TIPT 8-K
Tiptree Inc. (TIPT)
8-K
2023-05-03
For: 2023-05-03
View Original
Added on
April 04, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): May 3, 2023
(Exact Name of Registrant as Specified in Charter)
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of Principal Executive Offices) | (Zip Code) | ||||||||||||||||
(212 ) 446-1400
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | |||||||||
| Capital Market | |||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. | ||||
On May 3, 2023, Tiptree Inc. (the “Company” or “Tiptree”) issued a press release announcing its results of operations for the quarter ended March 31, 2023. A copy of the press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. | ||||
Included in the press release furnished as Exhibit 99.1 was an announcement that the board of directors of the Company has declared a cash dividend of $0.05 per share to Tiptree’s stockholders, with a record date of May 22, 2023 and a payment date of May 30, 2023.
On May 3, 2023, the Company posted an investor presentation dated May 2023 on the Investor Resources section of www.tiptreeinc.com. The investor presentation is furnished as Exhibit 99.2 to this Form 8-K and incorporated herein by reference. Tiptree’s website is not intended to function as a hyperlink, and the information contained on such website is not a part of this Form 8-K.
The information in Items 2.02 and 7.01 of this Current Report on Form 8-K, including the information contained in Exhibits 99.1 and 99.2, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section. Furthermore, the information in Items 2.02 and 7.01 of this Current Report on Form 8-K, including the information contained in Exhibits 99.1 and 99.2, shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
| Item 9.01 | Financial Statements and Exhibits. | ||||
(d) List of Exhibits:
| 99.1 | Tiptree Inc. press release, dated May 3, 2023 | ||||
| 99.2 | Tiptree Inc. Investor Presentation - May 2023 | ||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL). | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| TIPTREE INC. | |||||||||||
| Date: | May 3, 2023 | By: | /s/ Jonathan Ilany | ||||||||
| Name: Jonathan Ilany | |||||||||||
| Title: Chief Executive Officer | |||||||||||
Exhibit 99.1
TIPTREE REPORTS FIRST QUARTER 2023 RESULTS
Greenwich, Connecticut - May 3, 2023 - Tiptree Inc. (NASDAQ:TIPT) (“Tiptree” or the “Company”), today announced its financial results for the three months ended March 31, 2023.
| First Quarter | ||||||||||||||
| ($ in thousands, except per share information) | 2023 | 2022 | ||||||||||||
| Total revenues | $ | 381,625 | $ | 324,903 | ||||||||||
| Net income (loss) attributable to common stockholders | $ | (1,062) | $ | (960) | ||||||||||
| Diluted earnings per share | $ | (0.03) | $ | (0.03) | ||||||||||
| Cash dividends paid per common share | $ | 0.05 | $ | 0.04 | ||||||||||
| Return on average equity | (1.1) | % | (0.9) | % | ||||||||||
Non-GAAP: (1) | ||||||||||||||
Adjusted net income | $ | 17,284 | $ | 15,452 | ||||||||||
| Adjusted return on average equity | 12.9 | % | 15.8 | % | ||||||||||
| Book value per share | $ | 10.91 | $ | 10.51 | ||||||||||
(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures. Adjusted net income is presented before the impacts of non-controlling interests.
First Quarter 2023 Summary
•Revenues for the quarter of $381.6 million, an increase of 17.5% from Q1'22, driven by growth in Fortegra’s specialty insurance lines. Excluding investment gains and losses, revenues were up 16.1%.
•Net loss of $1.1 million compared to net loss of $1.0 million in Q1'22, driven by growth in our insurance business, offset by declines in our mortgage and shipping revenues.
•Adjusted net income of $17.3 million increased by 11.9% from $15.5 million in Q1'22, driven by improvement in our insurance operations. Adjusted return on average equity was 12.9% for the quarter, with the year-over-year comparison impacted by the investment in Fortegra in June 2022 from Warburg Pincus.
•Declared a dividend of $0.05 per share to stockholders of record on May 22, 2023 with a payment date of May 30, 2023.
Segment Financial Highlights - First Quarter 2023
Insurance (The Fortegra Group):
| First Quarter | ||||||||||||||
| ($ in thousands) | 2023 | 2022 | ||||||||||||
| Gross written premiums and premium equivalents | $ | 750,329 | $ | 600,855 | ||||||||||
| Revenues | $ | 368,444 | $ | 282,529 | ||||||||||
| Income before taxes | $ | 19,445 | $ | 14,682 | ||||||||||
| Return on average equity | 16.7 | % | 14.7 | % | ||||||||||
| Combined ratio | 91.3 | % | 90.5 | % | ||||||||||
Non-GAAP: (1) | ||||||||||||||
| Adjusted net income | $ | 22,939 | $ | 21,124 | ||||||||||
| Adjusted return on average equity | 26.1 | % | 28.2 | % | ||||||||||
(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures. Adjusted net income is presented before the impacts of non-controlling interests.
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•Gross written premiums and premium equivalents of $750.3 million, increased 24.9% for the quarter driven by growth in U.S. specialty insurance lines and services businesses in U.S. and Europe.
•Unearned premiums and deferred revenues grew to $2.1 billion, up $319.6 million, or 18.3%, from Q1’22.
•Revenues increased 30.4% for the quarter driven by premium growth in specialty E&S and admitted lines, and services businesses in the U.S. and Europe. Excluding the impact of investment gains and losses, revenues increased by 29.0% from Q1’22.
•The combined ratio for the quarter was 91.3%, compared to 90.5% in Q1'22, driven by consistent underwriting performance and the scalability of Fortegra’s operating platform.
•Income before taxes for the quarter was $19.4 million, up $4.8 million. Return on equity of 16.7%, compared to 14.7% in Q1'22.The increases were driven by growth in underwriting and fee revenues and increased net investment income.
•Adjusted net income for the quarter was $22.9 million, up 8.6% from Q1'22 with the improvement driven by revenue growth. Adjusted return on average equity was 26.1%, compared to 28.2% in Q1’22.
•In February 2023, Fortegra acquired Premia Solutions Limited, one of the largest providers of automotive protection products in the United Kingdom, for net cash consideration of approximately $22.5 million.
Tiptree Capital:
| First Quarter | ||||||||||||||
| ($ in thousands) | 2023 | 2022 | ||||||||||||
| Revenues | $ | 13,181 | $ | 42,374 | ||||||||||
| Income before taxes | $ | (1,123) | $ | (3,385) | ||||||||||
| Return on average equity | (1.8) | % | (5.8) | % | ||||||||||
Non-GAAP: (1) | ||||||||||||||
| Adjusted net income | $ | 560 | $ | 972 | ||||||||||
| Adjusted return on average equity | 1.3 | % | 2.2 | % | ||||||||||
(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures. Adjusted net income is presented before the impacts of non-controlling interests.
•Tiptree Capital loss before taxes was $1.1 million compared to loss of $3.4 million in Q1’22, driven by a reduction in unrealized investment losses, partially offset by declines in mortgage operations and the sale of five vessels in 2022.
•Mortgage loss before taxes was $2.6 million, as compared to income of $4.3 million in Q1'22, with the decrease driven by declines in origination volumes and negative marks on the MSR asset in 2023 compared to positive marks in 2022.
•Total Tiptree Capital book value, including corporate net assets, was $220.5 million as of Q1’23.
Corporate:
Corporate includes expenses of the holding company for interest expense, employee compensation and benefits, audit and professional fees, and public company and other expenses. For the quarter, corporate expenses were $10.1 million compared to $12.2 million in Q1'22. The decrease was driven by lower interest expense as we repaid our corporate holding company borrowings in June 2022.
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Non-GAAP
Management uses Adjusted net income and Adjusted return on average equity as measurements of operating performance. Management believes these measures provide supplemental information useful to investors as they are frequently used by the financial community to analyze financial performance and comparison among companies. Management uses Adjusted net income and adjusted return on average equity as part of its capital allocation process and to assess comparative returns on invested capital. Adjusted net income represents income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, stock-based compensation, net realized and unrealized gains (losses), and intangibles amortization associated with purchase accounting. Adjusted net income and Adjusted return on average equity are presented before the impacts of non-controlling interests. Adjusted net income and Adjusted return on average equity are not measurements of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for GAAP net income. See “Non-GAAP Reconciliations” for a reconciliation of these measures to their GAAP equivalents.
Earnings Conference Call
Tiptree will host a conference call on Thursday, May 4, 2023 at 9:00 a.m. Eastern Time to discuss its Q1 2023 financial results. A copy of our investor presentation, to be used during the conference call, as well as this press release, will be available in the Investor Relations section of the Company’s website, located at www.tiptreeinc.com.
The conference call will be available via live or archived webcast at http://www.investors.tiptreeinc.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software. To participate in the telephone conference call, please dial 1-877-407-4018 (domestic) or 1-201-689-8471 (international). Please dial in at least five minutes prior to the start time.
A replay of the call will be available from Thursday, May 4, 2023 at 12:00 p.m. Eastern Time, until midnight Eastern on Thursday, May 11, 2023. To listen to the replay, please dial 1-844-512-2921 (domestic) or 1-412-317-6671 (international), Passcode: 13737264.
About Tiptree
Tiptree Inc. (NASDAQ: TIPT) allocates capital to select small and middle market companies with the mission of building long-term value. Established in 2007, we have a significant track record investing in the insurance sector and across a variety of other industries, including mortgage origination, specialty finance and shipping. With proprietary access and a flexible capital base, we seek to uncover compelling investment opportunities and support management teams in unlocking the full value potential of their businesses. For more information, please visit tiptreeinc.com and follow us on LinkedIn.
Forward-Looking Statements
This release contains “forward-looking statements” which involve risks, uncertainties and contingencies, many of which are beyond the Company’s control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “should,” “target,” “will,” or similar expressions are intended to identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements about the Company’s plans, objectives, expectations for our businesses and intentions. The forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, many of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecast in the forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to those described in the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K, and as described in the Company’s other filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date of this release. The factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could affect our forward-looking statements. Consequently, our actual performance could be materially different from the results described or anticipated by our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by the federal securities laws, we undertake no obligation to update any forward-looking statements.
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Tiptree Inc.
Condensed Consolidated Balance Sheets
($ in thousands, except share data)
| As of | |||||||||||
| March 31, 2023 | December 31, 2022 | ||||||||||
| Assets: | |||||||||||
| Investments: | |||||||||||
| Available for sale securities, at fair value, net of allowance for credit losses | $ | 810,445 | $ | 611,980 | |||||||
| Loans, at fair value | 72,382 | 64,843 | |||||||||
| Equity securities | 111,089 | 85,776 | |||||||||
| Other investments | 84,570 | 73,025 | |||||||||
| Total investments | 1,078,486 | 835,624 | |||||||||
| Cash and cash equivalents | 412,004 | 538,065 | |||||||||
| Restricted cash | 13,926 | 12,782 | |||||||||
| Notes and accounts receivable, net | 502,615 | 502,311 | |||||||||
| Reinsurance receivables | 1,297,440 | 1,176,090 | |||||||||
| Deferred acquisition costs | 504,336 | 498,925 | |||||||||
| Goodwill | 206,636 | 186,608 | |||||||||
| Intangible assets, net | 130,609 | 117,015 | |||||||||
| Other assets | 161,906 | 172,143 | |||||||||
| Total assets | $ | 4,307,958 | $ | 4,039,563 | |||||||
| Liabilities and Stockholders’ Equity | |||||||||||
| Liabilities: | |||||||||||
| Debt, net | $ | 347,461 | $ | 259,366 | |||||||
| Unearned premiums | 1,403,213 | 1,357,436 | |||||||||
| Policy liabilities and unpaid claims | 639,808 | 567,193 | |||||||||
| Deferred revenue | 665,513 | 649,150 | |||||||||
| Reinsurance payable | 345,139 | 305,097 | |||||||||
| Other liabilities and accrued expenses | 365,267 | 367,748 | |||||||||
| Total liabilities | $ | 3,766,401 | $ | 3,505,990 | |||||||
| Stockholders’ Equity: | |||||||||||
| Preferred stock: $0.001 par value, 100,000,000 shares authorized, none issued or outstanding | $ | — | $ | — | |||||||
| Common stock: $0.001 par value, 200,000,000 shares authorized, 36,734,948 and 36,385,299 shares issued and outstanding, respectively | 37 | 36 | |||||||||
| Additional paid-in capital | 382,502 | 382,645 | |||||||||
| Accumulated other comprehensive income (loss), net of tax | (33,093) | (39,429) | |||||||||
| Retained earnings | 51,201 | 54,113 | |||||||||
| Total Tiptree Inc. stockholders’ equity | 400,647 | 397,365 | |||||||||
| Non-controlling interests: | |||||||||||
| Fortegra preferred interests | 77,679 | 77,679 | |||||||||
| Common interests | 63,231 | 58,529 | |||||||||
| Total non-controlling interests | 140,910 | 136,208 | |||||||||
| Total stockholders’ equity | 541,557 | 533,573 | |||||||||
| Total liabilities and stockholders’ equity | $ | 4,307,958 | $ | 4,039,563 | |||||||
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Tiptree Inc.
Condensed Consolidated Statements of Operations
($ in thousands, except share data)
| Three Months Ended March 31, | |||||||||||
| 2023 | 2022 | ||||||||||
| Revenues: | |||||||||||
| Earned premiums, net | $ | 265,330 | $ | 208,416 | |||||||
| Service and administrative fees | 92,032 | 71,835 | |||||||||
| Ceding commissions | 3,645 | 2,537 | |||||||||
| Net investment income | 5,109 | 3,167 | |||||||||
| Net realized and unrealized gains (losses) | 2,177 | 17,204 | |||||||||
| Other revenue | 13,332 | 21,744 | |||||||||
| Total revenues | 381,625 | 324,903 | |||||||||
| Expenses: | |||||||||||
| Policy and contract benefits | 141,675 | 104,446 | |||||||||
| Commission expense | 146,450 | 117,423 | |||||||||
| Employee compensation and benefits | 40,798 | 56,455 | |||||||||
| Interest expense | 6,465 | 10,199 | |||||||||
| Depreciation and amortization | 5,253 | 6,156 | |||||||||
| Other expenses | 32,811 | 31,176 | |||||||||
| Total expenses | 373,452 | 325,855 | |||||||||
| Income (loss) before taxes | 8,173 | (952) | |||||||||
| Less: provision (benefit) for income taxes | 5,022 | (86) | |||||||||
| Net income (loss) | 3,151 | (866) | |||||||||
| Less: net income (loss) attributable to non-controlling interests | 4,213 | 94 | |||||||||
| Net income (loss) attributable to common stockholders | $ | (1,062) | $ | (960) | |||||||
| Net income (loss) per common share: | |||||||||||
| Basic earnings per share | $ | (0.03) | $ | (0.03) | |||||||
| Diluted earnings per share | $ | (0.03) | $ | (0.03) | |||||||
| Weighted average number of common shares: | |||||||||||
| Basic | 36,522,946 | 34,229,011 | |||||||||
| Diluted | 36,522,946 | 34,229,011 | |||||||||
| Dividends declared per common share | $ | 0.05 | $ | 0.04 | |||||||
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Tiptree Inc.
Non-GAAP Reconciliations (Unaudited)
Non-GAAP Financial Measures — Adjusted net income and Adjusted return on average equity
The Company defines Adjusted net income as income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, including merger and acquisition related expenses, stock-based compensation, net realized and unrealized gains (losses) and intangibles amortization associated with purchase accounting. We use adjusted net income as an internal operating performance measure in the management of business as part of our capital allocation process. We believe adjusted net income provides useful supplemental information to investors as it is frequently used by the financial community to analyze financial performance between periods and for comparison among companies. Adjusted net income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define adjusted net income differently. Adjusted net income is presented before the impacts of non-controlling interests.
We define Adjusted return on average equity as Adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholder’s equity during the period. We use Adjusted return on average equity as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted return on average equity should not be viewed as a substitute for return on average equity calculated in accordance with GAAP, and other companies may define adjusted return on average equity differently.
| Three Months Ended March 31, 2023 | |||||||||||||||||||||||||||||
| Tiptree Capital | |||||||||||||||||||||||||||||
| ($ in thousands) | Insurance | Mortgage | Other | Corporate | Total | ||||||||||||||||||||||||
| Income (loss) before taxes | 19,445 | (2,565) | 1,442 | (10,149) | $ | 8,173 | |||||||||||||||||||||||
| Less: Income tax (benefit) expense | (4,747) | 613 | (263) | (625) | (5,022) | ||||||||||||||||||||||||
| Less: Net realized and unrealized gains (losses) | 4,607 | 1,443 | 323 | — | 6,373 | ||||||||||||||||||||||||
Plus: Intangibles amortization (1) | 3,894 | — | — | — | 3,894 | ||||||||||||||||||||||||
| Plus: Stock-based compensation expense | 33 | — | — | 2,282 | 2,315 | ||||||||||||||||||||||||
| Plus: Non-recurring expenses | 2,125 | — | — | — | 2,125 | ||||||||||||||||||||||||
| Plus: Non-cash fair value adjustments | (118) | — | — | — | (118) | ||||||||||||||||||||||||
Less: Tax on adjustments (2) | (2,300) | (344) | (89) | 2,277 | (456) | ||||||||||||||||||||||||
| Adjusted net income | $ | 22,939 | $ | (853) | $ | 1,413 | $ | (6,215) | $ | 17,284 | |||||||||||||||||||
| Adjusted net income | $ | 22,939 | $ | (853) | $ | 1,413 | $ | (6,215) | 17,284 | ||||||||||||||||||||
| Average stockholders’ equity | $ | 351,953 | $ | 53,768 | $ | 114,219 | $ | 17,626 | 537,566 | ||||||||||||||||||||
| Adjusted return on average equity | 26.1 | % | (6.3) | % | 4.9 | % | NM% | 12.9 | % | ||||||||||||||||||||
| Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||
| Tiptree Capital | |||||||||||||||||||||||||||||
| ($ in thousands) | Insurance | Mortgage | Other | Corporate | Total | ||||||||||||||||||||||||
| Income (loss) before taxes | $ | 14,682 | $ | 4,266 | $ | (7,651) | $ | (12,249) | $ | (952) | |||||||||||||||||||
| Less: Income tax (benefit) expense | (3,664) | (978) | 1,794 | 2,934 | 86 | ||||||||||||||||||||||||
| Less: Net realized and unrealized gains (losses) | 6,643 | (6,314) | 8,851 | — | 9,180 | ||||||||||||||||||||||||
Plus: Intangibles amortization (1) | 3,946 | — | 3,946 | ||||||||||||||||||||||||||
| Plus: Stock-based compensation expense | 2,319 | — | 3,839 | 6,158 | |||||||||||||||||||||||||
| Plus: Non-recurring expenses | 23 | 133 | 156 | ||||||||||||||||||||||||||
| Plus: Non-cash fair value adjustments | 1,514 | 1,514 | |||||||||||||||||||||||||||
Less: Tax on adjustments (2) | (2,825) | 1,470 | (2,113) | (1,168) | (4,636) | ||||||||||||||||||||||||
| Adjusted net income | $ | 21,124 | $ | (1,556) | $ | 2,528 | $ | (6,644) | $ | 15,452 | |||||||||||||||||||
| Adjusted net income | $ | 21,124 | $ | (1,556) | $ | 2,528 | $ | (6,644) | $ | 15,452 | |||||||||||||||||||
| Average stockholders’ equity | $ | 299,113 | $ | 58,962 | $ | 117,744 | $ | (84,152) | $ | 391,667 | |||||||||||||||||||
| Adjusted return on average equity | 28.2 | % | (10.6) | % | 8.6 | % | NM% | 15.8 | % | ||||||||||||||||||||
Page 6
| Notes | |||||
| (1) | Specifically associated with acquisition purchase accounting. See Note (8) Goodwill and Intangible Assets, net, of the Company’s Form 10-Q for the period ended March 31, 2023. | ||||
| (2) | Tax on adjustments represents the tax applied to the total non-GAAP adjustments and includes adjustments for non-recurring or discrete tax impacts. For the three months ended March 31, 2023, included in the adjustment is an add-back of $2.3 million related to deferred tax expense from the WP Transaction. | ||||
Non-GAAP Financial Measures — Book value per share
Management believes the use of this financial measure provides supplemental information useful to investors as book value is frequently used by the financial community to analyze company growth on a relative per share basis. The following table provides a reconciliation between total stockholders’ equity and total shares outstanding, net of treasury shares.
($ in thousands, except per share information) | As of March 31, | ||||||||||
| 2023 | 2022 | ||||||||||
| Total stockholders’ equity | $ | 541,557 | $ | 383,153 | |||||||
| Less: Non-controlling interests | 140,910 | 16,520 | |||||||||
| Total stockholders’ equity, net of non-controlling interests | $ | 400,647 | $ | 366,633 | |||||||
| Total common shares outstanding | 36,735 | 34,878 | |||||||||
| Book value per share | $ | 10.91 | $ | 10.51 | |||||||
Page 7
Investor Presentation – First Quarter 2023 May 2023 Financial Information for the three months ended March 31, 2023 EXHIBIT 99.2
1 Disclaimers LIMITATIONS ON THE USE OF INFORMATION This presentation has been prepared by Tiptree Inc. and its consolidated subsidiaries (“Tiptree", "the Company" or "we”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree, its subsidiaries or any of its affiliates or any other purpose. Tiptree reports a non-controlling interest in certain operating subsidiaries that are not wholly owned. Unless otherwise noted, all information is of Tiptree on a consolidated basis before non-controlling interest. Neither Tiptree nor any of its affiliates makes any representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein and no such party shall have any liability for such information. These materials and any related oral statements are not all-inclusive and shall not be construed as legal, tax, investment or any other advice. You should consult your own counsel, accountant or business advisors. Performance information is historical and is not indicative of, nor does it guarantee future results. There can be no assurance that similar performance may be experienced in the future. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This document contains "forward-looking statements" which involve risks, uncertainties and contingencies, many of which are beyond Tiptree's control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. All statements contained herein that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "estimate," "expect,“ “intend,” “may,” “might,” "plan," “project,” “should,” "target,“ “will,” "view," “confident,” or similar expressions are intended to identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements about Tiptree's plans, objectives, expectations and intentions. The forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, many of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecast in the forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to those described in the section entitled “Risk Factors” in Tiptree’s Annual Report on Form 10-K, and as described in the Tiptree’s other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date of this release. The factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could affect our forward-looking statements. Consequently, our actual performance could be materially different from the results described or anticipated by our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by the federal securities laws, we undertake no obligation to update any forward- looking statements. MARKET AND INDUSTRY DATA Certain market data and industry data used in this presentation were obtained from reports of governmental agencies and industry publications and surveys. We believe the data from third-party sources to be reliable based upon our management’s knowledge of the industry, but have not independently verified such data and as such, make no guarantees as to its accuracy, completeness or timeliness. NOT AN OFFER OR A SOLICIATION This document does not constitute an offer or invitation for the sale or purchase of securities or to engage in any other transaction with Tiptree, its subsidiaries or its affiliates. The information in this document is not targeted at the residents of any particular country or jurisdiction and is not intended for distribution to, or use by, any person in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. NON-GAAP MEASURES In this document, we sometimes use financial measures derived from consolidated financial data but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). Certain of these data are considered “non-GAAP financial measures” under the SEC rules. These non-GAAP financial measures supplement our GAAP disclosures and should not be considered an alternative to the GAAP measure. Management's reasons for using these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures are posted in the Appendix.
2 Q1’23 Highlights Revenue $381.6 million 17.5% vs. prior year Adjusted Net Income2 $17.3 million 11.9% vs. prior year Book Value per share2,3 $10.91 5.4% vs. 3/31/22 Net Loss1 $(1.1) million vs. prior year net loss of $(1.0) million Overall Adj. net income2 of $17.3mm, with a 12.9% adj. ROAE2, driven by improvement in insurance operations. Increased the quarterly dividend to $0.05 per share, representing an increase of 25%. Insurance $750mm of gross written premiums and premium equivalents (GWPPE)4, 25% increase from PY driven growth in E&S and admitted insurance lines and fee-based services. Combined ratio of 91.3% driven by consistent underwriting performance and the scalability of Fortegra’s operating platform. Adj. net income of $22.9mm, up 8.6% from PY driven by revenue growth. Adj. ROAE of 26%. In Feb’23, acquired Premia for net cash consideration of ~$22.5mm, further establishing Fortegra's footprint in Europe. Tiptree Capital Pre-tax tax loss of $(1.1)mm driven by lower returns from mortgage & the sale of five vessels in our shipping business. Total book value ended quarter at $220.5mm (including corporate net assets). ($ in millions, except per share information) 1 Net income (loss) attributable to common stockholders. 2 For a reconciliation of Non-GAAP metrics Adjusted net income, adjusted return on average equity and book value per share to GAAP financials, see the Appendix. 3 Year-over-year total return defined as cumulative dividends paid of $0.17 per share plus book value per share as of March 31, 2023. 4 Gross written premium and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership.
Financial Results Q1’22 Q1'23 Total Revenues $324.9 $381.6 Net income (loss) $(1.0) $(1.1) Diluted EPS $(0.03) $(0.03) Adjusted net income1 $15.5 $17.3 Adjusted ROAE1 15.8% 12.9% Total shares outstanding 34.9 36.7 Book Value per share1 $10.51 $10.91 3 1 For a reconciliation of Non-GAAP metrics Adjusted net income, adjusted return on average equity and book value per share to GAAP financials, see the Appendix. ($ in millions, except per share information) $12.8 $21.1 $22.9 $8.0 $1.0 $0.6 $(7.7) $(6.6) $(6.2) $13.2 $15.5 $17.3 Q1'21 Q1'22 Q1'23 Corporate Fortegra Tiptree Capital Key Highlights – Q1’23 Adjusted Net Income by business Revenues up 16%, excluding the impact of investment gains/losses • Growth in Fortegra’s earned premiums, service fees and investment income • Mortgage origination volumes down 43%, results impacted by MSR marks of $(1.4)mm in Q1’23 •Net loss of $(1.1)mm • Improvement in insurance operations more than offset by lower mortgage revenue and sale of vessels Adj net income of $17.3mm, increased by 11.9% versus prior year • Continued revenue growth and consistent combined ratio at Fortegra • Adj. ROAE% year-over-year impacted by the investment in Fortegra in Jun’22 BVPS of $10.91 increased by 5.4% over PY, up 0.3% from Q4 (incl. dividends) • Closing of the Warburg investment (Q2’22) resulted in $63.2mm pre-tax increase to equity, offset by $44.1mm of tax impact related to the tax deconsolidation of Fortegra • Q1’23 Unrealized gains on fixed income investments of $6.3mm (after tax & NCI)
Specialty Insurance Performance Highlights Q1’23
5 Fortegra – Financial Performance Highlights Product & distribution expansion driving continued growth, while maintaining underwriting discipline • GWPPE of $750mm, or 25% growth driven by E&S and warranty lines • Unearned premiums and deferred revenue grew to $2.1Bn, a 18% increase year-over-year • Underwriting & fee revenues increased to $368mm, up 29% from PY Produced stable, growing results from underwriting and fees • Underwriting margin of $80mm, up 24%, driven by growth in E&S and admitted lines • Stable combined ratio of 91.3% • Adj. ROAE of 26.1%, driven by insurance and fee-based services Capital and liquidity remain strong and continue to support growth objectives Underwriting and Fee Margin1 Underwriting and Fee Revenues1 Combined Ratio 1 2 3 Summary Financials Insurance products Q1’23 Highlights & Outlook 40 49 19 265 5 $64 $80 Q1'22 Q1'23 211 274 61 79 14 15 $286 $368 Q1'22 Q1'23 77.6% 78.3% 12.9% 13.0% 90.5% 91.3% Q1'22 Q1'23 ($ in millions) U.S. Warranty Solutions U.S Insurance Europe Expense Ratio Underwriting Ratio Europe U.S. Warranty Solutions U.S. Insurance 1 Gross written premiums and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership. 2 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income, Adjusted return on average equity, underwriting and fee revenues and underwriting and fee margin. Q1’22 Q1’23 V% Premiums & equivalents1 $600.9 $750.0 24.9% Revenue $282.5 $368.4 30.4% Pre-tax income $14.7 $19.4 32.4% Adjusted net income2 $21.1 $22.9 8.6% Adjusted ROAE2 28.2% 26.1% (2.1)% Combined ratio 90.5% 91.3% 80bps Unearned Premiums & Deferred Revenues $1,749.1 $2,068.7 18.3%
Robust growth trajectory while maintaining underwriting profitability 78.1% 75.7% 74.2% 77.6% 78.3% 15.9% 17.9% 17.3% 12.9% 13.0% 94.0% 93.6% 91.5% 90.5% 91.3% Q1'19 Q1'20 Q1'21 Q1'22 Q1'23 $6.5 $8.7 $12.8 $21.1 $22.9 Q1'19 Q1'20 Q1'21 Q1'22 Q1'23 6 ($ in millions) Gross Written Premiums & Equivalents1 Underwriting & Fee Revenues and Margin2 Adjusted Net Income2 191 246 336 407 503 56 133 125 163 212 3 13 16 31 35 $250 $392 $477 $601 $750 Q1'19 Q1'20 Q1'21 Q1'22 Q1'23 Combined Ratio Adj. ROAE%1 Adj. Net Income U/W Ratio Expense Ratio U.S. Insurance U.S. Warranty Solutions Europe 1 Gross written premiums and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership. 2 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income, Adjusted return on average equity, underwriting and fee revenues and underwriting and fee margin. 10% 18% U/W & Fee Revenues U/W & Fee Margin 26%13% 23 26 30 40 49 9 14 21 19 26 0 2 3 5 5 $33 $42 $54 $64 $80 Q1'19 Q1'20 Q1'21 Q1'22 Q1'23 28% 126 131 150 211 27421 38 51 61 79 1 5 9 14 15 $148 $174 $210 $286 $368 Q1'19 Q1'20 Q1'21 Q1'22 Q1'23
Insurance Investment Portfolio Cash & Equivalents 27% Government & Agency 41% Corporate Bonds 13% Fixed Income ETFs 5% Muni & ABS 5% Equities 2% Other Alternatives 7% Cash & Equivalents 30% Government & Agency 45% AA 4% A 13% BBB 3% Fixed Income ETFs 5% $1,157mm 7 Q1’23 Investment Mix Liquid and Highly-Rated Fixed Income Portfolio ($ in millions) 767 1,157 125 110 $892 $1,267 Q1'22 Q1'23 Other investments Fixed Income & Cash Return Metrics (Pre-tax) $1,267mm ◼ ~2.1 year duration ◼ AA rating Q1’22 Q1’23 Net investment income – P&L $3.2) $5.1 Net realized and unrealized gains (losses) – P&L $(6.6) $(4.6) Unrealized gains (losses) on AFS Securities – OCI $(26.3) $12.4 3.0%1.2%Book yield
Fortegra Summary & Outlook 8 ($ in millions) LTM Adjusted Net Income1 1) See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income and Adjusted ROAE. Adjusted net income is presented before the impacts of non-controlling interests. Q1’23 LTM Highlights $75.1 $85.6 Q1'22 Q1'23 ✓ Record top-line premiums – $2.8Bn ✓ Record Adjusted Net Income – $85.6mm Outlook LTM Adjusted ROAE %1 17.5% 17.8% 8.9% 8.1% 26.4% 26.0% Q1'22 Q1'23 • Expect continued growth and consistency of underwriting • Continued investment in strategic growth areas ✓ Specialty E&S lines ✓ Capital-light services ✓ European expansion Lift from Warranty Solutions Insurance
Performance Highlights Q1’23
83.1 20.5 57.5 52.8 20.2 32.7 10.3 100.4 $171.1 $206.4 Q1'22 Q1'23 Financial drivers Pre-tax income Adj. Net Income1 Q1’22 Q1’23 Q1’22 Q1’23 Mortgage $4.3 $(2.6) $(1.6) $(0.9) Senior living (Invesque)2 (8.8) (1.4) - - Maritime transportation 2.7 0.2 2.5 0.2 Other (1.6) 2.7 - 1.3 Total $(3.4) $(1.1) $1.0 $0.6 10 Tiptree Capital – Financial Performance Highlights Mortgage: • Mortgage origination volumes of $203mm, down 43% from PY • Pre-tax income below PY from volume decline and negative FV on MSR asset; gain on sale margins improved by 50 bps to 4.8% • MSR asset of $40mm, including negative MTM of $1.4mm in Q1’23 Cash & U.S Government Securities: • Invested in U.S Gov’t and money market funds Equities: • Q1’23 unrealized losses of $0.3mm, compared to PY loss of $8.8m Maritime transportation: • Favorable valuations led to strategic sales of all five vessels in 2022 Mortgage Maritime transportation Equity Securities2 1 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income. 2 Includes 14.0m of Invesque common shares representing $11.4 million of balance sheet fair value as of March 31, 2023. Equity Capital Allocation Q1’23 Highlights ($ in millions) Cash and U.S. Government Securities
01 Summary & Outlook
Financial Snapshot 12 ($ in millions) Adjusted Net Income1 1) See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income. Adjusted net income is presented before the impacts of non-controlling interests. 2) Estimated based on Warburg Pincus valuation multiple of 13.5x Adj. Net Income, multiplied by Q1’23 LTM Adj. Net Income of $85.6 million, multiplied by Tiptree’s 72.4% as converted ownership as of Q1’23 less deferred tax liability of $44.1 million recorded as of Q1’23. 3) Includes Tiptree Inc. stockholders’ equity of Mortgage, Tiptree Capital – Other and Corporate, excluding the deferred tax liability relating to Tiptree’s investment in Fortegra. 4) Diluted shares as of March 21, 2023, represents basic outstanding shares of 36,734,948 plus dilutive shares of 1,220,569 which includes unvested RSUs, outstanding options (assumed to be exercised cashless) and certain exchangeable subsidiary awards. Adj ROAE% 17.0% 14.1% Sum of the Parts $66.2 $65.2 LTM Q1'22 LTM Q1'23 $792 million2 (Transaction multiple) $221 million3 (Book value ex. NCI) $1,013 million $20.88 Value/TIPT diluted share4 Pro-forma SOTP Value $5.82 $26.70
13 • Significant opportunities to achieve value creation objectives at Fortegra • Capital available to redeploy into long-term value creating opportunities Summary & Outlook ($ in millions) ✓ Strong operating performance from our businesses – Fortegra continues to deliver strong top-line growth and return on equity – Increasing yields on investment portfolio – Mortgage business maintaining break- even levels 1 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income and Adjusted return on average equity. Q1’23 LTM Highlights Looking Ahead
Appendix Non-GAAP Reconciliations • Insurance underwriting and fee revenue • Insurance underwriting and fee margin • Book Value per share • Adjusted net income
Non-GAAP Reconciliations 15 Adjusted Net Income We define adjusted net income as income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, including merger and acquisition related expenses, stock-based compensation, net realized and unrealized gains (losses) and intangibles amortization associated with purchase accounting. We use adjusted net income as an internal operating performance measure in the management of business as part of our capital allocation process. We believe adjusted net income provides useful supplemental information to investors as it is frequently used by the financial community to analyze financial performance between periods and for comparison among companies. Adjusted net income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define adjusted net income differently. We present adjustments for amortization associated with acquired intangible assets. The intangible assets were recorded as part of purchase accounting in connection with Tiptree’s acquisition of FFC in 2014, Defend in 2019, and Smart AutoCare and Sky Auto in 2020. The intangible assets acquired contribute to overall revenue generation, and the respective purchase accounting adjustments will continue to occur in future periods until such intangible assets are fully amortized in accordance with the respective amortization periods required by GAAP. We define adjusted return on average equity as adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholder’s equity during the period. We use adjusted return on average equity as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted return on average equity should not be viewed as a substitute for return on average equity calculated in accordance with GAAP, and other companies may define adjusted return on average equity differently. Book value per share Management believes the use of book value per share provides supplemental information useful to investors as it is frequently used by the financial community to analyze company growth on a relative per share basis. Insurance – Underwriting and Fee Revenues We generally manage our exposure to the underwriting risk we assume using both reinsurance (e.g., quota share and excess of loss) and retrospective commission agreements with our partners (e.g., commissions paid are adjusted based on the actual underlying losses incurred), which mitigate our risk. Period-over-period comparisons of revenues and expenses are often impacted by the PORCs and distribution partners’ choice as to whether to retain risk, specifically service and administration fees and ceding commissions, both components of revenue, and policy and contract benefits and commissions paid to our partners and reinsurers. Generally, when losses are incurred, the risk which is retained by our partners and reinsurers is reflected in a reduction in commissions paid. In order to better explain to investors the underwriting performance of the Company’s programs and the respective retentions between the Company and its agents and reinsurance partners, we use the non-GAAP metrics underwriting and fee revenues and underwriting and fee margin. We define underwriting and fee revenues as total revenues from our Insurance segment excluding net investment income, net realized and unrealized gains (losses). Underwriting and fee revenues represents revenues generated by our underwriting and fee-based operations and allows us to evaluate our underwriting performance without regard to investment income. We use this metric as we believe it gives our management and other users of our financial information useful insight into our underlying business performance. Underwriting and fee revenues should not be viewed as a substitute for total revenues calculated in accordance with GAAP, and other companies may define underwriting and fee revenues differently. Insurance - Underwriting and Fee Margin We define underwriting and fee margin as income before taxes from our Insurance segment, excluding net investment income, net realized and unrealized gains (losses), employee compensation and benefits, other expenses, interest expense and depreciation and amortization. Underwriting and fee margin represents the underwriting performance of our underwriting and fee-based programs. As such, underwriting and fee margin excludes general administrative expenses, interest expense, depreciation and amortization and other corporate expenses as those expenses support the vertically integrated business model and not any individual component of our business mix. We use this metric as we believe it gives our management and other users of our financial information useful insight into the specific performance of our underlying underwriting and fee program. Underwriting and fee income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define underwriting and fee margin differently.
16 Non-GAAP Reconciliations – UW & Fee Revenues & Margin, BVPS ($ in thousands, except per share information) 2023 2022 2021 2020 2019 Total revenues 368,444$ 282,529$ 222,563$ $ 143,340 $ 153,242 Less: Net investment income (5,109) (3,167) (2,767) (3,488) (2,911) Less: Net realized and unrealized gains (losses) 4,607 6,643 (9,672) 33,601 (2,114) Underwriting and fee revenues 367,942$ 286,005$ 210,124$ 173,453$ 148,217$ 2023 2022 2021 2020 2019 Income (loss) before income taxes 19,445$ $ 14,682 $ 21,528 $ (27,117) $ 6,202 Less: Net investment income (5,109) (3,167) (2,767) (3,488) (2,911) Less: Net realized and unrealized gains (losses) 4,607 6,643 (9,672) 33,601 (2,114) Plus: Depreciation and amortization 4,811 4,354 4,191 2,270 2,259 Plus: Interest expense 6,081 4,759 4,304 3,648 4,145 Plus: Employee compensation and benefits 24,613 22,026 19,089 17,042 12,001 Plus: Other expenses 25,369 14,839 17,632 16,220 12,891 Underwriting and fee margin 79,817$ 64,136$ 54,305$ 42,176$ 32,473$ 2023 2022 Total stockholders’ equity 541,557$ 383,153$ Less: Non-controlling interests (140,910) (16,520) Total stockholders’ equity, net of non-controlling interests 400,647$ 366,633$ Total common shares outstanding 36,735 34,878 Book value per share 10.91$ 10.51$ Three Months Ended March 31, Three Months Ended March 31, Three Months Ended March 31,
17 Non-GAAP Reconciliations – Q1’23 Adjusted Net Income The footnotes below correspond to the tables above, under “— Adjusted Net Income - Non-GAAP and “—Adjusted Return on Average Equity - Non-GAAP”. Adjusted net income is presented before the impacts of non- controlling interests. Tiptree’s subsidiary ownership percentage as of March 31, 2023 was Fortegra 79.4%, Tiptree Marine 100%, Reliance (Mortgage) 100%. (1) Specifically associated with acquisition purchase accounting. See Note (8) Goodwill and Intangible Assets, net. (2) Tax on adjustments represents the tax applied to the total non-GAAP adjustments and includes adjustments for non- recurring or discrete tax impacts. For the three months ended March 31, 2023, included in the adjustment is an add-back of $2.3 million related to deferred tax expense from the WP Transaction. ($ in thousands) Insurance Mortgage Other Corporate Total Insurance Mortgage Other Corporate Total Insurance Mortgage Other Corporate Total Income (loss) before taxes 19,445$ (2,565)$ 1,442$ (10,149)$ 8,173$ 14,682$ 4,266$ (7,651)$ (12,249)$ (952)$ 21,528$ 13,077$ 14,994$ (10,207)$ 39,392$ Less: Income tax (benefit) expense (4,747) 613 (263) (625) (5,022) (3,664) (978) 1,794 2,934 86 (4,429) (3,096) (2,907) 1,680 (8,752) Less: Net realized and unrealized gains (losses) 4,607 1,443 323 - 6,373 6,643 (6,314) 8,851 - 9,180 (9,624) (3,420) (13,766) - (26,810) Plus: Intangibles amortization (1) 3,894 - - - 3,894 3,946 - - - 3,946 3,834 - - - 3,834 Plus: Stock-based compensation expense 33 - - 2,282 2,315 2,319 - - 3,839 6,158 372 165 8 520 1,065 Plus: Non-recurring expenses 2,125 - - - 2,125 23 - 133 - 156 270 - - - 270 Plus: Non-cash fair value adjustments (118) - - - (118) - - 1,514 - 1,514 - - (657) - (657) Less: Tax on adjustments (2) (2,300) (344) (89) 2,277 (456) (2,825) 1,470 (2,113) (1,168) (4,636) 825 739 2,895 354 4,813 Adjusted net income 22,939$ (853)$ 1,413$ (6,215)$ 17,284$ 21,124$ (1,556)$ 2,528$ (6,644)$ 15,452$ 12,776$ 7,465$ 567$ (7,653)$ 13,155$ Average stockholders’ equity 351,953$ 53,768$ 114,219$ 17,626$ 537,566$ 299,113$ 58,962$ 117,744$ (84,152)$ 391,667$ 285,885$ 65,533$ 113,218$ (79,166)$ 385,470$ Adjusted return on average equity 26.1% (6.3)% 4.9% NM% 12.9% 28.2% (10.6)% 8.6% NM% 15.8% 17.9% 45.6% 2.0% NM% 13.7% Insurance Mortgage Other Corporate Total Insurance Mortgage Other Corporate Total Income (loss) before taxes 72,913$ (5,957)$ 40,495$ (44,316)$ 63,135$ 63,011$ 19,596$ (5,435)$ (52,174)$ 24,998$ Less: Income tax (benefit) expense (22,334) 1,228 (7,602) (26,850) (55,558) (17,673) (2,764) 2,709 5,275 (12,453) Less: Net realized and unrealized gains (losses) 18,311 754 (27,316) - (8,251) 12,535 (8,692) 19,526 - 23,369 Plus: Intangibles amortization (1) 16,177 - - - 16,177 15,441 - - - 15,441 Plus: Stock-based compensation expense 137 - - 5,536 5,673 3,953 166 205 11,900 16,224 Plus: Non-recurring expenses 5,476 - (862) 2,108 6,722 1,911 - 1,071 2,171 5,153 Plus: Non-cash fair value adjustments (1,057) - 2,041 - 984 - - (999) - (999) Less: Tax on adjustments (2) (3,976) 20 5,755 34,551 36,350 (4,048) 107 (4,353) 2,727 (5,567) Adjusted net income 85,647$ (3,955)$ 12,511$ (28,971)$ 65,232$ 75,130$ 8,413$ 12,724$ (30,101)$ 66,166$ Average stockholders’ equity 329,745$ 55,156$ 133,589$ (56,135)$ 462,355$ 284,177$ 64,061$ 117,245$ (75,207)$ 390,276$ Adjusted return on average equity 26.0% (7.2)% 9.4% NM% 14.1% 26.4% 13.1% 10.9% NM% 17.0% For the Three Month Ended March 31, 2022 For the Three Month Ended March 31, 2021 Tiptree CapitalTiptree Capital For the Three Month Ended March 31, 2023 Tiptree Capital For the Trailing Twelve Months Ended March 31, 2023 For the Trailing Twelve Months Ended March 31, 2022 Tiptree Capital Tiptree Capital
