Investor Presentaiton
SKYWARD SPECIALTY - SUMMARY STATEMENTS OF
OPERATIONS (1)
Three months ended
Year ended
December 31
December 31
(Currency amounts in millions of US$)
2021
2020
2021
2020
Gross written premium (GWP)
Net written premium (NWP)
$224.2
141.0
$196.4
114.8
$939.9
529.1
$873.6
461.5
Net earned premium
$133.8
$116.5
Commission and fee income
1.3
0.9
$499.8
3.9
$431.9
5.7
Less: Losses and LAE excluding LPT(2)
(88.5)
(78.4)
(338.3)
(302.4)
Less: Policy acquisition costs
(16.4)
(12.8)
(47.1)
(37.0)
Less: Other operating expenses (2)
(23.1)
(21.9)
(91.4)
(84.5)
Underwriting result excluding LPT(2)
$7.1
$4.3
$26.9
$13.7
Net investment income
Net realized and unrealized gains
Investment income
4.0
4.1
24.6
7.1
9.1
17.1
14.3
0.1
$11.1
$13.2
$41.7
$14.4
Interest expense
(1.2)
(1.2)
(4.6)
(5.5)
Amortization expense
(0.4)
(0.2)
(1.5)
Income before taxes excluding unusual items
$16.6
$16.1
$62.5
(1.4)
$21.2
Income tax expense
3.4
3.5
13.0
Net income excluding unusual items
$13.2
$12.6
$49.5
Impact of LPT, net of tax
(12.7)
(3.6)
(12.7)
Other net recovery of expenses, net of tax
0.8
3.6
3.7
1.3
Goodwill and other intangible impairment, net of tax
(45.5)
(2.2)
Net income (loss)
$1.3
($32.9)
$38.3
(45.5)
($74.6)
Total other comprehensive (loss) income
(2.1)
0.4
(7.6)
7.2
Comprehensive (loss) income
($0.8)
($32.5)
$30.7
($67.4)
Other Select Financial Information
Loss ratio excluding LPT(2)
Expense ratio
Combined ratio excluding LPT(2)
Combined ratio excluding LPT and CAT(2)
4.4
$16.8
(47.2)
66.2%
67.3%
67.7%
28.5%
29.0%
26.9%
70.0%
26.8%
94.7%
92.8%
96.3%
95.6%
94.6%
92.2%
96.8%
95.8%
Written Premium Growth
Skyward Specialty is focused on being a disciplined gross line underwriter, earning
an underwriting income on a gross and net basis
GWP increased 14.2% in Q4 2021 vs. Q4 2020 and NWP increased 22.8% in Q4 2021
vs. Q4 2020; GWP increased 7.6% in FY 2021 vs. FY 2020 and NWP increased 14.6%
in FY 2021 vs. FY 2020
GWP increase for the continuing business, which excludes business exited by the
company as its portfolio was repositioned over the past two years, was 37.7% in Q4
vs Q4 2020 and 33.9% in FY 2021 vs FY 2020
We believe the growth of the continuing business, which is now 96.9% of the Q4
2021 and 92.3% of the FY 2021 GWP, are leading indicators of future margin
expansion given the earnings profile of continuing business compared to those
discontinued
Underwriting Profitability
Underwriting result excluding LPT was $7.1 million in Q4 2021 vs. $4.3 million in Q4
2020; $26.9 million in FY 2021 vs. $13.7 million in FY 2020
The combined ratio of 94.7% in Q4 2021 improved vs. to 96.3% in Q4 2020 despite
higher catastrophe losses; 94.6% in FY 2021 compared to 96.8% in FY 2020
Strategic actions taken over the past year are reflected in the combined ratio
excluding catastrophes of 92.8% in Q4 2021 compared to 95.6% in Q4 2020; 92.2%
in FY 2021 compared to 95.8% in FY 2020
Investment Performance
For Q4 2021 the investment portfolio performed solidly, generating $11.1 million of
investment income in Q4 2021 and $41.7 in FY 2021 as the investment portfolio
strategy has been enhanced
Other Items
Other comprehensive loss of $2.1 million ($7.6 million FY) relates to the after-tax
change in the carrying value of the fixed income portfolio
(1) FY2020 adjusted to conform to the presentation of the current period financial statements including restatement of comprehensive loss of $32.5 million and $67.4 million for the three months and year ended December 31, 2020, respectively, compared to the previously reported
comprehensive loss of $30.4 million and $64.7 million for the three months and year ended December 31, 2020, respectively. For further details refer to the Skyward Specialty's consolidated financial statements with independent auditor's report as of and for the years ended
December 31, 2021 and 2020 filed on SEDAR by the The Westaim Corporation.
15
(2)
Does not include charges related to the Loss Portfolio Transfer ("LPT") transaction completed in Q1 2020, development subject to LPT or other unusual items. See Westaim's Q4 2021 MD&A for details.View entire presentation