0000776867-19-000029.txt : 20191106 0000776867-19-000029.hdr.sgml : 20191106 20191106082347 ACCESSION NUMBER: 0000776867-19-000029 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 20191106 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20191106 DATE AS OF CHANGE: 20191106 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WHITE MOUNTAINS INSURANCE GROUP LTD CENTRAL INDEX KEY: 0000776867 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 942708455 STATE OF INCORPORATION: D0 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08993 FILM NUMBER: 191195149 BUSINESS ADDRESS: STREET 1: 80 SOUTH MAIN ST CITY: HANOVER STATE: NH ZIP: 03755 BUSINESS PHONE: 603 640 2200 MAIL ADDRESS: STREET 1: 80 SOUTH MAIN STREET CITY: HANOVER STATE: NH ZIP: 03755 FORMER COMPANY: FORMER CONFORMED NAME: WHITE MOUNTAINS INSURANCE GROUP INC DATE OF NAME CHANGE: 19990603 FORMER COMPANY: FORMER CONFORMED NAME: FUND AMERICAN ENTERPRISES HOLDINGS INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: FUND AMERICAN COMPANIES INC DATE OF NAME CHANGE: 19920701 8-K 1 wtm-20191106.htm 8-K Document
FALSE000077686700007768672019-11-062019-11-06

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

November 6, 2019
Date of Report (Date of earliest event reported)

WHITE MOUNTAINS INSURANCE GROUP, LTD.
(Exact name of registrant as specified in its charter)

Bermuda
(State or other jurisdiction of
 incorporation or organization)
1-8993
(Commission file number)
94-2708455
(I.R.S. Employer Identification No.)

80 South Main Street, Hanover, New Hampshire 03755
(Address of principal executive offices)

(603) 640-2200
(Registrant’s telephone number, including area code)

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:

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 classTrading Symbol(s)Name of each exchange on which registered
Common Shares, par value $1.00WTMNew York Stock Exchange
per shareBermuda 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(§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.   o



ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

On November 6, 2019, White Mountains Insurance Group, Ltd. issued a press release announcing its results for the three and nine months ended September 30, 2019. The press release furnished herewith is attached as Exhibit 99.1 to this Form 8-K. Certain information included in the press release constitutes non-GAAP financial measures (as defined in Regulation G of the Securities and Exchange Commission). Specifically, the seven non-GAAP financial measures disclosed in the press release include (i) adjusted book value per share, (ii) underlying growth in adjusted book value per share, (iii) gross written premiums and member surplus contributions (“MSC”) from new business, (iv) NSM’s earnings before interest, taxes, depreciation and amortization (“EBITDA”), (v) NSM’s adjusted EBITDA, (vi) NSM’s pro forma adjusted EBITDA, and (vii) total consolidated portfolio returns excluding the MediaAlpha Transaction. These non-GAAP financial measures have been reconciled to their most comparable GAAP financial measures.
Adjusted book value per share is a non-GAAP financial measure which is derived by adjusting (i) the GAAP book value per share numerator and (ii) the common shares outstanding denominator, as described below. The GAAP book value per share numerator is adjusted (i) to include a discount for the time value of money arising from the expected timing of cash payments of principal and interest on the BAM surplus notes and (ii) to add back the unearned premium reserve, net of deferred acquisition costs, at HG Global. Under GAAP, White Mountains is required to carry the BAM surplus notes, including accrued interest, at nominal value with no consideration for time value of money. Based on a debt service model that forecasts operating results for BAM through maturity of the surplus notes, the present value of the BAM surplus notes, including accrued interest, was estimated to be $137 million, $140 million, $146 million and $151 million less than the nominal GAAP carrying values as of September 30, 2019, June 30, 2019, December 31, 2018, and September 30, 2018, respectively. The value of HG Global’s unearned premium reserve, net of deferred acquisition costs, was $122 million, $113 million, $106 million and $94 million as of September 30, 2019, June 30, 2019, December 31, 2018, and September 30, 2018, respectively. White Mountains believes these adjustments are useful to management and investors in analyzing the intrinsic value of HG Global, including the value of the surplus notes and the value of the in-force business at HG Re, HG Global’s reinsurance subsidiary. The denominator used in the calculation of adjusted book value per share equals the number of common shares outstanding adjusted to exclude unearned restricted common shares, the compensation cost of which, at the date of calculation, has yet to be amortized. Restricted common shares are earned on a straight-line basis over their vesting periods. The reconciliation of GAAP book value per share to adjusted book value per share is included on page 6 of Exhibit 99.1 to this Form 8-K.
The growth in adjusted book value per share on page 1 of Exhibit 99.1 reflects the estimated gain from the MediaAlpha transaction as if it had closed on December 31, 2018. A reconciliation from GAAP to the reported percentage is as follows:
As of
September 30, 2019
As of
December 31, 2018
Growth % (1)
GAAP book value per share$1,002.53  $896.00  12.0 %
Estimated gain from MediaAlpha transaction
as of December 31, 2018
—  55.07  
GAAP book value per share including the estimated gain
from the MediaAlpha transaction as of December 31, 2018
1,002.53  951.07  5.5 %
Adjustments to book value per share (see reconciliation
on page 6 of Exhibit 99.1 to this Form 8-K)
2.23  (8.15) 
Adjusted book value per share including the estimated
gain from the MediaAlpha transaction as of December 31, 2018
$1,004.76  $942.92  6.7 %
(1) Growth includes $1.00 per share dividend paid during the first quarter of 2019.
Gross written premiums and MSC from new business is a non-GAAP financial measure, which is derived by adjusting gross written premiums and MSC collected (i) to include the present value of future installment MSC not yet collected and (ii) to exclude the impact of gross written premium adjustments related to policies closed in prior periods. White Mountains believes these adjustments are useful to management and investors in evaluating the volume and pricing of new business closed during the period. The reconciliation from GAAP gross written premiums to gross written premiums and MSC from new business is included on page 14 of Exhibit 99.1 to this Form 8-K.


2


NSM’s EBITDA, adjusted EBITDA and pro forma adjusted EBITDA are non-GAAP financial measures. EBITDA is a non-GAAP financial measure that excludes interest expense on debt, income tax benefit (expense), depreciation and amortization from GAAP net income (loss). Adjusted EBITDA is a non-GAAP financial measure that excludes certain other items in GAAP net income (loss) in addition to those excluded from EBITDA. The adjustments relate to (i) change in fair value of contingent consideration earnout liabilities, (ii) acquisition-related transaction expenses, (iii) investments made in the development of new business lines and (iv) restructuring expenses. A description of each follows:
Change in fair value of contingent consideration earnout liabilities - Earnout liabilities are amounts payable to the sellers of businesses purchased by NSM that are contingent on the earnings of such businesses in periods subsequent to their acquisition. Under GAAP, earnout liabilities are not capitalized as part of the purchase price. Earnout liabilities are recorded at fair value, with the periodic change in the fair value of these liabilities recorded as income or an expense.
Acquisition-related transaction expenses - Represents costs directly related to transactions to acquire businesses, such as transaction-related compensation, banking, accounting and external lawyer fees, which are not capitalized and are expensed under GAAP.
Investments made in the development of new business lines - Represents the net loss related to the start-up of newly established lines of business, which NSM views as investments. For the periods presented, this adjustment relates primarily to NSM’s investment expenditures, net of revenues generated, in the organic development of (i) its pet insurance line and (ii) its MGA in the United Kingdom. NSM has recently decided to cease investment in the organic development of its pet insurance line and, instead, to acquire Embrace Pet Insurance, which closed in April 2019.
Restructuring expenses - Represents expenses associated with eliminating redundant work force and facilities that often arise as a result of NSM’s post-acquisition integration strategies.
Pro forma adjusted EBITDA is a non-GAAP financial measure that starts with adjusted EBITDA and also includes the earnings of acquired businesses for the period of time over the previous twelve months that the businesses were not owned by White Mountains. White Mountains believes that these non-GAAP financial measures are useful to management and investors in evaluating NSM’s performance. White Mountains also believes that pro forma adjusted EBITDA is useful to management and investors to demonstrate the current earnings profile of NSM’s business for a full twelve month period. See page 15 of Exhibit 99.1 to this Form 8-K for the reconciliation of NSM’s GAAP net income (loss) to EBITDA, adjusted EBITDA and pro forma adjusted EBITDA.
Total consolidated portfolio return excluding the MediaAlpha transaction is a non-GAAP financial measure that removes the $115 million pre-tax unrealized investment gain resulting from the MediaAlpha transaction recognized in the first quarter of 2019. White Mountains believes this measure to be useful to management and investors by making the return in the current period comparable to the prior periods. A reconciliation from GAAP to the reported percentage is as follows:
For the nine months ended September 30, 2019
GAAP returnRemove MediaAlphaReturn - excluding MediaAlpha
Total consolidated portfolio return15.9 %(4.6)%11.3 %


3


ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits



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 thereunto duly authorized.

WHITE MOUNTAINS INSURANCE GROUP, LTD.
November 6, 2019
By:
/s/   J. BRIAN PALMER    
       J. Brian Palmer
      Managing Director and
       Chief Accounting Officer

4
EX-99 2 wtmq32019earningsrelea.htm EX-99.1 Document
Exhibit 99.1
image11.jpg
CONTACT: Todd Pozefsky
(203) 458-5807

WHITE MOUNTAINS REPORTS THIRD QUARTER RESULTS

HAMILTON, Bermuda (November 6, 2019) - White Mountains Insurance Group, Ltd. (NYSE: WTM) reported book value per share of $1,003 and adjusted book value per share of $1,005 as of September 30, 2019. Book value per share and adjusted book value per share both increased 2% in the third quarter of 2019. Book value per share and adjusted book value per share increased 12% and 13% in the first nine months of 2019, including dividends. The results for the first nine months of 2019 include the impact of the MediaAlpha transaction. Excluding the gain on the MediaAlpha transaction, book value per share and adjusted book value per share would have increased 6% and 7% in the first nine months of 2019, including dividends.(1)

Manning Rountree, CEO, commented, “We had a good quarter on all fronts. Despite challenging primary market conditions, BAM produced strong premium volume, including a significant assumed reinsurance transaction. NSM again produced solid growth on both the top and bottom line. Kudu added three new investments in the quarter and has nearly deployed all of our initial $250 million commitment. Our investment portfolio was up 3.1%, a strong result that includes an increase in the fair value of our investment in MediaAlpha, which produced another quarter of record results. We ended the quarter with $1.1 billion of undeployed capital.

Comprehensive income attributable to common shareholders was $46 million and $348 million in the third quarter and first nine months of 2019, compared to comprehensive income (loss) attributable to common shareholders of $40 million and $(5) million in the third quarter and first nine months of 2018.

HG Global/BAM

BAM’s gross written premiums and member surplus contributions (MSC) collected were $44 million and $84 million in the third quarter and first nine months of 2019, compared to $16 million and $56 million in the third quarter and first nine months of 2018. BAM insured municipal bonds with par value of $4.1 billion and $8.9 billion in the third quarter and first nine months of 2019, compared to $2.2 billion and $6.6 billion in the third quarter and first nine months of 2018. In the third quarter of 2019, BAM completed an assumed reinsurance transaction to insure municipal bonds with a par value of $1.1 billion. Total pricing was 107 and 94 basis points in the third quarter and first nine months of 2019, compared to 75 and 91 basis points in the third quarter and first nine months of 2018. BAM’s total claims paying resources were $930 million at September 30, 2019, compared to $871 million at December 31, 2018 and $835 million at September 30, 2018.

Seán McCarthy, CEO of BAM, said, “BAM had a strong quarter. Overall new issue volume rose as issuers took advantage of lower interest rates to refinance outstanding bonds, and investor demand for insurance increased. However, lower interest rates and tighter credit spreads continued to impact pricing in the primary market. In the quarter, BAM insured $2.7 billion of municipal bonds in the primary market, up 31% year over year, and an additional $289 million in the secondary market, up almost 100% year over year. We also completed our second assumed reinsurance transaction, helping to bring total par in force to a new high of $59 billion.”




(1) See “Regulation G” on page 16.

1


HG Global reported pre-tax income of $14 million and $44 million in the third quarter and first nine months of 2019, compared to pre-tax income of $8 million and $21 million in the third quarter and first nine months of 2018. White Mountains reported pre-tax loss related to BAM of $10 million and $26 million in the third quarter and first nine months of 2019, compared to pre-tax loss of $17 million and $53 million in the third quarter and first nine months of 2018. The period over period changes were driven primarily by higher investment returns in the HG Global and BAM investment portfolios.

BAM is a mutual insurance company that is owned by its members.  BAM’s results are consolidated into White Mountains’s GAAP financial statements and attributed to non-controlling interests.

NSM

In the third quarter of 2019, NSM reported pre-tax income of $5 million, adjusted EBITDA of $13 million, and commission and other revenues of $60 million. In the first nine months of 2019, NSM reported pre-tax income of $4 million, adjusted EBITDA of $39 million, and commission and other revenues of $175 million. Results for the third quarter and first nine months of 2019 include Embrace Pet Insurance, a nationwide provider of pet health insurance for dogs and cats, which NSM acquired on April 1, 2019, and KBK Insurance Group, a specialized MGU focused on the towing and transportation space, which NSM acquired on December 3, 2018.

Geof McKernan, CEO of NSM, said,NSM had another solid quarter. Trailing 12 months pro forma controlled premiums grew to $883 million, and pro forma adjusted EBITDA reached $50 million for the first time ever. These results reflect strong growth in the specialty transportation and pet verticals. We continue to invest in technology and talent to drive organic growth while also pursuing attractive acquisition opportunities.”

Kudu

In the third quarter of 2019, Kudu deployed $77 million in three investment management firms. Kudu has now deployed a total of $222 million in eight investment management firms with combined assets under management of over $30 billion, spanning a range of asset classes, including real estate, real assets, wealth management, hedge funds and alternative credit strategies.

In the third quarter of 2019, Kudu reported total revenues of $8 million and pre-tax income of $3 million. For the period from April 4, 2019 through September 30, 2019, Kudu reported total revenues of $12 million and pre-tax income of $5 million.

Rob Jakacki, CEO of Kudu, said, “Kudu remained active during the third quarter, adding three new investments to our portfolio. We have now deployed $222 million of capital into eight transactions with an average cash yield at inception of 10.2%. The Kudu business as a whole was profitable for the second consecutive quarter with higher revenues driven by both the steady growth in assets under management from the existing portfolio and the impact of the new transactions in the third quarter. We continue to see strong opportunities in the private capital and wealth management segments.”
2


Other Operations

White Mountains’s Other Operations segment reported pre-tax income of $40 million and $328 million in the third quarter and first nine months of 2019, compared to pre-tax income (loss) of $53 million and $(9) million in the third quarter and first nine months of 2018. Pre-tax income in the first nine months of 2019 included $182 million of realized and unrealized gains from the MediaAlpha transaction. Excluding the MediaAlpha transaction, net realized and unrealized investment gains were $57 million and $200 million in the third quarter and first nine months of 2019, compared to net realized and unrealized investment gains of $70 million and $37 million in the third quarter and first nine months of 2018.

Investments

The total return on invested assets was 3.1% in both the third quarter of 2019 and 2018. The total return on invested assets was 15.9% in the first nine months of 2019, which included $115 million of unrealized investment gains from the MediaAlpha transaction. Excluding the MediaAlpha transaction, the total return on invested assets was 11.3% in the first nine months of 2019 compared to 2.8% in the first nine months of 2018.

Mark Plourde, Managing Director of White Mountains Advisors, said, “The total portfolio was up 3.1% in the third quarter. This result includes the impact of a $35 million increase in the fair value of our investment in MediaAlpha, driven by continued topline and bottom line growth since the MediaAlpha transaction in February. Common stocks returned 1.0%, behind the S&P 500 return of 1.7% due to relative underperformance in our international positions. Fixed income returned 1.3%, essentially in-line with the BBIA Index return of 1.4%.”

Additional Information

White Mountains is a Bermuda-domiciled financial services holding company traded on the New York Stock Exchange and the Bermuda Stock Exchange under the symbol WTM. Additional financial information and other items of interest are available at the company’s website located at www.whitemountains.com. White Mountains expects to file its Form 10-Q today with the Securities and Exchange Commission and urges shareholders to refer to that document for more complete information concerning its financial results.
3


WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(millions)
(Unaudited)
September 30,
2019
December 31,
2018
September 30,
2018
Assets 
   Financial Guarantee (HG Global/BAM)
     Fixed maturity investments$794.5  $701.4  $677.7  
     Short-term investments57.1  66.9  35.9  
Total investments851.6  768.3  713.6  
     Cash 11.3  12.5  17.9  
     Insurance premiums receivable6.7  6.4  6.3  
     Deferred acquisition costs21.4  19.0  17.6  
     Accrued investment income5.5  4.9  4.8  
     Accounts receivable on unsettled investment sales—  —  .2  
     Other assets 16.4  5.1  5.1  
Total Financial Guarantee assets912.9  816.2  765.5  
Specialty Insurance Distribution (NSM)
     Short-term investments—  1.7  .9  
     Cash (restricted $67.0, $50.0 and $41.2)105.7  66.2  60.6  
Premium and commission receivable53.6  44.0  29.1  
     Goodwill and other intangible assets630.6  486.2  431.0  
     Other assets36.8  28.9  18.8  
Total Specialty Insurance Distribution assets826.7  627.0  540.4  
Global Asset and Wealth Management (Kudu)
Other long-term investments219.3  —  —  
Short-term investments.1  —  —  
Cash4.9  —  —  
Accrued investment income4.7  —  —  
Goodwill and other intangible assets9.6  —  —  
Other assets3.7  —  —  
Total Global Asset and Wealth Management assets242.3  —  —  
   Marketing Technology (MediaAlpha)
     Cash—  5.7  13.0  
     Goodwill and other intangible assets—  43.4  45.9  
     Accounts receivable from publishers and advertisers—  37.0  35.9  
     Other assets—  2.3  2.2  
Total Marketing Technology assets—  88.4  97.0  
   Other Operations
     Fixed maturity investments371.5  376.1  354.2  
     Short-term investments215.3  145.6  276.9  
     Common equity securities629.7  925.6  1,043.5  
     Other long-term investments554.4  325.6  289.7  
Total investments1,770.9  1,772.9  1,964.3  
     Cash27.3  25.9  20.7  
     Accrued investment income5.1  5.5  5.7  
     Accounts receivable on unsettled investment sales.3  —  3.3  
     Goodwill and other intangible assets20.7  7.9  8.3  
     Other assets27.3  15.5  14.3  
     Assets held for sale2.8  3.3  3.3  
Total Other Operations assets1,854.4  1,831.0  2,019.9  
Total assets$3,836.3  $3,362.6  $3,422.8  
4


WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
(millions)
(Unaudited)
September 30,
2019
December 31,
2018
September 30,
2018
Liabilities
   Financial Guarantee (HG Global/BAM)
     Unearned insurance premiums$203.5  $176.0  $156.2  
     Accrued incentive compensation19.0  20.4  16.5  
     Accounts payable on unsettled investment purchases3.6  2.2  6.5  
     Other liabilities27.4  13.9  13.5  
Total Financial Guarantee liabilities253.5  212.5  192.7  
Specialty Insurance Distribution (NSM)
Debt219.4  178.5  149.3  
Premiums payable92.6  77.2  56.6  
Contingent consideration earnout liabilities28.7  20.2  20.1  
     Other liabilities60.1  38.9  27.7  
Total Specialty Insurance Distribution liabilities400.8  314.8  253.7  
Global Asset and Wealth Management (Kudu)
Other liabilities5.3  —  —  
Total Global Asset and Wealth Management liabilities5.3  —  —  
   Marketing Technology (MediaAlpha)
     Debt—  14.2  15.0  
     Amounts due to publishers and advertisers—  27.0  37.7  
     Other liabilities—  5.7  3.9  
Total Marketing Technology liabilities—  46.9  56.6  
   Other Operations
     Debt10.8  —  —  
     Accrued incentive compensation44.9  38.9  40.3  
     Accounts payable on unsettled investment purchases—  5.0  14.2  
     Other liabilities50.1  26.3  25.7  
Total Other Operations liabilities105.8  70.2  80.2  
Total liabilities765.4  644.4  583.2  
Equity
White Mountains's common shareholder's equity
     White Mountains’s common shares and paid-in surplus593.2  584.0  579.5  
     Retained earnings2,611.5  2,264.9  2,407.3  
Accumulated other comprehensive loss, after tax:
  Net unrealized foreign currency translation losses and interest rate swap(11.3) (5.8) (2.8) 
Total White Mountains’s common shareholders’ equity3,193.4  2,843.1  2,984.0  
Non-controlling interests(122.5) (124.9) (144.4) 
Total equity3,070.9  2,718.2  2,839.6  
Total liabilities and equity$3,836.3  $3,362.6  $3,422.8  

5


WHITE MOUNTAINS INSURANCE GROUP, LTD.
BOOK VALUE AND ADJUSTED BOOK VALUE PER SHARE
(Unaudited)
 September 30,
2019
June 30,
2019
December 31,
2018
September 30,
2018
Book value per share numerators (in millions):
White Mountains’s common shareholders’ equity -
GAAP book value per share numerator
$3,193.4  $3,144.3  $2,843.1  $2,984.0  
Time value of money discount on expected future payments on the BAM Surplus Notes (1)
(132.8) (135.7) (141.2) (146.3) 
HG Global’s unearned premium reserve (1)
160.4  147.2  136.9  120.2  
HG Global’s net deferred acquisition costs (1)
(42.0) (37.9) (34.6) (29.4) 
Adjusted book value per share numerator$3,179.0  $3,117.9  $2,804.2  $2,928.5  
Book value per share denominators (in thousands of shares):
Common shares outstanding - GAAP book value per share denominator3,185.4  3,185.4  3,173.1  3,180.5  
Unearned restricted common shares  (21.5) (24.5) (14.6) (18.5) 
Adjusted book value per share denominator3,163.9  3,160.9  3,158.5  3,162.0  
GAAP book value per share$1,002.53  $987.12  $896.00  $938.19  
Adjusted book value per share$1,004.76  $986.39  $887.85  $926.14  
(1) Amount reflects White Mountains's preferred share ownership in HG Global of 96.9%.
September 30,
2019
June 30,
2019
December 31,
2018
September 30,
2018
Quarter-to-date change in GAAP book value per share,
including dividends:
1.6 %0.6 %(4.5)%1.5 %
Quarter-to-date change in adjusted book value per share,
including dividends:
1.9 %0.8 %(4.1)%1.5 %
Year-to-date change in GAAP book value per share,
including dividends:
12.0 %10.3 %(3.7)%0.8 %
Year-to-date change in adjusted book value per share,
including dividends:
13.3 %11.2 %(2.8)%1.4 %
Year-to-date dividends per share$1.00  $1.00  $1.00  $1.00  
September 30,
2019
June 30,
2019
December 31,
2018
September 30,
2018
Summary of goodwill and other intangible assets (in millions):
Goodwill:
NSM $397.0  
(1)
$398.4  
(1)
$354.3  
(2)
$295.5  
Kudu7.6  9.8  
(3)
—  —  
MediaAlpha—  —  18.3  18.3  
Other Operations20.2  
(1)
20.4  
(1)
7.3  7.6  
Total goodwill424.8  428.6  379.9  321.4  
Other intangible assets:
NSM233.6  238.4  131.9  135.5  
Kudu2.0  —  —  —  
MediaAlpha—  —  25.1  27.6  
Other Operations.5  .6  .6  .7  
Total other intangible assets236.1  239.0  157.6  163.8  
Total goodwill and other intangible assets660.9  667.6  537.5  485.2  
Goodwill and other intangible assets attributed to
non-controlling interests
(25.0) (25.4) (40.6) (40.6) 
Goodwill and other intangible assets included in
White Mountains's common shareholders' equity
$635.9  $642.2  $496.9  $444.6  
(1) The relative fair values of goodwill and of other intangible assets recognized in connection with the acquisition of Embrace and Other Operations had not yet been finalized at September 30, 2019 and June 30, 2019.
(2) The relative fair values of goodwill and of other intangible assets recognized in connection with the acquisition of KBK had not yet been finalized at December 31, 2018.
(3) The relative fair values of goodwill and other intangible assets recognized in connection with the acquisition of Kudu had not yet been finalized as of June 30, 2019.


6


WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(millions)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
2019201820192018
Revenues:
   Financial Guarantee (HG Global/BAM)
     Earned insurance premiums$5.2  $3.3  $13.7  $9.7  
     Net investment income5.4  4.8  16.1  12.5  
     Net realized and unrealized investment gains (losses) 7.1  (4.1) 30.4  (14.4) 
     Other revenues.3  .2  1.3  .8  
Total Financial Guarantee revenues18.0  4.2  61.5  8.6  
Specialty Insurance Distribution (NSM)
Commission revenues49.4  35.0  147.6  56.4  
Other revenues10.5  4.7  27.7  6.8  
Total Specialty Insurance Distribution revenues59.9  39.7  175.3  63.2  
Global Asset and Wealth Management (Kudu)
Net investment income4.6  —  8.6  —  
Net realized and unrealized investment gains2.7  —  3.1  —  
Other revenues.2  —  .2  —  
Total Global Asset and Wealth Management revenues7.5  —  11.9  —  
   Marketing Technology (MediaAlpha)
     Advertising and commission revenues—  74.5  48.8  216.4  
     Other revenues—  —  —  1.6  
Total Marketing Technology revenues—  74.5  48.8  218.0  
   Other Operations
     Net investment income8.4  8.6  30.7  32.4  
     Net realized and unrealized investment gains57.2  70.2  199.6  37.3  
  Realized gain and unrealized investment gain from
the MediaAlpha transaction
—  —  182.2  —  
     Advertising and commission revenues1.9  1.1  4.5  3.0  
     Other revenues2.6  .4  3.6  .6  
Total Other Operations revenues70.1  80.3  420.6  73.3  
Total revenues$155.5  $198.7  $718.1  $363.1  


7


WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (CONTINUED)
(millions)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
2019201820192018
Expenses:
Financial Guarantee (HG Global/BAM)
Insurance acquisition expenses$1.4  $1.2  $4.1  $3.9  
     Other underwriting expenses
.1  .1  .3  .3  
General and administrative expenses12.5  11.3  39.1  36.5  
Total Financial Guarantee expenses14.0  12.6  43.5  40.7  
Specialty Insurance Distribution (NSM)
General and administrative expenses33.3  23.5  91.4  35.7  
Broker commission expenses15.3  10.6  48.9  17.1  
Change in fair value of contingent consideration earnout liabilities(2.0) 2.6  5.6  2.6  
Amortization of other intangible assets4.4  5.0  13.5  5.0  
Interest expense4.4  3.2  12.2  4.8  
Total Specialty Insurance Distribution expenses55.4  44.9  171.6  65.2  
Global Asset and Wealth Management (Kudu)
General and administrative expenses4.5  —  6.7  —  
Amortization of other intangible assets.2  —  .2  —  
Total Global Asset and Wealth Management expenses4.7  —  6.9  —  
Marketing Technology (MediaAlpha)
Cost of sales—  61.8  40.6  179.1  
General and administrative expenses—  5.4  12.5  21.2  
Amortization of other intangible assets—  2.4  1.6  7.8  
Interest expense—  .2  .2  .9  
Total Marketing Technology expenses—  69.8  54.9  209.0  
Other Operations
Cost of sales2.3  1.1  5.0  2.9  
General and administrative expenses27.7  26.0  87.2  79.0  
Amortization of other intangible assets—  —  .1  .1  
Interest expense.3  —  .3  .3  
Total Other Operations expenses30.3  27.1  92.6  82.3  
Total expenses104.4  154.4  369.5  397.2  
Pre-tax income (loss) from continuing operations51.1  44.3  348.6  (34.1) 
Income tax (expense) benefit(8.8) 3.6  (18.9) .4  
Net income (loss) from continuing operations42.3  47.9  329.7  (33.7) 
Net gain (loss) from sale of discontinued operations, net of tax.9  (17.3) 1.6  (17.2) 
Net income (loss)43.2  30.6  331.3  (50.9) 
Net loss attributable to non-controlling interests5.5  10.2  22.3  47.2  
Net income (loss) attributable to White Mountains’s
common shareholders
$48.7  $40.8  $353.6  $(3.7) 

8



WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(millions)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
2019201820192018
Net income (loss) attributable to White Mountains’s
common shareholders
$48.7  $40.8  $353.6  $(3.7) 
Other comprehensive loss, net of tax(2.4) (.8) (5.8) (1.7) 
Comprehensive income (loss) 46.3  40.0  347.8  (5.4) 
Other comprehensive income attributable to non-controlling interests.1  .2  .3  .2  
Comprehensive income (loss) attributable to White Mountains’s
common shareholders
$46.4  $40.2  $348.1  $(5.2) 




WHITE MOUNTAINS INSURANCE GROUP, LTD.
EARNINGS PER SHARE
(Unaudited)

Income (loss) per share attributable to White Mountains’s common shareholdersThree Months Ended September 30,Nine Months Ended September 30,
2019201820192018
Basic earnings (loss) per share
Continuing operations$15.01  $18.27  $110.67  $3.90  
Discontinued operations.28  (5.44) .50  (4.98) 
Total consolidated operations$15.29  $12.83  $111.17  $(1.08) 
Diluted earnings (loss) per share
Continuing operations$15.01  $18.27  $110.67  $3.90  
Discontinued operations.28  (5.44) .50  (4.98) 
Total consolidated operations$15.29  $12.83  $111.17  $(1.08) 
Dividends declared per White Mountains’s common share$—  $—  $1.00  $1.00  

9


WHITE MOUNTAINS INSURANCE GROUP, LTD.
QTD SEGMENT STATEMENTS OF PRE-TAX INCOME (LOSS)
(millions)
(Unaudited)


For the Three Months Ended September 30, 2019HG Global/BAM
HG GlobalBAMNSMKuduOther OperationsTotal
Revenues:
Earned insurance premiums$4.2  $1.0  $—  $—  $—  $5.2  
Net investment income1.8  3.6  —  4.6  8.4  18.4  
Net investment income (loss) - BAM surplus note interest6.9  (6.9) —  —  —  —  
Net realized and unrealized investment gains2.0  5.1  —  2.7  57.2  67.0  
Advertising and commission revenues—  —  49.4  —  1.9  51.3  
Other revenues—  .3  10.5  .2  2.6  13.6  
Total revenues14.9  3.1  59.9  7.5  70.1  155.5  
Expenses:
Insurance acquisition expenses1.1  .3  —  —  —  1.4  
Other underwriting expenses—  .1  —  —  —  .1  
Cost of sales—  —  —  —  2.3  2.3  
General and administrative expenses.3  12.2  33.3  4.5  27.7  78.0  
Broker commission expenses—  —  15.3  —  —  15.3  
Change in fair value of contingent consideration
earnout liabilities
—  —  (2.0) —  —  (2.0) 
Amortization of other intangible assets—  —  4.4  .2  —  4.6  
Interest expense—  —  4.4  —  .3  4.7  
Total expenses1.4  12.6  55.4  4.7  30.3  104.4  
Pre-tax income (loss)$13.5  $(9.5) $4.5  $2.8  $39.8  $51.1  


10


WHITE MOUNTAINS INSURANCE GROUP, LTD.
QTD SEGMENT STATEMENTS OF PRE-TAX INCOME (LOSS) (CONTINUED)
(millions)
(Unaudited)


For the Three Months Ended September 30, 2018HG Global/BAM
HG GlobalBAMNSMMediaAlphaOther OperationsTotal
Revenues:
Earned insurance premiums$2.6  $.7  $—  $—  $—  $3.3  
Net investment income1.6  3.2  —  —  8.6  13.4  
Net investment income (loss) - BAM surplus note interest5.7  (5.7) —  —  —  —  
Net realized and unrealized investment (losses) gains(.7) (3.4) —  —  70.2  66.1  
Advertising and commission revenues—  —  35.0  74.5  1.1  110.6  
Other revenues—  .2  4.7—  .4  5.3  
Total revenues9.2  (5.0) 39.7  74.5  80.3  198.7  
Expenses:
Insurance acquisition expenses.6  .6  —  —  —  1.2  
Other underwriting expenses—  .1  —  —  —  .1  
Cost of sales—  —  —  61.8  1.1  62.9  
General and administrative expenses.2  11.1  23.5  5.4  26.0  66.2  
Broker commission expenses—  —  10.6  —  —  10.6  
Change in fair value of contingent consideration
earnout liabilities
—  —  2.6  —  —  2.6  
Amortization of other intangible assets—  —  5.0  2.4  —  7.4  
Interest expense—  —  3.2  .2  —  3.4  
Total expenses.8  11.8  44.9  69.8  27.1  154.4  
Pre-tax income (loss)$8.4  $(16.8) $(5.2) $4.7  $53.2  $44.3  


11




WHITE MOUNTAINS INSURANCE GROUP, LTD.
YTD SEGMENT STATEMENTS OF PRE-TAX INCOME (LOSS)
(millions)
(Unaudited)


For the Nine Months Ended September 30, 2019HG Global/BAM
HG GlobalBAMNSM
Kudu (1)
MediaAlpha (2)
Other OperationsTotal
Revenues:
Earned insurance premiums$11.0  $2.7  $—  $—  $—  $—  $13.7  
Net investment income5.6  10.5  —  8.6  —  30.7  55.4  
Net investment income (loss) -
BAM surplus note interest
20.6  (20.6) —  —  —  —  —  
Net realized and unrealized
investment gains
11.1  19.3  —  3.1  —  199.6  233.1  
Realized and unrealized gains from
MediaAlpha transaction
—  —  —  —  —  182.2  182.2  
Advertising and commission revenues—  —  147.6  —  48.8  4.5  200.9  
Other revenue—  1.3  27.7  .2  —  3.6  32.8  
Total revenues48.3  13.2  175.3  11.9  48.8  420.6  718.1  
Expenses:
Insurance acquisition expenses2.8  1.3  —  —  —  —  4.1  
Other underwriting expenses—  .3  —  —  —  —  .3  
Cost of sales—  —  —  —  40.6  5.0  45.6  
General and administrative expenses1.2  37.9  91.4  6.7  5.7  87.2  230.1  
General and administrative expenses -
MediaAlpha transaction related costs
—  —  —  —  6.8  —  6.8  
Broker commission expenses—  —  48.9  —  —  —  48.9  
Change in fair value of contingent
consideration earnout liabilities
—  —  5.6  —  —  —  5.6  
Amortization of other intangible assets—  —  13.5  .2  1.6  .1  15.4  
Interest expense—  —  12.2  —  .2  .3  12.7  
Total expenses4.0  39.5  171.6  6.9  54.9  92.6  369.5  
Pre-tax income (loss)$44.3  $(26.3) $3.7  $5.0  $(6.1) $328.0  $348.6  
(1) Kudu's results are from April 4, 2019, the date of the Kudu transaction, to September 30, 2019.
(2) MediaAlpha's results are from January 1, 2019 to February 26, 2019, the date of the MediaAlpha transaction.
















12





WHITE MOUNTAINS INSURANCE GROUP, LTD.
YTD SEGMENT STATEMENTS OF PRE-TAX INCOME (LOSS) (CONTINUED)
(millions)
(Unaudited)


For the Nine Months Ended September 30, 2018HG Global/BAM
HG GlobalBAM
NSM (1)
MediaAlphaOther OperationsTotal
Revenues:
Earned insurance premiums$7.6  $2.1  $—  $—  $—  $9.7  
Net investment income4.1  8.4  —  —  32.4  44.9  
Net investment income (loss) -
BAM surplus note interest
17.2  (17.2) —  —  —  —  
Net realized and unrealized investment
(losses) gains
(5.5) (8.9) —  —  37.3  22.9  
Advertising and commission revenues—  —  56.4  216.4  3.0  275.8  
Other revenue—  .8  6.8  1.6  .6  9.8  
Total revenues23.4  (14.8) 63.2  218.0  73.3  363.1  
Expenses:
Insurance acquisition expenses1.8  2.1  —  —  —  3.9  
Other underwriting expenses—  .3  —  —  —  .3  
Cost of sales—  —  —  179.1  2.9  182.0  
General and administrative expenses.8  35.7  35.7  21.2  79.0  172.4  
Broker commission expense—  —  17.1  —  —  17.1  
Change in fair value of contingent
consideration earnout liabilities
—  —  2.6  —  —  2.6  
Amortization of other intangible assets—  —  5.0  7.8  .1  12.9  
Interest expense—  —  4.8  .9  .3  6.0  
Total expenses2.6  38.1  65.2  209.0  82.3  397.2  
Pre-tax income (loss)$20.8  $(52.9) $(2.0) $9.0  $(9.0) $(34.1) 
(1) NSM's results are from May 11, 2018, the date of the acquisition of NSM, to September 30, 2018.
13


WHITE MOUNTAINS INSURANCE GROUP, LTD.
SELECTED FINANCIAL DATA
(millions)
(Unaudited)

Three Months Ended September 30,Nine Months Ended September 30,
BAM2019201820192018
Gross par value of primary market policies issued$2,662.7  $2,029.4  $6,672.7  $5,953.6  
Gross par value of assumed reinsurance1,130.7  —  1,130.7  —  
Gross par value of secondary market policies issued288.6  144.9  1,121.0  605.0  
Total gross par value of market policies issued$4,082.0  $2,174.3  $8,924.4  $6,558.6  
Gross written premiums$20.8  $3.9  $41.2  $28.9  
Member surplus contributions (MSC) collected
23.0  12.1  42.9  26.9  
Total gross written premiums and MSC collected$43.8  $16.0  $84.1  $55.8  
Present value of future installment MSC collections.1  .2  .3  3.0  
Gross written premium adjustments on existing
installment policies
—  —  (.1) 1.1  
Gross written premiums and MSC from
new business
$43.9  $16.2  $84.3  $59.9  
Total pricing107 bps  75 bps  94 bps  91 bps  

As of
September 30, 2019 
 As of
December 31, 2018 
 
Policyholders’ surplus$422.1  $413.7  
Contingency reserve64.3  50.3  
Qualified statutory capital486.4  464.0  
Statutory net unearned premiums40.5  36.2  
Present value of future installment premiums and MSC13.7  12.9  
HG Re, Ltd collateral trusts at statutory value289.2  258.3  
Fidus Re, Ltd collateral trust at statutory value100.0  100.0  
     Claims paying resources$929.8  $871.4  
Three Months Ended September 30,Nine Months Ended September 30,
HG Global2019201820192018
Net written premiums$17.8  $3.4  $35.2  $24.5  
Earned premiums$4.2  $2.6  $11.0  $7.6  

As of
September 30, 2019 
 As of
December 31, 2018 
 
Unearned premiums$165.5  $141.3  
Deferred acquisition costs$43.4  $35.7  

14


WHITE MOUNTAINS INSURANCE GROUP, LTD.
SELECTED FINANCIAL DATA (CONTINUED)
(millions)
(Unaudited)

NSMThree Months Ended
September 30, 2018
Three Months Ended
September 30, 2019
Nine Months Ended
September 30, 2019
Twelve Months Ended
October 1, 2018 to
September 30, 2019
Commission revenues$35.0  $49.4  $147.6  $181.0  
Broker commission expenses10.6  15.3  48.9  60.1  
Gross profit24.4  34.1  98.7  120.9  
Other revenues4.7  10.5  27.7  32.7  
General and administrative expenses23.5  33.3  91.4  115.2  
Change in fair value of contingent consideration
earnout liabilities
2.6  (2.0) 5.6  5.7  
Amortization of other intangible assets5.0  4.4  13.5  16.8  
Interest expense3.2  4.4  12.2  15.4  
GAAP pre-tax (loss) income(5.2) 4.5  3.7  .5  
Income tax (benefit) expense(1.6) 1.7  1.7  2.2  
GAAP net (loss) income(3.6) 2.8  2.0  (1.7) 
Add back:
Interest expense3.2  4.4  12.2  15.4  
Income tax (benefit) expense(1.6) 1.7  1.7  2.2  
General and administrative expenses – depreciation.6  .8  2.0  2.7  
Amortization of other intangible assets5.0  4.4  13.5  16.8  
EBITDA3.6  14.1  31.4  35.4  
Add back:
Change in fair value of contingent consideration
earnout liabilities
2.6  (2.0) 5.6  5.7  
Acquisition-related transaction expenses.1  .3  1.4  1.8  
Investments made in the development of
new business lines
.8  .1  .3  1.2  
Restructuring expenses—  .3  .4  .4  
Adjusted EBITDA$7.1  $12.8  $39.1  $44.5  
Add:
KBK's adjusted EBITDA from October 1, 2018 to December 3, 20181.2  
Embrace's adjusted EBITDA from October 1, 2018 to April 1, 20194.5  
Pro forma adjusted EBITDA for the twelve months ended September 30, 2019$50.2  





15


Regulation G

This earnings release includes seven non-GAAP financial measures that have been reconciled to their most comparable GAAP financial measures.
Adjusted book value per share is a non-GAAP financial measure which is derived by adjusting (i) the GAAP book value per share numerator and (ii) the common shares outstanding denominator, as described below.

The GAAP book value per share numerator is adjusted (i) to include a discount for the time value of money arising from the expected timing of cash payments of principal and interest on the BAM surplus notes and (ii) to add back the unearned premium reserve, net of deferred acquisition costs, at HG Global. Under GAAP, White Mountains is required to carry the BAM surplus notes, including accrued interest, at nominal value with no consideration for time value of money. Based on a debt service model that forecasts operating results for BAM through maturity of the surplus notes, the present value of the BAM surplus notes, including accrued interest, was estimated to be $137 million, $140 million, $146 million and $151 million less than the nominal GAAP carrying values as of September 30, 2019, June 30, 2019, December 31, 2018, and September 30, 2018, respectively. The value of HG Global’s unearned premium reserve, net of deferred acquisition costs, was $122 million, $113 million, $106 million and $94 million as of September 30, 2019, June 30, 2019, December 31, 2018, and September 30, 2018, respectively. White Mountains believes these adjustments are useful to management and investors in analyzing the intrinsic value of HG Global, including the value of the surplus notes and the value of the in-force business at HG Re, HG Global’s reinsurance subsidiary.

The denominator used in the calculation of adjusted book value per share equals the number of common shares outstanding adjusted to exclude unearned restricted common shares, the compensation cost of which, at the date of calculation, has yet to be amortized. Restricted common shares are earned on a straight-line basis over their vesting periods. The reconciliation of GAAP book value per share to adjusted book value per share is included on page 6.

• The growth in adjusted book value per share included on page 1 reflects the estimated gain from the MediaAlpha transaction as if it had closed on December 31, 2018. A reconciliation from GAAP to the reported percentage is as follows:
As of
September 30, 2019
As of
December 31, 2018
Growth % (1)
GAAP book value per share$1,002.53  $896.00  12.0 %
Estimated gain from MediaAlpha transaction
as of December 31, 2018
—  55.07  
GAAP book value per share including the estimated gain
from the MediaAlpha transaction as of December 31, 2018
1,002.53  951.07  5.5 %
Adjustments to book value per share (see reconciliation
on page 6)
2.23  (8.15) 
Adjusted book value per share including the estimated
gain from the MediaAlpha transaction as of December 31, 2018
$1,004.76  $942.92  6.7 %
(1) Growth includes $1.00 per share dividend paid during the first quarter of 2019.

Gross written premiums and MSC from new business is a non-GAAP financial measure, which is derived by adjusting gross written premiums and MSC collected (i) to include the present value of future installment MSC not yet collected and (ii) to exclude the impact of gross written premium adjustments related to policies closed in prior periods. White Mountains believes these adjustments are useful to management and investors in evaluating the volume and pricing of new business closed during the period. The reconciliation from GAAP gross written premiums to gross written premiums and MSC from new business is included on page 14.
16


NSM’s EBITDA, adjusted EBITDA and pro forma adjusted EBITDA are non-GAAP financial measures.

EBITDA is a non-GAAP financial measure that excludes interest expense on debt, income tax benefit (expense), depreciation and amortization from GAAP net income (loss).

Adjusted EBITDA is a non-GAAP financial measure that excludes certain other items in GAAP net income (loss) in addition to those excluded from EBITDA. The adjustments relate to (i) change in fair value of contingent consideration earnout liabilities, (ii) acquisition-related transaction expenses, (iii) investments made in the development of new business lines and (iv) restructuring expenses. A description of each follows:
Change in fair value of contingent consideration earnout liabilities - Earnout liabilities are amounts payable to the sellers of businesses purchased by NSM that are contingent on the earnings of such businesses in periods subsequent to their acquisition. Under GAAP, earnout liabilities are not capitalized as part of the purchase price. Earnout liabilities are recorded at fair value, with the periodic change in the fair value of these liabilities recorded as income or an expense.
Acquisition-related transaction expenses - Represents costs directly related to transactions to acquire businesses, such as transaction-related compensation, banking, accounting and external lawyer fees, which are not capitalized and are expensed under GAAP.
Investments made in the development of new business lines - Represents the net loss related to the start-up of newly established lines of business, which NSM views as investments. For the periods presented, this adjustment relates primarily to NSM’s investment expenditures, net of revenues generated, in the organic development of (i) its pet insurance line and (ii) its MGA in the United Kingdom. NSM has recently decided to cease investment in the organic development of its pet insurance line and, instead, to acquire Embrace Pet Insurance, which closed in April 2019.
Restructuring expenses - Represents expenses associated with eliminating redundant work force and facilities that often arise as a result of NSM’s post-acquisition integration strategies.
Pro forma adjusted EBITDA is a non-GAAP financial measure that starts with adjusted EBITDA and also includes the earnings of acquired businesses for the period of time over the previous twelve months that the businesses were not owned by White Mountains.

White Mountains believes that these non-GAAP financial measures are useful to management and investors in evaluating NSM’s performance. White Mountains also believes that pro forma adjusted EBITDA is useful to management and investors to demonstrate the current earnings profile of NSM’s business for a full twelve month period. See page 15 for the reconciliation of NSM’s GAAP net income (loss) to EBITDA, adjusted EBITDA and pro forma adjusted EBITDA.

Total consolidated portfolio return excluding the MediaAlpha transaction is a non-GAAP financial measure that removes the $115 million pre-tax unrealized investment gain resulting from the MediaAlpha transaction recognized in the first quarter of 2019. White Mountains believes this measure to be useful to management and investors by making the return in the current period comparable to the prior periods. A reconciliation from GAAP to the reported percentage is as follows:

For the nine months ended September 30, 2019
GAAP returnRemove MediaAlpha transactionReturn - excluding MediaAlpha transaction
Total consolidated portfolio return15.9 %(4.6)%11.3 %
17


Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

This earnings release may contain “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 or referenced in this release which address activities, events or developments which White Mountains expects or anticipates will or may occur in the future are forward-looking statements. The words “will”, “believe”, “intend”, “expect”, “anticipate”, “project”, “estimate”, “predict” and similar expressions are also intended to identify forward-looking statements. These forward-looking statements include, among others, statements with respect to White Mountains’s:

change in adjusted book value per share or return on equity;
business strategy;
financial and operating targets or plans;
incurred loss and loss adjustment expenses and the adequacy of its loss and loss adjustment expense reserves;
projections of revenues, income (or loss), earnings (or loss) per share, dividends, market share or other financial forecasts;
expansion and growth of its business and operations; and
future capital expenditures.

These statements are based on certain assumptions and analyses made by White Mountains in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors believed to be appropriate in the circumstances. However, whether actual results and developments will conform to its expectations and predictions is subject to risks and uncertainties that could cause actual results to differ materially from expectations, including:

the risks that are described from time to time in White Mountains’s filings with the Securities and Exchange Commission, including but not limited to White Mountains’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 and White Mountains’s June 30, 2019 Quarterly Report on Form 10-Q;
business opportunities (or lack thereof) that may be presented to it and pursued;
actions taken by ratings agencies from time to time, such as financial strength or credit ratings downgrades or placing ratings on negative watch;
the continued availability of capital and financing;
general economic, market or business conditions;
competitive forces, including the conduct of other insurers;
changes in domestic or foreign laws or regulations, or their interpretation, applicable to White Mountains, its competitors or its customers;
an economic downturn or other economic conditions adversely affecting its financial position; and
other factors, most of which are beyond White Mountains’s control.

Consequently, all of the forward-looking statements made in this earnings release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by White Mountains will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, White Mountains or its business or operations. White Mountains assumes no obligation to publicly update any such forward-looking statements, whether as a result of new information, future events or otherwise.

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Document and Entity Information
Nov. 06, 2019
Cover page.  
Document Type 8-K
Document Period End Date Nov. 06, 2019
Entity Registrant Name WHITE MOUNTAINS INSURANCE GROUP, LTD.
Entity Incorporation, State or Country Code D0
Entity File Number 1-8993
Entity Tax Identification Number 94-2708455
Entity Address, Address Line One 80 South Main Street
Entity Address, City or Town Hanover
Entity Address, State or Province NH
Entity Address, Postal Zip Code 03755
City Area Code 603
Local Phone Number 640-2200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Shares, par value $1.00
Trading Symbol WTM
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0000776867
Amendment Flag false
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