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 2, 2024
Enstar Group Limited
(Exact name of registrant as specified in its charter)
| Bermuda | N/A | |||||||||||||
(State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (441 ) 292-3645
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):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | |||||||||
| LLC | |||||||||||
| LLC | |||||||||||
| Perpetual Non-Cumulative Preferred Share, Series D, Par Value $1.00 Per Share | |||||||||||
| LLC | |||||||||||
| in a 7.00% Perpetual Non-Cumulative Preferred Share, Series E, Par Value $1.00 Per Share | |||||||||||
Indicate by check mark whether the registrant is an emerging growth company 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 2, 2024, Enstar Group Limited (the "Company") issued a press release announcing its results for the quarter ended March 31, 2024 (the "Press Release"), a copy of which is furnished with this report as Exhibit 99.1 and incorporated herein by reference, a Financial Supplement for the quarter ended March 31, 2024 (the "Financial Supplement"), a copy of which is furnished with this report as Exhibit 99.2 and incorporated herein by reference, and an audio update discussing its results for the quarter ended March 31, 2024 (the "Audio Update"). The Press Release, the Financial Supplement and the Audio Update will be available on the "Investor Relations" page of the Company's website located at www.enstargroup.com.
The information contained in the Press Release, the Financial Supplement and the Audio Update is summary information that is intended to be considered in the context of the Company's Securities and Exchange Commission ("SEC") filings and other public announcements that the Company may make, by press release or otherwise, from time to time. The Company undertakes no duty or obligation to publicly update or revise the information contained in the Press Release, the Financial Supplement and the Audio Update, although it may do so from time to time as its management believes is warranted. Any such updating may be made through the filing of other reports or documents with the SEC, through press releases or through other public disclosure.
The information presented in Item 2.02 of this Current Report on Form 8-K and Exhibits 99.1 and 99.2 shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, unless the Company specifically states that the information is to be considered “filed” under the Exchange Act or specifically incorporates it by reference into a filing under the Securities Act of 1933, as amended.
Item 9.01. Financial Statements and Exhibits.
Exhibits
| Exhibit No. | Description | |||||||
Press Release, dated May 2, 2024. | ||||||||
Financial Supplement for the quarter ended March 31, 2024. | ||||||||
| 101 | Pursuant to Rule 406 of Regulation S-T, the cover page information in formatted in Inline XBRL | |||||||
| 104 | Cover page Interactive Data File (embedded within the Inline XBRL document and included in Exhibit 101) | |||||||
1
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.
| ENSTAR GROUP LIMITED | |||||||||||
| May 2, 2024 | By: | /s/ Matthew Kirk | |||||||||
| Matthew Kirk | |||||||||||
| Chief Financial Officer | |||||||||||
Press Release 
Date: May 2, 2024 Contact: Enstar Communications
For Release: Immediately Telephone: +1 (441) 292-3645
Enstar Group Limited Reports First Quarter 2024 Results
•Net Income Attributable to Enstar Ordinary Shareholders of $119 Million; Return on Equity of 2.4% Primarily Driven by Positive Investment Results
•Growth in Book Value per Ordinary Share of 1.7% to $349.41 (Fully Diluted* $341.53)
•Announced $400 Million Loss Portfolio Transaction with SiriusPoint, Subsequent to Quarter End
•Bermuda-based Wholly Owned Subsidiary, Cavello Bay Reinsurance Limited Assigned Insurer Financial Strength Rating of ‘A’ with Stable Outlook by S&P Global Ratings
* Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.
HAMILTON, Bermuda - May 2, 2024 - Enstar Group Limited (Nasdaq: ESGR) today announced financial results for the first quarter 2024.
First Quarter 2024 Highlights:
•Net income attributable to Enstar ordinary shareholders of $119 million, or $8.02 per diluted ordinary share, compared to $424 million, or $24.79 per diluted ordinary share, for the three months ended March 31, 2023.
•Return on equity ("ROE") of 2.4% and Adjusted ROE* of 2.6% for the quarter compared to ROE and Adjusted ROE* of 9.5% and 6.8%, respectively, in the first quarter of 2023. The prior-year period’s ROE and Adjusted ROE* included a $194 million net gain recognized on the novation of Enhanzed Re reinsurance closed block of life annuity policies. Year-over-year ROE performance was also impacted by a decline in the gain from fair value changes in trading securities, funds held and other investments. First quarter 2024 Adjusted ROE* also excludes $25 million of net realized losses on our fixed maturities and fair value changes in trading securities and funds held.
•Run-off liability earnings ("RLE") of $24 million for the quarter (compared to RLE of $10 million in the prior-year period) was driven by favorable development on our professional indemnity/directors and officers and asbestos lines of business, partially offset by adverse development on our general casualty and environmental lines of business.
•Annualized total investment return (“TIR”) of 4.9% and Annualized Adjusted TIR* of 5.5% for the quarter compared to Annualized TIR and Annualized Adjusted TIR* of 9.5% and 6.3%, respectively, for the three months ended March 31, 2023. Recognized investment results in the first quarter of 2024 benefited from net investment income of $160 million and fair value change in other investments, including equities, of $104 million, partially offset by net realized and unrealized losses on our fixed maturities, including other comprehensive income (“OCI”), of $37 million.
•Enstar’s Bermuda-based wholly owned subsidiary Cavello Bay Reinsurance Limited was assigned an Insurer Financial Strength Rating of ‘A’ with stable outlook by S&P Global Ratings.
•Announced $400 million Loss Portfolio Transfer (“LPT”) agreement with SiriusPoint subsequent to quarter-end, to reinsure a portfolio of workers’ compensation business covering underwriting years 2018 to 2023.
Enstar Group Limited | 2024 Press Release 1
* Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.
Dominic Silvester, Enstar CEO, said:
“Our momentum continues with a growth in book value of 1.7% in the first quarter, driven by solid performance in our investment portfolio and another quarter of positive Run-Off Liability Earnings.
We were pleased to execute a $400 million Loss Portfolio Transfer with SiriusPoint earlier this week. The transaction expands our Workers’ Compensation portfolio, which is a line of business where we have a wealth of experience and have had significant success. We look forward to taking advantage of opportunities across our business throughout the year, as we stay focused on meeting the growing risk management needs of the (re)insurance sector while creating long-term value for our shareholders.”
Enstar Group Limited | 2024 Press Release 2
Key Financial and Operating Metrics
We use the following GAAP and Non-GAAP measures to monitor the performance of and manage the company:
| Three Months Ended | |||||||||||||||||
| March 31, | $ / pp / bp Change | ||||||||||||||||
| 2024 | 2023 | ||||||||||||||||
| (in millions of U.S. dollars, except per share data) | |||||||||||||||||
| Key Earnings Metrics | |||||||||||||||||
| Net income attributable to Enstar ordinary shareholders | $ | 119 | $ | 424 | $ | (305) | |||||||||||
| Adjusted operating income attributable to Enstar ordinary shareholders* | $ | 141 | $ | 401 | $ | (260) | |||||||||||
| ROE | 2.4 | % | 9.5 | % | (7.1) | pp | |||||||||||
| Adjusted ROE* | 2.6 | % | 6.8 | % | (4.2) | pp | |||||||||||
| Key Run-off Metrics | |||||||||||||||||
| Prior period development | $ | 24 | $ | 10 | $ | 14 | |||||||||||
| Adjusted prior period development* | $ | 24 | $ | 36 | $ | (12) | |||||||||||
| RLE | 0.2 | % | 0.1 | % | 0.1 | pp | |||||||||||
| Adjusted RLE* | 0.2 | % | 0.3 | % | (0.1) | pp | |||||||||||
| Key Investment Return Metrics | |||||||||||||||||
| Total investable assets | $ | 17,677 | $ | 17,773 | $ | (96) | |||||||||||
| Adjusted total investable assets* | $ | 18,466 | $ | 18,767 | $ | (301) | |||||||||||
| Annualized investment book yield | 4.36 | % | 3.58 | % | 78 | bp | |||||||||||
| TIR | 4.9 | % | 9.5 | % | (4.6) | pp | |||||||||||
| Adjusted TIR* | 5.5 | % | 6.3 | % | (0.8) | pp | |||||||||||
| As of | |||||||||||||||||
| Key Shareholder Metrics | March 31, 2024 | December 31, 2023 | |||||||||||||||
| Book value per ordinary share | $ | 349.41 | $ | 343.45 | $ | 5.96 | |||||||||||
| Fully diluted book value per ordinary share* | $ | 341.53 | $ | 336.72 | $ | 4.81 | |||||||||||
pp - Percentage point(s)
bp - Basis point(s)
*Non-GAAP measure; refer to "Non-GAAP Financial Measures" further below for explanatory notes and a reconciliation to the most directly comparable GAAP measure.
Enstar Group Limited | 2024 Press Release 3
Results of Operations By Segment - For the Three Months Ended March 31, 2024 and 2023
Run-off Segment
The following is a discussion and analysis of the results of operations for our Run-off segment.
| Three Months Ended | ||||||||||||||||||||
| March 31, | $ Change | |||||||||||||||||||
| 2024 | 2023 | |||||||||||||||||||
| REVENUES | (in millions of U.S. dollars) | |||||||||||||||||||
| Net premiums earned | $ | 11 | $ | 8 | $ | 3 | ||||||||||||||
| Other income: | ||||||||||||||||||||
| Reduction in estimates of net ultimate defendant A&E liabilities - prior periods | — | 2 | (2) | |||||||||||||||||
| Reduction in estimated future defendant A&E expenses | 1 | 1 | — | |||||||||||||||||
| All other income | 2 | 2 | — | |||||||||||||||||
| Total other income | 3 | 5 | (2) | |||||||||||||||||
| Total revenues | 14 | 13 | 1 | |||||||||||||||||
| EXPENSES | ||||||||||||||||||||
| Net incurred losses and LAE: | ||||||||||||||||||||
| Current period | 5 | 10 | (5) | |||||||||||||||||
| Prior periods: | ||||||||||||||||||||
| Reduction in estimates of net ultimate losses | (6) | (15) | 9 | |||||||||||||||||
| Reduction in provisions for ULAE | (17) | (18) | 1 | |||||||||||||||||
| Total prior periods | (23) | (33) | 10 | |||||||||||||||||
| Total net incurred losses and LAE | (18) | (23) | 5 | |||||||||||||||||
| Acquisition costs | 1 | 2 | (1) | |||||||||||||||||
| General and administrative expenses | 42 | 39 | 3 | |||||||||||||||||
| Total expenses | 25 | 18 | 7 | |||||||||||||||||
| SEGMENT NET LOSS | $ | (11) | $ | (5) | $ | (6) | ||||||||||||||
Overall Results
Three Months Ended March 31, 2024 versus 2023: Net loss from our Run-off segment was $11 million compared to net loss of $5 million in the comparative quarter, primarily due to:
•A $10 million decrease in favorable PPD in the current quarter, mainly driven by a $9 million increase in the reduction in estimates of net ultimate losses in the comparative quarter.
◦During the first quarter of 2024, the net favorable development was primarily due to favorable development on our Professional Indemnity/Directors and Officers line of business of $29 million driven by favorable claims experience and favorable development on our Asbestos line of business of $24 million resulting from actuarial analysis. These were partially offset by adverse development on our General Casualty line of business of $18 million driven by adverse claims experience and adverse development on our Environmental line of business of $25 million due to results from actuarial reviews in the period.
◦In comparison, during the first quarter of 2023 we recognized favorable development of $11 million on our workers’ compensation line of business as a result of favorable claims experience, most notably in the 2021 acquisition year.
•A net favorable change in current period net incurred losses and LAE and acquisition costs of $6 million.
Enstar Group Limited | 2024 Press Release 4
Investments Segment
The following is a discussion and analysis of the results of operations for our Investments segment.
| Three Months Ended | |||||||||||||||||
| March 31, | $ Change | ||||||||||||||||
| 2024 | 2023 | ||||||||||||||||
| (in millions of U.S. dollars) | |||||||||||||||||
| REVENUES | |||||||||||||||||
| Net investment income: | |||||||||||||||||
| Fixed maturities | $ | 142 | $ | 131 | $ | 11 | |||||||||||
| Cash and restricted cash | 8 | 5 | 3 | ||||||||||||||
| Other investments, including equities | 20 | 24 | (4) | ||||||||||||||
| Less: Investment expenses | (10) | (4) | (6) | ||||||||||||||
| Total net investment income | 160 | 156 | 4 | ||||||||||||||
| Net realized losses: | |||||||||||||||||
| Fixed maturities | (6) | (18) | 12 | ||||||||||||||
| Total net realized losses | (6) | (18) | 12 | ||||||||||||||
| Fair value changes in: | |||||||||||||||||
| Fixed maturities, trading | (19) | 59 | (78) | ||||||||||||||
| Other investments, including equities | 104 | 147 | (43) | ||||||||||||||
| Total fair value changes in trading securities and other investments | 85 | 206 | (121) | ||||||||||||||
| Total revenues | 239 | 344 | (105) | ||||||||||||||
| EXPENSES | |||||||||||||||||
| General and administrative expenses | 10 | 11 | (1) | ||||||||||||||
| Total expenses | 10 | 11 | (1) | ||||||||||||||
| (Loss) income from equity method investments | (5) | 11 | (16) | ||||||||||||||
| SEGMENT NET INCOME | $ | 224 | $ | 344 | $ | (120) | |||||||||||
Overall Results
Three Months Ended March 31, 2024 versus 2023: Net income from our Investments segment was $224 million for the three months ended March 31, 2024 compared to net income of $344 million for the three months ended March 31, 2023. The variance of $120 million was primarily due to:
•a decrease in the gain from fair value changes in fixed maturities of $78 million, primarily as a result of increases in interest rates across U.S., U.K. and European markets in the current period, in comparison to decreases in interest rates in the comparative period;
•fair value change in other investments, including equities, of $104 million, compared to $147 million in the comparative period. The decrease of $43 million was primarily driven by:
◦a decrease in gain in the fair value change in other investments of $18 million for the three months ended March 31, 2024, primarily driven by an unfavorable variance in the fair value change of an embedded derivative in relation to the Aspen LPT, partially offset by increases in the fair value change related to CLO equity funds, private equity funds, real estate funds and high yield bond and loan funds relative to the comparative quarter; and
◦a decrease in the gain in fair value changes in equities of $16 million for the three months ended March 31, 2024, largely as a result of the reduced amount of equities within the investment portfolio relative to the comparative quarter.
•an increase in our net investment income of $4 million, which is primarily due to the reinvestment of fixed maturities at higher yields, deployment of consideration received from deals closed over the past 12 months and the impact of rising interest rates on the $3.1 billion of our average fixed maturities outstanding during the
Enstar Group Limited | 2024 Press Release 5
current period that are subject to floating interest rates. Our floating rate investments generated net investment income of $58 million, an increase of $2 million in comparison to the comparative quarter.
Income and (Loss) by Segment - For the Three Months Ended March 31, 2024 and 2023
| Three Months Ended | |||||||||||||||||
| March 31, | |||||||||||||||||
| 2024 | 2023 | $ Change | |||||||||||||||
| (in millions of U.S. dollars) | |||||||||||||||||
| REVENUES | |||||||||||||||||
| Run-off | $ | 14 | $ | 13 | $ | 1 | |||||||||||
| Investments | 239 | 344 | (105) | ||||||||||||||
Assumed Life (1) | — | 275 | (275) | ||||||||||||||
| Subtotal | 253 | 632 | (379) | ||||||||||||||
Corporate and other (1) | (3) | — | (3) | ||||||||||||||
| Total revenues | $ | 250 | $ | 632 | $ | (382) | |||||||||||
| SEGMENT NET INCOME (LOSS) | |||||||||||||||||
| Run-off | $ | (11) | $ | (5) | $ | (6) | |||||||||||
| Investments | 224 | 344 | (120) | ||||||||||||||
Assumed Life (1) | — | 275 | (275) | ||||||||||||||
| Total segment net income | 213 | 614 | (401) | ||||||||||||||
Corporate and other (1) | (94) | (190) | 96 | ||||||||||||||
| NET INCOME ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS | $ | 119 | $ | 424 | $ | (305) | |||||||||||
(1) Effective January 1, 2024, Assumed Life and Legacy Underwriting were determined to no longer meet the definition of reportable segments and their residual income and loss activities were prospectively included in Corporate and other activities. Activities prior to January 1, 2024 are recorded in their respective segments. In addition, Legacy Underwriting had no revenue or income activity for the three months ended March 31, 2024 and 2023 and therefore is excluded from the table above.
For additional detail on the former Assumed Life and Legacy Underwriting segments and Corporate and other activities, please refer to our Quarterly Report on Form 10-Q for the period ended March 31, 2024.
Enstar Group Limited | 2024 Press Release 6
Cautionary Statement
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements regarding the intent, belief or current expectations of Enstar and its management team. Investors can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as ‘aim’, ‘anticipate’, ‘estimate’, ‘expect’, ‘intend’, ‘will’, ‘project’, ‘plan’, ‘believe’, ‘target’ and other words and terms of similar meaning in connection with any discussion of future events or performance. Investors are cautioned that any such forward-looking statements speak only as of the date they are made, are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Important risk factors regarding Enstar can be found under the heading "Risk Factors" in our Form 10-K for the year ended December 31, 2023 and are incorporated herein by reference. Furthermore, Enstar undertakes no obligation to update any written or oral forward-looking statements or publicly announce any updates or revisions to any of the forward-looking statements contained herein, to reflect any change in its expectations with regard thereto or any change in events, conditions, circumstances or assumptions underlying such statements, except as required by law.
About Enstar
Enstar is a NASDAQ-listed leading global (re)insurance group that offers capital release solutions through its network of group companies in Bermuda, the United States, the United Kingdom, Continental Europe and Australia. A market leader in completing legacy acquisitions, Enstar has acquired over 115 companies and portfolios since its formation. For further information about Enstar, see www.enstargroup.com.
Contacts
For Investors: Matthew Kirk (investor.relations@enstargroup.com)
For Media: Jenna Kerr (communications@enstargroup.com)
Enstar Group Limited | 2024 Press Release 7
ENSTAR GROUP LIMITED
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2024 and 2023
| Three Months Ended March 31, | |||||||||||
| 2024 | 2023 | ||||||||||
| (expressed in millions of U.S. dollars, except share and per share data) | |||||||||||
REVENUES | |||||||||||
| Net premiums earned | $ | 11 | $ | 8 | |||||||
| Net investment income | 160 | 156 | |||||||||
| Net realized losses | (6) | (18) | |||||||||
| Fair value changes in trading securities, funds held and other investments | 85 | 206 | |||||||||
| Other income | — | 280 | |||||||||
| Total revenues | 250 | 632 | |||||||||
| EXPENSES | |||||||||||
| Net incurred losses and loss adjustment expenses | |||||||||||
| Current period | 5 | 10 | |||||||||
| Prior periods | (24) | (10) | |||||||||
| Total net incurred losses and loss adjustment expenses | (19) | — | |||||||||
| Amortization of net deferred charge assets | 30 | 17 | |||||||||
| Acquisition costs | 1 | 2 | |||||||||
| General and administrative expenses | 87 | 89 | |||||||||
| Interest expense | 22 | 23 | |||||||||
| Net foreign exchange gains | (9) | (6) | |||||||||
| Total expenses | 112 | 125 | |||||||||
| INCOME BEFORE INCOME TAXES | 138 | 507 | |||||||||
| Income tax (expense) benefit | (5) | 1 | |||||||||
| (Loss) income from equity method investments | (5) | 11 | |||||||||
| NET INCOME | 128 | 519 | |||||||||
| Net income attributable to noncontrolling interest | — | (86) | |||||||||
| NET INCOME ATTRIBUTABLE TO ENSTAR GROUP LIMITED | 128 | 433 | |||||||||
| Dividends on preferred shares | (9) | (9) | |||||||||
| NET INCOME ATTRIBUTABLE TO ENSTAR GROUP LIMITED ORDINARY SHAREHOLDERS | $ | 119 | $ | 424 | |||||||
| Earnings per ordinary share attributable to Enstar: | |||||||||||
| Basic | $ | 8.13 | $ | 24.97 | |||||||
| Diluted | $ | 8.02 | $ | 24.79 | |||||||
| Weighted average ordinary shares outstanding: | |||||||||||
| Basic | 14,641,158 | 16,980,240 | |||||||||
| Diluted | 14,833,840 | 17,100,954 | |||||||||
Enstar Group Limited | 2024 Press Release 8
ENSTAR GROUP LIMITED
CONDENSED CONSOLIDATED BALANCE SHEETS
As of March 31, 2024 and 2023
| March 31, 2024 | December 31, 2023 | ||||||||||
| (in millions of U.S. dollars, except share data) | |||||||||||
| ASSETS | |||||||||||
| Short-term investments, trading, at fair value | $ | 6 | $ | 2 | |||||||
Short-term investments, available-for-sale, at fair value (amortized cost: 2024 — $41; 2023 — $62) | 41 | 62 | |||||||||
| Fixed maturities, trading, at fair value | 1,862 | 1,949 | |||||||||
Fixed maturities, available-for-sale, at fair value (amortized cost: 2024 — $5,462; 2023 — $5,642; net of allowance: 2024 — $17; 2023 — $16) | 5,046 | 5,261 | |||||||||
| Funds held | 4,880 | 5,251 | |||||||||
Equities, at fair value (cost: 2024 — $602; 2023 — $615) | 738 | 701 | |||||||||
Other investments, at fair value (includes consolidated variable interest entity: 2024 - $97; 2023 - $59) | 4,018 | 3,853 | |||||||||
| Equity method investments | 326 | 334 | |||||||||
| Total investments | 16,917 | 17,413 | |||||||||
| Cash and cash equivalents (includes consolidated variable interest entity: 2024 — $0; 2023 — $8) | 450 | 564 | |||||||||
| Restricted cash and cash equivalents | 310 | 266 | |||||||||
| Accrued interest receivable | 73 | 71 | |||||||||
Reinsurance balances recoverable on paid and unpaid losses (net of allowance: 2024 — $121; 2023 — $131) | 692 | 740 | |||||||||
| Reinsurance balances recoverable on paid and unpaid losses, at fair value | 207 | 217 | |||||||||
Insurance balances recoverable (net of allowance: 2024 and 2023 — $5) | 170 | 172 | |||||||||
| Net deferred charge assets | 701 | 731 | |||||||||
| Other assets | 745 | 739 | |||||||||
| TOTAL ASSETS | $ | 20,265 | $ | 20,913 | |||||||
| LIABILITIES | |||||||||||
| Losses and loss adjustment expenses | $ | 10,452 | $ | 11,196 | |||||||
| Losses and loss adjustment expenses, at fair value | 1,098 | 1,163 | |||||||||
| Defendant asbestos and environmental liabilities | 556 | 567 | |||||||||
| Insurance and reinsurance balances payable | 107 | 43 | |||||||||
| Debt obligations | 1,832 | 1,831 | |||||||||
Other liabilities (includes consolidated variable interest entity: 2024 — $0; 2023 — $1) | 474 | 465 | |||||||||
| TOTAL LIABILITIES | 14,519 | 15,265 | |||||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||||
| SHAREHOLDERS’ EQUITY | |||||||||||
Voting ordinary Shares (par value $1 each, issued and outstanding 2024: 15,224,431; 2023: 15,196,685) | 15 | 15 | |||||||||
| Preferred Shares: | |||||||||||
| Series C Preferred Shares (issued and held in treasury 2024 and 2023: 388,571) | — | — | |||||||||
Series D Preferred Shares (issued and outstanding 2024 and 2023: 16,000; liquidation preference $400) | 400 | 400 | |||||||||
Series E Preferred Shares (issued and outstanding 2024 and 2023: 4,400; liquidation preference $110) | 110 | 110 | |||||||||
| Treasury Shares, at cost: | |||||||||||
| Series C Preferred shares (2024 and 2023: 388,571) | (422) | (422) | |||||||||
| Joint Share Ownership Plan (voting ordinary shares, held in trust 2024 and 2023: 565,630) | (1) | (1) | |||||||||
| Additional paid-in capital | 585 | 579 | |||||||||
| Accumulated other comprehensive loss | (364) | (336) | |||||||||
| Retained earnings | 5,309 | 5,190 | |||||||||
| Total Enstar Shareholders’ Equity | 5,632 | 5,535 | |||||||||
| Noncontrolling interests | 114 | 113 | |||||||||
| TOTAL SHAREHOLDERS’ EQUITY | 5,746 | 5,648 | |||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 20,265 | $ | 20,913 | |||||||
Enstar Group Limited | 2024 Press Release 9
Non-GAAP Financial Measures
In addition to our key financial measures presented in accordance with GAAP, we present other non-GAAP financial measures that we use to manage our business, compare our performance against prior periods and against our peers, and as performance measures in our incentive compensation program.
These non-GAAP financial measures provide an additional view of our operational performance over the long-term and provide the opportunity to analyze our results in a way that is more aligned with the manner in which our management measures our underlying performance.
The presentation of these non-GAAP financial measures, which may be defined and calculated differently by other companies, is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with GAAP.
Some of the adjustments reflected in our non-GAAP measures are recurring items, such as the exclusion of adjustments to net realized (gains)/losses and fair value changes on fixed maturity investments recognized in our statements of operations, the fair value of certain of our loss reserve liabilities for which we have elected the fair value option, and the amortization of fair value adjustments.
Management makes these adjustments in assessing our performance so that the changes in fair value due to interest rate movements, which are applied to some but not all of our assets and liabilities as a result of preexisting accounting elections, do not impair comparability across reporting periods.
It is important for the readers of our periodic filings to understand that these items will recur from period to period.
However, we exclude these items for the purpose of presenting a comparable view across reporting periods of the impact of our underlying claims management and investments without the effect of interest rate fluctuations on assets that we anticipate to hold to maturity and non-cash changes to the fair value of our reserves.
Similarly, our non-GAAP measures reflect the exclusion of certain items that we deem to be nonrecurring, unusual or infrequent when the nature of the charge or gain is such that it is not reasonably likely that such item may recur within two years, nor was there a similar charge or gain in the preceding two years. This includes adjustments related to bargain purchase gains on acquisitions of businesses, net gains or losses on sales of subsidiaries, net assets of held for sale or disposed subsidiaries classified as discontinued operations and other items that we separately disclose.
The following table presents more information on each non-GAAP measure. The results and GAAP reconciliations for these measures are set forth further below.
| Non-GAAP Measure | Definition | Purpose of Non-GAAP Measure over GAAP Measure | ||||||||||||
| Fully diluted book value per ordinary share | Total Enstar ordinary shareholders' equity Divided by Number of ordinary shares outstanding, adjusted for: -the ultimate effect of any dilutive securities (which include restricted shares, restricted share units, directors’ restricted share units and performance share units) on the number of ordinary shares outstanding | Increases the number of ordinary shares to reflect the exercise of equity awards granted but not yet vested as, over the long term, this presents both management and investors with a more economically accurate measure of the realizable value of shareholder returns by factoring in the impact of share dilution. We use this non-GAAP measure in our incentive compensation program. | ||||||||||||
Enstar Group Limited | 2024 Press Release 10
| Adjusted return on equity (%) | Adjusted operating income (loss) attributable to Enstar ordinary shareholders divided by adjusted opening Enstar ordinary shareholder's equity | Calculating the operating income (loss) as a percentage of our adjusted opening Enstar ordinary shareholders' equity provides a more consistent measure of the performance of our business by enabling comparison between the financial periods presented. We eliminate the impact of fair value changes and net realized (gains) losses on fixed maturities and funds-held directly managed and the change in fair value of insurance contracts for which we have elected the fair value option, as: •we typically hold most of our fixed maturities until the earlier of maturity or the time that they are used to fund any settlement of related liabilities which are generally recorded at cost; and •removing the fair value option improves comparability since there are limited acquisition years for which we elected the fair value option. Therefore, we believe that excluding their impact on our earnings improves comparability of our core operational performance across periods. We include fair value adjustments as non-GAAP adjustments to the adjusted operating income (loss) attributable to Enstar ordinary shareholders as they are non-cash charges that are not reflective of the impact of our claims management strategies on our loss portfolios. We eliminate the net gain (loss) on the purchase and sales of subsidiaries and net income from discontinued operations, as these items are not indicative of our ongoing operations. We use this non-GAAP measure in our incentive compensation program. | ||||||||||||
Adjusted operating income (loss) attributable to Enstar ordinary shareholders (numerator) | Net income (loss) attributable to Enstar ordinary shareholders, adjusted for: -fair value changes and net realized (gains) losses on fixed maturities and funds held-directly managed, -change in fair value of insurance contracts for which we have elected the fair value option (1), -amortization of fair value adjustments, -net gain/loss on purchase and sales of subsidiaries (if any), -net income from discontinued operations (if any), -tax effects of adjustments, and -adjustments attributable to noncontrolling interests | |||||||||||||
Adjusted opening Enstar ordinary shareholders' equity (denominator) | Opening Enstar ordinary shareholders' equity, less: -fair value changes on fixed maturities and funds held-directly managed, -fair value of insurance contracts for which we have elected the fair value option (1), -fair value adjustments, and -net assets of held for sale or disposed subsidiaries classified as discontinued operations (if any) | |||||||||||||
Enstar Group Limited | 2024 Press Release 11
| Adjusted run-off liability earnings (%) | Adjusted PPD divided by average adjusted net loss reserves. | Calculating the RLE as a percentage of our adjusted average net loss reserves provides a more meaningful and comparable measurement of the impact of our claims management strategies on our loss portfolios across acquisition years and also to our overall financial periods. We use this measure to evaluate the impact of our claims management strategies because it provides visibility into our ability to settle our claims obligations for amounts less than our initial estimate at the point of acquiring the obligations. The following components of periodic recurring net incurred losses and LAE and net loss reserves are not considered key components of our claims management performance for the following reasons: •Prior to the settlement of the contractual arrangements, the results of our Legacy Underwriting segment were economically transferred to a third party primarily through use of reinsurance and a Capacity Lease Agreement(3); as such, the results were not a relevant contribution to Adjusted RLE, which is designed to analyze the impact of our claims management strategies(2); •The change in fair value of insurance contracts for which we have elected the fair value option(1) has been removed to support comparability between the two acquisition years for which we elected the fair value option in reserves assumed and the acquisition years for which we did not make this election (specifically, this election was only made in the 2017 and 2018 acquisition years and the election of such option is irrevocable); and •The amortization of fair value adjustments are non-cash charges that obscure our trends on a consistent basis. We include our performance in managing claims and estimated future expenses on our defendant A&E liabilities because such performance is relevant to assessing our claims management strategies even though such liabilities are not included within the loss reserves. We use this measure to assess the performance of our claim strategies and part of the performance assessment of our past acquisitions. | ||||||||||||
Adjusted prior period development (numerator) | Prior period net incurred losses and LAE, adjusted to: Remove: -Legacy Underwriting(2) operations -amortization of fair value adjustments, -change in fair value of insurance contracts for which we have elected the fair value option (1), and Add: -the reduction/(increase) in estimates of net ultimate liabilities and reduction in estimated future expenses of our defendant A&E liabilities. | |||||||||||||
Adjusted net loss reserves (denominator) | Net losses and LAE, adjusted to: Remove: -Legacy Underwriting(2) net loss reserves -current period net loss reserves -net fair value adjustments associated with the acquisition of companies, -the fair value adjustments for contracts for which we have elected the fair value option (1) and Add: -net nominal defendant A&E liability exposures and estimated future expenses. | |||||||||||||
| Adjusted total investment return (%) | Adjusted total investment return (dollars) recognized in earnings for the applicable period divided by period average adjusted total investable assets. | Provides a key measure of the return generated on the capital held in the business and is reflective of our investment strategy. Provides a consistent measure of investment returns as a percentage of all assets generating investment returns. We adjust our investment returns to eliminate the impact of the change in fair value of fixed maturities (both credit spreads and interest rates), as we typically hold most of these investments until the earlier of maturity or used to fund any settlement of related liabilities which are generally recorded at cost. | ||||||||||||
Adjusted total investment return ($) (numerator) | Total investment return (dollars), adjusted for: -fair value changes in fixed maturities, trading and funds held-directly managed; and -unrealized (gains) losses on fixed maturities, AFS included within OCI, net of reclassification adjustments and excluding foreign exchange. | |||||||||||||
Adjusted average aggregate total investable assets (denominator) | Total average investable assets, adjusted for: -net unrealized (gains) losses on fixed maturities, AFS included within AOCI -fair value changes in fixed maturities, trading and funds held-directly managed | |||||||||||||
(1) Comprises the discount rate and risk margin components.
(2) As of January 1, 2024, not applicable. Refer to Note 2 - "Segment Information" of our Quarterly Report on Form 10-Q for the period ended March 31, 2024
(3) The reinsurance contractual arrangements (including the Capacity Lease Agreement) were settled during the second quarter of 2023. Other than the settlement of these arrangements, we did not record any other transactions in the Legacy Underwriting segment in 2023.
Enstar Group Limited | 2024 Press Release 12
Reconciliation of GAAP to Non-GAAP Measures
The table below presents a reconciliation of BVPS to Fully Diluted BVPS*:
| March 31, 2024 | December 31, 2023 | |||||||||||||||||||||||||||||||||||||
Equity (1) | Ordinary Shares | Per Share Amount | Equity (1) | Ordinary Shares | Per Share Amount | |||||||||||||||||||||||||||||||||
| (in millions of U.S. dollars, except share and per share data) | ||||||||||||||||||||||||||||||||||||||
| Book value per ordinary share | $ | 5,122 | 14,658,801 | $ | 349.41 | $ | 5,025 | 14,631,055 | $ | 343.45 | ||||||||||||||||||||||||||||
| Non-GAAP adjustment: | ||||||||||||||||||||||||||||||||||||||
| Share-based compensation plans | 338,576 | 292,190 | ||||||||||||||||||||||||||||||||||||
| Fully diluted book value per ordinary share* | $ | 5,122 | 14,997,377 | $ | 341.53 | $ | 5,025 | 14,923,245 | $ | 336.72 | ||||||||||||||||||||||||||||
(1) Equity comprises Enstar ordinary shareholders' equity, which is calculated as Enstar shareholders' equity less preferred shares ($510 million) prior to any non-GAAP adjustments.
The table below presents a reconciliation of ROE to Adjusted ROE* and Annualized ROE to Annualized Adjusted ROE*:
| Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
| March 31, 2024 | March 31, 2023 | ||||||||||||||||||||||||||||||||||||||||||||||
Net (loss) earnings (1) | Opening equity (1) (2) | (Adj) ROE | Annualized (Adj) ROE | Net (loss) earnings (1) | Opening equity (1) | (Adj) ROE | Annualized (Adj) ROE | ||||||||||||||||||||||||||||||||||||||||
| (in millions of U.S. dollars) | |||||||||||||||||||||||||||||||||||||||||||||||
Net (loss) earnings/Opening equity/ROE/Annualized ROE (1) | $ | 119 | $ | 5,025 | 2.4 | % | 9.5 | % | $ | 424 | $ | 4,464 | 9.5 | % | 38.0 | % | |||||||||||||||||||||||||||||||
| Non-GAAP adjustments: | |||||||||||||||||||||||||||||||||||||||||||||||
| Remove: | |||||||||||||||||||||||||||||||||||||||||||||||
Net realized losses on fixed maturities, AFS (2) / Cumulative fair value changes to fixed maturities, AFS (3) | 6 | 380 | 18 | 647 | |||||||||||||||||||||||||||||||||||||||||||
Fair value changes on fixed maturities, trading (2) / Fair value changes on fixed maturities, trading (3) | 14 | 234 | (40) | 400 | |||||||||||||||||||||||||||||||||||||||||||
Fair value changes on funds held - directly managed (2) / Fair value changes on funds held - directly managed (3) | 5 | 111 | (19) | 780 | |||||||||||||||||||||||||||||||||||||||||||
Change in fair value of insurance contracts for which we have elected the fair value option / Fair value of insurance contracts for which we have elected the fair value option (4) | (4) | (246) | 20 | (294) | |||||||||||||||||||||||||||||||||||||||||||
| Amortization of fair value adjustments / Fair value adjustments | 3 | (107) | 3 | (124) | |||||||||||||||||||||||||||||||||||||||||||
Tax effects of adjustments (5) | (2) | — | (3) | — | |||||||||||||||||||||||||||||||||||||||||||
Adjustments attributable to noncontrolling interests (6) | — | — | (2) | — | |||||||||||||||||||||||||||||||||||||||||||
| Adjusted operating (loss) income/Adjusted opening equity/Adjusted ROE/Annualized adjusted ROE* | $ | 141 | $ | 5,397 | 2.6 | % | 10.5 | % | $ | 401 | $ | 5,873 | 6.8 | % | 27.3 | % | |||||||||||||||||||||||||||||||
(1) Net income (loss) comprises net income (loss) attributable to Enstar ordinary shareholders, prior to any non-GAAP adjustments. Opening equity comprises Enstar ordinary shareholders' equity, which is calculated as opening Enstar shareholders' equity less preferred shares ($510 million), prior to any non-GAAP adjustments.
(2) Net realized gains (losses) on fixed maturities, AFS are included in net realized gains (losses) in our condensed consolidated statements of operations. Fair value changes in our fixed maturities, trading and funds held - directly managed are included in fair value changes in trading securities, funds held and other investments in our condensed consolidated statements of operations.
(3) Our fixed maturities are held directly on our balance sheet and also within the "Funds held" balance.
(4) Comprises the discount rate and risk margin components.
(5) Represents an aggregation of the tax expense or benefit associated with the specific country to which the pre-tax adjustment relates, calculated at the applicable jurisdictional tax rate.
Enstar Group Limited | 2024 Press Release 13
(6) Represents the impact of the adjustments on the net income (loss) attributable to noncontrolling interests associated with the specific subsidiaries to which the adjustments relate.
*Non-GAAP measure.
The tables below present a reconciliation of RLE to Adjusted RLE*:
| Three Months Ended | As of | Three Months Ended | ||||||||||||||||||||||||||||||
| March 31, 2024 | March 31, 2024 | December 31, 2024 | March 31, 2024 | March 31, 2024 | ||||||||||||||||||||||||||||
| RLE / PPD | Net loss reserves | Net loss reserves | Average net loss reserves | RLE % | ||||||||||||||||||||||||||||
| (in millions of U.S. dollars) | ||||||||||||||||||||||||||||||||
| PPD/net loss reserves/RLE % | $ | 24 | $ | 10,827 | $ | 11,585 | $ | 11,206 | 0.2 | % | ||||||||||||||||||||||
| Non-GAAP adjustments for expenses (income): | ||||||||||||||||||||||||||||||||
| Net loss reserves - current period | — | (5) | — | (3) | ||||||||||||||||||||||||||||
| Amortization of fair value adjustments / Net fair value adjustments associated with the acquisition of companies | 3 | 103 | 107 | 105 | ||||||||||||||||||||||||||||
Changes in fair value - fair value option / Net fair value adjustments for contracts for which we have elected the fair value option (1) | (4) | 249 | 246 | 248 | ||||||||||||||||||||||||||||
| Change in estimate of net ultimate liabilities - defendant A&E / Net nominal defendant A&E liabilities | — | 516 | 527 | 522 | ||||||||||||||||||||||||||||
| Reduction in estimated future expenses - defendant A&E / Estimated future expenses - defendant A&E | 1 | 32 | 33 | 33 | ||||||||||||||||||||||||||||
| Adjusted PPD/Adjusted net loss reserves/Adjusted RLE %* | $ | 24 | $ | 11,722 | $ | 12,498 | $ | 12,111 | 0.2 | % | ||||||||||||||||||||||
| Three Months Ended | As of | Three Months Ended | ||||||||||||||||||||||||||||||
| March 31, 2023 | March 31, 2023 | December 31, 2023 | March 31, 2023 | March 31, 2023 | ||||||||||||||||||||||||||||
| RLE / PPD | Net loss reserves | Net loss reserves | Average net loss reserves | RLE % | ||||||||||||||||||||||||||||
| (in millions of U.S. dollars) | ||||||||||||||||||||||||||||||||
| PPD/net loss reserves/RLE % | $ | 10 | $ | 11,226 | $ | 12,011 | $ | 11,619 | 0.1 | % | ||||||||||||||||||||||
| Non-GAAP adjustments for expenses (income): | ||||||||||||||||||||||||||||||||
| Net loss reserves - current period | — | (9) | — | (5) | ||||||||||||||||||||||||||||
| Legacy Underwriting | — | — | (139) | (70) | ||||||||||||||||||||||||||||
| Amortization of fair value adjustments / Net fair value adjustments associated with the acquisition of companies | 3 | 121 | 124 | 123 | ||||||||||||||||||||||||||||
Changes in fair value - fair value option / Net fair value adjustments for contracts for which we have elected the fair value option (1) | 20 | 278 | 294 | 286 | ||||||||||||||||||||||||||||
| Change in estimate of net ultimate liabilities - defendant A&E / Net nominal defendant A&E liabilities | 2 | 560 | 572 | 566 | ||||||||||||||||||||||||||||
| Reduction in estimated future expenses - defendant A&E / Estimated future expenses - defendant A&E | 1 | 34 | 35 | 35 | ||||||||||||||||||||||||||||
| Adjusted PPD/Adjusted net loss reserves/Adjusted RLE %* | $ | 36 | $ | 12,210 | $ | 12,897 | $ | 12,554 | 0.3 | % | ||||||||||||||||||||||
(1) Comprises the discount rate and risk margin components.
*Non-GAAP measure.
Enstar Group Limited | 2024 Press Release 14
The tables below present a reconciliation of our Annualized TIR to our Annualized Adjusted TIR*:
| Three Months Ended | |||||||||||
| March 31, 2024 | March 31, 2023 | ||||||||||
| (in millions of U.S. dollars) | |||||||||||
| Net investment income | $ | 160 | $ | 156 | |||||||
| Net realized losses | (6) | (18) | |||||||||
| Fair value changes | 85 | 206 | |||||||||
| (Loss) income from equity method investments | (5) | 11 | |||||||||
| Other comprehensive income: | |||||||||||
| Unrealized (losses) gains on fixed maturities, AFS, net of reclassification adjustments excluding foreign exchange | (12) | 87 | |||||||||
| TIR ($) | $ | 222 | $ | 442 | |||||||
| Non-GAAP adjustment: | |||||||||||
| Net realized losses (gains) on fixed maturities, AFS and fair value changes in trading and funds held - directly managed | $ | 25 | $ | (41) | |||||||
| Unrealized losses (gains) on fixed maturities, AFS, net of reclassification adjustments excluding foreign exchange | 12 | (87) | |||||||||
| Adjusted TIR ($)* | $ | 259 | $ | 314 | |||||||
| Total investments | $ | 16,917 | $ | 16,630 | |||||||
| Cash and cash equivalents, including restricted cash and cash equivalents | 760 | 1,143 | |||||||||
| Total investable assets | $ | 17,677 | $ | 17,773 | |||||||
Average aggregate invested assets, at fair value (1) | 18,021 | 18,615 | |||||||||
Annualized TIR % (2) | 4.9 | % | 9.5 | % | |||||||
| Non-GAAP adjustment: | |||||||||||
| Net unrealized losses on fixed maturities, AFS included within AOCI and fair value changes on fixed maturities, trading and funds held - directly managed | 789 | 994 | |||||||||
| Adjusted investable assets* | $ | 18,466 | $ | 18,767 | |||||||
Adjusted average aggregate invested assets, at fair value* (3) | $ | 18,778 | $ | 20,020 | |||||||
Annualized adjusted TIR %* (4) | 5.5 | % | 6.3 | % | |||||||
(1) This amount is a two period average of the total investable assets for the three months ended March 31, 2024 and 2023 as presented above, and is comprised of amounts disclosed in our quarterly and annual U.S. GAAP consolidated financial statements.
(2) Annualized TIR % is calculated by dividing the annualized TIR ($) by average aggregate invested assets, at fair value.
(3) This amount is a two period average of the adjusted investable assets* for the three months ended March 31, 2024 and 2023 as presented above.
(4) Annualized adjusted TIR %* is calculated by dividing the annualized adjusted TIR* ($) by adjusted average aggregate invested assets, at fair value*.
*Non-GAAP measure.
Enstar Group Limited | 2024 Press Release 15
Enstargroup.com Enstargroup.com Realising Value Investor Financial Supplement March 31, 2024 ENSTAR GROUP LIMITED
| enstargroup.com 2 Table of Contents Page Explanatory Notes 3 Financial Highlights 5 Consolidated Results by Segment 6 Capital Position & Credit Ratings 8 Non-GAAP Measures 9 Reconciliation to Fully Diluted Book Value per Share 11 Reconciliation to Adjusted Return on Equity 12 Reconciliation to Adjusted Run-off Liability Earnings 13 Reconciliation to Adjusted Total Investment Return 14 Investment Composition 15
| enstargroup.com 3 Explanatory Notes About Enstar Enstar is a NASDAQ-listed leading global (re)insurance group that offers capital release solutions through its network of group companies in Bermuda, the United States, the United Kingdom, Continental Europe and Australia. A market leader in completing legacy acquisitions, Enstar has acquired over 115 companies and portfolios since its formation. For further information about Enstar, see www.enstargroup.com. Basis of Presentation In this Investor Financial Supplement, the terms "we," "us," "our," "Enstar," or "the Company" refer to Enstar Group Limited and its consolidated subsidiaries. All information contained herein is unaudited. Unless otherwise noted, amounts are in millions of U.S. Dollars, except for share and per share amounts. This Investor Financial Supplement is being provided for informational purposes only. It should be read in conjunction with documents filed by Enstar with the U.S. Securities and Exchange Commission, including its Annual Reports on Form 10-K and its Quarterly Reports on Form 10-Q. Non-GAAP Financial Measures In addition to our key financial measures presented in accordance with GAAP, we present other non-GAAP financial measures that we use to manage our business, compare our performance against prior periods and against our peers, and as performance measures in our incentive compensation program. These non-GAAP financial measures provide an additional view of our operational performance over the long-term and provide the opportunity to analyze our results in a way that is more aligned with the manner in which our management measures our underlying performance. The presentation of these non-GAAP financial measures, which may be defined and calculated differently by other companies, is used to enhance the understanding of certain aspects of our financial performance. It is not meant to be considered in isolation, superior to, or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. Some of the adjustments reflected in our non-GAAP measures are recurring items, such as the exclusion of adjustments to fair value changes and net realized (gains)/ losses on fixed maturities recognized in our statements of operations, the fair value of certain of our loss reserve liabilities for which we have elected the fair value option, and the amortization of fair value adjustments. Management makes these adjustments in assessing our performance so that the changes in fair value due to interest rate movements, which are applied to some but not all of our assets and liabilities as a result of preexisting accounting elections, do not impair comparability across reporting periods. It is important for the readers of our periodic filings to understand that these items will recur from period to period. However, we exclude these items for the purpose of presenting a comparable view across reporting periods of the impact of our underlying claims management and investments without the effect of interest rate fluctuations on assets that we anticipate to hold to maturity and non-cash changes to the fair value of our reserves. Similarly, our non-GAAP measures reflect the exclusion of certain items that we deem to be nonrecurring, unusual or infrequent when the nature of the charge or gain is such that it is not reasonably likely that such item may recur within two years, nor was there a similar charge or gain in the preceding two years. This includes adjustments related to bargain purchase gains on acquisitions of businesses, net gains or losses on sales of subsidiaries, net assets of held for sale or disposed subsidiaries classified as discontinued operations, and other items that we separately disclose. Refer to pages 9 to 14 for further details.
4 Explanatory Notes (continued) Investment Composition In certain instances, U.S. GAAP requires, in part, that invested assets be classified based upon the legal form of the investment which may not correspond to management’s view of the underlying economic exposure. For example: 1. Enstar has certain investments in public shares of exchange traded funds (“ETFs”) where the underlying exposure of the ETF is investment grade fixed maturities, and Enstar also has certain privately held equities which management evaluates based on the underlying economic exposures. U.S. GAAP requires that these investments be classified as “Equities”. 2. Enstar has certain private equity funds that are collectively held in a limited partnership, which management evaluates based on the nature of the underlying investments within these funds. U.S. GAAP requires that the investment be classified as “Private equity funds” within “Other Investments”. Where relevant, we have disclosed the underlying economic exposure of our investments in order to be consistent with the manner in which management views the underlying portfolio composition. Refer to pages 15 and 16 for further details. Cautionary Statement This Investor Financial Supplement contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements regarding the intent, belief or current expectations of Enstar and its management team. Investors are cautioned that any such forward- looking statements speak only as of the date they are made, are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors. Important risk factors regarding Enstar can be found under the heading "Risk Factors" in our filings with the Securities and Exchange Commission, including our Annual Reports on Form 10-K and our Quarterly Reports on Form 10- Q. Furthermore, Enstar undertakes no obligation to update any written or oral forward-looking statements or publicly announce any updates or revisions to any of the forward-looking statements contained herein, to reflect any change in its expectations with regard thereto or any change in events, conditions, circumstances or assumptions underlying such statements, except as required by law.
| enstargroup.com 5 Three Months Ended March 31, 2024 March 31, 2023 Key Income Metrics ROE 2.4 % 9.5 % Annualized ROE 9.5 % 38.0 % Adjusted ROE (1) 2.6 % 6.8 % Annualized adjusted ROE (1) 10.5 % 27.3 % Basic net earnings per share $ 8.13 $ 24.97 Diluted net earnings per share $ 8.02 $ 24.79 Key Run-off Metrics Average net loss reserves $ 11,206 $ 11,619 Run-off liability earnings (“RLE”) 0.2 % 0.1 % Average adjusted net loss reserves (1) $ 12,111 $ 12,554 Adjusted RLE (1) 0.2 % 0.3 % Key Investment Return Metrics Average aggregate invested assets $ 18,021 $ 18,615 Annualized total investment return (“TIR”) 4.9 % 9.5 % Annualized investment book yield 4.36 % 3.58 % (Loss) income from equity method investments $ (5) $ 11 Adjusted average aggregate invested assets (1) $ 18,778 $ 20,020 Annualized adjusted TIR (1) 5.5 % 6.3 % Share Repurchases Ordinary shares repurchased: Shares — 1,597,712 Cost $ — $ 341 Average price per share $ — $ 213.13 As of March 31, 2024 December 31, 2023 Key Shareholder Metrics Ordinary shareholder’s equity $ 5,122 $ 5,025 Total Enstar shareholders’ equity $ 5,632 $ 5,535 Book value per ordinary share (“BVPS”) $ 349.41 $ 343.45 Fully diluted BVPS (“FDBVPS”) (1) $ 341.53 $ 336.72 Change in FDBVPS 1.4 % 30.0 % Total ordinary shares outstanding 14,658,801 14,631,055 Fully diluted ordinary shares outstanding 14,997,377 14,923,245 Key Balance Sheet Metrics Total assets $ 20,265 $ 20,913 Debt obligations $ 1,832 $ 1,831 Total liabilities $ 14,519 $ 15,265 Total investable assets to ordinary shareholders’ equity 3.45x 3.63x Total net loss reserves to ordinary shareholders’ equity 2.11x 2.31x Debt to total capitalization attributable to Enstar 24.5 % 24.9 % Financial Highlights (1) Non-GAAP financial measure, refer to pages 9 to 14 for explanatory notes and a reconciliation to the most directly comparable GAAP measure.
| enstargroup.com 6 Consolidated Results by Segment - Q1 2024 Three Months Ended March 31, 2024 Run-off Investments Corporate and other (1)(2) Total REVENUES Net premiums earned $ 11 $ — $ — $ 11 Net investment income — 160 — 160 Net realized losses — (6) — (6) Fair value changes in trading securities, funds held and other investments — 85 — 85 Other income (expense) 3 — (3) — Total revenues 14 239 (3) 250 EXPENSES Net incurred losses and loss adjustment expenses Current period 5 — — 5 Prior period (23) — (1) (24) Total net incurred losses and loss adjustment expenses (18) — (1) (19) Amortization of net deferred charge assets — — 30 30 Acquisition costs 1 — — 1 General and administrative expenses 42 10 35 87 Total expenses 25 10 64 99 (LOSS) INCOME BEFORE INTEREST EXPENSE, FOREIGN EXCHANGE AND INCOME TAXES (11) 229 (67) 151 Loss from equity method investments — (5) — (5) SEGMENT (LOSS) INCOME $ (11) $ 224 (67) 146 Interest expense (22) (22) Net foreign exchange gains 9 9 Income tax expense (5) (5) NET (LOSS) INCOME ATTRIBUTABLE TO ENSTAR (85) 128 Dividends on preferred shares (9) (9) NET (LOSS) INCOME ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS $ (94) $ 119 (1) Effective January 1, 2024, Assumed Life and Legacy Underwriting were determined to no longer meet the definition of reportable segments and their residual income and loss activities were prospectively included in Corporate and other activities. Activities prior to January 1, 2024 are recorded in their respective segments. (2) Other income (expense) for corporate and other activities includes the amortization of fair value adjustments associated with the acquisition of DCo, LLC (“DCo”) and Morse TEC LLC (“Morse TEC”). Net incurred losses and loss adjustment expenses for corporate and other activities includes fair value adjustments associated with the acquisition of companies and the changes in the discount rate and risk margin components of the fair value of liabilities related to our assumed retroactive reinsurance agreements for which we have elected the fair value option.
| enstargroup.com 7 Consolidated Results by Segment - Q1 2023 Three Months Ended March 31, 2023 Run-off Assumed Life (1) Investments Corporate and other (2) Total REVENUES Net premiums earned $ 8 $ — $ — $ — $ 8 Net investment income — — 156 — 156 Net realized losses — — (18) — (18) Fair value changes in trading securities, funds held and other investments — — 206 — 206 Other income 5 275 — — 280 Total revenues 13 275 344 — 632 EXPENSES Net incurred losses and loss adjustment expenses Current period 10 — — — 10 Prior period (33) — — 23 (10) Total net incurred losses and loss adjustment expenses (23) — — 23 — Amortization of net deferred charge assets — — — 17 17 Acquisition costs 2 — — — 2 General and administrative expenses 39 — 11 39 89 Total expenses 18 — 11 79 108 (LOSS) INCOME BEFORE INTEREST EXPENSE, FOREIGN EXCHANGE AND INCOME TAXES (5) 275 333 (79) 524 Income from equity method investments — — 11 — 11 SEGMENT (LOSS) INCOME $ (5) $ 275 $ 344 (79) 535 Interest expense (23) (23) Net foreign exchange gains 6 6 Income tax benefit 1 1 NET (LOSS) INCOME (95) 519 Net income attributable to noncontrolling interests (86) (86) NET (LOSS) INCOME ATTRIBUTABLE TO ENSTAR (181) 433 Dividends on preferred shares (9) (9) NET (LOSS) INCOME ATTRIBUTABLE TO ENSTAR ORDINARY SHAREHOLDERS $ (190) $ 424 (1) Effective January 1, 2024, Assumed Life and Legacy Underwriting were determined to no longer meet the definition of reportable segments and their residual income and loss activities were prospectively included in Corporate and other activities. Activities prior to January 1, 2024 are recorded in their respective segments. In addition, Legacy Underwriting had no revenue or income activity for the three months ended March 31, 2023 and therefore is excluded from the table above. (2) Other income (expense) for corporate and other activities includes the amortization of fair value adjustments associated with the acquisition of DCo and Morse TEC. Net incurred losses and loss adjustment expenses for corporate and other activities includes fair value adjustments associated with the acquisition of companies and the changes in the discount rate and risk margin components of the fair value of liabilities related to our assumed retroactive reinsurance agreements for which we have elected the fair value option.
| enstargroup.com 8 Capital Position & Credit Ratings Credit ratings (1) Standard and Poor’s Fitch Ratings Long-term issuer BBB+ (Outlook: Stable) BBB+ (Outlook: Stable) 2029 Senior Notes BBB+ BBB 2031 Senior Notes BBB BBB 2040 and 2042 Junior Subordinated Notes BBB- BBB- Series D and E Preferred Shares BBB- BBB- (1) Credit ratings are provided by third parties, Standard & Poor’s and Fitch Ratings, and are subject to certain limitations and disclaimers. For information on these ratings, refer to the rating agencies’ websites and other publications. Total Capitalization Attributable to Enstar $7,464 $7,366 $5,122 $5,025 $510 $510 $1,832 $1,831 24.5% 24.9% 31.4% 31.8% Debt and Series D and E Preferred Shares to total capitalization attributable to Enstar Debt to total capitalization attributable to Enstar Debt obligations Series D and E Preferred Shares Ordinary shareholders' equity March 31, 2024 December 31, 2023 Total Capitalization $7,578 $7,479 $5,122 $5,025 $510 $510 $114 $113 $1,832 $1,831 24.2% 24.5% 30.9% 31.3% Debt and Series D and E Preferred Shares to total capitalization Debt to total capitalization Debt obligations NCI Series D and E Preferred Shares Ordinary shareholders' equity March 31, 2024 December 31, 2023 Agency ratings are not a recommendation to buy, sell or hold any of our securities and may be revised or withdrawn at any time by the issuing organization. Each agency's rating should be evaluated independently of any other agency's rating. For information on risks related to our credit ratings, refer to "Item 1A. Risk Factors - Risks Relating to Liquidity and Capital Resources" and "Item 1A. Risk Factors - Risks Relating to Ownership of our Shares" in our Annual Report on Form 10-K for the year ended December 31, 2023.
9 Non-GAAP Measures Non-GAAP Measure Definition Purpose of Non-GAAP Measure over GAAP Measure Fully diluted book value per ordinary share Total Enstar ordinary shareholders' equity Divided by Number of ordinary shares outstanding, adjusted for: -the ultimate effect of any dilutive securities (which include restricted shares, restricted share units, directors’ restricted share units and performance share units) on the number of ordinary shares outstanding Increases the number of ordinary shares to reflect the exercise of equity awards granted but not yet vested as, over the long term, this presents both management and investors with a more economically accurate measure of the realizable value of shareholder returns by factoring in the impact of share dilution. We use this non-GAAP measure in our incentive compensation program. Adjusted return on equity (%) Adjusted operating income (loss) attributable to Enstar ordinary shareholders divided by adjusted opening Enstar ordinary shareholder's equity Calculating the operating income (loss) as a percentage of our adjusted opening Enstar ordinary shareholders' equity provides a more consistent measure of the performance of our business by enabling comparison between the financial periods presented. We eliminate the impact of fair value changes and net realized (gains) losses on fixed maturities and funds held-directly managed and the change in fair value of insurance contracts for which we have elected the fair value option, as: • we typically hold most of our fixed maturities until the earlier of maturity or the time that they are used to fund any settlement of related liabilities which are generally recorded at cost; and • removing the fair value option improves comparability since there are limited acquisition years for which we elected the fair value option. Therefore, we believe that excluding their impact on our net income improves comparability of our core operational performance across periods. We include fair value adjustments as non-GAAP adjustments to the adjusted operating income (loss) attributable to Enstar ordinary shareholders as they are non-cash charges that are not reflective of the impact of our claims management strategies on our loss portfolios. We eliminate the net gain (loss) on the purchase and sales of subsidiaries and net income from discontinued operations, as these items are not indicative of our ongoing operations. We use this non-GAAP measure in our incentive compensation program. Adjusted operating income (loss) attributable to Enstar ordinary shareholders (numerator) Net income (loss) attributable to Enstar ordinary shareholders, adjusted for: -fair value changes and net realized (gains) losses on fixed maturities and funds held- directly managed, -change in fair value of insurance contracts for which we have elected the fair value option (1), -amortization of fair value adjustments, -net gain/loss on purchase and sales of subsidiaries (if any), -net income from discontinued operations (if any), -tax effects of adjustments, and -adjustments attributable to noncontrolling interests Adjusted opening Enstar ordinary shareholders' equity (denominator) Opening Enstar ordinary shareholders' equity, less: -fair value changes on fixed maturities and funds held-directly managed, -fair value of insurance contracts for which we have elected the fair value option (1), -fair value adjustments, and -net assets of held for sale or disposed subsidiaries classified as discontinued operations (if any) Adjusted total investment return (%) Adjusted total investment return (dollars) recognized in net income for the applicable period divided by period average adjusted total investable assets. Provides a key measure of the return generated on the capital held in the business and is reflective of our investment strategy. Provides a consistent measure of investment returns as a percentage of all assets generating investment returns. We adjust our investment returns to eliminate the impact of the change in fair value of fixed maturities (both credit spreads and interest rates), as we typically hold most of these investments until the earlier of maturity or used to fund any settlement of related liabilities which are generally recorded at cost. Adjusted total investment return ($) (numerator) Total investment return (dollars), adjusted for: -fair value changes in fixed maturities, trading and funds held-directly managed; and -unrealized (gains) losses on fixed maturities, AFS included within OCI, net of reclassification adjustments and excluding foreign exchange. Adjusted average aggregate total investable assets (denominator) Total average investable assets, adjusted for: -net unrealized (gains) losses on fixed maturities, AFS included within AOCI -fair value changes on fixed maturities, trading and funds held - directly managed (1) Comprises the discount rate and risk margin components.
| enstargroup.com 10 Non-GAAP Measures (continued) Non-GAAP Measure Definition Purpose of Non-GAAP Measure over GAAP Measure Adjusted run-off liability earnings (%) Adjusted PPD divided by average adjusted net loss reserves. Calculating the RLE as a percentage of our adjusted average net loss reserves provides a more meaningful and comparable measurement of the impact of our claims management strategies on our loss portfolios across acquisition years and also to our overall financial periods. We use this measure to evaluate the impact of our claims management strategies because it provides visibility into our ability to settle our claims obligations for amounts less than our initial estimate at the point of acquiring the obligations. The following components of periodic recurring net incurred losses and LAE and net loss reserves are not considered key components of our claims management performance for the following reasons: • Prior to the settlement of the contractual arrangements, the results of our Legacy Underwriting segment were economically transferred to a third party primarily through use of reinsurance and a Capacity Lease Agreement(3); as such, the results were not a relevant contribution to Adjusted RLE, which is designed to analyze the impact of our claims management strategies(2); • The change in fair value of insurance contracts for which we have elected the fair value option(1) has been removed to support comparability between the two acquisition years for which we elected the fair value option in reserves assumed and the acquisition years for which we did not make this election (specifically, this election was only made in the 2017 and 2018 acquisition years and the election of such option is irrevocable); and • The amortization of fair value adjustments are non-cash charges that obscure our trends on a consistent basis. We include our performance in managing claims and estimated future expenses on our defendant A&E liabilities because such performance is relevant to assessing our claims management strategies even though such liabilities are not included within the loss reserves. We use this measure to assess the performance of our claim strategies and part of the performance assessment of our past acquisitions. Adjusted prior period development (numerator) Prior period net incurred losses and LAE, adjusted to: Remove: -Legacy Underwriting(2) operations -amortization of fair value adjustments, -change in fair value of insurance contracts for which we have elected the fair value option (1), and Add: -the reduction/(increase) in estimates of net ultimate liabilities and reduction in estimated future expenses of our defendant A&E liabilities. Adjusted net loss reserves (denominator) Net losses and LAE, adjusted to: Remove: -Legacy Underwriting(2) net loss reserves -current period net loss reserves -net fair value adjustments associated with the acquisition of companies, -the fair value adjustments for contracts for which we have elected the fair value option (1) and Add: -net nominal defendant A&E liability exposures and estimated future expenses. (1) Comprises the discount rate and risk margin components. (2) As of January 1, 2024, not applicable. Refer to Note 2 - "Segment Information" of our Form 10-Q or more detail. (3) The reinsurance contractual arrangements (including the Capacity Lease Agreement) were settled during the second quarter of 2023. Other than the settlement of these arrangements, we did not record any transactions in the Legacy Underwriting segment in 2023.
| enstargroup.com 11 Reconciliation to Fully Diluted Book Value Per Share As of March 31, 2024 December 31, 2023 Equity (1) Ordinary Shares Per Share Amount Equity (1) Ordinary Shares Per Share Amount Book value per ordinary share $ 5,122 14,658,801 $ 349.41 $ 5,025 14,631,055 $ 343.45 Non-GAAP adjustments: Share-based compensation plans 338,576 292,190 Fully diluted book value per ordinary share* $ 5,122 14,997,377 $ 341.53 $ 5,025 14,923,245 $ 336.72 (1) Equity comprises Enstar ordinary shareholders' equity, which is calculated as Enstar shareholders' equity less preferred shares ($510 million), prior to any non-GAAP adjustments. * Non-GAAP financial measure.
| enstargroup.com 12 Reconciliation to Adjusted Return on Equity - Q1 2024 and 2023 (1) Net (loss) earnings comprises net (loss) earnings attributable to Enstar ordinary shareholders, prior to any non-GAAP adjustments. Opening equity comprises Enstar ordinary shareholders' equity, which is calculated as opening Enstar shareholders' equity less preferred shares ($510 million), prior to any non-GAAP adjustments. (2) Represents the net realized and unrealized losses (gains) related to fixed maturity securities. Our fixed maturity securities are held directly on our balance sheet and also within the "Funds held - directly managed" balance. (3) Comprises the discount rate and risk margin components. (4) Represents an aggregation of the tax expense or benefit associated with the specific country to which the pre-tax adjustment relates, calculated at the applicable jurisdictional tax rate. (5) Represents the impact of the adjustments on the net earnings (loss) attributable to noncontrolling interests associated with the specific subsidiaries to which the adjustments relate. * Non-GAAP financial measure. (1) Net income (loss) comprises net income (loss) attributable to Enstar ordinary shareholders, prior to any non-GAAP adjustments. Opening equity comprises Enstar ordinary shareholders' equity, which is calculated as opening Enstar shareholders' equity less preferred shares ($510 million), prior to any non-GAAP adjustments. (2) Net realized gains (losses) on fixed maturities, AFS are included in net realized gains (losses) in our consolidated statements of operations. Fair value changes on fixed maturities, trading and funds held - directly managed are included in fair value changes in trading securities, funds held and other investments in in our consolidated statements of operations. (3) Our fixed maturities are held directly on our balance sheet and also within the "Funds held" balance. (4) Comprises the discount rate and risk margin components. (5) Represents an aggregation of the tax expense or benefit associated with the specific country to which the pre-tax adjustment relates, calculated at the applicable jurisdictional tax rate. (6) Represents the impact of the adjustments on the net income (loss) attributable to noncontrolling interests associated with the specific subsidiaries to which the adjustments relate. * Non-GAAP financial measure. Three Months Ended March 31, 2024 March 31, 2023 Net income (loss) (1) Opening equity (1) (Adj) ROE Annualized (Adj) ROE Net income (loss) (1) Opening equity (1) (Adj) ROE Annualized (Adj) ROE Net income/Opening equity/ROE(1) $ 119 $ 5,025 2.4 % 9.5 % $ 424 $ 4,464 9.5 % 38.0 % Non-GAAP adjustments for loss (gains): Net realized losses on fixed maturities, AFS (2) / Cumulative fair value changes to fixed maturities, AFS (3) 6 380 18 647 Fair value changes on fixed maturities, trading (2) / Fair value changes on fixed maturities, trading (3) 14 234 (40) 400 Fair value changes in funds held - directly managed (2) / Fair values changes on funds held - directly managed (3) 5 111 (19) 780 Change in fair value of insurance contracts for which we have elected the fair value option / Fair value of insurance contracts for which we have elected the fair value option (4) (4) (246) 20 (294) Amortization of fair value adjustments / Fair value adjustments 3 (107) 3 (124) Tax effects of adjustments (5) (2) — (3) — Adjustments attributable to noncontrolling interests (6) — — (2) — Adjusted net income/Adjusted opening equity/Adjusted ROE* $ 141 $ 5,397 2.6 % 10.5 % $ 401 $ 5,873 6.8 % 27.3 %
| enstargroup.com 13 Reconciliation to Adjusted Run-off Liability Earnings - Q1 2024 and 2023 Three Months Ended As of Three Months Ended March 31, 2023 March 31, 2023 December 31, 2022 March 31, 2023 March 31, 2023 RLE / PPD Net loss reserves Net loss reserves Average net loss reserves RLE % PPD/net loss reserves/RLE % $ 10 $ 11,226 $ 12,011 $ 11,619 0.1 % Non-GAAP adjustments for expenses (income): Net loss reserves incurred in the current period — (9) — (5) Legacy Underwriting — — (139) (70) Amortization of fair value adjustments / Net fair value adjustments associated with the acquisition of companies 3 121 124 123 Changes in fair value - fair value option / Net fair value adjustments for contracts for which we have elected the fair value option (1) 20 278 294 286 Change in estimate of net ultimate liabilities - defendant A&E / Net nominal defendant A&E liabilities 2 560 572 566 Reduction in estimated future expenses - defendant A&E / Estimated future expenses - defendant A&E 1 34 35 35 Adjusted PPD/Adjusted net loss reserves/Adjusted RLE %* $ 36 $ 12,210 $ 12,897 $ 12,554 0.3 % (1) Comprises the discount rate and risk margin components. * Non-GAAP financial measure. Three Months Ended As of Three Months Ended March 31, 2024 March 31, 2024 December 31, 2023 March 31, 2024 March 31, 2024 RLE / PPD Net loss reserves Net loss reserves Average net loss reserves RLE % PPD/net loss reserves/RLE % $ 24 $ 10,827 $ 11,585 $ 11,206 0.2 % Non-GAAP adjustments for expenses (income): Net loss reserves incurred in the current period — (5) — (3) Amortization of fair value adjustments / Net fair value adjustments associated with the acquisition of companies 3 103 107 105 Changes in fair value - fair value option / Net fair value adjustments for contracts for which we have elected the fair value option (1) (4) 249 246 248 Change in estimate of net ultimate liabilities - defendant A&E / Net nominal defendant A&E liabilities — 516 527 522 Reduction in estimated future expenses - defendant A&E / Estimated future expenses - defendant A&E 1 32 33 33 Adjusted PPD/Adjusted net loss reserves/Adjusted RLE %* $ 24 $ 11,722 $ 12,498 $ 12,111 0.2 %
| enstargroup.com 14 Reconciliation to Adjusted Total Investment Return Three Months Ended March 31, 2024 2023 Net investment income $ 160 $ 156 Net realized losses (6) (18) Fair value changes in trading securities, funds held and other investments 85 206 (Loss) income from equity method investments (5) 11 Other comprehensive income: Unrealized (losses) gains on fixed maturities, AFS, net of reclassification adjustments excluding foreign exchange (12) 87 TIR ($) $ 222 $ 442 Non-GAAP adjustments: Net realized losses (gains) on fixed maturities, AFS and fair value changes in trading and funds held - directly managed 25 (41) Unrealized losses (gains) on fixed maturities, AFS, net of reclassification adjustments excluding foreign exchange 12 (87) Adjusted TIR ($)* $ 259 $ 314 Total investments 16,917 16,630 Cash and cash equivalents, including restricted cash and cash equivalents 760 1,143 Total investable assets $ 17,677 $ 17,773 Average aggregate invested assets, at fair value (1) $ 18,021 $ 18,615 Annualized TIR % (2) 4.9 % 9.5 % Non-GAAP adjustment: Net unrealized losses on fixed maturities, AFS included within AOCI and fair value changes on fixed maturities, trading and funds held - directly managed 789 994 Adjusted investable assets* $ 18,466 $ 18,767 Adjusted average aggregate invested assets, at fair value* (3) $ 18,778 $ 20,020 Annualized adjusted TIR %* (4) 5.5 % 6.3 % (1) This amount is a two period average of the total investable assets for the three months ended March 31, 2024 and 2023, respectively, as presented above, and is comprised of amounts disclosed in our quarterly and annual U.S. GAAP consolidated financial statements. (2) Annualized TIR % is calculated by dividing the annualized TIR ($) by average aggregate invested assets, at fair value. (3) This amount is a two period average of the adjusted investable assets* for the three months ended March 31, 2024 and 2023, (4) Annualized adjusted TIR %* is calculated by dividing the annualized adjusted TIR* ($) by adjusted average aggregate invested assets, at fair value*. *Non-GAAP measure.
| enstargroup.com 15 Investment Composition - March 31, 2024 Other Investments Equities Cash (2) Funds Held Short-term and fixed maturities, trading and AFSMarch 31, 2024 Hedge Funds Fixed income funds Equity funds Private equity funds CLO equities CLO equity funds Private credit funds Real estate equity Other (1) Publicly traded equities Exchange- traded funds Privately held equities Short-term and fixed maturities, trading and AFS $ 6,955 39.4 % 6955 Funds held 4,880 27.6 % 103 63 4,714 — % 2.1 % — % — % — % — % — % — % — % — % 1.3 % — % — % 96.6 % — % Equities Privately held equities 344 1.9 % 47 297 Publicly traded equities 310 1.8 % 63 247 Exchange-traded funds 84 0.5 % 20 19 45 Total 738 4.2 % — % 8.5 % — % — % 2.7 % — % 6.4 % — % — % 33.5 % 2.6 % 40.2 % — % — % 6.1 % Other investments Private equity funds 1,706 9.7 % 1 1,293 105 69 207 13 12 6 Private credit funds 642 3.6 % 642 Hedge funds 559 3.2 % 472 87 Fixed income funds 550 3.1 % 550 Real estate debt fund 336 1.9 % 336 CLO equity funds 161 0.9 % 161 CLO equities 60 0.3 % 60 Equity funds 4 — % 4 Total 4,018 22.7 % 11.7 % 15.9 % — % 32.2 % 5.5 % — % 18.6 % 10.1 % 5.2 % 0.4 % 0.3 % 0.1 % — % — % — % Equity method investments 326 1.8 % Total investments 16,917 95.7 % Cash and cash equivalents (including restricted cash) 760 4.3 % 760 Total investable assets $ 17,677 100.0 % (1) Includes infrastructure in fund format. (2) Cash and cash equivalents.
| enstargroup.com 16 Investment Composition - December 31, 2023 Other Investments Equities December 31, 2023 Hedge Funds Fixed income funds Private equity funds CLO equities CLO equity funds Private credit funds Real estate equity Other(1) Publicly traded equities Exchange- traded funds Privately held equities Cash(2) Funds Held Short-term and fixed maturity investments, trading and AFS Short-term and fixed maturity investments, trading and AFS $ 7,274 39.9 % 7,274 Funds held 5,251 28.8 % 102 68 5,081 — % 1.9 % — % — % — % — % — % — % — % 1.3 % — % — % 96.8 % — % Equities Privately held equities 344 1.9 % 45 299 Publicly traded equities 275 1.5 % 55 220 Exchange-traded funds 82 0.4 % 18 20 44 Total 701 3.8 % — % 7.8 % — % 2.6 % — % 6.4 % — % — % 31.4 % 2.9 % 42.6 % — % — % 6.3 % Other investments Private equity funds 1,617 8.9 % 3 1,186 108 67 92 16 30 6 109 Private credit funds 625 3.4 % 625 Fixed income funds 605 3.3 % 605 Hedge funds 491 2.7 % 407 84 Real estate debt fund 269 1.5 % 269 CLO equity funds 182 1.0 % 182 CLO equities 60 0.3 % 60 Equity funds 4 — % 4 Total 3,853 21.1 % 10.5 % 18.0 % 30.8 % 6.3 % — % 19.0 % 8.7 % 2.4 % 0.5 % 0.8 % 0.2 % 2.8 % — % — % Equity method investments 334 1.8 % Total investments 17,413 95.5 % Cash and cash equivalents (including restricted cash) 830 4.5 % 830 Total investable assets $ 18,243 100.0 % (1) Infrastructure in fund format. (2) Cash and cash equivalents.