SiriusPoint(SPNT) - 2023 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - SiriusPoint reported a net income of $245 million for the first nine months of 2023, a significant increase of $621 million compared to the previous year, which was impacted by negative investment returns and higher catastrophe losses [27] - The company achieved its first-ever underwriting profit in Q3 2023, with underwriting profits of $43 million and a combined ratio improvement of 19 points year-over-year to 94.8% [31] - The book value per share remained stable at $12.11 during the quarter, with a 3% increase in shareholders' equity when adjusted for AOCI [32] Business Line Data and Key Metrics Changes - Core underwriting results improved significantly, with underwriting profits of $213 million for the first nine months, benefiting from $102 million of reserve redundancy linked to a loss portfolio transfer [28] - Gross premiums written for the core business increased by 3%, driven by a rise in insurance and services, while reinsurance premiums decreased by $202 million due to portfolio restructuring [29] - Capital light net services fee income rose by 11% to $38 million, with service revenues up 7% year-over-year and margins increasing to 21% [29] Market Data and Key Metrics Changes - Average rate increases for the portfolio were around 7% in Q3, with U.S. property catastrophe rates remaining strong at 20% [33] - The company has seen a significant reduction in catastrophe losses, with core business cat losses down to $14 million year-to-date compared to $138 million in the same period last year [28] Company Strategy and Development Direction - The company is focused on building a strong unified culture and aims to be a best-in-class insurer reinsurer, prioritizing underwriting profits over premium growth in 2024 [9][24] - SiriusPoint launched the SiriusPoint International MGA Center of Excellence to enhance onboarding for new MGA partners, reflecting a commitment to operational efficiency and quality [19] - The company is reducing the number of equity stakes in MGAs to concentrate on fewer, deeper relationships, having sold seven stakes since the start of the year [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the progress made over the past 12 months and emphasized the importance of continued improvement in 2024 [24] - The company acknowledged the challenges in the market but remains committed to achieving a double-digit return on average common equity for the full year [37] - Management highlighted the need for transparency and accuracy in financial reporting, which led to revisions in the 2023 interim financials [12] Other Important Information - The company has implemented additional controls to ensure the accuracy of net premiums calculations following a manual calculation error [12] - Investment results were strong, with total investment income of $208 million, driven by net investment income of $205 million [29] Summary of Q&A Session No Q&A session for this event