Core Viewpoint - The analysis compares Essent Group (ESNT) and Berkshire Hathaway B (BRK.B) to determine which stock presents a better value opportunity for investors in the Property and Casualty insurance sector [1] Group 1: Zacks Rank and Earnings Outlook - Essent Group has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Berkshire Hathaway B has a Zacks Rank of 3 (Hold) [3] - The Zacks Rank system emphasizes companies with positive earnings estimate revisions, suggesting that ESNT is likely experiencing a more favorable earnings outlook [3][7] Group 2: Valuation Metrics - Essent Group has a forward P/E ratio of 8.87, significantly lower than Berkshire Hathaway B's forward P/E of 24.26 [5] - The PEG ratio for Essent Group is 2.73, compared to Berkshire Hathaway B's PEG ratio of 3.47, indicating that ESNT may offer better value relative to its expected earnings growth [5] - Essent Group's P/B ratio is 1.13, while Berkshire Hathaway B's P/B ratio is 1.59, further supporting the argument for ESNT being undervalued [6] - These valuation metrics contribute to Essent Group's Value grade of B, in contrast to Berkshire Hathaway B's Value grade of D [6]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Essent Group Ltd.'s H1 2025 unaudited financials report **$7.22 billion** in assets, **$370.8 million** net income, and strong operating cash flow despite share repurchases [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) Total assets increased to **$7.22 billion**, liabilities rose to **$1.55 billion**, and stockholders' equity slightly increased to **$5.67 billion** as of June 30, 2025 | (In thousands) | June 30, 2025 (USD) | December 31, 2024 (USD) | | :--- | :--- | :--- | | **Total Assets** | **$7,220,561** | **$7,111,649** | | Total Investments | $6,326,360 | $6,180,621 | | Cash | $92,116 | $131,480 | | **Total Liabilities** | **$1,547,713** | **$1,507,991** | | Reserve for losses and LAE | $364,749 | $328,866 | | Net deferred tax liability | $427,202 | $392,428 | | **Total Stockholders' Equity** | **$5,672,848** | **$5,603,658** | [Condensed Consolidated Statements of Comprehensive Income](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) Q2 2025 net income decreased to **$195.3 million**, and H1 2025 net income was **$370.8 million**, primarily due to a higher provision for losses | (In thousands, except per share) | Three Months Ended June 30, 2025 (USD) | Three Months Ended June 30, 2024 (USD) | Six Months Ended June 30, 2025 (USD) | Six Months Ended June 30, 2024 (USD) | | :--- | :--- | :--- | :--- | :--- | | **Total revenues** | $319,143 | $312,942 | $636,701 | $611,299 | | **Provision (benefit) for losses and LAE** | $17,055 | $(334) | $48,342 | $9,579 | | **Net income** | **$195,339** | **$203,609** | **$370,772** | **$385,328** | | **Diluted EPS** | **$1.93** | **$1.91** | **$3.62** | **$3.61** | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity%20(Unaudited)) Stockholders' equity increased to **$5.67 billion** in H1 2025, driven by **$370.8 million** net income, partially offset by dividends and share repurchases - Key drivers for the change in stockholders' equity in the first six months of 2025 include: - Net income: **+$370.8 million**[21](index=21&type=chunk) - Dividends declared: **-$63.2 million**[21](index=21&type=chunk) - Cancellation of treasury stock (share repurchases): **-$340.2 million**[21](index=21&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)) Operating cash flow was **$411.1 million** in H1 2025, but significant financing activities, including **$339.4 million** in share repurchases, led to a **$39.4 million** net cash decrease | (In thousands) | Six Months Ended June 30, 2025 (USD) | Six Months Ended June 30, 2024 (USD) | | :--- | :--- | :--- | | Net cash provided by operating activities | $411,104 | $405,626 | | Net cash used in investing activities | $(48,576) | $(255,272) | | Net cash used in financing activities | $(401,892) | $(94,739) | | **Net (decrease) increase in cash** | **$(39,364)** | **$55,615** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) The notes detail the single mortgage insurance segment, **$6.3 billion** investment portfolio, extensive reinsurance, and **$328.5 million** in H1 2025 share repurchases - The company operates in **one reportable business segment: Mortgage Insurance**, which offers private mortgage insurance and reinsurance for U.S. residential properties[34](index=34&type=chunk)[125](index=125&type=chunk) | Investment Type | Fair Value (June 30, 2025, USD thousands) | % of Total | | :--- | :--- | :--- | | Corporate debt securities | $1,908,167 | 32.0% | | U.S. agency mortgage-backed securities | $1,172,715 | 19.7% | | Asset-backed securities | $796,065 | 13.4% | | Municipal debt securities | $600,618 | 10.0% | | Money market funds | $580,964 | 9.7% | | Other | $909,726 | 15.2% | | **Total Investments Available for Sale** | **$5,966,537** | **100.0%** | - The company utilizes both **Quota Share (QSR)** and **Excess of Loss (XOL)** reinsurance agreements to manage risk[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - As of June 30, 2025, total risk in force (RIF) ceded under QSR agreements was **$9.5 billion**[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - The XOL coverage is provided through both traditional reinsurance panels and insurance-linked notes (Radnor Re Transactions)[54](index=54&type=chunk)[55](index=55&type=chunk)[56](index=56&type=chunk) - In H1 2025, the company repurchased **5,755,400 common shares** at a cost of **$328.5 million** under its authorized share repurchase plan[82](index=82&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses stable mortgage insurance performance with **$12.5 billion** NIW, strong capital (9.2:1 risk-to-capital), and increased provision for losses due to aging defaults [Overview & Current Developments](index=34&type=section&id=Overview%20%26%20Current%20Developments) Essent's core mortgage insurance business saw stable **$12.5 billion** NIW for Q2 2025, with elevated interest rates impacting investment income and persistency - New insurance written (NIW) was approximately **$12.5 billion** for Q2 2025, consistent with the **$12.5 billion** from Q2 2024[140](index=140&type=chunk) - Elevated mortgage interest rates have **reduced home buying and refinance activity**, leading to **lower NIW and title insurance volumes**, but have **increased net investment income and the persistency** of the mortgage insurance in force[144](index=144&type=chunk) [Key Performance Indicators](index=40&type=section&id=Key%20Performance%20Indicators) Insurance in Force grew to **$246.8 billion**, with a stable net premium rate of **0.36%** and a strong risk-to-capital ratio of **9.2:1** | (In thousands) | End of Q2 2025 (USD) | End of Q2 2024 (USD) | | :--- | :--- | :--- | | Insurance in Force (IIF) | $246,797,619 | $240,669,165 | | Risk in Force (RIF) | $56,811,096 | $55,521,538 | - The average net premium rate for the U.S. mortgage insurance portfolio was stable at **0.36%** for both the three and six months ended June 30, 2025 and 2024[187](index=187&type=chunk) - The risk-to-capital ratio for Essent Guaranty was **9.2:1** as of June 30, 2025, indicating a **strong capital position** relative to its net risk in force of **$34.0 billion** and statutory capital of **$3.7 billion**[188](index=188&type=chunk) [Results of Operations](index=42&type=section&id=Results%20of%20Operations) Consolidated net income decreased in Q2 2025 to **$195.3 million** due to a higher provision for losses, partially offset by increased net investment income | (In thousands, except per share) | Q2 2025 (USD) | Q2 2024 (USD) | H1 2025 (USD) | H1 2024 (USD) | | :--- | :--- | :--- | :--- | :--- | | Net Premiums Earned | $248,809 | $251,891 | $494,657 | $497,481 | | Net Investment Income | $59,289 | $56,086 | $117,499 | $108,171 | | Provision (benefit) for losses | $17,055 | $(334) | $48,342 | $9,579 | | **Net Income** | **$195,339** | **$203,609** | **$370,772** | **$385,328** | - The provision for losses **increased significantly** in Q2 and H1 2025 compared to the same periods in 2024, primarily due to the **aging of defaults** remaining within the mortgage insurance portfolio, which **increased the average reserve per default**[196](index=196&type=chunk)[208](index=208&type=chunk) - The Mortgage Insurance segment's combined ratio **increased to 22.1%** in Q2 2025 **from 16.2%** in Q2 2024, driven by a **higher loss ratio**[200](index=200&type=chunk) [Liquidity and Capital Resources](index=50&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$1.0 billion** in cash and investments at the holding company and Essent Guaranty's PMIERs Available Assets at **176%** of minimum required - As of June 30, 2025, the holding companies had **$1.0 billion in cash and investments**, and there was **$500 million of available capacity** under the Revolving Credit Facility[226](index=226&type=chunk) - Essent Guaranty's risk-to-capital ratio was **9.2:1** as of June 30, 2025, with statutory capital of **$3.7 billion**[247](index=247&type=chunk) - The company was **in compliance with Private Mortgage Insurer Eligibility Requirements (PMIERs)**, with Essent Guaranty's Available Assets at **$3.7 billion**, or **176%** of its Minimum Required Assets of **$2.1 billion**[251](index=251&type=chunk) [Financial Condition](index=55&type=section&id=Financial%20Condition) Stockholders' equity increased to **$5.7 billion**, and the **$6.3 billion** investment portfolio is primarily high-quality, investment-grade securities - Stockholders' equity **increased to $5.7 billion** at June 30, 2025, **from $5.6 billion** at December 31, 2024, driven by net income, partially offset by dividends and share repurchases[254](index=254&type=chunk) | Asset Class | Fair Value (June 30, 2025, USD thousands) | Percent | | :--- | :--- | :--- | | Corporate debt securities | $1,908,167 | 32.0% | | U.S. agency mortgage-backed securities | $1,172,715 | 19.7% | | Asset-backed securities | $796,065 | 13.4% | | **Total Investments Available for Sale** | **$5,966,537** | **100.0%** | [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, with an investment portfolio effective duration of **4.0 years** as of June 30, 2025 - The primary market risk is **interest rate risk** affecting the investment portfolio's value[265](index=265&type=chunk) - The effective duration of the investments available for sale was **4.0 years** at June 30, 2025, indicating that a **100 basis point change** in interest rates would change the portfolio's fair value by **approximately 4.0%**[267](index=267&type=chunk) [Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting - Management concluded that disclosure controls and procedures were **effective** as of June 30, 2025[268](index=268&type=chunk) - **No material changes** to internal control over financial reporting occurred during the quarter[269](index=269&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=58&type=section&id=Item%201.%20Legal%20Proceedings) The company is **not currently subject to any material legal proceedings** - The company is **not currently subject to any material legal proceedings**[272](index=272&type=chunk) [Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) There have been **no material changes in risk factors** from those disclosed in the Annual Report on Form 10-K for 2024 - There have been **no material changes in risk factors** from those disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[273](index=273&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q2 2025, the company repurchased **2,970,779** common shares for **$171.3 million**, with **$318.8 million** remaining for future repurchases | Period | Total Shares Purchased | Average Price Paid (USD) | Total Cost (approx., USD) | | :--- | :--- | :--- | :--- | | Q2 2025 | 2,970,779 | $57.66 | $171.3 million | - As of June 30, 2025, **$318.8 million** remained available for share repurchases under the company's authorized plan[275](index=275&type=chunk) [Exhibits](index=58&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and financial statements in Inline XBRL format - The exhibits filed with this report include CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1) and financial data in Inline XBRL format (Exhibit 101)[276](index=276&type=chunk)

Core Insights - Essent Group reported Q2 2025 GAAP EPS of $1.93, exceeding analyst expectations of $1.72, with GAAP revenue at $319.1 million, reflecting a 2.0% increase year-over-year [1][2] - The company experienced a 4.1% decline in net income to $195.3 million compared to Q2 2024, while new insurance written remained flat at $12.5 billion [1][2] Financial Performance - GAAP diluted EPS increased by 1.0% from $1.91 in Q2 2024 [2] - Revenue rose to $319.1 million from $312.9 million in Q2 2024 [2] - Net premiums earned decreased by 1.2% to $248.8 million [2] - New insurance written was unchanged at $12.5 billion [2] - Book value per share increased by 12.6% to $56.98 [5] Investment and Capital Management - Net investment income grew by 5.7% to $59.3 million, supported by a $6.3 billion investment portfolio [5] - The company repurchased 6.8 million shares for $387 million through July 2025, with $260 million remaining under the repurchase program [10] Risk Management and Credit Quality - The loss provision rose to $17.1 million, leading to a loss ratio of 6.6%, up from a negative 0.5% in Q2 2024 [7] - Loans in default increased to 17,255 from 13,954 a year ago [7] - The weighted average FICO credit score across the portfolio was 746, with new business scoring higher at 753 [6] Business Overview and Strategy - Essent Group provides private mortgage insurance, crucial for lenders and homebuyers with low down payments [3] - Key priorities include maintaining relationships with mortgage lenders, adhering to GSE rules, and managing credit risk [4] - The company emphasizes credit quality, capital efficiency, and shareholder returns [4] Title Insurance Segment - In the title insurance segment, Essent Group earned $14.9 million in GAAP net premiums, highlighting the cyclical nature of this business [9] Regulatory and Credit Ratings - Moody's upgraded Essent Guaranty's financial strength rating to A2 and the senior unsecured debt rating to Baa2, with stable outlooks [9] Dividend and Shareholder Returns - The quarterly dividend was maintained at $0.31 per share [10]

Financial Data and Key Metrics Changes - For Q2 2025, the company reported net income of $195 million, a decrease from $204 million a year ago [5] - Diluted earnings per share were $1.93, slightly up from $1.91 a year ago [6] - The return on average equity was 14% for the quarter [6] - Consolidated cash and investments totaled $6.4 billion with an annualized investment yield of 3.9% [10] Business Line Data and Key Metrics Changes - The U.S. Mortgage insurance in force was $247 billion, a 3% increase year-over-year [6] - The weighted average FICO score of the insurance in force was 746, with a weighted average original LTV of 93% [7] - The mortgage insurance net premium earned was $234 million, including $13.6 million from Essent Re [15] - Operating expenses for mortgage insurance were $36.3 million, with an expense ratio of 15.5% [17] Market Data and Key Metrics Changes - The twelve-month persistency rate was 86%, unchanged from the previous quarter [7] - The default rate on the U.S. Mortgage insurance portfolio was 2.12%, down from 2.19% [16] - The risk in force for Essent Re was $2.3 billion for GSE and other risk share [8] Company Strategy and Development Direction - The company aims to maintain a conservative balance sheet while pursuing strategic growth opportunities [11] - The focus remains on supporting affordable homeownership and navigating the current economic environment [21] - The company is actively returning capital to shareholders, with a common dividend of $0.31 approved for 2025 [12] Management's Comments on Operating Environment and Future Outlook - Management expressed a constructive outlook on housing demand driven by demographics [4] - The company believes that the current level of mortgage rates will support elevated persistency in the near term [7] - There is a focus on affordability challenges and the need for access to homeownership [8] Other Important Information - Moody's upgraded Essent Guaranty's insurance financial strength rating to A2 [11] - The company repurchased nearly 7 million shares for approximately $390 million year-to-date through July 31 [12] Q&A Session Summary Question: Expectations on home prices and pricing strategy - Management indicated that home price trends depend on local market conditions, with some areas expected to see price increases while others may weaken [23][24] Question: Insights on new defaults and credit outlook - New defaults were up 9% year-over-year, but management noted this aligns with normal seasoning patterns [31][32] Question: Buyback strategy and excess capital - The buyback pace is characterized as both opportunistic and valuation-sensitive, with a focus on shareholder returns [36][37] Question: Persistency trends by vintage - Management acknowledged that persistency varies by vintage, with natural aging contributing to trends observed [60][63] Question: Impact of AI and fintech on the business - Management does not see significant risk from borrowers canceling MI due to appraisals, viewing it as a minor concern [92][93]

EARNINGS PRESENTATION 2Q25 ESSENT GROUP LTD. NYSE: ESNT August 8, 2025 ESSENT GROUP LTD. | NYSE: ESNT © 2025 Essent Group Ltd. All rights reserved. | essentgroup.com | 1 Disclaimer This presentation may include "forward-looking statements" which are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," "should," "expect," "plan," "anticipate," "beli ...

[Earnings Release Overview](index=1&type=section&id=Earnings%20Release%20Overview) This section provides an overview of Essent Group Ltd.'s Q2 2025 financial performance, key operational highlights, and corporate information [Q2 2025 Financial Results and Dividend](index=1&type=section&id=Q2%202025%20Financial%20Results%20and%20Dividend) Essent Group Ltd. reported net income of $195.3 million or $1.93 per diluted share for Q2 2025, a decrease from $203.6 million or $1.91 per diluted share in Q2 2024. The Board of Directors declared a quarterly cash dividend of $0.31 per common share | Metric | Q2 2025 | Q2 2024 | | :------------------- | :------ | :------ | | Net Income | $195.3M | $203.6M | | Diluted EPS | $1.93 | $1.91 | | Quarterly Dividend | $0.31 | N/A | - CEO Mark A. Casale highlighted continued strength in credit, elevated portfolio persistency, and increased investment income as drivers for Q2 2025 financial results, emphasizing consistent execution and a resilient operating model[3](index=3&type=chunk) [Key Financial and Operational Highlights](index=1&type=section&id=Key%20Financial%20and%20Operational%20Highlights) The company reported strong new insurance written (NIW) and insurance in force (IIF) figures, an increase in net investment income, and a credit rating upgrade from Moody's. Essent also executed reinsurance agreements and continued its share repurchase program | Metric | Q2 2025 | Q1 2025 | Q2 2024 | YoY Change (Q2 2025 vs Q2 2024) | | :-------------------------- | :------ | :------ | :------ | :------------------------------ | | New Insurance Written (NIW) | $12.5B | $9.9B | $12.5B | 0% | | Insurance in Force (IIF) | $246.8B | $244.7B | $240.7B | +2.5% | | Net Investment Income (H1) | $117.5M | N/A | $108.17M| +9% | - Moody's Ratings upgraded Essent Guaranty, Inc.'s insurance financial strength rating to **A2 from A3** and Essent Group Ltd.'s senior unsecured debt rating to **Baa2 from Baa3**, with a stable outlook[10](index=10&type=chunk) - Essent entered into two excess of loss reinsurance agreements covering **20% of eligible policies written in 2025 and 2026**, and increased the ceding percentage on its affiliate quota share with Essent Reinsurance Ltd. from **35% to 50%** retroactive to January 1, 2025[10](index=10&type=chunk) - Year-to-date through July 31st, Essent repurchased **6.8 million common shares** for **$387 million**, with **$260 million** remaining under the **$500 million** repurchase plan[10](index=10&type=chunk) [Conference Call Information](index=1&type=section&id=Conference%20Call%20Information) Essent management hosted a conference call on August 8, 2025, to discuss Q2 2025 results. Details for live broadcast, dial-in access, and replays were provided - A live webcast of the conference call was available at http://ir.essentgroup.com/events-and-presentations/events/default.aspx, with replays available for one year[5](index=5&type=chunk)[6](index=6&type=chunk) [Forward-Looking Statements](index=1&type=section&id=Forward-Looking%20Statements) The press release includes forward-looking statements subject to known and unknown risks and uncertainties, which may cause actual results to differ materially from expectations. Key risks include changes to GSEs, competition, economic conditions, and loss reserve estimates - Forward-looking statements are identified by terms like 'may,' 'will,' 'expect,' and 'anticipate,' and are subject to risks such as changes in Fannie Mae and Freddie Mac, competition, and deteriorating economic conditions[8](index=8&type=chunk) [About the Company](index=1&type=section&id=About%20the%20Company) Essent Group Ltd. is a Bermuda-based holding company providing private mortgage insurance, reinsurance, and title insurance and settlement services to the housing finance industry - Essent Group Ltd. (NYSE: ESNT) offers private mortgage insurance, reinsurance, and title insurance and settlement services[9](index=9&type=chunk) [Financial Results and Supplemental Information (Unaudited)](index=3&type=section&id=Financial%20Results%20and%20Supplemental%20Information%20(Unaudited)) This section presents Essent Group Ltd.'s unaudited consolidated financial statements, including income statements, balance sheets, and detailed portfolio data for the second quarter of 2025 [Condensed Consolidated Statements of Comprehensive Income (Unaudited)](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)) For the three months ended June 30, 2025, Essent Group Ltd. reported total revenues of $319.1 million, a slight increase from $312.9 million in Q2 2024. Net income decreased to $195.3 million from $203.6 million year-over-year, primarily due to a higher provision for losses and LAE | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net Premiums Earned | $248,809 | $251,891 | $494,657 | $497,481 | | Net Investment Income | $59,289 | $56,086 | $117,499 | $108,171 | | Total Revenues | $319,143 | $312,942 | $636,701 | $611,299 | | Provision for Losses and LAE | $17,055 | $(334) | $48,342 | $9,579 | | Total Losses and Expenses | $87,968 | $73,717 | $198,527 | $158,332 | | Net Income | $195,339 | $203,609 | $370,772 | $385,328 | | Diluted EPS | $1.93 | $1.91 | $3.62 | $3.61 | - Net investment income increased by **5.7% YoY** for the quarter and **8.6%** for the six months ended June 30, 2025, reflecting improved investment performance[15](index=15&type=chunk) - The provision for losses and LAE significantly increased from a benefit of **$(334) thousand** in Q2 2024 to a provision of **$17,055 thousand** in Q2 2025, impacting net income[15](index=15&type=chunk) [Condensed Consolidated Balance Sheets (Unaudited)](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20(Unaudited)) As of June 30, 2025, total assets increased to $7.22 billion from $7.11 billion at December 31, 2024, driven by growth in total investments. Total stockholders' equity also saw an increase to $5.67 billion, while the return on average equity slightly decreased to 13.2% | Metric (in thousands) | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Total Investments | $6,326,360 | $6,180,621 | | Total Assets | $7,220,561 | $7,111,649 | | Reserve for Losses and LAE | $364,749 | $328,866 | | Total Liabilities | $1,547,713 | $1,507,991 | | Total Stockholders' Equity | $5,672,848 | $5,603,658 | | Return on Average Equity | 13.2% | 13.6% | - Accumulated other comprehensive loss improved from **$(303.9) million** at December 31, 2024, to **$(215.6) million** at June 30, 2025, indicating a positive change in unrealized investment appreciation[17](index=17&type=chunk) [Consolidated Historical Quarterly Data](index=6&type=section&id=Consolidated%20Historical%20Quarterly%20Data) This section provides a detailed quarterly breakdown of consolidated financial performance, showing trends in revenues, expenses, net income, and key per-share metrics. Net income for Q2 2025 was $195.3 million, a decrease from $203.6 million in Q2 2024, while book value per share increased to $56.98 | Metric (in thousands, except per share) | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | | :-------------------------------------- | :------ | :------ | :------ | :------ | :------ | | Net Premiums Earned | $248,809| $245,848| $244,465| $248,936| $251,891| | Net Investment Income | $59,289 | $58,210 | $56,559 | $57,340 | $56,086 | | Total Revenues | $319,143| $317,558| $315,027| $316,578| $312,942| | Provision for Losses and LAE | $17,055 | $31,287 | $40,975 | $30,666 | $(334) | | Net Income | $195,339| $175,433| $167,900| $176,175| $203,609| | Diluted EPS | $1.93 | $1.69 | $1.58 | $1.65 | $1.91 | | Book Value Per Share | $56.98 | $55.22 | $53.36 | $53.11 | $50.58 | | Return on Average Equity (annualized) | 13.8% | 12.5% | 11.9% | 12.8% | 15.4% | - Book value per share has shown consistent growth, increasing from **$50.58** in Q2 2024 to **$56.98** in Q2 2025[19](index=19&type=chunk) - The provision for losses and LAE has fluctuated significantly, moving from a benefit in Q2 2024 to a substantial provision in Q4 2024, Q1 2025, and Q2 2025[19](index=19&type=chunk) [U.S. Mortgage Insurance Portfolio Historical Quarterly Data](index=7&type=section&id=U.S.%20Mortgage%20Insurance%20Portfolio%20Historical%20Quarterly%20Data) The U.S. Mortgage Insurance Portfolio shows consistent growth in insurance in force, reaching $246.8 billion by June 30, 2025. New insurance written remained strong at $12.5 billion for Q2 2025, matching Q2 2024 levels. The percentage of loans in default increased to 2.12% from 1.71% YoY | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | New Insurance Written | $12,544,731 | $9,945,336 | $12,220,968 | $12,513,695 | $12,503,125 | | Insurance in Force (EOP) | $246,797,619 | $244,692,492 | $243,645,423 | $242,976,043 | $240,669,165 | | Loans in Default (count) | 17,255 | 17,759 | 18,439 | 15,906 | 13,954 | | Percentage of Loans in Default | 2.12% | 2.19% | 2.27% | 1.95% | 1.71% | | Annual Persistency | 85.8% | 85.7% | 85.7% | 86.6% | 86.7% | - The net average premium rate remained stable at **0.36%** in Q2 2025, consistent with Q2 2024[22](index=22&type=chunk) [New Insurance Written - U.S. Mortgage Insurance Portfolio](index=8&type=section&id=New%20Insurance%20Written%20-%20U.S.%20Mortgage%20Insurance%20Portfolio) New insurance written (NIW) for Q2 2025 totaled $12.5 billion, with a significant portion (50%) attributed to borrowers with credit scores of 760 or higher, an increase from 43.6% in Q2 2024. The majority of NIW (92.6%) was for purchase mortgages, and monthly premium policies dominated at 98.7% | NIW by Credit Score | Q2 2025 (%) | Q2 2024 (%) | | :------------------ | :---------- | :---------- | | >=760 | 50.0% | 43.6% | | <=679 | 4.9% | 4.8% | | Weighted Avg. Score | 753 | 748 | | NIW by LTV | Q2 2025 (%) | Q2 2024 (%) | | :------------------ | :---------- | :---------- | | 90.01% to 95.00% | 50.9% | 55.0% | | 95.01% and above | 16.5% | 18.8% | | Weighted Avg. LTV | 93% | 93% | | NIW by Type | Q2 2025 (%) | Q2 2024 (%) | | :------------------ | :---------- | :---------- | | Monthly Premium | 98.7% | 98.7% | | Purchase | 92.6% | 97.8% | | Refinance | 7.4% | 2.2% | [Insurance in Force and Risk in Force - U.S. Mortgage Insurance Portfolio](index=9&type=section&id=Insurance%20in%20Force%20and%20Risk%20in%20Force%20-%20U.S.%20Mortgage%20Insurance%20Portfolio) As of June 30, 2025, total insurance in force (IIF) reached $246.8 billion, with 41.1% of the portfolio having a FICO score of 760 or higher. The weighted average credit score remained stable at 746, and the weighted average LTV was 93% | Portfolio by Credit Score (IIF) | June 30, 2025 (%) | June 30, 2024 (%) | | :------------------------------ | :---------------- | :---------------- | | >=760 | 41.1% | 40.6% | | <=679 | 4.7% | 4.7% | | Weighted Avg. Credit Score | 746 | 746 | | Portfolio by LTV (IIF) | June 30, 2025 (%) | June 30, 2024 (%) | | :------------------------------ | :---------------- | :---------------- | | 90.01% to 95.00% | 52.7% | 51.3% | | 95.01% and above | 17.4% | 16.0% | | Weighted Avg. LTV | 93% | 93% | - The majority of the IIF (**97.8%**) consists of Fixed Rate Mortgages (FRM) with 30 years and higher amortization periods[27](index=27&type=chunk) [Other Risk in Force](index=10&type=section&id=Other%20Risk%20in%20Force) Essent's GSE and other risk share portfolio reported $2.32 billion in risk in force as of June 30, 2025, with a weighted average credit score of 751 and LTV of 83% | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :-------------------- | :------------ | :------------- | :---------------- | :----------------- | :------------ | | Risk in Force | $2,321,008 | $2,220,477 | $2,240,284 | $2,254,726 | $2,304,885 | | Reserve for Losses and LAE | $88 | $52 | $51 | $37 | $33 | | Weighted Avg. Credit Score | 751 | 751 | 751 | 750 | 750 | | Weighted Avg. LTV | 83% | 82% | 82% | 82% | 82% | - Essent Reinsurance Ltd. provides insurance or reinsurance for loans in reference pools acquired by Freddie Mac and Fannie Mae[29](index=29&type=chunk) [U.S. Mortgage Insurance Portfolio Vintage Data](index=11&type=section&id=U.S.%20Mortgage%20Insurance%20Portfolio%20Vintage%20Data) The vintage data for the U.S. Mortgage Insurance Portfolio as of June 30, 2025, shows that newer vintages (2022-2025) have a higher percentage of remaining insurance in force and generally higher incurred loss ratios compared to older vintages, reflecting the seasoning of the portfolio and recent economic conditions | Year | Original Insurance Written ($ thousands) | Remaining Insurance in Force ($ thousands) | % Remaining | Incurred Loss Ratio (Inception to Date) | Number of Loans in Default | Percentage of Loans in Default | | :--- | :--------------------------------------- | :----------------------------------------- | :---------- | :-------------------------------------- | :------------------------- | :----------------------------- | | 2010-2015 | $86,862,507 | $1,602,905 | 1.8% | 2.3% | 367 | 4.15% | | 2021 | $84,218,250 | $45,343,252 | 53.8% | 6.3% | 3,489 | 2.25% | | 2022 | $63,061,262 | $48,421,149 | 76.8% | 18.3% | 3,486 | 2.46% | | 2023 | $47,666,852 | $38,646,995 | 81.1% | 19.7% | 2,518 | 2.27% | | 2024 | $45,561,332 | $41,260,566 | 90.6% | 16.8% | 1,179 | 1.06% | | 2025 (through June 30) | $22,490,067 | $21,981,050 | 97.7% | 5.6% | 52 | 0.09% | - The total portfolio has a weighted average coupon of **5.08%** and a **92.3%** purchase mortgage composition[31](index=31&type=chunk) [U.S. Mortgage Insurance Portfolio Reinsurance Vintage Data](index=12&type=section&id=U.S.%20Mortgage%20Insurance%20Portfolio%20Reinsurance%20Vintage%20Data) Essent utilizes various reinsurance structures, including Insurance Linked Notes (ILNs), Excess of Loss, and Quota Share agreements, to manage risk and reduce PMIERs Minimum Required Assets. As of June 30, 2025, these agreements collectively reduced PMIERs Minimum Required Assets by over $1.7 million | Reinsurance Type | Remaining Insurance in Force ($ thousands) | Remaining Risk in Force ($ thousands) | Reduction in PMIERs Minimum Required Assets ($ thousands) | | :----------------- | :--------------------------------------- | :------------------------------------ | :-------------------------------------------------------- | | ILNs | $127,822,754 | $35,400,791 | $875,568 | | Excess of Loss | $141,472,015 | $38,833,403 | $229,027 | | Quota Share | $181,450,323 | $49,766,596 | $675,994 | - The most recent Quota Share agreement (Jan. 2025 - Dec. 2025) has a ceding percentage of **25%** and contributes **$97.1 million** to PMIERs Minimum Required Assets reduction[35](index=35&type=chunk) [U.S. Mortgage Insurance Portfolio Geographic Data](index=13&type=section&id=U.S.%20Mortgage%20Insurance%20Portfolio%20Geographic%20Data) California, Florida, and Texas continue to represent the largest concentrations of Essent's insurance in force (IIF) and gross risk in force (RIF) as of June 30, 2025, collectively accounting for over 35% of the portfolio | State | IIF by State (June 30, 2025) | Gross RIF by State (June 30, 2025) | | :---- | :--------------------------- | :--------------------------------- | | CA | 12.3% | 12.3% | | FL | 12.0% | 12.2% | | TX | 11.3% | 11.5% | | CO | 4.0% | 4.0% | | AZ | 3.9% | 4.0% | | GA | 3.8% | 3.9% | - The geographic distribution of both IIF and Gross RIF has remained relatively stable compared to March 31, 2025, and June 30, 2024[39](index=39&type=chunk) [Rollforward of Defaults and Reserve for Losses and LAE - U.S. Mortgage Insurance Portfolio](index=14&type=section&id=Rollforward%20of%20Defaults%20and%20Reserve%20for%20Losses%20and%20LAE%20-%20U.S.%20Mortgage%20Insurance%20Portfolio) The number of insured loans in default decreased slightly to 17,255 at June 30, 2025, from 17,759 at March 31, 2025. The cure rate for new defaults was 26% in Q2 2025, a significant decrease from 66% in Q1 2025. The net reserve for losses and LAE increased to $304.0 million at the end of Q2 2025 | Metric | Q2 2025 | Q1 2025 | Q4 2024 | Q3 2024 | Q2 2024 | | :-------------------------- | :------ | :------ | :------ | :------ | :------ | | Beginning Default Inventory | 17,759 | 18,439 | 15,906 | 13,954 | 13,992 | | New Defaults | 8,810 | 9,664 | 11,136 | 9,984 | 8,119 | | Cures | (9,078) | (10,173)| (8,408) | (7,819) | (7,956) | | Ending Default Inventory | 17,255 | 17,759 | 18,439 | 15,906 | 13,954 | | Cure Rate | 26% | 66% | 77% | 83% | 88% | | Total Paid for Claims ($k) | $9,007 | $6,330 | $7,740 | $5,749 | $5,566 | | Severity | 67% | 70% | 68% | 58% | 60% | | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :---------------- | :------------ | | Net Reserve for Losses and LAE (EOP) | $303,986 | $297,777 | $273,501 | $220,085 | | Incurred Losses and LAE (period) | $15,323 | $30,720 | $37,236 | $(1,227) | [Detail of Reserves by Default Delinquency - U.S. Mortgage Insurance Portfolio](index=15&type=section&id=Detail%20of%20Reserves%20by%20Default%20Delinquency%20-%20U.S.%20Mortgage%20Insurance%20Portfolio) As of June 30, 2025, the total case reserves for losses and LAE were $319.4 million across 17,255 defaulted policies. Policies with four or more missed payments account for a significant portion of both defaulted policies (52%) and case reserves (79%). The overall default rate was 2.12% | Missed Payments | Number of Policies in Default (June 30, 2025) | Percentage of Policies in Default (June 30, 2025) | Amount of Reserves ($ thousands) (June 30, 2025) | Percentage of Reserves (June 30, 2025) | | :---------------- | :-------------------------------------------- | :------------------------------------------------ | :----------------------------------------------- | :------------------------------------- | | Two payments | 5,634 | 33% | $29,534 | 9% | | Three payments | 2,375 | 14% | $23,028 | 7% | | Four to eleven payments | 6,644 | 38% | $134,497 | 42% | | Twelve or more payments | 2,388 | 14% | $118,154 | 37% | | Total Case Reserves | 17,255 | 100% | $319,408 | 100% | | Total Reserves for Losses and LAE | N/A | N/A | $345,952 | N/A | | Default Rate | 2.12% | N/A | N/A | N/A | - The average reserve per default (total) increased to **$20.0 thousand** at June 30, 2025, from **$16.8 thousand** at December 31, 2024[46](index=46&type=chunk) [Investments Available for Sale](index=16&type=section&id=Investments%20Available%20for%20Sale) Essent's total investments available for sale increased to $5.97 billion at June 30, 2025, from $5.88 billion at December 31, 2024. Corporate debt securities represent the largest asset class (32.0%), and the portfolio maintains a high credit quality, with 54.4% rated Aa1 or higher | Asset Class (in thousands) | June 30, 2025 (Fair Value) | June 30, 2025 (Percent) | December 31, 2024 (Fair Value) | December 31, 2024 (Percent) | | :------------------------- | :------------------------- | :---------------------- | :----------------------------- | :-------------------------- | | Corporate debt securities | $1,908,167 | 32.0% | $1,783,046 | 30.3% | | U.S. agency mortgage-backed securities | $1,172,715 | 19.7% | $1,125,436 | 19.2% | | Asset-backed securities | $796,065 | 13.4% | $631,959 | 10.8% | | Total investments available for sale | $5,966,537 | 100.0% | $5,876,721 | 100.0% | | Credit Rating (in thousands) | June 30, 2025 (Fair Value) | June 30, 2025 (Percent) | December 31, 2024 (Fair Value) | December 31, 2024 (Percent) | | :--------------------------- | :------------------------- | :---------------------- | :----------------------------- | :-------------------------- | | Aaa | $816,766 | 15.2% | $2,513,014 | 48.1% | | Aa1 | $1,815,159 | 33.7% | $101,809 | 2.0% | | Aa2 | $297,712 | 5.5% | $301,080 | 5.8% | | Total (excluding money market funds) | $5,385,573 | 100.0% | $5,219,116 | 100.0% | - The pre-tax investment income yield for the three months ended June 30, 2025, was **3.85%**[52](index=52&type=chunk) [U.S. Mortgage Insurance Company Capital](index=17&type=section&id=U.S.%20Mortgage%20Insurance%20Company%20Capital) Essent's U.S. Mortgage Insurance Subsidiaries reported combined statutory capital of $3.71 billion at June 30, 2025, with a PMIERs sufficiency ratio of 176%. Essent Guaranty, Inc.'s risk-to-capital ratio was 9.2:1, indicating a strong capital position | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | June 30, 2024 | | :-------------------------- | :------------ | :------------- | :---------------- | :------------ | | Combined Statutory Capital | $3,714,146 | $3,642,374 | $3,594,381 | $3,530,462 | | Combined Net Risk in Force | $33,986,508 | $34,968,089 | $35,159,976 | $34,812,227 | | Essent Guaranty, Inc. Risk-to-Capital Ratio | 9.2:1 | 9.6:1 | 9.8:1 | 10.2:1 | | PMIERs Available Assets | $3,654,460 | $3,628,675 | $3,612,993 | $3,513,609 | | PMIERs Minimum Required Assets | $2,075,409 | $2,107,620 | $2,029,738 | $2,052,135 | | PMIERs Sufficiency Ratio | 176% | 172% | 178% | 171% | | Essent Reinsurance Ltd. Stockholder's Equity (GAAP) | $1,751,720 | $1,780,924 | $1,773,044 | $1,793,777 | - Essent Guaranty of PA, Inc. commuted its outstanding risk in force back to Essent Guaranty and surrendered its insurance license effective December 31, 2024, consolidating capital reporting to Essent Guaranty only[57](index=57&type=chunk) [Historical Quarterly Segment Information](index=18&type=section&id=Historical%20Quarterly%20Segment%20Information) The Mortgage Insurance segment reported total revenues of $289.8 million in Q2 2025, with an income before income tax expense of $238.2 million. The Corporate & Other segment, which includes title insurance and holding company operations, reported a loss before income tax expense of $(7.0) million | Metric (in thousands) | Mortgage Insurance (Q2 2025) | Corporate & Other (Q2 2025) | Consolidated (Q2 2025) | | :-------------------------- | :--------------------------- | :-------------------------- | :--------------------- | | Net Premiums Earned | $233,907 | $14,902 | $248,809 | | Net Investment Income | $48,892 | $10,397 | $59,289 | | Total Revenues | $289,817 | $29,326 | $319,143 | | Provision for Losses and LAE | $15,359 | $1,696 | $17,055 | | Income (Loss) before Income Tax Expense | $238,206 | $(7,031) | $231,175 | | Loss Ratio | 6.6% | N/A | N/A | | Expense Ratio | 15.5% | N/A | N/A | | Combined Ratio | 22.1% | N/A | N/A | - The Mortgage Insurance segment's combined ratio improved to **22.1%** in Q2 2025 from **31.8%** in Q1 2025, primarily due to a lower loss ratio[60](index=60&type=chunk)

Core Viewpoint - Essent Group Ltd. is expected to report a decline in quarterly earnings while showing slight revenue growth in the upcoming earnings release [1]. Financial Performance - The company is projected to report earnings of $1.71 per share for the second quarter, down from $1.91 per share in the same period last year [1]. - Quarterly revenue is expected to be $317.85 million, compared to $312.94 million a year earlier [1]. - Essent Group had previously posted better-than-expected earnings for the first quarter on May 9 [1]. Stock Performance - Essent Group shares fell by 1.4%, closing at $57.02 on Thursday [2]. - Analysts have provided various ratings and price targets for the stock, indicating mixed sentiments among them [4]. Analyst Ratings - Keefe, Bruyette & Woods downgraded the stock from Outperform to Market Perform, raising the price target from $65 to $67 [4]. - Compass Point maintained a Buy rating and increased the price target from $62 to $69 [4]. - JP Morgan upgraded the stock from Neutral to Overweight with a price target of $60 [4]. - RBC Capital reiterated an Outperform rating with a price target of $67 [4]. - Goldman Sachs maintained a Neutral rating and cut the price target from $68 to $60 [4].

Company Overview - Essent Group (ESNT) is expected to report a year-over-year decline in earnings of 12% with an EPS of $1.68 for the quarter ended June 2025, while revenues are projected to increase by 1.4% to $317.15 million [3][12]. Earnings Expectations - The consensus EPS estimate has been revised down by 0.85% over the last 30 days, indicating a bearish sentiment among analysts regarding the company's earnings prospects [4][12]. - The Earnings ESP for Essent Group is -0.30%, suggesting a lower Most Accurate Estimate compared to the Zacks Consensus Estimate, which complicates the prediction of an earnings beat [12]. Historical Performance - In the last reported quarter, Essent Group exceeded the consensus EPS estimate of $1.66 by delivering earnings of $1.69, resulting in a surprise of +1.81% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates two times [14]. Industry Context - In the broader insurance industry, Ambac Financial Group (AMBC) is expected to report a loss of $0.24 per share, reflecting a significant year-over-year decline of 233.3%, with revenues anticipated to drop by 47.1% to $55.59 million [18][19]. - Ambac's consensus EPS estimate has been revised 25% higher recently, leading to a positive Earnings ESP of +12.5%, indicating a likelihood of beating the consensus EPS estimate [19][20].

Financial Data and Key Metrics Changes - Revenue for H1 2025 was GBP 152.4 million, reflecting a 1.1% decrease on a constant currency basis [6][8] - Adjusted operating profit was GBP 16.5 million, with a margin of 10.8% [6][8] - Adjusted earnings per share stood at 3.4p, with a cash conversion rate of 105.5% [7][8] - Net debt to adjusted EBITDA ratio increased to 1.5x, while return on invested capital was 9.3% [7][8] Business Line Data and Key Metrics Changes - EMEA region experienced a 4.5% decline in revenue, but showed sequential improvement [12][24] - Americas region returned to growth with a 0.7% increase in revenue, despite tariff challenges [12][29] - APAC region performed strongly with a 9.5% revenue increase [12][35] Market Data and Key Metrics Changes - The overall market remains choppy with macroeconomic challenges impacting performance [2][4] - Sequential revenue and order intake improvements were noted, particularly in energy transition and digital infrastructure markets [3][4] - FX translation negatively impacted revenue by 3.5%, equating to approximately GBP 5.5 million [13] Company Strategy and Development Direction - The company is focused on winning new business in positive markets, particularly in energy transition and digital infrastructure [3][4] - There is an emphasis on new product introductions and operational initiatives to drive growth [3][4] - The company aims for a long-term adjusted operating margin target of 18% by 2030, with current expectations for margin improvement in H2 2025 [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about the second half of 2025, expecting improvements in trading conditions and margins [52][54] - The company remains well-positioned to navigate market uncertainties and capitalize on growth opportunities as they arise [4][54] - Management highlighted the importance of maintaining flexibility in operations to respond to market dynamics [45][54] Other Important Information - An interim dividend of 0.8p per share was declared, to be paid in October [7] - The company is actively pursuing M&A opportunities, with a focus on accretive transactions [48][49] - Sustainability initiatives are progressing, with the launch of a 100% post-consumer recycled product [46] Q&A Session Summary Question: Can you elaborate on the pricing initiatives and dynamic pricing strategies? - Management discussed a detailed approach to pricing control, focusing on discount management and average selling prices to enhance overall pricing strategy [58][60] Question: What is the status of the ERP rollout? - The ERP rollout is progressing well, with the UK planned for December and Turkey expected to follow in summer 2026 [63][64] Question: How is the defense market progressing for the company? - The company is seeing some wins in the defense sector, particularly in access hardware for specialized vehicles, although it remains a small segment [65][66] Question: How much of the pricing benefits are from pricing sophistication versus passing on inflation? - Management indicated that while it is challenging to differentiate, the new pricing tools should help outperform inflation more effectively than in the past [69][71] Question: What is the expected EBIT margin benefit from closing facilities in Costa Rica and Japan? - The closure of these facilities is expected to yield annualized benefits of approximately GBP 1 million to GBP 1.5 million [81] Question: Can you provide context on the situation in Turkey during the first half? - Management noted that high minimum wage increases and sluggish domestic demand impacted margins, but improvements were seen in Q2 [87][88]

Financial Performance - Total revenue decreased to £152.4 million, compared to £159.7 million in H1 2024[10, 11] - Adjusted operating profit decreased to £16.5 million, compared to £21.8 million in H1 2024[10, 11] - Adjusted operating profit margin decreased to 10.8%, compared to 13.7% in H1 2024[10, 11] - Adjusted basic EPS decreased to 3.4p, compared to 4.6p in H1 2024[10, 11] - Adjusted profit before tax decreased to £12.5 million, compared to £17.7 million in H1 2024[11] Regional Performance - EMEA revenue decreased to £82.0 million, compared to £89.4 million in H1 2024[31] - Americas revenue decreased to £50.0 million, compared to £51.3 million in H1 2024[34] - APAC revenue increased to £20.4 million, compared to £19.0 million in H1 2024[37] Strategic Initiatives - The company is targeting a medium-term adjusted operating margin of approximately 18%[25, 26] - The company is focused on market share growth and delivering on elements within its control[60] - The company is driving operational excellence to ensure enhanced levels of customer service[61] - The company is increasing its product offering in faster-growing end-markets, including selective bolt-on M&A[61]