Aventus Capital Inc. · TSXV:AVTS
Aventus Capital — The Westaim — Q4 2020 Earnings Presentation
32 slides from Aventus Capital's earnings presentation, Mar 25, 2021
Slide 1: Q4 2020 Investor Presentation
Q4 2020 Investor Presentation March 25, 2021
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: Important Disclosures
Important Disclosures Non-GAAP Measures Westaim Westaim uses both international financial reporting standards (as issued by the International Accounting Standards Board) (“IFRS”) and non-GAAP measures to assess performance. Westaim cautions readers about non-GAAP measures that do not have a standard
Slide 4: Important Disclosures
Important Disclosures Arena Investors The following is being provided solely in relation to Arena Investors, LP, its funds, subsidiaries and affiliates: Returns shown are unaudited. Past performance is not indicative or a reliable indicator of future performance. Actual results may vary. The informa
Slide 5: The Westaim Corporation
The Westaim Corporation The Westaim Corporation Westaim is a publicly listed (TSXV:WED) 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 high qualit
Slide 6: Q4 2020 Quarterly Operating Highlights
Q4 2020 Quarterly Operating Highlights Q4 2020 completes a year of building and repositioning – setting Westaim up for growth, earnings and accelerating financial performance in 2021 • Skyward Specialty’s Q4 Net Loss was $30.8 million (Q4 2019 – Income of $7.9 million); excluding unusual items Q4 Ne
Slide 7: Westaim Summary Quarterly Operating Results
Westaim Summary Quarterly Operating Results Operating results Q4 2020 Q4 2019 Income from investment in Arena FINCOs and ASOF $1.6 $2.7 • Adjusted Q4 2020 profit after tax excluding unusual Income from investment in Skyward Specialty excluding unusual items 5.9 3.5 items* was $4.9 million or $0.03 p
Slide 8: Westaim Summary Full Year Operating Results
Westaim Summary Full Year Operating Results Operating results FY 2020 FY 2019 • Adjusted 2020 profit after tax excluding unusual items* was $5.0 million or $0.03 per share compared to $25.2 Income from investment in Arena FINCOs and ASOF $0.1 $12.0 million or $0.18 per share in Q4 2019 Income from i
Slide 9: Westaim Summary Statement of Financial Position
Westaim Summary Statement of Financial Position • Book value per share decreased $0.09 in Q4 2020 or As at December 31, 2019 September 30, 2020 December 31, 2020 3.9%; in C$ the decrease was C$0.25 or 8.1% Assets Cash $22.2 $8.3 $8.7 • At the December 31, 2020 closing stock price of Income tax recei
Slide 10: Westaim Book Value per Share: Three months ended December 31, 2020
Westaim Book Value per Share: Three months ended December 31, 2020 $2.33 ($0.13) $0.01 ($0.02) $0.01 $0.04 $2.24 ($0.01) $0.01 BVPS September Skyward Specialty Net Impact of LPT Skyward Specialty Income from Income from Income from Westaim's holding BVPS December 30, 2020 goodwill on Skyward unusual
Slide 11: Westaim Book Value per Share: Year Ended December 31, 2020
Westaim Book Value per Share: Year Ended December 31, 2020 $2.48 ($0.10) ($0.13) $0.08 $0.0 $0.0 ($0.05) ($0.04) $2.24 $0.0 BVPS December Change in Skyward Net Impact of Skyward Income from Income from Loss from Arena Westaim's BVPS December 31, 2019 valuation Specialty LPT on Skyward Specialty Skyw
Slide 12: Company Update: Skyward Specialty Insurance
SKYWARD SPECIALTY INSURANCE COMPANY UPDATE
Slide 13: Skyward Specialty at a Glance
SKYWARD SPECIALTY AT A GLANCE Business Overview Select Financial Metrics • A private, US-based specialty property and casualty insurer 2020 Excl. LPT and that writes on both an admitted and non-admitted basis (US$ millions) unusual items(1) • Strategy focuses on building defensible positions in high
Slide 14: Q4 2020 Quarterly Result Headlines
Q4 2020 QUARTERLY RESULT HEADLINES • Q4 Net Loss was $30.8 million (Q4 2019 – Income of $7.9 million); excluding unusual items Q4 Net Income was $12.9 million (Q4 2019 –$7.9 million) • GAAP results were impacted by several unusual items totaling $43.7 in Q4 2020 and $89.6 in FY 2020 : • Impact of th
Slide 15: Go to Market with Ten Specialties
GO TO MARKET WITH TEN SPECIALTIES (1) Net Written Premiums(1) 3% 6% 10% Industry Solutions 14% 26% 9% 6% 8% 13% 31% Construction Energy Specialty Trucking Captives & Programs Global Property Mgmt. & Prof. Liability A&H Surety E&S Brokerage (1) Net written premiums (“NWP”) for the year ended December
Slide 16: Skyward Specialty: Summary Statements of Operations
SKYWARD SPECIALTY: SUMMARY STATEMENTS OF OPERATIONS Quarter-to-date Year-to-date Q4 2020 Q4 2019 YTD 2020 YTD 2019 Q4 2020 Written Premiums Gross written premium $196.4 $185.3 $873.6 $878.3 • Gross Written Premium increased 6.0% in Q4 versus Q4 2019 with Net written premium 102.6 90.3 413.3 421.7 gr
Slide 17: Skyward Specialty: Summary Balance Sheets
SKYWARD SPECIALTY: SUMMARY BALANCE SHEETS As at December 31, 2019 September 30, 2020 December 31, 2020 • In Q2 2020, Skyward closed a Loss Portfolio Transfer transaction mitigating unfavourable development of prior Investments $711.7 $679.5 $764.8 period reserves, primarily from 2017 policy years an
Slide 18: Stockholders' Equity: Three Months Ended December 31, 2020
STOCKHOLDERS' EQUITY: FOR THE THREE MONTHS ENDED DECEMBER 31, 2020(1) $13.3 $(3.6) $3.6 $(43.7) $435.8 $0.1 $405.5 Adjusted stockholders' Employee share activity Net Comprehensive Impact of LPT, Other net recoveries, Goodwill impairment, net Adjusted stockholders equity September 30, Income excludin
Slide 19: Stockholders' Equity: Year Ended December 31, 2020
STOCKHOLDERS' EQUITY: FOR THE YEAR ENDED DECEMBER 31, 2020(1) $24.9 ($47.2) $100.0 ($3.5) $1.3 ($43.7) $405.5 $373.7 Adjusted stockholders' Rights offering of Employee share Net Comprehensive Impact of LPT, Other net recoveries, Goodwill impairment, Adjusted stockholders equity December 31, converti
Slide 20: Conservatively Positioned Investment Portfolio
CONSERVATIVELY POSITIONED INVESTMENT PORTFOLIO • The $765(1) million investment portfolio is conservatively December 31, 2020(1)(2) positioned, comprised mainly of core fixed income assets 1% (3.6 year duration), short-term investments and cash 3% • Total portfolio during including alternatives is 1
Slide 21: Arena Investors: Seeing What's Possible
December 31, 2020 Seeing What’s Possible
Slide 22: About Arena Investors
About Arena 22 ABOU T ARENA • Global originator and underwriter of proprietary investments INVESTORS seeking to produce consistent and uncorrelated returns $2.2B • Institutional scale and experience with transaction sizes Assets Under Management(1) between $5 million – $50 million, which avoids comp
Slide 23: Q4 2020 Quarterly Result Highlights
Q4 2020 Quarterly Result Highlights 23 Now In Second • 60+ full-time employees globally Stage of Growth • Financing being put in place across entities • $2.5B+ deployed into 200+ illiquid transactions Continued Strong • 109 exited illiquid investments with a realized Gross IRR of 17.9%(1) Performanc
Slide 24: Q4 2020 Quarterly Result Highlights: Results
Q4 2020 Quarterly Result Highlights 24 Q4 2020 Results: • Net profit was $2.8 million for Q4 2020, compared to $0.7 million loss in Q3 2020 and $0.4 million loss in Q4 2019 • Management and Service Fee revenue was $5.9 million for Q4 2020, compared to $5.0 million in Q3 2020 and $4.9 million in Q4 2
Slide 25: Arena Fully Diversified
Investment vehicles 25 $2.2 B UNDER MANAGEMENT, $1.3 B DEPLOYED* EXCESS CAPACITY OPPORTUNITIES STRATEGY $1.6 B , $1.2 B DEPLOYED Permanent Capital (Arena F INCOs) $0.5 B , $0.1 B DEPLOYED ARENA FULLY DIVERSIFIED • Arena Finance • Arena Origination Arena New Zealand Real Estate Credit Partners Arena
Slide 26: Arena Investors – Performance
Arena Investors – Performance 26 Consistent and uncorrelated performance(1); stable results through 2020 2020 3 YEARS 5 YEARS SINCE INCEPTION 1. This composite is comprised of one onshore open-ended fund and one offshore open-ended fund, which commenced operations on October 1, 2015 and March 1, 201
Slide 27: Arena Group's Assets Under Management
Arena Investors – Assets Under Management Through 1/1/2021 27 $2,500 mm $2,156 $473 $25 $2,041 $9 $2,000 mm Arena Group’s assets $(55) under management $1,750 mm $1,589 (including undrawn commitments) grew by $1,500 mm $452 million in Q4 $1,250 mm $1,251 2020 to $2.0 billion at $1,024 year end and $
Slide 28: Arena FINCOs
fl’. ARENA Arena FINCOs
Slide 29: Arena FINCOs: Summary of Operating Results
Arena FINCOs: Summary of Operating Results Three months ended Year ended Strategic Transactions December 31 December 31 • In Q1 2020, $34.8 million was returned to Westaim from Arena FINCOs to primarily to provide capital for Westaim to 2020 2019 2020 2019 participate in Westaim’s pro-rata share (44
Slide 30: Arena FINCOs: Summary of Net Assets
Arena FINCOs: Summary of Net Assets Fair Value December 31, 2019 September 30, 2020 December 31, 2020 Cash and cash equivalents $8.6 $55.9 $21.4 Due from brokers, net 1.6 4.1 (5.5) • During 2020, the following key events Investments: impact the net assets of the Arena Corporate Private Credit 61.9 4
Slide 31: Arena FINCOs: Portfolio breakdown as at December 31, 2020
Arena FINCOs: Portfolio breakdown as at December 31, 2020 Other Securities 19% Corporate Private Credit 25% Equity(1) 35% Consumer Assets 8% Structured Finance 3% Debt 65% Real Estate and Real Commercial and Estate Private Credit Industrial Assets 28% 17% Arena FINCOs held 158 positions at December
Slide 32: The Westaim Corporation
The Westaim Corporation 70 York Street, Suite 1700 Toronto, Ontario Canada M5J 1S9 www.westaim.com [email protected]