Conduit Holdings Limited

Good day, everyone. Welcome to the Conduit Retrading Update call for Q1 2025. Joining me on the call today are Neil Eckert, Chief Executive Officer, Elaine Whalen, Chief Financial Officer, and Nick Pritchard, Interim Chief Underwriting Officer. Please note our disclaimer language on slide two. I will now turn the call over to our CEO, Neil Eckert.

Thanks, Brett. Joining me on today's call are Elaine Whelan, our CFO, and Nick Pritchard, our interim chief underwriting officer. We are delighted to have Nick with us today in his new role as interim CEO. As mentioned in our press release a few weeks ago, Nick brings deep expertise of the markets we operate in, as well as an extensive leadership experience, and will stand us in good stead as we move through our fifth underwriting year. But it is important to stress we also have real strength in the underwriting unit across our three divisions as this quarter's growth demonstrates. As usual, today's update focuses on our top-line underwriting experience during the quarter. I will also take a moment to highlight the team-leading conduit and to provide some further clarity on our enhanced outward reinsurance strategy. Nick will then share some further details on our performance and outlook for each of our segments. And Elaine will cover the financial highlights, including some thoughts around our capital strategy. As you all would have seen, there's been some significant change in the leadership team over the last six weeks. I've accepted the chief executive role and I'm honoured and deeply committed to Conduit. It's a very personal mission to me. Rebecca Shelley, our senior independent director will step up to interim non-exec chair. Rebecca has a wealth of experience as a director or chair of UK public listed companies. Elaine and the team have been excellent over the last few months, which have been demanding to say the least. Nick has been elevated to his role as interim chief underwriting officer. As CEO, I'm here in Bermuda with the entire business team and have been for the last three months. Even prior to that appointment, we were busy effecting changes to the business model, particularly as it relates to the outward reinsurance purchase and reducing earnings volatility. And I'm working with the team to drive improvements throughout the business. Condor is guided by a highly experienced leadership team with deep and complimentary experience across the global reinsurance and insurance markets. Our executive team has decades of proven success in building and managing listed reinsurance and insurance companies. They are respected specialists in their relevant fields across underwriting, actuarial, finance, operations, and risk management. Collectively, we are committed to delivering Conduit's long-term vision and strategy. Specifically in underwriting, we have a deep team of 22 professionals This is around one third of our total workforce who leveraged their strong client and broker relationships to identify and capture high quality opportunities in target market segments. Over the long term, the incentive scheme we have in place, as outlined in our annual report and accounts, ensure the motivations of both our staff and our leadership continue to be aligned with Conduit stakeholders. Lastly, the board has commenced a search process for a permanent non-executive chair and has appointed a search firm to assist in identifying candidates. We will update you on the process as there is more information and Rebecca will be interim non-executive chair until that process concludes. Ken Randall will step up to be interim senior independent director. Turning now to our experience in the market, the first quarter of 2025. California wildfires aside, has been a quarter with continued growth. Our gross premium written increased by 15% to $410 million. While all three of our segments have always been complementary to our portfolio, growth over the last two years has been driven by property and specialty. As the market is developing, which we will go into in more detail, our growth in the first quarter will spread more equally across each of our segments, with each growing by $15 to $20 million over the prior year. Our risk-adjusted rate change net of inflation through 31st of March 25 across the portfolio was minus four. This follows several hard market years and compounding rate benefits. We are alert to rate softening in certain segments and will not grow in areas where there is in our view, insufficient margin. Regarding investments, Elaine will comment in detail, and while she wouldn't say it, her team have done a good job sticking to our strategy whilst assets under management compound. The investment return was 2.1% during Q125, compared with plus 0.5 during Q124. This driven by a high yielding portfolio and decrease in treasury yields. Our high-quality, short-duration portfolio has continued to grow in scale as the business has matured, and as at 31st of March 25, totaled over $1.9 billion. Turning to losses, as we noted back in March, our undiscounted net loss estimate related to the California wildfires remains unchanged between $100 and $140 million net of reinsurance and reinstatement premiums. The event was one of the largest insured catastrophe events seen to date, particularly for a Q1 event, with the reinsurance industry shouldering the predominant share of the loss. We continue to work closely with our sedants, who in turn are helping the victims of this disaster to rebuild their lives. As we will come on to in more detail, Our team worked proactively to secure additional reinsurance purchases to mitigate earnings volatility for the remainder of 2025. In terms of guidance for the year, the guidance remains unchanged and considering activity during Q1 2025, additional reinsurance purchases and other portfolio adjustments, we expect a full year 2025 return on equity between high single and low double digits. Our cross-cycle target over the long term remains a mid-teens return on equity. The board of directors have approved a $50 million share buyback program to enhance shareholder value. There is a slide later on in this deck on capital strategy, and Elaine will comment further. Our outwards reassurance strategy has evolved and the California wildfires highlighted the need for us not only to address the peak perils such as hurricanes and earthquake, but also secondary perils like fire, flood, winter freeze and convective storms to better align with our return objectives and a desire to reduce earnings volatility. We've taken decisive steps to address these risks. We have secured additional limits both for US and global secondary perils alongside increased aggregate cover, substantially reducing our net exposure. Whilst for commercial reasons we don't disclose details of individual reinsurance contracts, we have purchased meaningful limits for each and every event that attach within our individually disclosed or lost levels for US secondary perils and have also purchased significant additional aggregate reinsurance cover These enhancements complement our existing peak peril protections, strengthening resilience against both large-scale natural catastrophes and smaller, more frequent secondary perils. This refined approach is designed to stabilize returns for the remainder of 25 of the Atlantic wind seas. These recent purchases reflect a strategic shift on outward reinsurance, one that stresses earning stability by balancing protection against high severity in frequent events, but also smaller scale, more frequent ones. We expect this will support more consistent performance across varying risk scenarios. Looking ahead to 2026 and beyond, we plan to leverage these refinements and any changes to our inward portfolio to further optimize protection strategy. Ultimately, we do not expect these strategic adjustments will impact or detract from our ability to achieve our cross-cycle mid-teens return on equity. Turning back to our portfolio and the market, as you can see from the slide, we have continued to build scale in the portfolio into a strong pricing environment, growing 15% over Q1 2024. Over time, Expect to have more balance between quota share and excessive loss within the portfolio, with more excessive loss being written as market conditions warrant. As I mentioned, we have a very strong underwriting team in place and they are well suited to adapt to changing market conditions. We are entering a more competitive phase of the cycle and have started to see pricing come off highs, particularly property and specialties. We have seen additional opportunities in certain areas of the casualty market and expect to continue to deploy capacity here. It's important to remember that we have experienced several years of strong rate increases and the industry has generated strong returns, adding to the overall capacity in the market. Our underwriters continue to see sufficient demand across their markets and have a strong flow of deals being presented. They remain disciplined and selective in renewing or securing deals that align with our strategy. With that, I will hand over to Nick for a deeper dive into our market experience across divisions.

Thank you, Neil. I will now talk further on the premium growth for the individual business segments, along with their respective market conditions and expectations for the remainder of the year. Of the $53.4 million of growth, $20.8 million sits in the property segment, This represents year-on-year Q1 growth of 9.6%. In line with expectation, renewal negotiations were more challenging in 2024, and as a result, the risk-adjusted rate change net of inflation through 31st of March 2025 was minus 6% across the portfolio. We attribute most of this market movement to the industry deploying retained earnings, as most reinsurers remain in agreement that current pricing is adequate for peak risk. Hence, the on-running team only renewed or entered into new partnerships that were aligned with our planned strategy, whilst declining on familiar placements that continue to fall below our return requirements. With respect to demand, we observed an overall increase in limit purchased. We estimate this to be up to $12.5 billion for all regions. We expect demand to grow into Q2 and Q3, the main driver of which is Florida, totaling $20 billion of additional limit for 2025. With this in mind, we expect rates to remain adequate for the mid-year renewals. I will now turn your attention to casualty. Relative to property, this segment experienced more growth of 21.9%, or $15.1 million from Q1 2024 to Q1 2025. Most of this growth was driven by our team expanding with existing clients. This is in part due to the market's continued positive reception to Condor as we enter our fifth year of trading. Our excellent financial strength has further reinforced our position as a trusted and credible partner that enables the team to secure larger shares on preferred programs. Through extensive data analysis of our clients, we have observed evidence of positive cycle management, including appropriate management of limits, attachment points and premium rates within desired classes. There are some areas of the casualty market that continue to correct for reserve development and loss emergence, such as US excess casualty. This follows increased claims and reserve strengthening from the industry, primarily on underwriting years prior to 2020. This correction is driving rate increases, and we are benefiting from these improvements. That said, we remain heightened to the elevated loss trends, which have the potential to further offset the rating improvement. We therefore calculate the risk-adjusted rate change net of inflation through 31st of March 2025 across the casualty portfolio was minus 1%. Finally, we move on to specialty. This portfolio continues to diversify and be accretive to our risk composition outside of peak catastrophe. An increase of 24.8% from Q1 2024 to Q1 2025 has resulted in gross written premium of $88.2 million. The team successfully secured new opportunities where rates and terms remain attractive. We are participating in a market with increased supply as other reinsurers continue to seek margin and risk outside of property cap. Rates are more under pressure as students retain more risk and negotiate more firmly on commissions, terms and conditions. This is reflected in the overall risk-adjusted rate change, net of inflation of minus 3% for Q1 2025. We still view this segment as adequately priced, but we do expect growth to slow as we start to manage the book in this phase of the cycle. Thank you very much, and I will now hand over to Elaine to take you through the numbers.

Thanks, Nick. As you've heard, our growth continues into our fifth year of operations, albeit now at a slower pace, as you would expect given the rapid growth we experienced in our earlier years and also market conditions at the 1-1 renewals. We wrote $410.2 million of gross premiums written in the first quarter of the year, compared with $356.8 million in the first quarter of 2024, a 15% increase year on year. We typically write the majority of our book in the first half of the year, certainly by 1-7, but we've also seen a few renewal dates moving around for some of our students this year. We would therefore expect that first quarter growth rate to moderate a bit by the half year, and indeed the full year for that matter, although we still expect to see healthy growth for the year. Note that our gross premiums written exclude reinstatement premiums, as they are not deemed to be revenue under IFRS 17, but are included within reinsurance service expenses as a loss-related amount. Our reinsurance revenue was $213 million compared with $181.1 million in the prior year, a 17.6% increase year-on-year. For those who still need it, a reminder that under IFRS 17, our reinsurance revenue is essentially IFRS 4 gross premiums earned, less seeding commission, and a smaller adjustment for non-distinct investment components. It therefore tracks the same pattern as our gross premiums earned would have, just a lower number after the Seeding Commission deduction. Aside from the California wildfires, there hasn't been any other significant loss activity in the quarter that has impacted the company. Our previously reported estimated undiscounted net loss estimate remains between $100 and $140 million net of reinsurance and reinstatement premiums. It's worth noting that we have seen more rapid payment on this event than you might expect from the more typical property cat patterns. On the investment side, with the reduction in yields in the quarter, plus a generally higher yielding portfolio, we generated a return of 2.1%. Book yield is 4.1% in line with year end and versus 3.9% at March 31 last year. We remain relatively short duration, although have increased that very slightly since year end and our focus is on maintaining a high quality, highly liquid portfolio, particularly given the recent volatility in markets. Duration is currently 2.7 years versus 2.8 years on our net reserves. We will continue to increase our duration very slightly to better match the duration of our liabilities. Average credit quality is AA and you can see the usual pie chart here with our asset allocation and no real changes from prior quarters in that other strategy. We had a five-year plan to deploy the capital we raised at our IPO, so now that we're in our fifth year, we're looking beyond that. We have tried to explain on this slide how we think about capital. This is a question we've been getting a lot from shareholders recently. Clearly, the immediate aftermath of a significant industry loss event is an unusual time to be discussing capital returns. While we are announcing a $50 million share repurchase programme, this will be executed as and when appropriate between now and our 2026 AGM. This slide is more about laying out our philosophy. In general terms, once we've determined the capital that we think we need to support our underwriting under a variety of views, including regulatory, rating agency, plus internal views, we put a buffer on that to allow us to maintain those levels and or to take advantage of any exceptional opportunities. If we're generating profits and capital above those needs, then there is a discussion with our executive and board over what to do with that capital, hold, deploy, or return. Which option or blend of options we select would depend on a number of factors, including our market outlook and our multiple. I'll now hand back to Neil for closing comments.

Thanks, Elaine. So to wrap up, there have been meaningful changes to the leadership team over the last few weeks. but we have a very strong experienced team in place across our functional groups. We are working hard to execute our vision and strategy and improve the company's operating performance. The team is energized and motivated. We operate with a unified focus and vision and our incentives are aligned with the operating performance. There is no change in our strategy. We will remain a Bermuda pure play reinsurer and manage the cycles to generate strong underwriting returns, but also we will take action where we see a need and have done so over the last few weeks by purchasing additional reinsurance coverage. We've made targeted improvements to our reinsurance protection strategy, looking to strike the right balance between performance and volatility. These enhancements position us to navigate both peak and non-peak perils effectively. safeguarding earnings stability and supporting long-term growth and returns. Looking ahead to the mid-year renewals, we see room to selectively expand and adjust our portfolio. Our focus will remain on securing business that aligns with our strategy and with a focus on high-quality seedings where there is a proven track record of profitability. Whilst we are seeing increased capacity in competition, we remain committed to maintaining discipline aligning with market demands and delivering sustainable returns. Our strategic approach positions us well to navigate the evolving market landscape. The balance sheet is supported by a growing, high-quality and short-duration investment portfolio. The investment portfolio's liquidity, stability and relatively reliable income complement our core reinsurance operations and we enjoy the benefit of a compounding increase in AUM. We remain steadfast in our commitment to achieving a mid-teens cross-cycle return on equity. This target reflects our confidence in our strategy, operational capabilities and the ability to deliver shareholder returns over time. We are also committed to capital efficiency, having announced a share buyback programme today. The last few weeks have been intense in terms of workload and I want to thank both my team and the board for their work and support. That concludes today's presentation. Thank you for your time. We will now turn it over to Q&A.

Thank you. We will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again. If you were called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, press star one to join the queue. And your first question comes from the line of Michael Hutner of Barenburg. Please go ahead.

Thank you. Congratulations, Neil, and thanks for the informative presentation. I had just two questions. The first one is on the topic of potential reserve releases from the old years, so 22, 23, maybe even 24. And the second is on the reinsurance purchasing, whether I should be thinking about that when I build my model for 25, 26, 27. So in terms of reserve releases, I think my assumption or my thinking is that They're now older years, so whatever's been baked in can be ready to be released. And I've no idea whether there is potential to release or not or when the timing for that would be, but I'd be interested. And the second is on the reinsurance. So clearly, the cost of the extra reinsurance that I take it from now to the rest of the year is helping kind of reduce ROE a little bit. It does protect volatility. But I just wondered if the change in strategy means that I should also build into my model more reinsurance buying going forward and with potential implication for costs as well. That's it. Thank you.

Hi, Michael. It's Elaine. I'll take your first one on reserve releases. Generally, when we look at the casualty that we've been experiencing, Fairly slow to look at anything on that. We've obviously been monitoring it quite closely in terms of what we've been getting through and reported and monitoring the experience there. But we were reluctant to take too much good news on that too early. So that's something that we've been fairly conservative on. Now that we're in year five, we will start taking a closer look at that. But there's no guarantees in terms of what we might release on that. And there's probably a conversation for towards the end of this year. Around the property and the specialty, portfolios, they're really driven by the larger specific losses certainly in the earlier years of the company the kind of larger wind events that we had in there were in our reinsurance programme so they tend not to move too much on a net basis. We do have some smaller specifics that have moved around a little bit and we've seen bits and pieces here and there but nothing of any great significance yet. Again I think in year five towards the end of this year but we'll take a closer look at some of those and see what's in there that we think we might be able to take. But we have been, hopefully, as conservative as we can be over the early years of the company.

Right. Michael, I'll take the question on reinsurance. So we have purchased two types of reinsurance, per-event cover, which covers us against a catastrophic secondary peril, and then aggregate cover, which covers against a series of losses. As I said in the presentation, we don't disclose individual contracts for a number of commercial reasons, but we have said in the presentation that the attachment point or the place at which the per event cover provides a hedge is within our individually disclosable amounts per loss. So they would sit within our CAD budget And then the aggregate cover sits further sideways behind the buffer. I can't be more specific than that, but certainly the coverages have been tailored to reduce volatility, which we also know was a concern.

And does this affect RTS at 26, 27?

We will review RTS. the reinsurance purchase. And I think there may be an opportunity to integrate the secondary peril coverage into some of our protections. And in fact, this has already happened on some coverage. So I wouldn't expect there to be a material upward amount. I mean, for this year, we purchased and announced that we'd spent additional monies. It'll be an integrated part of next year's programme. And we have reaffirmed our commitment to mid-teens ROEs across the cycle. I can't be more specific than that. I mean, for next year, we are in the planning phase and looking at the program as we speak.

Very clear. Thank you. Your next question is from the line of Abid Hussain from Panmure Librem. Please go ahead.

Oh, hello. Hi there. I've got three questions, if I can. The first one was on growth. You've grown a bit faster than I was thinking in both casualty and specialty. I was just wondering if you could provide any color in sort of the lines that you've grown within those segments and the degree of price adequacy that you're seeing in those lines. And then second on pricing, you touched upon pricing. I think you said that it's looking like it might shape up to be pricing will remain adequate at the mid-year renewals. I just wanted to get a sense of what you were seeing from any early indications of negotiations that are starting to take place ahead of the one June renewals. And then just finally on recruitment, I'm just wondering if there's anything, any other recruitment that you want to do perhaps preemptively outside of the ExCo. I'm thinking really sort of N-1 level high. Is there any sort of gaps that you need to fill below the ExCo level? Thank you.

Yeah, I'll start off on your growth question and then Nick can fill in with the... the market colour. I think it's tough to look at one quarter in isolation and a number of different impacts on the gross premium numbers in there. So we don't include reinstatement premium in our gross premiums written now under IFRS 17. So that's a bit of a factor in the property numbers. We also saw some negative estimated premium adjustments coming through on property in Q1 2025, which skews those numbers a little bit, all in prior underwriting years. Conversely, on the casualty side, in Q1 2024, we had some negative estimated premium adjustments. So that does make the growth look a little higher than it might otherwise be. And specialty, we had some positive adjustments this quarter, some negative adjustments last Q1. So that impacts the growth factors there as well. So again, you know, one quarter in isolation, we are impacted by estimated premium adjustments, renewal dates moving around, all that kind of stuff. So that does have an impact.

Excellent. So just on the casualty, like I said in my update, that it does take a little time for our partners to become more akin to a new market and most of the if not all the growth is with existing with existing clients. And as much as the growth looks like 20% is actually is just an incremental increase on our existing partnerships where we are more comfortable with what they're doing. We're not we're not we're not shifting our appetite into into new lines of business. It's it's clients that we've been training with for a few years, but a little bit more comfortable with us and we just increasing our lines. So we've got very good year-on-year data, and we're very comfortable with what they're doing as a business. And in terms of the specialty, we continue to see attractive returns outside of peak catastrophe. And just like I said in our remarks, it is an era of the book that will continue

growth where growth will look to slow down um but um we did get some good traction at one one with some with some new business thanks nick so um abby you asked about recruitment so i mean that's a dynamic process we're always looking at the business as the business grows and develops uh we will identify needs and we previously discussed um a while back you know recruiting new pricing actuaries making underwriting processes more efficient strengthening operations. So the business was growing fast. We were recruiting in the early days. It's more mature now in most regards, but our job is to be constantly assessing, refining and working with the teams. So that hopefully addresses that question.

It does, thank you. Your next question comes from the line of Andreas van Empten from Peel Hunt. Your line is open.

Yes, thank you very much. I've got two questions, please. Just a question around your peak exposures. If I look at your presentation, you've said you've got broader protection pretty much across the board, so not only for secondary but also for peak perils. I just wanted to check going back to your disclosure in February. You said you were planning to sort of have a PML of around 10.5% of NAV on a 100-year basis. I just wondered with the resetting of your AdWords reinsurance program where these PMLs have changed at all. I know that you were sort of below your risk appetite at the 1st of January. I just wondered whether you're going to stay at that one-gen risk appetite, or should we assume that we're going towards that sort of fully loaded 1 in 100 net PML by the summer? And my second question is, with your new retro program, did this release any capsule? Is there a reduction in your capsule requirements? on the back of the change in your outward strategy. Thank you very much.

Right. Yeah, I'll take the first question on PMLs. So our PMLs are largely unchanged. And the PMLs that we tell the market are based on peak peril, so quake and catastrophic wind. And the additional coverage we purchased is for... secondary perils, both on an each and every basis and an aggregate basis. So they do not have a net impact on our PMLs, which are roughly running sort of as planned and through previous disclosures. I mean, as the year goes on, we will write more business. So, you know, just naturally in terms of new business submissions and renewals. So they will go up during the year, but But for now, they're sort of stable and as per previous disclosures. I'll pass over to Elaine to discuss capital.

Hi, Andreas. I think the short answer is not material impact. I think they bought mostly secondary pearl cover. And so it's more of an economic purchase than a capital relief purchase. And we did have a fair amount of capital protection in place already. So it wasn't really about capital trade.

All right, perfect. Thank you very much.

The next question comes from the line of Mandeep Jagpal from RBC Capital Markets. Please go ahead.

Hey, thanks for taking my questions. Mandeep Jagpal, RBC Capital Markets. The first one is just on the investment portfolio. Has there been any change in risk appetite since the period end as market volatility has increased and spreads have widened? And the second question is on the capital stack and the capital requirements presented on slide 13. a very helpful chart there. It would be even more helpful if we had some guidance in terms of the capital ratio, where those various dotted lines are, or is this something, or is this more of a case of requirements that change over time? Thank you.

Hey, Mandy, it's Helene here. Welcome to Covering the Company. You might get used to me saying no a lot when I answer questions. around the capital requirements. I think what we're trying to do there is to set out how we're thinking about it and not put any hard numbers on that. Those numbers will move around year on year, depending on where we are and depending on what kind of hedron buffers that we want to apply. So this is early stages. You'll probably hear more from us over time on that as we kind of develop that out. On the investment side of things, no real change in risk appetite. We do take a longer term view over the portfolio. We are really high quality, highly liquid, pretty short duration portfolio. So although there's a lot going out and, you know, we certainly don't have a crystal ball on what's going to happen next. I think we're more focused on that capital preservation and liquidity on the investment portfolio.

Thank you.

The next question is from the line of Joseph Tienes of Autonomous. Please go ahead.

Can you hear me? Yep. Great. Thank you. Thank you for taking my questions. The first is on slide 13 again. A lot of peers in the sector give an indication of what their sort of targeted solvency range is. I'm just wondering if you would give a number around that, not necessarily the headroom, but just sort of the solvency target range. And then secondly, I just want to ask about your growth appetite and property. Based off what we've heard from some of your peers, as well as brokers, it looks like the pricing at mid-years will be similar to that at 1.1. If that's the case, will you hold back again? I'm just curious to see, you know, how that sort of evolves from your comments at the full year and, you know, based on 1.1. Thank you very much.

Hi, Joe. I'll take the first one on the solvency. I think we've previously put up some slides kind of indicating on a pure solvency basis, we'd be kind of comfortable in the kind of 200 to 300% range. Our... Financial Condition Report will be published later today, so you'll get the full detail then. We did also put an estimated number in our annual report and accounts in February. We are slightly lower than that number now, and that's really just a feature of, in terms of kind of bound but not incepted business, bringing a little bit more in there and adjusting that for loss impacts. So that will be a bit lower, but very, very comfortably within that range that we'd put out there previously.

Sorry, Elaine, you sort of dropped out for a second. You said 200 to what range? 200 to? 300. I think we had a chart. Just 200.

200 to 300, Josie.

Oh, sorry. Sorry, I missed the 300. Thank you.

We had a chart on the Uranus investor deck, I think.

Okay, I'll take a look at that. And Josie, I don't know if you heard that, but our BSCR, FCR update comes out later on today.

Yes, yeah, I got that. So I'll take a look at that as well. Thanks. I think your other question was... Sorry, you were... Yeah.

Hi, Joseph. So the expectation is that we'll look to execute on... on plan um as you know in in the in the mid-year it's a slightly different profile of business and opportunity and so um with florida and the and the notes in the um earlier in the presentation that um Florida is looking for increased demand. Florida in our portfolio is still attractive. And so I think with our expectation of where rate is going, we still see that to be perfectly adequate. And we see no reason not to execute on what we previously said in terms of our, well, agreed with our plan.

Can you remind me of that quickly? Sorry.

Yeah, so, I mean, it's for continuous growth. I wouldn't give growth forecasts on a per-segment basis, but what I'd do is sort of, I mean, you will be aware of analyst consensus forecasts and you're aware of what we've achieved in Q1. So I would say it's sort of similar approach and similar strategy.

Okay, thank you. You have a follow-up question from Michael Hutner at Barenburg. Please go ahead.

Thank you very much. Just on the wildfires, I just wondered, can you, within that 100 to 140 million range, where's the most likely outcome? I think most of your peers have come out below the top end of the range they originally guided to. So I'm thinking Hannover and Munich and school. But I'd be interested in just to get your feel of where you might be or how conservative your estimate is. And then just on the BSCR, I think it's right. Can you remind us what the number was? I couldn't find it. I'm really sorry. And then the final question, which is really silly. I should know the answer. The 2.1%, does that apply to the 1.9 billion total cash and investments or is that applied to a smaller figure? Thank you.

Hi, Michael. I think there are some other companies that I think are still putting out ranges. We're pretty comfortable with ours. We don't disclose a great deal of detail at the trading updates, but very comfortable in that range. And we will update more on that number at the half year. On the BSCR, the estimated number that we published at year end was 269%. As I just mentioned on another question, we will be lower than that, just given the extra cut of data that we pulled into the calculation for the final version. And the 2.1% is on our managed assets. So it's pretty much most of our cash and investments. There might be a little bit of operating cash that's excluded from that.

Just on the last one, 2.1% is on the managed assets. And you said this is a lower figure than the 1.9%.

I think the 1.9% that we put in there is our managed assets number. So that excludes any operating cash, which is really de minimis.

Okay, okay, okay, okay. Cool. Thank you so much.

You're welcome.

Before we continue on to the next question, a reminder, if you would like to join the queue, to please press star one. And you have a follow-up question from Joseph Teans of Autonomous. Your line is open.

Hi there. Thanks for taking my follow-up questions. Just two at this stage. I just want to confirm that your combined ratio guidance is still in place from previous communications. So that's the first. And the second is just around the capital return strategy. Just curious why a buyback was chosen today over, say, a special dividend and whether a special dividend would be considered in the future or would it always be buybacks? Thank you very much.

Hi, Joseph. I'll take those. And combined racial guidance. I mean, this year aside, we're not making any changes to that. I think we've kept our guidance across the cycle. So nothing to change there. If we have anything to communicate in that going forward, then we'll do so. But as is for now, on the capital return, the buyback is part of our toolkit. in terms of what we think about in terms of capital returns, we've got our order dividend, we will consider buybacks and special dividends for excess capital. And the decision between the two or whether to do both will be driven by where we are from a multiple perspective, our view of our valuation, what we think our shareholders want, all those things. And I'm sure other things I've missed as well.

And there are no further questions on the conference line. I will now hand over to Neil for closing remarks.

Yeah. So thanks everybody for your time. It's yeah, we're pleased to have made the announcements we have this morning. The half year will be the next time that we make announcements. So it's, on with the business. And please feel free to reach out individually if any of you want follow-up meetings. So thank you very much. Cheers.