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Q1 2024 Financial Statements

Trisura Group Ltd.

Condensed Interim Consolidated Financial Statements (unaudited)

For the three months ended March 31, 2024

TRISURA GROUP LTD.

Condensed Interim Consolidated Financial Statements (unaudited)

Table of contents for the Condensed Interim Consolidated Financial Statements of Trisura Group Ltd, as at and for the three

months ended March 31, 2024

Condensed Interim Consolidated Statements of Financial Position

2

Condensed Interim Consolidated Statements ofIncome

3

Condensed Interim Consolidated Statements ofComprehensive Income

4

Condensed Interim Consolidated Statements of Changes in Equity

5

Condensed Interim Consolidated Statements of Cash Flows

6

Notes to the Condensed Interim Consolidated Financial Statements

7

1

TRISURA GROUP LTD.

Condensed Interim Consolidated Statements of Financial Position (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

As at

Note

March 31, 2024

December 31, 2023

Assets

Cash and cash equivalents

636,186

604,016

Investments

4,6

1,056,639

890,157

Other assets

8

33,678

53,712

Reinsurance contract assets

7.2

1,947,341

2,003,589

Capital assets and intangible assets

28,053

16,657

Deferred tax assets

34,890

16,314

Total assets

3,736,787

3,584,445

Liabilities

Insurance contract liabilities

7.1

2,871,676

2,769,951

Other liabilities

9

127,897

120,065

Loan payable

11

75,000

75,000

3,074,573

2,965,016

Shareholders' equity

Common shares

12

479,282

481,023

Contributed surplus

6,645

7,491

Retained earnings

180,007

143,574

Accumulated other comprehensive loss

(3,720)

(12,659)

662,214

619,429

Total liabilities and shareholders' equity

3,736,787

3,584,445

See accompanying notes to the Condensed Interim Consolidated Financial Statements

2

TRISURA GROUP LTD.

Condensed Interim Consolidated Statements of Income (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

For the three months ended March 31,

Note

2024

2023

Insurance revenue

7.1

744,266

639,100

Insurance service expenses

(580,940)

(500,443)

Net expense from reinsurance contracts assets

7.2

(127,878)

(121,942)

Insurance service result

35,448

16,715

Net investment income

14

16,753

10,071

Net gains (losses)

15

12,276

(2,215)

Net credit impairment losses

4.2

(1,830)

(149)

Total investment income

27,199

7,707

Finance expenses from insurance contracts

(36,658)

(36,628)

Finance income from reinsurance contracts

32,800

31,902

Net insurance finance expenses

(3,858)

(4,726)

Net financial result

23,341

2,981

Net insurance and financial result

58,789

19,696

Other income

5,345

5,178

Other operating expenses

(15,012)

(5,432)

Other finance costs

11.2

(614)

(600)

Income before income taxes

48,508

18,842

Income tax expense

17

(12,075)

(4,866)

Net income attributable to shareholders

36,433

13,976

Weighted average number of common shares outstanding

47,596

45,887

during the period (in thousands) - basic

Earnings per common share (in dollars) - basic

13

0.77

0.30

Earnings per common share (in dollars) - diluted

13

0.75

0.30

See accompanying notes to the Condensed Interim Consolidated Financial Statements

3

TRISURA GROUP LTD.

Condensed Interim Consolidated Statements of Comprehensive Income (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

For the three months ended March 31,

Note

2024

2023

Net income attributable to shareholders

36,433

13,976

Items that may be or are reclassified subsequently to Net income

Net unrealized (gains) losses on FVOCI investments

(1,694)

6,730

Income tax expense (benefit)

360

(1,757)

FVOCI amounts

(1,334)

4,973

Net realized (gains) losses

(89)

715

Net credit impairment losses

4.2

1,830

149

Income tax expense

(432)

(51)

Items reclassified to Net income

1,309

813

Net unrealized losses on FVOCI investments

2,966

659

Net realized gains on FVOCI investments

-

(96)

Income tax benefit on FVOCI investments

(734)

(215)

Items that will not be reclassified to Net income

2,232

348

Items other than Cumulative translation gain (loss)

2,207

6,134

Cumulative translation gain (loss)

6,732

(213)

Other comprehensive income

8,939

5,921

Total comprehensive income

45,372

19,897

See accompanying notes to the Condensed Interim Consolidated Financial Statements

4

TRISURA GROUP LTD.

Condensed Interim Consolidated Statements of Changes in Equity (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

Accumulated other

comprehensive

Common

Contributed

Retained

loss (net of

Note

shares

surplus

earnings

income taxes)

Total

Balance as at January 1, 2024

481,023

7,491

143,574

(12,659)

619,429

Net income

-

-

36,433

-

36,433

Other comprehensive income

-

-

-

8,939

8,939

Total comprehensive income

-

-

36,433

8,939

45,372

Share issuance

12

1,335

-

-

-

1,335

Shares purchased under Restricted

12

(3,076)

-

-

-

(3,076)

Share Units ("RSUs") plan

Share based payments

-

(846)

-

-

(846)

Balance as at March 31, 2024

479,282

6,645

180,007

(3,720)

662,214

Accumulated other

comprehensive loss

Common

Contributed

Retained

(net of income

shares

surplus

earnings

taxes)

Total

Balance at January 1, 2023,

430,262

5,743

76,633

(18,987)

493,651

as restated

Net income

-

-

13,976

-

13,976

Other comprehensive income

-

-

-

5,921

5,921

Total Comprehensive income

-

-

13,976

5,921

19,897

Share issuance

711

-

-

-

711

Shares purchased under Restricted

(869)

-

-

-

(869)

Share Units ("RSUs") plan

Share based payments

-

(932)

-

-

(932)

Balance as at March 31, 2023

430,104

4,811

90,609

(13,066)

512,458

See accompanying notes to the Condensed Interim Consolidated Financial Statements

5

TRISURA GROUP LTD.

Condensed Interim Consolidated Statements of Cash Flows (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

For the three months ended March 31,

Note

2024

2023

Operating activities

Net income

36,433

13,976

Items not involving cash:

Depreciation and amortization

274

460

Unrealized (gains) losses

(8,875)

4,334

Net credit impairment losses

4.2

1,830

149

Stock options granted

387

289

Change in working capital

18

160,070

(1,046)

Realized losses on investments

330

245

Income taxes paid

(4,056)

(3,837)

Interest paid

(115)

(127)

Net cash flows from operating activities

186,278

14,443

Investing activities

38,368

Proceeds on disposal of investments

31,601

Purchases of investments

(179,636)

(79,987)

Purchases of capital assets

(474)

(79)

Acquisition of subsidiary

19

(15,015)

-

Purchases of intangible assets

(58)

(98)

Net cash flows used in investing activities

(156,815)

(48,563)

Financing activities

1,335

Shares issued

12

711

Shares purchased under RSU plan

12

(3,076)

(869)

Principal portion of lease payments

(586)

(512)

Net cash flows used in financing activities

(2,327)

(670)

Net increase (decrease) in cash and cash equivalents during the period

27,136

(34,790)

Cash, beginning of period

559,741

381,485

Cash equivalents, beginning of period

44,275

24,883

Cash and cash equivalents, beginning of period

604,016

406,368

Impact of foreign exchange on cash and cash equivalents

5,034

(3,368)

Cash, end of period

562,216

357,896

Cash equivalents, end of period

73,970

10,314

Cash and cash equivalents, end of period

636,186

368,210

See accompanying notes to the Condensed Interim Consolidated Financial Statements

6

TRISURA GROUP LTD.

Notes to the Condensed Interim Consolidated Financial Statements (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

Note 1 - The Company

Trisura Group Ltd. (the "Company") was incorporated under the Business Corporations Act (Ontario) (the "Act") on January 27, 2017. The Company's head office is located at 333 Bay Street, Suite 1610, Box 22, Toronto Ontario, M5H 2R2.

The Company has investments in wholly owned subsidiaries through which it conducts insurance and reinsurance operations. Those operations are primarily in Canada and the United States.

The Company's Canadian business operates as a Canadian property and casualty insurance company, licensed in all provinces and territories. Certain lines of the Canadian business operate as a fronting carrier with a large portion of gross premiums written ceded to reinsurers. The Company's US business is a domestic surplus lines insurer that can write business as a non-admitted surplus line insurer in all states and admitted business in most states. The US business primarily operates as a hybrid fronting carrier where a large portion of its gross premiums written are ceded to reinsurers.

The common shares of the Company are publicly traded on the Toronto Stock Exchange under the symbol "TSU".

Note 2 - Basis of presentation

These Condensed Interim Consolidated Financial Statements have been prepared in accordance with International Accounting Standard ("IAS") 34 Interim Financial Reporting, as issued by the International Accounting Standards Board ("IASB"). The Condensed Interim Consolidated Financial Statements should be read in conjunction with the annual financial statements for the year ended December 31, 2023. These statements have been prepared in accordance with International Financial Reporting Standards ("IFRS").

The Condensed Interim Consolidated Financial Statements comprise the financial results of the Company and all entities controlled by the Company, on a consolidated basis of presentation. All intra-group transactions, balances, income and expenses are eliminated in full on consolidation. In accordance with IFRS, presentation of assets and liabilities on the Condensed Interim Consolidated Statements of Financial Position is in order of liquidity. The Company's functional and presentation currency is Canadian dollars.

These Condensed Interim Consolidated Financial Statements were authorized for issuance by the Company's Board of Directors on May 2, 2024.

Note 3 - Summary of material accounting policies

The accounting policies applied during the three months ended March 31, 2024 are the same as those described and disclosed in Note 2 - Summary of material accounting policies of the December 31, 2023 Consolidated Financial Statements. The Company has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

3.1 IFRS 18 - Presentation and Disclosures in Financial Statements

In April 2024, the IASB issued IFRS 18 Presentation and Disclosures in Financial Statements, which will replace IAS 1 Presentation of Financial Statements. IFRS 18 enhances disclosure requirements in the following areas: the statement of profit and loss, aggregation and disaggregation of financial information, and management-defined performance measures. IFRS 18 is effective for annual reporting periods beginning on or after January 1, 2027, and will be applied retrospectively. The Company is currently assessing potential impacts.

7

TRISURA GROUP LTD.

Notes to the Condensed Interim Consolidated Financial Statements (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

Note 4 - Investments

4.1 Classification of cash and investments

The following table presents the classification of cash and cash equivalents, short-term securities and investments:

As at March 31, 2024

FVOCI

FVTPL

Amortized Cost

Total

Cash and cash equivalents

-

-

636,186

636,186

Investments

Short-term securities

-

-

7,500

7,500

Fixed income (1)

669,587

149,631

4,500

823,718

Common shares

-

38,677

-

38,677

Preferred shares

54,008

70,771

-

124,779

Alternatives

-

61,965

-

61,965

Total investments

723,595

321,044

12,000

1,056,639

Total cash, cash equivalents and investments

723,595

321,044

648,186

1,692,825

As at December 31, 2023

FVOCI

FVTPL

Amortized Cost

Total

Cash and cash equivalents

-

-

604,016

604,016

Investments

Short-term securities

7,500

7,500

Fixed income (1)

527,880

144,815

2,500

675,195

Common shares

-

35,412

-

35,412

Preferred shares

50,068

65,204

-

115,272

Alternatives

-

56,778

-

56,778

Total investments

577,948

302,209

10,000

890,157

Total cash, cash equivalents and investments

577,948

302,209

614,016

1,494,173
  1. As at March 31, 2024, included in Fixed income are exchange-traded debt funds amounting to $140,058 (December 31, 2023 - $138,754).

4.2 Unrealized gains and losses and carrying value of investments

The amortized cost and carrying value of investments as at March 31, 2024 and December 31, 2023 were as follows:

FVTPL

Total

As at March 31, 2024

investments

FVOCI and amortized cost investments

investments

At carrying

Amortized

Unrealized

Unrealized

Carrying

At carrying

value

cost

gains

losses

value

value

Short-term securities

-

7,500

-

-

7,500

7,500

Fixed income

149,631

689,477

-

(15,390)

674,087

823,718

Common shares

38,677

-

-

-

-

38,677

Preferred shares

70,771

57,333

-

(3,325)

54,008

124,779

Alternatives

61,965

-

-

-

-

61,965

321,044

754,310

-

(18,715)

735,595

1,056,639

8

TRISURA GROUP LTD.

Notes to the Condensed Interim Consolidated Financial Statements (unaudited)

(in thousands of Canadian dollars, except as otherwise noted)

Note 4 - Investments (Continued)

FVTPL

Total

As at December 31, 2023

investments

FVOCI and amortized cost investments

investments

At carrying

Amortized

Unrealized

Unrealized

Carrying

At carrying

value

cost

gains

losses

value

value

Short-term securities

-

7,500

-

-

7,500

7,500

Fixed income

144,815

543,868

-

(13,488)

530,380

675,195

Common shares

35,412

-

-

-

-

35,412

Preferred shares

65,204

56,303

-

(6,235)

50,068

115,272

Alternatives

56,778

-

-

-

-

56,778

302,209

607,671

-

(19,723)

587,948

890,157

The ECL of $5,122 (2023: $4,336) is recognized in Other comprehensive income, and does not reduce the carrying amount of these investments in the Condensed Interim Consolidated Statements of Financial Position.

Impairment losses on financial investments subject to impairment assessment

For the three months ended March 31, 2024 and 2023, an analysis of changes in the fair value and the corresponding ECL is as follows:

For the period ended March 31, 2024

For the period ended March 31, 2023

12mECL

LTECL

Total

12mECL

LTECL

Total

Beginning fair value

527,130

750

527,880

441,932

656

442,588

New assets purchased

173,995

-

173,995

56,368

-

56,368

Assets derecognized or matured

(37,730)

-

(37,730)

(25,756)

-

(25,756)

Change in fair value

200

(507)

(307)

6,634

(135)

6,499

Net foreign exchange income

5,749

-

5,749

-

-

-

Movement between 12mECL and LTECL

(2,175)

2,175

-

-

-

-

Ending fair value

667,169

2,418

669,587

479,178

521

479,699

For the period ended March 31, 2024

For the period ended March 31, 2023

12mECL

LTECL

Total

12mECL

LTECL

Total

Beginning ECL

3,193

99

3,292

3,935

252

4,187

New assets purchased

748

-

748

120

-

120

Assets derecognized or matured

(104)

-

(104)

(110)

-

(110)

(excl. writeoffs)

Movement in ECL

382

804

1,186

195

(56)

139

Movement between 12mECL and LTECL

(934)

934

-

(167)

167

-

Ending ECL

3,285

1,837

5,122

3,973

363

4,336

4.3 Pledged assets

In the normal course of insurance and reinsurance operations, the Company must secure its obligations under certain insurance and reinsurance contracts by collateralizing them with letters of credit or trust arrangements. As at March 31, 2024, the Company has pledged cash amounting to $499 (December 31, 2023 - $479), under insurance and reinsurance trust arrangements and are therefore not readily available for general use by the Company.

As at March 31, 2024, the Company pledged $7,939 (December 31, 2023 - $7,212) of fixed income investments, including $557 of cash and cash equivalents, as security deposits to various US state insurance departments to be held in trust for various states and are therefore not readily available for general use by the Company.

9

Disclaimer

Trisura Group Ltd. published this content on 02 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 May 2024 20:49:41 UTC.

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