Tiptree Inc. · NASDAQ:TIPT
Tiptree — FY2016 Earnings Presentation
21 slides from Tiptree's earnings presentation, Mar 13, 2017
Slide 1: Investor Presentation - 2016
March 2017 Financial information for year ended December 31, 2016 NASDAQ: TIPT INVESTOR PRESENTATION - 2016 Exhibit 99.2
Slide 2: Limitations on the Use of Information
1 LIMITATIONS ON THE USE OF INFORMATION This presentation has been prepared by Tiptree Inc. and its consolidated subsidiaries (“Tiptree", "the Company" or "we”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree, its subsidiarie
Slide 3: Overview & Financial Results: Key Highlights
OVERVIEW & FINANCIAL RESULTS Key Highlights
Slide 4: 2016 Performance Summary
3 Revenue $567.2 million 29.4% vs. prior year Adjusted EBITDA (1) $78.9 million 35.1% vs. prior year Book Value per share, as exchanged (1) $10.14 13.9% vs. 12/31/15 Income from continuing operations $32.3 million vs. prior year loss of $13.8 million 2016 PERFORMANCE SUMMARY þ Specialty Insurance op
Slide 5: Improving Financial Performance
4 2014 2015 2016 $(0.10) $0.17 $0.78 ($ in millions, except per share information) 2014 2015 2016 Market Enterprise Value (2) $503.5 $381.9 $380.7 TTM Adjusted EBITDA $58.9 $58.4 $78.9 Implied market EV multiple 8.5x 6.5x 4.8x Book Enterprise Value (3) $541.1 $500.3 $526.1 Implied book EV multiple 9
Slide 6: Segment Performance Summary
5 SEGMENT PERFORMANCE SUMMARY 43.3 60.5 (6.8) 25.3 6.6 10.5 5.9 10.5 (23.2) (27.9) $32.5 (2) ($ in millions) Senior Living Corporate & Other Specialty Finance Specialty Insurance Asset Management $25.9 $78.9 Total: $20.5m increase $58.4 (1) Adjusted EBITDA includes income from continuing and discont
Slide 7: Key Performance Highlights
Year Ended December 31, 2016 KEY PERFORMANCE HIGHLIGHTS
Slide 8: Specialty Insurance Key Financials
7 Key financials (1) 2016 financial highlights Revenues, pre-tax income and Adjusted EBITDA up year- over-year driven by: ü Investment income of $24.6m, up $18.8m from 2015 ü Credit protection underwriting margin of $64.8m, up 5% ü Programs underwriting margin of $9.1m, up 65% Partially offset by: •
Slide 9: Specialty Insurance - Investment Portfolio
8 SPECIALTY INSURANCE - INVESTMENT PORTFOLIO ($ in millions) Interest expense Realized gains (losses) Net Investment Income Unrealized gains • Loans - $2.7 • Equities - $7.3 Investment income Overview We actively manage our investment portfolio to achieve a balance of two primary objectives: • Cash
Slide 10: Asset Management Financials
9 As adjusted revenue components (1) 2016 financial highlights Significant year-over-year improvement in pre-tax income • Fee revenue increases primarily driven by incentive fees on older vintage CLOs • $2.6m of unrealized and realized gains contributed positive earnings Recent developments and outl
Slide 11: Senior Living Highlights and Outlook
10 2015 2016 $6.5 $7.7 Key financials (1) 2016 highlights and outlook Improvement in pre-tax income of 38.9% primarily driven by increases in rental revenue which outpaced higher depreciation & other expenses from recently acquired properties Adjusted EBITDA of $10.5m, up 59.1% driven by improving N
Slide 12: Well Positioned for 2017 and Beyond
11 Revenue Adjusted EBITDA WELL POSITIONED FOR 2017 AND BEYOND Performance is expected to benefit from: • Continued growth in specialty insurance written premiums • Improvements in long-term, net investment income as our specialty insurance investment portfolio grows with written premiums • Increasi
Slide 13: Appendix
APPENDIX
Slide 14: EBITDA and Adjusted EBITDA Reconciliation
13 Management uses EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that use of these financial measures on a consolidated basis and for each segment provide supplemental information useful to investors as it is frequently used by the financial community to ana
Slide 15: EBITDA and Adjusted EBITDA Reconciliation (continued)
14 Management uses EBITDA and Adjusted EBITDA, which are non-GAAP financial measures. The Company believes that consolidated EBITDA and Adjusted EBITDA on a consolidated basis and for each segment provide supplemental information useful to investors as it is frequently used by the financial communit
Slide 16: Non-GAAP Reconciliations - Book Value per Share, as Exchanged
15 NON-GAAP RECONCILIATIONS - BOOK VALUE PER SHARE, AS EXCHANGED Management uses Book value per share, as exchanged, which is a non-GAAP financial measure. As exchanged assumes full exchange of the limited partners units of TFP for Tiptree Class A common stock. Management believes the use of this fi
Slide 17: Non-GAAP Reconciliations - Specialty Insurance
16 NON-GAAP RECONCILIATIONS - SPECIALTY INSURANCE The following table provides a reconciliation between as adjusted underwriting margin and pre-tax income for the fiscal years ended December 31, 2016 and 2015. We generally limit the underwriting risk we assume through the use of both reinsurance (e.
Slide 18: Non-GAAP Reconciliations - Specialty Insurance Products
17 NON-GAAP RECONCILIATIONS - SPECIALTY INSURANCE The following table presents product specific revenue and expenses within the specialty insurance segment for the fiscal years ended December 31, 2016 and 2015. We generally limit the underwriting risk we assume through the use of both reinsurance (e
Slide 19: Investment Portfolio Non-GAAP Measures
18 The investment portfolio consists of assets contributed by Tiptree, cash generated from operations, and from insurance premiums written. The investment portfolio of our regulated insurance companies, captive reinsurance company and warranty business are subject to different regulatory considerati
Slide 20: Non-GAAP Reconciliations - Asset Management
19 NON-GAAP RECONCILIATIONS - ASSET MANAGEMENT The Company earns revenues from CLOs under management, whether consolidated or deconsolidated, which include fees earned for managing the CLOs, distributions received from the Company’s holdings of subordinated notes issued by the CLOs and realized and
Slide 21: Non-GAAP Reconciliations - Senior Living
20 NON-GAAP RECONCILIATIONS - SENIOR LIVING In addition to Adjusted EBITDA, we also evaluate performance of our senior living segment based on net operating income (“NOI”), which is a non-GAAP measure. NOI is a common non-GAAP measure in the real estate industry used to evaluate property level opera