Kingsway Corporation · NYSE:KWY
Kingsway — Kingsway Financial Services — Investor Day (November 2004)
110 slides from Kingsway's investor day presentation, November 2004
Slide 1: Kingsway Financial Services Inc.
Kingsway Financial Services Inc.
Slide 2: Bill Star, President & C.E.O.
I< Bill Star President & C.E.O. Kincsway Financia Services Inc. Building Shareholder Value
Slide 3: Changing Market Conditions
A Changing Market Conditions
Slide 4: Agenda
Agenda 8:30-9:00 Reception 9:00-10:00 Bill Star, President & CEO, Kingsway Financial ¾Introduction, industry overview, Ontario auto update John McGlynn, President & CEO, Kingsway General ¾Company results, non-standard automobile, reserve activity, trucking John Clark, President & CEO, Lincoln Genera
Slide 5: Agenda
Agenda 10:45 - 11:20 Shaun Jackson, Executive Vice President & CFO, Kingsway Financial ¾Financial review and key performance financial measures Bill Star, President & CEO, Kingsway Financial ¾Outlook for 2005 11:20 – 11:45 Q&A Session
Slide 6: Forward Looking Statements
Forward Looking Statements Certain information included in this presentation and statements made by the Company are not historical facts but are forward-looking statements relating to such matters as anticipated financial performance, business prospects, market conditions, legislative and regulatory
Slide 7: Corporate Overview
I Corporate Overview Kincsway Financiat Services Inc. Building Shareholder Value
Slide 8: Operating Strategy
Kingsway Financial Operating Strategy Focus on good risks within specialty markets where limited competition allows for a good spread of risk and above-average returns Emphasize positive underwriting margins, conservative investment policies and low combined ratios to achieve above- average earn
Slide 9: Kingsway Financial Evolution
Kingsway Financial Evolution 1995 – Initial Public Offering 1996 – 1997 – Grow Canadian Platform 1998 – 1999 – U.S. Acquisitions/Formed Kingsway Re 1999 – 2001 – Soft Market Conditions 2001 – 2003 – Organic Growth 2004 – Stabilization
Slide 10: Geographic Area – Gross Premiums Written
Geographic Area – Gross Premiums Written 2003 2004 Canada Canada 25% 29% United States United States 75% 71% Year ended December 31 9 month period ended September 30
Slide 11: Diversified by Product Line (Gross Premiums Written)
Kingsway Financial Diversified by Product Line (Gross Premiums Written) Commercial Auto 12% Property & Liability 12% Trucking Motorcycle 29% 3% Other 3% Personal Auto 41% 9 month period ended September 30, 2004
Slide 12: Diversified by Geographical Area (Gross Premiums Written)
Kingsway Financial Diversified by Geographical Area (Gross Premiums Written) Illinois 11% Florida 10% Alberta 6% Texas 8% South Carolina 2% Quebec 5% New Jersey 3% Pennsylvania 2% Ontario16% California 13% Other 24% 9 month period ended September 30, 2004
Slide 13: Canadian Operations
KK ~ Kincsway Financiat Services Inc. Building Shareholder Value
Slide 14: Canadian Operations
Canadian Operations John John McGlynn McGlynn Colin Colin Simpson Simpson Jacques Jacques Muir Muir 22 22 of of years years of of experience experience 88 of of years years of of experience experience 48 48 of of years years of of experience experience
Slide 15: Market Leadership
Kingsway Financial Canadian Operations Market Leadership #1 Non-Standard Auto Insurer #1 Motorcycle Insurer #2 Trucking Insurer
Slide 16: Kingsway – Canadian Operations Gross Premiums Written
Kingsway – Canadian Operations Gross Premiums Written Other Trucking 6% 17% Standard Auto 22% Commercial Auto 6% Property and Liability 14% Non-Standard Auto Motorcycle 26% 9% 9 month period ended September 30, 2004
Slide 17: Canadian Operations Gross Premiums Written
Kingsway – Canadian Operations Gross Premiums Written ($ Millions) $655 $585 $491 $356 $289 $470 * $234 24% 5 year CAGR of 26% 1999 2000 2001 2002 2003 2004* * 9 month period ended Sept. 30 Years ended December 31
Slide 18: Combined Ratio
Combined Ratio Canadian Operations 110% Cdn Industry 100% 95.5% (YTD Sept. 2004) 91.5%* Cdn Operations (YTD June 2004) 90% 1998 1999 2000 2001 2002 2003 2004 Years ended December 31 * Source: 1999-2004 IAO, The Quarterly Report, 2nd Quarter, 2004 1998 IAO, The Quarterly Report, 3rd Quarter, 2003
Slide 19: Canadian Industry Market Conditions Recent Developments
Kingsway Financial Canadian Industry Market Conditions Recent Developments
Slide 20: Canadian Industry Results
Kingsway Financial Canadian Industry Results * (in $ billions) 2001 2002 2003 Gross Premiums Written $24.2 $29.8 $35.9 Underwriting Profit (Loss) $(2.2) $(1.4) $0.5 Combined Ratio 110.4% 105.8% 98.7% Return on Equity 3.1% 1.7% 11.3% Growth in Gross Premiums Written 12.2% 23.4% 20.3% * Rolling 12 mon
Slide 21: Key Ontario Automobile Changes
Canadian Market Key Ontario Automobile Changes Bill 198: Restored CPP deductibility Regulation of paralegals Prohibition of early lump sum settlements Referral fees illegal Paralegals liable for cost of frivolous claims Scale of costs for medical timesheets established Many companies
Slide 22: Facility Association - Ontario Results
Kingsway Financial Canadian Market – Facility Association - Ontario Results Premiums Earned Combined Ratio 2001 $41M 109% 2002 $86M 191% 2003 $399M 227% 2004 $659M 120% Cumulative rate increases since Q4 2002 of 105%
Slide 23: Continued Stabilization Going Forward
Continued Stabilization Going Forward
Slide 24: U.S. Operations
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Slide 25: U.S. Operations
U.S. Operations Tom Tom Ossmann Ossmann Marshall Marshall Romanz Romanz 14 14 of of years years of of experience experience 45 45 of of years years of of experience experience
Slide 26: U.S. Operations
U.S. Operations Roberto Roberto Espin Espin John John Clark Clark 30 30 of of years years of of experience experience 34 34 of of years years of of experience experience
Slide 27: U.S. Operations
U.S. Operations Roger Roger Beck Beck Richard Richard Murray Murray Scott Scott Wollney Wollney 15 15 of of years years of of experience experience 25 25 of of years years of of experience experience 15 15 of of years years of of experience experience
Slide 28: Market Leadership
Kingsway Financial U.S. Operations Market Leadership #1 Non-Standard Auto in Chicago #1 Taxi in Chicago & Las Vegas #2 Trucking Insurer in U.S.
Slide 29: U.S. Operations Gross Premiums Written
U.S. Operations Gross Premiums Written (U.S.$ in millions) $1,414 $1,044 $1,088 * $458 $238 $185 5 year CAGR of 60% 1999 2000 2001 2002 2003 2004* * 9 months period ended September 30 Years ended December 31
Slide 30: Kingsway – U.S. Operations Gross Premiums Written
Kingsway – U.S. Operations Gross Premiums Written Trucking 33% Non-Standard Property and Auto Liability 39% 11% Commercial Auto 14% Other 9 month period ended Sept 30, 2004 3%
Slide 31: Top Trucking Insurers
Kingsway – U.S. Operations Top Trucking Insurers (US$) Great West Casualty $471.2M Lincoln General $450.5M Continental $343.2M Northland $330.9M Empire $308.5M Canal $305.1M Sentry $297.7M * Source: A.M. Best DWP 2003
Slide 32: Top Non-Standard Auto Writers in U.S.
Kingsway – U.S. Operations Top Non-Standard Auto Writers in U.S. Progressive Group 6.3% Allstate 2.5% State Farm 1.4% GEICO 1.2% Kingsway 0.3% * Source: A.M. Best DWP 2003
Slide 33: John McGlynn
John McGlynn President & C.E.O.
Slide 34: Market Leadership
Kingsway Financial Canadian Operations Market Leadership #1 Non-Standard Auto Insurer #1 Motorcycle Insurer #2 Trucking Insurer
Slide 35: Kingsway General First Nine Months
Kingsway General First Nine Months ($ Millions) 2003 2004 % change Gross premiums written $350M $380M 8.6% Loss ratio 89.5% 76.8% 12.7% Expense ratio 25.5% 21.2% 4.3% Combined ratio 115.0% 98.0% 17.0% Accident year loss ratio 66.9% 70.8% (3.9%)
Slide 36: Kingsway General Gross Premiums Written
Kingsway General Gross Premiums Written Motorcycle Commercial Auto 8% 8% Long-Haul Trucking 27% Personal Auto 38% Property/Casualty 15% 9 month period ended September 30, 2004 Other 4%
Slide 37: Marketing/Branding
Kingsway General Marketing/Branding Ad Campaign Trucking Conference Proactive Communication (Kingsway Express) Coordination with Lincoln General
Slide 38: Average Annual Premium Per Exposure
Kingsway General Average Annual Premium Per Exposure 23% 28% 35% 16%
Slide 39: New Business Applications – Personal Auto
Kingsway General New Business Applications – Personal Auto 300 Ontario 250 a - Facility Rate Increases - Commission Reduction 200 150 a 100 a 50 Alberta 0 ay ay ar ar n n r r ct ly ov ly g g ne ne b b pt pt ec Ap Ap Ja Ja Au Au Fe Fe Ju Ju O M M Se Se M M N D Ju Ju 2003 2004
Slide 40: Claims Reserving
Kingsway General Claims Reserving Reserve by injury or damage Increase frequency of management review More frequent actuarial reviews Increase fraud detection training Linkage with U.S. liability claims teams
Slide 41: Loss Frequency
Kingsway General Loss Frequency * 30% 25% 20% Personal Auto Ontario 15% 10% Personal Auto Alberta 5% 0% Motorcycle 2000 2001 2002 2003 2004** Years ended December 31 * Number of claims divided by earned exposure ** 9 month period ended September 30
Slide 42: Average Reserve Per Claim Feature
Kingsway General Average Reserve Per Claim Feature (Incl. IBNR) 9% 30% 2% 31%
Slide 43: Average Settlement Per Claim Feature
Kingsway General Average Settlement Per Claim Feature On Closed Claims 128% 46% 50% 6%
Slide 44: Average Time to Close
Kingsway General Average Time to Close (in days)
Slide 45: Loss Reserves
Kingsway General Loss Reserves IBNR IBNR: Total ($ Millions) Reserves (%) December 31, 2001 $51 29% December 31, 2002 $76 31% December 31, 2003 $134 32% September 30, 2004 $170 32%
Slide 46: Focus Going Forward: Quality Underwriting
Kingsway General Focus Going Forward: 1 Quality Underwriting 2 Pricing Discipline 3 Active Fraud Detection 4 Timely Assessment of Loss Costs 5 Respond to Changing Market Conditions
Slide 47: 2005 Market Outlook
Kingsway General 2005 Market Outlook 1 Regulatory unrest in Alberta 2 Relative calm in Ontario auto 3 Stabilization of trucking rates 4 Continued underwriting discipline in the market
Slide 48: Changing Market Conditions
A Changing Market Conditions
Slide 49: John Clark
John Clark President & C.E.O.
Slide 50: Lincoln General
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Slide 51: GAAP Profit, Underwriting Profit, Combined Ratios
Lincoln General GAAP Profit Underwriting Profit Combined Ratios (US$ in millions) $23.1* * 9 month period ended September 30 Years ended December 31
Slide 52: GPW – Retail vs. Program Business
Lincoln General GPW – Retail vs. Program Business (U.S.$ in millions) Years Ended Dec 31 At September 30
Slide 53: Lincoln General Gross Premiums Written
Lincoln General Gross Premiums Written (US$ in millions) Commercial Auto 53% Other 1% Surety 2% Inland Marine 3% Other Liability 10% Personal Auto 31% 9 month period ended September 30, 2004
Slide 54: Top Commercial Auto Writers in U.S.
Lincoln General Top Commercial Auto Writers in U.S.* 2.90% State Farm Mutual 2.40% St. Paul Fire & Marine 2.19% Zurich American 1.88% Auto Owners 1.86% Travelers 1.62% Great West Casualty 1.55% Lincoln General * Source: A.M. Best DWP 2003
Slide 55: Top Trucking Insurers
Lincoln General Top Trucking Insurers (US$) Great West Casualty $471.2M Lincoln General $450.5M Continental $343.2M Northland $330.9M Empire $308.5M Canal $305.1M Sentry $297.7M * Source: A.M. Best DWP 2003
Slide 56: Top U.S. Non-Standard Auto Writers
Lincoln General Top U. S. Non-Standard Auto Writers * #1 Progressive Group 6.3% #2 Allstate 2.5% #3 State Farm 1.4% #4 GEICO 1.2% * * * * #12 Kingsway Group 0.3% Total market U.S. $155 billion * Source: A.M. Best A4 Report 2003 Year
Slide 57: Top Ten Gross Written Premium States
Lincoln General Top Ten Gross Written Premium States California 30% Florida 16% (Ranked 4th) (Ranked 7th) Maryland 4% New Jersey 13% (Ranked 8th) (Ranked 7th) Georgia 5% (Ranked 14th) Missouri 5% Illinois 10% (Ranked 6th) (Ranked 12th) Texas 5% (Ranked 6th) Alabama 6% Tennessee 6% (Ranked 4th) (Rank
Slide 58: Total Unpaid Claims
Lincoln General Total Unpaid Claims (U.S.$ in millions) Increase in 2004 52% Case 41% Case 25% 40% 48% Case 59% IBNR IBNR 60% IBNR December 31, 2002 December 31, 2003 September 30, 2004
Slide 59: IBNR Setting Process
Lincoln General IBNR Setting Process Monthly IBNR review 3 Actuaries on Staff Use of loss development factors Program and/or Industry data utilized KPMG’s Independent Review & Certification
Slide 60: Why is Lincoln General different?
Lincoln General Why is Lincoln General different? MGA’s vs Program Managers Underwriting/binding authority Claims handling Reinsurance Pricing Operating primarily as “wholesalers”
Slide 61: Program Overview
Lincoln General Program Overview -as at September 30, 2004 41 Active MGA programs 13 Terminated MGA programs since inception 17 Corporate entities as program partner No reinsurance authority No pricing authority 7 have limited claims authority
Slide 62: Program Manager Appointments
Lincoln General Program Manager Appointments (U.S.$ Millions) # of Program Managers GPW Total in 2003 18 $927M Terminated in 2004 2 $10M New Appointments in 2004 2 $20M
Slide 63: Programs - Audit Processes Philosophy
Lincoln General Programs - Audit Processes Philosophy Work with people we trust Require access and control Largest programs audited every 5 – 6 weeks Contract – collateral, personal guarantee and immediate termination for “cause”
Slide 64: Audit Processes
Lincoln General Audit Processes 1 Operational Audits 2 Non-Operational Audits 3 Claims Audits
Slide 65: MGA Audits – Planning & Execution
Lincoln General MGA Audits – Planning & Execution Audit Plan – monitor quarterly Audit Information – tracked in database Audit Templates – separate templates for each line of business Dedicated Team Approach - to each audit
Slide 66: MGA Audits - Reporting
Lincoln General MGA Audits - Reporting Standardized Audit Report Executive Summaries – quarterly to KFSI Audit Committee Follow up tools - periodic ‘Reminders’ and Management Reports on outstanding issues
Slide 67: MGA Audits
Lincoln General MGA Audits Emphasize program manager oversight Focus on profitability Focus on program managers’ financial strength Analyze and evaluate
Slide 68: 2005 Strategy
Lincoln General 2005 Strategy Keep profitable programs - improve performance Eliminate non-performing programs Identify new programs and business partners Focus on improving non-standard auto performance Know what your partner is doing
Slide 69: Changing Market Conditions
A Changing Market Conditions
Slide 70: Shaun Jackson
Shaun Jackson Executive Vice President & C.F.O.
Slide 71: Changing Market Conditions
A Changing Market Conditions
Slide 72: Growth in Gross Premiums Written
Growth in Gross Premiums Written (C$ Millions) $2,636.8 GR CA $2,124.7 52% $1,065.3 $643.0 $409.2 $508.6 $140.6 $210.8 1996 1997 1998 1999 2000 2001 2002 2003 Years ended December 31
Slide 73: Growth in Net Income
Growth in Net Income (C$ Millions) $85.3 $79.5 GR CA 34% $44.9 $31.0 $27.5 $22.2 $11.2 $13.6 1996 1997 1998 1999 2000 2001 2002 2003 Years ended December 31
Slide 74: Book Value Per Share
Financial Review Book Value Per Share (C$) $12.56 $12.63 $11.03 $8.01 $6.96 $7.12 $5.95 $3.26 $1.90 27% CAGR 1995 1996 1997 1998 1999 2000 2001 2002 2003 Years ended December 31
Slide 75: Diluted Earnings Per Share
Financial Review Diluted Earnings Per Share (C$) $1.61 $1.62 $1.19 $0.86 $0.80 $0.73 $0.49 $0.38 $0.30 23% CAGR 1995 1996 1997 1998 1999 2000 2001 2002 2003 Years ended December 31
Slide 76: Recent Financial Results
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Slide 77: Third Quarter Results 2004
Third Quarter Results 2004 2003 2004 % Chg Gross Premiums Written $653M $619M (5%) Net Premiums Earned $592M $592M - Net Income $15.6M $30.6M 96% EPS (diluted) 28¢ 54¢ 93% Return on equity 9.8% 15.4% 5.6% Combined ratio 103.7% 97.0% 6.7% Underwriting profit ($22.1M) $17.9M -
Slide 78: Third Quarter Results 2004
Third Quarter Results 2004 2003 2004 GPW Combined GPW Combined Ratio Ratio Canada $167M 117.1% $195M 93.6% United States $486M 99.0% $424M 98.4% Consolidated $653M 103.7% $619M 97.0%
Slide 79: Nine Months 2004
Nine Months 20042003 2004 Gross Premiums Written $1,985M 2% $2,031M Net Premiums Earned $1,764M N/A $1,763M Underwriting Profit $0.4M N/A $41.5M Income before income taxes $68M 62% $110M Net Income $67M 41% $95M Earnings Per Share $1.31 28% $1.68 Return on Equity 13.9% 2.9% 16.8% Book Value Per Shar
Slide 80: Impact of Currency Fluctuation Nine Months 2004
Impact of Currency Fluctuation Nine Months 2004 Balance Sheet QTR YTD Currency Translation Adjustment-change $36.2M $10.6M Book value per share $0.64 $0.19 Income Statement: Gross Premiums Written $23M $115M Net Premiums Earned $23M $96M Underwriting Profit $0.4M $1.8M Investment Income $0.9M $3.7M
Slide 81: Nine Months Results 2004 – U.S. $
Nine Months Results 2004 – U.S. $ 2003 2004 Gross Premiums Written $1,391M 10% $1,528M Net Premiums Earned $1,236M 7% $1,327M Net Income $47M 51% $71M Earnings Per Share (diluted) 91¢ 38% $1.26 Underwriting Profit $0.3M N/A $31.2M Combined Ratio 100.0% 2.4% 97.6% Book Value Per Share $9.54 17% $11.1
Slide 82: Bristol West Results
Bristol West Results 9 months to Sept. 30, 2004 (US$ millions) Reported Quota Share KFS Method Net Premiums Earned $237 $275 $512 Policy Service Fees * 57 Total $294 Claims Incurred $161 $187 $348 Commission and U/W Expenses 63 80 143 $224 $267 $491 (1) (2) Loss Ratio 55% 68% 68% (2) Combined Ratio
Slide 83: Combined Ratio Nine Months 2004
Combined Ratio Nine Months 2004 2003 2004 Commission ratio 21.3% 18.8% General Expense ratio 5.8% 8.4% Loss ratio 72.9% 70.4% Combined ratio 100.0% 97.6%
Slide 84: Segmented Numbers: Canadian Operations
Segmented Numbers Canadian Operations – Nine Months – in Cdn Dollars ($ Millions) 2003 2004 % change Gross premiums written $469.9M $584.9M 24% Net premiums earned $403.9M $491.6M 22% Combined ratio 109.9% 95.5% 14.4% Loss ratio 81.9% 70.4% 11.5%
Slide 85: Segmented Numbers: U.S. Operations
Segmented Numbers U.S. Operations – Nine Months 2004 (in U.S. $) ($ Millions) 2003 2004 % change Gross premiums written $1,058M $1,088M 3% Net premiums earned $955M $957M - Combined ratio 97.0% 98.5% (1.5%) Loss ratio 70.2% 70.5% (0.3%)
Slide 86: Loss Reserving
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Slide 87: Significant Reserve Strength
Significant Reserve Strength Case Reserves IBNR Increase in: 9 months to Sept. 30, 2004 29% 7% Year ended December 31, 2003 30% 52%
Slide 88: Significant Reserve Strength
Significant Reserve Strength IBNR: Total Reserves Consolidated Canada U.S. September 30, 2004 40% 35% 43% December 31, 2003 45% 33% 50% December 31, 2002 41% 34% 44%
Slide 89: Comparison of Percentage IBNR: Total Reserves
Comparison of Percentage IBNR: Total Reserves Personal Commercial Total Lines Lines Kingsway Financial 41% 40% 40% Comparable U.S. Public Companies: Allstate 26% 26% Safeco 40% 40% Bristol West 27% 27% Commerce Group 21% 21% Direct General 38% 38% Progressive 20% 20% W.R. Berkely 52% 52% Philadelphi
Slide 90: Impact of Adverse Claims Development
Impact of Adverse Claims Development 2003 2004* Change in Estimated Unpaid Claims Canada $104.0M $19.0M U.S. $92.8M $20.5M TOTAL $196.8M $39.5M % of Net Premiums Earned Canada 18.8% 3.9% U.S. 5.1% 1.6% TOTAL 8.3% 2.2% % of Unpaid Claims Canada 31.5% 3.6% U.S. 11.8% 1.7% TOTAL 16.4% 2.4% * 9 month pe
Slide 91: Accident Year Claims Ratios
Financial Review Accident Year Claims Ratio’s – 9 Months Canada U.S. 2004 2003 2004 2003 As Reported 70.4% 81.9% 70.5% 70.2% Storms (1.0%) - (0.1%) - Prior-Year Claims (3.9%) (18.5%) (1.6%) (4.2%) Current Accident Year 65.5% 63.4% 68.8% 66.0%
Slide 92: Financial Results
Financial Results 9 Months to September 30 $’000 Underwriting Profit - 2004 $ 41,470 Underwriting Profit - 2003 406 Improvement $ 41,064 Adverse Development - 2004 $ 39,509 Adverse Development - 2003 131,439 Improvement $ 91,930
Slide 93: Investment Portfolio
I< Investment Portfolio iwc. Building Shareholder Value
Slide 94: Investment Portfolio
Investment Portfolio At September 30, 2004 Accrued Interest & Term Deposits 11% Cash 4% Government Bonds 25% Premium Finance Receivables 3% Equities 10% Corporate Bonds 47%
Slide 95: Financial Review – Investment Portfolio (C$)
Financial Review – Investment Portfolio (C$) Investment Portfolio* Investment Portfolio Cash Flow Generated At Fair Value Per Share From Operations (in $ millions) (in $’s) (in $ millions) 1996 $190 $7.15 $45 1997 $349 $9.74 $48 1998 $625 $17.40 $63 1999 $662 $19.46 $34 2000 $780 $22.91 $93 2001 $1,
Slide 96: Maturity Profile of Fixed Income
Investment Portfolio Maturity Profile of Fixed Income at Sept. 30, 2004 0 – 1 year 21% 1 – 2 years 26% 2 – 5 years 42% 89% Over 5 years 11% 100%
Slide 97: Financial Strength
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Slide 98: Financial Strength
Financial Strength Rolling Four Quarters Years ended December 31 2001 2002 2003 2004* NPW to Stat. Surplus 2.2x 3.1x 2.9x 2.4x Interest Coverage 7.1x 7.6x 5.2x 6.0x Senior Debt to Cap 21% 28% 22% 26% * as at September 30, 2004
Slide 99: Changing Market Conditions
A Changing Market Conditions
Slide 100: Bill Star, President & C.E.O.
I< Bill Star President & C.E.O. Kincsway Financia Services Inc. Building Shareholder Value
Slide 101: Building Shareholder Value
Building Shareholder Value Return on Equity Combined Ratio Increase in NPE 1995 19.8% 96.6% 9% 1996 21.4% 95.6% 134% 1997 16.5% 95.8% 62% 1998 13.4% 93.9% 80% 1999 5.5% 102.6% 42% 2000 10.7% 101.0% 21% 2001 13.3% 99.1% 62% 2002 13.8% 99.8% 99% 2003 12.9% 101.4% 37% 2004 (Sept 30) 16.8% 97.6% 0%
Slide 102: Return on Equity
Kingsway Financial Return on Equity Kingsway Financial 16.8% Canadian * 16.9% U.S.** 12.7% * 1999-2004 IAO, The Quarterly Report, 2nd Quarter, 2004 ** 1999-2004 A.M. Best, Special Report, February 2004
Slide 103: Share Price
Financial Review Share Price $20.00 $18.40 $14.60 $13.50 $13.69 $12.00 $8.25 $7.25 $7.90 $2.50 25% CAGR 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004* * At Nov. 15, 2004 Years ended December 31 Adjusted for prior years stock splits
Slide 104: Share Performance
Kingsway Financial Share Performance * as at November 15, 2004
Slide 105: Stabilization
Kingsway Financial Building infrastructure Moving on opportunities Correcting mistakes Maintaining discipline Developing key people Stabilization
Slide 106: Kingsway Cares
Kingsway Cares Trillium Health Centre Foundation
Slide 107: Outlook
Kingsway Financial Outlook Future Plans Canada – Ontario/Alberta U.S. – Non-Standard Auto/Trucking Continued stable growth Recognize changes in market conditions Prepared for change
Slide 108: Kingsway Financial
Kingsway Financial
Slide 109: Changing Market Conditions
A Changing Market Conditions
Slide 110: Kingsway Financial Services Inc.
Kingsway Financial Services Inc.
Kingsway Financial Services — Investor Day (November 2004) on 6ix