NEWS

Press Release

TRISURA GROUP REPORTS FOURTH QUARTER AND 2020 ANNUAL RESULTS

TORONTO, Feb. 10, 2021 — Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance provider, today announced financial results for the fourth quarter and year ended December 31, 2020.

David Clare, President and CEO of Trisura, stated, “We are pleased with Trisura’s progress, generating net income of $10.9 million in the fourth quarter and $32.4 million for the year – both significant increases over the prior periods. Strong results in Canada, accelerating profitability in the US, improved asset liability matching in our Reinsurance business and investment gains produced a 13.4% return on equity, approaching our mid-teens target ahead of plan.

In the context of significant top-line growth in Canada, disciplined underwriting generated a strong 85.5% combined ratio for the year. Our US business maintained its trajectory of growth, binding a new record of $210.7 million of gross premiums and generating $5.7 million in net income in the quarter, almost matching our Canadian quarterly profit.

Our balance sheet is well-funded to support future growth, with flexibility afforded by our 8.7% debt-to-capital ratio.”

Highlights

  • EPS of $1.05 in Q4 2020 and $3.28 for the full year compared to $0.47 and $0.69 respectively in 2019.
  • Book value per share of $28.23, an increase of 30.8% from December 31, 2019, driven by strong earnings and a book-value accretive equity raise.
  • Gross and net written premiums growth of 119.4% and 122.9% in Q4 2020, and 106.7% and 69.2% for the full year was supported by momentum in US fronting and continued growth in Canada.
  • Net income of $10.9 million in the quarter and $32.4 million in full year 2020 grew 162.4% and 536.9% compared to prior year, respectively, driven by strong growth and underwriting in Canada, a growing contribution to profitability in the U.S, improved asset liability matching in our Reinsurance business and investment gains.
  • ROE of 13.4%, compared to 3.5% in 2019, approaching our mid-teens target despite dilution from our equity raise in May 2020, and achieved in the context of significant growth.
  • Premiums grew in our Canadian business by 116.5% in Q4 2020 and 51.5% for the full year. Exceptional surety performance contributed to achieving an 87.3% and 85.5% combined ratio for the quarter and year respectively and a 19.9% ROE.
  • Sustained growth in our US business, producing $210.7 million in GPW in the quarter and $647.2 million for the year, contributed to improved net income of $5.7 million and $16.4 million respectively, reaching a 11.7% ROE despite an increase in the capital base.
Amounts in C$ millions Q4 2020 Q4 2019 Variance 2020 2019 Variance
Gross premiums written       314.2     143.2 119.4%        926.4       448.3 106.7%
Net income         10.9         4.2 162.4%          32.4          5.1 536.9%
EPS – diluted, $         1.05          0.47 123.4%          3.28           0.69 375.4%
Adjusted EPS – diluted, $         0.96          0.57 68.4%          3.68           1.92 91.6%
Book value per share, $       28.23 21.58 30.8%        28.23 21.58 30.8%
Debt-to-Capital ratio 8.7% 13.5% (4.8pts) 8.7% 13.5% (4.8pts)
ROE 13.4% 3.5% 9.9pts 13.4% 3.5% 9.9pts
Adjusted ROE 15.0% 9.4% 5.6pts 15.0% 9.4% 5.6pts
Combined ratio – Canada 87.3% 82.9% 4.4pts 85.5% 87.8% (2.3pts)
Fronting operational ratio – US 68.5% 78.9% (10.4pts) 70.6% 88.9% (18.3pts)

COVID-19

  • Trisura staff globally continue to work effectively from home. We have introduced safety measures in physical offices in preparation for a gradual return to work acknowledging best practices and local jurisdiction protocols.
  • Despite resilience in the quarter and through the year, a recent second wave globally, and a weaker than anticipated economic recovery may threaten momentum.
  • Premium generation and claims activity may be impacted depending on the length and depth of the pandemic-related economic slowdown, as well as the effectiveness of government support programs and vaccines. Depending on these factors, premium growth could slow and claims activity could increase.

Insurance Operations

  • Disciplined underwriting in Canada, achieving a loss ratio of 25.3% for the year, and strong expense management resulted in a combined ratio of 85.5%.
  • Strong growth in our US platform, with GPW of $210.7 million in Q4 2020 compared to $171.0 million in Q3 2020, and fee income of $8.5 million in Q4 2020 compared to $6.4 million in Q3 2020.
  • Improved asset-liability matching in our Reinsurance business limited volatility through the year.

Capital

  • The minimum capital test (“MCT”) ratio of our Canadian operations was 249% as at December 31, 2020 (258% as at December 31, 2019), which comfortably exceeded regulatory requirements of 150%.
  • Trisura Specialty’s capital of $122.6 million USD as at December 31, 2020 ($83.3 million USD as at December 31, 2019) was in excess of the various Company Action Levels of the states in which Trisura Specialty is licensed.
  • Consolidated debt-to-capital ratio of 8.7% as at December 31, 2020 is below our long-term target of 20.0%.

Investments

  • Investment income was $5.9 million in Q4 2020 and $27.8 million for the year, an increase from a loss of $3.9 million in Q4 2019 and $16.2 million in 2019. These increases were primarily a result of the impact of movements in European interest rates on the longer duration assets supporting our Reinsurance business liabilities, supported by additional interest and dividend income in North America.
  • In Canada and the US, interest and dividend income rose 25.8% and 28.2% in Q4 2020 and for the year versus the prior period, respectively. The US portfolio benefited from improved diversification after rebalancing through COVID-related volatility, and increased capital following the equity raise in May 2020.
  • Net gains were greater in Q4 2020 and for the year as a result of favourable foreign exchange movements and greater realized gains.

Corporate Development

  • Trisura continues to grow its admitted licenses, with 46 state licenses today and the intention of securing admitted licenses in all 50 states.
  • In the quarter Trisura bound $11.2 million USD in admitted premiums; we expect the admitted business to be a more significant opportunity for growth in 2021.
  • In November 2020, A.M. Best reaffirmed the financial strength rating of A- (Excellent) for both the Canadian and US operations.

Financial Statement Presentation – Update

  • We have adjusted our presentation of the Consolidated income statements to reflect a more representative view of our business, removing net underwriting income, which in the context of a business with life reserves on the Balance sheet, diluted the utility of the measure.
  • Adjusted EPS and adjusted ROE have been introduced, to adjust for non-recurring items and normalize earnings for core operations, providing a more representative depiction of the run-rate operations of the business.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Trisura Group Ltd.
Consolidated Statements of Financial Position
As at December 31, 2020 and December 31, 2019
(in thousands of Canadian dollars, except as otherwise noted)

As at December 31, 2020 December 31, 2019
Cash and cash equivalents  136,519  85,905
Investments  503,684  392,617
Premiums and accounts receivable, and other assets 178,883  86,669
Recoverable from reinsurers 676,972  293,068
Deferred acquisition costs  188,190  104,197
Capital assets and intangible assets  13,907  14,477
Deferred tax assets  8,577  1,460
Total assets  1,706,732  978,393
Accounts payable, accrued and other liabilities  57,343  40,916
Reinsurance premiums payable  151,707  80,186
Unearned premiums  592,711  328,091
Unearned reinsurance commissions  100,281  51,291
Unpaid claims and loss adjustment expenses  487,271  257,880
Loan payable  27,555  29,700
Total liabilities  1,416,868  788,064
Shareholders’ equity  289,864  190,329
Total liabilities and shareholders’ equity 1,706,732  978,393

Trisura Group Ltd.
Consolidated Statements of Comprehensive Income
For the three and twelve months ended December 31
(in thousands of Canadian dollars, except as otherwise noted)

  Q4 2020 Q4 2019 2020 2019
Gross premiums written  314,200  143,212 926,442  448,262
Net premiums written 88,400  39,656 241,324  142,628
Net premiums earned 51,091  29,710 160,684  107,504
Fee income  9,659  3,575  29,719  12,206
Net investment income (loss)  5,922  (3,868)  27,779  16,243
Settlement from structured insurance assets  –  –  –  8,077
Net gains (losses)  2,822  (92)  8,450  1,572
Total revenues  69,494  29,325 226,632  145,602
Net claims and loss adjustment expenses (23,096)  (687) (72,562)  (49,936)
Net commissions (17,484)  (9,677) (55,915)  (37,516)
Operating expenses (14,037)  (12,464) (57,560)  (45,590)
Interest expense  (222)  (341)  (1,113)  (1,361)
Total claims and expenses (54,839)  (23,169) (187,150) (134,403)
Income before income taxes  14,655  6,156  39,482 11,199
Income tax expense (3,706)  (1,984)  (7,040) (6,105)
Net income  10,949  4,172  32,442  5,094
Other comprehensive income (loss)  2,800  (1,188)  96  808
Comprehensive income  13,749  2,984  32,538  5,902

Trisura Group Ltd.
Consolidated Statements of Cash Flows
For the three and twelve months ended December 31
(in thousands of Canadian dollars, except as otherwise noted)

  Q4 2020 Q4 2019 2020 2019
Net income from operating activities       10,949         4,172        32,442             5,094
Non-cash items        (3,628)       11,406          2,378             9,898
Stock options granted            189            138            729                502
Change in working capital       23,958         9,744        81,412           49,726
Realized gains on investments        (1,223)            (60)       (22,666)            (2,860)
Income taxes paid        (1,860)           (114)         (9,808)            (2,573)
Interest paid           (223)           (354)         (1,144)            (1,410)
Net cash from operating activities       28,162       24,932        83,343           58,377
Proceeds on disposal of investments       37,776       13,805      238,827           55,452
Purchases of investments      (50,152)      (79,741)     (331,933)        (170,817)
Net purchases of capital and intangible assets           (673)        (2,723)         (1,296)            (3,131)
Net cash used in investing activities       (13,049)      (68,659)       (94,402)        (118,496)
Dividends paid                –            (24)                 –                (96)
Shares issued                   –                –        65,143           55,669
Preferred shares redeemed                –        (1,600)                 –            (1,600)
Loans received       11,459                –        44,159                    –
Repayment of loan payable      (11,459)                –       (44,159)                    –
Lease payments           (318)           (266)         (1,515)            (1,026)
Net cash (used in) from financing activities         (318)        (1,890)        63,628           52,947
Net increase (decrease) in cash       14,795      (45,617)        52,569            (7,172)
Cash at beginning of the period      124,875     131,913        85,905           95,212
Currency translation        (3,151)           (391)         (1,955)            (2,135)
Cash at the end of the period      136,519       85,905      136,519           85,905

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Company and its subsidiaries, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “likely,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could”.

Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of our Company to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: developments related to COVID-19, including the impact of COVID-19 on the economy and global financial markets; the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behaviour of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; changes in capital requirements; changes in reinsurance arrangements; ability to collect amounts owed; catastrophic events, such as earthquakes, hurricanes or pandemics; the possible impact of international conflicts and other developments including terrorist acts and cyberterrorism; and other risks and factors detailed from time to time in our documents filed with securities regulators in Canada.

We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP LTD. APPOINTS GEORGE R. JAMES TO LEAD U.S. SURETY OPERATIONS

Oklahoma City, Oklahoma, NOVEMBER 30, 2020 – Trisura Group Ltd. (“Trisura”) (TSX: TSU) is pleased to announce the appointment of George R. James as Chief Underwriting Officer, Surety, for the organization’s new U.S. surety platform. This appointment will be effective January 4, 2021. George will lead Trisura’s entry into the U.S. surety market and head its U.S. surety operations.

George is a seasoned surety leader with 25 years of experience, extensive market knowledge and deep-rooted relationships across the United States. George’s career includes 14 years in executive leadership positions at International Fidelity Insurance Company (“IFIC”), including the role of Executive Vice President and Chief Underwriting Officer. At IFIC, George was instrumental in the strategic positioning and operations of the company and delivered consistent and profitable underwriting results. In addition, George was a past Chair of the Commercial Surety Advisory Committee of the Surety & Fidelity Association of America. Trisura looks forward to drawing on George’s leadership capabilities as we expand in the U.S. market.

With the launch of Trisura’s U.S. surety operations, agents and brokers will be able to access a North American platform including Trisura’s Canadian operations, currently the third-largest surety provider in Canada. Trisura’s North American platform will leverage the strong underwriting track record and profitability of the Canadian group in addition to the established infrastructure including an innovative online portal and e-bonding platform. Consistent with Trisura’s strategy, the U.S. surety platform will partner with a select agent and broker network and will offer custom solutions and experiences that are always “a step above.”

Chris Sekine, responsible for Trisura’s global surety platform and President and CEO of Trisura Guarantee Insurance Company, expressed his excitement about the new addition: “I’ve known George for 15 years,” said Chris. “His passion for the surety industry has allowed him to consistently deliver above-market results over his career. George knows the importance of building and strengthening relationships and is committed to providing agents and brokers with an exceptional experience. I’m eager to see our U.S. surety operation launch and grow under George’s leadership.”

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

TRISURA GROUP REPORTS THIRD QUARTER 2020 RESULTS

TORONTO, November 4, 2020 —

Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance provider, today announced financial results for the third quarter of 2020.

David Clare, President and CEO of Trisura, stated, “In the third quarter Trisura generated net income of $6.5 million – over 150% greater than Q3 2019 – driven by strong results in Canada, continued profitability in the U.S., and investment gains.

In Canada, disciplined underwriting and consistent investment returns generated an industry-leading 20% return on equity. Our U.S. business maintained its trajectory of growth, binding a new record of $171.0 million of quarterly gross premiums and generating $3.7 million in net income. Stronger asset liability matching in our Reinsurance operations also supported results.

Our balance sheet is well-funded to support growth, with flexibility afforded by our 9.5% debt-to-capital ratio.”

Highlights

  • Gross and net written premiums growth of 109.5% and 72.4% in Q3, supported by momentum in our U.S. operations and continued growth in Canada.
  • Net income of $6.5 million in the quarter grew 157.0% compared to prior year, driven by strong underwriting in Canada, continued profitability in the U.S and investment gains.
  • Consolidated LTM ROE of 11.7%, which includes dilution from the equity raises in September 2019 and May 2020, compared to 1.9% at Q3 2019.
  • Book value per share of $26.86, a 24.5% increase from December 31, 2019, driven by the equity raise in May and supported by positive net income.
  • EPS – diluted of $0.62 in Q3 2020 was impacted by share-based compensation as a result of rising share price but compared favourably to $0.37 in Q3 2019.
  • Premiums grew in our Canadian business by 58.9% in Q3 2020. Exceptional surety performance contributed to achieving a 91.5% combined ratio and a 20.0% LTM ROE.
  • Continued growth in our U.S. business, producing $171.0 million in GPW in the quarter and $3.7 million in net income, and reaching a 9.7% LTM ROE despite two significant capital injections.
  • Sufficient capital in our US operations supported an increase in A.M. Best size category from size VII to size VIII.
Amounts in C$ millions Q3 2020 Q3 2019 Variance Q3 2020 YTD Q3 2019 YTD Variance
Gross premiums written 239.6 114.4 109.5% 612.2     305.1 100.7%
Net premiums written 64.5 37.4 72.4% 152.9   103.0 48.5%
Net underwriting loss  (2.2)  (6.6) (67.3%)  (1.8)          (23.8) (92.6%)
Net investment income 7.0 10.0 (30.0%) 21.9            20.1 8.7%
Net income 6.5 2.5 157.0% 21.5              0.9 2,231.1%
EPS – diluted, $ 0.62 0.37 68.2% 2.22 0.13 1,607.7%
Book value per share, $ 26.86 21.41 25.5% 26.86 21.41 25.5%
Debt-to-Capital ratio 9.5% 13.6% (4.1pts) 9.5% 13.6% (4.1pts)
LTM ROE 11.7% 1.9% 9.8pts 11.7% 1.9% 9.8pts
Combined ratio – Canada 91.5% 92.6% (1.1pts) 84.6% 89.5% (4.9pts)
LTM ROE – Canada 20.0% 19.1% 0.9pts 20.0% 19.1% 0.9pts
Fronting operational ratio – US 73.4% 76.9% (3.5pts) 70.3% 88.7% (18.4pts)
LTM ROE – US 9.7% nm nm 9.7% nm nm

 

COVID-19

  • Trisura staff globally continue to work effectively from home. We have introduced safety measures in physical offices in preparation for a gradual return to work acknowledging best practices and local jurisdiction protocols.
  • Despite resilience in the quarter, fears of a second wave in the U.S. and weaker than anticipated economic recovery may threaten momentum.
  • Premium generation and claims activity may be impacted depending on the length and depth of the pandemic-related economic slowdown, as well as the effectiveness of government support programs. Depending on these factors, premium growth could slow and claims activity could increase.

Insurance Operations

  • Disciplined underwriting in Canada, achieving a loss ratio of 28.4% in the quarter, supported by strong claims experience in Surety, resulting in a combined ratio of 91.5%.
  • Strong growth in our U.S. platform, with GPW of $171.0 million in Q3 2020 compared to $144.8 million in Q2 2020, and fee income of $6.4 million in Q3 2020 compared to $5.6 million in Q2 2020.
  • A decrease in European interest rates negatively impacted consolidated net underwriting income in the quarter, offset by improved asset-liability matching.

Capital

  • The minimum capital test (“MCT”) ratio of our Canadian operations was 249% (258% as at December 31, 2019), which comfortably exceeded regulatory requirements of 150%.
  • Trisura Specialty’s capital of $115.5 million USD as at September 30, 2020 ($83.3 million USD as at December 31, 2019) was in excess of the various Company Action Levels of the states in which Trisura Specialty is licensed.
  • Consolidated debt-to-capital ratio of 9.5% as at September 30, 2020 is below our long-term target of 20.0%.

Investments

  • Investment income in Q3 2020 was $7.0 million compared to $10.0 million in Q3 2019. The decrease was the result of smaller decline in European interest rates in the quarter, which led to a smaller increase in the value of longer duration assets supporting our Reinsurance business liabilities. This was partially offset by an increase in interest and dividend income in North America.
  • In Canada and the U.S., interest and dividend income rose 38.3% in Q3 2020, versus the prior period in 2019, as we benefited from diversification of the U.S. portfolio after rebalancing through COVID-related volatility, and increased capital following the equity raises in September 2019 and May 2020.
  • Net gains were greater in Q3 2020 and Q3 2020 YTD as a result of favourable foreign exchange movements incurred in the quarter and greater realized gains.

Corporate Development

  • Trisura continues to grow its admitted licenses, with 42 state licenses today and the intention of securing admitted licenses in all 50 states.
  • In the quarter Trisura bound $1.8 million in admitted premiums; we expect the admitted business to be a significant opportunity for growth in 2021.
  • In November 2020, A.M. Best reaffirmed the financial strength rating of A- (Excellent) for both the Canadian and U.S. operations.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Trisura Group Ltd.
Consolidated Statements of Financial Position
As at September 30, 2020 and December 31, 2019
(in thousands of Canadian dollars, except as otherwise noted)

As at September 30, 2020 December 31, 2019
Cash and cash equivalents, and short-term securities  124,875  85,905
Investments  484,700  392,617
Premiums and accounts receivable, and other assets  154,581  86,669
Recoverable from reinsurers  567,361  293,068
Deferred acquisition costs  163,719  104,197
Capital assets and intangible assets  13,933  14,477
Deferred tax assets  8,347  1,460
Total assets  1,517,516  978,393
Accounts payable, accrued and other liabilities  48,924  40,916
Reinsurance premiums payable  144,691  80,186
Unearned premiums  510,200  328,091
Unearned reinsurance commissions  91,859  51,291
Unpaid claims and loss adjustment expenses  417,107  257,880
Loan payable  28,869  29,700
Total liabilities  1,241,650  788,064
Shareholders’ equity  275,866  190,329
Total liabilities and shareholders’ equity  1,517,516  978,393

Trisura Group Ltd.
Consolidated Statements of Comprehensive Income
For the three and nine months ended September 30
(in thousands of Canadian dollars, except as otherwise noted)

  Q3 2020 Q3 2019

Q3 2020

YTD

Q3 2019

YTD

Gross premiums written  239,607  114,354  612,242  305,050
Net premiums written  64,543  37,429  152,924  102,972
Net premiums earned  42,250  29,719  109,593  77,794
Fee income  6,652  2,530  20,060  8,631
Total underwriting revenue  48,902  32,249  129,653  86,425
Net claims and loss adjustment expenses  (19,319)  (18,092)  (49,466)  (49,249)
Net commissions  (15,060)  (10,265)  (38,431)  (27,839)
Operating expenses and premium taxes  (16,685)  (10,511)  (43,523)  (33,126)
Total claims and expenses (51,064) (38,868) (131,420) (110,214)
Net underwriting loss  (2,162)  (6,619)  (1,767)  (23,789)
Net investment income  7,015  10,027  21,857  20,111
Settlement from structured insurance assets  –  –  –  8,077
Net gains  4,178  476  5,628  1,664
Interest expense  (224)  (333)  (891)  (1,020)
Income before income taxes  8,807  3,551  24,827  5,043
Income tax expense  (2,272)  (1,008)  (3,334)  (4,121)
Net income  6,535  2,543  21,493  922
Other comprehensive (loss) income  (162)  1,048  (2,704)  1,996
Comprehensive income  6,373  3,591  18,789  2,918

Trisura Group Ltd.
Consolidated Statements of Cash Flows
For the three and nine months ended September 30
(in thousands of Canadian dollars, except as otherwise noted)

  Q3 2020 Q3 2019 Q3 2020 YTD Q3 2019 YTD
Net income from operating activities 6,535 2,543         21,493              922
Non-cash items to be deducted  (1,365)  (348)           6,006         (1,508)
Stock options granted 160  146               540              364
Change in working capital operating items 43,508 25,704         57,454         39,982
Realized gains on investments  (4,245)  (1,054)       (21,443)         (2,800)
Income taxes paid  (4,661)  (592)          (7,948)         (2,459)
Interest paid  (226)  (350)             (921)         (1,056)
Net cash from operating activities 39,706 26,049         55,181         33,445
Proceeds on disposal of investments 60,787 13,098       201,051         41,647
Purchases of investments  (72,855)  (27,832)     (281,781)       (91,076)
Net purchases of capital and intangible assets  (117)  (104)             (623)             (408)
Net cash used in investing activities  (12,185)  (14,838)       (81,353)       (49,837)
Dividends paid  (24)                    –               (72)
Shares issued 55,669         65,143         55,669
Loans received         32,700                    –
Repayment of loan payable       (32,700)                    –
Lease payments  (319)  (265)          (1,197)             (760)
Net cash (used in) from financing activities  (319) 55,380         63,946         54,837
Net increase in cash 27,202 66,591         37,774         38,445
Cash at beginning of the period 99,165 64,949         85,905         95,212
Currency translation  (1,492) 373           1,196         (1,744)
Cash at the end of the period 124,875 131,913 124,875 131,913

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Trisura Group, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”

 Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of Trisura Group to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

 Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada.

 We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP REPORTS SECOND QUARTER 2020 RESULTS

TORONTO, August 5, 2020 — Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance provider, today announced financial results for the second quarter of 2020.

David Clare, President and CEO of Trisura, stated, “In Q2, Trisura generated net income of $6.6 million, driven by operational strength from our specialty platforms in North America, investment gains and partially offset by reserve strengthening in our Reinsurance entity.

In Canada, disciplined underwriting and consistent investment returns sustained our industry-leading 19.7% return on equity despite the disruption of COVID-19. Our U.S. platform maintained its growth trajectory, binding $144.8 million of quarterly gross premiums and generating $4.0 million in net income. 

We experienced volatility in our reinsurance operations, the result of heightened market volatility and redeployment of our assets as the new manager established an improved portfolio.

Following our equity raise, our balance sheet is further strengthened and positioned to support growth.”

Highlights

  • Gross and net written premiums growth of 85.4% and 26.3% in Q2, supported by momentum in our U.S. operations and continued growth in Canada.
  • Net income of $6.6 million in the quarter, driven by strong underwriting in Canada, growing profitability in the U.S and investment gains.
  • Consolidated LTM ROE of 11.8%, which includes the impact of negative results in our reinsurance business and dilution from the equity raises in September 2019 and May 2020, compared to 3.3% at Q2 2019.
  • Book value per share of $26.24, a 21.6% increase from December 31, 2019, driven by the equity raise and supported by positive net income.
  • EPS of $0.68 in Q2 2020, compared to $(0.63) in Q2 2019.
  • Successfully completed a $65.1 million equity raise to sustain growth in the US supported by existing and new shareholders.
  • Industry-leading results from our Canadian business, achieving a combined ratio of 78.9% in Q2 2020, producing a 19.7% LTM ROE.
  • Continued acceleration in our U.S. business, producing $144.8 million in GPW in the quarter and $4.0 million in net income, driving a 9.5% LTM ROE.
  • Improved financial flexibility demonstrated by a debt-to-capital ratio of 9.9%, below our long-term target of 20.0%.

COVID-19

  • Trisura staff globally continue to work effectively from home. We have introduced safety measures in physical offices in preparation for a gradual return to work acknowledging best practices and local jurisdiction protocols.
  • Despite resilience in the quarter, fears of a second wave in the US and weaker than anticipated economic recovery may threaten momentum. We have observed slowing conditions across the US and continue to monitor closely.
  • Premium generation and claims activity may be impacted depending on the length and depth of the pandemic-related economic slowdown, as well as the effectiveness of government support programs. Depending on these factors, premium growth could slow and claims activity could increase.

Insurance Operations

  • Disciplined underwriting in Canada, achieving a loss ratio of 16.2% in the quarter, supported by strong claims experience across all lines. Improvements in expense ratio driven by operational efficiency resulted in a combined ratio of 78.9%.
  • Strong growth in our U.S. platform, with GPW of $144.8 million in Q2 2020 compared to $120.7 million in Q1 2020, and fee income of $5.6 million in Q2 2020 compared to $4.1 million in Q1 2020.
  • Volatility in the asset-liability matching in our international reinsurance operations negatively impacted consolidated net underwriting income in the quarter.

Capital

  • The minimum capital test (“MCT”) ratio of our Canadian operations was 255% (258% as at December 31, 2019), which comfortably exceeded regulatory requirements of 150%.
  • Trisura Specialty’s capital of $112.8 million USD as at June 30, 2020 ($83.3 million USD as at December 31, 2019) was in excess of the minimum requirement of the states in which Trisura Specialty is licensed.
  • Trisura International’s capital of $11.7 million USD as at June 30, 2020 ($14.2 million USD as at December 31, 2019) was appropriate in the context the regulatory capital requirements it is subject to.
  • Consolidated debt-to-capital ratio of 9.9% as at June 30, 2020 is below our long-term target of 20.0%.

Investments

  • In Q2 2020, net investment income of $6.3 million compared to $5.8 million in Q2 2019. The improvement was driven by an increase in interest and dividend income in North America, as well as longer duration reinsurance assets, which generated strong results in a declining interest rate environment.
  • In Canada, interest and dividend income was consistent in Q2 2020, versus the prior period.
  • In the U.S., interest and dividend income increased 80.6% in Q2 2020, over the prior period, as we benefited both from diversification of the portfolio and increased capital following equity raises in September 2019 and May 2020.
  • European rates fell in Q2 2020, which contributed to a net investment gain of $3.6 million in Trisura International, offset by reserve reductions. Investment income at Trisura International increased 72.7% over the prior YTD period.
  • Other comprehensive income was positively impacted by unrealized gains in the equity, preferred share and fixed income portfolios in both Canada and the US, following the recovery in financial markets since the end of Q1 2020.

Corporate Development

  • Trisura continues to grow its admitted licenses, with 30 state licenses today and the intention of securing admitted licenses in all 50 states.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Trisura Group Ltd.
Consolidated Statements of Financial Position
As at June 30, 2020 and December 31, 2019
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Comprehensive (Loss) Income
For the three months ended June 30
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Cash Flows
For the three months ended June 30
(in thousands of Canadian dollars, except as otherwise noted)

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Trisura Group, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”

 Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of Trisura Group to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

 Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada.

 We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP COMPLETES C$60 MILLION UPSIZED BOUGHT DEAL PUBLIC OFFERING AND CONCURRENT PRIVATE PLACEMENT OF C$7.5 MILLION

TORONTO, May 15, 2020 — Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance company, today announced that it has completed its previously announced upsized public offering of 1,289,150 common shares, including 168,150 common shares issued pursuant to the full exercise of the underwriters’ over-allotment option, at a price of $46.85 per common share, for gross proceeds of approximately $60 million (the “Offering”). The Offering was completed on a bought deal basis by a syndicate of underwriters led by BMO Capital Markets and Cormark Securities Inc.

Concurrent with the Offering, Trisura issued 160,100 common shares to its principal shareholder, Partners Value Investments Inc., on a private placement basis, for additional gross proceeds of approximately $7.5 million (the “Private Placement”).

In total, Trisura received gross proceeds of approximately $67.5 million from the closing of the Offering and the Private Placement.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

TRISURA GROUP LTD. ANNOUNCES INCREASE TO PREVIOUSLY ANNOUNCED BOUGHT DEAL PUBLIC OFFERING TO C$52.5 MILLION AND CONCURRENT PRIVATE PLACEMENT OF C$7.5 MILLION

TORONTO, May 11, 2020 — Trisura Group Ltd. (“Trisura”, or the “Company”) (TSX:TSU), a leading international specialty insurance company, announced today that, due to strong demand, the Company has increased the size of the previously announced bought deal public offering to 1,121,000 common shares (the “Common Shares”) of the Company, at a price of $46.85 per Common Share (the “Offering Price”) for gross proceeds of $52.5 million (the “Offering”). The Offering is led by BMO Capital Markets and Cormark Securities Inc. (collectively, the “Underwriters”). The Company has granted the Underwriters an option (the “Over-Allotment Option”), exercisable in whole or in part at any time up to 30 days following the closing of the Offering, to purchase up to an additional 15% of the Common Shares at the Offering Price to cover over-allotments, if any. Concurrently with the closing of the Offering, the Company will issue and sell 160,100 common shares of the Company in a private placement at the Offering Price, for additional gross proceeds of $7.5 million (the “Private Placement”), with Trisura’s principal shareholder, Partners Value Investments LP. Closing of the Offering and the Private Placement will be conditional on each other.

The Company intends to use the net proceeds of the Offering and the Private Placement for general corporate purposes including, but not limited to, supporting the growth of its U.S. fronting platform.

The Common Shares to be issued under the Offering will be offered by way of a prospectus supplement to be filed in each of the provinces and territories of Canada, and may be offered in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws, and certain other jurisdictions outside of Canada and the United States. 

Closing of the Offering and the Private Placement is expected to occur on or about May 15, 2020, subject to Trisura receiving all necessary regulatory approvals.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Cautionary Statement Regarding Forward-Looking Statements and Information

Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of the Company and its subsidiaries, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “likely,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could”.

Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of our Company to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: developments related to COVID-19, including the impact of COVID-19 on the economy and global financial markets; the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behaviour of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; changes in capital requirements; changes in reinsurance arrangements; ability to collect amounts owed; catastrophic events, such as earthquakes, hurricanes or pandemics; the possible impact of international conflicts and other developments including terrorist acts and cyberterrorism; and other risks and factors detailed from time to time in our documents filed with securities regulators in Canada.

We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group Ltd. undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP LTD. ANNOUNCES C$42.5 MILLION BOUGHT DEAL PUBLIC OFFERING AND CONCURRENT PRIVATE PLACEMENT OF C$7.5 MILLION

TORONTO, May 11, 2020 — Trisura Group Ltd. (“Trisura”, or the “Company”) (TSX:TSU), a leading international specialty insurance company, announced today that it has entered into an agreement with a syndicate of underwriters led by BMO Capital Markets and Cormark Securities Inc. (collectively, the “Underwriters”), pursuant to which the underwriters have agreed to buy, on bought deal public offering basis, 907,500 common shares (the “Common Shares”) of the Company, at a price of $46.85 per Common Share (the “Offering Price”) for gross proceeds of $42.5 million (the “Offering”). The Company has granted the Underwriters an option (the “Over-Allotment Option”), exercisable in whole or in part at any time up to 30 days following the closing of the Offering, to purchase up to an additional 15% of the Common Shares at the Offering Price to cover over-allotments, if any. Concurrently with the closing of the Offering, the Company will issue and sell 160,100 common shares of the Company in a private placement at the Offering Price, for additional gross proceeds of $7.5 million (the “Private Placement”), with Trisura’s principal shareholder, Partners Value Investments LP. Closing of the Offering and the Private Placement will be conditional on each other.

The Company intends to use the net proceeds of the Offering and the Private Placement for general corporate purposes including, but not limited to, supporting the growth of its U.S. fronting platform.

The Common Shares to be issued under the Offering will be offered by way of a prospectus supplement to be filed in each of the provinces and territories of Canada, and may be offered in the United States on a private placement basis pursuant to an exemption from the registration requirements of the United States Securities Act of 1933, as amended, and applicable state securities laws, and certain other jurisdictions outside of Canada and the United States.

Closing of the Offering and the Private Placement is expected to occur on or about May 15, 2020, subject to Trisura receiving all necessary regulatory approvals.

This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction. The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Trisura Group, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”

 Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of Trisura Group to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

 Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada.

 We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP REPORTS FIRST QUARTER 2020 RESULTS

TORONTO, May 6, 2020 — Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance provider, today announced financial results for the first quarter of 2020.

David Clare, President and CEO of Trisura, stated, “We are pleased with Trisura’s first quarter results, generating net income of $8.4 million, vs. $2.5 million in Q1 2019 driven by increasing  profitability from our US platform and continued strength in Canada.

Our US operations bound $120.7 million of gross premiums written and generated $2.6 million in net income. In Canada, disciplined underwriting and enhanced investment returns sustained our industry-leading 19.3% return on equity.

Importantly, improved asset-liability matching in our international reinsurance operations limited volatility in a challenging environment.

Notwithstanding our improved net income, book value per share decreased as a result of mark-to-market losses in the investment portfolio. However, our balance sheet remains healthy. Regulatory capital levels are strong despite market volatility while liquidity has been enhanced through an increase in available capacity from our revolving credit facility.”

Highlights

  • Gross and net written premiums growth of 108.8% and 46.1% in Q1, supported by continued momentum in our US operations and continued growth in Canada.
  • Net income of $8.4 million vs. $2.5 million in Q1 2019, driven by strong underwriting performance and investment income in Canada, and growing profitability in the US. We also recognized a gain related to the recognition of previously generated tax losses.
  • EPS of $0.94 in Q1 2020, compared to $0.37 in Q1 2019.
  • Book value per share of $21.23, a 1.6% decrease from $21.58 at December 31, 2019 as a result of unrealized losses in the investment portfolio.
  • Industry-leading results from our Canadian business, achieving a combined ratio of 82.0% in the current quarter vs. 83.5% in Q1 2019, and producing a 19.3% LTM ROE.
  • Continued acceleration in our US. operations, producing $120.7 million in GPW in the quarter vs. $41.9 million in Q1 2019; $2.6 million in net income, and a 9.3% LQA ROE demonstrate the potential of our maturing platform.
  • Increased our revolving credit facility capacity to $50.0 million, at consistent pricing, with the ability to draw proceeds in Canadian or US dollars.  Debt-to-capital ratio was 15.3% at March 31, 2020, below our long-term target of 20.0%.

COVID-19

  • Preliminary results for the month of April have demonstrated resilience, however Q2 2020 premium generation and claims activity may be impacted by the length and depth of the pandemic-related economic slowdown, as well as the effectiveness of government support programs. Depending on these factors, premium growth could slow and claims activity could increase.
  • The most direct financial impact observed during the quarter related to COVID-19 was the mark-to-market volatility in our investment portfolio.
  • In April, we did not observe a significant impact on underwriting results; our policies generally do not provide pandemic coverage and many surety bonds are focused on infrastructure projects deemed essential.
  • Trisura employees are working effectively from home.

Underwriting

  • Disciplined underwriting from our Canadian operations, achieving a loss ratio of 24.3% in the quarter, supported by strong underwriting across all lines. Improvements in expense ratio driven by operational efficiency resulted in a combined ratio of 82.0%
  • Accelerating growth in our US platform, with GPW of $120.7 million in Q1 2020 compared to $95.4 million in Q4 2019, and fee income of $4.1 million in Q1 2020 compared to $3.1 million in Q4 2019.
  • Improved asset-liability matching in our international reinsurance operations limited volatility in the quarter.

Capital

  • The minimum capital test (“MCT”) ratio of our Canadian operations was 233% (258% as at December 31, 2019), which comfortably exceeded regulatory requirements of 150%.
  • Trisura US’s capital of $81.3 million USD as at March 31, 2020 ($83.3 million USD as at December 31, 2019) was in excess of the minimum requirement of the Oklahoma Insurance Department.
  • Trisura International’s capital of $13.0 million USD as at March 31, 2020 ($14.2 million USD as at December 31, 2019) was greater than the FSC’s regulatory capital requirement.
  • Consolidated debt-to-capital ratio of 15.3% as at March 31, 2020 is below our long-term target of 20.0%.

Investments

  • In Q1 2020, net investment income of $8.5 million compared to $4.3 million in Q1 2019. The improvement was driven by an increase in interest and dividend income in North America, as well as longer duration reinsurance assets, which generated strong results in a declining interest rate environment.
  • In Canada, interest and dividend income increased 28.1% in Q1 2020, over Q1 2019, as we continued to benefit from an improved asset mix.
  • In the US, interest and dividend income increased 41.2% in Q1 2020, over Q1 2019, as we benefited both from diversification of the portfolio and increased capital following our equity raise in September 2019.
    European rates fell in Q1 2020, which resulted in net investment gain of $5.5 million in Trisura International, offset by reserve increases.
  • Other comprehensive (loss) income was negatively impacted by unrealized losses in the preferred share and equity portfolios in both Canada and the US, stemming from the sell-off related to the COVID-19 pandemic.
  • Foreign exchange differences, arising from the translation of financial statements of our US and International operations, provided a benefit in the quarter. We have initiated a hedging program to mitigate future currency-related volatility.

Corporate Development

  • Following the close of the acquisition of Trisura Insurance Company (formerly known as 21st Century Preferred Insurance Company) on November 1, 2019, Trisura continues to grow its capabilities with the intention of securing admitted licenses in all 50 states.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the US and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group. Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Trisura Group Ltd.
Consolidated Statements of Financial Position
As at March 31, 2020 and December 31, 2019
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Comprehensive (Loss) Income
For the three months ended March 31
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Cash Flows
For the three months ended March 31
(in thousands of Canadian dollars, except as otherwise noted)

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Trisura Group, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”

 Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of Trisura Group to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

 Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada.

 We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

TRISURA GROUP REPORTS FOURTH QUARTER AND 2019 ANNUAL RESULTS

TORONTO, February 12, 2020 — Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance provider, today announced financial results for the fourth quarter and year ended December 31, 2019.

David Clare, President and CEO of Trisura, stated, “We are pleased with Trisura’s fourth quarter results, generating net income of $4.2 million driven by strong performance from our specialty platforms in North America.

In Canada, substantial top-line growth, disciplined underwriting and enhanced investment returns sustained our industry leading return on equity. Our U.S. platform continued to build momentum, binding almost $100 million of quarterly gross premiums, and generating net income of $1.5 million to add to its first year of profitability.

Importantly, improved asset-liability matching in our international reinsurance operations limited volatility in Q4.”

Highlights

  • Gross and net premiums growth of 109.8% and 27.5% in Q4, and 104.7% and 23.5% for the full year supported by strong momentum in our U.S. business and continued growth in Canada.
  • Net income of $4.2 million in the quarter, and $5.1 million in 2019, driven by strong underwriting performance and investment income in Canada and a growing contribution from the U.S.
  • EPS of $0.47 in Q4 2019 and $0.69 in 2019, compared to $0.24 in Q4 2018 and 1.29 in 2018.
  • Book value per share of $21.58, a 9.9% increase over December 31, 2018.
  • Industry-leading results from our Canadian business, achieving a combined ratio of 9% in Q4 2019 and 87.8% in 2019, producing a 19.1% ROE for the year.
  • Continued acceleration in our U.S. business, producing $95.4 million in GPW in the quarter and $1.5 million in net income. For the year, GPW of $263.9 million drove fee income of $8.0 million and net income of $3.8 million representing our first year of profitability. This is an outstanding result considering the business commenced last year.
  • In February 2020, A.M. Best assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” to Trisura Insurance Company (“TIC”). The ratings of TIC also reflect an intercompany pooling agreement with its immediate parent, Trisura Specialty. TIC will commence writing admitted business in 2020 complementing Trisura Specialty’s non admitted business platform.

Underwriting

  • Disciplined underwriting from our Canadian operations, achieving NPE growth of 19.2% and a combined ratio of 82.9% in the quarter, 14.4% and 87.8% respectively for the full year 2019, supported by strong underwriting across all lines.
  • Accelerating growth in our U.S. platform, with GPW of $95.4 million in Q4 2019 compared to $71.2 million in Q3 2019. Annual GPW of $263.9 million increased from $53.7 million in 2018. Earned fee income in Q4 2019 of $3.1 million helped support annual earned fee income of $8.0 million, compared to $2.4 million in Q3 2019 and $0.9 million in 2018.
  • Weakening interest rates in Europe drove reserve strengthening in our reinsurance subsidiary in the first nine months of 2019; however, the impact to net income in Q4 2019 was muted following an improvement in the asset-liability matching.

Capital

  • The minimum capital test (“MCT”) ratio of our Canadian subsidiary was 258% (239% as at December 31, 2018), which comfortably exceeds regulatory requirements of 150%.
  • Trisura Specialty’s capital of $83.3 million USD as at December 31, 2019 ($48.8 million USD as at December 31, 2018) was in excess of the minimum requirement of the Oklahoma Insurance Department.
  • Trisura International’s capital of $14.2 million USD as at December 31, 2019 ($21.1 million USD as at December 31, 2018) was sufficient to meet the FSC’s regulatory capital requirement.
  • Consolidated debt-to-capital ratio of 13.5% as at December 31, 2019 is below our long- term target of 20%.
  • A.M. Best reaffirmed the Financial Strength Rating A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” of Trisura Guarantee and Trisura Specialty. The outlook of these Credit Ratings remains stable.

Investments

  • In 2019, net investment income of $16.2 million compared to $9.0 million in 2018, driven by an increase in duration of reinsurance assets, which generated strong results in a declining interest rate environment through the first nine months of 2019.
  • In Canada, interest and dividend income increased 8.9% in Q4 2019 and 42.8% for the full year, over the prior period, as we continued to benefit from an improved asset mix in the Canadian portfolio.
  • In the U.S., interest and dividend income increased 43.0% in Q4 2019 and 28.2% for the full year, over the prior period, as we benefited both from diversification of the portfolio and increased capital following our equity raise in September.
  • We continued to deploy capital into long-dated European government bonds, which has further improved our asset liability matching, as well as increasing our expected interest income. European rates rose in Q4 2019, which resulted in net investment loss of ($6.6) million in Trisura International, importantly offset by reserve reductions.

Corporate Development

  • Following the close of the acquisition of TIC (formerly known as 21st Century Preferred Insurance Company) on November 1, 2019, Trisura continues to grow its capabilities with the intention of securing admitted licenses in all 50 states.

About Trisura Group

Trisura Group Ltd. is an international specialty insurance provider operating in the surety, risk solutions, corporate insurance and reinsurance segments of the market. Trisura has three principal regulated subsidiaries: Trisura Guarantee Insurance Company in Canada, Trisura Specialty Insurance Company in the U.S. and Trisura International Insurance Ltd. in Barbados. Trisura Group is listed on the Toronto Stock Exchange under the symbol “TSU”.

Further information is available at http://www.trisura.com/group.Important information may be disseminated exclusively via the website; investors should consult the site to access this information. Details regarding the operations of Trisura Group are also set forth in regulatory filings. A copy of the filings may be obtained on Trisura Group’s SEDAR profile at www.sedar.com.

For more information, please contact:
Name: Bryan Sinclair
Tel: 416 607 2135
Email: bryan.sinclair@trisura.com

Trisura Group Ltd.
Consolidated Statements of Financial Position
As at December 31, 2019 and December 31, 2018
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Comprehensive Income
For the three and twelve months ended December 31
(in thousands of Canadian dollars, except as otherwise noted)

Trisura Group Ltd.
Consolidated Statements of Cash Flows
For the three and twelve months ended December 31
(in thousands of Canadian dollars, except as otherwise noted)

Cautionary Statement Regarding Forward-Looking Statements and Information  

Note: Note: This news release contains “forward-looking information” within the meaning of Canadian provincial securities laws and “forward-looking statements” within the meaning of applicable Canadian securities regulations. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, include statements regarding the operations, business, financial condition, expected financial results, performance, prospects, opportunities, priorities, targets, goals, ongoing objectives, strategies and outlook of Trisura Group, as well as the outlook for North American and international economies for the current fiscal year and subsequent periods, and include words such as “expects,” “anticipates,” “plans,” “believes,” “estimates,” “seeks,” “intends,” “targets,” “projects,” “forecasts” or negative versions thereof and other similar expressions, or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.”

 Although we believe that our anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, the reader should not place undue reliance on forward-looking statements and information because they involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, which may cause the actual results, performance or achievements of Trisura Group to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.

 Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to: the impact or unanticipated impact of general economic, political and market factors in the countries in which we do business; the behavior of financial markets, including fluctuations in interest and foreign exchange rates; global equity and capital markets and the availability of equity and debt financing and refinancing within these markets; strategic actions including dispositions; the ability to complete and effectively integrate acquisitions into existing operations and the ability to attain expected benefits; changes in accounting policies and methods used to report financial condition (including uncertainties associated with critical accounting assumptions and estimates); the ability to appropriately manage human capital; the effect of applying future accounting changes; business competition; operational and reputational risks; technological change; changes in government regulation and legislation within the countries in which we operate; governmental investigations; litigation; changes in tax laws; ability to collect amounts owed; catastrophic events, such as earthquakes and hurricanes; the possible impact of international conflicts and other developments including terrorist acts and cyber terrorism; and other risks and factors detailed from time to time in our documents filed with the securities regulators in Canada.

 We caution that the foregoing list of important factors that may affect future results is not exhaustive. When relying on our forward-looking statements, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Except as required by law, Trisura Group undertakes no obligation to publicly update or revise any forward-looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.

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