Enstar(US:ESGR)2023-05-04 13:30Financial Data and Key Metrics Changes - The company reported net earnings of $424 million for Q1 2023, a significant improvement compared to a net loss of $267 million in Q1 2022 [17] - Return on equity (ROE) was 9.5%, with adjusted ROE at 6.8% [17] - Book value per share grew by 7.8%, and on an adjusted basis, it increased by 7.1% [8] - The increase in net investment income was nearly double compared to Q1 2022, reflecting a rise of approximately 170 basis points in investment book yield [18] Business Line Data and Key Metrics Changes - Run-off Liability Earnings (RLE) was recorded at $10 million, with adjusted RLE at $36 million, driven by favorable claims experience in the workers' compensation book [19] - A non-recurring gain of $194 million was noted from the unwind of Enhanzed Re [7] Market Data and Key Metrics Changes - The company maintained a strong capital and liquidity position, with access to a $600 million unsecured revolving credit facility, fully unutilized as of March 31 [20] - The estimated group solvency ratio was in excess of 200% at the end of 2022 [9] Company Strategy and Development Direction - The company announced a $1.9 billion ground-up LPT transaction with QBE, which is expected to open more opportunities [2] - The company is evaluating assumed life opportunities to provide a diversified earnings profile [4] - The strategy focuses on maintaining long-term value for shareholders and reinforcing its position as a dominant legacy player in the industry [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in being well-positioned despite a challenging macro environment, noting more attractive opportunities than ever before [4] - The company has no material exposure to impacted US regional banks and is closely monitoring the situation [21] Other Important Information - The company celebrated its 30th anniversary on April 8, 2023, highlighting its pioneering role in run-off solutions [16] - Several management changes were announced, including the appointment of Orla Gregory as President and Matt Kirk as CFO [15] Q&A Session Summary Question: What are the expectations for future transactions and performance? - Management indicated that they are confident in executing additional M&A opportunities that meet internal risk-adjusted return hurdles [14] Question: How is the company positioned regarding market volatility? - The company stated that its balance sheet remains well-positioned to weather market volatility, with no debt maturities until 2029 and all debt at fixed rates [20]