Conduit Holdings Limited

Good morning and good afternoon, everyone.

Welcome to Conduit's full year 2023 preliminary results call. With the disclaimer now relegated to the end of the presentation, I give the floor to Neil Hecker, our executive chairman. Thanks, Antonio. Our results are reflective of both market conditions and the progress that we've made as a company. Without further ado, I'll pass to Trevor Carby, our CEO, Greg Roberts, our CEO, and Elaine Whelan, our CFO. They will run through our results presentation, and then we will move on to Q&A.

Thanks, Neil. Good morning. We have commented previously on our third year of underwriting being an important one for us. It's the year we expected to achieve scale and maturity in our earnings base, and the numbers on this page show that out. Elaine will go through the finer details later. But suffice to say, we are quite delighted to be reporting comprehensive income of $190.8 million for the year and an ROE of 22%. With gross premiums written rising to $931 million and a discounted combined ratio of 72.1%, the business has performed really well in delivering on its numbers in 2023. 2023, of course, didn't see any major hurricanes making landfall in the US. But even so, it has been another year of greater than 100 billion of globally insured cap losses. And whilst this has been incurred right across the insurance and reinsurance industry, our share of these secondary perils losses has remained very manageable. That, when combined with reaching a level of maturity in our earned premium, along with strong investment performance, particularly in the fourth quarter, has driven our results for the year. We had a considerable amount of growth this year, well ahead of our initial IPO plan expectations. While we don't expect to always reproduce that level of growth year on year, we are still in growth mode generally and do expect to see a further uplift in 2024 and subject to market conditions again in 2025. We have more than enough capital to support those goals and aspirations, so we look forward to the coming years with enthusiasm. Our estimated BSCR ratio at 381% is a reduction from the prior year, as you would expect, as we deploy the capital raised. That ratio is still high, though, certainly relative to peers and relative to where we expect it to settle as we achieve what I will loosely refer to as our steady state. While there are a number of complexities around any compensation on capital, as we look out over the coming years, we have more than enough capital to take advantage of current market conditions. Across each of our three divisions, we saw good fundamentals through the year, with renewals and new business alike contributing, with gross premiums written increasing to $931 million, up from the $622 million in 2022. As regards rate and rate change, Greg can talk more specifically to that in a while, but overall at a 16% weighted risk adjusted change, the year continued to deliver healthy pricing margins and the trading environment was extremely robust. In property, our growth was driven by the strong underlying market pricing, especially in the DNF and the non-limited arenas. This is where solid rate adequacy and margin continues to be present. These areas are very much the place to be in property in our view and has afforded us the ability to scale there significantly. An opportunity which we identified over two years ago when these markets started to show signs of an emerging step change. Also, I would add that on our property growth, given our risk profiles and deals written, we were able to choose to very manageable levels for peak zone net cap perils. On specialty, our book showed strong fundamentals through the year, and whilst we continued to remain cautious in deploying more into the political violence and terror space, where policy wordings and coverage terms sometimes still foreshadowed in our view, the specialty account as a whole delivered a good blend of risk adequacy, margins, and low peak zone caps usage, which is a key measure for us. Casualty as a division showed our lowest rate of growth at just 17% year on year, and that reflected our broader view on the dynamics present. With the rate being achieved, absolutely must be enough to stay ahead of the underlying claims trends. In some cases, we didn't see this and consequently deployed less into the space. We do have a large submission flowing casualty, though, and that has enabled us to still be pretty selective in where and how we choose to play. This trend line shows the operating expense ratio, and we have spoken before of the scalable efficiencies that we have as a pure play reinsurer here in Bermuda. We have referenced before this expected progression in our other operating expense ratio, and the falling trend continued in 2023, with the ratio falling to 5.1%. from the 6% in the previous year. On the topic of scaling and general efficiencies created in the business as we grow, a slide here laying out the gross premiums written per full-time employee over the three years to date. And for the 2023 year, it stands at $15.8 million per employee, up from $11.5 million a year ago. This slide does, of course, show the differentiation for a pure reinsurer with a clean structure and without the attendant costs of the infrastructure needed to distribute and administer large volumes of insurance policies. The benefits of our operating structure do go beyond pure cost, though, as it is also about efficient decision-making and spotting key market trends and directional changes, and having management and the whole team in one location is something that Condra has really benefited from over our first three years. Thanks for your time, and on that note, I'll hand over to Greg.