Greenlight Reinsurance, Ltd.

Thank you for joining the Greenlight Re conference call for the first quarter of 2022 earnings. The company reminds you that forward-looking statements may be made on this call are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical fact, but rather reflect the company's current expectations, estimates, and predictions about future results and events and are subject to risk uncertainties and assumptions, including those enumerated in the company's Form 10-K for the year ended December 31, 2021, and other documents filed by the company with the SEC. If one or more risks or uncertainties materialize, or if the company's underlying assumptions prove to be incorrect, actual results may vary materially from the company's projections. The company undertakes no obligation to update publicly or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. After the prepared remarks, we will be conducting a question and answer session. For those that would like to ask a question, please press star then 1 to be added to the question queue. I would now like to turn the call over to Greenlights RECEO, Mr. Simon Burton. Please go ahead, sir.

Good morning, everyone, and thanks for joining the call. The first quarter of the year used to be considered a benign period for the reinsurance industry, with only the occasional large loss. Those days seem distant now. Two years ago, we were contemplating the impact from the onset of COVID. Last year, winter storm Yuri set new weather records. And this year, Ukraine has endured a massive ground invasion, while Russia is facing extensive economic sanctions. During the first quarter, we recognized $13.6 million of losses from the Russian-Ukrainian conflict, which contributed 10.8 percentage points to our 106.2% combined ratio. While the conflict's impact on our combined ratio is substantial, it reflects the growth in our short-tail specialty business that is otherwise performing well. The Russian-Ukrainian conflict is highly complex. particularly as it relates to the impact of Russian sanctions. I'd like to highlight a few points about our reserve estimate. The loss estimate relates to an IBNR provision on losses incurred up to March 31st, 2022. We have not received any reported losses to date. Our estimate includes an assessment of losses incurred in both Ukraine and Russia, A portion of our exposure to the conflict, including marine, energy, political violence, terror, and whole account risks, is protected by a retrocessional policy that attaches at $10 million and provides $20 million of coverage to us. The first quarter loss estimate does not reach the attachment point of this cover. At the start of my remarks, I've referred to the apparent disappearance of periods without significant industry events. Not surprisingly, we are seeing the withdrawal of reinsurance capacity in response to poor profitability of the industry over the past few years. The other side of this picture is that market conditions continue to improve. Market studies have suggested that rates overall have improved in each of the last 17 quarters, and the Russian-Ukrainian conflicts and reduction in underwriting capital are likely to continue supporting that trend, at least with respect to the short-tail specialty classes. And despite the scarcity of event-free quarters we've seen recently, we believe that no trends continue forever. Looking forward, as our non-renewed, lower-margin business runs off over the next few quarters, we're expecting to see the impact of better business mix and continued rate improvement reflected in our results. In April, we launched the Greenlight Innovation Syndicate 3456 under the Lloyds Syndicate in a Box initiative. Our innovations unit is central to the company's strategy, and the syndicate will help us support our existing partnerships as well as grow our InsurTech portfolio. During the first quarter, we made additional investments and generated $4 million of unrealized gains, reflecting the continued strong market interests in our innovation partners. Now I'd like to turn the call over to David.

Thanks, Simon, and good morning, everyone. The Solace Glass Fund returned 1.7% in the first quarter. Shorts, including index positions, contributed 4.9%, macro contributed 3.5%, and longs detracted 6%. During the quarter, the S&P 500 index declined by 4.6%. Our long positions in Consul Energy, Ryan Mattel, and Tech Resources, and our macro position in inflation swaps were our largest positive contributors. Greenberg Partners, our largest long position, was our largest detractor. Consul Energy and Tech Resources stock prices advanced 66% and 42%, respectively, following price surges from metallurgical and thermal coal. Rheinmetall stock price climbed by 131% in the first quarter as Russia's invasion of Ukraine dramatically changed the outlook for European defense spending. About three-quarters of Rheinmetall's business is military-related. Our position in long inflation swaps benefited as the market began to price in its doubts about the Fed's wherewithal to return inflation to its 2% target. Even as the Fed adjusted the market's expectation to a faster tightening cycle, inflation expectations continued to increase. This benefited our gold position as well. Greenbrick's share fell 35% during the first quarter, with nothing company-specific to account for the drop. In fact, the blowout earnings released last night indicate that current business performance is excellent. However, the homebuilding sector derated as the market formed a view that the sharp rise in interest and mortgage rates will be the cause for a repeat of the 2008 housing crisis. We believe the comparison and the fear that is accompanied it to be misguided. Due to a decade of underdevelopment, the U.S. is experiencing a severe shortage of housing. Further, homebuilders currently have low financial leverage. There's significantly less speculation and lending underwriting standards are tighter. While higher mortgage rates might have an impact on demand, at this point, home builders are more constrained by supply. We continue to be focused on the global inflation problem, and now at least we believe that the Fed understands the problem. While it sounds serious about fighting it, the Fed has done little to help the problem other than talk about it. It's kind of like the opposite of the main rule from the movie Fight Club. If the Fed was serious about stopping the inflation problem, we believe it would be as aggressive and creative and tightening as it is when it was easing. While inflation is set to drop from its current 8.5% year-over-year rate, we do not expect the Fed to be sufficiently aggressive in fighting it. It is likely inflation will remain persistently above the 2% target. The Solace Glass portfolio returned 6.9% in April and has returned 8.7% year-to-date. Net exposure was approximately 26% net long at the end of the first quarter and roughly 30% at the end of April. Now I'd like to turn the call over to Neil to discuss the financial results.