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Section 1: 8-K (8-K)

axs-20200504
0001214816AXIS CAPITAL HOLDINGS LTDfalse00012148162020-05-042020-05-0400012148162020-04-292020-04-290001214816us-gaap:CommonStockMember2020-05-042020-05-040001214816us-gaap:SeriesEPreferredStockMember2020-05-042020-05-04

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 4, 2020
AXIS CAPITAL HOLDINGS LIMITED
(Exact Name Of Registrant As Specified In Charter)

Bermuda 001-31721 98-0395986
(State of Incorporation) (Commission File No.) 
(I.R.S. Employer
Identification No.)
92 Pitts Bay Road
Pembroke, Bermuda HM 08
(Address of principal executive offices, including zip code)
(441) 496-2600
(Registrant’s telephone number, including area code)
Not applicable
(Former name or 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 Exchange Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common shares, par value $0.0125 per shareAXSNew York Stock Exchange
Depositary Shares, each representing a 1/100th interest in a 5.50% Series E preferred share
AXS PRENew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).



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 2.02Results of Operations and Financial Condition.

On May 4, 2020, AXIS Capital Holdings Limited, a Bermuda company, issued a press release reporting its first quarter 2020 results and the availability of its first quarter 2020 investor financial supplement. The press release and the investor financial supplement are attached hereto as Exhibit 99.1 and Exhibit 99.2, respectively.
Item 9.01Financial Statements and Exhibits

(d) Exhibits
Press release dated May 4, 2020
First quarter 2020 Investor Financial Supplement
104  
Cover Page Interactive Data File (embedded within the Inline XBRL document)






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.
Dated: May 4, 2020
 
AXIS CAPITAL HOLDINGS LIMITED
By:/s/ Conrad D. Brooks
 Conrad D. Brooks
 General Counsel


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Section 2: EX-99.1 (PRESS RELEASE DATED MAY 4, 2020)

Document


403856323_axislogo1a0111.jpg


Matt Rohrmann (Investor Contact):(212) 940-3339;investorrelations@axiscapital.com
Anna Kukowski (Media Contact):(212) 715-3574;
anna.kukowski@axiscapital.com



AXIS CAPITAL REPORTS FIRST QUARTER 2020 RESULTS

For the first quarter of 2020, the Company reports:
Net loss attributable to common shareholders of $185 million, or ($2.20) per diluted common share, and ex-PGAAP operating loss of $161 million, or ($1.90) per diluted common share
Estimated pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums, of $300 million, or 26.9 points, including $235 million, or 21.3 points attributable to the COVID-19 pandemic
Current accident year combined ratio, excluding catastrophe and weather-related losses decreased by 3.8 points and ex-PGAAP current accident year combined ratio, excluding catastrophe and weather-related losses decreased by 4.2 points
Book value per diluted common share of $49.78

Pembroke, Bermuda, May 4, 2020 - AXIS Capital Holdings Limited ("AXIS Capital" or "the Company") (NYSE: AXS) today announced financial results for the first quarter ended March 31, 2020.
Commenting on the first quarter 2020 financial results, Albert Benchimol, President and CEO of AXIS Capital, said:
"As our industry and society continue to navigate the challenges brought on by COVID-19, our primary thoughts are with the people, families and communities that have been directly impacted by the pandemic, and with the health and safety of our staff.

"Like all (re)insurers, our financial results have been impacted by COVID-19. The losses from the pandemic overshadowed what otherwise would have been an excellent quarter for AXIS. The first quarter was highlighted by a more than 4 point improvement in our ex-PGAAP current accident year ex-cat combined ratio with better results across our losses, acquisition costs and general and administrative expenses. This continued improvement is driven by our efforts over the past few years to enhance profitability within our portfolio, enhance operating efficiency, and deliver growth across our most attractive lines.

"We have a well-balanced book of business, great relationships with our producers, and – despite the remote work environment – we are continuing to deliver the same high level of service to our customers..

"Our actions are grounded in our corporate purpose, a belief that we exist to help people, organizations and communities during their time of need. We proudly stand by our clients and partners in distribution as we together navigate this transformed environment."


AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

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First Quarter Consolidated Results

Net loss attributable to common shareholders for the first quarter of 2020 was $185 million, or ($2.20) per diluted common share, compared to net income available to common shareholders of $98 million, or $1.16 per diluted common share, for the first quarter of 2019.
Operating loss1 for the first quarter of 2020 was $164 million, or ($1.94) per diluted common share1, compared to operating income of $105 million, or $1.24 per diluted common share, for the first quarter of 2019.
Ex-PGAAP operating loss2 for the first quarter of 2020 was $161 million, or ($1.90) per diluted common share2, compared to ex-PGAAP operating income of $112 million, or $1.33 per diluted common share, for the first quarter of 2019.
Adjusted for dividends declared, the book value per diluted common share decreased by $5.60, or 10%, compared to December 31, 2019.
Adjusted for dividends declared, the book value per diluted common share decreased by $1.44, or 3%, over the past twelve months.
























1Operating income (loss) and operating income (loss) per diluted common share are non-GAAP financial measures as defined in SEC Regulation G. The reconciliations to the most comparable GAAP financial measures, net income (loss) available (attributable) to common shareholders and earnings (loss) per diluted common share, respectively, and a discussion of the rationale for the presentation of these items are provided later in this press release. Operating loss per diluted common share for the three months ended March 31, 2020, was calculated using weighted average common shares outstanding due to the operating loss recognized in the period.
2Ex-PGAAP operating income (loss), ex-PGAAP operating income (loss) per diluted common share and annualized ex-PGAAP operating return on average common equity ("ex-PGAAP operating ROACE") are non-GAAP financial measures as defined in SEC Regulation G. The reconciliations to the most comparable GAAP financial measures, net income (loss) available (attributable) to common shareholders, earnings (loss) per diluted common share, and annualized return on average common equity ("ROACE"), respectively, and a discussion of the rationale for the presentation of these items are provided later in this press release. Ex-PGAAP operating loss per diluted common share for the three months ended March 31, 2020, was calculated using weighted average common shares outstanding due to the ex-PGAAP operating loss recognized in the period.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 2 -


First Quarter Consolidated Underwriting Highlights3

Gross premiums written decreased by $152 million, or 6%, to $2.4 billion with a decrease of $242 million, or 14% in the reinsurance segment, partially offset by an increase of $90 million or 11% in the insurance segment.
Net premiums written decreased by $98 million, or 6%, to $1.7 billion with a decrease of $150 million, or (12%) in the reinsurance segment, partially offset by an increase of $52 million or 10% in the insurance segment.
Three months ended March 31,
KEY RATIOS20202019Change
Current accident year loss ratio excluding catastrophe and weather-related losses57.1 %58.9 %(1.8 pts) 
Catastrophe and weather-related losses ratio26.9 %0.9 %26.0 pts  
Current accident year loss ratio84.0 %59.8 %24.2 pts  
Prior year reserve development ratio(0.6 %)(1.3 %)0.7 pts  
Net losses and loss expenses ratio83.4 %58.5 %24.9 pts  
Acquisition cost ratio21.9 %23.0 %(1.1 pts) 
General and administrative expense ratio14.5 %15.4 %(0.9 pts) 
Combined ratio119.8 %96.9 %22.9 pts  
Ex-PGAAP current accident year combined ratio, excluding catastrophe and weather-related losses decreased by 4.2 points associated with the repositioning of our portfolios and the exit from certain product lines.
Estimated pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums were $300 million, or 26.9 points primarily attributable to the COVID-19 pandemic and other weather-related events this quarter, compared to $11 million, or 0.9 points in 2019.
Estimated pre-tax losses, net of reinsurance and reinstatement premiums attributable to the COVID-19 pandemic were $235 million. This estimate was primarily associated with property related coverages, but also included event cancellation and accident & health coverages, and considered a global shelter in place order that remains in effect until July 31, 2020.
Net favorable prior year reserve development was $6 million (Insurance $4 million; Reinsurance $2 million), compared to $15 million (Insurance $7 million; Reinsurance $8 million) in 2019.
Underwriting income (loss) for the first quarter of 2020 and 2019 included the recognition of premiums attributable to the balance sheet of Novae Group plc ("Novae") at October 2, 2017 (the "closing date" or the "acquisition date"), without the recognition of the associated acquisition costs, which were written off at the closing date. The absence of $0.5 million and $6 million of acquisition expenses related to premiums earned in the first quarter of 2020 and 2019, respectively, benefited the acquisition cost ratio by 0.1 points and 0.5 points, respectively. Adjusting the acquisition cost ratio for these amounts, the acquisition cost ratio decreased by 1.5 points in the quarter compared to the same period in 2019 due to changes in business mix.

3 All comparisons are with the same period of the prior year, unless otherwise stated.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

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Amortization of value of business acquired ("VOBA") of $2 million and $13 million, was recognized in the first quarter of 2020 and 2019, respectively. This expense impacted operating income (loss) but was not included in the results of the insurance and reinsurance segments.



AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

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Segment Highlights

Insurance Segment
Three months ended March 31,
($ in thousands)20202019Change
Gross premiums written$940,715  $851,096  10.5 %
Net premiums written581,650  529,239  9.9 %
Net premiums earned562,064  556,762  1.0 %
Underwriting income (loss)(122,630) 20,919  nm  
Underwriting ratios:
Current accident year loss ratio excluding catastrophe and weather-related losses54.2 %56.2 %(2.0 %)
Catastrophe and weather-related losses ratio30.4 %1.4 %29.0 %
Current accident year loss ratio84.6 %57.6 %27.0 %
Prior year reserve development ratio(0.7 %)(1.2 %)0.5 %
Net losses and loss expenses ratio83.9 %56.4 %27.5 %
Acquisition cost ratio20.1 %21.2 %(1.1 %)
Underwriting-related general and administrative expense ratio17.9 %19.0 %(1.1 %)
Combined ratio121.9 %96.6 %25.3 %
nm - not meaningful
Ex-PGAAP current accident year combined ratio, excluding catastrophe and weather-related losses decreased by 5.2 points associated with the repositioning of our portfolios and the exit from certain product lines.
Gross premiums written increased by $90 million, or 11%, primarily attributable to increases in professional lines, liability, property, and marine lines driven by new business and favorable rate changes.
Net premiums written increased by $52 million, or 10%, reflecting the increase in gross premiums written in the quarter.
The current accident year loss ratio excluding catastrophe and weather-related losses decreased by 2.0 points in the first quarter compared to the same period in 2019, principally due to a decrease in loss experience in marine and aviation lines, together with the continued impact of rate over trend, partially offset by changes in business mix.
Estimated pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums were $178 million, primarily attributable to the COVID-19 pandemic and other weather-related events this quarter, compared to $8 million in 2019.
Estimated pre-tax losses, net of reinsurance and reinstatement premiums attributable to the COVID-19 pandemic were $135 million. This estimate was primarily associated with property related coverages, but also included event cancellation coverages, and considered a global shelter in place order that remains in effect until July 31, 2020.
Net favorable prior year reserve development was $4 million this quarter, compared to $7 million in the first quarter of 2019.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 5 -


Underwriting income (loss) for the first quarter of 2020 and 2019 included the recognition of premiums attributable to Novae's balance sheet at October 2, 2017, without the recognition of the associated acquisition costs, which were written off at the closing date. The absence of $0.5 million and $6 million of acquisition expenses related to premiums earned in the first quarter of 2020 and 2019, benefited the acquisition cost ratio by 0.1 points and 1.1 points, respectively. Adjusting the acquisition cost ratio for these amounts, the acquisition cost ratio decreased by 2.2 points in the first quarter compared to the same period in 2019 due to changes in business mix.
The underwriting-related general and administrative expense ratio decreased by 1.1 points in the quarter attributable to a modest decrease in underwriting-related general and administrative expense related to professional services fees, and travel and entertainment expenses, together with a modest increase in in net premiums earned.



AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 6 -


Reinsurance Segment
Three months ended March 31,
($ in thousands)20202019Change
Gross premiums written$1,490,443  $1,732,130  (14.0 %)
Net premiums written1,097,394  1,247,820  (12.1 %)
Net premiums earned526,561  577,450  (8.8 %)
Underwriting income (loss)(74,137) 56,903  nm  
Underwriting ratios:
Current accident year loss ratio excluding catastrophe and weather-related losses60.2 %61.5 %(1.3 pts) 
Catastrophe and weather-related losses ratio23.1 %0.5 %22.6 pts  
Current accident year loss ratio83.3 %62.0 %21.3 pts  
Prior year reserve development ratio(0.4 %)(1.3 %)0.9 pts  
Net losses and loss expenses ratio82.9 %60.7 %22.2 pts  
Acquisition cost ratio23.9 %24.7 %(0.8 pts) 
Underwriting-related general and administrative expense ratio5.5 %5.6 %(0.1 pts) 
Combined ratio112.3 %91.0 %21.3 pts  
nm - not meaningful
Current accident year combined ratio, excluding catastrophe and weather-related losses decreased by 2.2 points associated with the repositioning of our portfolios.
Gross premiums written decreased by $242 million, or 14%, primarily attributable to catastrophe, credit and surety, and property lines driven by non-renewals and decreased line sizes. In addition, agriculture lines decreased due to the timing of the renewal of a significant contract. These decreases were partially offset by increases in liability, and accident and health lines driven by new business due to favorable market conditions.
Net premiums written decreased by $150 million, or 12%, reflecting the decrease in gross premiums written in the quarter, together with increases in premiums ceded in motor, liability, and property lines.
Other insurance loss was $9 million this quarter, compared to other insurance income of $5 million in the first quarter of 2019 primarily due to the recognition of full limit loss of $10 million associated with the WHO pandemic risk-linked swap.
The current accident year loss ratio excluding catastrophe and weather-related losses decreased by 1.3 points in the first quarter compared to the same period in 2019, principally due to changes in business mix and a decrease in loss experience in aviation lines.
Estimated pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums were $122 million, primarily attributable to the COVID-19 pandemic and other weather-related events this quarter, compared to $3 million in 2019.
Estimated pre-tax losses, net of reinsurance and reinstatement premiums attributable to the COVID-19 pandemic were $100 million. This estimate was primarily associated with property related coverages, but also included accident and health coverages, and considered a global shelter in place order that remains in effect until July 31, 2020.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 7 -


Net favorable prior year reserve development was $2 million this quarter, compared to $8 million in the first quarter of 2019.
The acquisition cost ratio decreased by 0.8 points in the quarter, due to changes in business mix and the impact of retrocessional contracts, partially offset by adjustments related to loss sensitive features.


AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 8 -


Investments

Net investment income of $93 million for the quarter represents a decrease of $14 million, compared to the first quarter of 2019 primarily attributable to lower hedge fund returns. Net realized and unrealized losses recognized in net income for the quarter were $63 million, including net unrealized losses of $61 million ($55 million excluding foreign exchange movements) following a decrease in the market value of our equity securities portfolio during the quarter, compared to net realized and unrealized gains of $13 million in the first quarter of 2019.

Pre-tax total return on cash and investments4 was (1.7%) including foreign exchange movements ((1.3%) excluding foreign exchange movements5), primarily due to net unrealized losses of $275 million ($224 million excluding foreign exchange movements) following a decrease in the market value of our fixed income portfolio during the quarter. The net unrealized losses of $275 million are net of an allowance for expected credit losses of $20 million and an other than temporary impairment charge for the quarter of $1 million. The prior year pre-tax total return was 2.3% including foreign exchange movements (2.2% excluding foreign exchange movements). Our fixed income portfolio book yield was 2.7% at March 31, 2020 compared to 3.1% at March 31, 2019. The market yield was 2.9% at March 31, 2020.
















4 Pre-tax total return on cash and investments includes net investment income (loss), net investment gains (losses), interest in income (loss) of equity method investments and change in unrealized investment gains (losses) generated by average cash and investment balances. Total cash and invested assets represents the total cash and cash equivalents, fixed maturities, equity securities, mortgage loans, other investments, equity method investments, short-term investments, accrued interest receivable and net receivable (payable) for investments sold (purchased).
5 Pre-tax total return on cash and investments excluding foreign exchange movements is a non-GAAP financial measure as defined in SEC Regulation G. The reconciliation to pre-tax total return on cash and investments, the most comparable GAAP financial measure, also included foreign exchange (losses) gains of $(61)m and $11m for the three months ended March 31, 2020 and 2019, respectively.

AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 9 -


Capitalization / Shareholders’ Equity

Total capital6 at March 31, 2020 was $6.6 billion, including $1.8 billion of debt and $550 million of preferred equity, compared to $7.4 billion at December 31, 2019. The decrease in total capital was attributable to the net loss generated for the three months ended March 31, 2020, net unrealized losses reported in other comprehensive income following a decrease in the market value of our fixed income portfolio, the redemption of our Series D Preferred Shares, and common share dividends declared.

On December 10, 2019, we issued $425 million aggregate principal amount of 4.90% junior subordinated notes. On January 17, 2020, $225 million of the proceeds were used to redeem all of our 5.50% Series D Preferred Shares. We will use the remaining proceeds from the issuance of these notes to repay our 5.875% senior unsecured notes due on June 1, 2020.

Book value per diluted common share, calculated on a treasury stock basis, decreased by $6.01 in the current quarter, and by $3.06 over the past twelve months, to $49.78. The decrease in the quarter was driven by net loss generated, net unrealized losses reported in other comprehensive income, and common share dividends declared, while the decrease in the past twelve months was driven by net unrealized losses reported in other comprehensive income and common share dividends declared.

During the first quarter of 2020, the Company declared dividends of $0.41 per common share, with total dividends declared of $1.62 per common share over the past twelve months. Adjusted for dividends declared, the book value per diluted common share decreased by $5.60, or 10%, for the quarter and decreased by $1.44 or 3%, over the past twelve months.




















6 Total capital represents the sum of total shareholders' equity and debt.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

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Conference Call

We will host a conference call on Tuesday, May 5, 2020 at 9:30 a.m. (EDT) to discuss the first quarter financial results and related matters. The teleconference can be accessed by dialing 1-888-317-6003 (U.S. callers) or 1-412-317-6061 (international callers) approximately ten minutes in advance of the call and entering the passcode 6024972. A live, listen-only webcast of the call will also be available via the Investor Information section of our website at www.axiscapital.com. A replay of the teleconference will be available for two weeks by dialing 1-877-344-7529 (U.S. callers) or 1-412-317-0088 (international callers) and entering the passcode 10142399. The webcast will be archived in the Investor Information section of our website.

In addition, an investor financial supplement relating to our financial results for the quarter ended March 31, 2020 is available in the Investor Information section of our website.

About AXIS Capital
AXIS Capital, through its operating subsidiaries, is a global provider of specialty lines insurance and treaty reinsurance with shareholders' equity at March 31, 2020 of $4.8 billion and locations in Bermuda, the United States, Europe, Singapore, Canada and the Middle East. Its operating subsidiaries have been assigned a rating of "A+" ("Strong") by Standard & Poor's and "A+" ("Superior") by A.M. Best. For more information about AXIS Capital, visit our website at www.axiscapital.com.

Website and Social Media Disclosure
We use our website (www.axiscapital.com) and our corporate Twitter (@AXIS_Capital) and LinkedIn (AXIS Capital) accounts as channels of distribution of Company information. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, e-mail alerts and other information about AXIS Capital may be received when enrolled in our "E-mail Alerts" program, which can be found in the Investor Information section of our website (www.axiscapital.com). The contents of our website and social media channels are not, however, part of this press release.

Please be sure to follow AXIS Capital on LinkedIn.

LinkedIn: http://bit.ly/2kRYbZ5

AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 11 -


AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2020 (UNAUDITED) AND DECEMBER 31, 2019
20202019
(in thousands)
Assets
Investments:
Fixed maturities, available for sale, at fair value
$12,076,186  $12,468,205  
Equity securities, at fair value
404,945  474,207  
Mortgage loans, held for investment, at fair value
517,181  432,748  
Other investments, at fair value
797,808  770,923  
Equity method investments
94,244  117,821  
Short-term investments, at fair value
77,101  38,471  
Total investments13,967,465  14,302,375  
Cash and cash equivalents755,961  1,241,109  
Restricted cash and cash equivalents485,102  335,348  
Accrued interest receivable76,569  78,085  
Insurance and reinsurance premium balances receivable3,485,043  3,071,390  
Reinsurance recoverable on unpaid losses and loss expenses4,101,579  3,877,756  
Reinsurance recoverable on paid losses and loss expenses357,185  327,795  
Deferred acquisition costs611,229  492,119  
Prepaid reinsurance premiums1,281,808  1,101,889  
Receivable for investments sold34,137  35,659  
Goodwill102,003  102,003  
Intangible assets227,821  230,550  
Value of business acquired7,194  8,992  
Operating lease right-of-use assets140,149  111,092  
Other assets315,523  287,892  
             Total assets$25,948,768  $25,604,054  
Liabilities
Reserve for losses and loss expenses$13,082,273  $12,752,081  
Unearned premiums4,395,240  3,626,246  
Insurance and reinsurance balances payable1,263,389  1,349,082  
Debt1,808,645  1,808,157  
Payable for investments purchased123,678  32,985  
Operating lease liabilities143,071  115,584  
Other liabilities292,894  375,911  
             Total liabilities21,109,190  20,060,046  
Shareholders' equity
Preferred shares550,000  775,000  
Common shares2,206  2,206  
Additional paid-in capital2,307,998  2,317,212  
Accumulated other comprehensive income (loss) (89,919) 171,710  
Retained earnings5,836,007  6,056,686  
Treasury shares, at cost(3,766,714) (3,778,806) 
            Total shareholders' equity 4,839,578  5,544,008  
           Total liabilities and shareholders' equity$25,948,768  $25,604,054  

AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 12 -


AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019
Three months ended
20202019
(in thousands, except per share amounts)
Revenues
Net premiums earned$1,088,625  $1,134,212  
Net investment income93,101  107,303  
Net investment gains (losses) (62,877) 12,767  
Other insurance related income (loss) (8,707) 6,929  
Total revenues1,110,142  1,261,211  
Expenses
Net losses and loss expenses908,073  664,028  
Acquisition costs238,650  260,418  
General and administrative expenses157,060  175,091  
Foreign exchange losses (gains) (61,683) 7,056  
Interest expense and financing costs23,472  15,895  
Reorganization expenses(982) 14,820  
Amortization of value of business acquired1,799  13,104  
Amortization of intangible assets2,870  3,003  
Total expenses1,269,259  1,153,415  
Income (loss) before income taxes and interest in income (loss) of equity method investments (159,117) 107,796  
Income tax (expense) benefit 4,867  (1,234) 
Interest in income (loss) of equity method investments (23,577) 2,219  
Net income (loss) (177,827) 108,781  
Preferred share dividends7,563  10,656  
Net income (loss) available (attributable) to common shareholders $(185,390) $98,125  
Per share data
 Earnings (loss) per common share:
   Earnings (loss) per common share$(2.20) $1.17  
   Earnings (loss) per diluted common share$(2.20) $1.16  
 Weighted average common shares outstanding
84,094  83,725  
 Weighted average diluted common shares outstanding
84,094  84,272  
 Cash dividends declared per common share
$0.41  $0.40  




AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 13 -


AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED SEGMENTAL DATA (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019
20202019
InsuranceReinsuranceTotalInsuranceReinsuranceTotal
(in thousands)
Gross premiums written$940,715  $1,490,443  $2,431,158  $851,096  $1,732,130  $2,583,226  
Net premiums written581,650  1,097,394  1,679,044  529,239  1,247,820  1,777,059  
Net premiums earned562,064  526,561  1,088,625  556,762  577,450  1,134,212  
Other insurance related income (loss)647  (9,354) (8,707) 1,742  5,187  6,929  
Net losses and loss expenses(471,812) (436,261) (908,073) (313,776) (350,252) (664,028) 
Acquisition costs(112,751) (125,899) (238,650) (117,775) (142,643) (260,418) 
Underwriting-related general and
administrative expenses(7)
(100,778) (29,184) (129,962) (106,034) (32,839) (138,873) 
Underwriting income (loss) (8)
$(122,630) $(74,137) (196,767) $20,919  $56,903  77,822  
Net investment income  93,101  107,303  
Net investment gains (losses) (62,877) 12,767  
Corporate expenses(7)
(27,098) (36,218) 
Foreign exchange (losses) gains 61,683  (7,056) 
Interest expense and financing costs(23,472) (15,895) 
Reorganization expenses982  (14,820) 
Amortization of value of business acquired  (1,799) (13,104) 
Amortization of intangible assets(2,870) (3,003) 
Income (loss) before income taxes and interest in income (loss) of equity method investments $(159,117) $107,796  
Net losses and loss expenses ratio83.9 %82.9 %83.4 %56.4 %60.7 %58.5 %
Acquisition cost ratio20.1 %23.9 %21.9 %21.2 %24.7 %23.0 %
General and administrative
expense ratio
17.9 %5.5 %14.5 %19.0 %5.6 %15.4 %
Combined ratio
121.9 %112.3 %119.8 %96.6 %91.0 %96.9 %
7Underwriting-related general and administrative expenses is a non-GAAP financial measure as defined in SEC Regulation G. The reconciliation to general and administrative expenses, the most comparable GAAP financial measure, also included corporate expenses of $27 million and $36 million for the three months ended March 31, 2020 and 2019, respectively. Underwriting-related general and administrative expenses and corporate expenses are included in the general and administrative expense ratio.
8Consolidated underwriting income (loss) is a non-GAAP financial measure as defined in SEC Regulation G. The reconciliation to income (loss) before income taxes and interest in income (loss) of equity method investments, the most comparable GAAP financial measure, is presented above.




AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

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AXIS CAPITAL HOLDINGS LIMITED
NON-GAAP FINANCIAL MEASURES RECONCILIATION (UNAUDITED)
OPERATING INCOME AND OPERATING RETURN ON AVERAGE COMMON EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019
Three months ended
20202019
(in thousands, except per share amounts)
Net income (loss) available (attributable) to common shareholders $(185,390) $98,125  
Net investment (gains) losses(9)
62,877  (12,767) 
Foreign exchange losses (gains)(10)
(61,683) 7,056  
Reorganization expenses(11)
(982) 14,820  
Interest in (income) loss of equity method investments (12)
23,577  (2,219) 
Income tax benefit(2,811) (405) 
Operating income (loss) $(164,412) $104,610  
Earnings (loss) per diluted common share $(2.20) $1.16  
Net investment (gains) losses 0.75  (0.15) 
Foreign exchange losses (gains) (0.73) 0.08  
Reorganization expenses  (0.01) 0.18  
Interest in (income) loss of equity method investments 0.28  (0.03) 
Income tax benefit  (0.03) —  
Operating income (loss) per diluted common share $(1.94) $1.24  
Weighted average diluted common shares outstanding84,094  84,272  
Average common shareholders' equity4,529,293  4,390,114  
Annualized return on average common equitynm  8.9 %
Annualized operating return on average common equity(13)
nm  9.5 %
9Tax cost (benefit) of ($5,677) and $2,835 for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors including the ability to utilize capital losses.
10Tax cost (benefit) of $2,527 and ($582) for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions, after consideration of other relevant factors including the tax status of specific foreign exchange transactions.
11Tax cost (benefit) of $339 and $(2,658) for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions.
12Tax cost (benefit) of $nil for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions.
13Annualized operating return on average common equity ("operating ROACE") is a non-GAAP financial measure as defined in SEC Regulation G. The reconciliation to annualized ROACE, the most comparable GAAP financial measure is presented in the table above, and a discussion of the rationale for its presentation is provided later in this release.




AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 15 -


AXIS CAPITAL HOLDINGS LIMITED
NON-GAAP FINANCIAL MEASURES RECONCILIATION (UNAUDITED)
EX-PGAAP OPERATING INCOME AND EX-PGAAP OPERATING RETURN ON AVERAGE COMMON EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019
Three months ended
20202019
(in thousands, except per share amounts)
Net income (loss) available (attributable) to common shareholders $(185,390) $98,125  
Net investment (gains) losses(9)
62,877  (12,767) 
Foreign exchange losses (gains)(10)
(61,683) 7,056  
Reorganization expenses(11)
(982) 14,820  
Interest in (income) loss of equity method investments (12)
23,577  (2,219) 
Income tax benefit(2,811) (405) 
Operating income (loss) $(164,412) $104,610  
Amortization of VOBA and intangible assets(14)
4,697  16,002  
Amortization of acquisition costs(15)
(478) (6,267) 
Income tax benefit  (801) (1,849) 
Ex-PGAAP operating income (loss)(2)
$(160,994) $112,496  
Earnings (loss) per diluted common share $(2.20) $1.16  
Net investment (gains) losses  0.75  (0.15) 
Foreign exchange losses (gains) (0.73) 0.08  
Reorganization expenses  (0.01) 0.18  
Interest in (income) loss of equity method investments 0.28  (0.03) 
Income tax benefit  (0.03) —  
Operating income (loss) per diluted common share $(1.94) $1.24  
Amortization of VOBA and intangible assets0.06  0.19  
Amortization of acquisition costs  (0.01) (0.07) 
Income tax benefit  (0.01) (0.02) 
Ex-PGAAP operating income (loss) per diluted common share(2)
$(1.90) $1.33  
Weighted average diluted common shares outstanding84,094  84,272  
Average common shareholders' equity4,529,293  4,390,114  
Annualized return on average common equitynm  8.9 %
Annualized operating return on average common equity(13)
nm  9.5 %
Annualized ex-PGAAP operating return on average common equity(2)
nm  10.2 %
14Tax (benefit) of $(892) and $(3,040) for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions.
15Tax cost of $91 and $1,191 for the three months ended March 31, 2020 and 2019, respectively. Tax impact is estimated by applying the statutory rates of applicable jurisdictions.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 16 -


Risk and Uncertainties
The determination of the Company's net claims provision for its insurance segment is based on its ground-up assessment of losses from individual contracts and treaties, including a review of contracts with potential exposure to the COVID-19 pandemic. The determination of the Company's net claims provision for its reinsurance segment is largely based on industry insured loss estimates, market share analyses and catastrophe modeling analyses, where appropriate. In addition, the Company considered preliminary information received from clients, brokers and loss adjusters. Due to the nature of these events, including the complexity of loss assessment, factors contributing to the net claims provision, and the preliminary nature of the information available to prepare the estimate of the net claims provision, particularly related to the COVID-19 pandemic, the actual net ultimate amount of the loss for these events may differ materially from this current net claims provision.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts included in this press release, including statements regarding our estimates, beliefs, expectations, intentions, strategies or projections are forward-looking statements. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the United States federal securities laws. In some cases, these statements can be identified by the use of forward-looking words such as "may", "should", "could", "anticipate", "estimate", "expect", "plan", "believe", "predict", "potential", "intend" or similar expressions. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond management's control.

Forward-looking statements contained in this press release may include, but are not limited to, information regarding our estimates of losses related to catastrophes and other large losses including losses related to the COVID-19 pandemic, measurements of potential losses in the fair market value of our investment portfolio and derivative contracts, our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, the outcome of our strategic initiatives, our expectations regarding estimated synergies and the success of the integration of acquired entities, our expectations regarding the estimated benefits and synergies related to our transformation program, our expectations regarding pricing and other market conditions, our growth prospects, and valuations of the potential impact of movements in interest rates, equity securities' prices, credit spreads and foreign currency rates.

Forward-looking statements only reflect our expectations and are not guarantees of performance. These statements involve risks, uncertainties and assumptions. Accordingly, there are or will be important factors that could cause actual events or results to differ materially from those indicated in such statements. We believe that these factors include, but are not limited to, the following:
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 17 -



the adverse impact of the recent COVID-19 outbreak and resulting pandemic;
the cyclical nature of the insurance and reinsurance business leading to periods with excess underwriting capacity and unfavorable premium rates;
the occurrence and magnitude of natural and man-made disasters;
the impact of global climate change on our business, including the possibility that we do not adequately assess or reserve for the increased frequency and severity of natural catastrophes;
losses from war, terrorism and political unrest or other unanticipated losses;
actual claims exceeding our loss reserves;
general economic, capital and credit market conditions;
the failure of any of the loss limitation methods we employ;
the effects of emerging claims, coverage and regulatory issues, including uncertainty related to coverage definitions, limits, terms and conditions;
our inability to purchase reinsurance or collect amounts due to us;
the breach by third parties in our program business of their obligations to us;
difficulties with technology and/or data security;
the failure of our policyholders and intermediaries to pay premiums;
the failure of our cedants to adequately evaluate risks;
inability to obtain additional capital on favorable terms, or at all;
the loss of one or more of our key executives;
a decline in our ratings with rating agencies;
the loss of business provided to us by our major brokers and credit risk due to our reliance on brokers;
changes in accounting policies or practices;
the use of industry catastrophe models and changes to these models;
changes in governmental regulations and potential government intervention in our industry;
failure to comply with certain laws and regulations relating to sanctions and foreign corrupt practices;
increased competition;
changes in the political environment of certain countries in which we operate or underwrite business including the United Kingdom's withdrawal from the European Union;
fluctuations in interest rates, credit spreads, equity securities' prices and/or currency values;
the failure to successfully integrate acquired businesses or to realize the expected synergies resulting from such acquisitions;
the failure to realize the expected benefits or synergies relating to our transformation initiative;
changes in tax laws; and
other factors including but not limited to those described under Item 1A, 'Risk Factors' in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC"), as those factors may be updated from time to time in our periodic and other filings with the SEC (including as those
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 18 -


factors are updated in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2020). These filings are accessible on the SEC's website at www.sec.gov. Readers are urged to carefully consider all such factors and we note that the COVID-19 pandemic may have the effect of heightening many of the risks and uncertainties described.

We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 19 -


Non-GAAP Financial Measures

We present our results of operations in the way we believe will be most meaningful and useful to investors, analysts, rating agencies and others who use our financial information to evaluate our performance. Some of the measurements we use are considered non-GAAP financial measures under SEC rules and regulations. In this press release, we present underwriting-related general and administrative expenses, consolidated underwriting income (loss), operating income (loss) (in total and on a per share basis), annualized operating return on average common equity ("operating ROACE"), pre-tax total return on cash and investments excluding foreign exchange movements, ex-PGAAP operating income (loss) (in total and on a per share basis) and annualized ex-PGAAP operating ROACE which are non-GAAP financial measures as defined in SEC Regulation G. We believe that these non-GAAP financial measures, which may be defined and calculated differently by other companies, better explain and enhance the understanding of our results of operations. However, these measures should not be viewed as a substitute for those determined in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP").

Underwriting-Related General and Administrative Expenses
Underwriting-related general and administrative expenses include those general and administrative expenses that are incremental and/or directly attributable to our underwriting operations. While this measure is presented in the 'Segment Information' note to our Consolidated Financial Statements, it is considered a non-GAAP financial measure when presented elsewhere on a consolidated basis.

Corporate expenses include holding company costs necessary to support our worldwide insurance and reinsurance operations and costs associated with operating as a publicly-traded company. As these costs are not incremental and/or directly attributable to our underwriting operations, these costs are excluded from underwriting-related general and administrative expenses, and therefore, consolidated underwriting income (loss). General and administrative expenses, the most comparable GAAP financial measure to underwriting-related general and administrative expenses, also includes corporate expenses.

The reconciliation of underwriting-related general and administrative expenses to general and administrative expenses, the most comparable GAAP financial measure, is presented in the 'Consolidated Segmental Data' section of this press release.
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 20 -


Consolidated Underwriting Income (Loss)
Consolidated underwriting income (loss) is a pre-tax measure of underwriting profitability that takes into account net premiums earned and other insurance related income (losses) as revenues and net losses and loss expenses, acquisition costs and underwriting-related general and administrative expenses as expenses. While this measure is presented in the 'Segment Information' note to our Consolidated Financial Statements, it is considered a non-GAAP financial measure when presented elsewhere on a consolidated basis.

We evaluate our underwriting results separately from the performance of our investment portfolio. As a result, we believe it is appropriate to exclude net investment income and net investment gains (losses) from our underwriting profitability measure.

Foreign exchange losses (gains) in our consolidated statements of operations primarily relate to the impact of foreign exchange rate movements on our net insurance-related liabilities. However, we manage our investment portfolio in such a way that unrealized and realized foreign exchange losses (gains) on our investment portfolio generally offset a large portion of the foreign exchange losses (gains) arising from our underwriting portfolio. As a result, we believe that foreign exchange losses (gains) are not a meaningful contributor to our underwriting performance, therefore, foreign exchange losses (gains) are excluded from consolidated underwriting income (loss).

Interest expense and financing costs primarily relate to interest payable on our debt. As these expenses are not incremental and/or directly attributable to our underwriting operations, these expenses are excluded from underwriting-related general and administrative expenses, and therefore, consolidated underwriting income (loss).

Reorganization expenses are primarily driven by business decisions, the nature and timing of which are not related to the underwriting process, therefore, these expenses are excluded from consolidated underwriting income (loss).

Amortization of intangible assets including VOBA arose from business decisions, the nature and timing of which are not related to the underwriting process, therefore, these expenses are excluded from consolidated underwriting income (loss).

We believe that the presentation of underwriting-related general and administrative expenses and consolidated underwriting income (loss) provides investors with an enhanced understanding of our results of operations, by highlighting the underlying pre-tax profitability of our underwriting activities. The reconciliation of consolidated underwriting income (loss) to income (loss) before income taxes and interest in income (loss) of equity method
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 21 -


investments, the most comparable GAAP financial measure, is presented in the 'Consolidated Segmental Data' section of this press release.

Operating Income (Loss)
Operating income (loss) represents after-tax operational results exclusive of net investment gains (losses), foreign exchange losses (gains), reorganization expenses, and interest in income (loss) of equity method investments.

Although the investment of premiums to generate income and investment gains (losses) is an integral part of our operations, the determination to realize investment gains (losses) is independent of the underwriting process and is heavily influenced by the availability of market opportunities. Furthermore, many users believe that the timing of the realization of investment gains (losses) is somewhat opportunistic for many companies.

Foreign exchange losses (gains) in our consolidated statements of operations primarily relate to the impact of foreign exchange rate movements on net insurance-related liabilities. In addition, we recognize unrealized foreign exchange losses (gains) on our equity securities and foreign exchange losses (gains) realized on the sale of our available for sale investments and equity securities in net investment gains (losses). We also recognize unrealized foreign exchange losses (gains) on our available for sale investments in other comprehensive income (loss). These unrealized foreign exchange losses (gains) generally offset a large portion of the foreign exchange losses (gains) reported in net income (loss), thereby minimizing the impact of foreign exchange rate movements on total shareholders’ equity. As a result, foreign exchange losses (gains) in our consolidated statements of operations in isolation are not a fair representation of the performance of our business.

Reorganization expenses are primarily driven by business decisions, the nature and timing of which are not related to the underwriting process, therefore, these expenses are excluded from operating income (loss).

Interest in income (loss) of equity method investments is primarily driven by business decisions, the nature and timing of which are not related to the underwriting process, therefore, this income (loss) is excluded from operating income (loss).

Certain users of our financial statements evaluate performance exclusive of after-tax net investment gains (losses), foreign exchange losses (gains), reorganization expenses, and interest in income (loss) of equity method investments to understand the profitability of recurring sources of income.

We believe that showing net income (loss) available (attributable) to common shareholders exclusive of after-tax net investment gains (losses), foreign exchange losses (gains), reorganization expenses, and interest in income (loss) of equity method investments reflects the underlying fundamentals of our business. In addition, we believe
AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 22 -


that this presentation enables investors and other users of our financial information to analyze performance in a manner similar to how our management analyzes the underlying business performance. We also believe this
measure follows industry practice and, therefore, facilitates comparison of our performance with our peer group. We believe that equity analysts and certain rating agencies that follow us, and the insurance industry as a whole, generally exclude these items from their analyses for the same reasons. The reconciliation of operating income (loss) to net income (loss) available (attributable) to common shareholders, the most comparable GAAP financial measure, is presented in the 'Non-GAAP Financial Measures Reconciliation' section of this press release.

We also present operating income (loss) per diluted common share and annualized operating ROACE, which are derived from the operating income (loss) measure and are reconciled to the most comparable GAAP financial measures, earnings (loss) per diluted common share and annualized return on average common equity ("ROACE"), respectively, in the 'Non-GAAP Financial Measures Reconciliation' section of this press release.

Pre-Tax Total Return on Cash and Investments excluding Foreign Exchange Movement
Pre-tax total return on cash and investments excluding foreign exchange movements measures net investment income (loss), net investments gains (losses), interest in income (loss) of equity method investments, and change in unrealized gains (losses) generated by average cash and investment balances. The reconciliation of pre-tax total return on cash and investments excluding foreign exchange movements to pre-tax total return on cash and investments, the most comparable GAAP financial measure, is presented in the 'Investments' section of this press release. We believe this presentation enables investors and other users of our financial information to analyze the performance of our investment portfolio.

Ex-PGAAP Operating Income (Loss)
Ex-PGAAP operating income (loss) represents operating income (loss) exclusive of after-tax amortization of VOBA and intangible assets, and after-tax amortization of acquisition costs, both associated with Novae's balance sheet at October 2, 2017 (the "closing date" or "acquisition date"). The reconciliation of ex-PGAAP operating income (loss) to net income (loss) available (attributable) to common shareholders, the most comparable GAAP financial measure, is presented in the 'Non-GAAP Financial Measures Reconciliation' section of this press release.

We also present ex-PGAAP operating income (loss) per diluted common share and annualized ex-PGAAP operating ROACE, which are derived from the ex-PGAAP operating income (loss) measure and are reconciled to the most comparable GAAP financial measures, earnings (loss) per diluted common share and annualized ROACE, respectively, in the 'Non-GAAP Financial Measures Reconciliation' section of this press release.

AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 23 -


We believe the presentation of ex-PGAAP operating income (loss), ex-PGAAP operating income (loss) per diluted common share and annualized ex-PGAAP operating ROACE enables investors and other users of our financial information to analyze the performance of our business.

Acquisition of Novae
On October 2, 2017, we acquired Novae. At the acquisition date, we identified VOBA which represents the present value of the expected underwriting profit within policies that were in-force at the closing date of the transaction. In addition, the allocation of the acquisition price to the assets acquired and liabilities assumed based on estimated fair values at the acquisition date, resulted in the write-off of the deferred acquisition cost asset on Novae's balance sheet at the acquisition date as the value of policies in-force on that date are considered within VOBA. Consequently, underwriting income (loss) in the three months ended March 31, 2020 and 2019 included the recognition of premiums attributable to Novae's balance sheet at the acquisition date without the recognition of the associated acquisition costs.








AXIS Capital Holdings Limited 92 Pitts Bay Road Pembroke, Bermuda HM08
Tel. 441.496.2600 Fax 441.405.2600
www.axiscapital.com

- 24 -
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Section 3: EX-99.2 (EX-99.2)

Document






 

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AXIS CAPITAL HOLDINGS LIMITED








INVESTOR FINANCIAL SUPPLEMENT

FIRST QUARTER 2020


1










AXIS Capital Holdings Limited
92 Pitts Bay Road
Pembroke HM 08 Bermuda
Contact Information:
Matthew Rohrmann
Investor Contact
(212) 940-3339
investorrelations@axiscapital.com
Website Information:
www.axiscapital.com
This report is for informational purposes only. It should be read in conjunction with the documents that the Company files with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934.

2

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AXIS CAPITAL HOLDINGS LIMITED
FINANCIAL SUPPLEMENT TABLE OF CONTENTS
   Page(s)
  
i - iv
  
II. Income Statements  
  
  
  
  
  
III. Balance Sheets  
  
b. Cash and Invested Assets:  
  
  
  
  
  
  
IV. Losses Reserve Analysis  
  
  
  

  
V. Share Analysis  
  
  
  
VI. Non-GAAP Financial Measures  
  

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AXIS CAPITAL HOLDINGS LIMITED
BASIS OF PRESENTATION

AXIS Capital Holdings Limited's ("AXIS Capital" or the "Company") underwriting operations are organized around its global underwriting platforms, AXIS Insurance and AXIS Re. The Company has determined that it has two reportable segments, insurance and reinsurance.

DEFINITIONS AND PRESENTATION
All financial information contained herein is unaudited, except for the consolidated balance sheet at December 31, 2019.
Amounts may not reconcile due to rounding differences.
Unless otherwise noted, all data is in thousands, except for ratio information.
NM - Not meaningful; NA - Not applicable

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements within the meaning of section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts included in this document, including statements regarding our estimates, beliefs, expectations, intentions, strategies or projections are forward-looking statements. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the United States federal securities laws. In some cases, these statements can be identified by the use of forward-looking words such as "may", "should", "could", "anticipate", "estimate", "expect", "plan", "believe", "predict", "potential", "intend" or similar expressions. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond management's control.
Forward-looking statements contained in this document may include, but are not limited to, information regarding our estimates of losses related to catastrophes and other large losses including losses related to the COVID-19 pandemic, measurements of potential losses in the fair market value of our investment portfolio and derivative contracts, our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, the outcome of our strategic initiatives, our expectations regarding estimated synergies and the success of the integration of acquired entities, our expectations regarding the estimated benefits and synergies related to our transformation program, our expectations regarding pricing and other market conditions, our growth prospects, and valuations of the potential impact of movements in interest rates, equity securities' prices, credit spreads and foreign currency rates.

Forward-looking statements only reflect our expectations and are not guarantees of performance. These statements involve risks, uncertainties and assumptions. Accordingly, there are or will be important factors that could cause actual events or results to differ materially from those indicated in such statements. We believe that these factors include, but are not limited to, the following:

the adverse impact of the recent COVID-19 outbreak and resulting pandemic;
the cyclical nature of the insurance and reinsurance business leading to periods with excess underwriting capacity and unfavorable premium rates;
the occurrence and magnitude of natural and man-made disasters;
the impact of global climate change on our business, including the possibility that we do not adequately assess or reserve for the increased frequency and severity of natural catastrophes;
losses from war, terrorism and political unrest or other unanticipated losses;
actual claims exceeding our loss reserves;
general economic, capital and credit market conditions;
the failure of any of the loss limitation methods we employ;
the effects of emerging claims, coverage and regulatory issues, including uncertainty related to coverage definitions, limits, terms and conditions;
our inability to purchase reinsurance or collect amounts due to us;
the breach by third parties in our program business of their obligations to us;
difficulties with technology and/or data security;
the failure of our policyholders and intermediaries to pay premiums;
the failure of our cedants to adequately evaluate risks;
inability to obtain additional capital on favorable terms, or at all;
the loss of one or more of our key executives;
a decline in our ratings with rating agencies;
the loss of business provided to us by our major brokers and credit risk due to our reliance on brokers;
changes in accounting policies or practices;
the use of industry catastrophe models and changes to these models;
changes in governmental regulations and potential government intervention in our industry;
failure to comply with certain laws and regulations relating to sanctions and foreign corrupt practices;
i

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increased competition;
changes in the political environment of certain countries in which we operate or underwrite business including the United Kingdom's withdrawal from the European Union;
fluctuations in interest rates, credit spreads, equity securities' prices and/or currency values;
the failure to successfully integrate acquired businesses or to realize the expected synergies resulting from such acquisitions;
the failure to realize the expected benefits or synergies relating to our transformation initiative;
changes in tax laws; and
other factors including but not limited to those described under Item 1A, 'Risk Factors' in our most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC"), as those factors may be updated from time to time in our periodic and other filings with the SEC (including as those factors are updated in the Company’s Quarterly Report on Form 10-Q for the three months ended March 31, 2020). These filings are accessible on the SEC's website at www.sec.gov. Readers are urged to carefully consider all such factors and we note that the COVID-19 pandemic may have the effect of heightening many of the risks and uncertainties described.

We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
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AXIS CAPITAL HOLDINGS LIMITED
BASIS OF PRESENTATION
BUSINESS DESCRIPTIONS

INSURANCE SEGMENT

Our insurance segment offers specialty insurance products to a variety of niche markets on a worldwide basis. The following are the lines of business in our insurance segment:
Property: provides physical loss or damage, business interruption and machinery breakdown cover for virtually all types of property, including commercial buildings, residential premises, construction projects and onshore renewable energy installations. This line of business includes primary and excess risks, some of which are catastrophe-exposed.
Marine: provides cover for traditional marine classes, including offshore energy, cargo, liability, recreational marine, fine art, specie, and hull and war. Offshore energy coverage includes physical damage, business interruption, operator's extra expense and liability coverage for all aspects of offshore upstream energy, from exploration and construction through the operation and distribution phases.
Terrorism: provides cover for physical damage and business interruption of an insured following an act of terrorism and includes kidnap and ransom, and crisis management insurance.
Aviation: provides hull and liability, and specific war cover primarily for passenger airlines but also for cargo operations, general aviation operations, airports, aviation authorities, security firms and product manufacturers.
Credit and Political Risk: provides credit and political risk insurance products for banks, commodity traders, corporations and multilateral and export credit agencies. Cover is provided for a range of risks including sovereign default, credit default, political violence, currency inconvertibility and non-transfer, expropriation, aircraft non-repossession and contract frustration due to political events.
Professional Lines: provides directors’ and officers’ liability, errors and omissions liability, employment practices liability, fiduciary liability, crime, professional indemnity, cyber and privacy insurance, medical malpractice and other financial insurance related covers for commercial enterprises, financial institutions, not-for-profit organizations and other professional service providers. This business is predominantly written on a claims-made basis.
Liability: primarily targets primary and low to mid-level excess and umbrella commercial liability risks in the U.S. wholesale markets in addition to primary and excess of loss employers, public, and products liability predominately in the U.K. Target industry sectors include construction, manufacturing, transportation and trucking, and other services.
Accident and Health: includes accidental death, travel insurance and specialty health products for employer and affinity groups.
Discontinued Lines - Novae: includes those lines of business that Novae exited or placed into run-off in the fourth quarter of 2016 and in the first quarter of 2017. These discontinued insurance lines include financial institutions, professional indemnity, international liability, and international direct and facultative property.


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AXIS CAPITAL HOLDINGS LIMITED
BASIS OF PRESENTATION
 
BUSINESS DESCRIPTIONS (CONTINUED)

REINSURANCE SEGMENT

Our reinsurance segment provides treaty reinsurance to insurance companies on a worldwide basis. The following are the lines of business in our reinsurance segment:

Catastrophe: provides protection for most catastrophic losses that are covered in the underlying insurance policies written by our cedants. The underlying policies principally cover property-related exposures but other exposures including workers compensation and personal accident are also covered. The principal perils covered by policies in this portfolio include hurricane and windstorm, earthquake, flood, tornado, hail and fire. In some instances, terrorism may be a covered peril or the only peril. This business is written on a proportional and excess of loss basis.
Property: provides protection for property damage and related losses resulting from natural and man-made perils that are covered in the underlying personal and commercial lines insurance policies written by our cedants. The predominant exposure is property damage but other risks, including business interruption and other non-property losses, may also be covered when arising from a covered peril. The most significant perils covered by policies in this portfolio include windstorm, tornado and earthquake, but other perils such as freezes, riots, flood, industrial explosions, fire, hail and a number of other loss events are also included. This business is written on a proportional and excess of loss basis.
Professional Lines: provides protection for directors’ and officers’ liability, employment practices liability, medical malpractice, professional indemnity, environmental liability, cyber and miscellaneous errors and omissions insurance risks. The underlying business is predominantly written on a claims-made basis. This business is written on a proportional and excess of loss basis.
Credit and Surety: provides reinsurance of trade credit insurance products and includes proportional and excess of loss structures. The underlying insurance indemnifies sellers of goods and services in the event of a payment default by the buyer of those goods and services. Surety reinsurance provides protection for losses arising from a broad array of surety bonds issued by insurers to satisfy regulatory demands or contract obligations in a variety of jurisdictions around the world. Mortgage reinsurance is also provided to mortgage guaranty insurers and U.S. government sponsored entities for losses related to credit risk transfer into the private sector.
Motor: provides protection to insurers for motor liability and property damage losses arising out of any one occurrence. A loss occurrence can involve one or many claimants where the ceding insurer aggregates the claims from the occurrence. Traditional proportional and non-proportional reinsurance as well as structured solutions are offered.
Liability: provides protection to insurers of admitted casualty business, excess and surplus lines casualty business and specialty casualty programs. The primary focus of the underlying business is general liability, workers' compensation, auto liability, and excess casualty.
Agriculture: provides protection for risks associated with the production of food and fiber on a global basis for primary insurance companies writing multi-peril crop insurance, crop hail, and named peril covers, as well as custom risk transfer mechanisms for agricultural dependent industries with exposures to crop yield and/or price deviations. This business is written on a proportional and aggregate stop loss reinsurance basis.
Engineering: provides protection for all types of construction risks and risks associated with erection, testing and commissioning of machinery and plants during the construction stage. This line of business also includes cover for losses arising from operational failures of machinery, plant and equipment, and electronic equipment as well as business interruption.
Marine and Other: includes marine and aviation reinsurance.
Accident and Health: includes personal accident, specialty health, accidental death, travel, life and disability reinsurance products which are offered on a proportional and catastrophic or per life excess of events loss basis.
Discontinued Lines - Novae: includes those lines of business that Novae exited or placed into run-off in the fourth quarter of 2016 and in the first quarter of 2017. These discontinued reinsurance lines include motor reinsurance, general liability reinsurance, and international facultative property.



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AXIS CAPITAL HOLDINGS LIMITED
FINANCIAL HIGHLIGHTS
  Three months ended March 31,
  20202019Change
HIGHLIGHTSGross premiums written$2,431,158  $2,583,226  (5.9 %)
Gross premiums written - Insurance38.7 %32.9 %5.8  pts
Gross premiums written - Reinsurance61.3 %67.1 %(5.8) pts
Net premiums written$1,679,044  $1,777,059  (5.5 %)
Net premiums earned$1,088,625  $1,134,212  (4.0 %)
Net premiums earned - Insurance51.6 %49.1 %2.5  pts
Net premiums earned - Reinsurance48.4 %50.9 %(2.5) pts
Net income (loss) available (attributable) to common shareholders $(185,390) $98,125  nm  
Operating income (loss) [a]
(164,412) 104,610  nm  
Annualized return on average common equity [b]
nm  8.9 %nm  pts
Annualized operating return on average common equity [c]
nm  9.5 %nm  pts  
Total shareholders’ equity$4,839,578  $5,300,156  (8.7 %)
PER COMMON SHARE AND COMMON SHARE DATAEarnings (loss) per diluted common share ($2.20) $1.16  nm  
Operating income (loss) per diluted common share [d]
($1.94) $1.24  nm  
Weighted average diluted common shares outstanding84,094  84,272  (0.2 %)
Book value per common share$50.89  $53.91  (5.6 %)
Book value per diluted common share (treasury stock method)$49.78  $52.84  (5.8 %)
Tangible book value per diluted common share (treasury stock method) [a]
$46.45  $49.37  (5.9 %)
FINANCIAL RATIOSCurrent accident year loss ratio excluding catastrophe and weather-related losses57.1 %58.9 %(1.8) pts
Catastrophe and weather-related losses ratio26.9 %0.9 %26.0  pts
Current accident year loss ratio84.0 %59.8 %24.2  pts
Prior year reserve development ratio(0.6 %)(1.3 %)0.7  pts
Net losses and loss expenses ratio83.4 %58.5 %24.9  pts
Acquisition cost ratio21.9 %23.0 %(1.1) pts
General and administrative expense ratio [e]
14.5 %15.4 %(0.9) pts
Combined ratio119.8 %96.9 %22.9  pts
INVESTMENT DATATotal assets$25,948,768  $25,557,582  1.5 %
Total cash and invested assets [f]
15,195,556  15,090,504  0.7 %
Net investment income  93,101  107,303  (13.2 %)
Net investment gains (losses) (62,877) 12,767  nm  
Book yield of fixed maturities2.7 %3.1 %(0.4) pts
[a] Operating income (loss), operating income (loss) per diluted common share, annualized operating return on average common equity ("operating ROACE") and tangible book value per diluted common
share are non-GAAP financial measures as defined by Regulation G. The reconciliations to the most comparable GAAP financial measures, net income (loss) available (attributable) to common
shareholders, earnings (loss) per diluted common share, annualized return on average common equity ("ROACE") and book value per diluted common share, respectively, and a discussion of the rationale
for the presentation of these items are provided later in this document. Loss per diluted common share and operating loss per diluted common share for the three months ended March 31, 2020, were
calculated using weighted average common shares outstanding due to the net loss attributable to common shareholders and operating loss recognized in the period.
[b] Annualized ROACE is calculated by dividing annualized net income (loss) available (attributable) to common shareholders for the period by the average common shareholders’ equity determined using the
common shareholders’ equity balances at the beginning and end of the period.
[c] Annualized operating ROACE is calculated by dividing annualized operating income (loss) for the period by the average common shareholders’ equity determined using the common shareholders’ equity balances at the beginning and end of the period.
[d] Operating income (loss) per diluted common share is calculated by dividing operating income (loss) for the period by weighted average diluted common shares outstanding.
[e] Underwriting-related general and administrative expenses and corporate expenses are included in the general and administrative expense ratio.
[f] Total cash and invested assets represents the total cash and cash equivalents, fixed maturities, equity securities, mortgage loans, other investments, equity method investments, short-term investments, accrued interest receivable and net receivable (payable) for investments sold (purchased).
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AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS - AS REPORTED, U.S. GAAP
FOR THE THREE MONTHS ENDED MARCH 31, 2020 AND 2019
Three months ended March 31,
20202019
Revenues
Net premiums earned$1,088,625  $1,134,212  
Net investment income93,101  107,303  
Net investment gains (losses) (62,877) 12,767  
Other insurance related income (loss) (8,707) 6,929  
Total revenues1,110,142  1,261,211  
Expenses
Net losses and loss expenses908,073  664,028  
Acquisition costs238,650  260,418  
General and administrative expenses157,060  175,091  
Foreign exchange losses (gains) (61,683) 7,056  
Interest expense and financing costs23,472  15,895  
Reorganization expenses(982) 14,820  
Amortization of value of business acquired1,799  13,104  
Amortization of intangible assets2,870  3,003  
Total expenses1,269,259  1,153,415  
Income (loss) before income taxes and interest in income (loss) of equity method investments (159,117) 107,796  
Income tax (expense) benefit 4,867  (1,234) 
Interest in income (loss) of equity method investments (23,577) 2,219  
Net income (loss) (177,827) 108,781  
Preferred share dividends7,563  10,656  
Net income (loss) available (attributable) to common shareholders $(185,390) $98,125  




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AXIS CAPITAL HOLDINGS LIMITED
CONSOLIDATED STATEMENTS OF OPERATIONS - QUARTER
Q1 2020Q4 2019Q3 2019Q2 2019Q1 2019Q1 2018
UNDERWRITING REVENUES
Gross premiums written$2,431,158  $1,261,366  $1,406,506  $1,647,760  $2,583,226  $2,662,795  
Ceded premiums written(752,114) (475,212) (550,425) (577,439) (806,167) (676,924) 
Net premiums written1,679,044  786,154  856,081  1,070,321  1,777,059  1,985,871  
Gross premiums earned1,657,412  1,789,084  1,756,116  1,680,663  1,684,814  1,639,833  
Ceded premiums earned(568,787) (617,033) (598,809) (557,056) (550,602) (472,431) 
Net premiums earned1,088,625  1,172,051  1,157,307  1,123,607  1,134,212