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Enstar Group Limited Reports Second Quarter Results

Enstar Group Limited
Enstar Group Limited
  • Net Loss of $493 million and $775 million and Return on Equity of (9.8)% and (13.9)% for the three and six months ended June 30, 2022, driven by unrealized losses on fixed income securities in the rising interest rate environment

  • Book Value per Ordinary Share and Adjusted Book Value per Ordinary Share* of $245.93 and $241.05, respectively, as of June 30, 2022

  • Returned $163 million to shareholders through share repurchases at a weighted average discount to book value of 20.3% during the six months ended June 30, 2022

  • Agreed a Loss Portfolio Transfer with Argo Group International Holdings, Ltd. (“Argo”) covering a number of Argo’s U.S. casualty insurance portfolios, with a policy limit of $1.1 billion

HAMILTON, Bermuda, Aug. 09, 2022 (GLOBE NEWSWIRE) -- Enstar Group Limited (Nasdaq: ESGR) filed its quarterly report on Form 10-Q with the SEC earlier today. An audio presentation reviewing the second quarter 2022 results with expanded commentary is available on Enstar's investor relations website at investor.enstargroup.com.

Second Quarter 2022 Highlights:

 

 

 

 

 

  • Return on equity ("ROE") of (9.8)% and Adjusted ROE* of (2.9)% compared to 6.0% and 5.1%, respectively, in the second quarter 2021. ROE was impacted by $379 million of net unrealized losses arising from interest rate increases on fixed maturity portfolios that are classified as trading, combined with $212 million of net unrealized losses in Enstar's non-core portfolios.

  • The market dislocation has resulted in material unrealized losses in our investment portfolio impacted by the combination of interest rate increases, widening credit spreads and equity market declines. While we recognized net investment losses of $522 million in the quarter, we are confident in our investment strategies for the long term.

  • Positively, our solvency or economic balance sheet became stronger during the second quarter. This is driven by two factors:

    • First, our solvency ratio reflects not only losses on investments but also the impact of a higher discount rate on our reserves; and

    • Secondly, our core fixed income securities are shorter in duration than our insurance liabilities.

  • Our quarter's run-off liability earnings ("RLE") benefited from reductions in the value of certain portfolios that are held at fair value and favorable loss activity in the professional indemnity/directors and officers and workers' compensation lines of business net of amortization of deferred charge assets ("DCAs").

  • On August 8, 2022, we executed an LPT agreement with a wholly owned subsidiary of Argo covering a number of its U.S. casualty insurance portfolios, including construction, for accident years 2011 to 2019. We will provide ground up cover of $746 million, and an additional $275 million of cover in excess of $821 million, up to a policy limit of $1.1 billion. Argo will retain a loss corridor of $75 million up to $821 million. The closing of the transaction is subject to regulatory approval and other closing conditions which we expect to be completed in the second half of 2022.

* Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.

Commenting on the Company’s results, Enstar CEO Dominic Silvester said:

 

“We completed one of our largest-ever loss portfolio transactions in the quarter, assuming an incremental $1.9 billion of subject loss reserves from Aspen, an established business partner, and transitioned claims management authority to Enstar. In addition, on August 8, 2022, we announced a reinsurance agreement with Argo which will provide us with the opportunity to bring our legacy expertise to the run-off of Argo’s US casualty book.

Our second quarter financial results continued to be impacted by unrealized investment losses, resulting from rising interest rates and ongoing economic uncertainty. Our fixed income portfolio has incurred a significant amount of the unrealized losses. However, it is important to keep in mind that this portfolio is designed to largely complement the maturity of underlying loss reserves and as such, we expect the losses to unwind over time. Overall, we remain confident that our investment strategy can generate strong value for the long term. We maintain a strong balance sheet with capacity to continue to pursue our active pipeline of opportunities and remain focused on delivering long-term value to our partners and shareholders.

We are seeing a robust market demand for our solutions and we maintain discipline with respect to acquiring new business and will only execute on transactions where we can generate appropriate risk-adjusted returns.”

Six months ended results included:

 

  • Net loss of $775 million, or $44.54 per diluted ordinary share, compared to net earnings of $561 million, or $25.60 per diluted ordinary share, for the six months ended June 30, 2021.

  • ROE of (13.9)% and Adjusted ROE* of (4.2)%, compared to 9.1% and 10.9%, respectively, for the six months ended June 30, 2021. ROE was impacted by unrealized losses arising from interest rate increases on fixed maturity portfolios that are classified trading combined with unrealized losses in Enstar's non-core portfolios.

  • Annualized RLE of 3.7% and Annualized Adjusted RLE* of 0.5%, compared to 2.5% and 1.1%, respectively, for the six months ended June 30, 2021. RLE benefited from reductions in the value of certain portfolios that are held at fair value, favorable loss activity in the professional indemnity/directors and officers and workers' compensation lines of business net of amortization of DCAs, and favorable results on Enstar's inactive catastrophe programs held by Enhanzed Re.

  • Annualized total investment return ("TIR") of (8.1)% and Annualized Adjusted TIR* of (0.8)%, compared to 6.8% and 8.0%, respectively, for the six months ended June 30, 2021. Recognized investment results were impacted by the combination of interest rate increases, widening credit spreads and equity market declines.

  • We repurchased 697,580 voting ordinary shares during the six months ended June 30, 2022 for an aggregate $163 million, representing an average price per share of $233.92 and a weighted average discount to our net book value per ordinary share of 20.3%. During the six months ended June 30, 2022, we utilized $105 million of the $200 million authorized under the 2022 Repurchase Program and the remaining $59 million authorized under the 2021 Repurchase Program to repurchase our ordinary shares.

* Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.

Key Financial and Operating Metrics

 

We use the following GAAP and Non-GAAP measures to monitor the performance of and manage the company:

 

Three Months Ended

 

 

 

Six Months Ended

 

 

 

June 30,
2022

 

June 30,
2021

 

$ / pp / bp
Change

 

June 30,
2022

 

June 30,
2021

 

$ / pp / bp
Change

 

(in millions of U.S. dollars, except per share data)

Key Earnings Metrics

 

 

 

 

 

 

 

 

 

 

 

Net (loss) earnings attributable to Enstar ordinary shareholders

$

(493

)

 

$

378

 

 

$

(871

)

 

$

(775

)

 

$

561

 

 

$

(1,336

)

Adjusted operating (loss) income attributable to Enstar ordinary shareholders*

$

(150

)

 

$

296

 

 

$

(446

)

 

$

(223

)

 

$

591

 

 

$

(814

)

ROE

 

(9.8

)%

 

 

6.0

%

 

 

(15.8

)pp

 

 

(13.9

)%

 

 

9.1

%

 

 

(23.0

)pp

Annualized ROE

 

 

 

 

 

 

 

 

 

 

 

 

 

(27.7

)%

 

 

18.2

%

 

 

(45.9

)pp

Adjusted ROE*

 

(2.9

)%

 

 

5.1

%

 

 

(8.0

)pp

 

 

(4.2

)%

 

 

10.9

%

 

 

(15.1

)pp

Annualized Adjusted ROE*

 

 

 

 

 

 

 

 

 

 

 

 

 

(8.4

)%

 

 

21.7

%

 

 

(30.1

)pp

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Run-off Metrics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prior period development

$

79

 

 

$

10

 

 

$

69

 

 

$

222

 

 

$

120

 

 

$

102

 

Adjusted prior period development*

$

29

 

 

$

24

 

 

$

5

 

 

$

28

 

 

$

50

 

 

$

(22

)

Annualized RLE

 

 

 

 

 

 

 

 

 

 

 

 

 

3.7

%

 

 

2.5

%

 

 

1.2

pp

Annualized Adjusted RLE*

 

 

 

 

 

 

 

 

 

 

 

 

 

0.5

%

 

 

1.1

%

 

 

(0.6

)pp

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Key Investment Return Metrics

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total investable assets

 

 

 

 

 

 

 

 

 

 

 

 

$

20,869

 

 

$

20,169

 

 

$

700

 

Adjusted total investable assets*

 

 

 

 

 

 

 

 

 

 

 

 

$

22,115

 

 

$

19,830

 

 

$

2,285

 

Annualized investment book yield

 

2.32

%

 

 

2.65

%

 

 

(33

)bp

 

 

2.03

%

 

 

2.24

%

 

 

(21

)bp

Annualized TIR

 

 

 

 

 

 

 

 

 

 

 

 

 

(8.1

)%

 

 

6.8

%

 

 

(14.9

)pp

Annualized Adjusted TIR*

 

 

 

 

 

 

 

 

 

 

 

 

 

(0.8

)%

 

 

8.0

%

 

 

(8.8

)pp

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As of

 

 

 

 

 

 

 

 

 

June 30, 2022

 

December 31, 2021

 

 

Key Shareholder Metrics

 

 

 

 

 

 

 

 

 

 

 

Book value per ordinary share

 

 

 

 

 

 

$

245.93

 

 

$

316.34

 

 

$

(70.41

)

Adjusted book value per ordinary share*

 

 

 

 

 

 

$

241.05

 

 

$

310.80

 

 

$

(69.75

)

pp - Percentage point(s)

bp - Basis point(s)

* Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.


Results of Operations by Segment - For the Three and Six Months Ended June 30, 2022 and 2021

 

Run-off Segment

The following is a discussion and analysis of the results of operations for our Run-off segment.

 

Three Months Ended

 

 

 

Six Months Ended

 

 

 

June 30,

 

 

$

 

 

June 30,

 

 

$

 

 

 

2022

 

 

 

2021

 

 

 

Change

 

 

 

2022

 

 

 

2021

 

 

 

Change

 

INCOME

(in millions of U.S. dollars)

Net premiums earned

$

9

 

 

$

42

 

 

$

(33

)

 

$

26

 

 

$

115

 

 

$

(89

)

Other income:

 

 

 

 

 

 

 

 

 

 

 

Reduction in estimates of net ultimate defendant A&E liabilities - prior periods

 

1

 

 

 

5

 

 

 

(4

)

 

 

4

 

 

 

14

 

 

 

(10

)

Reduction in estimated future defendant A&E expenses

 

1

 

 

 

 

 

 

1

 

 

 

1

 

 

 

3

 

 

 

(2

)

All other income

 

5

 

 

 

9

 

 

 

(4

)

 

 

12

 

 

 

19

 

 

 

(7

)

Total other income

 

7

 

 

 

14

 

 

 

(7

)

 

 

17

 

 

 

36

 

 

 

(19

)

Total income

 

16

 

 

 

56

 

 

 

(40

)

 

 

43

 

 

 

151

 

 

 

(108

)

 

 

 

 

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Net incurred losses and LAE:

 

 

 

 

 

 

 

 

 

 

 

Current period

 

14

 

 

 

42

 

 

 

(28

)

 

 

25

 

 

 

86

 

 

 

(61

)

Prior periods:

 

 

 

 

 

 

 

 

 

 

 

Reduction in estimates of net ultimate losses

 

(108

)

 

 

(42

)

 

 

(66

)

 

 

(137

)

 

 

(67

)

 

 

(70

)

Reduction in provisions for ULAE

 

(13

)

 

 

(17

)

 

 

4

 

 

 

(34

)

 

 

(31

)

 

 

(3

)

Total prior periods

 

(121

)

 

 

(59

)

 

 

(62

)

 

 

(171

)

 

 

(98

)

 

 

(73

)

Total net incurred losses and LAE

 

(107

)

 

 

(17

)

 

 

(90

)

 

 

(146

)

 

 

(12

)

 

 

(134

)

Acquisition costs

 

9

 

 

 

 

 

 

9

 

 

 

17

 

 

 

29

 

 

 

(12

)

General and administrative expenses (1)

 

36

 

 

 

64

 

 

 

(28

)

 

 

75

 

 

 

92

 

 

 

(17

)

Total expenses

 

(62

)

 

 

47

 

 

 

(109

)

 

 

(54

)

 

 

109

 

 

 

(163

)

 

 

 

 

 

 

 

 

 

 

 

 

SEGMENT NET EARNINGS

$

78

 

 

$

9

 

 

$

69

 

 

$

97

 

 

$

42

 

 

$

55

 


(1)

Second quarter 2021 results include incremental expenses attributable to the first quarter 2021 general and administrative expenses following a refinement made to the allocation of expenses in the second quarter of 2021, which increased the general and administrative expenses of the Run-off segment for the three months ended June 30, 2021 by $16 million.

Three and Six Months Ended June 30, 2022 versus 2021: Net earnings from our Run-off segment increased by $69 million and $55 million, respectively, primarily due to:

  • A $62 million and $73 million increase in favorable PPD for the three and six months ended June 30, 2022, respectively, driven by a $66 million and $70 million increase in the reduction in estimates of net ultimate losses, respectively, primarily due to favorable loss activity in the professional indemnity/directors and officers and workers’ compensation lines of business; and

  • A decrease in general and administrative expenses of $28 million and $17 million, respectively. Excluding the impact of the refinement made to the allocation of expenses in the second quarter of 2021 as described above, these decreases were primarily driven by lower salaries and benefits due to reductions in head count and long-term incentive plan costs and decreases in professional fees for the three and six months ended June 30, 2022; partially offset by

  • Reductions in net premiums earned that were greater than the reductions in current period net incurred losses and LAE for the three and six months ended June 30, 2022, following our exit of our StarStone International business beginning in 2020; and

  • A reduction in other income of $7 million and $19 million, respectively, primarily driven by lower favorable prior period development related to our defendant A&E liabilities for the three and six months ended June 30, 2022.


Investments Segment

The following is a discussion and analysis of the results of operations for our Investments segment.

 

Three Months Ended

 

 

 

Six Months Ended

 

 

 

June 30,

 

 

 $

 

 

June 30,

 

 

 $

 

 

 

2022

 

 

 

2021

 

 

 

Change

 

 

 

2022

 

 

 

2021

 

 

 

Change

 

 

(in millions of U.S. dollars)

INCOME

 

 

 

 

 

 

 

 

 

 

 

Net investment income:

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

$

85

 

 

$

87

 

 

$

(2

)

 

$

153

 

 

$

138

 

 

$

15

 

Cash and restricted cash

 

1

 

 

 

 

 

 

1

 

 

 

1

 

 

 

 

 

 

1

 

Other investments, including equities

 

22

 

 

 

15

 

 

 

7

 

 

 

41

 

 

 

29

 

 

 

12

 

Less: Investment expenses

 

(4

)

 

 

(26

)

 

 

22

 

 

 

(15

)

 

 

(30

)

 

 

15

 

Total net investment income

 

104

 

 

 

76

 

 

 

28

 

 

 

180

 

 

 

137

 

 

 

43

 

Net realized (losses) gains:

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

(30

)

 

 

5

 

 

 

(35

)

 

 

(65

)

 

 

(6

)

 

 

(59

)

Other investments, including equities

 

(8

)

 

 

1

 

 

 

(9

)

 

 

(10

)

 

 

2

 

 

 

(12

)

Net realized (losses) gains:

 

(38

)

 

 

6

 

 

 

(44

)

 

 

(75

)

 

 

(4

)

 

 

(71

)

Net unrealized (losses) gains:

 

 

 

 

 

 

 

 

 

 

 

Fixed income securities

 

(377

)

 

 

105

 

 

 

(482

)

 

 

(670

)

 

 

(89

)

 

 

(581

)

Other investments, including equities

 

(212

)

 

 

295

 

 

 

(507

)

 

 

(294

)

 

 

479

 

 

 

(773

)

Total net unrealized (losses) gains:

 

(589

)

 

 

400

 

 

 

(989

)

 

 

(964

)

 

 

390

 

 

 

(1,354

)

Total income

 

(523

)

 

 

482

 

 

 

(1,005

)

 

 

(859

)

 

 

523

 

 

 

(1,382

)

 

 

 

 

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses (1)

 

10

 

 

 

13

 

 

 

(3

)

 

 

19

 

 

 

16

 

 

 

3

 

Total expenses

 

10

 

 

 

13

 

 

 

(3

)

 

 

19

 

 

 

16

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (losses) from equity method investments

 

1

 

 

 

(3

)

 

 

4

 

 

 

32

 

 

 

115

 

 

 

(83

)

 

 

 

 

 

 

 

 

 

 

 

 

SEGMENT NET (LOSS) EARNINGS

$

(532

)

 

$

466

 

 

$

(998

)

 

$

(846

)

 

$

622

 

 

$

(1,468

)


(1)

Second quarter 2021 results include incremental expenses attributable to the first quarter 2021 general and administrative expenses following a refinement made to the allocation of expenses in the second quarter of 2021, which increased the general and administrative expenses of the Investments segment for the three months ended June 30, 2021 by $3 million.


Three and Six Months Ended June 30, 2022 versus 2021:
Net loss from our Investments segment was $532 million and $846 million for the three and six months ended June 30, 2022, respectively, compared to net earnings of $466 million and $622 million for the three and six months ended June 30, 2021. The unfavorable movements of $998 million and $1.5 billion, respectively, were primarily due to:

  • net realized and unrealized losses on our fixed income securities of $407 million and $735 million, respectively, driven by rising interest rates and widening credit spreads, in comparison to net gains of $110 million and net losses of $95 million, respectively, in the comparative periods;

  • net realized and unrealized losses on our other investments, including equities, of $220 million and $304 million, respectively, in comparison to net gains of $296 million and $481 million, respectively, in the comparative periods, primarily driven by underperformance of our fixed income funds, public equities and CLO equities as a result of significant volatility in global equity markets and widening high yield credit spreads. The results were partially offset by gains on our private equity funds, private credit funds and real estate funds, which are typically recorded on a one quarter lag, and net gains on our hedge funds for the three months ended June 30, 2022 as a result of exposure to Chinese equities; and

  • an $83 million decrease in earnings from equity method investments for the six months ended June 30, 2022, largely due to our acquisition of the controlling interest in Enhanzed Re, effective September 1, 2021 (consolidated net loss from Enhanzed Re was $95 million for the six months ended June 30, 2022). Prior to that date, the results of Enhanzed Re were recorded in earnings from equity method investments within the Investments segment; partially offset by:

  • increases in our net investment income of $28 million and $43 million, respectively, which is primarily due to an increase in our average aggregate fixed income assets due to new business during the past year and the reinvestment of fixed maturities at higher yields.

Net investment losses recognized on the fixed income securities that support our Enhanzed Re life reinsurance business for the three and six months ended June 30, 2022 were $109 million and $128 million, respectively.

Income and Earnings by Segment - For the Three and Six Months Ended June 30, 2022 and 2021

 


 

Three Months Ended

 

 

 

Six Months Ended

 

 

 

June 30,
2022

 

June 30,
2021

 

$ Change

 

June 30,
2022

 

June 30,
2021

 

$ Change

 

(in millions of U.S. dollars)

INCOME

 

 

 

 

 

 

 

 

 

 

 

Run-off

$

16

 

 

$

56

 

 

$

(40

)

 

$

43

 

 

$

151

 

 

$

(108

)

Enhanzed Re

 

1

 

 

 

 

 

 

1

 

 

 

15

 

 

 

 

 

 

15

 

Investments

 

(523

)

 

 

482

 

 

 

(1,005

)

 

 

(859

)

 

 

523

 

 

 

(1,382

)

Legacy Underwriting

 

6

 

 

 

15

 

 

 

(9

)

 

 

8

 

 

 

28

 

 

 

(20

)

Subtotal

 

(500

)

 

 

553

 

 

 

(1,053

)

 

 

(793

)

 

 

702

 

 

 

(1,495

)

Corporate and other

 

14

 

 

 

(6

)

 

 

20

 

 

 

17

 

 

 

4

 

 

 

13

 

Total income

$

(486

)

 

$

547

 

 

$

(1,033

)

 

$

(776

)

 

$

706

 

 

$

(1,482

)

 

 

 

 

 

 

 

 

 

 

 

 

SEGMENT NET (LOSS) EARNINGS

 

 

 

 

 

 

 

 

 

 

 

Run-off (3)

$

78

 

 

$

9

 

 

$

69

 

 

$

97

 

 

$

42

 

 

$

55

 

Enhanzed Re

 

(7

)

 

 

 

 

 

(7

)

 

 

22

 

 

 

 

 

 

22

 

Investments (3)

 

(532

)

 

 

466

 

 

 

(998

)

 

 

(846

)

 

 

622

 

 

 

(1,468

)

Legacy Underwriting

 

 

 

 

(2

)

 

 

2

 

 

 

 

 

 

 

 

 

 

Total segment net (loss) earnings

 

(461

)

 

 

473

 

 

 

(934

)

 

 

(727

)

 

 

664

 

 

 

(1,391

)

Corporate and other (1)(2)(3)

 

(32

)

 

 

(95

)

 

 

63

 

 

 

(48

)

 

 

(103

)

 

 

55

 

NET (LOSS) EARNINGS ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS

$

(493

)

 

$

378

 

 

$

(871

)

 

$

(775

)

 

$

561

 

 

$

(1,336

)


(1)

Other income (expense) for corporate and other activities includes the amortization of fair value adjustments associated with the acquisition of DCo LLC and Morse TEC LLC.

(2)

Net incurred losses and LAE for corporate and other activities includes the amortization of deferred charge assets (“DCAs”) on retroactive reinsurance contracts, fair value adjustments associated with the acquisition of companies and the changes in the discount rate and risk margin components of the fair value of assets and liabilities related to our assumed retroactive reinsurance contracts for which we have elected the fair value option. The three and six months ended June 30, 2022 included accelerated amortization of $72 million and $96 million, respectively, corresponding to increased favorable prior period development on net ultimate liabilities recorded in our Run-off segment. The three and six months ended June 30, 2021 included accelerated amortization of $11 million corresponding to increased favorable prior period development on net ultimate liabilities recorded in our Run-off segment.

(3)

Second quarter 2021 results include incremental expenses attributable to the first quarter 2021 general and administrative expenses following a refinement made to the allocation of expenses in the second quarter of 2021, which increased/(decreased) general and administrative expenses of the Run-off and Investment segments by $16 million and $3 million, respectively, as well as corporate and other activities by $(19) million, for the three months ended June 30, 2021.


For additional detail on the Enhanzed Re segment, the Legacy Underwriting segment and corporate and other activities, please refer to the Form 10-Q.

Cautionary Statement

 

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements regarding the intent, belief or current expectations of Enstar and its management team. Investors are cautioned that any such forward-looking statements speak only as of the date they are made, are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Important risk factors regarding Enstar can be found under the heading "Risk Factors" in our Form 10-K for the year ended December 31, 2021 and are incorporated herein by reference. Furthermore, Enstar undertakes no obligation to update any written or oral forward-looking statements or publicly announce any updates or revisions to any of the forward-looking statements contained herein, to reflect any change in its expectations with regard thereto or any change in events, conditions, circumstances or assumptions underlying such statements, except as required by law.

About Enstar

 

Enstar is a NASDAQ-listed leading global (re)insurance group that offers capital release solutions through its network of group companies in Bermuda, the United States, the United Kingdom, Continental Europe, Australia, and other international locations. A market leader in completing legacy acquisitions, Enstar has acquired over 110 companies and portfolios since its formation in 2001. For further information about Enstar, see www.enstargroup.com.

Contacts

 

For Investors: Matthew Kirk (investor.relations@enstargroup.com)

For Media: Jenna Kerr (communications@enstargroup.com)


ENSTAR GROUP LIMITED

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED)

For the Three and Six Months Ended June 30, 2022 and 2021

 

Three Months Ended
June 30,

 

Six Months Ended
June 30,

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

(expressed in millions of U.S. dollars, except share and per share data)

INCOME

 

 

 

 

 

 

 

Net premiums earned

$

14

 

 

$

59

 

 

$

48

 

 

$

152

 

Net investment income

 

106

 

 

 

76

 

 

 

186

 

 

 

138

 

Net realized (losses) gains

 

(38

)

 

 

6

 

 

 

(75

)

 

 

(5

)

Net unrealized (losses) gains

 

(591

)

 

 

400

 

 

 

(972

)

 

 

390

 

Other income

 

23

 

 

 

6

 

 

 

37

 

 

 

16

 

Net gain on sales of subsidiaries

 

 

 

 

 

 

 

 

 

 

15

 

Total income

 

(486

)

 

 

547

 

 

 

(776

)

 

 

706

 

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

 

Net incurred losses and loss adjustment expenses

 

 

 

 

 

 

 

Current period

 

13

 

 

 

50

 

 

 

26

 

 

 

104

 

Prior periods

 

(79

)

 

 

(10

)

 

 

(222

)

 

 

(120

)

Total net incurred losses and loss adjustment expenses

 

(66

)

 

 

40

 

 

 

(196

)

 

 

(16

)

Policyholder benefit expenses

 

6

 

 

 

 

 

 

18

 

 

 

 

Acquisition costs

 

12

 

 

 

5

 

 

 

20

 

 

 

39

 

General and administrative expenses

 

83

 

 

 

93

 

 

 

168

 

 

 

176

 

Interest expense

 

23

 

 

 

17

 

 

 

48

 

 

 

33

 

Net foreign exchange (gains)

 

(13

)

 

 

(10

)

 

 

(10

)

 

 

(7

)

Total expenses

 

45

 

 

 

145

 

 

 

48

 

 

 

225

 

 

 

 

 

 

 

 

 

(LOSS) EARNINGS BEFORE INCOME TAXES

 

(531

)

 

 

402

 

 

 

(824

)

 

 

481

 

Income tax benefit (expense)

 

4

 

 

 

(9

)

 

 

4

 

 

 

(3

)

Earnings (losses) from equity method investments

 

1

 

 

 

(3

)