Part I — Financial Information This section presents the company's unaudited consolidated financial statements, management's discussion and analysis, market risk disclosures, and internal controls [Financial Statements](index=2&type=section&id=Item%201%20%E2%80%94%20Financial%20Statements) The unaudited consolidated financial statements for American Financial Group, Inc. (AFG) show an increase in total assets to $30.8 billion as of September 30, 2023, from $28.8 billion at year-end 2022. For the nine months ended September 30, 2023, net earnings were $589 million, a decrease from $622 million in the prior-year period. The company generated $1.21 billion in net cash from operating activities during the first nine months of 2023, an increase from $1.04 billion in the same period of 2022 [Consolidated Balance Sheet](index=2&type=section&id=Consolidated%20Balance%20Sheet) This section presents the company's financial position, including assets, liabilities, and equity at specific dates Consolidated Balance Sheet Highlights (in Millions) | Account | Sep 30, 2023 | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Total cash and investments | $14,794 | $14,512 | | Total assets | $30,825 | $28,831 | | **Liabilities & Equity** | | | | Unpaid losses and loss adjustment expenses | $12,891 | $11,974 | | Long-term debt | $1,474 | $1,496 | | Total liabilities | $26,844 | $24,779 | | Total shareholders' equity | $3,981 | $4,052 | | Total liabilities and shareholders' equity | $30,825 | $28,831 | [Consolidated Statement of Earnings](index=3&type=section&id=Consolidated%20Statement%20of%20Earnings) This section details the company's revenues, expenses, and net earnings over specific periods Consolidated Earnings Summary (in Millions, Except Per Share Data) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | P&C insurance net earned premiums | $1,855 | $1,767 | $4,799 | $4,462 | | Net investment income | $168 | $151 | $583 | $549 | | Total revenues | $2,164 | $1,984 | $5,744 | $5,111 | | Net Earnings | $177 | $165 | $589 | $622 | | Total diluted earnings per share | $2.09 | $1.93 | $6.93 | $7.29 | [Consolidated Statement of Comprehensive Income](index=4&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Income) This section reports changes in equity from non-owner sources, including net earnings and other comprehensive income items - Comprehensive income was **$118 million** for Q3 2023, a significant improvement from a comprehensive loss of **$89 million** in Q3 2022. For the nine-month period, comprehensive income was **$562 million** in 2023, compared to a loss of **$99 million** in 2022. The change was primarily driven by smaller other comprehensive losses from unrealized holding losses on securities[11](index=11&type=chunk) [Consolidated Statement of Changes in Equity](index=5&type=section&id=Consolidated%20Statement%20of%20Changes%20in%20Equity) This section details changes in shareholders' equity, including net earnings, dividends, and share repurchases - For the nine months ended September 30, 2023, total shareholders' equity decreased from **$4,052 million** to **$3,981 million**. The decrease was driven by dividends paid (**$500 million**) and common stock repurchases (**$153 million**), which were partially offset by net earnings of **$589 million**[14](index=14&type=chunk) Share Repurchases and Dividends (9 Months Ended Sep 30, 2023, in Millions) | Activity | Amount | | :--- | :--- | | Dividends Paid | $500 | | Shares Acquired and Retired | $153 | [Consolidated Statement of Cash Flows](index=7&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) This section summarizes cash inflows and outflows from operating, investing, and financing activities Consolidated Cash Flow Summary (9 Months Ended Sep 30, in Millions) | Cash Flow Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,214 | $1,043 | | Net cash provided by (used in) investing activities | $459 | $(1,062) | | Net cash used in financing activities | $(1,324) | $(1,318) | | **Net Change in Cash and Cash Equivalents** | **$349** | **$(1,337)** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the financial statements - On July 3, 2023, AFG acquired Crop Risk Services (CRS) from AIG for **$234 million** in cash. The preliminary purchase price allocation includes **$85 million** in goodwill and **$124 million** in finite-lived intangible assets, primarily related to agency relationships[60](index=60&type=chunk)[63](index=63&type=chunk) - During Q3 2023, AFG recorded a goodwill impairment charge of **$26 million** related to its investment in Verikai due to slower than anticipated growth. This charge is included in 'realized loss on subsidiary'[127](index=127&type=chunk) - The company's property and casualty insurance operations are divided into three main sub-segments: Property and transportation, Specialty casualty, and Specialty financial[66](index=66&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=37&type=section&id=Item%202%20%E2%80%94%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reported net earnings of $177 million ($2.09 per share) for Q3 2023, up from $165 million ($1.93 per share) in Q3 2022, driven by higher investment yields and lower realized losses, partially offset by lower underwriting profit in the Specialty casualty segment. For the first nine months of 2023, net earnings were $589 million, down from $622 million year-over-year, primarily due to lower underwriting profit and reduced returns from alternative investments. The company maintains a strong financial position, with a debt-to-total capital ratio of 24.8% and expects continued premium growth in a favorable P&C market [Overview](index=38&type=section&id=Overview) This section provides a high-level summary of the company's financial performance and outlook Net Earnings Comparison (in Millions, Except Per Share) | Period | 2023 | 2022 | | :--- | :--- | :--- | | **Q3 Net Earnings** | **$177** | **$165** | | **Q3 Diluted EPS** | **$2.09** | **$1.93** | | **9 Months Net Earnings** | **$589** | **$622** | | **9 Months Diluted EPS** | **$6.93** | **$7.29** | - Management expects continued premium growth and strong underwriting results due to the favorable property and casualty insurance market. Higher interest rates are anticipated to positively impact investment income into 2024[164](index=164&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) This section discusses the company's ability to meet its short-term and long-term obligations and its capital structure Debt to Total Capital Ratio | Date | Ratio (Including Subordinated Debt) | | :--- | :--- | | Sep 30, 2023 | 24.8% | | Dec 31, 2022 | 24.9% | - In the first nine months of 2023, AFG repurchased **1,329,831 shares** for **$153 million** and paid a special cash dividend of **$341 million** (**$4.00 per share**). A further special dividend of **$1.50 per share** (approx. **$126 million**) was declared on November 1, 2023[175](index=175&type=chunk) - At September 30, 2023, the parent company (AFG) held **$364 million** in cash and investments and had access to a new five-year, **$450 million** revolving credit facility established in June 2023, with no borrowings outstanding[179](index=179&type=chunk) [Results of Operations](index=48&type=section&id=Results%20of%20Operations) This section analyzes the company's revenues, expenses, and profitability across its business segments Reconciliation to Core Net Operating Earnings (Non-GAAP, in Millions) | Metric | Q3 2023 | Q3 2022 | 9 Months 2023 | 9 Months 2022 | | :--- | :--- | :--- | :--- | :--- | | **Net Earnings (GAAP)** | **$177** | **$165** | **$589** | **$622** | | Realized (gains) losses, net of tax | $15 | $28 | $53 | $113 | | Realized loss on subsidiary | $4 | - | $4 | - | | Special A&E charge, net of tax | $12 | - | $12 | - | | Gain (loss) on retirement of debt, net of tax | - | $(1) | $(1) | $7 | | **Core Net Operating Earnings** | **$208** | **$192** | **$657** | **$738** | [Quantitative and Qualitative Disclosure about Market Risk](index=73&type=section&id=Item%203%20%E2%80%94%20Quantitative%20and%20Qualitative%20Disclosure%20about%20Market%20Risk) The company's market risk profile has not materially changed since its 2022 Form 10-K. The primary market risk is interest rate risk affecting the fair value of its fixed maturity portfolio. A hypothetical immediate 100 basis point increase in interest rates would result in an estimated pretax decrease of $299 million (3.0%) in the fair value of the fixed maturity portfolio as of September 30, 2023 Interest Rate Sensitivity of Fixed Maturity Portfolio (as of Sep 30, 2023) | Metric | Value | | :--- | :--- | | Fair value of fixed maturity portfolio | $9,982 million | | Pretax impact of 100 bps rate increase | $(299) million | | Percentage impact | (3.0%) | [Controls and Procedures](index=73&type=section&id=Item%204%20%E2%80%94%20Controls%20and%20Procedures) Management, including the Co-CEOs and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of the end of the third quarter of 2023. There were no material changes to the company's internal control over financial reporting during the quarter - Based on an evaluation as of the end of the reporting period, the Co-CEOs and CFO concluded that the company's disclosure controls and procedures are effective[374](index=374&type=chunk) Part II — Other Information This section includes details on equity security sales, other disclosures, and required exhibits [Unregistered Sales of Equity Securities and Use of Proceeds](index=74&type=section&id=Item%202%20%E2%80%94%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the third quarter of 2023, AFG repurchased a total of 755,111 shares of its common stock at an average price of approximately $112.25 per share. For the first nine months of 2023, the company repurchased a total of 1,329,831 shares for $153 million. As of the end of the quarter, approximately 6.3 million shares remained authorized for repurchase under existing plans Issuer Purchases of Equity Securities (Q3 2023) | Month | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | July | 9,707 | $115.34 | | August | 258,104 | $112.57 | | September | 487,300 | $112.07 | | **Q3 Total** | **755,111** | **~$112.25** | - As of September 30, 2023, **6,271,723 shares** may yet be purchased under the company's publicly announced repurchase plans, which are authorized through December 31, 2025[376](index=376&type=chunk) [Other Information](index=74&type=section&id=Item%205%20%E2%80%94%20Other%20Information) During the third quarter of 2023, no directors or officers of the company adopted, terminated, or modified any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - No directors or officers adopted, terminated, or modified a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement" during the three months ended September 30, 2023[378](index=378&type=chunk) [Exhibits](index=75&type=section&id=Item%206%20%E2%80%94%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications from the Co-Chief Executive Officers and Chief Financial Officer as required by the Sarbanes-Oxley Act of 2002, and XBRL data files

American Financial Group, Inc. (NYSE:AFG) Q3 2023 Earnings Conference Call November 2, 2023 6:00 AM ET Company Participants Diane Weidner - VP, IR Carl Lindner - Co-CEO Craig Lindner - Co-CEO Brian Hertzman - CFO Conference Call Participants Michael Zaremski - BMO Andrew Andersen - Jefferies Gregory Peters - Raymond James Operator Good day, and thank you for standing by. Welcome to the American Financial Group Third Quarter 2023 Results Conference Call. [Operator Instructions] Please be advised that today's ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended June 30, 2023 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ____ Commission File No. 1-13653 AMERICAN FINANCIAL GROUP, INC. Incorporated under the Laws of Ohio IRS Employer I.D. No. 31-1544320 301 East Fourth Street, Cinci ...

American Financial Group, Inc. (NYSE:AFG) Q2 2023 Results Conference Call August 3, 2023 11:30 AM ET Company Participants Diane Weidner - VP, IR Carl Lindner - Co-CEO Craig Lindner - Co-CEO Brian Hertzman - CFO Conference Call Participants Paul Newsome - Piper Sandler Meyer Shields - Keefe, Bruyette, & Woods Michael Zaremski - BMO Operator Good day, and thank you for standing by. Welcome to the American Financial Group 2023 Second Quarter Results Conference Call. [Operator Instructions] Please be advised th ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarterly Period Ended March 31, 2023 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ____ Commission File No. 1-13653 AMERICAN FINANCIAL GROUP, INC. Incorporated under the Laws of Ohio IRS Employer I.D. No. 31-1544320 301 East Fourth Street, Cinc ...

American Financial Group, Inc. (NYSE:AFG) Q1 2023 Earnings Conference Call May 3, 2023 11:30 AM ET Company Participants Diane Weidner - Vice President of Investor Relations Carl Lindner - Co-Chief Executive Officer Craig Lindner - Co-Chief Executive Officer Brian Hertzman - Chief Financial Officer Conference Call Participants Paul Newsome - Piper Sandler Michael Zaremski - BMO Gregory Peters - Raymond James Jing Li - KBW Operator Good day, and thank you for standing by. Welcome to the American Financial Gro ...

Review of First Quarter 2023 May 3, 2023 Forward Looking Statements Certain statements made during this call, as well as included in this document, are not historical facts and may be considered "forwardlooking statements" and are based on estimates, assumptions and projections which management believes are reasonable, but by their nature subject to risks and uncertainties. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. The reasons which could cau ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☑ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Fiscal Year Ended December 31, 2022 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ____ Commission File No. 1-13653 | --- | --- | --- | |------------------------------------------------------------------|---------------------|----------------------- ...

Financial Data and Key Metrics Changes - AFG's core net operating earnings were $11.63 per share for the full year 2022, with a core operating return on equity of 21.2%, up from 18.6% in 2021 [9][10] - The fourth quarter 2022 core net operating earnings per share were $2.99, resulting in an annualized core return on equity of 22.3% [11] - The company returned $1.23 billion to shareholders in 2022, including over $1 billion in special dividends [10][17] Business Line Data and Key Metrics Changes - Specialty Property & Casualty businesses achieved record full year underwriting profit and pretax core operating earnings [21] - The combined ratio for the fourth quarter was 86.6%, up from 80.7% in the prior year, but excluding crop business, the ratio was comparable to the previous year [22][23] - Gross and net written premiums increased by 6% and 5%, respectively, in the fourth quarter of 2022 compared to the prior year [23] Market Data and Key Metrics Changes - The average renewal pricing across the Property and Casualty Group, excluding workers' comp, was up approximately 6% for the quarter [24] - The company expects net written premiums for 2023 to be 3% to 5% higher than the $6.2 billion reported in 2022 [36] Company Strategy and Development Direction - AFG aims to maintain adequate pricing and has achieved overall rate increases across its specialty book for 26 consecutive quarters [25] - The company is focused on capital management and returning capital to shareholders, reflecting confidence in its financial future [9][10] Management's Comments on Operating Environment and Future Outlook - Management noted increased competition in certain specialty businesses, particularly in California workers' comp and excess liability [40] - The company expects a favorable property and casualty market in 2023, with core net operating earnings projected to be in the range of $11 to $12 per share [34] Other Important Information - AFG's investment portfolio totaled $14.5 billion, with pretax unrealized losses on fixed maturity portfolio at $630 million due to rising interest rates [11][12] - The company declared a special dividend of $4 per share payable on February 28, 2023, in addition to the regular quarterly dividend [17] Q&A Session Summary Question: Competitive environment for specialty businesses - Management acknowledged increased competition in certain areas, particularly in California workers' comp and excess liability, while noting that most other businesses remain stable [40][41] Question: Talent pool and growth - Management indicated that talent acquisition has not been a limiting factor for growth, attributing success to a strong company culture and reputation [43][44] Question: Renewal rates outlook - Management noted that the deceleration in average renewal rates is influenced by workers' comp and competitive pressures in certain lines of business [45][46] Question: Changes in loss trends - Management stated that prospective loss ratio trends have remained stable, with no significant changes noted in the transportation segment [50][51] Question: Investment portfolio outlook - Management provided insights on the expected return of 7% on alternative investments, reflecting a more normalized environment compared to previous years [52][55] Question: Adverse reserve development in specialty segment - Management explained that adverse development was primarily due to social inflation in excess liability lines, with a conservative approach to reserving [57][58] Question: Macroeconomic growth underpinning premium growth expectations - Management indicated that premium growth expectations are based on various economic factors rather than a specific GDP number, reflecting a slowing economy [60][61]

Financial Data and Key Metrics Changes - AFG reported core net operating earnings of $2.24 per share, down from $2.71 per share in Q3 2021, primarily due to lower returns in the alternative investment portfolio [9][10] - Net earnings included after-tax non-core net realized losses on securities of $28 million, or $0.32 per share, with $21 million or $0.24 per share from mark-to-market losses on equity securities [9][10] - The annualized core operating return was over 17% for the quarter, despite elevated industry catastrophe losses [6][7] Business Line Data and Key Metrics Changes - Property & Casualty net investment income decreased by 12% year-over-year, while excluding alternative investments, net investment income increased by 35% due to rising interest rates [12][13] - Specialty P&C insurance operations generated an underwriting profit of $158 million, a 7% decrease from $169 million in Q3 2021, with a combined ratio of 91.1%, up from 89 in the prior year [18][19] - The Specialty Casualty Group reported an underwriting profit of $118 million, up from $110 million in the prior year, with a combined ratio of 82.6% [26][27] Market Data and Key Metrics Changes - Gross and net written premiums increased by 19% and 15% respectively in Q3 2022 compared to the prior year, driven by new business opportunities and favorable renewal rates [20][21] - Average renewal pricing across the P&C group, excluding workers' compensation, was up about 6% for the quarter [21][32] - The Specialty Financial Group reported a 91.3% combined ratio for Q3 2022, an increase of 7.1 points over the prior year [29] Company Strategy and Development Direction - The company continues to focus on returning capital to shareholders, announcing a special cash dividend of $2 per share, in addition to the regular quarterly dividend [7][8] - AFG's investment strategy remains disciplined yet opportunistic, with a focus on high-quality medium-duration fixed maturity securities [11][14] - The company expects continued favorable conditions in the property and casualty market, with opportunities for growth from rate increases and exposure growth [32][33] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to achieve continued price increases in 2023, despite competitive pressures in certain areas [40][41] - The company anticipates that the macro environment, including social inflation and rising reinsurance costs, will create opportunities for pricing adjustments [40][42] - AFG's guidance for core net operating earnings in 2022 has been narrowed to a range of $11 to $11.75 per share, reflecting strong performance in the first nine months [33] Other Important Information - AFG's book value per share plus dividends declined by approximately 2% in Q3 2022, reflecting unrealized losses on fixed maturities due to rising interest rates [17] - The company has declared $12 per share in special dividends in 2022, maintaining a strong excess capital position [17][8] Q&A Session Summary Question: Thoughts on pricing trends in P&C for next year - Management noted that higher levels of catastrophes and increased reinsurance pricing are expected to create opportunities for price increases in 2023 [40][41] Question: Concerns about inflation's impact on Specialty Casualty business - Management is adjusting pricing based on higher prospective loss ratio trends and remains confident in the profitability of their excess and umbrella liability businesses [44][45] Question: Outlook for the workers' compensation business - Management indicated that while the overall results are strong, the California subsidiary is projected to have an accident year underwriting loss, but overall profitability is expected to remain stable [51][52] Question: Impact of crop on underwriting ratios - Management clarified that crop does not significantly impact the pricing index for the Property and Transportation segment due to its unique nature [60][61] Question: Debt repurchase penalties - Management confirmed that they could buy back debt at a discount in the open market, with most debt having a make-whole call provision [62][63] Question: Investment portfolio and interest rate trajectory - Management believes inflation has peaked and is comfortable investing in intermediate-term high-grade paper while extending the duration of the portfolio [66]