Enstar Group Limited · OTC:ESGOF
Enstar — Investor Presentation (June 2012)
27 slides from Enstar's investor presentation, Jun 19, 2012
Slide 1: Realising Enstar value Investor Presentation
Exhibit 99.1 Realising Enstar www.enstargroup.com Investor value Presentation Grand Hyatt, New York, NY June 19, 2012
Slide 2: Disclaimer
Your presentation This Disclaimer periods, differ industry, personnel, uncertainties reflects statements, throughstrategic from Enstar EDGAR as the our well those which success materialize, partner liquidity Group asset on includes speak thethe forth ofLimited’s 2run-off implementing and SEC only or
Slide 3: Today's Agenda
Today’s Your strategic Agenda partner Company 3 overview & recent highlights Enstar’s economic model Acquisition process Reserve savings Investments Financial historical data Closing remarks / Q&A
Slide 4: Company overview & recent highlights
Your strategic Company Founded employees finality 4public company for inoverview Largest non-core Bermuda partner in January stand &legacy inrecent 1993 alone 2007 liabilities highlights byrun-off members (all of Primary company which of current objective have Strong been management value isre-inves
Slide 5: Company overview & recent highlights (cont'd)
Your strategic Company Liability Lloyd’s 5March 31, run-off management overview 2012) partner managing to $6.5 & is recent greatest billion agent highlights Acquisitions now source 100% (cont’d) of Enstar’s Enstar and earnings Completed value creation to date largest have Gross acquisition resulted
Slide 6: Growth in Fully Diluted Book Value Per Share
Growth 6Your CAGR Book $90 2006 Yearsstrategic $31.85 $36.92 $45.18 $58.06 $71.68 $82.97 $80 in 2007 Value ended Fully 21.1% $70 2008 Perpartner Diluted December $60 Share 2009 $50 $40Book 2010 31st $30 Value 2011 $20 Per$0Share December 31, 2006 – December 31, 2011 $10
Slide 7: Significant financing opportunity
Company Significant financing 7Your Total Enstar 2007 $60.2 $60.3 $242.7 $245.3 $255.0 $391.5 10.5% 12.6% 16.8% 19.2% 31.0% strategic 2008 Debt Enstar overview Debt financial Debt 2009partner has& / Capital /2010resources—at rapidly (Debtrecent Over 2011 de-levered highlights + Common Time Marchfrom
Slide 8: Run-off market overview
Yourisstrategic Worldwide investors liabilities and wellwant are known Excess embedded partner change by, capacity Company and and in has ongoing consolidation in good theoverview insurance insurance relationships United & market recent groups States with, highlights should rather Size regulators re
Slide 9: Europe run-off market overview
Company Industry Europe delay reinsurance Your strategic European sources overview opportunities partner run-off estimate & 9recent solutions sizehighlights of run-off and divestments (cont’d)—Run-off liabilities Lloyd’s to be approximately Volume market overview of new €200 RITC billion transaction
Slide 10: Enstar's economic model
Enstar’s Your Step Enstar Redeploy Acquire Harvest 1: 2: 3: strategic recycles Enstar Profits Equity Liabilities economic Capital partner acquires generates released capital model 10 through insurance from profits theits from underlying liabilities business run-offoperating from regulated entities v
Slide 11: Enstar Group Limited balance sheet growth 2001-2011
Your Enstar’s Enstar December (In 5,000 6,000 7,000 2,000 3,000 4,000 2001 Year Total $millions) strategic Assets 2002 Loss Net Non-controlling 1,000 Group economic Book 31, Reserves 2003 0 Limited partner 2001 Value 2004 model to 11 interest 2005 Balance December – Balance 2006 Sheet 31, 2007 sheet
Slide 12: Summary of acquisitions (2001-2011)
Your strategic Enstar’s Summary Acquisition 2004 2010 4 760.8 14 1,699.7 economic ofYear acquisitions 732.8 partner 1,498.6 Number model 26.2 12 255.1 -— (2001 –ofAcquisition Acquisitions 26.2 71.0 – 2011) 2005 184.1 1history 43.5 Total 201142.0 Assets 7 2,132.7 1.5Acquired -—1,794.7 1.5 2006 $’m 26
Slide 13: How Enstar acquires companies & portfolios in run-off
Your strategic Enstar’s pipeline acquisitions many economic Run-off partner timesmodel the M&A 13size – is How of “lumpy” our Enstar annual byacquires nature transaction –companies volume volume of&closed and portfolios value dealsSenior inisrun-off not leadership indicative Enstar’sat oftransaction
Slide 14: How Enstar acquires companies & portfolios in run-off (cont'd)
Yourround Enstar’s first Board strategic and/or economic followed executive partner model by14non-binding management – How Enstar offer discussion acquires If short-listed and companies approval then & detailed Signing portfolios due of SPA in diligence run-off begins–(cont’d) regulatory actuarial,
Slide 15: How Enstar acquires companies: due diligence process
Yourdiligence Enstar’s Due investment strategic economic portfolio income, process partner model expenses, Tax 15 is largely review—audit – HowtaxasEnstar and follows: distributions firm acquires Oversight Legalcompanies review and coordination –&in-house portfolios and byin external Enstar’s run-of
Slide 16: How Enstar acquires companies: post-acquisition
Your to Enstar’s twice operations, brokers staff strategic before optimum and economic package reinsurers completion partner level model them 16 Analyze in–as2008 How “ready reinsurance (once Enstar for in sale” acquires 2001 asset andand for companies complete once additional in process 2004) & por
Slide 17: Harvesting equity through loss reserve savings
Enstar’s Your We Approximately Diversified 28.7% Disciplined Insurance Range General Workers Other Asbestos Construction Marine Environmental Unallocated Total: High Selected Low $3,763 $4,283 $4,752 manage strategic 14% $4,283mm of compound & Casualty economic Comp Actuarial 14% Aviation Liabilitie
Slide 18: Harvesting equity through loss reserve savings (cont'd)
Yoursignificant Enstar’s Primary Settling Disciplined Effective Commuting Primarily One-time Targets Growth All Contract strategic initially in litigation aims economic validation recovery settlement relates acquisitions claims policies partner counterparties’ determined to(where of model management
Slide 19: Harvesting equity through loss reserve savings (cont'd)
Youracquisition Enstar’s Commuting Commutations All Disciplined On Claims Usage Participation commutations strategic ofinspections approval economic third-party claims policies inpartner Enstar’s can market levels require model management take are lawyers (cont’d) 19 prioritized, claims are claim ma
Slide 20: Harvesting equity through loss reserve savings (cont'd)
Enstar’s Our However, Your Reinsurance “A-” All Total Bad Net other reinsurance bad debt rated strategic reinsurance debt economic reinsurers recovery provisions “A-” reinsurers Asset recoverables provision partner or recoverable recoverable better-rated and as model 432.5 (349.7) 1,558.5 at20 commu
Slide 21: Investment strategy: constraints
Your Enstar’s Investment Our Required To Current Loss We fund will aim cash reserves strategic economic to generally acquisitions, economic and tosettle strategy—Constraints post investment are partner the collateral our have environment model majority we key 21negative aim portfolio –risk inHarvest
Slide 22: Investment strategy: duration and opportunities
Your strategic Enstar’s Duration Strategy/opportunities Investments Actively Potential Further Investment Management Chief Investment centralized economic pursuing of hardening Committee—Bob majority with partner duration Officer opportunistic model management of(approximately 22 interest ––over Rog
Slide 23: Investments: fair value of cash and investment portfolio
Your Enstar’s The Alternative Fair Type U. Non Corporate Municipal Residential Commercial Asset-backed Other Public Cash Total S.following Value U.S. strategic of and Government 4,602.8 investments equities Investment economic cash government 1,945.6 25.4 Percent Investments mortgage-backed mortgage
Slide 24: Financial Historical Data: Summary Balance Sheet
Your strategic Financial 961.4 639.8 267.4 March 638.3 728.8 274.3 31,Historical 2012 672.7 615.6 256.0 partner (in63.4 465.3 688.7 US$ Data 24Total millions) Other 311.7 Mar1,665.7 31, Total 215.7 2012 Liabilities 1,683.4 257.6 Dec390.0 31, 1,215.8 4,794.1 2011 211.4 1,076.1 Dec 4,922.7 197.6 31, 8
Slide 25: Financial Historical Data: Summary Statement of Earnings
Your Financial Summary 2010 gains other 15.4 61.8 5.1 strategic 12-Months expenses 45.8208.5 Statement 21.9partner Historical 215.7 (39.7) 77.9 Ended 113.0 of 177.0 (37.4) 25Earnings Dec Data 85.6 147.5 (170.4) 31,24.9 2009 –68.5 December (155.7) 64.3 12-Months NetGain earnings (156.7) 31, on2007 En
Slide 26: Closing Remarks / Q&A
Closing Remarks / Q&A Your strategic partner 26
Slide 27: Enstar Contact
Your strategic Enstar Contact Street, America [email protected] Principal Suite House 330 partner 2Locations Warwick America 27 RIBermuda Square 02886London 411 Windsor Fifth EC3NPlace Avenue, 2LU 3rdTel: 5th Floor Floor +44 181483 New Queen 452622 York, Street [email protected].