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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): August 8, 2022
 
 
TIPTREE INC.
(Exact Name of Registrant as Specified in Charter)
 
   
Maryland   001-33549   38-3754322
(State or Other Jurisdiction
of Incorporation)
  (Commission
File Number)
  (I.R.S. Employer
Identification No.)
299 Park Avenue 13th Floor New York NY   10171
(Address of Principal Executive Offices)   (Zip Code)

(212) 446-1400
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

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
Common Stock, par value $0.001 per share TIPT NASDAQ  Capital Market




Indicate by check mark whether the registrant is an emerging growth company as defined in 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 August 8, 2022, Tiptree Inc. (the “Company” or “Tiptree”) issued a press release announcing its results of operations for the quarter ended June 30, 2022. A copy of the press release is furnished as Exhibit 99.1 hereto and incorporated herein by reference.

Item 7.01
Regulation FD Disclosure.

    Included in the press release furnished as Exhibit 99.1 was an announcement that the board of directors of the Company has declared a cash dividend of $0.04 per share to Tiptree’s stockholders, with a record date of August 22, 2022 and a payment date of August 29, 2022.

    On August 8, 2022, the Company posted an investor presentation dated August 2022 on the Investor Resources section of www.tiptreeinc.com. The investor presentation is furnished as Exhibit 99.2 to this Form 8-K and incorporated herein by reference. Tiptree’s website is not intended to function as a hyperlink, and the information contained on such website is not a part of this Form 8-K.

    The information in Items 2.02 and 7.01 of this Current Report on Form 8-K, including the information contained in Exhibits 99.1 and 99.2, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section. Furthermore, the information in Items 2.02 and 7.01 of this Current Report on Form 8-K, including the information contained in Exhibits 99.1 and 99.2, shall not be deemed to be incorporated by reference into the filings of the Company under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) List of Exhibits:
99.1
99.2
104
Cover Page Interactive Data File (formatted as Inline XBRL).






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.
 
TIPTREE INC.
Date:
August 8, 2022
By: /s/ Jonathan Ilany
Name: Jonathan Ilany
Title: Chief Executive Officer


EX-99.1 2 ex991er-6302022.htm EX-99.1 Document

Exhibit 99.1

tiptree_logoxupdateda.jpg
TIPTREE REPORTS SECOND QUARTER 2022 RESULTS
New York, New York - August 8, 2022 - Tiptree Inc. (NASDAQ:TIPT) (“Tiptree” or the “Company”), today announced its financial results for the three and six months ended June 30, 2022. 

Second Quarter 2022 Summary

•In June 2022, Tiptree closed the previously announced $200 million strategic investment in Fortegra by Warburg Pincus. As part of the closing, $113 million of Tiptree’s corporate debt was repaid in full.

•Tiptree recognized a $63.2 million pre-tax gain in stockholders’ equity from the investment in Fortegra, which was partially offset by $39.6 million of tax expense associated with the tax deconsolidation of Fortegra. Of the total deferred tax liability, $25.5 million impacted net income with the remainder impacting stockholders’ equity directly.

•In the second quarter, we sold one dry bulk vessel for $21.5 million and signed definitive agreements to sell the remaining two dry bulk vessels for an aggregate of $46.2 million, representing an approximate 45% gain as compared to Q2’22 book value. The two dry bulk vessels under contract to sell are expected to close in Q3’22.

•Revenues for the quarter of $339.8 million, an increase of 13.4% from Q2'21 driven by growth in Fortegra’s specialty insurance lines and increased vessel revenues, partially offset by investment losses in 2022 compared to gains in 2021. Excluding investment gains and losses, revenues were up 16.1%.

•Net loss of $22.4 million compared to net income of $8.0 million in Q2'21, driven by the deferred tax liability associated with the Warburg Pincus investment and unrealized losses on investments as compared to gains in the prior year period, partially offset by growth in insurance and shipping operations.

•Adjusted net income of $14.0 million increased by 6.6% from $13.1 million in Q2'21, driven by growth in specialty insurance and shipping operations. Adjusted return on average equity was 12.3% for the quarter.

•The Company repurchased 89,543 shares in the quarter at an average price of $10.45 per share.

•Declared a dividend of $0.04 per share to stockholders of record on August 22, 2022 with a payment date of August 29, 2022.
Three Months Ended June 30, Six Months Ended June 30,
($ in thousands, except per share information) 2022 2021 2022 2021
Total revenues $ 339,843  $ 299,687  $ 664,746  $ 594,375 
Net income (loss) attributable to common stockholders $ (22,408) $ 7,969  $ (23,368) $ 36,550 
Diluted earnings per share $ (0.64) $ 0.22  $ (0.67) $ 1.05 
Cash dividends paid per common share $ 0.04  $ 0.04  $ 0.08  $ 0.08 
Return on average equity (19.2) % 9.0  % (9.8) % 20.4  %
Non-GAAP: (1)
Adjusted net income
$ 13,986  $ 13,125  $ 29,438  $ 26,280 
Adjusted return on average equity 12.3  % 13.1  % 12.7  % 13.5  %
Book value per share $ 10.75  $ 11.59  $ 10.75  $ 11.59 
(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures.

Year-to-date 2022 Summary

•Year-to-date revenues of $664.7 million, an increase of 11.8% from 2021 driven by similar factors impacting the quarter. Excluding investment gains and losses, revenues were up 20.2%.

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•Net loss of $23.4 million compared to net income of $36.6 million in 2021, driven by the deferred tax liability associated with the tax deconsolidation of Fortegra and unrealized losses on investments as compared to gains in the prior year period, partially offset by growth in insurance and shipping operations.

•Adjusted net income of $29.4 million increased by 12.0% from prior year, driven by growth in specialty insurance and shipping operations. Adjusted return on average equity was 12.7%.

Segment Financial Highlights - Second Quarter 2022

Insurance (The Fortegra Group):
Three Months Ended June 30, Six Months Ended June 30,
($ in thousands) 2022 2021 2022 2021
Gross written premiums and premium equivalents $ 594,696  $ 552,780  $ 1,195,551  $ 1,030,013 
Revenues $ 293,831  $ 252,255  $ 576,360  $ 474,818 
Income before taxes $ 9,071  $ 14,704  $ 23,753  $ 36,232 
Return on average equity 7.0  % 16.2  % 10.4  % 19.4  %
Combined ratio 90.9  % 92.1  % 90.7  % 91.8  %
Non-GAAP: (1)
Adjusted net income $ 18,938  $ 14,091  $ 40,062  $ 26,867 
Adjusted return on average equity 24.5  % 20.1  % 25.5  % 18.3  %
(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures.

•Fortegra’s gross written premiums and premium equivalents increased 7.6% for the quarter and 16.1% for the year driven by growth in U.S. specialty insurance lines and service contract businesses in U.S. and Europe. As a function of Fortegra’s premium growth, the combination of unearned premiums and deferred revenues on the balance sheet grew to $1.8 billion, up $0.4 billion, or 25.7%, from June 30, 2021.

•Revenues increased 16.5% for the quarter and 21.4% for the year driven by premium growth in specialty admitted and E&S lines, partially offset by unrealized investment losses. Excluding the impact of investment gains and losses, revenues increased by 21.9% for the quarter and 28.3% for the year.

•The combined ratio for the quarter was 90.9%, compared to 92.1% in Q2'21. Year-to-date combined ratio was 90.7%, an improvement of 110 basis points from 2021. Operating efficiencies contributed to an improved expense ratio, while the underwriting ratio increased modestly due to changes in business mix.

•Income before taxes for the quarter was $9.1 million. Year-to-date income before taxes of $23.8 million compared to $36.2 million in the prior year. Return on equity for the year was 10.4%, as compared to 19.4% in 2021.

•Adjusted net income for the quarter was $18.9 million, up 34.4% from Q2'21. Year-to-date adjusted net income was $40.1 million, up 49.1% from prior year driven by revenue growth and the improved combined ratio. The adjusted return on average equity was 25.5%, as compared to 18.3% in 2021.

•On April 1, 2022, Fortegra acquired ITC Compliance GRP Limited for net cash consideration of $15.0 million, which further establishes Fortegra's footprint in Europe and provides a wholly vertical compliance solution for the U.K. automotive market.

Tiptree Capital:
Three Months Ended June 30, Six Months Ended June 30,
($ in thousands) 2022 2021 2022 2021
Revenues $ 46,012  $ 47,432  $ 88,386  $ 119,557 
Income before taxes $ 9,065  $ 8,395  $ 5,680  $ 36,466 
Return on average equity 18.8  % 15.5  % 6.1  % 32.2  %
Non-GAAP: (1)
Adjusted net income $ 3,904  $ 6,123  $ 4,877  $ 14,155 
Adjusted return on average equity 9.4  % 13.6  % 5.7  % 15.7  %
Page 2



(1) See “—Non-GAAP Reconciliations” for a discussion of non-GAAP financial measures.

•Tiptree Capital income before taxes for the quarter was $9.1 million compared to $8.4 million in the prior year driven by improved dry bulk and tanker charter rates and the gain on sale of one of our dry bulk vessels.

•Income before taxes for the year was $5.7 million, down substantially from the prior year as declines in origination volumes and gain on sale margins in our mortgage business and unrealized losses on Invesque more than offset the improvements in our shipping business.

•In May 2022, $13.1 million of asset-based debt associated with tanker investments was prepaid at a discount of 10% to the outstanding principal balance.

Corporate:

Corporate includes expenses of the holding company for interest expense, employee compensation and benefits, and public company and other expenses. For the quarter, corporate expenses were $13.3 million compared to $11.6 million in Q2'21 and for the year were $25.6 million compared to $21.8 million. The increase in both periods was primarily the result of increased stock-based compensation expense.

Non-GAAP

Management uses Adjusted net income and Adjusted return on average equity as measurements of operating performance. Management believes these measures provide supplemental information useful to investors as they are frequently used by the financial community to analyze financial performance and comparison among companies. Management uses Adjusted net income and adjusted return on average equity as part of its capital allocation process and to assess comparative returns on invested capital. Adjusted net income represents income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, stock-based compensation, net realized and unrealized gains (losses), and intangibles amortization associated with purchase accounting. Adjusted net income and Adjusted return on average equity are not measurements of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for GAAP net income. See “Non-GAAP Reconciliations” for a reconciliation of these measures to their GAAP equivalents.

Earnings Conference Call
Tiptree will host a conference call on Tuesday, August 9, 2022 at 9:00 a.m. Eastern Time to discuss its Q2 2022 financial results. A copy of our investor presentation, to be used during the conference call, as well as this press release, will be available in the Investor Relations section of the Company’s website, located at www.tiptreeinc.com.

The conference call will be available via live or archived webcast at http://www.investors.tiptreeinc.com. To listen to a live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software. To participate in the telephone conference call, please dial 1-866-652-5200 (domestic) or 1-412-317-6060 (international). Please dial in at least five minutes prior to the start time.

A replay of the call will be available from Tuesday, August 9, 2022 at 12:00 p.m. Eastern Time, until midnight Eastern on Tuesday, August 16, 2022. To listen to the replay, please dial 1-844-512-2921 (domestic) or 1-412-317-6671 (international), Passcode: 10168261.

About Tiptree

Tiptree Inc. (NASDAQ: TIPT) allocates capital to select small and middle market companies with the mission of building long-term value. Established in 2007, we have a significant track record investing in the insurance sector and across a variety of other industries, including mortgage origination, specialty finance and shipping. With proprietary access and a flexible capital base, we seek to uncover compelling investment opportunities and support management teams in unlocking the full value potential of their businesses. For more information, please visit tiptreeinc.com and follow us on LinkedIn.
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Forward-Looking Statements

This release contains “forward-looking statements” which involve risks, uncertainties and contingencies, many of which are beyond the Company’s control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. All statements contained in this release that are not clearly historical in nature are forward-looking, and the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “project,” “should,” “target,” “will,” or similar expressions are intended to identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements about the Company’s plans, objectives, expectations for our businesses and intentions. The forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, many of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecast in the forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to those described in the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K, and as described in the Company’s other filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date of this release. The factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could affect our forward-looking statements. Consequently, our actual performance could be materially different from the results described or anticipated by our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by the federal securities laws, we undertake no obligation to update any forward-looking statements.
Page 4



Tiptree Inc.
Condensed Consolidated Balance Sheets
($ in thousands, except share data)
As of
June 30,
2022
December 31,
2021
Assets:
Investments:
Available for sale securities, at fair value, net of allowance for credit losses $ 606,462  $ 577,448 
Loans, at fair value 91,387  105,583 
Equity securities 96,876  138,483 
Other investments 81,690  168,656 
Total investments 876,415  990,170 
Cash and cash equivalents 337,916  175,718 
Restricted cash 13,397  19,368 
Notes and accounts receivable, net 471,462  454,369 
Reinsurance receivables 1,029,924  880,836 
Deferred acquisition costs 433,614  379,373 
Goodwill 186,567  179,103 
Intangible assets, net 125,265  122,758 
Other assets 151,867  146,844 
Assets held for sale 106,282  250,608 
Total assets $ 3,732,709  $ 3,599,147 
Liabilities and Stockholders’ Equity
Liabilities:
Debt, net $ 261,781  $ 393,349 
Unearned premiums 1,219,115  1,123,952 
Policy liabilities and unpaid claims 441,078  331,703 
Deferred revenue 593,235  534,863 
Reinsurance payable 292,355  265,569 
Other liabilities and accrued expenses 330,659  306,536 
Liabilities held for sale 69,146  242,994 
Total liabilities $ 3,207,369  $ 3,198,966 
Stockholders’ Equity:
Preferred stock: $0.001 par value, 100,000,000 shares authorized, none issued or outstanding $ —  $ — 
Common stock: $0.001 par value, 200,000,000 shares authorized, 36,305,016 and 34,124,153 shares issued and outstanding, respectively 36  34 
Additional paid-in capital 379,371  317,459 
Accumulated other comprehensive income (loss), net of tax (30,966) (2,685)
Retained earnings 41,964  68,146 
Total Tiptree Inc. stockholders’ equity 390,405  382,954 
Non-controlling interests:
Fortegra preferred interests 77,679  — 
Common interests 57,256  17,227 
Total non-controlling interests 134,935  17,227 
Total stockholders’ equity 525,340  400,181 
Total liabilities and stockholders’ equity $ 3,732,709  $ 3,599,147 

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Tiptree Inc.
Condensed Consolidated Statements of Operations
($ in thousands, except share data)
Three Months Ended
June 30,
Six Months Ended
June 30,
2022 2021 2022 2021
Revenues:
Earned premiums, net $ 215,941  $ 176,958  $ 424,357  $ 323,877 
Service and administrative fees 77,625  63,700  149,460  121,750 
Ceding commissions 3,326  3,080  5,863  6,105 
Net investment income 3,365  3,234  6,532  6,001 
Net realized and unrealized gains (losses) 15,687  36,092  32,891  105,463 
Other revenue 23,899  16,623  45,643  31,179 
Total revenues 339,843  299,687  664,746  594,375 
Expenses:
Policy and contract benefits 104,665  89,193  209,111  156,367 
Commission expense 127,453  99,543  244,876  188,188 
Employee compensation and benefits 48,262  45,693  104,717  98,617 
Interest expense 9,135  8,981  19,334  18,233 
Depreciation and amortization 6,009  6,208  12,165  12,142 
Other expenses 39,512  38,594  70,688  69,961 
Total expenses 335,036  288,212  660,891  543,508 
Income (loss) before taxes 4,807  11,475  3,855  50,867 
Less: provision (benefit) for income taxes 26,555  2,427  26,469  11,179 
Net income (loss) (21,748) 9,048  (22,614) 39,688 
Less: net income (loss) attributable to non-controlling interests 660  1,079  754  3,138 
Net income (loss) attributable to common stockholders $ (22,408) $ 7,969  $ (23,368) $ 36,550 
Net income (loss) per common share:
Basic earnings per share $ (0.64) $ 0.24  $ (0.67) $ 1.10 
Diluted earnings per share $ (0.64) $ 0.22  $ (0.67) $ 1.05 
Weighted average number of common shares:
Basic 35,228,775  32,898,769  34,731,655  32,661,195 
Diluted 35,228,775  33,567,897  34,731,655  34,842,812 
Dividends declared per common share $ 0.04  $ 0.04  $ 0.08  $ 0.08 
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Tiptree Inc.
Non-GAAP Reconciliations (Unaudited)

Non-GAAP Financial Measures — Adjusted net income and Adjusted return on average equity

The Company defines Adjusted net income as income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, including merger and acquisition related expenses, stock-based compensation, net realized and unrealized gains (losses) and intangibles amortization associated with purchase accounting. We use adjusted net income as an internal operating performance measure in the management of business as part of our capital allocation process. We believe adjusted net income provides useful supplemental information to investors as it is frequently used by the financial community to analyze financial performance between periods and for comparison among companies. Adjusted net income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define adjusted net income differently.

We define Adjusted return on average equity as Adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholder’s equity during the period. We use Adjusted return on average equity as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted return on average equity should not be viewed as a substitute for return on average equity calculated in accordance with GAAP, and other companies may define adjusted return on average equity differently.

Three Months Ended June 30, 2022
Tiptree Capital
($ in thousands) Insurance Mortgage Other Corporate Total
Income (loss) before taxes $ 9,071  $ 24  $ 9,042  $ (13,330) $ 4,807 
Less: Income tax (benefit) expense (3,670) 12  (1,300) (21,597) (26,555)
Less: Net realized and unrealized gains (losses) 10,126  (1,580) (4,450) —  4,096 
Plus: Intangibles amortization (1)
4,085  —  —  —  4,085 
Plus: Stock-based compensation expense 24  —  23  10  57 
Plus: Non-recurring expenses 1,449  —  (1,055) 2,108  2,502 
Plus: Non-cash fair value adjustments —  —  2,170  —  2,170 
Less: Tax on adjustments (2)
(2,147) 361  658  23,952  22,824 
Adjusted net income $ 18,938  $ (1,183) $ 5,088  $ (8,857) $ 13,986 
Adjusted net income $ 18,938  $ (1,183) $ 5,088  $ (8,857) $ 13,986 
Average stockholders’ equity $ 309,774  $ 57,537  $ 108,019  $ (21,082) $ 454,248 
Adjusted return on average equity 24.5  % (8.2) % 18.8  % NM% 12.3  %

Three Months Ended June 30, 2021
Tiptree Capital
($ in thousands) Insurance Mortgage Other Corporate Total
Income (loss) before taxes $ 14,704  $ 5,775  $ 2,620  $ (11,624) $ 11,475 
Less: Income tax (benefit) expense (3,334) (1,366) (34) 2,307  (2,427)
Less: Net realized and unrealized gains (losses) (2,808) (600) (142) —  (3,550)
Plus: Intangibles amortization (1)
3,835  —  —  —  3,835 
Plus: Stock-based compensation expense 500  166  479  1,149 
Plus: Non-recurring expenses 1,834  —  281  2,171  4,286 
Plus: Non-cash fair value adjustments —  —  (695) —  (695)
Less: Tax on adjustments (2)
(640) 84  30  (422) (948)
Adjusted net income $ 14,091  $ 4,059  $ 2,064  $ (7,089) $ 13,125 
Adjusted net income $ 14,091  $ 4,059  $ 2,064  $ (7,089) $ 13,125 
Average stockholders’ equity $ 281,041  $ 72,364  $ 121,129  $ (73,310) $ 401,224 
Adjusted return on average equity 20.1  % 22.4  % 6.8  % NM% 13.1  %
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Notes
(1) Specifically associated with acquisition purchase accounting. See Note (9) Goodwill and Intangible Assets, net, of the Company’s Form 10-Q for the period ended June 30, 2022.
(2)
Tax on adjustments represents the tax applied to the total non-GAAP adjustments and includes adjustments for non-recurring or discrete tax impacts. For the three and six months ended June 30, 2022, included in the adjustment is an add-back of $25.5 million related to deferred tax expense from the WP Transaction.
Six Months Ended June 30, 2022
Tiptree Capital
($ in thousands) Insurance Mortgage Other Corporate Total
Income (loss) before taxes $ 23,753  $ 4,290  $ 1,391  $ (25,579) $ 3,855 
Less: Income tax (benefit) expense (7,334) (966) 494  (18,663) (26,469)
Less: Net realized and unrealized gains (losses) 16,769  (7,894) 4,401  —  13,276 
Plus: Intangibles amortization (1)
8,031  —  —  —  8,031 
Plus: Stock-based compensation expense 2,343  —  23  3,849  6,215 
Plus: Non-recurring expenses 1,472  —  (922) 2,108  2,658 
Plus: Non-cash fair value adjustments —  —  3,684  —  3,684 
Less: Tax on adjustments (2)
(4,972) 1,831  (1,455) 22,784  18,188 
Adjusted net income $ 40,062  $ (2,739) $ 7,616  $ (15,501) $ 29,438 
Adjusted net income $ 40,062  $ (2,739) $ 7,616  $ (15,501) $ 29,438 
Average stockholders’ equity $ 314,592  $ 58,981  $ 112,190  $ (23,001) $ 462,762 
Adjusted return on average equity 25.5  % (9.3) % 13.6  % NM% 12.7  %
Six Months Ended June 30, 2021
Tiptree Capital
($ in thousands) Insurance Mortgage Other Corporate Total
Income (loss) before taxes $ 36,232  $ 18,852  $ 17,614  $ (21,831) $ 50,867 
Less: Income tax (benefit) expense (7,763) (4,462) (2,941) 3,987  (11,179)
Less: Net realized and unrealized gains (losses) (12,432) (4,020) (13,908) —  (30,360)
Plus: Intangibles amortization (1)
7,669  —  —  —  7,669 
Plus: Stock-based compensation expense 872  331  12  999  2,214 
Plus: Non-recurring expenses 2,104  —  281  2,171  4,556 
Plus: Non-cash fair value adjustments —  —  (1,352) —  (1,352)
Less: Tax on adjustments (2)
185  823  2,925  (68) 3,865 
Adjusted net income $ 26,867  $ 11,524  $ 2,631  $ (14,742) $ 26,280 
Adjusted net income $ 26,867  $ 11,524  $ 2,631  $ (14,742) $ 26,280 
Average stockholders’ equity $ 292,865  $ 67,292  $ 113,430  $ (84,295) $ 389,292 
Adjusted return on average equity 18.3  % 34.3  % 4.6  % NM% 13.5  %
Notes
(1) Specifically associated with acquisition purchase accounting. See Note (9) Goodwill and Intangible Assets, net, of the Company’s Form 10-Q for the period ended June 30, 2022.
(2)
Tax on adjustments represents the tax applied to the total non-GAAP adjustments and includes adjustments for non-recurring or discrete tax impacts. For the three and six months ended June 30, 2022, included in the adjustment is an add-back of $25.5 million related to deferred tax expense from the tax deconsolidation of Fortegra.

Non-GAAP Financial Measures — Book value per share

Management believes the use of this financial measure provides supplemental information useful to investors as book value is frequently used by the financial community to analyze company growth on a relative per share basis. The following table provides a reconciliation between total stockholders’ equity and total shares outstanding, net of treasury shares.
 ($ in thousands, except per share information)
As of June 30,
2022 2021
Total stockholders’ equity $ 525,340  $ 405,049 
Less: Non-controlling interests 134,935  18,031 
Total stockholders’ equity, net of non-controlling interests $ 390,405  $ 387,018 
Total common shares outstanding 36,305  33,395 
Book value per share $ 10.75  $ 11.59 

Page 8

EX-99.2 3 ex.htm EX-99.2 ex
Investor Presentation – Second Quarter 2022 August 2022 Financial Information for the three and six months ended June 30, 2022 EXHIBIT 99.2


 
1 Disclaimers LIMITATIONS ON THE USE OF INFORMATION This presentation has been prepared by Tiptree Inc. and its consolidated subsidiaries (“Tiptree", "the Company" or "we”) solely for informational purposes, and not for the purpose of updating any information or forecast with respect to Tiptree, its subsidiaries or any of its affiliates or any other purpose. Tiptree reports a non-controlling interest in certain operating subsidiaries that are not wholly owned. Unless otherwise noted, all information is of Tiptree on a consolidated basis before non-controlling interest. Neither Tiptree nor any of its affiliates makes any representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein and no such party shall have any liability for such information. These materials and any related oral statements are not all-inclusive and shall not be construed as legal, tax, investment or any other advice. You should consult your own counsel, accountant or business advisors. Performance information is historical and is not indicative of, nor does it guarantee future results. There can be no assurance that similar performance may be experienced in the future. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This document contains "forward-looking statements" which involve risks, uncertainties and contingencies, many of which are beyond Tiptree's control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. All statements contained herein that are not clearly historical in nature are forward-looking, and the words "anticipate," "believe," "estimate," "expect,“ “intend,” “may,” “might,” "plan," “project,” “should,” "target,“ “will,” "view," “confident,” or similar expressions are intended to identify forward-looking statements. Such forward-looking statements include, but are not limited to, statements about Tiptree's plans, objectives, expectations and intentions. The forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, many of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecast in the forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to those described in the section entitled “Risk Factors” in Tiptree’s Annual Report on Form 10-K, and as described in the Tiptree’s other filings with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as to the date of this release. The factors described therein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could affect our forward-looking statements. Consequently, our actual performance could be materially different from the results described or anticipated by our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by the federal securities laws, we undertake no obligation to update any forward- looking statements. MARKET AND INDUSTRY DATA Certain market data and industry data used in this presentation were obtained from reports of governmental agencies and industry publications and surveys. We believe the data from third-party sources to be reliable based upon our management’s knowledge of the industry, but have not independently verified such data and as such, make no guarantees as to its accuracy, completeness or timeliness. NOT AN OFFER OR A SOLICIATION This document does not constitute an offer or invitation for the sale or purchase of securities or to engage in any other transaction with Tiptree, its subsidiaries or its affiliates. The information in this document is not targeted at the residents of any particular country or jurisdiction and is not intended for distribution to, or use by, any person in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. NON-GAAP MEASURES In this document, we sometimes use financial measures derived from consolidated financial data but not presented in our financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). Certain of these data are considered “non-GAAP financial measures” under the SEC rules. These non-GAAP financial measures supplement our GAAP disclosures and should not be considered an alternative to the GAAP measure. Management's reasons for using these non-GAAP financial measures and the reconciliations to their most directly comparable GAAP financial measures are posted in the Appendix.


 
2 Q2 2022 Year-to-date Highlights Revenue $664.7 million 11.8% vs. prior year Adjusted Net Income2 $29.4 million 12.0% vs. prior year Book Value per share2,3 $10.75 2.7% vs. 3/31/22 Net Loss1 $(23.4) million vs. prior year net income of $36.6 million Overall  Adj. net income2 of $29.4mm, with a 12.7% adj. ROAE2, driven by strong performance in insurance & shipping.  Closed the previously announced $200 million strategic investment in Fortegra by Warburg Pincus.  Repaid $112.5mm of corporate debt.  Initiated exit of dry-bulk investments with expected gain of ~$21mm, or 45% as compared to Q1’22 book value. Expect sales to close in Q3’22.  Repurchased 89,543 shares in the quarter at an average price of $10.45 per share. Insurance  $1,196mm of gross written premiums and premium equivalents (GWPPE)4, 16% increase from PY driven by growth in specialty admitted & E&S insurance lines & fee-based service contract offerings.  Improved combined ratio of 90.7% from 91.8% in PY, driven by operating efficiencies.  Adj. net income of $40.1mm, up 49% from PY driven by revenue growth & improved combined ratio. Adj. ROAE of 25.5%.  Acquired ITC Compliance further expanding its presence in Europe. Tiptree Capital  Mortgage & shipping contributed pre-tax income of $20.7mm, partially offset by mark-to-market losses. ($ in millions, except per share information) 1 Net income (loss) attributable to common stockholders. 2 For a reconciliation of Non-GAAP metrics Adjusted net income, adjusted return on average equity and book value per share to GAAP financials, see the Appendix. 3 Quarterly total return defined as cumulative dividends paid of $0.04 per share plus book value per share as of June 30, 2022. 4 Gross written premium and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership.


 
Financial Results Q2’21 Q2'22 Q2’21 YTD Q2’22 YTD Total Revenues $299.7 $339.8 $594.4 $664.7 Net income (loss) $8.0 $(22.4) $36.6 $(23.4) Diluted EPS $0.22 $(0.64) $1.05 $(0.67) Adjusted net income1 $13.1 $14.0 $26.3 $29.4 Adjusted ROAE1 13.1% 12.3% 13.5% 12.7% Total shares outstanding 33.4 36.3 33.4 36.3 Book Value per share1 $11.59 $10.75 $11.59 $10.75 31 For a reconciliation of Non-GAAP metrics Adjusted net income, adjusted return on average equity and book value per share to GAAP financials, see the Appendix. 2 Includes dividends paid. Quarterly total return defined as dividends paid of $0.04 per share plus book value per share as of June 30, 2022. ($ in millions, except per share information) $9.0 $14.1 $18.9 $7.2 $6.1 $3.9 $(5.7) $(7.1) $(8.9) $10.5 $13.1 $14.0 Q2'20 Q2'21 Q2'22 Corporate Fortegra Tiptree Capital Key Highlights – Q2’22 Adjusted Net Income by business Fortegra Investment • Closing of the Warburg investment resulted in $63.2mm pre-tax impact to equity, offset by $39.6mm of tax expense related to the tax deconsolidation of Fortegra • Of the total deferred tax liability, $25.5mm impacted net income with $14.1mm offsetting the gain in stockholders’ equity directly. Adj net income of $14.0mm, increased by 6.6% versus prior year; • Continued revenue growth and improvements in Fortegra’s combined ratio, strong contributions from shipping, offset partially by declines in mortgage business Net income of $(22.4)mm resulting from tax expense on Fortegra transaction • Unrealized investment losses more than offset improvement in operations BVPS of $10.75 decreased by 5.9%2 over PY; up 2.7%2 from PQ • Interest rate movements drove unrealized losses on fixed income securities (impacting AOCI); expect to be able to hold to maturity • Partially offset by positive impacts to BV from Fortegra transaction closing $17.7 $26.9 $40.1 $10.7 $14.2 $4.9 $(11.0) $(14.7) $(15.5) $17.4 $26.3 $29.4 Q2'20 YTD Q2'21 YTD Q2'22 YTD


 
Specialty Insurance Performance Highlights Q2’22


 
5 Fortegra – Financial Performance Highlights Product & distribution expansion to drive continued growth, while maintaining underwriting discipline • Unearned premiums and deferred revenue grew to $1.8Bn, a 26% increase year-over-year • Underwriting and fee revenues increased to $301mm, up 21% • Continued investment in strategic initiatives ✓ Specialty admitted & E&S lines ✓ Capital-light warranty solutions ✓ European expansion Produced stable, growing results from underwriting and fees • Underwriting margin of $68mm, up 19%, driven by growth in U.S. Insurance and European lines • Combined ratio improved to 90.9% Capital and liquidity remain strong and continue to support growth objectives Underwriting and Fee Margin1 Underwriting and Fee Revenues1 Combined Ratio 1 2 3 Summary Financials Insurance products Q2’22 Highlights & Outlook 35 41 21 22 1 6 $57 $68 Q2'21 Q2'22 179 217 56 6714 16 $249 $301 Q2'21 Q2'22 76.7% 77.2% 15.5% 13.7% 92.1% 90.9% Q2'21 Q2'22 ($ in millions) U.S. Warranty Solutions U.S Insurance Europe Warranty Solutions Expense Ratio Underwriting Ratio Europe Warranty Solutions U.S. Warranty Solutions U.S. Insurance 1 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income, Adjusted return on average equity, underwriting and fee revenues and underwriting and fee margin. 2 Gross written premiums and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership. Q2’21 Q2’22 Q2’21 YTD Q2’22 YTD Premiums & equivalents2 $552.8 $594.7 $1,030.0 $1,195.6 Revenue $252.3 $293.8 $474.8 $576.4 Pre-tax income (loss) $14.7 $9.1 $36.2 $23.8 Adjusted net income1 $14.1 $18.9 $26.9 $40.0 Adjusted ROAE1 20.1% 24.5% 18.3% 25.5% Combined ratio 92.1% 90.9% 91.8% 90.7% Unearned Premiums & Deferred Revenues $1,441.2 $1,812.0


 
Growth oriented while maintaining underwriting profitability 77.1% 75.1% 75.5% 77.4% 16.2% 17.7% 16.3% 13.3% 93.3% 92.9% 91.8% 90.7% Q2'19 Q2'20 Q2'21 Q2'22 $14.1 $17.7 $26.9 $40.1 Q2'19 Q2'20 Q2'21 Q2'22 6 ($ in millions, all figures represent Q2 year-to-date) Gross Written Premiums & Equivalents1 Underwriting & Fee Revenues and Margin2 Adjusted Net Income2 432 440 689 783 119 250 301 346 23 22 40 67 $573 $711 $1,030 $1,196 Q2'19 Q2'20 Q2'21 Q2'22 Combined Ratio Adj. ROAE%1 Adj. Net Income U/W Ratio Expense Ratio U.S. Insurance U.S. Warranty Solutions Europe Warranty Solutions 1 Gross written premiums and premium equivalents are the base used to calculate the service fee income for non-insurance products. This base includes the amount charged to end consumers for a warranty or a car club membership. 2 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income, Adjusted return on average equity, underwriting and fee revenues and underwriting and fee margin. 11% 19% U/W & Fee Revenues U/W & Fee Margin 26%13% 251 247 329 428 43 75 107 128 1 9 20 30 $295 $330 $456 $587 Q2'19 Q2'20 Q2'21 Q2'22 49 50 65 80 19 28 42 42 0 4 5 10 $68 $82 $112 $133 Q2'19 Q2'20 Q2'21 Q2'22


 
Investment Portfolio Cash & Equivalents 26% Government & Agency 37% Corporate Bonds 17% Fixed Income ETFs 6% Muni & ABS 6% Equities 2% Other Alternatives 6% Cash & Equivalents 28% Government & Agency 40% AAA 2% AA 8% A 15% BBB 1% Fixed Income ETFs 6% $926mm 7 Asset Allocation Liquid and Highly-Rated Fixed Income Portfolio ($ in millions) 623 926 191 84 $815 $1,011 Q2'21 Q2'22 Other investments Fixed Income & Cash Return Metrics (Pre-tax) $1,011mm ◼ ~2.6 year duration ◼ AA+ rating ◼ 1.2% book yield Q2’21 Q2'22 Q2’21 YTD Q2’22 YTD Net investment income $3.2 $3.4 $6.0) $6.5 Net realized and unrealized gains (losses) $2.8 $(10.1) $12.5 $(16.8)


 
Performance Highlights Q2’22


 
77.1 82.3 74.1 57.6 39.9 17.5 4.4 2.6 $195.5 $160.0 Q2'21 Q2'22 Financial drivers Pre-tax income (loss) Q2’21 Q2’22 Q2’21 YTD Q2’22 YTD Mortgage $5.8 $0.0 $18.9 $4.3 Senior living (Invesque)2 0.1 (2.7) 13.9 (11.5) Maritime transportation 2.0 13.8 2.5 16.4 Other 0.5 (2.0) 1.2 (3.5) Total $8.4 $9.1 $36.5 $5.7 9 Tiptree Capital – Financial Performance Highlights Mortgage: • Mortgage origination volumes of $661mm, down 17% from PY • Pre-tax income below PY from decline in volume & margins, partially offset by higher servicing fees & positive FV adjustments on MSR • MSRs of $41mm, including $1.6mm positive MTM in Q2’22 Maritime transportation: • Charter rates remain strong • Favorable valuations led to strategic sales of dry bulk vessels Senior living (Invesque – IVQ.U): • Observing positive operating trends in some healthcare real estate sectors • Unrealized losses of $11.5mm, compared to PY gains of $13.9mm Mortgage Maritime transportation Seniors Housing (Invesque/Care)2 1 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income. 2 17.0m of Invesque common shares, 2.9m shares held in the insurance company investment portfolio. On balance sheet at fair value - $20.9 million, $17.3 million in Tiptree Capital as of June 30, 2022. Capital Allocation Q2’22 Year-to-date Highlights ($ in millions) Other


 
01 Summary & Outlook


 
Financial Snapshot 11 ($ in millions) LTM Adjusted Net Income1 1) See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income. 2) Estimated based on Warburg Pincus valuation multiple of 13.5x Adj. Net Income, multiplied by LTM Adj. Net Income of $80.0 million, multiplied by Tiptree’s 72.6% as converted ownership as of Q2’22, less deferred tax liability of $39.6 million recorded as of Q2’22. 3) Includes Tiptree Inc. stockholders’ equity of Mortgage, Tiptree Capital – Other and Corporate, excluding the deferred tax liability relating to Tiptree’s investment in Fortegra. 4) Diluted shares as of June 30, 2022, represents basic outstanding shares of 36,305,016 plus dilutive shares of 1,172,940 which includes unvested RSUs and outstanding options (assumed to be exercised cashless). Adj ROAE% 16.0% 14.4% Sum of the Parts $60.3 $67.0 Q2'21 Q2'22 $744 million2 (Transaction multiple) $235 million3 (Book value ex. NCI) $979 million $19.85 Value/TIPT diluted share4 Pro-forma SOTP Value $6.27 $26.12


 
12 ❑ Significant opportunities ahead to achieve value creation objectives at Fortegra ❑ Continued focus on long-term value creating opportunities Summary & Outlook ($ in millions) ✓ Strong operating performance from our businesses – Fortegra continues to deliver record top-line and return on equity – Solid contributions from favorable shipping environment both in charter rates and vessel valuations ✓ $200mm investment in Fortegra from Warburg Pincus closed in Jun’22 1 See the appendix for a reconciliation of Non-GAAP measures including Adjusted Net Income and Adjusted return on average equity. First Half 2022 Highlights Looking Ahead


 
Appendix Non-GAAP Reconciliations • Insurance underwriting and fee revenue • Insurance underwriting and fee margin • Book Value per share • Adjusted net income


 
Q2’22 Capital Allocation & Annual Performance Comparison 141 Represents total stockholders’ equity. Total stockholders’ equity net of non-controlling interests was $390.4 million as of June 30, 2022. 2 See the appendix for a reconciliation of Non-GAAP metrics including Adjusted net income and adjusted return on average equity. Adjusted net income of $67.0mm, up 11.2% from Q2’21 LTM • Adjusted return on average equity of 14.4%1 Fortegra: 26.1% Adj. ROAE • Growth in insurance underwriting and fee revenues • Combined ratio improvement • Expect continued growth in specialty and warranty lines Tiptree Capital: 10.6% Adj. ROAE • Positive operating contributions from shipping investments • Mortgage business margins and volumes normalize Q2’22 LTM Highlights Stockholders’ Equity1 Adjusted Net Income2 Business Lines Q2’22 Q2’21 LTM Q2’22 LTM Fortegra $325.3 $52.6 $80.0 - Underwriting & fees $44.4 $68.3 - Investments $8.2 $11.7 Tiptree Capital $160.0 $36.5 $18.9 Corporate $40.1 $(28.8) $(31.9) Total Tiptree $525.3 $60.3 $67.0 ($ in millions) LTM Operating Performance


 
Non-GAAP Reconciliations 15 Adjusted Net Income We define adjusted net income as income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, including merger and acquisition related expenses, stock-based compensation, net realized and unrealized gains (losses) and intangibles amortization associated with purchase accounting. We use adjusted net income as an internal operating performance measure in the management of business as part of our capital allocation process. We believe adjusted net income provides useful supplemental information to investors as it is frequently used by the financial community to analyze financial performance between periods and for comparison among companies. Adjusted net income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define adjusted net income differently. We present adjustments for amortization associated with acquired intangible assets. The intangible assets were recorded as part of purchase accounting in connection with Tiptree’s acquisition of FFC in 2014, Defend in 2019, and Smart AutoCare and Sky Auto in 2020. The intangible assets acquired contribute to overall revenue generation, and the respective purchase accounting adjustments will continue to occur in future periods until such intangible assets are fully amortized in accordance with the respective amortization periods required by GAAP. We define adjusted return on average equity as adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholder’s equity during the period. We use adjusted return on average equity as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted return on average equity should not be viewed as a substitute for return on average equity calculated in accordance with GAAP, and other companies may define adjusted return on average equity differently. Book value per share Management believes the use of book value per share provides supplemental information useful to investors as it is frequently used by the financial community to analyze company growth on a relative per share basis. Insurance – Underwriting and Fee Revenues We generally manage our exposure to the underwriting risk we assume using both reinsurance (e.g., quota share and excess of loss) and retrospective commission agreements with our partners (e.g., commissions paid are adjusted based on the actual underlying losses incurred), which mitigate our risk. Period-over-period comparisons of revenues and expenses are often impacted by the PORCs and distribution partners’ choice as to whether to retain risk, specifically service and administration fees and ceding commissions, both components of revenue, and policy and contract benefits and commissions paid to our partners and reinsurers. Generally, when losses are incurred, the risk which is retained by our partners and reinsurers is reflected in a reduction in commissions paid. In order to better explain to investors the underwriting performance of the Company’s programs and the respective retentions between the Company and its agents and reinsurance partners, we use the non-GAAP metrics underwriting and fee revenues and underwriting and fee margin. We define underwriting and fee revenues as total revenues from our Insurance segment excluding net investment income, net realized and unrealized gains (losses). Underwriting and fee revenues represents revenues generated by our underwriting and fee-based operations and allows us to evaluate our underwriting performance without regard to investment income. We use this metric as we believe it gives our management and other users of our financial information useful insight into our underlying business performance. Underwriting and fee revenues should not be viewed as a substitute for total revenues calculated in accordance with GAAP, and other companies may define underwriting and fee revenues differently. Insurance - Underwriting and Fee Margin We define underwriting and fee margin as income before taxes from our Insurance segment, excluding net investment income, net realized and unrealized gains (losses), employee compensation and benefits, other expenses, interest expense and depreciation and amortization. Underwriting and fee margin represents the underwriting performance of our underwriting and fee-based programs. As such, underwriting and fee margin excludes general administrative expenses, interest expense, depreciation and amortization and other corporate expenses as those expenses support the vertically integrated business model and not any individual component of our business mix. We use this metric as we believe it gives our management and other users of our financial information useful insight into the specific performance of our underlying underwriting and fee program. Underwriting and fee income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define underwriting and fee margin differently.


 
16 Non-GAAP Reconciliations – Underwriting & Fee Revenues & Margin We define underwriting and fee revenues as total revenues from our Insurance segment excluding net investment income, net realized and unrealized gains (losses). Underwriting and fee revenues represents revenues generated by our underwriting and fee-based operations and allows us to evaluate our underwriting performance without regard to investment income. We use this metric as we believe it gives our management and other users of our financial information useful insight into our underlying business performance. Underwriting and fee revenues should not be viewed as a substitute for total revenues calculated in accordance with GAAP, and other companies may define underwriting and fee revenues differently. We define underwriting and fee margin as income before taxes from our Insurance segment, excluding net investment income, net realized and unrealized gains (losses), employee compensation and benefits, other expenses, interest expense and depreciation and amortization. Underwriting and fee margin represents the underwriting performance of our underwriting and fee-based programs. As such, underwriting and fee margin excludes general administrative expenses, interest expense, depreciation and amortization and other corporate expenses as those expenses support the vertically integrated business model and not any individual component of our business mix. We use this metric as we believe it gives our management and other users of our financial information useful insight into the specific performance of our underlying underwriting and fee program. Underwriting and fee income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define underwriting and fee margin differently. Management uses Book value per share, which is a non-GAAP financial measure. Management believes the use of this financial measure provides supplemental information useful to investors as it is frequently used by the financial community to analyze company growth on a relative per share basis. ($ in thousands, except per share information) Three Months Ended June 30, 2022 2021 2020 Total revenues $ 293,831 $ 252,255 $ 164,953 Less: Net investment income (3,365) (3,234) (2,292) Less: Net realized and unrealized gains (losses) 10,126 (2,824) (5,633) Underwriting and fee revenues $ 300,592 $ 246,197 $ 157,028 Three Months Ended June 30, 2022 2021 2020 Income (loss) before income taxes $ 14,682 $ 14,704 $ 14,088 Less: Net investment income (3,167) (3,234) (2,292) Less: Net realized and unrealized gains (losses) 6,643 (2,824) (5,633) Plus: Depreciation and amortization 4,354 4,407 2,630 Plus: Interest expense 4,759 4,525 3,582 Plus: Employee compensation and benefits 22,026 18,392 14,916 Plus: Other expenses 14,839 21,491 12,687 Underwriting and fee margin $ 64,136 $ 57,461 $ 39,978 As of June 30, 2022 2021 2020 Total stockholders’ equity $ 525,340 $ 405,049 $ 347,189 Less: Non-controlling interests 134,935 18,031 11,368 Total stockholders’ equity, net of non-controlling interests $ 390,405 $ 387,018 $ 335,821 Total common shares outstanding 36,305 33,395 33,700 Book value per share $ 10.75 $ 11.59 $ 9.97 Six Months Ended, June 30, 2022 2021 $ 576,360 $ 474,818 (6,532) (6,001) 16,769 (12,496) $ 586,597 $ 456,321 Six Months Ended June 30, 2022 2021 $ 29,386 $ 36,232 (6,401) (6,001) 3,819 (12,496) 8,761 8,598 9,284 8,829 40,418 37,481 36,330 39,123 $ 121,597 $ 111,766


 
17 Non-GAAP Reconciliations – Adjusted Net Income Three Months Ended June 30, 2022 Tiptree Capital ($ in thousands) Insurance Mortgage Other Corporate Total Income (loss) before taxes 9,071 24 9,041 (13,330) 4,806 Less: Income tax (benefit) expense -3,670 12 (1,300) (21,597) -26,555 Less: Net realized and unrealized gains (losses) 10,126 (1,580) (4,450) - 4,096 Plus: Intangibles amortization (1) 4,085 - - - 4,085 Plus: Stock-based compensation expense 24 - 23 10 57 Plus: Non-recurring expenses 1,449 - (1,055) 2,108 2,502 Plus: Non-cash fair value adjustments - - 2,170 - 2,170 Less: Tax on adjustments (2) (2,147) 361 658 23,952 22,824 Adjusted net income 18,938 (1,183) 5,087 (8,857) 13,985 Adjusted net income 18,938 (1,183) 5,087 (8,857) 13,985 Average stockholders’ equity 309,774 57,537 108,019 (21,082) 454,248 Adjusted return on average equity 24.5% -8.2% 18.8% NM% 12.3% Three Months Ended June 30, 2021 Tiptree Capital Insurance Mortgage Other Corporate Total 14,704 5,775 2,620 (11,624) 11,475 (3,334) (1,366) (34) 2,307 (2,427) (2,808) (600) (142) - (3,550) 3,835 - - - 3,835 500 166 4 479 1,149 1,834 - 281 2,171 4,286 - - (695) - (695) (640) 84 30 (422) (948) 14,091 4,059 2,064 (7,089) 13,125 14,091 4,059 2,064 (7,089) 13,125 281,041 72,364 121,129 (73,310) 401,224 20.1% 22.4% 6.8% NM% 13.1% Six Months Ended June 30, 2022 Tiptree Capital ($ in thousands) Insurance Mortgage Other Corporate Total Income (loss) before taxes 23,753 4,290 1,391 (25,579) 3,855 Less: Income tax (benefit) expense (7,334) (966) 494 (18,663) (26,469) Less: Net realized and unrealized gains (losses) 16,769 (7,894) 4,401 - 13,276 Plus: Intangibles amortization (1) 8,031 - - - 8,031 Plus: Stock-based compensation expense 2,343 - 23 3,849 6,215 Plus: Non-recurring expenses 1,472 - (922) 2,108 2,658 Plus: Non-cash fair value adjustments - - 3,684 - 3,684 Less: Tax on adjustments (2) (4,972) 1,831 (1,455) 22,784 18,188 Adjusted net income 40,062 (2,739) 7,616 (15,501) 29,438 Adjusted net income 40,062 (2,739) 7,616 (15,501) 29,438 Average stockholders’ equity 314,592 58,981 112,190 (23,001) 462,762 Adjusted return on average equity 25.5% -9.3% 13.6% NM% 12.7% Six Months Ended June 30, 2021 Tiptree Capital Insurance Mortgage Other Corporate Total 36,232 18,852 17,614 (21,831) 50,867 (7,763) (4,462) (2,941) 3,987 (11,179) (12,432) (4,020) (13,908) - (30,360) 7,669 - - - 7,669 872 331 12 999 2,214 2,104 - 281 2,171 4,556 - - (1,352) - (1,352) 185 823 2,925 (68) 3,865 26,867 11,524 2,631 (14,742) 26,280 26,867 11,524 2,631 (14,742) 26,280 292,865 67,292 113,430 (84,295) 389,292 18.3% 34.3% 4.6% NM% 13.5% The footnotes below correspond to the tables above, under “—Adjusted Net Income - Non- GAAP and “—Adjusted Return on Average Equity - Non-GAAP”. (1) Specifically associated with acquisition purchase accounting. See Note (9) Goodwill and Intangible Assets, net. (2) Tax on adjustments represents the tax applied to the total non-GAAP adjustments and includes adjustments for non-recurring or discrete tax impacts. For the three, six and twelve months ended June 30, 2022, included in the adjustment is an add-back of $25.5 million related to deferred tax expense from the WP Transaction. Trailing Twelve Ended June 30, 2022 Tiptree Capital Insurance Mortgage Other Corporate Total 57,378 13,845 986 (53,880) 18,329 (18,009) (1,386) 1,443 (18,629) (36,581) 25,469 (9,672) 15,218 0 31,015 15,691 0 0 0 15,691 3,477 0 224 11,431 15,132 1,526 0 (265) 2,108 3,369 0 0 1,866 0 1,866 (5,555) 384 (3,725) 27,101 18,205 79,977 3,171 15,747 (31,869) 67,026 79,977 3,171 15,747 (31,869) 67,026 306,637 65,841 111,902 (19,186) 465,195 26.1% 4.8% 14.1% NM% 14.4%


 
TiptreeInc. ir@tiptreeinc.com