22nd May 2025 13:01
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
Hiscox Ltd Capital Markets Day
Hamilton, Bermuda (22 May 2025) - Hiscox Ltd (LSE:HSX), the international specialist insurer, today hosts a Capital Markets Day for investors and analysts.
The event will feature management presentations by the Group and Retail business unit Chief Executive Officers, Group Chief Operations and Technology Officer and Group Chief Financial Officer. During the course of the presentation, management will set-out:
· The Hiscox Group strategy to deliver attractive and sustainable returns for shareholders through the substantial opportunities available through our diversified business model, highly differentiated exposure to specialty markets and our specialist technical capabilities.
· A deep dive into the Hiscox Retail strategy, including details on:
o The size of the opportunity in our target addressable market of $317 billion annualised premiums.
o How each of our Retail business units will capture this opportunity to deliver profitable and sustainable growth, outgrowing the market, through:
§ going deeper into our specialist sectors and expanding into new ones
§ expanding distribution and adding more channels
§ adding new products, and
§ entering selective new geographies
o The ambition for Retail is to accelerate premium growth to double-digit in 2028 by continuing to take share in each of our sizeable serviceable addressable markets.
· Details of an acceleration and enhancement of the ongoing change agenda across the Group to further unlock growth, optimise expense efficiency and enhance operating leverage.
o These initiatives will enable Hiscox to deliver an annualised P&L benefit of $200 million in 2028 onwards, against the 2024 baseline, with a cost to achieve of $200 million over the same period.
o The majority of the $200 million benefit will be recognised in Retail across a combination of claims, attributable and non-attributable expenses.
o These initiatives reinforce management's confidence to not only operate sustainably within our stated undiscounted combined ratio operating range of 89%-94%, but also to drive Retail margin improvement while continuing to invest in growth.
o The phasing of the programme will be:
US$m | FY 2025 | FY 2026 | FY 2027 | FY 2028 |
P&L benefit | 25 | 75 | 145 | 200 |
Cost to achieve | (25) | (75) | (100) | - |
Net benefit | - | - | 45 | 200 |
· Our plans to drive capital and balance sheet efficiency to further maximise shareholder returns, including:
o The introduction of a Bermuda Solvency Capital Ratio (BSCR) target range that the Group intends to operate within of 190%-200%[1]; and
o To appropriately deploy the headroom in the Group's leverage in supporting the Group's strategic ambitions.
Enhanced and sustainable go-forward shareholder returns
Reflecting the changing shape of the Group, with Retail expected to be a greater proportion as each of the businesses grow over time, and the confidence in the strategy, the Board is setting new guidance which reflects Hiscox's enhanced and more sustainable return profile:
· A mid-teens operating Return on Tangible Equity[2] through the cycle.
· A 20% step-up in final Dividend per Share at full-year 2025, subject to final ratification ahead of full-year 2025 results, with a progressive dividend per share thereafter.
o This follows the 15% step-up in the ordinary dividend per share in 2024.
o For the interim dividend, our policy going forward will be to pay one-third of the prior year total ordinary dividend per share, providing more clarity on mid-year capital returns.
o Hiscox's previously announced $175 million buyback programme for 2025 continues.
The presentation materials and the link to the webcast will be available on Hiscox's corporate website prior to the event. A recording of the event will be made available afterwards. Both can be accessed at https://www.hiscoxgroup.com/investors
No new material trading information will be disclosed at the event.
ENDS
A conference call for investors and analysts will be held at 14:00 BST on Thursday, 22 May 2025.
Participant dial-in numbers:
United Kingdom (Local): +44 20 3936 2999
All other locations: +44 800 358 1035Participant Access Code: 573127
Investors and analysts
Yana O'Sullivan, Director of Investor Relations, London +44 (0)20 3321 5598
Marc Wetherhill, Group Company Secretary, Bermuda +1 441 278 8300
Media
Eleanor Orebi Gann, Group Director of Communications, London +44 (0)20 7081 4815
Simone Selzer, Brunswick +44 (0)20 7404 5959
Tom Burns, Brunswick +44 (0)20 7404 5959
The person responsible for arranging and authorising the release of this announcement on behalf of the Company is Marc Wetherhill, Group Company Secretary.
Notes to editors
About The Hiscox Group
Hiscox is a global specialist insurer, headquartered in Bermuda and listed on the London Stock Exchange (LSE:HSX). Our ambition is to be a respected specialist insurer with a diverse portfolio by product and geography. We believe that building balance between catastrophe-exposed business and less volatile local specialty business gives us opportunities for profitable growth throughout the insurance cycle.
The Hiscox Group employs over 3,000 people in 13 countries, and has customers worldwide. Through the retail businesses in the USA, UK and Europe, we offer a range of specialist insurance products in commercial and personal lines. Internationally-traded, bigger-ticket business and reinsurance is underwritten through Hiscox London Market and Hiscox Re & ILS.
Our values define our business, with a focus on people, courage, ownership and integrity. We pride ourselves on being true to our word and our award-winning claims service is testament to that. For more information, visit www.hiscoxgroup.com.
This announcement does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any shares or other securities in Hiscox Ltd ("Hiscox" or the "Company").
This announcement contains certain forward-looking statements regarding our intentions, beliefs or current expectations concerning, amongst other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the economic and business circumstances occurring from time to time in the countries and markets in which the Company operates. These statements are often, but not always, made through the use of words or phrases such as "believe," "anticipate," "could," "may," "would," "should," "intend," "plan," "potential," "predict," "will," "expect," "estimate," "project," "positioned," "strategy," "outlook", "target" and similar expressions.
It is believed that the expectations reflected in this announcement are reasonable but they may be affected by a wide range of variables that could cause actual results to differ materially from those currently anticipated. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking statements, assumptions and information included in this announcement are known or unknown risks, identified or unidentified uncertainties and other factors related to the following: the effect of mergers, acquisitions and divestitures on Hiscox's operating results and businesses generally; the impact of adverse domestic or international legislation and regulation; changes in domestic or international tax laws and rates; adverse litigation and dispute outcomes and the effect of such outcomes on Hiscox's financial condition; changes or differences in domestic or international economic or political conditions; the ability to obtain price increases and the impact of price increases on consumer affordability thresholds; adverse decisions by domestic or international regulatory bodies; translational and transactional foreign exchange rate exposure; the ability to maintain credit ratings; the ability to develop, produce or market new alternative products and to do so profitably; the ability to effectively implement strategic initiatives and actions taken to increase sales growth; the ability to enhance cash generation and pay dividends and changes in the market position, businesses, financial condition, results of operations or prospects of Hiscox.
Past performance is no guide to future performance and persons needing advice should consult an independent financial adviser. The forward-looking statements contained in this announcement reflect the knowledge and information available to Hiscox at the date of preparation of this announcement and Hiscox undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on such forward-looking statements.
No statement in this communication is intended to be, nor should be construed as, a profit forecast or a profit estimate and no statement in this communication should be interpreted to mean that earnings per share of Hiscox for the current or any future financial periods would necessarily match, exceed or be lower than the historical published earnings per share of Hiscox.
[1]After payment of the final ordinary dividend.
[2]The Group is introducing four new alternative performance measures to provide a clearer view of the underlying performance of the Group's ongoing core operating activities: adjusted operating profit before tax, adjusted operating profit after tax, adjusted operating earnings per share, operating return on tangible equity. The adjusting P&L items for adjusted operating profit before tax include; impacts of mark-to-market movements on fixed income investments, the impact of movement in yields on insurance finance income and expense, one-offs such as restructuring costs or inception of LPTs, profit or loss arising from discontinued or non-core operations, share of profit or loss of associates and foreign exchange gains or losses. Adjusted operating profit after tax is calculated using adjusted operating profit before tax and the Group's effective tax rate, adjusted for any one-off tax items. Adjusted operating earnings per share is calculated as adjusted operating profit after tax divided by the average number of shares in the period, in line with the earnings per share calculation. Operating return on tangible equity is calculated as adjusted operating profit after tax divided by adjusted opening tangible equity. Adjusted opening tangible equity is calculated as opening equity adjusted for the time-weighted impact of equity raises and distributions, goodwill and intangibles, accumulated fair value gains or losses on fixed income investments and the net impact of discounting on insurance assets and liabilities.
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