Q4 2023 Oxbridge Re Holdings Ltd Earnings Call
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Good afternoon, welcome to Oxbridge re its fourth quarter and year end 2023 earnings call. My name is symbolic and I will be your conference operator this afternoon.
At this time, all participants will be in a listen only mode. Joining us for today's presentation is Oxbridge Re's, Chairman, President and Chief Executive Officer, Jay Madhu, and Chief Financial Officer, and corporate Secretary ranging Timothy.
Following their remarks, we will open up the call for your questions I would like to remind everyone that this call is also being broadcast via webcast and available via webcast replay until April nine 2024 on the Investor information section of the Oxbridge re website at Www Dot Oxbridge re dot com now.
I would like to turn the call over to Randy and Timothy Chief Financial Officer of Oxbridge re who will provide the necessary cautions regarding the forward looking statements that will be made by management during this call.
Thank you operator.
During today's call there will be forward looking statements made regarding future events, including Oxbridge re's future financial performance. These forward looking statements are made pursuant to the private Securities Litigation Reform Act of 1095 words, such as anticipates estimates expects intends plans projects and other.
The similar words and expressions are intended to signify forward looking statements forward looking statements are not guarantees of future results and conditions, but rather are subject to various risks and uncertainties are detailed discussion of risks and uncertainties that could cause actual results and events to differ materially from such forward looking statements could include.
In the section entitled Risk factors.
Contained in our Form 10-K filed with the Securities and Exchange Commission today March $26 74.
Are any of these risks and uncertainties gonna have a material adverse effect on the company's business financial condition and the volatile CFO, what is which in turn can cause significant market price and volume from fusions full of securities any forward looking statements made on this conference call speak only as of the date of this conference call.
Except as required by law the company undertakes no obligation to update any forward looking statements contained on this call or in any company presentation, even if the company's expectations or any related events conditions or circumstances change no I'd like to turn the call over to a chairman President and Chief Executive Officer, Jay Madhu, Okay. Thank you.
Linda and welcome everyone. Thank you for joining US today, let me start by saying we are proud of the significant steps we have taken this year to fortify and diversify our business our core business remains reinsurance, where we write fully collateralized policies to cover property losses from specific catastrophes and because we write fully collateralized contracts. We believe we can compete.
Effectively with large carriers, we specialize in underwriting low frequency high severity risks, where we believe sufficient data exists to effectively analyze the risk return profile of reinsurance contracts. Our objective is to achieve long term growth and book value per share by writing business on a selective and opportunistic basis that will generate attractive underwriting.
Relative to risk.
Building on the stable reinsurance foundation, we began to diversify out there, especially in 2020 one as the lead sponsor of Oxbridge acquisition Corp, a special purpose acquisition company or spec focusing on investing in disruptive technologies.
In August of 2023, Oxford acquisitions successfully completed its business combination with AI, Inc. The company developed software northwest fractional aircraft ownership jet card area.
Brokerage and charter for its fleet of private aircrafts set those up operating partner. It operates in two segments software and aviation. Our software segment features our B to C charter GPT app and need to be.
Operator platform that charter GPT App uses natural language processing and machine learning to improve the private jet booking experience that jet.
Operator platform operates a suite of Standalone software products, such as we go out and dive a flight to enable FAA part 135 charter providers to add revenue maximizing efficiency and reducing environmental impact.
The aviation segment features jet aircraft rationalization jet cards, Ocreate charter management and buyers brokerage with a completion of the business combination in August of 2023, the company began trading on the NASDAQ stock exchange.
Interest in Jeopardy, I is recognized at fair value.
In other investments on our balance sheet and 2023, we expanded our business portfolio by established short Splashed, Inc. Our new subsidiary focused on web III technology sharp plus specializes in democratizing took a nice drilled wells assets or our W ways offering cocainize reinsurance securities as alternative invest.
But the opportunities these securities leverage blockchain technology to ensure complete transparency and compliance with the SEC guidelines, representing a significant advancement of the digital security market. Consequently, This initiative aims to broaden investor participation.
Spending opportunities beyond the select group of Ultra high net worth individuals.
Crucially establishment offshore plus was achieved without incurring new debt or do you think equity and our shareholders.
Reflecting our efficient approach of diversification.
We are enthusiastic about the prospects of these new investments and remain committed to keep our stakeholders informed of the progress in the forthcoming quarters.
Looking ahead, we intend to reposition oxbridge as a prominent player in the real world asset to our W. A wet three sector, but the details of the strategic direction will be shared later in the call.
In summary, we maintain a strong sense of Boston.
Optimism regarding the long term outlook of our core reinsurance business alongside the successful integration of our new ventures, just AI insurance plus as we embrace the RW market more comprehensively.
Now I'll turn things over to Randy I'll take us through our financial results. Thank you Jay I would like to remind you that our typical contract period is from June one to may 31st of the following year.
With respect to net premiums earned net premiums written for the year ended December 31st 2023 increased to 1 million to 155000 from 995000 in the prior year. The increase is due to higher rates on all of the reach of Suntrust's enforced during the quarter and year ended December 31st 2023, when compared with the prior periods.
Investment and other income rules until 'twenty three.
3000, primarily due to higher rates on all money market funds.
You can also see that we generated or incentive technology origination of management fee income.
In 2023 from <unk> plus subsidiary recorded an unrealized loss of eight point named it at all.
The result of a remeasurement of our investment in jet at fair value you have to recognize a 50000 positive change in the fair value of our equity securities as of December 31st thing twenty-three well up from the 350000 negative change in the prior year.
These factors taken together resulted in consolidated total revenues of negative $7 5 million.
Seven 5 million in 2023 compared to 850, it's all within the prior year.
Total expenses, including loss and loss adjustment expenses policy acquisition cost and general and admin expenses for the year ended December 31st 2023, with $2 3 million down from $2 6 million in 'twenty to 'twenty two.
Due to the triggering of limit losses to reinsurance contracts in September 'twenty, two others, though before I came here, which was partially offset by higher policy acquisition costs and increased general and admin expenses in 2023 other users of inflationary expense fluctuation and the recognition of.
Previously deferred offering costs in relation to eschew registration.
With a net loss of them make when they million or $1.69 per share in 2023 compared to a net loss of $1 8 million. Okay. Do you want them for XI in fiscal 2022, the decline in the quarter and year ended December 31st 2020 through its primarily due to the fair value changes in the company's equity investment in J E T.
That includes general expenses associated with the recognition of previously deferred offering costs on its history registration have you discussed before it went all in with the close we use various measures to analyze the growth and profitability of all business operations.
For our reinsurance business, we measure underwriting profitability by examining our loss ratio acquisition expense ratio and combined ratio.
Our loss ratio, which measures underwriting profitability is the ratio of losses and loss adjustment expense of them could significantly on the.
The loss ratio decreased to zero percent for the year ended December 31st 2023, compared to 107, 8% in the prior year wholly due to the limit losses suffered.
Two of our reinsurance contracts.
So the hurricane in September 2022.
Acquisition cost ratio, which measures operational efficiency compares policy acquisition costs.
Net premiums isn't it.
Oh, well acquisition of close ratios increased much another to 11, 2% for the year.
The city for 'twenty, and 'twenty, three compared with 11, 1% in the prior year.
Our expense ratio, which measures operating performance compares policy acquisition costs, and general and admin expenses with net premiums the expense ratio increased to 185, 1% for the year ended December 31st 2023 from 153, 1% for the prior year due to higher general and admin expenses in 2023, primarily from direct.
Cognition of previously deferred expenses associated with the company's form S. Three registration as well as marginal expenses associated with the successful launch of fourth short plus private placement offering or combined ratio, which is used to measure underwriting performance is the sum of the loss ratio and the expense ratio.
The combined ratio decreased to 185, 2% for the year ended December 31st 2023 from 269% for the prior year. The decrease is due to.
The decrease was due to a decrease in our loss ratio. During the year ended December 31st two and 'twenty three although it doesn't no underwriting losses suffered in 2023 like computer with underwriting losses suffered in 2022 are there any thoughts of Hurricane again noted until the balance sheet, our investment portfolio increased to 60000 at December 31st 2023.
From 642000 other prior year end due primarily to unrealized gains we experienced.
The improved global Cup to a market for the year, but investments decreased due to the negative change in the fair value of our equity investment in cash and cash equivalents unrestricted cash and cash equivalents decreased to $3 7 million at December 31st 2023, compared with $3 9 billion at December 31st 2022.
No I'd like to turn the call back over.
To wrap up before we take your questions Jim.
Thank you Brenda as highlighted earlier in todays discussion we have implemented decisive a substantial measures throughout this year to fortify and diversify our operations in December 2022 we establish on splash, our wholly owned subsidiary with the objective of Totalizing securities representing fracture licensed dress and reinsurance contracts underwritten by.
Our reinsurance subsidiary in the second quarter of 2023, we successfully concluded the initial offering with these tokens through our $2 4 million private placement. Furthermore, we are pleased to report that in Russia is about Delta category tokens are poised to achieve returns exceeding 45%, beating the initial 42% projected.
And despite the challenges posed by Hurricane Italia, which made landfall as a category three hurricane in 2023.
We believe these are the first token is reinsurance securities backed by a publicly traded company shorts pluses poised to democratize access to reinsurance as an alternative investment Avenue.
Leveraging the inherent advantages of blockchain technology to crop sophisticated digital securities.
Our tokens aimed to facilitate broader investor participation.
Ensuring our interests are securely and transparently recorded on the blockchain. These opportunities previously out of the reach of many investors due to extremely high barriers to entry are now accessible through our innovative approach essentially at while repeating myself, we have democratize access to reinsurance.
Subsequent to this in mid August 2023, our investment in a special purpose acquisition company Oxbridge acquisition Corp culminated in a business smarter AI a company specializing in fractional aircraft ownership jet card services aircraft brokerage at charter surfaces facilitated by it's praetor fleet are private aircraft.
Notably our own wholly owned subsidiary Oxbridge reinsurance limited assumed the role of lead investor in the spec sponsor concurrently with the Finalization of business merger. The company successfully listed its common shares and warrants on the NASDAQ These compelling opportunities not only augment our business, but also enhanced op risk.
While strategically positioning us to capitalize on the growth within our emerging technologies.
We are especially enthusiastic about the anticipated value of these investments fold and the benefits they offer to our shareholders.
As previously mentioned we are currently in the process of rebranding Oxbridge at <unk>, we have three focused company leveraging the significant progress. We have achieved this year forecast suggests an extraordinary expansion of the token is arguably a market over the next decade with with estimates exceeding 10 trillion. This growth trajectory is.
Fueled by escalating adoption of block that blockchain technology across very yes, traditional financial sectors, including Fiat currencies equities government bonds and real estate endorsements from institutions, such as Blackrock, Blackrock and bank of America.
The transformative potential of organization and enhancing financial infrastructure efficiencies, reducing cost and optimizing supply chains more.
Rover industry analysis from firms such as Boston Consulting group anticipate a substantial surge in the asset market potentially reaching 16 trivia.
As pioneers in this evolving landscape, we hold a strong sense of optimism regarding the value our rebranding efforts will unlock for our shareholders. We remain steadfast in our commitment to seizing the opportunities presented by this dynamic market with that we are now ready to address any questions. You may have operator, please provide the APA.
Procreate instructions.
Thank you Sir.
At this time, we will be conducting a question and answer session.
If you would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue you.
You May press Star two if you would like to remove your question from the queue for participants using speaker equipment. It may be necessary to pick up your handset before pressing star one.
One moment, please while we poll for questions.
And as a reminder, if anyone has any questions you May press star one on your telephone keypad in order to join the question and answer queue.
And at this time. This concludes our question and answer session I would now like to turn the call back over.
Mr Naidu for his closing remarks.
And Mr. Madhu.
Thank you for joining us for today's call before we conclude I would like to extend my gratitude to our employees business partners and investors for their unwavering support.
<unk> you want to acknowledge our dedicated Oxbridge team, who has extensive experience has been instrumental in navigating and advancing our business amidst these challenging circumstances, we anticipate providing you with further updates of our progress during our next call.
Have any additional questions. Please do not hesitate to reach out to us at any time. Once again. Thank you for your time attention today and for your ongoing interest in box rich operator.
Before we conclude today's call I would like to remind everyone that a recording of today's call will be available for replay.
Available in the investors section of the company's website. Thank.
Thank you for joining us today for our presentation you may now disconnect.
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