 | (35.4 | ) | — | 26.7 | — | |||||||||||||||||||
Services noncontrolling loss | — | 0.5 | 0.5 | — | — | (0.5 | ) | — | |||||||||||||||||||
Net investment gains from Strategic Investments | 0.3 | 3.4 | 3.7 | — | — | (3.7 | ) | — | |||||||||||||||||||
Net services income | 3.7 | 9.2 | 12.9 | (35.4 | ) | — | 22.5 | — | |||||||||||||||||||
Segment income (loss) | (75.9 | ) | 0.5 | (75.4 | ) | 0.1 | 5.9 | 22.5 | (46.9 | ) | |||||||||||||||||
Net realized and unrealized investment gains (losses) | (59.8 | ) | 3.7 | (56.1 | ) | ||||||||||||||||||||||
Net realized and unrealized investment losses from related party investment funds | (8.3 | ) | — | (8.3 | ) | ||||||||||||||||||||||
Net investment income | 36.2 | — | 36.2 | ||||||||||||||||||||||||
Other revenues | (7.4 | ) | 20.5 | 13.1 | |||||||||||||||||||||||
Net corporate and other expenses | (23.6 | ) | (47.2 | ) | (70.8 | ) | |||||||||||||||||||||
Intangible asset amortization | (2.1 | ) | — | (2.1 | ) | ||||||||||||||||||||||
Interest expense | (9.4 | ) | — | (9.4 | ) | ||||||||||||||||||||||
Foreign exchange gains | 51.6 | — | 51.6 | ||||||||||||||||||||||||
Income (loss) before income tax expense | $ | (75.9 | ) | $ | 0.5 | (75.4 | ) | 0.1 | (16.9 | ) | (0.5 | ) | (92.7 | ) | |||||||||||||
Income tax expense | — | — | (0.9 | ) | — | (0.9 | ) | ||||||||||||||||||||
Net loss | (75.4 | ) | 0.1 | (17.8 | ) | (0.5 | ) | (93.6 | ) | ||||||||||||||||||
Net income attributable to noncontrolling interest | — | — | (1.3 | ) | 0.5 | (0.8 | ) | ||||||||||||||||||||
Net loss attributable to | $ | (75.4 | ) | $ | 0.1 | $ | (19.1 | ) | $ | — | $ | (94.4 | ) | ||||||||||||||
Underwriting Ratios: (1) | |||||||||||||||||||||||||||
Loss ratio | 94.0 | % | 71.3 | % | 82.7 | % | 81.3 | % | |||||||||||||||||||
Acquisition cost ratio | 22.9 | % | 26.5 | % | 24.7 | % | 19.1 | % | |||||||||||||||||||
Other underwriting expenses ratio | 9.2 | % | 5.0 | % | 7.1 | % | 7.3 | % | |||||||||||||||||||
Combined ratio | 126.1 | % | 102.8 | % | 114.5 | % | 107.7 | % |
(1) Underwriting ratios are calculated by dividing the related expense by net premiums earned.
(2) Insurance & Services MGAs recognize fees for service using revenue from contracts with customers accounting standards, whereas insurance companies recognize acquisition expenses using insurance contract accounting standards. While ultimate revenues and expenses recognized will match, there will be recognition timing differences based on the different accounting standards.
Three months ended | |||||||||||||||||||||||||||
Reinsurance | Insurance & Services | Core | Eliminations (2) | Corporate | Segment Measure Reclass | Total | |||||||||||||||||||||
Gross premiums written | $ | 395.3 | $ | 240.6 | $ | 635.9 | $ | — | $ | 5.3 | $ | — | $ | 641.2 | |||||||||||||
Net premiums written | 289.6 | 183.9 | 473.5 | — | 5.3 | — | 478.8 | ||||||||||||||||||||
Net premiums earned | 326.4 | 160.6 | 487.0 | — | 12.6 | — | 499.6 | ||||||||||||||||||||
Loss and loss adjustment expenses incurred, net | 471.5 | 91.0 | 562.5 | (0.8 | ) | 15.6 | — | 577.3 | |||||||||||||||||||
Acquisition costs, net | 85.4 | 41.8 | 127.2 | (21.4 | ) | 1.1 | — | 106.9 | |||||||||||||||||||
Other underwriting expenses | 32.1 | 9.8 | 41.9 | — | 11.4 | — | 53.3 | ||||||||||||||||||||
Underwriting income (loss) | (262.6 | ) | 18.0 | (244.6 | ) | 22.2 | (15.5 | ) | — | (237.9 | ) | ||||||||||||||||
Services revenue | — | 37.8 | 37.8 | (25.3 | ) | — | (12.5 | ) | — | ||||||||||||||||||
Services expenses | — | 40.4 | 40.4 | — | — | (40.4 | ) | — | |||||||||||||||||||
Net services fee loss | — | (2.6 | ) | (2.6 | ) | (25.3 | ) | — | 27.9 | — | |||||||||||||||||
Services noncontrolling loss | — | 3.4 | 3.4 | — | — | (3.4 | ) | — | |||||||||||||||||||
Net services income | — | 0.8 | 0.8 | (25.3 | ) | — | 24.5 | — | |||||||||||||||||||
Segment income (loss) | (262.6 | ) | 18.8 | (243.8 | ) | (3.1 | ) | (15.5 | ) | 24.5 | (237.9 | ) | |||||||||||||||
Net realized and unrealized investment losses | (11.7 | ) | — | (11.7 | ) | ||||||||||||||||||||||
Net realized and unrealized investment gains from related party investment funds | 202.4 | — | 202.4 | ||||||||||||||||||||||||
Net investment income | 9.1 | — | 9.1 | ||||||||||||||||||||||||
Other revenues | 20.7 | 12.5 | 33.2 | ||||||||||||||||||||||||
Net corporate and other expenses | (19.5 | ) | (40.4 | ) | (59.9 | ) | |||||||||||||||||||||
Intangible asset amortization | (2.0 | ) | — | (2.0 | ) | ||||||||||||||||||||||
Interest expense | (9.7 | ) | — | (9.7 | ) | ||||||||||||||||||||||
Foreign exchange gains | 16.1 | — | 16.1 | ||||||||||||||||||||||||
Income (loss) before income tax benefit | $ | (262.6 | ) | $ | 18.8 | (243.8 | ) | (3.1 | ) | 189.9 | (3.4 | ) | (60.4 | ) | |||||||||||||
Income tax benefit | — | — | 13.0 | — | 13.0 | ||||||||||||||||||||||
Net income (loss) | (243.8 | ) | (3.1 | ) | 202.9 | (3.4 | ) | (47.4 | ) | ||||||||||||||||||
Net loss attributable to noncontrolling interest | — | — | — | 3.4 | 3.4 | ||||||||||||||||||||||
Net income (loss) available to | $ | (243.8 | ) | $ | (3.1 | ) | $ | 202.9 | $ | — | $ | (44.0 | ) | ||||||||||||||
Underwriting Ratios: (1) | |||||||||||||||||||||||||||
Loss ratio | 144.5 | % | 56.7 | % | 115.5 | % | 115.6 | % | |||||||||||||||||||
Acquisition cost ratio | 26.2 | % | 26.0 | % | 26.1 | % | 21.4 | % | |||||||||||||||||||
Other underwriting expenses ratio | 9.8 | % | 6.1 | % | 8.6 | % | 10.7 | % | |||||||||||||||||||
Combined ratio | 180.5 | % | 88.8 | % | 150.2 | % | 147.7 | % |
(1) Underwriting ratios are calculated by dividing the related expense by net premiums earned.
(2) Insurance & Services MGAs recognize fees for service using revenue from contracts with customers accounting standards, whereas insurance companies recognize acquisition expenses using insurance contract accounting standards. While ultimate revenues and expenses recognized will match, there will be recognition timing differences based on the different accounting standards.
Nine months ended | |||||||||||||||||||||||||||
Reinsurance | Insurance & Services | Core | Eliminations (2) | Corporate | Segment Measure Reclass | Total | |||||||||||||||||||||
Gross premiums written | $ | 1,220.9 | $ | 1,442.3 | $ | 2,663.2 | $ | — | $ | 2.9 | $ | — | $ | 2,666.1 | |||||||||||||
Net premiums written | 963.5 | 1,005.6 | 1,969.1 | — | 2.2 | — | 1,971.3 | ||||||||||||||||||||
Net premiums earned | 931.6 | 762.5 | 1,694.1 | — | 16.6 | — | 1,710.7 | ||||||||||||||||||||
Loss and loss adjustment expenses incurred, net | 685.5 | 506.6 | 1,192.1 | (3.8 | ) | 10.0 | — | 1,198.3 | |||||||||||||||||||
Acquisition costs, net | 236.0 | 198.4 | 434.4 | (86.4 | ) | 0.9 | — | 348.9 | |||||||||||||||||||
Other underwriting expenses | 86.8 | 46.8 | 133.6 | — | 4.5 | — | 138.1 | ||||||||||||||||||||
Underwriting income (loss) | (76.7 | ) | 10.7 | (66.0 | ) | 90.2 | 1.2 | — | 25.4 | ||||||||||||||||||
Services revenue | 3.4 | 165.9 | 169.3 | (102.9 | ) | — | (66.4 | ) | — | ||||||||||||||||||
Services expenses | — | 135.3 | 135.3 | — | — | (135.3 | ) | — | |||||||||||||||||||
Net services fee income | 3.4 | 30.6 | 34.0 | (102.9 | ) | — | 68.9 | — | |||||||||||||||||||
Services noncontrolling loss | — | 0.6 | 0.6 | — | — | (0.6 | ) | — | |||||||||||||||||||
Net investment gains from Strategic Investments | 0.3 | 2.6 | 2.9 | — | — | (2.9 | ) | — | |||||||||||||||||||
Net services income | 3.7 | 33.8 | 37.5 | (102.9 | ) | — | 65.4 | — | |||||||||||||||||||
Segment income (loss) | (73.0 | ) | 44.5 | (28.5 | ) | (12.7 | ) | 1.2 | 65.4 | 25.4 | |||||||||||||||||
Net realized and unrealized investment gains (losses) | (239.3 | ) | 2.9 | (236.4 | ) | ||||||||||||||||||||||
Net realized and unrealized investment losses from related party investment funds | (199.8 | ) | — | (199.8 | ) | ||||||||||||||||||||||
Net investment income | 61.4 | — | 61.4 | ||||||||||||||||||||||||
Other revenues | 29.7 | 66.4 | 96.1 | ||||||||||||||||||||||||
Net corporate and other expenses | (84.9 | ) | (135.3 | ) | (220.2 | ) | |||||||||||||||||||||
Intangible asset amortization | (6.0 | ) | — | (6.0 | ) | ||||||||||||||||||||||
Interest expense | (28.1 | ) | — | (28.1 | ) | ||||||||||||||||||||||
Foreign exchange gains | 127.5 | — | 127.5 | ||||||||||||||||||||||||
Income (loss) before income tax benefit | $ | (73.0 | ) | $ | 44.5 | (28.5 | ) | (12.7 | ) | (338.3 | ) | (0.6 | ) | (380.1 | ) | ||||||||||||
Income tax benefit | — | — | 17.1 | — | 17.1 | ||||||||||||||||||||||
Net loss | (28.5 | ) | (12.7 | ) | (321.2 | ) | (0.6 | ) | (363.0 | ) | |||||||||||||||||
Net income attributable to noncontrolling interests | — | — | (1.8 | ) | 0.6 | (1.2 | ) | ||||||||||||||||||||
Net loss attributable to | $ | (28.5 | ) | $ | (12.7 | ) | $ | (323.0 | ) | $ | — | $ | (364.2 | ) | |||||||||||||
Underwriting Ratios: (1) | |||||||||||||||||||||||||||
Loss ratio | 73.6 | % | 66.4 | % | 70.4 | % | 70.0 | % | |||||||||||||||||||
Acquisition cost ratio | 25.3 | % | 26.0 | % | 25.6 | % | 20.4 | % | |||||||||||||||||||
Other underwriting expenses ratio | 9.3 | % | 6.1 | % | 7.9 | % | 8.1 | % | |||||||||||||||||||
Combined ratio | 108.2 | % | 98.5 | % | 103.9 | % | 98.5 | % |
(1) Underwriting ratios are calculated by dividing the related expense by net premiums earned.
(2) Insurance & Services MGAs recognize fees for service using revenue from contracts with customers accounting standards, whereas insurance companies recognize acquisition expenses using insurance contract accounting standards. While ultimate revenues and expenses recognized will match, there will be recognition timing differences based on the different accounting standards.
Nine months ended | |||||||||||||||||||||||||||
Reinsurance | Insurance & Services | Core | Eliminations (2) | Corporate | Segment Measure Reclass | Total | |||||||||||||||||||||
Gross premiums written | $ | 931.6 | $ | 628.0 | $ | 1,559.6 | $ | — | $ | (13.9 | ) | $ | — | $ | 1,545.7 | ||||||||||||
Net premiums written | 773.8 | 468.5 | 1,242.3 | — | (19.0 | ) | — | 1,223.3 | |||||||||||||||||||
Net premiums earned | 862.8 | 334.7 | 1,197.5 | — | (0.4 | ) | — | 1,197.1 | |||||||||||||||||||
Loss and loss adjustment expenses incurred, net | 773.7 | 198.6 | 972.3 | (1.7 | ) | 4.5 | — | 975.1 | |||||||||||||||||||
Acquisition costs, net | 224.1 | 97.6 | 321.7 | (42.5 | ) | 2.3 | — | 281.5 | |||||||||||||||||||
Other underwriting expenses | 82.6 | 19.0 | 101.6 | — | 19.0 | — | 120.6 | ||||||||||||||||||||
Underwriting income (loss) | (217.6 | ) | 19.5 | (198.1 | ) | 44.2 | (26.2 | ) | — | (180.1 | ) | ||||||||||||||||
Services revenue | — | 89.9 | 89.9 | (52.6 | ) | — | (37.3 | ) | — | ||||||||||||||||||
Services expenses | — | 81.0 | 81.0 | — | — | (81.0 | ) | — | |||||||||||||||||||
Net services fee income | — | 8.9 | 8.9 | (52.6 | ) | — | 43.7 | — | |||||||||||||||||||
Services noncontrolling loss | — | 1.8 | 1.8 | — | — | (1.8 | ) | — | |||||||||||||||||||
Net investment gains from Strategic Investments | 0.3 | 41.3 | 41.6 | — | — | (41.6 | ) | — | |||||||||||||||||||
Net services income | 0.3 | 52.0 | 52.3 | (52.6 | ) | — | 0.3 | — | |||||||||||||||||||
Segment income (loss) | (217.3 | ) | 71.5 | (145.8 | ) | (8.4 | ) | (26.2 | ) | 0.3 | (180.1 | ) | |||||||||||||||
Net realized and unrealized investment gains | 2.1 | 41.6 | 43.7 | ||||||||||||||||||||||||
Net realized and unrealized investment gains from related party investment funds | 401.2 | — | 401.2 | ||||||||||||||||||||||||
Net investment income | 18.8 | — | 18.8 | ||||||||||||||||||||||||
Other revenues | 84.6 | 37.3 | 121.9 | ||||||||||||||||||||||||
Net corporate and other expenses | (113.5 | ) | (81.0 | ) | (194.5 | ) | |||||||||||||||||||||
Intangible asset amortization | (4.1 | ) | — | (4.1 | ) | ||||||||||||||||||||||
Interest expense | (24.4 | ) | — | (24.4 | ) | ||||||||||||||||||||||
Foreign exchange gains | 16.5 | — | 16.5 | ||||||||||||||||||||||||
Income (loss) before income tax expense | $ | (217.3 | ) | $ | 71.5 | (145.8 | ) | (8.4 | ) | 355.0 | (1.8 | ) | 199.0 | ||||||||||||||
Income tax expense | — | — | (6.4 | ) | — | (6.4 | ) | ||||||||||||||||||||
Net income (loss) | (145.8 | ) | (8.4 | ) | 348.6 | (1.8 | ) | 192.6 | |||||||||||||||||||
Net loss attributable to noncontrolling interests | — | — | — | 1.8 | 1.8 | ||||||||||||||||||||||
Net income (loss) available to | $ | (145.8 | ) | $ | (8.4 | ) | $ | 348.6 | $ | — | $ | 194.4 | |||||||||||||||
Underwriting Ratios: (1) | |||||||||||||||||||||||||||
Loss ratio | 89.7 | % | 59.3 | % | 81.2 | % | 81.5 | % | |||||||||||||||||||
Acquisition cost ratio | 26.0 | % | 29.2 | % | 26.9 | % | 23.5 | % | |||||||||||||||||||
Other underwriting expenses ratio | 9.6 | % | 5.7 | % | 8.5 | % | 10.1 | % | |||||||||||||||||||
Combined ratio | 125.3 | % | 94.2 | % | 116.6 | % | 115.1 | % |
(1) Underwriting ratios are calculated by dividing the related expense by net premiums earned.
(2) Insurance & Services MGAs recognize fees for service using revenue from contracts with customers accounting standards, whereas insurance companies recognize acquisition expenses using insurance contract accounting standards. While ultimate revenues and expenses recognized will match, there will be recognition timing differences based on the different accounting standards.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS & OTHER FINANCIAL MEASURES
Non-GAAP Financial Measures
Core Results
Collectively, the sum of the Company's two segments, Reinsurance and Insurance & Services, constitute "Core" results. Core underwriting income, Core net services income, Core income and Core combined ratio are non-GAAP financial measures. We believe it is important to review Core results as it better reflects how management views the business and reflects our decision to exit the runoff business. The sum of Core results and Corporate results are equal to the consolidated results of operations.
Core underwriting income - calculated by subtracting loss and loss adjustment expenses incurred, net, acquisition costs, net, and other underwriting expenses from net premiums earned.
Core net services income - consists of services revenues which include commissions, brokerage and fee income related to consolidated MGAs, and other revenues, services expenses which include direct expenses related to consolidated MGAs, services noncontrolling income which represent minority ownership interests in consolidated MGAs, and net investment gains from Strategic Investments which are net investment gains/losses from investment in our strategic partners. Net services income is a key indicator of the profitability of the Company's services provided, including investment returns on non-consolidated investment positions held.
Core income - consists of two components, core underwriting income and core net services income. Core income is a key measure of our segment performance.
Core combined ratio - calculated by dividing the sum of Core loss and loss adjustment expenses incurred, net, acquisition costs, net and other underwriting expenses by Core net premiums earned. This ratio is a key indicator of our underwriting profitability.
Basic Book Value Per Share, Tangible Basic Book Value Per Share, Diluted Book Value Per Share, Tangible Diluted Book Value Per Share
Basic book value per share, as presented, is a non-GAAP financial measure and is calculated by dividing common shareholders’ equity attributable to
Tangible basic book value per share, as presented, is a non-GAAP financial measure and is calculated by dividing tangible common shareholders’ equity attributable to
Diluted book value per share and tangible diluted book value per share, as presented, are non-GAAP financial measures and are calculated similar to the treasury stock method. Under the treasury stock method, we assume that proceeds received from in-the-money options and/or warrants exercised are used to repurchase common shares in the market. The dilutive effect of restricted shares, restricted share units and options are calculated in a manner consistent with how dilution is calculated using the treasury stock method for earnings per share. We have also followed a similar approach for calculating dilution for warrants, Series A preference shares, Upside Rights and other potentially dilutive securities issued as part of our acquisition of
The following table sets forth the of basic book value per share, tangible basic book value per share, diluted book value per share and tangible diluted book value per share as of
2022 | 2021 | ||||||
Basic and diluted book value per share numerator: | ($ in millions, except share and per share amounts) | ||||||
Shareholders' equity attributable to | $ | 2,084.5 | $ | 2,503.7 | |||
Less: Series B preference shares | (200.0 | ) | (200.0 | ) | |||
Common shareholders’ equity attributable to | 1,884.5 | 2,303.7 | |||||
Plus: carrying value of Series A preference shares issued in merger | — | 20.4 | |||||
Common shareholders’ equity attributable to | 1,884.5 | 2,324.1 | |||||
Less: intangible assets | (165.9 | ) | (171.9 | ) | |||
Tangible common shareholders' equity attributable to | 1,718.6 | 2,131.8 | |||||
Tangible common shareholders' equity attributable to | $ | 1,718.6 | $ | 2,152.2 | |||
Basic and diluted book value per share denominator: | |||||||
Common shares outstanding | 162,312,938 | 161,929,777 | |||||
Unvested restricted shares | (1,890,932 | ) | (2,590,194 | ) | |||
Basic book value per share denominator | 160,422,006 | 159,339,583 | |||||
Effect of dilutive Series A preference shares issued in merger(1) | — | — | |||||
Effect of dilutive warrants(2) | — | — | |||||
Effect of dilutive stock options, restricted shares and restricted share units issued to directors and employees | 1,963,861 | 2,898,237 | |||||
Diluted book value per share denominator | 162,385,867 | 162,237,820 | |||||
Basic book value per share | $ | 11.75 | $ | 14.46 | |||
Tangible basic book value per share | $ | 10.71 | $ | 13.38 | |||
Diluted book value per share | $ | 11.61 | $ | 14.33 | |||
Tangible diluted book value per share | $ | 10.58 | $ | 13.27 |
(1) As of
(2) As of
Other Financial Measures
Annualized Return on Average Common Shareholders’ Equity Attributable to SiriusPoint Common Shareholders
Annualized return on average common shareholders’ equity attributable to
Annualized return on average common shareholders’ equity attributable to
Three months ended | Nine months ended | ||||||||||||||
2022 | 2021 | 2022 | 2021 | ||||||||||||
($ in millions) | |||||||||||||||
Net income (loss) available to | $ | (98.4 | ) | $ | (48.0 | ) | $ | (376.2 | ) | $ | 184.9 | ||||
Common shareholders’ equity attributable to | 2,023.3 | 2,480.1 | 2,303.7 | 1,563.9 | |||||||||||
Common shareholders’ equity attributable to | 1,884.5 | 2,438.0 | 1,884.5 | 2,438.0 | |||||||||||
Average common shareholders’ equity attributable to | $ | 1,953.9 | $ | 2,459.1 | $ | 2,094.1 | $ | 2,001.0 | |||||||
Annualized return on average common shareholders’ equity attributable to | (20.1 | )% | (7.8 | )% | (24.0 | )% | 12.3 | % |
Source:
2022 GlobeNewswire, Inc., source