White Mountains Insurance Group (WTM) Investor Day 2024 summary

Strategic highlights and capital deployment

• Achieved 14% growth in adjusted book value per share (ABVPS) in 2023, with a 7% stock price increase and an additional 20% rise year-to-date.

• Cumulative capital deployed since 1Q17 reached $2.9 billion, with $600M undeployed as of Q1 2024.

• Total capital stands at $5.6 billion, with a 10% consolidated debt-to-capital ratio and no parent-level financial leverage.

• Executed major deals including Outrigger launch, MediaAlpha share tender, Doxa preferred stock round trip, and investments in Kudu, Bamboo, and White Mountains Partners.

• Launched White Mountains Partners in late 2023 to diversify into essential services, light industrial, and specialty consumer sectors.

Operating company performance and market outlook

• Ark delivered a 2023 combined ratio of 82%, grew tangible book value over 40%, and increased gross written premiums by 31% in 2023 and 8% in Q1 2024.

• Outrigger produced a 35% return in 2023 and was fully renewed for 2024, with commitment recalibrated based on capital position.

• Kudu posted a 17% GAAP ROE and a stable 12% levered return in 2023, with a robust deal pipeline and $150M incremental capital committed.

• Bamboo, newly consolidated in January 2024, managed $277M in premiums for the trailing twelve months, up ~3x year-over-year, and turned EBITDA positive.

• MediaAlpha rebounded in Q1 2024 with TTM adjusted EBITDA up 49% year-over-year and positive momentum in the P&C vertical.

Investment strategy and financial management

• Investment portfolio of $4.1B as of Q1 2024 is managed for long-term after-tax returns, balancing liquidity and risk, with 22% in equities and alternatives.

• Total portfolio return was 9.1% in 2023 and 1.3% in Q1 2024, outperforming conventional benchmarks, aided by shorter duration fixed income and strong private equity results.

• Capital management includes a baseline 3% cash yield from operating companies, with excess capital returned to shareholders via repurchases when not deployable.

• No current plans for major exits; focus remains on compounding book value and opportunistic, disciplined capital deployment.

• ESG approach excludes thermal coal investments and supports alternative energy initiatives, while underwriting remains policy-specific.