Everest Group, Ltd. · NYSE:EG
Everest — Everest Re Group — Q4 2018 Earnings Presentation
18 slides from Everest's earnings presentation, 2019
Slide 1: Investor Presentation Fourth Quarter 2018
INVESTOR Presentation FOURTH QUARTER 2018 Everest Re Group, Ltd Seon Place, 4th Floor 141 Front Street P.O. Box HM 845 Hamilton HM D19, Bermuda
Slide 2: Cautionary Note on Forward-looking Statements
CAUTIONARY NOTE ON Forward-looking Statements This presentation contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the U.S. Federal securi
Slide 3: Corporate Objectives
CORPORATE OBJECTIVES Everest Re Group is a worldwide multi-line reinsurance and insurance organization. Our key objectives are to: Maximize total value creation over time, and Achieve long term double-digit compound annual growth in shareholder value. Total Value Creation (Growth in book value p
Slide 4: Long Term Performance
LONG TERM Performance DEMONSTRATES STRONG CYCLE MANAGEMENT 5 Year 10 Year ITD Key Profitability Measures 2014-2018 2009-2018 1996-2018 Combined Ratio* 94.8% 95.9% 97.5% Pretax Operating ROR** 14.0% 14.2% 14.1% Operating ROE** 10.3% 10.2% 11.1% Shareholder Value (Compound Annual Growth Rate) 8.1% 10.
Slide 5: Financial Highlights
FINANCIAL HIGHLIGHTS $ IN MILLIONS For the year ended December 31, ($ in millions) 2018 2017 2016 2015 2014 Income Statement Data: Gross Premiums Written $8,475.2 $ 7,173.9 $ 6,033.9 $ 5,891.7 $ 5,762.9 Net Premiums Earned $6,931.7 5,937.8 5,320.5 5,292.8 5,043.7 Net Investment Income 581.2 542.9 47
Slide 6: Everest - Fundamental Strengths
EVEREST - FUNDAMENTAL STRENGTHS Rock Solid Balance Sheet: $7.9B GAAP Equity 7.4% debt to capital $18.4B investment portfolio with Aa3 average rating Highly diversified business mix (2018 data): 73% Reinsurance / 27% Insurance 50% Property / 50% Casualty 5.4% expense ratio and 2.8% fo
Slide 7: Experienced Management Team
EXPERIENCED MANAGEMENT Team EVEREST RE GROUP SENIOR EXECUTIVES Dominic Addesso President and Chief Executive Officer John Doucette Jonathan Zaffino Craig Howie Sanjoy Mukherjee Ralph Groce Gail Van Beveren EVP and President EVP and President EVP and Chief EVP, General SVP and Chief Senior Vice and C
Slide 8: Multiple Distribution Channels
MULTIPLE DISTRIBUTION Channels UNDERWRITING TEAMS IN KEY LOCATIONS TO MAXIMIZE GLOBAL OPPORTUNITIES REINSURANCE INSURANCE LOCATIONS: LOCATIONS: United States United States Chicago, IL Atlanta, GA Liberty Corner, NJ Boston, MA Miami, FL Chicago, IL New York, NY Houston, TX Walnut Cr
Slide 9: Leading Global Reinsurer
LEADING GLOBAL Reinsurer Everest Reinsurance Ops 2016 2017 2018 2018 GWP Geography Gross Written Premium $4,246.8 $5,114.7 $6,224.6 51% United States 21% Europe (incl. UK) Combined Ratio 77.6% 103.1% 113.0% 12% Latin America/South America Attritional Combined Ratio 81.1% 81.1% 84.0% 5% Middle East/A
Slide 10: A Premier Global Specialty Insurance Operation
A PREMIER GLOBAL Specialty Insurance Operation Everest Insurance Ops Selective expansion of the portfolio towards 2016 2017 2018 specialty markets Gross Written Premium $1,787.0 $2,059.2 $2,250.6 Multi-channel distribution strategy Leverage underwriting talent and infrastructure to Combined Ra
Slide 11: Strong Risk Management Culture
STRONG RISK MANAGEMENT CULTURE WITH CONSIDERABLE FINANCIAL FLEXIBILITY AND CONSERVATIVE PROPERTY CATASTROPHE EXPOSURE PML as Percent of Total Shareholders' Equity As of 10/1/18, Ranked by 1-250 30.0% 20.0% 10.0% 0.0% ACGL AHL RE AXS VR XL LRE 1-100 1-250 Source: Dowling RE’s PMLs as disclosed in 201
Slide 12: A Strategy That Embraces Alternative Capital Paradigm
A STRATEGY THAT Embraces Alternative Capital Paradigm CAPITAL MARKETS ADD TO EVEREST’S CAPACITY AND INCREASE NET MARGINS 2013 2014 2015 2017 2018 MT LOGAN KILIMANJARO RE LTD. KILIMANJARO RE LTD. KILIMANJARO RE LTD. KILIMANJARO RE LTD. (SERIES 2014 -2) (SERIES 2015-1) (SERIES 2017- 1&2) (SERIES 2018-
Slide 13: Active Capital Management Improves Shareholder Value
ACTIVE CAPITAL MANAGEMENT Improves Shareholder Value BOOK VALUE PER SHARE HAS INCREASED 2.5x SINCE 2006 Capital Management: $204.95 $197.45 $194.43 Everest historically $178.21 addresses excess $166.75 capital through share $146.57 12,856 12,484 buybacks $130.96 $115.45 $102.87 $112.99 10,615 11,1
Slide 14: Conservative Leverage and High Liquidity
CONSERVATIVE Leverage and High Liquidity FIGURES AS OF 12/31/18 Capitalization Liquidity 100% 15.0 90% 80% 29% Corporate 70% 22% Non U.S. 10.7 60% 14% Mortgage/ Asset Backed 50% 10.0 14% Government 40% 7.8 5% Cash & Short Term 7.7 7.4 30% 7.3 7.0 4% Equity 6.5 20% 3% Municipal 10% 9% Other 0% 5.0 20
Slide 15: Strong and Consistent Operating Cash Flows
STRONG AND CONSISTENT Operating Cash Flows ADD TO STRONG LIQUIDITY PROFILE '11 Japan EQ & '18 '08 Thai Floods CA fires, Hurr Michael & '04 Hurr Ike Florence, Asia FL Hurricanes Pacific/Australian Events* $9.0 '05 '08-'09 '12 $2.5 '01 KRW Hurr '17 WTC Attack Financial Hurricane Crisis/ Sandy Hurr HIM
Slide 16: Significant Total Return to Shareholders
SIGNIFICANT TOTAL Return to Shareholders 1,375.9% 600% 568.5% Everest 500% S&P 500 400% 300% 255.8% 242.8% 239.6% 195.3% 207.0% 200% 129.8% 100% 56.1% 50.3% 0% 5 Years 7 Years 10 Years 15 Years Inception to Date Everest Re total return* over S&P 500: 2013-2018 2011-2018 2008-2018 2003-2018 ITD 6 poi
Slide 17: The Everest Franchise - Well Positioned for Success
THE EVEREST FRANCHISE—Well Positioned for Success A BUSINESS MODEL THAT IS NOT EASILY REPLICATED FOCUS ON SHAREHOLDER VALUE LEADING THE MARKET SIGNIFICANT SCALE 11.4% CAGR in Dividend Adjusted BVPS since 1995 40+ years 25 of Market Experience Top Ratings Offices Worldwide A+ A.M. Best & S&P 5+ Point
Slide 18: Everest Re Group, Ltd.
EVEREST RE GROUP, LTD. Seon Place, 141 Front Street, 4th Floor, P. O. Box HM 845, Hamilton HM 19, Bermuda