Author Topic: TSU - Trisura  (Read 14484 times)

snowball82

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TSU - Trisura
« on: February 15, 2019, 02:17:17 PM »
I bought a position in this microcap insurance company, a spinoff from Brookfield Asset Management (BAM). Current price is $ 26.97.

It is interesting to see they got 19 % return on equity in Canada and they have a plan to expand in US.

"Trisura Group is an international specialty insurance provider operating in surety, risk solutions, corporate insurance and reinsurance, and is trading on the Toronto Stock Exchange (TSX: TSU). Trisura Group has three principal regulated subsidiaries: Trisura Guarantee Insurance Company, Trisura International Insurance and Trisura Specialty Insurance Company (“Trisura US”).

Trisura Guarantee Insurance Company started writing business in Canada in 2006 and has a long track record of profitable operations.
Trisura International Insurance has operated as a reinsurance company for almost 15 years.
Trisura Specialty Insurance Company is currently being incorporated as an operating subsidiary in the U.S.
Trisura Group benefits from an experienced management team, strong distribution partners and a specialized and profitable business focus. Trisura plans to grow through strategic acquisitions and a multi-line, multi-jurisdictional platform while continuing to focus on our existing distribution network and increasing penetration in our existing product segments."


They released the Q4 :

TORONTO, Feb. 14, 2019 (GLOBE NEWSWIRE) -- Trisura Group Ltd. (“Trisura” or “Trisura Group”) (TSX: TSU), a leading international specialty insurance holding company, today announced financial results for the fourth quarter and year ended December 31, 2018.

David Clare, CEO of Trisura, stated, “We are very pleased with our fourth quarter and full year results for 2018. Strong underwriting and topline growth continued for our Canadian subsidiary, yielding industry leading returns. We continue to build momentum in our US fronting platform, binding 14 programs and generating over $50 million in gross premiums written in 2018.”

Highlights

Gross premiums written growth of 77% in Q4 2018 and 49% in full year 2018, driven by continued growth in our Canadian Specialty P&C business and strong momentum in our US Specialty business.
 
Net income in Q4 2018 of $1.6 million, an increase of $1.7 million over Q4 2017, and full year income of $8.6 million, an increase of $3.8 million (excluding Minority Interests) over 2017, driven by our Canadian Specialty P&C business. 
 
Consolidated ROE (trailing 12 months) of 6.9% at December 31, 2018, compared to 5.6% at September 30, 2018 and 4.1% at June 30, 2018.
 
Strong Q4 and full year results from our Canadian Specialty P&C business, achieving an 83.9% combined ratio in Q4 and an 86.3% combined ratio for the full year, driving a 19.1% ROE for the trailing 12 months. 
 
Basic and diluted EPS of $0.24 in Q4 2018 and $1.29 (basic) and $1.27 (diluted) in full year 2018.
 
Book value per share of $19.63, a 7.0% increase over December 2017.

https://globenewswire.com/news-release/2019/02/15/1725958/0/en/Trisura-Group-Reports-Fourth-Quarter-and-2018-Annual-Results.html

The annual report 2018 is available :

https://www.trisura.com/wp-content/uploads/2019/02/TGL-2018-Annual-Report.pdf

More content to come. Let start the discussion. Or the monologue.
« Last Edit: February 16, 2019, 01:43:58 AM by snowball82 »


Jurgis

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Re: TSU - Trisura
« Reply #1 on: February 15, 2019, 04:13:02 PM »
I bought some of this when it was spun off from BAM. I also got few shares in spinoff, but that was very tiny - my BAM position was not big.

I think the bull case is company growth now that it's free from parent. I think TRU may be acquired by Fairfax eventually - although I don't know if personalities involved make this more or less possible.

The risk is that pursuing growth they write policies too cheap. And that overall insurance business is not great at the time of low bond yields.
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netnet

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Re: TSU - Trisura
« Reply #2 on: February 15, 2019, 04:48:08 PM »
Returns in this space are totally driven by good management, so are the managers closer to the second coming of Ajit or Forest Gump?


obtuse_investor

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Re: TSU - Trisura
« Reply #3 on: February 15, 2019, 04:59:19 PM »
What’s the compensation structure for management?

The gold standard is Markel. Their bonus is based on a rolling 5 year average book value per share.
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snowball82

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Re: TSU - Trisura
« Reply #4 on: February 15, 2019, 06:18:33 PM »
I agree management is crucial here. They also have to add the right products for the right clients.

They seem to have many products :

https://www.trisura.com/products-by-industry

I'm also interested to know more about the new 14 programs in US. Please let us know if one of you find something. Together we can do much better due diligence.

snowball82

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Re: TSU - Trisura
« Reply #5 on: February 16, 2019, 01:15:21 AM »
Returns in this space are totally driven by good management, so are the managers closer to the second coming of Ajit or Forest Gump?

netnet

You set the bar very high with Ajit !

“When Ajit entered Berkshire’s office on a Saturday in 1986, he did not have a day’s experience in the insurance business. Nevertheless, Mike Goldberg, then our manager of insurance, handed him the keys to our small and struggling reinsurance business. With that move, Mike achieved sainthood: Since then, Ajit has created tens of billions of value for Berkshire shareholders. If there were ever to be another Ajit and you could swap me for him, don’t hesitate. Make the trade!”

He created tens of billions of value...not the same league. Tsu, traded at 1.4 time book value, is a less than $ 180 M marketcap.
« Last Edit: February 16, 2019, 01:48:58 AM by snowball82 »

snowball82

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Re: TSU - Trisura
« Reply #6 on: February 16, 2019, 01:24:19 AM »
What’s the compensation structure for management?

The gold standard is Markel. Their bonus is based on a rolling 5 year average book value per share.

I'm also interested to see the details. I guess the largest shareholder should look it too. Partners Value Investment LP owns 18,2 %.

https://globenewswire.com/news-release/2018/10/30/1639139/0/en/Partners-Value-Investments-LP-Acquires-Common-Shares-of-Trisura-Group-Ltd.html

« Last Edit: February 16, 2019, 01:45:53 AM by snowball82 »

spark411

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Re: TSU - Trisura
« Reply #7 on: February 16, 2019, 04:15:27 AM »
My position is based on three reasons. A) the insurance business if done right is a compounding machine  B) it's a microcap so the runway for growth is significant  C) management has experience, expectations, and backing of a firm 100x larger.

I have a simple question.   I have the hardest time finding the investor relations page for Trisura.   It seems that they change it. If anyone has it, please post.  Thank you!

EricSchleien

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Re: TSU - Trisura
« Reply #8 on: February 16, 2019, 07:32:38 AM »
Yes and David Clare was the former CFO of Partners Value Investments.

What’s the compensation structure for management?

The gold standard is Markel. Their bonus is based on a rolling 5 year average book value per share.

I'm also interested to see the details. I guess the largest shareholder should look it too. Partners Value Investment LP owns 18,2 %.

https://globenewswire.com/news-release/2018/10/30/1639139/0/en/Partners-Value-Investments-LP-Acquires-Common-Shares-of-Trisura-Group-Ltd.html

John Hjorth

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Re: TSU - Trisura
« Reply #9 on: February 16, 2019, 07:38:22 AM »
Here you go, spark.
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