TORONTO, May 10, 2023
/CNW/ - (TSX: IFC)
(in Canadian dollars except as otherwise noted)
Highlights1,2
- Operating DPW growth of 4% in Q1-2023 despite the exit
of UK personal lines motor, mainly reflecting rate actions in
supportive market conditions
- Combined ratio of 87.4% (91.9% undiscounted), reflected
solid underwriting performance in all geographies
- Net operating income per share up 4% to $3.06 on premium growth, higher investment
yields and increased distribution income
- EPS decreased to $2.06,
due in part to non-recurring UK personal lines motor exit expenses,
while ROE was 15.4%
- BVPS decreased 6% from Q4-2022 to $77.72, largely reflecting the UK pension
de-risking actions
- Balance sheet remained strong with a total capital
margin of $2.8 billion, and
debt-to-total capital ratio on track to return towards 20% by year
end 2023
Charles Brindamour, Chief
Executive Officer, said:
"The business delivered another strong quarter, with a
mid-teens operating ROE and solid results in all geographies. Since
closing the RSA acquisition, we have been active in improving
performance and de-risking the transaction. The UK&I segment is
now well along the path to outperformance, and we expect it to
reach a low-90s combined ratio by the end of 2024, a year ahead of
schedule. I remain confident in the outlook for Intact as a whole,
and our strong balance sheet positions us to capture opportunities
as they arise."
Consolidated
Highlights
(in millions of Canadian dollars except as otherwise
noted)
|
Q1-2023
|
Q1-2022 restated3
|
Change
|
Operating direct
premiums written1, 2
|
4,809
|
4,656
|
4 %
|
Combined ratio
(discounted)2
|
87.4 %
|
88.9 %
|
(1.5) pts
|
Combined ratio
(undiscounted)2
|
91.9 %
|
92.1 %
|
(0.2) pts
|
Underwriting
income2
|
613
|
531
|
15 %
|
Operating net
investment income2
|
295
|
205
|
44 %
|
Net unwind of discount
on claims liabilities2
|
(226)
|
(83)
|
nm
|
Operating net
investment result2
|
69
|
122
|
(43) %
|
Distribution
income2
|
105
|
92
|
14 %
|
Net operating income
attributable to common shareholders2
|
537
|
516
|
4 %
|
Net
income
|
377
|
487
|
(23) %
|
Per share measures
(in dollars)
|
|
|
|
Net operating income
per share (NOIPS)2
|
$3.06
|
$2.93
|
4 %
|
Earnings per share
(EPS)
|
$2.06
|
$2.76
|
(25) %
|
Book value per
share2
|
$77.72
|
$84.78
|
(8) %
|
Return on equity for
the last 12 months
|
|
|
|
Operating
ROE2
|
14.1 %
|
16.6 %
|
n/a
|
ROE2
|
15.4 %
|
14.9 %
|
n/a
|
Total capital
margin2
|
2,796
|
2,567
|
9 %
|
Adjusted debt-to-total
capital ratio2
|
22.4 %
|
23.4 %
|
(1.0) pt
|
12-Month Industry Outlook
- Over the next twelve months, we expect firm-to-hard insurance
market conditions to continue in most lines of business, driven by
inflation, natural disasters, and a hard reinsurance market.
- In Canada, we expect firm
market conditions to continue in personal property. Personal auto
premiums are expected to grow by mid-to-high single-digits in
response to inflation and evolving driving patterns.
- In commercial and specialty lines across all geographies, we
continue to expect hard market conditions in most lines of
business.
- In the UK&I, the personal property market has begun to firm
but further rate increases are required to deal with inflationary
pressures, natural disasters and a hard reinsurance market.
___________
|
1 DPW
change (growth) is presented in constant currency.
|
2 This
release contains non-GAAP financial measures and Non-GAAP ratios
(each as defined in National Instrument 52-112 "Non-GAAP and Other
Financial Measures Disclosure"). Refer to Section 23 – Non-GAAP and
other financial measures in the Q1-2023 Management's Discussion and
Analysis for further details.
|
3
Q1-2022 comparatives were restated for IFRS 17 but not for
IFRS 9. OROE and ROE are not restated for IFRS 17, given that 2021
P&L figures were not restated for IFRS 17.
|
Segment Results
(in millions of
Canadian dollars except as otherwise noted)
|
Q1-2023
|
Q1-2022 restated
|
Change
|
Operating direct
premiums written1,2
|
Canada
|
2,996
|
2,893
|
4 %
|
UK&I
|
1,235
|
1,292
|
(1) %
|
US
|
578
|
471
|
15 %
|
Total
|
4,809
|
4,656
|
4 %
|
Combined
ratio2
|
Canada
|
91.7 %
|
91.1 %
|
0.6 pts
|
UK&I
|
94.6 %
|
98.2 %
|
(3.6) pts
|
US
|
89.1 %
|
86.8 %
|
2.3 pts
|
Combined ratio
(undiscounted)
|
91.9 %
|
92.1 %
|
(0.2) pts
|
Impact of
discounting3
|
(4.5) %
|
(3.2) %
|
(1.3) pts
|
Combined ratio
(discounted)
|
87.4 %
|
88.9 %
|
(1.5) pts
|
Q1-2023 Consolidated Performance
- Operating DPW grew by 4%, or 5% excluding strategic
exits (such as UK personal lines motor and certain delegated
relationships), reflecting solid rate momentum across all
geographies.
- Underwriting performance was solid with an overall combined
ratio of 91.9% (undiscounted) despite higher inflation,
primarily due to profitability actions including rate increases,
milder weather, and exit of UK personal lines motor.
- Including the impact of discounting, the overall combined
ratio of 87.4% was 1.5 points better than last year. This is
primarily due to $219 million of
underwriting discount build at higher interest rates compared to
last year, the impact of which is largely offset this quarter with
a $226 million discount unwind
reported in operating net investment result under IFRS-17.
- Operating net investment income of $295 million for the quarter increased 44%
year-over-year, following actions to turn over the portfolio at
higher reinvestment yields.
- Distribution income grew 14% to $105 million, driven by accretive
acquisitions and continued strong profitability.
Lines of Business4
P&C
Canada
- Personal auto premiums increased 5% from the prior year,
improving three points from the preceding quarter as a result of
rate actions in firming market conditions. The combined ratio of
97.1% reflects winter seasonality and elevated but moderating
inflation. We expect to remain at a seasonally adjusted sub-95
combined ratio in the next 12 months.
- Personal property premiums grew by 6% in firm market
conditions. The combined ratio was strong at 84.5%, improving 3.8
points from the prior year due to profitability actions and
favourable weather in the quarter.
- Commercial lines premium growth of 0.4% reflect
continued rate increases and strong retention in most lines, offset
by targeted actions to optimize the portfolio and increased
competition for large accounts in Specialty Lines. The combined
ratio was a solid 90.8%, 0.9 points higher than last year due to a
large fire related catastrophe loss and more modest favourable
prior-year development.
P&C UK&I
- Personal lines premiums declined 11% on a constant
currency basis. Excluding impact of the UK personal lines motor
market exit, growth would have been flat in the quarter. We
remained disciplined in firming but still competitive market
conditions, prioritizing risk selection, improving pricing
sophistication and managing partnerships for value. The combined
ratio of 107.3% includes 4 points impact from the December 2022 freeze event, as well as
inflationary pressures which we are actively addressing with the
above measures.
- Commercial lines premiums grew 3% on a constant currency
basis, as continued strong rate increases were tempered 3 points by
strategic exits. The combined ratio improved 2.1 points to a strong
88.2%, with benign catastrophe losses in the quarter.
P&C U.S.
- US Commercial premiums grew 15% on a constant currency
basis, driven by new products (following the Highland MGA
acquisition last year), new business, and rate increases. The
combined ratio remained solid at 89.1%, but 2.3 points higher than
last year due to a large fire-related catastrophe loss and
unfavourable weather.
___________
|
1 DPW
change (growth) is presented in constant currency.
|
2 This
release contains non-GAAP financial measures and Non-GAAP ratios
(each as defined in National Instrument 52-112 "Non-GAAP and Other
Financial Measures Disclosure"). Refer to Section 23 – Non-GAAP and
other financial measures in the Q1-2023 Management's Discussion and
Analysis for further details.
|
3 Includes
the impact of discount build on our claims liabilities for all
P&C segments. Refer to Section 3 - IFRS 17 transitional
impact in the Q1-2023 Management's Discussion and Analysis for
further details.
|
4 Combined
ratios within the Lines of Business are reported on an undiscounted
basis
|
Net Operating Income, EPS and ROE
- Net operating income attributable to common shareholders
of $537 million increased 4%
from Q1-2022, on premium growth, higher investment yields and
increased distribution income.
- Earnings per share of $2.06 were 25% lower than last year. The
increase in operating earnings was more than offset by higher
exited lines and restructuring costs as a result of the UK personal
lines motor exit, a temporary increase in effective tax rate, as
well as mark-to-market losses on equity investments.
- Operating ROE of 14.1% and ROE of 15.4% for the
12 months to March 31, 2023 reflected
strong operating performance.
Balance Sheet
- The Company ended the quarter in a strong financial position,
with a total capital margin of $2.8
billion and solid regulatory capital ratios in all
jurisdictions, as solid earnings offset the impact of UK pension
de-risking activities.
- The adjusted debt-to-total capital ratio increased
to 22.4% as at March 31,
2023, in line with our expectations following the UK pension
buy-in transaction. We remain on track to return towards our target
of 20% by year end 2023.
- IFC's book value per share (BVPS) was $77.72 at March 31,
2023, down 6% from Q4-2022. Solid earnings and favourable
market movements were offset by the impact of UK pension de-risking
actions.
RSA Acquisition
- RSA contributed approximately 16% accretion to NOIPS
over the last twelve months.
- In the quarter, we further de-risked the acquisition by
entering into a UK pension buy-in agreement with Pension
insurance Corporation plc to transfer substantially all
remaining economic and demographic risks associated with the UK
Pension schemes to a strong and specialized insurance counterparty.
We also exited the UK personal lines motor market to focus
on our leading positions in personal lines Home and Pet
insurance.
- We are on track to realize at least $350 million of pre-tax annual run-rate synergies
in 2024. As at March 31, 2023 we
estimate that we delivered $285
million in annualized run-rate synergies.
- Integration activities are progressing well. The
conversion of policies outside of Johnson and specialty lines to
Intact systems has been completed. In direct distribution, 50% of
Johnson's retail policies have converted to belairdirect so far.
Conversion of specialty lines and Johnson's affinity policies will
begin later this year.
Common Share Dividend
- The Board of Directors approved the quarterly dividend to
$1.10 per share on the Company's
outstanding common shares. The dividends are payable on
June 30, 2023, to shareholders of
record on June 15, 2023.
Preferred Share Dividends
- The Board of Directors also approved a quarterly dividend of
30.25625 cents per share on the
Company's Class A Series 1 preferred shares, 21.60625 cents per share on the Class A Series 3
preferred shares, 32.50 cents per
share on the Class A Series 5 preferred shares, 33.125 cents per share on the Class A Series 6
preferred shares, 30.625 cents per
share on the Class A Series 7 preferred shares, 33.75 cents per share on the Class A Series 9
preferred shares, and 32.8125 cents
per share on the Class A Series 11 preferred shares. The dividends
are payable on June 30, 2023, to
shareholders of record on June 15,
2023.
Analysts' Estimates
- The average estimate of earnings per share and net
operating income per share for the quarter among the analysts
who follow the Company was $2.48 and
$2.95, respectively.
Management's Discussion and Analysis (MD&A) and interim
condensed Consolidated Financial Statements
This Press Release, which was approved by the Company's Board of
Directors on the Audit Committee's recommendation, should be read
in conjunction with the Q1-2023 MD&A, as well as the Q1-2023
interim condensed Consolidated Financial Statements, which are
available on the Company's website at www.intactfc.com and later
today on SEDAR at www.sedar.com.
For the definitions of measures and other insurance-related
terms used in this Press Release, please refer to the MD&A and
to the glossary available in the "Investors" section of the
Company's website at www.intactfc.com.
Conference Call Details
Intact Financial Corporation will host a conference call to
review its earnings results tomorrow at 11:00 a.m. ET. To listen to the call via live
audio webcast and to view the Company's interim Consolidated
Financial Statements, MD&A, presentation slides, Supplementary
financial information and other information not included in this
press release, visit the Company's website at www.intactfc.com and
link to "Investors". The conference call is also available by
dialing 416-764-8659 or 1-888-664-6392 (toll-free in North America). Please call 10 minutes before
the start of the call. A replay of the call will be available on
May 11, 2023 at 2:00 p.m. ET until midnight on May 18, 2023. To listen to the replay, call
416-764-8677 or 1-888-390-0541 (toll-free in North America), entry code 688543. A
transcript of the call will also be made available on Intact
Financial Corporation's website.
About Intact Financial
Corporation
Intact Financial Corporation (TSX: IFC) is the largest provider
of property and casualty (P&C) insurance in Canada, a leading provider of global specialty
insurance, and, with RSA, a leader in the U.K. and Ireland. Our business has grown organically
and through acquisitions to over $21
billion of total annual premiums.
In Canada, Intact distributes
insurance under the Intact Insurance brand through a wide network
of brokers, including its wholly-owned subsidiary BrokerLink, and
directly to consumers through belairdirect. Intact also provides
affinity insurance solutions through the Johnson Affinity
Groups.
In the U.S., Intact Insurance Specialty Solutions provides a
range of specialty insurance products and services through
independent agencies, regional and national brokers, and
wholesalers and managing general agencies.
In the U.K., Ireland, and
Europe, Intact provides personal,
commercial and specialty insurance solutions through the RSA
brands.
Non-GAAP and other financial measures
Non-GAAP financial measures and Non-GAAP ratios (which are
calculated using Non-GAAP financial measures) do not have
standardized meanings prescribed by IFRS (or GAAP) and may not be
comparable to similar measures used by other companies in our
industry. Non-GAAP and other financial measures are used by
management and financial analysts to assess our performance.
Further, they provide users with an enhanced understanding of our
financial results and related trends, and increase transparency and
clarity into the core results of the business.
Non-GAAP financial measures and Non-GAAP ratios used in this
Press Release and the Company's financial reports include measures
related to our consolidated performance, our underwriting
performance and our financial strength.
For more information about these supplementary financial
measures, Non-GAAP financial measures, and Non-GAAP ratios,
including definitions and explanations of how these measures
provide useful information, refer to Section 23 – Non-GAAP and
other financial measures in the Q1-2023 MD&A dated May 10, 2023, which is available on our website
at www.intactfc.com and on SEDAR at www.sedar.com.
Table 1
Reconciliation of NOI, NOIPS and OROE to Net income attributable
to shareholders, as reported under IFRS
|
Q1-2023
|
Q1-2022
Restated
1
|
|
|
|
Net income
attributable to shareholders, as reported under IFRS
|
377
|
499
|
Remove: Pre-tax
non-operating losses (gains)
|
141
|
2
|
Remove: Non-operating
tax expense (benefit)
|
35
|
46
|
Remove: Non operating
component of NCI
|
-
|
(18)
|
NOI attributable to
shareholders
|
553
|
529
|
Remove: preferred share
dividends and other
|
(16)
|
(13)
|
NOI attributable to
common shareholders
|
537
|
516
|
Divided by
weighted-average number of common shares (in millions)
|
175.3
|
176.1
|
NOIPS, basic and
diluted (in dollars)
|
3.06
|
2.93
|
NOI to common
shareholders for the last 12 months2
|
2,114
|
2,148
|
Adjusted average common
shareholders' equity, excluding AOCI2
|
15,039
|
12,966
|
OROE for the last 12
months2
|
14.1 %
|
16.6 %
|
1 Restated for the adoption of
IFRS 17 – Insurance contracts
|
2 These
measures are not restated for IFRS 17, given that the 2021 P&L
figures were not restated for IFRS 17
|
Table 2
Reconciliation of underwriting results on a MD&A basis with
the interim condensed consolidated financial statements
Financial
statements
|
FS
IFRS 17
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
9
|
Total
|
MD&A IFRS
17
|
MD&A
|
For the quarter
ended March 31, 2023
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance
revenue
|
6,354
|
(847)
|
(80)
|
|
|
|
(541)
|
|
(59)
|
37
|
(1,490)
|
4,864
|
Operating net
underwriting revenue
|
Insurance service
expense
|
(5,596)
|
733
|
140
|
(86)
|
6
|
(35)
|
565
|
|
59
|
(37)
|
1,345
|
(4,251)
|
Sum of: Operating net
claims ($2,599
million) and Operating net underwriting
expenses ($1,652 million)
|
Allocation of
reinsurance premiums
|
(847)
|
847
|
|
|
|
|
|
|
|
|
847
|
-
|
n/a
|
Amounts recoverable
from reinsurers
|
733
|
(733)
|
|
|
|
|
|
|
|
|
(733)
|
-
|
n/a
|
Insurance service
result
|
644
|
-
|
60
|
(86)
|
6
|
(35)
|
24
|
-
|
-
|
-
|
(31)
|
613
|
Underwriting income
(loss)
|
For the quarter
ended March 31, 2022
|
|
|
|
|
|
|
|
|
|
|
|
|
Insurance
revenue
|
6,806
|
(886)
|
(148)
|
|
|
|
(984)
|
|
(56)
|
29
|
(2,045)
|
4,761
|
Operating net
underwriting revenue
|
Insurance service
expense
|
(6,042)
|
692
|
182
|
(109)
|
12
|
(22)
|
991
|
39
|
56
|
(29)
|
1,812
|
(4,230)
|
Sum of: Operating net
claims ($2,663
million) and Operating net underwriting
expenses ($1,567 million)
|
Allocation of
reinsurance premiums
|
(886)
|
886
|
|
|
|
|
|
|
|
|
886
|
-
|
n/a
|
Amounts recoverable
from reinsurers
|
692
|
(692)
|
|
|
|
|
|
|
|
|
(692)
|
-
|
n/a
|
Insurance service
result
|
570
|
-
|
34
|
(109)
|
12
|
(22)
|
7
|
39
|
-
|
-
|
(39)
|
531
|
Underwriting income
(loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciling items in the table above:
1
|
Adjustment to present
results net of reinsurance
|
2
|
Adjustment to exclude
net underwriting revenue, net claims, net underwriting expenses
from exited lines (treated as non-operating)
|
3
|
Adjustment to include
indirect underwriting expenses (from Other income and expense under
IFRS)
|
4
|
Adjustment to exclude
the non-operating pension expense
|
5
|
Adjustment to
reclassify intercompany commissions (to Distribution income &
Other corporate income (expense))
|
6
|
Adjustment to exclude
Net insurance service results from claims acquired in a business
combination (treated as non-operating)
|
7
|
Adjustment to normalize
discount build in IFRS 17 transition year (from Net insurance
financial result under IFRS)
|
8
|
Adjustment to
reclassify Assumed (ceded) commissions and premium
adjustments
|
9
|
Adjustment to
reclassify Net insurance revenue from retroactive reinsurance
contracts
|
Table 3
Reconciliation of the components within Operating net
claims
|
|
|
Q1-2023
|
Q1-2022
Restated
|
|
|
|
|
|
Operating net
claims, as reported in Table 2
|
|
|
2,599
|
2,663
|
Remove: net current
year CAT losses
|
|
|
(108)
|
(182)
|
Remove: favourable
(unfavourable) PYD
|
|
|
259
|
283
|
|
|
|
|
|
Operating net claims
excluding current year CAT losses and PYD
|
|
|
2,750
|
2,764
|
Operating net
underwriting revenue
|
|
|
4,864
|
4,761
|
|
|
|
|
|
Underlying current year
loss ratio
|
|
|
56.5 %
|
58.1 %
|
CAT loss
ratio
|
|
|
2.2 %
|
3.8 %
|
(Favourable)
unfavourable PYD ratio
|
|
|
(5.3) %
|
(5.9) %
|
Claims
ratio
|
|
|
53.4 %
|
56.0 %
|
|
|
|
|
|
|
|
|
Table 4
Reconciliation of the components within Operating net
underwriting expenses
|
|
|
Q1-2023
|
Q1-2022
Restated
|
|
|
|
|
|
Operating net
underwriting expenses, as reported in Table 2
|
|
|
1,652
|
1,567
|
Commissions
|
|
|
801
|
742
|
General
expenses
|
|
|
715
|
688
|
Premium
taxes
|
|
|
136
|
137
|
Operating net
underwriting revenue
|
|
|
4,864
|
4,761
|
Commissions
ratio
|
|
|
16.5 %
|
15.6 %
|
General expenses
ratio
|
|
|
14.7 %
|
14.4 %
|
Premium taxes
ratio
|
|
|
2.8 %
|
2.9 %
|
Expense
ratio
|
|
|
34.0 %
|
32.9 %
|
|
|
|
|
|
|
Table 5
Reconciliation of Operating net investment income to Net
investment income, as reported under IFRS
|
|
|
Q1-2023
|
Q1-2022
Restated
|
|
|
|
|
|
Net
investment income, as reported under IFRS
|
|
|
295
|
207
|
Remove:
investment income from the RSA
Middle-East exited operations
|
|
-
|
(2)
|
Operating net
investment income
|
|
|
295
|
205
|
|
|
|
|
|
|
Table 6
Reconciliation of Net unwind of discount on claims liabilities
to Net insurance financial result, as reported under IFRS
|
|
|
Q1-2023
|
Q1-2022
Restated
|
|
|
|
|
|
Net insurance
financial result, as reported under IFRS
|
|
|
(251)
|
373
|
Remove: Changes in
discount rates and other financial assumptions
|
|
|
92
|
(505)
|
Remove: Net foreign
currency gains (losses)
|
|
|
(44)
|
53
|
Remove: Net insurance
financial result from claims acquired in a business
combination
|
|
(23)
|
(4)
|
Net unwind of
discount on claims liabilities
|
|
|
(226)
|
(83)
|
|
|
|
|
|
|
Table 7
Reconciliation of ROE to Net income attributable to
shareholders, as reported under IFRS
|
Q1-2023
|
Q1-2022
Restated
|
|
|
|
Net income
attributable to shareholders, as reported under
IFRS
|
377
|
499
|
Remove: preferred share
dividends
|
(16)
|
(13)
|
|
|
|
Net income
attributable to common shareholders
|
361
|
486
|
Divided by
weighted-average number of common shares (in millions)
|
175.3
|
176.1
|
EPS, basic and
diluted (in dollars)
|
2.06
|
2.76
|
|
|
|
Net income
attributable to common shareholders for the last 12
months1
|
2,269
|
1,959
|
Adjusted average common
shareholders' equity1
|
14,672
|
13,115
|
ROE for the last 12
months1
|
15.4 %
|
14.9 %
|
1 These
measures are not restated for IFRS 17, given that the 2021 P&L
figures were not restated for IFRS 17
|
Table 8
Reconciliation of consolidated results on a MD&A basis with
the interim condensed consolidated financial
statements
|
MD&A
captions
|
Pre-tax
|
|
|
As presented in the
Financial statements
|
Distribution
income
|
Total
finance
costs
|
Other
operating
income
(expense)
|
Operating net
investment result
|
Total
income
taxes
|
Non-
operating
results
|
Underwriting
income (loss)
|
Total F/S
caption
|
For the quarter
ended March 31, 2023
|
|
|
|
|
|
|
|
Insurance service
result
|
36
|
|
(1)
|
|
|
(90)
|
699
|
644
|
Net investment
income
|
|
|
|
295
|
|
-
|
|
295
|
Net gains (losses) on
investment portfolio
|
|
|
|
|
|
149
|
|
149
|
Net insurance
financial result
|
|
|
|
(226)
|
|
(25)
|
-
|
(251)
|
Share of profits from
investments in associates and joint ventures
|
47
|
(4)
|
1
|
|
(10)
|
(4)
|
|
30
|
Other net gains
(losses)
|
|
|
|
|
|
17
|
|
17
|
Other income and
expense
|
22
|
|
(31)
|
|
|
(52)
|
(86)
|
(147)
|
Other finance
costs
|
|
(50)
|
|
|
|
|
|
(50)
|
Acquisition,
integration and restructuring costs
|
|
|
|
|
|
(136)
|
|
(136)
|
Income tax benefit
(expense)
|
|
|
|
|
(174)
|
|
|
(174)
|
|
|
|
|
|
|
|
|
|
Total, as reported
in MD&A
|
105
|
(54)
|
(31)
|
69
|
(184)
|
(141)
|
613
|
|
For the quarter
ended March 31, 2022 (Restated)
|
|
|
|
|
|
|
|
Insurance service
result
|
20
|
|
2
|
|
|
(53)
|
601
|
570
|
Net investment
income
|
|
|
|
205
|
|
2
|
|
207
|
Net gains (losses) on
investment portfolio
|
|
|
|
|
|
(221)
|
|
(221)
|
Net insurance
financial result
|
|
|
|
(83)
|
|
417
|
39
|
373
|
Share of profits from
investments in associates and joint ventures
|
38
|
(1)
|
1
|
|
(8)
|
(5)
|
|
25
|
Other net gains
(losses)
|
|
|
|
|
|
(20)
|
|
(20)
|
Other income and
expense
|
34
|
|
(39)
|
|
|
(58)
|
(109)
|
(172)
|
Other finance
costs
|
|
(41)
|
|
|
|
|
|
(41)
|
Acquisition,
integration and restructuring costs
|
|
|
|
|
|
(64)
|
|
(64)
|
Income tax benefit
(expense)
|
|
|
|
|
(170)
|
|
|
(170)
|
|
|
|
|
|
|
|
|
|
Total, as reported
in MD&A
|
92
|
(42)
|
(36)
|
122
|
(178)
|
(2)
|
531
|
|
|
|
|
|
|
|
|
|
|
|
Table 9
Calculation of BVPS and BVPS (excluding AOCI)
As at March
31,
|
2023
|
2022
Restated
|
|
|
|
Equity attributable to
shareholders, as reported under
IFRS
|
15,241
|
16,245
|
Remove: Preferred
shares and other equity, as reported under IFRS
|
(1,619)
|
(1,322)
|
|
|
|
Common shareholders'
equity
|
13,622
|
14,923
|
Remove: AOCI, as
reported under IFRS
|
484
|
70
|
|
|
|
Common shareholders'
equity (excluding AOCI)
|
14,106
|
14,993
|
|
|
|
Number of common shares
outstanding at the same date (in
millions)
|
175.3
|
176.0
|
BVPS
|
77.72
|
84.78
|
BVPS (excluding
AOCI)1
|
80.49
|
85.18
|
1 The
Company adopted IFRS 9 retrospectively on January 1, 2023 and
elected to recognize any IFRS 9 measurement differences by
adjusting its Consolidated balance sheet on January 1, 2023, as a
result comparative information was not restated. Prior periods
continue to be reported under IAS 39 – Financial instruments:
recognition and measurement ("IAS 39").
|
Table 10 Adjusted average common shareholders'
equity and Adjusted average common shareholders' equity (excluding
AOCI)
As at March
31,
|
2023
|
20221
|
|
|
|
Ending common
shareholders' equity
|
13,622
|
14,465
|
Remove: significant
capital transaction during the period
|
1,195
|
(4,311)
|
Ending common
shareholders' equity, excluding significant capital
transaction
|
14,817
|
10,154
|
Beginning common
shareholders' equity2
|
14,923
|
8,894
|
Average common
shareholders' equity, excluding significant capital
transaction
|
14,870
|
9,524
|
Weighted impact of
significant capital transaction
|
(108)
|
3,591
|
Adjusted average
common shareholders' equity
|
14,672
|
13,115
|
|
|
|
Ending
common shareholders' equity (excluding AOCI)
|
14,106
|
14,534
|
Remove: significant
capital transaction during the period
|
1,195
|
(4,311)
|
Ending common
shareholders' equity, excluding AOCI and significant capital
transaction
|
15,301
|
10,223
|
Beginning common
shareholders' equity, excluding AOCI2
|
14,993
|
8,529
|
Average common
shareholders' equity, excluding AOCI and significant capital
transaction
|
15,147
|
9,375
|
Weighted impact of
significant capital transaction
|
(108)
|
3,591
|
Adjusted average
common shareholders' equity, excluding AOCI
|
15,039
|
12,966
|
1 These
measures are not restated for IFRS 17, given that the 2021 P&L
figures were not restated for IFRS 17.
|
2 Beginning
common shareholders' equity has not been adjusted for the adoption
of IFRS 9 – Financial instruments ("IFRS 9") for purposes of
calculating average common shareholders' equity.
|
Table
11 Reconciliation of Debt outstanding (excluding hybrid
debt) and Total capital to Debt outstanding, Equity attributable to
shareholders and Equity attributable to NCI, as reported under
IFRS
As at
|
March
31
2023
|
Dec. 31
2022
Restated
|
|
|
|
Debt outstanding, as
reported under IFRS
|
4,789
|
4,522
|
Remove: hybrid
subordinated notes
|
(247)
|
(247)
|
|
|
|
Debt outstanding
(excluding hybrid debt)
|
4,542
|
4,275
|
|
|
|
Debt outstanding, as
reported under IFRS
|
4,789
|
4,522
|
Equity attributable to
shareholders, as reported under IFRS
|
15,241
|
15,843
|
Preferred shares from
Equity attributable to non-controlling interests
|
285
|
285
|
Adjusted total
capital
|
20,315
|
20,650
|
|
|
|
Debt outstanding
(excluding hybrid debt)
|
4,542
|
4,275
|
Adjusted total
capital
|
20,315
|
20,650
|
Adjusted
debt-to-total capital ratio
|
22.4 %
|
20.7 %
|
|
|
|
Debt outstanding, as
reported under IFRS
|
4,789
|
4,522
|
Preferred shares
and other equity, as reported under
IFRS
|
1,619
|
1,322
|
Preferred shares from
Equity attributable to non-controlling interests
|
285
|
285
|
Debt outstanding and
preferred shares (including NCI)
|
6,693
|
6,129
|
Adjusted total
capital
|
20,315
|
20,650
|
Total leverage
ratio
|
32.9 %
|
29.7 %
|
Adjusted
debt-to-total capital
ratio
|
22.4 %
|
20.7 %
|
Preferred shares and
hybrids
|
10.5 %
|
9.0 %
|
Forward Looking Statements
Certain statements made in this news release are forward-looking
statements. These statements include, without limitation,
statements relating to the outlook for the property and casualty
insurance industry in Canada, the
U.S. and the UK, the Company's business outlook, the Company's
growth prospects, the ongoing impact of the coronavirus
(COVID-19) pandemic, the acquisition and integration of RSA, and
the realization of the expected strategic, financial and other
benefits of the sale of the Company's 50% stake in RSA Middle East
B.S.C. (c) All such forward-looking statements are made pursuant to
the 'safe harbour' provisions of applicable Canadian securities
laws.
Forward-looking statements, by their very nature, are subject to
inherent risks and uncertainties and are based on several
assumptions, both general and specific, which give rise to the
possibility that actual results or events could differ materially
from our expectations expressed in or implied by such
forward-looking statements as a result of various factors,
including those discussed in the Company's most recently filed
Annual Information Form dated February 7,
2023 and available on SEDAR at www.sedar.com. As a result,
we cannot guarantee that any forward-looking statement will
materialize and we caution you against relying on any of these
forward-looking statements. Except as may be required by Canadian
securities laws, we do not undertake any obligation to update or
revise any forward-looking statements contained in this news
release, whether as a result of new information, future events or
otherwise. Please read the cautionary note at the beginning of the
Q1-2023 MD&A.
SOURCE Intact Financial Corporation