Aventus Capital Inc. · TSXV:AVTS
Aventus Capital — The Westaim — Q4 2023 Earnings Presentation
35 slides from Aventus Capital's earnings presentation, Mar 27, 2024
Slide 1: Q4 2023 Investor Presentation
Q4 2023 Investor Presentation March 27, 2024
Slide 2: Disclaimer
Disclaimer Safe Harbour Statement This document and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part either directly or indirectly without the prior written consent of each of The Westaim Corporation (“Westaim” or the “Corporation” or t
Slide 3: Disclaimer
Disclaimer Safe Harbour Statement Supplementary financial measures concerning the Arena FINCOs and Arena (the “Arena Supplementary Financial Measures”) contained in this presentation are unaudited and have been derived from the audited consolidated financial statements of the Arena FINCOs and Arena
Slide 4: Important Disclosures
Important Disclosures Non-GAAP Measures Westaim Westaim reports its consolidated financial statements using Generally Accepted Accounting Principles (“GAAP”) and accounting policies consistent with IFRS. Westaim uses both IFRS and non-generally accepted accounting principles (“non-GAAP”) measures to
Slide 5: Important Disclosures
Important Disclosures Arena With respect to the section on Arena the information therein is being provided solely in relation to the management company and the investment manager, including their funds, subsidiaries and affiliates. Returns shown are unaudited. Past performance is not indicative or a
Slide 6: The Westaim Corporation
The Westaim Corporation The Westaim Corporation Westaim is a publicly listed (TSXV:WED) Canadian investment holding company specializing in providing long-term capital to businesses operating primarily within the global financial services industry. Our focus has been, and continues to be, to seek hi
Slide 7: Westaim Q4 2023 and FY 2023 Operating Highlights
Westaim Q4 2023 and FY 2023 Operating Highlights Westaim's Q4 2023 and FY 2023 earnings continue to be driven by gains on its Skyward Specialty ownership • Q4 2023 Net Income attributable to AIGH (100%) was $1.1 million compared to Q4 2022 Net Income attributable to AIGH of $0.3 million; FY 2023 Net
Slide 8: Westaim Summary Q4 2023 and FY 2023 Operating Results
Westaim Summary Q4 2023 and FY 2023 Operating Results • Profit and comprehensive income for Q4 2023 was $35.1 Three months Year ended million ($0.26 diluted earnings per share) compared to a profit ended December 31 December 31 and comprehensive income of $32.8 million ($0.23 diluted (Amounts in mil
Slide 9: Westaim Summary Statement of Financial Position
Westaim Summary Statement of Financial Position As at December 31, 2023 September 30, 2023 December 31, 2022 • Book value per fully diluted share increased $1.27 (49.6%) to $3.83 at December 31, 2023 from $2.56 at December 31, (Amounts in millions of US$ except per share data) 2022. Book value per f
Slide 10: Westaim Diluted Earnings per Share: Three months ended December 31, 2023
Westaim Diluted Earnings per Share (US$): Three months ended December 31, 2023 10
Slide 11: Westaim Book Value per Share: Three months ended December 31, 2023
Westaim Book Value per Share (US$): Three months ended December 31, 2023 11
Slide 12: Westaim Diluted Earnings per Share: Year ended December 31, 2023
Westaim Diluted Earnings per Share (US$): Year ended December 31, 2023 12
Slide 13: Westaim Book Value per Share: Year ended December 31, 2023
Westaim Book Value per Share (US$): Year ended December 31, 2023 13
Slide 14: AIGH global financial institution overview
All data is as of December 31, 2023 unless otherwise specified AIGH, including its joint ventures and affiliates, is a global financial institution with over 150 people across 8 global offices and operating in over 20 countries
Slide 15: About Arena
About Arena 15 • Credit-oriented, asset backed-orientated investments, but not “traditional private credit”. ABOU T ARENA ( 1 ) • Broad Platform – capabilities across Corporate, Real Estate, Structured Finance, and Corporate Securities allow the firm to find the most compelling opportunities across
Slide 16: Arena – Key Highlights
Arena – Key Highlights 16 • Arena is a growing global financial institution • Mandate flexibility and diversification contribute to consistency across cycles Differentiated Approach • Proprietary sourcing and global infrastructure with a focus on small size • Servicing and systems that govern proces
Slide 17: Arena – Q4 2023 Quarterly Result Highlights
Arena – Q4 2023 Quarterly Result Highlights 17 (dollars in millions) Q4 2023 Q4 2022 FY 2023 FY 2022 Q4 2023 Results: Arena Investors • Net income for Q4 2023 was $1.1 million (Q4 2022: $0.3 million) Management fees $ 7.6 $ 8.3 $ 30.8 $ 31.9 Asset servicing fees 2.7 2.3 11.0 10.6 • Management fee re
Slide 18: Arena – Investment vehicles
Arena – Investment vehicles (1) 18 $ 3 . 2 B A U M (2) Permanent Capital (Arena FINCOs) EXCESS CA PACI T Y OPP ORTUNI TI ES • Arena Finance $0.9B A R E N A F U L LY D I V E R S I F I E D • Arena Origination Company Open-ended Evergreen Funds New Zealand S T R AT E G Y $ 2 . 0 B • Arena Special Oppor
Slide 19: Arena – Investing: Performance & Deployment (drawdown funds)
Arena – Investing: Performance & Deployment 19 • The following table presents the performance data for the significant drawdown funds and accounts: As of December 31, 2023 Year of Original Capital Capital Invested Realized Unrealized Total MoIC2 IRR3 Primary Investment AUM ($ in millions) inception
Slide 20: Arena – Investing: Performance & Deployment (open-ended funds)
Arena – Investing: Performance & Deployment 20 • The following table presents the performance data for the significant open-ended funds and Stable Income strategies: As of December 31, 2023 Returns (%) Since Inception Year of Quarter-to-date Year-to-date Primary Investment Strategy AUM (Annualized)
Slide 21: Arena – AUM Through December 31, 2023
Arena – AUM Through December 31, 2023 21 • Arena’s AUM (including undrawn commitments) were $3.2B at December 31, 2023. From December 31, 2015, to December 31, 2023, AUM has grown at a CAGR of ~40%. AUM temporarily decreased due to the return of capital from vehicles that are in their redemption per
Slide 22: Arena – Deal Structure Aligns Arena Management and Westaim
Arena – Deal Structure Aligns Arena Management and Westaim • Arena was founded by Dan Zwirn and Westaim in August 2015 under an arrangement designed to align Arena’s senior management interests very tightly with those of Westaim and its shareholders. The principal elements of the arrangement include
Slide 23: Arena
fs ARENA
Slide 24: Arena FINCOs: Summary of Operating Results
Arena FINCOs: Summary of Operating Results Three months ended Year ended December 31 December 31 • Q4 2023 Net Loss was $0.9 million (-0.5% net investment return) compared to Q4 2022 Net Loss of (Currency amounts in millions of US$) 2023 2022 2023 2022 $6.1 million (-3.6% net investment return) Inve
Slide 25: Arena FINCOs: Summary of Net Assets
Arena FINCOs: Summary of Net Assets (Currency amounts in millions of US$) Fair Value December 31, 2023 September 30, 2023 December 31, 2022 • The combination of the secured notes and Cash and cash equivalents $27.3 $12.6 $16.7 revolving credit facility are being utilized for Investments: efficient t
Slide 26: Arena FINCOs: Portfolio breakdown as at December 31, 2023
Arena FINCOs: Portfolio breakdown as at December 31, 2023 Equity / REO / Other Securities 15% Corporate Hard (1) Private Assets Debt Investments 45% 55% 28% Structured Finance and Assets 29% Real Estate Investments 28% Arena FINCOs held 221 positions at December 31, 2023 compared to 297 positions at
Slide 27: Company Update: Skyward Specialty Insurance
SKYWARD SPECIALTY INSURANCE COMPANY UPDATE
Slide 28: Skyward Specialty at a Glance
SKYWARD SPECIALTY AT A GLANCE Business Overview Select Financial Metrics • A rapidly growing and innovative specialty insurance company, FY FY (US$ millions) delivering commercial property and casualty products and solutions on 2023(1) 2022(1) a non-admitted and admitted basis Select Income Statemen
Slide 29: Skyward Specialty Trading Price and Volume
SKYWARD SPECIALTY TRADING PRICE AND VOLUME • At December 31, 2022, Westaim's estimated fair value of Skyward Specialty’s fully diluted common shares, using multiple valuation techniques, was determined to be $15.00 per share • At December 31, 2023, the Westaim’s estimated fair value of the Skyward S
Slide 30: Skyward Specialty – Summary Statements of Operations
SKYWARD SPECIALTY - SUMMARY STATEMENTS OF OPERATIONS (1) (Currency amounts in millions of US$) Three months ended December 31 Year ended December 31 Written Premium Growth and Revenue As at 2023 2022 2023 2022 • GWP increased 21.4% to $321.6 million in Q4 2023 vs. $264.8 million in Q4 2022; GWP incr
Slide 31: Skyward Specialty – Summary Balance Sheets
SKYWARD SPECIALTY - SUMMARY BALANCE SHEETS (Currency amounts in millions of US$) As at December 31, 2023 December 31, 2022 • Total Skyward Specialty stockholders’ equity increased Assets Investments $1,613.7 $1,082.4 to $661.0 million or 56.8% from Q4 2022; apart from Cash and cash equivalents 65.9
Slide 32: Appendix
SKYWARD SPECIALTY INSURANCE APPENDIX
Slide 33: Appendix – Skyward Specialty Supplementary Financial Measures
APPENDIX – SKYWARD SPECIALTY SUPPLEMENTARY FINANCIAL MEASURES (1) • Adjusted operating income – Skyward Specialty defines adjusted operating income (loss) as net income (loss) excluding the impact of certain items that may not be indicative of underlying business trends, operating results, or future
Slide 34: Appendix – Skyward Specialty Supplementary Financial Measures
APPENDIX – SKYWARD SPECIALTY SUPPLEMENTARY FINANCIAL MEASURES (1) • Adjusted Loss Ratio / Adjusted Combined Ratio – Skyward Specialty defines adjusted loss ratio and adjusted combined ratio as the corresponding ratio (calculated in accordance with GAAP), excluding losses and LAE related to the LPT a
Slide 35: The Westaim Corporation contact details
The Westaim Corporation 70 York Street, Suite 1700 Toronto, Ontario Canada M5J 1S9 www.westaim.com [email protected]