Q2 2024 SiriusPoint Ltd Earnings Call
Operator: With that, I would like to turn the call over to Sarah Singh, Vice President, Strategy and Investor Relations. Please go ahead.
Sarah Singh: With that, I would like to turn the call over to Sarah Singh, Vice President, Strategy and Investor Relations.
With that I would like to turn the call over to Sarah thing widespread iden strategy and Investor Relations. Please go ahead.
Unknown Executive: Please go ahead.
Yeah.
Sarah Singh: Thank you, operator. And good morning and good afternoon to everyone listening.
Sarah: Thank you operator, good morning, good afternoon to everyone listening well.
Speaker Change: Welcome you to the serious point earnings call for the 'twenty 'twenty four half year and second quarter results.
Sarah Singh: I welcome you to the SiriusPoint earnings call for the 2024 half-year and second quarter results. Last night, we issued our earnings press release and financial supplement, which are available on our website www.siriuspt.com. Additionally, a webcast presentation will coincide with today's discussion and is available on our website. With me here today are Scott Egan, our Chief Executive Officer, and Jim McKinney, our Chief Financial Officer. Before we start, I would like to remind you that today's remarks contain forward-looking statements based on management's current expectations. However, actual results may differ.
Speaker Change: Last night, we issued our earnings press release, and financial supplement which are available on our website www dot serious T T dot com.
Speaker Change: Additionally, a webcast presentation Balkan coincide with today's discussion.
Speaker Change: Payable on our website.
With me here today are Scott <unk>, our Chief Executive Officer, and Jim Mckinney, Our Chief Financial Officer.
Unknown Executive: I would like to remind you that today's remarks contain forward-looking statements based on management's current expectations. Actual results may differ. Certain non-GAAP financial measures will also be discussed. Management uses the non-GAAP financial measures in its internal analysis of results and believes that it may be informative to investors, engaging the quality of our financial performance and identifying trends in our results. However, these measures should not be considered as a substitute for or superior to the measures the financial performance prepared in accordance with GAAP.
Speaker Change: Before we start I would like to remind you that today's remarks contain forward looking statements based on management's current expectations.
Actual results may differ.
Sarah Singh: Certain non-GAAP financial measures will also be discussed. Management uses these non-GAAP financial measures in its internal analysis of results and believes that they may be informative to investors, highlighting the quality of our financial performance and identifying trends in our results. However, these measures should not be considered as a substitute for or superior to the measures of financial performance prepared in accordance with GAAP. Please refer to page two of our investor presentation for additional details and the company's latest public filings. At this time, I will turn the call over to Scott.
Speaker Change: Certain non-GAAP financial measures will also be discussed.
Speaker Change: Management uses the non-GAAP financial measure in its internal analysis of results and believes that they may be informative to investors engaging the quality of our financial performance and identifying trends in our results.
Speaker Change: However, these measures should not be considered as a substitute for or superior to measures of financial performance prepared in accordance with GAAP.
Unknown Executive: Please refer to page two of our investor presentation for additional details and the company's latest public violence.
Speaker Change: Please refer to page two of our investor presentation for additional detail in the company's latest filings at this time I will turn the call over to Scott.
Scott Egan: At this time, I will turn the call over to Scott. Thanks, Sarah, and good morning. Good afternoon, everyone. Thanks for joining our second quarter and half year 2024 results call. I'm really pleased to report another strong set of results in the second quarter. We continue to build a track record of improving and consistent earnings. We believe that our strong focus on underwriting performance and relentless execution is showing through. This is now our seventh consecutive quarter of underwriting profit. We are building important proof points of the progress that we're making. Starting with premium, we've seen excellent premium growth in our continuing lines while retaining our underwriting discipline.
Scott Egan: Thanks, Sarah, and good morning, good afternoon, everyone. Thanks for joining our second quarter and half year 2024 results call. I'm really pleased to report another strong set of results in the second quarter. We continue to build a track record of improving and consistent earnings. We believe that our strong focus on underwriting performance and relentless execution is showing through. This is now our seventh consecutive quarter of underwriting profit.
Scott: Hi, Good morning, good afternoon, everyone. Thanks for joining our second quarter and half year 2024 results call.
I'm really pleased to report another strong set of results in the second quarter.
Scott: We continue to build the track record of improving and consistent earnings.
Speaker Change: We believe that our strong focus on underwriting performance and relentless execution is showing through.
Speaker Change: This is our seventh consecutive quarter of underwriting profit.
Scott Egan: We are building important proof points of the progress that we're making. Starting with premium, we've seen excellent premium growth in our continuing lines whilst retaining our underwriting discipline. Our Q2 discrete core premium growth, excluding the lines exited in 2023, was up 22%, while half-year growth is up 6% year-on-year. Given our restructuring in 22 and 23 to improve underwriting performance, it is important to look at the underlying performance. Our simplified One SiriusPoint operating structure and culture means we are able to work in a cohesive and agile way, enabling us to allocate capital quickly and to tap into market opportunities where they are most attractive. Insurance and services gross premium written, adjusted for the exited programs, grew 16% year over year, driven by our North American programs, international, and London business.
Speaker Change: We are building important proof points of the progress that we're making.
Speaker Change: Yeah.
Speaker Change: Starting with premium we've seen excellent premium growth in our continuing lines, whilst retaining our underwriting discipline.
Scott Egan: Our quarter to discrete core premium growth, excluding the lines exited in 2023, was up 22%. While half year growth is up 6% year on year. Given our restructuring in 22 and 23 to improve underwriting performance, it is important to look at the underlying performance. Our simplified one-city-est point operating structure and culture means we are able to work in a cohesive and agile way, enabling us to allocate capital quickly and to tap into market opportunities where they are most attractive. Insurance and services growth premium written adjusted for the exited programs grew 16% year over year, driven by our North American programs, international, and London business.
Speaker Change: Quarter, two discrete called premium growth, excluding the lines exited in 2023 was up 22%.
Speaker Change: Well half your growth is up 6% year on year.
Speaker Change: Given our restructuring in 'twenty, two 'twenty three to improve underwriting performance.
Speaker Change: It's important to look at the underlying performance.
Speaker Change: A simplified one city is point operating structure and culture means we are able to walk in a cohesive and agile way, enabling us to allocate capital quickly tap into market opportunities, where they are most attractive.
Speaker Change: Insurance and services gross premium written adjusted for the exited programs grew 16% year over year, driven by our North American programs International and London business.
Scott Egan: We're pleased with this progress, given these are important areas of strategic focus. This growth is coupled with a strong half year combined ratio of 92.5% for our core business, demonstrating our focusing discipline on driving profitable growth. During the first half year, we've added seven new programmes and expanded three partnerships. This positive momentum has continued into the start of the second half of the year with four new partnerships already announced during July. Our MGA Centre of Excellence is beginning to earn a market reputation as an attractive and leading platform for programme administrators and managing general agents.
Scott Egan: We're pleased with this progress given these are important areas of strategic focus. This growth is coupled with a strong half-year combined ratio of 92.5% for our core business, demonstrating our focus and discipline on driving profitable growth. During the first half of the year, we added seven new programs and expanded three partnerships.
Speaker Change: We're pleased with this progress given these are important areas of strategic focus.
Speaker Change: This growth is coupled with a strong half year combined ratio of 92, 5% for our core business, demonstrating our focus and discipline on driving profitable growth.
Speaker Change: Yeah.
Speaker Change: During the first half here, we've added seven new programs and expanded three partnerships. This positive momentum has continued into the start of the second half of the year with four new partnerships already announced during July.
Scott Egan: This positive momentum has continued into the start of the second half of the year, with four new partnerships already announced during July. Furthermore, our MGA Centre of Excellence is beginning to earn a market reputation as an attractive and leading platform for program administrators and managing general agents. I'm excited about the momentum building in this part of the business. Since the quarter end, some loss events have affected the industry, most notably Crowdstrike and Hurricane Beryl. We do not expect these events to have a significant impact on Siriuspoint.
Oh, the MGA sensitive excellence is beginning to and market reputation as an attractive and leading platform for program administrators and managing general agents I am excited about the maintenance building in this part of the business.
Scott Egan: I'm excited about the momentum building in this part of the business. Since the quark are in some lots of events have affected the industry, most notably CrowdStrike and Hurricane Battle. We did not expect these events to have a significant impact on SiriusPoint. Turning now to our MGAs, we've taken multiple actions in relation to our MGA equity stakes to unlock value and simplify our balance sheet. The deconsolidation over Cadian has allowed us to recognise the value of our share in this business at a market value without impacting our go-forward P&L. I've stated before that the actual economic value over consolidated MGAs is significantly higher than the carrying value of these assets.
Speaker Change: Since the call today, and some loss events have affected the industry, most notably type strike and how they can better with.
Speaker Change: We did not expect these events to have a significant impact on city point.
Speaker Change: Yeah.
Scott Egan: Turning now to our MGAs, we've taken multiple actions in relation to our MGA equity stakes to unlock value and simplify our balance sheet. The deconsolidation of Arcadian has allowed us to recognize the value of our share in this business at a market price without impacting our go-forward P&L. I've stated before that the actual economic value of our consolidated MGAs is significantly higher than the carrying value of these assets, and they are not fully reflected in Siriuspoint's share price, and that KD&D consolidation is an important proof point.
Speaker Change: Coming now to at MGH, we've taken multiple actions in relation to an MGA equity stakes to unlock value and simplify our balance sheet.
Speaker Change: The deconsolidation of our KPN has allowed us to recognize the value of a sheet in this business at a market value without impacting our go forward P&L.
Speaker Change: I've stated before that the true economic value of our consolidated M. G as a significantly higher than the accounting value of these assets they.
Scott Egan: They are not fully reflected in SiriusPoint share price, and our Cadian deconsolidation is an important proof point. While it is a first step in this regard, a significant value gap still remains for our remaining consolidated MGAs. A remaining three consolidated MGAs have a boot value of $94 million and generated $24 million of net service income for the first half in 2024. Our MGA equity stakes are now down to 22 compared to 36 at the start of 2023. In Q2, our MGA strategic actions resulted in a 46 million pre-tax gain being recognised. With regard to investment, we've reported another excellent investment result for the second quarter.
Speaker Change: They are not fully reflected in cities point share price.
Speaker Change: And Acadian deconsolidation is an important proof point.
Scott Egan: While it is a first step in this regard, a significant value gap still remains for our remaining consolidated MGAs. Our remaining three consolidated MGAs have a boot value of $94 million and generated $24 million of net service fee income for the first half of 2024. Our MGA equity stakes are now down to 22 compared to 36 at the start of 2023.
Speaker Change: Well it is the first step in this regard a significant value gap still remains for our remaining consolidated M. G H.
Speaker Change: Our remaining three consolidated AMG as a book value of $94 million and generated $24 million of net service fee income for the first half in 2024.
Speaker Change: Our LNG equity Stakes, another 10% to 22 compared to 36 at the start of 2023.
Scott Egan: In Q2, our MGA strategic actions resulted in a 46 million pre-tax gain being recognized. With regard to investment, we've reported another excellent investment result for the second quarter. This outcome reflects the continuing strong rate performance and our ongoing optimization of the portfolio. As a result, we are pleased to increase our net investment income guidance for the full year 2024 to between $275 and $285 million, up from $250 to $265 million. The combination of our strong underwriting performance, MGA Net Service Fee Income, and investment results contributed to a net income of $110 million in the second quarter and $201 million for the half year. And at the half year, we are operating within a recently upgraded return on equity range of 12 to 15%. Diluted book value per share grew 5% in the quarter and 7% year-to-date.
Speaker Change: In Q2, our MGA strategic actions resulted in a 46 million pretax gain being recognized.
Speaker Change: With regards to investment we've reported another excellent investment result for the second quarter.
Scott Egan: This outcome reflects the continuing strong rate performance and our ongoing optimisation of the portfolio. As a result, we are pleased to increase our net investment income guidance for the full year 2024 to between $275 and $285 million, up from $250 to $265 million. The combination of our strong underwriting performance, MGA net service fee income, and investment results contributed to a net income of $110 million in the second quarter and $201 million for the half year. At the half year, we are operating within a recently upgraded return and equity range of 12 to 15 per cent.
Speaker Change: Outcome reflects the continuing strong rate performance on our ongoing optimization of the portfolio.
Speaker Change: As a result, we are pleased to increase our net investment income guidance for the full year 2024 to between 275 and $285 million up from $250 million to $265 million.
Speaker Change: The combination of our strong underwriting performance MGA net service fee income and investment results contributed to a net income of $110 million in the second quarter on $201 million for the half year.
Speaker Change: I got the half year, we are operating within our recently upgraded return on equity range of 12% to 15%.
Scott Egan: Deleting boot value for shared grew 5 percent in the quarter and 7 percent year to date.
Speaker Change: Diluted book value per share grew 5% in the quarter and 7% year to date.
Scott Egan: Turning now to our people, they are firmly at the heart of our serious point business. We have an annual employee engagement survey, the voice of Serious Point, which we run again at the end of quarter two. We were absolutely delighted to see a significant step up in overall engagement levels, building on higher levels recorded in the 2023 survey. Overall, employee engagement moved up from 75% to 80%, with all seven categories of engagement going up, including a 9% jump in employee pride in the business. Our net promoter score also increased by 37 points this year. Our response rate of 93%, which was up 13% on last year, indicates that people have faith that we will act on the back of the results, and we will.
Scott Egan: Turning now to our people, they are firmly at the heart of our Siriuspoint business. We have an annual employee engagement survey, the Voice of Siriuspoint, which we ran again at the end of quarter two. We were absolutely delighted to see a significant step up in overall engagement levels, building on high levels recorded in the 2023 survey. Overall employee engagement moved up from 75% to 80%, with all seven categories of engagement going up, including a 9% jump in employee pride in the business.
Speaker Change: Turning now to our people they are firmly at the heart, Although city is point business.
Speaker Change: We have an annual employee engagement survey the voice of Citi is point, which we run again at the end of quarter two.
Speaker Change: We were absolutely delighted to see a significant step up in overall engagement levels building on high levels recorded in the 2023 sorry.
Speaker Change: Overall employee engagement moved up from 75% to 80% with all seven categories of engagement going up including a 9% jump in employee pride in the business.
Scott Egan: Our net promoter score also increased by 37 points this year. Our response rate of 93%, which was up 13% on last year, indicates that people have faith that we will act on the back of the results, and we will. Employee engagement is a big lever of organizational success, and we don't just give it lip service; we live it and breathe it. I am very proud of our people.
Speaker Change: Our net promoter score also increased by 37 points this year.
Speaker Change: A response rate of 93%, which was up 15% on last year in the case that people have faith that we will act on the back of the results and we will.
Scott Egan: Employee engagement is a big lever of organisational success, and we don't just give it lip service; we live it and breathe it. I am very proud of our people. My special thanks go out to all of them for their unwavering drive and collaboration in improving our business in every regard.
Speaker Change: Employee engagement is a big lever of organizational success.
Speaker Change: And we don't just give lip service, we live and breathe it.
Speaker Change: I am very proud of our people.
Scott Egan: My special thanks go out to all of them for their unwavering drive and collaboration in improving our business in every regard. Finally, our Q2 Bermuda Solvency Capital Ratio of 284% is the strongest it has ever been. On the back of our strong results in our capital position, we are announcing three further capital actions. Firstly, we have agreed with CMIG to repurchase approximately 9.1 million shares for $125 million. Secondly, we have also agreed with CMIG a full and final settlement for the Series A preference shares in cash. Thirdly, the board has authorised repurchase authorizations of approximately $300 million.
Speaker Change: My special Thanks go out to all of them for their unwavering drive in collaboration and improving our business in every regard.
Scott Egan: Finally, our Q2 commuter solvency capital ratio of 284% is the strongest it has ever been. On the back of our strong results in capital position, we are announcing three further capital actions. Firstly, we have agreed with CMIG to repurchase approximately 9.1 million shares for $125 million. Secondly, we have also agreed with CMIG a full and final settlement for the Series A preference shares in cash. Thirdly, the board has authorised repurchase authorisations of approximately $300 million. These three actions demonstrate that we now have flexibility to use our balance sheet to further improve and simplify the company while continuing to be prudent custodians of capital.
Speaker Change: Finally, our Q2, Bermuda solvency capital ratio of 284% is the strongest it has ever been.
Speaker Change: On the back of our strong results and capital position, we have done anything three further capital actions.
Speaker Change: Firstly, we have agreed with <unk> to repurchase approximately nine 1 million shares for $125 million.
Speaker Change: Secondly, we have also agreed with CMI G. A full and final settlement for the Cds a preference shares in cash.
Speaker Change: Thirdly, the board has authorized repurchase authorization of approximately $300 million.
Scott Egan: These three actions demonstrate that we now have the flexibility to use our balance sheet to further improve and simplify the company while continuing to be prudent custodians of capital. In summary, our half-year performance is strong, with significant delivery against our strategic and operational objectives. Our execution intensity remains focused and high. Our headline return on equity of 16.7% for the half year demonstrates this. Our underlying return on equity is trending within a recently updated guidance of 12-15%.
Speaker Change: These three actions demonstrate that we know have flexibility to use our balance sheet to further improve and simplify the company, while continuing to be prudent custodians of capital.
Scott Egan: In summary, our half-year performance is strong, with significant delivery against our strategic and operational objectives. Our execution intensity remains focused and high. Our headline return on equity of 16.7% for the half-year demonstrates this. Our underlying return on equity is trending within a recently updated guidance of 12 to 15%. I am grateful to all of stakeholders for their continued support as we drive series-point performance towards our ambitions of best-in-class.
Speaker Change: And if somebody our half year performance is strong with significant delivery against our strategic and operational objectives.
Speaker Change: Our execution intensity remains focused on high.
Speaker Change: Our headline return on equity of 16, 7% for the half year demonstrates this.
Speaker Change: Our underlying return on equity is trending within our recently updated guidance of 12% to 15%.
Scott Egan: I am grateful to all our stakeholders for their continued support as we drive Siriuspoint performance towards our ambitions of best in class. Before we move across to the financials, I want to extend a welcome to our new CFO, Jim McKinney, to Siriuspoint. Jim joined us during Q2. He has a track record of creating high-performance finance functions throughout his 20-plus year career, as well as deep and broad experience as a publicly listed CFO. I look forward to having Jim on board for his support and experience as we go on the next stage of our journey. With these remarks, I'll pass them along to Jim. Thank you.
Speaker Change: I am grateful to all of our stakeholders for their continued support as we drive cities point performance towards had ambitions of best in class.
Scott Egan: Before we move across to this financials, I want to extend a welcome to our new CFO, Jim McKinney, to Series Point. Jim joined us during Q2. He has a track record for creating high-performing finance functions throughout his 20-plus year career, as well as deep and broad experience as a publicly listed CFO. I look forward to having Jim on board for his support and experience as we go on the next stage of our journey.
Speaker Change: Before we move across to the financials I want to extend a welcome to a new CFO, Jim Mckinney to city point.
Speaker Change: Jim joined Us during Q2.
Speaker Change: He has a track record for creating high performing finance functions throughout his 20, plus year career as well as deep and broad experience as a publicly listed CFO.
Speaker Change: I look forward to having Jim on board for his support and experience as we go on the next stage of our journey with visa marks I'll pass across to Jim.
Scott Egan: With these remarks, I'll pass that across to Jim.
Jim Mckinney: Thank you, Scott. And good morning, and good afternoon to everyone.
Jim Mckinney: Thank you, Scott. Good morning, good afternoon, to everyone.
Jim: Thank you Scott and good morning, good afternoon to everyone I would like to start by saying how exciting it is to be joining serious point at this stage of the journey I've been impressed by the depth of talent that we already have within the business and I look forward to working with the team to create shareholder value and drive forward the change required to realize our ambition.
Jim Mckinney: I would like to start by saying how exciting it is to be joining Series Point at this stage of the journey. I've been impressed by the death of talent that we already have within the business, and I look forward to working with the team to create shareholder value and drive forward the change required to realize our ambition of becoming a best-in-class. Starting on slide 10, we highlight our second quarter results. It was another great quarter with a combined ratio of 93.3% for the core business, gross written premium growth of 22% for continuing lines that is adjusted for the business exited in 2023, and net income of 110 million.
Jim Mckinney: I would like to start by saying how exciting it is to be joining SiriusPoint at this stage of the journey. I've been impressed by the depth of talent that we already have within the business, and I look forward to working with the team to create shareholder value and drive forward the change required to realize our ambition of becoming a best-in-class insurer. Starting on slide 10.
Jim: Becoming a best in class insurer.
Jim Mckinney: We will highlight our second quarter results. It was another great quarter with a combined ratio of 93.3% for the core business, gross written premium growth of 22% for continuing lines that is adjusted for the business exited in 2023, and net income of $110 million. The net income reflects an increase of $54 million versus the prior year quarter, with the overall impact of the MGA actions we took in the quarter contributing $46 million to net income.
Speaker Change: Starting on slide 10.
Speaker Change: We highlight our second quarter results. It was another great quarter with a combined ratio of 93, 3% for the core business gross written premium growth of 22% for continuing lines that is adjusted for the business exited in 2023 and net income of $110 million.
Jim Mckinney: The net income reflects an increase of 54 million versus the prior year quarter, with the overall impact of the MGA actions we took in the quarter contributing 46 million to net income. Deluded book value per share grew 5% in the quarter. Focusing on underwriting, gross premium written increased 5% on the quarter for the core business. Our headline combined ratio of 93.3% for the core business was a 2.4 point deterioration versus prior year on a light-for-light basis excluding the loss portfolio transfer. This was due to lower favorable prior year development, which stood at 4 million versus 15 million in the prior year quarter, excluding the LBT, and 6 million of catastrophe losses versus not in the prior year quarter.
Speaker Change: And net income reflects an increase of $54 million versus the prior year quarter with the overall impact of the MGA actions, we took in the quarter contributing 46 million to net income.
Speaker Change: Book value per share grew 5% in the quarter.
Jim Mckinney: Diluted book value per share grew 5% in the quarter, focusing on underwriting; gross premium written increased 5% in the quarter for the core business. Our headline combined ratio of 93.3% for the core business was a 2.4 point deterioration versus the prior year on a life for life basis excluding the lost portfolio transfer. This was due to lower favorable prior year development, which stood at 4 million versus 15 million in the prior year quarter excluding the LPT and 6 million of catastrophe losses versus none in the prior year quarter. Prior year development will vary over quarters.
Speaker Change: Focusing on underwriting gross premium written increased 5% on the quarter for the core business. Our headline combined ratio of 93, 3% for the core business was a two four point deterioration versus prior year on a like for like basis, excluding the loss portfolio transfer.
Speaker Change: This was due to lower favorable prior year development, which stood at $4 million versus $15 million in the prior year quarter, Excluding E. L. P T and 6 million of catastrophe losses versus none in the prior year quarter.
Jim Mckinney: Prior year development will vary over quarters. This marked the 13th quarter of favorable prior year development on a consolidated basis that includes our runoff business, demonstrating our prudent approach to preserving. Importantly, the attritional loss ratio for the core business improved by 4.6 points versus the prior year quarter. This was partially offset by an increase in acquisition costs of 3.7 points due to loss-sensitive features and a change in the business mix. Looking at the trend in the underlying accident year ratio excluding cats, we have improved earning quality by 0.4 points compared to the prior year period.
Speaker Change: Prior year development will vary over quarters. This marked the 13th quarter of favorable prior year development on a consolidated basis that includes our runoff business demonstrating our prudent approach to reserving.
Jim Mckinney: This marked the 13th quarter of favorable prior-year development on a consolidated basis that includes our runoff business, demonstrating our prudent approach to preservation. Additionally, the attritional loss ratio for the core business improved by 4.6 points versus the prior year quarter. This was partially offset by an increase in acquisition costs of 3.7 points due to loss sensitive features and a change in the business mix. Looking at the trend in the underlying accident year ratio, excluding caps, we have improved earnings quality by 0.4 points compared to the prior year period. Core MGA revenue was reduced by $2 million versus the prior year to $57 million.
Speaker Change: Importantly, the Attritional loss ratio for the core business improved by four six points versus the prior year quarter. This was partially offset by an increase in acquisition cost of $3 seven points due to loss sensitive features and a change in the business mix.
Speaker Change: Looking at the trend in the underlying accident year ratio, excluding cats, we have improved earnings quality by 0.4 points compared to the prior year period.
Jim Mckinney: Core MGA revenue reduced by 2 million versus prior year to 57 million. Despite this, margins improved by 1.1 points to a strong 17%, resulting in our MGA net service fee income increasing to 10 million for the quarter. Net investment income for the quarter was strong at 78 million. This is up by 10 million compared to the prior year quarter, as the de-risk portfolio continues to benefit from rate increases. Unrealized and realized gains, including from related party investment funds, were 55 million. This includes losses relating to the MGA actions we took during the quarter. The total investment result for the quarter stood at 23 million.
Speaker Change: Core MGA revenue reduced by $2 million versus prior year to $57 million. Despite.
Jim Mckinney: Despite this, margins improved by 1.1 points to a strong 17%, resulting in our MGA net service fee income increasing to $10 million for the quarter. Net investment income for the quarter was strong at $78 million, up by $10 million compared to the prior year quarter as the de-risk portfolio continues to benefit from rate increases. Unrealized and realized gains, including from related party investment funds, were $55 million.
Speaker Change: Despite this margins improved by 1.1 points to a strong 17%, resulting in our MGA net service fee income increasing to $10 million for the quarter.
Speaker Change: Net investment income for the quarter was strong at 78 million. This is up by $10 million compared to the prior year quarter as the Derisk portfolio continues to benefit from rate increases unrealized and realized gains including from related party investment funds were $55 million.
Jim Mckinney: This includes losses relating to the MGA actions we took during the quarter. The total investment result for the quarter stood at $23 million. Other items impacting income included $4 million of foreign exchange losses and an $11 million impact from mark to market on liability-classified capital instruments.
Speaker Change: This includes losses relating to the MGA actions, we took during the quarter. The total investment results for the quarter stood at $23 million. Other items impacting income included $4 million of foreign exchange losses, and an $11 million impact from mark to market on liability classified capital instruments common shareholders' equity grew 4%.
Jim Mckinney: Other items impacting income included 4 million of foreign exchange losses and an 11 million impact from market to market on liability classified capital instruments. Common shareholders' equity grew 4% during the quarter, supported by the strong earnings and the net gains from the MGA actions. Adjusting for AOCI, common shareholders' equity grew by 5%.
Jim Mckinney: Common shareholders' equity grew 4% during the quarter, supported by strong earnings and the net gains from the MGA actions. Adjusting for AOCI, common shareholders' equity grew by 5%. Now looking at our half-year performance on slide 11. We are very pleased to report a combined ratio of 92.5% for the core business, net income of $201 million, and diluted book value per share growth of 7%. Adjusting for the net effect of the MGA actions and the impact of the lost portfolio transfer last year, net income increased 72% year-on-year, demonstrating the improving quality of our underlying earnings.
Speaker Change: The quarter supported by strong earnings and the net gains from the MGA actions adjusting for a OCI common shareholders' equity group.
Jim Mckinney: Now looking at our half-year performance on slide 11, we are very pleased to report a combined ratio of 92.5% for the core business. Net income of 201 million and diluted book value per share growth of 7%. Adjusting for the net effect of the MGA actions and the impact from the loss portfolio transfer last year, net income increased 72% year on year, demonstrating the improving quality of our underlying earnings. Importantly, our first half performance is within the medium term R.O.E. guidance range of 12% to 15%. Standing at 16.7% on a headline basis, and 13% when excluding the net effect of the MGA actions.
Speaker Change: <unk>, 5%.
Now looking at our half year performance on slide 11.
Speaker Change: We are very pleased to report a combined ratio of 92, 5% for the core business net income of 201 million and diluted book value per share growth of 7%.
Speaker Change: Adjusting for the net effect of the MGA actions and the impact from the loss portfolio transfer last year net income increased 72% year on year, demonstrating the improving quality of our underlying earnings importantly, our first half performance is within the medium term ROE guidance range of 12% to 15%.
Jim Mckinney: Importantly, our first-half performance is within the medium-term ROE guidance range of 12-15%, standing at 16.7% on a headline basis and 13% when excluding the net effect of the MGA action. Looking at our consolidated MGA performance, net service fee income was up 7% compared to the prior year period of $30 million, with service margin improving by one point to a strong 24%. Looking at the half-year underwriting performance in more detail on slide 12.
Speaker Change: Standing at 16, 7% on a headline basis and 13% when excluding the net effect of the MGA actions.
Jim Mckinney: Looking at our consolidated MGA performance, net service fee income was up 7% compared to the prior year period of 30 million, with service margin improving by 1.2, a strong 24%. Looking at the half-year underwriting performance in more detail on 512, we were pleased to report an improvement in the quality of earnings by 1.5 points in our core business compared to the prior year. The additional loss ratio improved by 3.6 points, and the OUE ratio improved by 0.4 points, which in combination, more than offset the 2.5 increase in the acquisition cost ratio. Cat losses were down compared to the prior year at 6 million versus 7 million in the first half of 2023.
Speaker Change: Looking at our consolidated MGA performance net service fee income was up 7% compared to the prior year period of $30 million with service margin improving by one point to a strong 24%.
Speaker Change: Looking at the half year underwriting performance in more detail on slide 12, we.
Jim Mckinney: We were pleased to report an improvement in the quality of earnings by 1.5 points in our core business compared to the prior year. The attritional loss ratio improved by 3.6 points and the OUE ratio improved by 0.4 points, which in combination more than offset the 2.5 increase in the acquisition cost ratio. Cat losses were down compared to the prior year at $6 million versus $7 million in the first half of 2023.
Speaker Change: We were pleased to report an improvement in the quality of earnings by one five points and our core business compared to prior year. The attritional loss ratio improved by three six points in the O U E ratio improved by 0.4 points, which in combination more than offset the $2 five increase in the acquisition cost ratio.
Speaker Change: Cat losses were down compared to the prior year at $6 million versus $7 million in the first half of 2023. These remained substantially down since 2022.
Jim Mckinney: These remained substantially down since 2022.
Jim Mckinney: These remain substantially down since 2022. Now, looking at premium trends as shown on slide 13. Looking first on a discrete quarterly basis, gross premiums written increased 5% quarter-on-quarter for our core business. On a continuing lines basis, which excludes the exited cyber and workers' compensation business from 2023, gross premiums written were up 22% for the quarter. At half-year, continuing lines premium increased 6% compared to the prior year period. While runoff remains a drag on headline business performance through year-end, we expect the impact to be insignificant in 2025.
Jim Mckinney: Now looking at premium trends as shown on slide 13. Looking first on a discrete quarterly basis, gross premiums written increased 5% quarter on quarter for our core business. On a continuing line basis, which excludes the exited cyber and workers' compensation business from 2023, gross premiums written were up 22% for the quarter. At half year, continuing line premium increased 6% compared to the prior year period. While runoff remains a drag on headline business performance through year end, we expect the impact to be insignificant in 2025. The continuing lines growth was driven by the insurance and service segment, where we had double-digit growth in all specialisms, and we saw growth led by both North America and international programs. This growth included significant contributions from programs launched in 2023, as momentum builds in our distribution strategy that is beginning to bear fruit.
Now looking at premium trends as shown on slide 13.
Speaker Change: Looking first on a discrete quarterly basis gross premiums written increased 5% quarter on quarter for our core business on a continuing lines basis, which excludes the exited cyber and workers' compensation business from 2023 gross premiums written were up 22% for the quarter and half year continuing lines.
Speaker Change: Premium increased 6% compared to the prior year period, while runoff remains a drag on headline business performance through year end, we expect the impact to be insignificant in 2025, and continuing lines growth was driven by the insurance and service segment, where we had double digit growth in all Specialisms and we saw growth led by.
Jim Mckinney: The continuing lines growth was driven by the insurance and service segment, where we had double-digit growth in all specialisms, and we saw growth led by both North America and international programs. This growth included significant contributions from programs launched in 2023 as momentum builds in our distribution strategy that is beginning to bear fruit. On the reinsurance side, premiums were down 6%.
Speaker Change: Both North America and international programs.
Speaker Change: This growth included significant contributions from programs launched in 2023 as momentum builds in our distribution strategy that is beginning to bear fruit on the reinsurance side premiums were down 6%. We continue to see reductions in U S. Casualty that were partially offset by growth in our Bermuda property and spa.
Jim Mckinney: On the reinsurance side, premiums were down 6%. We continue to see reductions in U.S. casualty that were partially offset by growth in our commuter property and specialty lines. Our underwriting first strategy means that we are targeting growing in areas that we believe will bring the best return on capital, such as North American programs and London and international programs. Our serious point structure allows us to be nimble capital allocators. In terms of rate, in the first half we saw an average rate change at around 4% across our portfolio, excluding the North American program business. Rate change was mainly driven by the U.S.
Jim Mckinney: We continue to see reductions in U.S. casualty that were partially offset by growth in our Bermuda property and specialty lines. Our underwriting first strategy means that we are targeting growth in areas that we believe will bring the best return on capital, such as North American programs and London and international programs. Our SiriusPoint structure allows us to be nimble capital allocators. In terms of rates, in the first half, we saw an average rate change of around 4% across our portfolio, excluding the North American program business. Rate change was mainly driven by the U.S. casualty and non-U.S. property portfolio. Roughly 10% of the business incepted in the second quarter, and rates were broadly flat here, excluding North American program business.
Speaker Change: T lives our underwriting first strategy means that we are targeting growing in areas that we believe will bring the best return on capital such as North American programs, and London and international programs are serious point structure allows us to be nimble capital allocators.
Speaker Change: In terms of rate in the first half we saw an average rate change at around 4% across our portfolio. Excluding the North American program business rate change was mainly driven by the U S casualty and non U S property portfolio, roughly 10% of the business in subs in the second quarter and rates were broadly flat, excluding North America.
Jim Mckinney: casualty and non-U.S. Property portfolio. Roughly 10% of the business insects in the second quarter and rates were broadly flat here excluding North American program business. Moving to renewals, the July period produced positive rate increases across the majority of lines, with an average rate change at around 2% across the reinsurance portfolio. The strongest positive rate change was seen in U.S. casualty business and other specialty lines.
Speaker Change: <unk> program business.
Jim Mckinney: Moving to Renewals. The July period produced positive rate increases across the majority of lines, with an average rate change at around 2% across the reinsurance portfolio. The strongest positive rate change was seen in U.S. casualty business and other specialty lines. Turning to our strong quarterly investment result on slide 14. Net investment income for the first half of the year was $157 million.
Speaker Change: Moving to renewals the July period produced positive rate increases across the majority of lines with an average rate change at around 2% across the reinsurance portfolio.
Speaker Change: Strong as positive rate change was seen in U S casualty business and other specialty lines.
Jim Mckinney: Turning to our strong quarterly investment result on slide 14, net investment income for the first half of the year was 157 million. As Scott mentioned earlier, we have increased our net investment income guidance from 250 million to 265, up to 275 to 285 million. Our guidance is based on four yield curves and assumes two rate cuts in the second half of the year. The portfolio continues to perform well. In the second quarter, across our fixed income portfolio, we saw no defaults. Overall, our investment strategy remains unchanged as we continue to operate a high quality, low volatility fixed income portfolio with an average credit rating at double A.
Speaker Change: Turning to our strong quarterly investment result on slide 14.
Speaker Change: Net investment income for the first half of the year was $157 million as.
As Scott mentioned earlier, we have increased our net investment income guidance from $250 million to $2 65 up to $2 $75 million to $285 million. Our guidance is based on forward yield curves and assumes two rate cuts in the second half of the year. The portfolio continues to perform well in the second quarter across our fixed income poor.
Jim Mckinney: As Scott mentioned earlier, we have increased our net investment income guidance from $250 million to $265 to $275 to $285 million. Our guidance is based on forward yield curves and assumes two rate cuts in the second half of the year. The portfolio continues to perform well. In the second quarter, across our fixed income portfolio, we saw no defaults. Overall, our investment strategy remains unchanged as we continue to operate a high quality, low volatility fixed income portfolio with an average credit rating at AA.
Speaker Change: Folio, we saw no defaults overall, our investment strategy remains unchanged as we continue to operate a high quality low volatility fixed income portfolio with an average credit rating at double a.
Jim Mckinney: 83% of our investment portfolio is now fixed income, of which 98% is investment grade, with an average credit rating unchanged at double A. During the quarter, we saw reinvestment rates and access of 4.5%. Our portfolio duration increased slightly to three years. As a reminder, assets backing loss reserves remain fully mapped.
Speaker Change: 83% of our investment portfolio is now fixed income of which 98% is investment grade with an average credit rating unchanged at double a.
Jim Mckinney: 83% of our investment portfolio is now fixed income, of which 98% is investment grade with an average credit rating unchanged at AA. During the quarter, we saw reinvestment rates in excess of 4.5%. Our portfolio duration increased slightly to three years. As a reminder, assets backing loss reserves remain fully matched. Moving to slide 15.
Speaker Change: During the quarter, we saw reinvestment rates in excess of four 5% our portfolio duration increased slightly to three years.
Speaker Change: As a reminder assets backing loss reserves remained fully matched.
Jim Mckinney: moving to slide 15. The balance sheet is robust with an estimated 284 percent BSER ratio and significant liquidity. At quarter end, we had 2.5 billion of common shareholders' equity, this is up 4 percent versus the prior quarter. Total capital including debt stood at 3.4 billion. As a result of debt actions we took, our debt to capital ratio decreased by 3.5 points to 19.3 percent. This ratio is now within our target range; asset leverage remains stable at 2.9 times. Last, as Scott mentioned, our strong capital and liquidity positions enabled us to retry agreement with CMIG to purchase approximately 9.1 million shares and to settle the Series A's preference shares.
Speaker Change: Moving to slide 15.
Jim Mckinney: The balance sheet is robust with an estimated 284% BSER ratio and significant liquidity. At quarter end, we had $2.5 billion of common shareholders' equity. This is up 4% versus the prior quarter. Total capital, including debt, stood at $3.4 billion. As a result of the debt actions we took, our debt-to-capital ratio decreased by 3.5 points to 19.3%. This ratio is now within our target range. Last, as Scott mentioned, our strong capital and liquidity positions enabled us to reach an agreement with CMIG to purchase approximately 9.1 million shares and to settle the Series A preference shares. In addition, the board approved repurchase authorizations of approximately $300 million.
Speaker Change: The balance sheet is robust with an estimated 284% <unk> ratio and significant liquidity at quarter end, we had $2 5 billion of common shareholders' equity. This is up 4% versus the prior quarter total capital, including debt stood at $3 4 billion as a result of that actions we took our debts.
Speaker Change: Capital ratio decreased by three five points to 19, 3%. This ratio is now within our target range asset leverage remained stable at two nine times.
Scott: Last as Scott mentioned, our strong capital and liquidity position enabled us to reach agreement with <unk> to purchase approximately $9 1 million shares and to settle the series a preference shares.
Jim Mckinney: Further, the board approved repurchase authorizations of approximately $300 million. These actions demonstrate the confidence we have in our business and the flexibility we have to use our balance sheet to help maximize shareholder value.
Scott: Further the board approved repurchase authorization of approximately $300 million. These actions demonstrate the confidence we have in our business and the flexibility we have to use our balance sheet to help maximize shareholder value.
Jim Mckinney: These actions demonstrate the confidence we have in our business and the flexibility we have to use our balance sheet to help maximize shareholder value. With this, we conclude the financial section of our presentation. Our second quarter and half-year 2024 results were strong and demonstrated stable, consistent, and improving results. We expect to build on this performance and aim to deliver a 12 to 15% return on average common equity through the cycle.
Jim Mckinney: With this, we conclude the financial section of our presentation. Our second quarter and half year 2024 results were strong and demonstrate stable, consistent, and improving results. We expect to build on this performance and aim to deliver a 12 to 15 percent return on average common equity through the cycle.
Speaker Change: With this we conclude the financial section of our presentation, our second quarter and half year 2024 results were strong and demonstrate stable consistent and improving results. We expect to build on this performance and aim to deliver a 12% to 15% return on average common equity through the cycle I would like to thank you.
Jim Mckinney: I would like to thank you again for your time this morning. For any questions, please contact our investor relations team at investor.relations@seriouspoint.com.
Jim Mckinney: I would like to thank you again for your time this morning. For any questions, please contact our investor relations team at investor.relations at siriuspoint.com. I now turn the call back over to the operator. Thank you. Ladies and gentlemen, this concludes the conference call of SiriusPoint Ltd.
Speaker Change: Again for your time this morning for any questions. Please contact our Investor relations team at Investor Relations at serious points Dot com.
Unknown Executive: I now turn the call back over to the operator. Thank you.
Speaker Change: I'll now turn the call back over to the operator.
Speaker Change: Thank you.
Unknown Executive: Ladies and gentlemen, this concludes the conference of Serious Point Limited. Thank you for your participation. You may now disconnect your lines.
Operator: Ladies and gentlemen, this concludes the conference call of SiriusPoint Ltd. Thank you for your participation. You may now disconnect your lines.
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Speaker Change: Ladies and gentlemen, this concludes the conference of serious point limited. Thank you for your participation you may now disconnect your lines.
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