Global Indemnity Group (GBLI) Q1 2025 Earnings Call May 07, 2025 11:00 AM ET Speaker0 Thank you for standing by. My name is Kayla, I will be your conference operator today. At this time, I'd like to welcome everyone to the Global Indemnity Group First Quarter twenty twenty five Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. We will also be taking questions from the webcast. I would now like to turn ...

Financial Performance - The net loss available to common shareholders for Q1 2025 was $4.1 million, or ($0.30) per share, including a $12.2 million loss attributed to California Wildfires[1] - Excluding California Wildfires, net income available to common shareholders was $8.1 million, or $0.58 per share, compared to $11.3 million, or $0.82 per share in Q1 2024[2] - Net income available to common shareholders was a loss of $4,099 million in Q1 2025, compared to a profit of $11,256 million in Q1 2024[17] - The net income available to common shareholders excluding California Wildfires for Q1 2025 was $8,117,000, down from $11,256,000 in Q1 2024[27] - The operating income excluding California Wildfires for Q1 2025 was $8,121,000, compared to $10,692,000 in Q1 2024[27] Premiums and Underwriting - Gross written premiums increased by 6% to $98.7 million in Q1 2025, with a 16% increase to $98.4 million when excluding terminated products[2] - Total direct written premiums decreased by 4.0% to $87,467 million in Q1 2025 from $91,132 million in Q1 2024[14] - InsurTech segment saw a significant growth of 20.1%, with direct written premiums reaching $15,020 million compared to $12,508 million in the previous year[14] - Belmont Core segment reported a remarkable increase of 274.6% in assumed written premiums, totaling $10,922 million, up from $2,916 million[15] - Gross written premiums increased to $98,675 million in Q1 2025, compared to $93,488 million in Q1 2024, reflecting a growth of 5.0%[17] Losses and Expenses - Net losses and loss adjustment expenses rose to $66,738 million, up from $53,384 million, indicating a significant increase in claims[17] - The California Wildfires resulted in net losses and loss adjustment expenses of $15,600,000 for the current accident year[27] Ratios and Financial Metrics - The current accident year combined ratio was 111.5% in Q1 2025, compared to 94.9% in Q1 2024; excluding California Wildfires, it would have been 94.8%[2] - The combined ratio deteriorated to 111.7% in Q1 2025 from 94.9% in Q1 2024, highlighting increased underwriting losses[17] - The current accident year underwriting income (loss) was a loss of $10,328,000 in Q1 2025, compared to an income of $5,272,000 in Q1 2024[27] - The current accident year combined ratio excluding California Wildfires was 94.8% in Q1 2025, compared to 94.9% in Q1 2024[27] - The effect of prior accident year on the combined ratio was a decrease of 0.2% in Q1 2025[27] Shareholder Equity and Book Value - Shareholders' equity decreased to $687.1 million as of March 31, 2025, from $689.1 million at December 31, 2024[2] - Book value per common share fell to $47.85 at March 31, 2025, down from $49.98 at December 31, 2024[2] Investment Performance - Net investment income rose by 2% to $14.8 million in Q1 2025 compared to the same period in 2024[2] - The total annualized investment return remained stable at 5.4% for both Q1 2025 and Q1 2024, indicating consistent investment performance[21] Corporate Developments - The Company executed an extensive internal business reorganization to enhance operational efficiency and statutory capital[7] - The appointment of Praveen Reddy as President and CEO of Penn-America Underwriters marks a strategic investment to develop agency capabilities[7] Assets and Cash Position - Cash and cash equivalents increased significantly to $81,146 million as of March 31, 2025, compared to $17,009 million at the end of 2024[19] - Total assets decreased to $1,713,606 million from $1,731,253 million, reflecting a decline in overall asset value[19] Company Overview - Global Indemnity Group, LLC is a publicly listed holding company for property and casualty insurance-related businesses[28] - The company does not assume any obligation to update forward-looking statements after the date they were made[30]

Global Indemnity Group, LLC (NYSE:GBLI) Q4 2024 Earnings Conference Call March 11, 2025 11:00 AM ET Company Participants Evan Kasowitz - SVP, Operations Jay Brown - CEO Brian Riley - CFO Conference Call Participants Tom Kerr - Zacks Small-Cap Research Ross Haberman - RLH Investments Operator Ladies and gentlemen, thank you for standing by. My name is Kate, and I will be your conference operator today. At this time, I would like to welcome everyone to the Global Indemnity Group 2024 earnings call. All lines ...

Financial Data and Key Metrics Changes - Net income increased to $43.2 million in 2024 from $25.4 million in 2023, with a per-share value increase from $47.53 to $49.98 [24] - Investment income rose by 13% to $62.4 million compared to the previous year [25] - The consolidated accident year combined ratio improved to 95.4% in 2024 from 97.3% in 2023 [29] Business Line Data and Key Metrics Changes - Penn America segment's gross premiums increased by 12% in 2024, driven by a 17% growth in Insurtech and 12% growth in wholesale commercial [10] - Underwriting income for Penn America rose to $22.1 million in 2024 from $18.5 million in 2023 [30] - The assumed reinsurance business grew significantly, with gross written premiums increasing to $25.4 million from $13.9 million in 2023 [40] Market Data and Key Metrics Changes - Total catastrophe losses decreased by approximately 26% from 2023, with total cat losses for 2024 at $12.7 million compared to $13.8 million in 2023 [13][31] - The expense ratio for Penn America improved to 38.1% in 2024, with a target to reduce it further to 37% or lower [16] Company Strategy and Development Direction - The company is focusing on enhancing underwriting capabilities and expanding product offerings through strategic hires and technology investments [20][88] - A multi-year technology transformation is underway, with over 75% of the transition to the cloud completed [17] - The company aims for a revenue growth of 10% from Penn America in 2025, alongside improvements in non-catastrophe accident year loss ratios [41] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving long-term metrics for revenue growth and underwriting profits, despite challenges in the regulatory environment affecting rate increases [8][72] - The company is reassessing its catastrophe models due to unexpected losses from recent wildfires, indicating a need for adjustments in risk assessment [65][68] Other Important Information - Discretionary capital increased to $255 million at the end of 2024, compared to $200 million in 2023, providing more capacity for growth initiatives [42] - The average credit quality of the fixed income portfolio remains at double A, with a current book yield of 4.4% [27] Q&A Session Summary Question: Regarding the California fires, was it an underwriting issue or rate increase challenge? - Management indicated that they have been seeking rate increases but faced regulatory challenges, resulting in a sizable loss from a limited number of properties [46] Question: Can you provide more details on the reinsurance segment growth and future plans? - The reinsurance segment has grown to 16 treaties with expectations for continued growth in 2025 and 2026 [49] Question: What is the total exposure in California and is it on the direct commercial side? - The total exposure in California is about six basis points of the total market, all on the direct book [58] Question: What kind of rate increases do you expect in California following the recent wildfire? - Management expects at least a 50% increase on affected business types, but noted that achieving this in California's regulatory environment is challenging [72] Question: Is there room to reduce the expense ratio without compromising underwriting quality? - Management believes there is room to reduce the expense ratio and plans to improve it as they run off terminated business [80]

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, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ___________ to ___________ 001-34809 Commission File Number GLOBAL INDEMNITY GROUP, LLC (Exact name of registrant as specified in its charter) (State or other jurisdiction De ...

Financial Performance - Net income available to shareholders increased 71% to $42.8 million or $3.12 per share for 2024 compared to $25.0 million or $1.83 per share in 2023[2] - Operating income rose 58% to $42.9 million in 2024 from $27.2 million in 2023[2] - Underwriting income improved to $19.7 million in 2024, compared to a loss of $11.6 million in 2023[12] - Operating income, net of tax, increased to $42.9 million in 2024, up from $27.2 million in 2023[16] - Operating income per share, diluted, rose to $3.10 in 2024 from $1.96 in 2023[16] Premiums and Underwriting - Penn-America gross written premiums increased 12% to $395.1 million in 2024 compared to $352.4 million in 2023[2] - Gross written premiums for 2024 increased to $400.0 million, up 8% from $369.7 million in 2023[12] - Net earned premiums rose to $369.8 million in 2024, compared to $354.5 million in 2023, reflecting a 4% increase[12] - Current accident year underwriting income grew to $18.8 million in 2024, up from $14.3 million in 2023, with a combined ratio of 95.4%[2] - The combined ratio for 2024 was 95.0%, a significant improvement from 103.6% in 2023[12] - The combined ratio improved to 95.6% in 2024 from 99.7% in 2023, indicating better underwriting performance[4] - The loss ratio for the current accident year decreased to 56.4% in 2024 from 57.4% in 2023[12] Investment Performance - Investment income increased 13% to $62.4 million in 2024, driven by a book yield increase to 4.4% from 4.0%[2] - Net investment income for 2024 was $62.4 million, up from $55.4 million in 2023[14] - The total investment return percentage for 2024 was 5.5%, slightly down from 5.7% in 2023[14] Assets and Ratings - Cash and invested assets rose to $1.44 billion as of December 31, 2024, compared to $1.39 billion in 2023[4] - Total cash and invested assets, net, increased to $1,440.7 million as of December 31, 2024, compared to $1,390.4 million in 2023[14] - AM Best affirmed the company's A (Excellent) rating for its U.S. insurance subsidiaries on August 1, 2024[2] Reinsurance - Assumed Reinsurance premiums surged 83% from $13.9 million in 2023 to $25.4 million in 2024 due to new treaties[2] -

Financial Data and Key Metrics Changes - Net income for the first nine months of 2024 was $34.2 million, up from $19.5 million in 2023, reflecting strong performance in both underwriting and investment income [20] - Book value per share increased from $47.53 at year-end to $49.88 at September 30, 2024, with a return to shareholders of 8.2% for the first nine months of 2024 [20] - Investment income rose 18% to $46.3 million compared to the previous year, driven by actions taken to sell longer-dated securities and reinvest in higher-yielding options [21] Business Line Data and Key Metrics Changes - Gross premiums for Penn-America increased by 7.4% to $297.8 million in 2024, with a total growth of 12% including terminated programs [31] - The Specialty Products business remained flat through nine months, indicating ongoing challenges in this area [9] - The combined ratio for Penn-America improved to 93.9% in 2024 from 96.7% in 2023, reflecting better underwriting performance [24] Market Data and Key Metrics Changes - Total gross premiums decreased to $294 million in 2024 from $332 million in 2023, primarily due to the runoff of non-core segments [30] - The Wholesale Commercial segment grew by 7% to $186.9 million, while InsurTech grew by 17% to $41.9 million [32][33] Company Strategy and Development Direction - The company aims to grow its insurance business at a compound annual growth rate of at least 10% and achieve a combined ratio in the low 90s [7] - A multi-year effort to transform technology platforms is underway, with significant investments in cloud-based solutions [14] - The company is looking to expand its product offerings in 2025 and 2026 after stabilizing its existing business [42][43] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory, noting that the focus on core areas is beginning to yield positive results [18] - The outlook for 2024 and 2025 is positive, with expectations of continued strong performance in the Penn-America segment [37] - The company is actively seeking opportunities to invest in longer-duration maturities to enhance investment returns [22] Other Important Information - Catastrophe losses through nine months were down approximately 35% from 2023, indicating effective management of risk exposures [11] - Discretionary capital increased to $240 million at September 30, 2024, supporting growth initiatives [38] Q&A Session Summary Question: Can you discuss the status of discontinued lines and the timing for their runoff? - Management indicated that there is about $5 million of earned premium left to run off, expected to be fully earned by the end of 2025 [40][41] Question: Are there plans to purchase new lines of business? - Management confirmed they are looking for new opportunities but will not see significant expansions until 2025 or 2026 [42][43] Question: Did the company buy back any shares in the quarter? - Management confirmed that no shares were bought back during the quarter [44]

Financial Performance - Gross written premiums for Q3 2024 were $99,767,000, a slight increase from $98,926,000 in Q3 2023, while net written premiums rose to $97,177,000 from $95,623,000[6] - Net earned premiums decreased to $95,413,000 in Q3 2024 from $111,695,000 in Q3 2023, reflecting a decline of approximately 14.5%[6] - Net income for Q3 2024 was $12,760,000, up from $7,700,000 in Q3 2023, representing a significant increase of approximately 65.3%[6] - The company reported total revenues of $111,761,000 in Q3 2024, down from $126,061,000 in Q3 2023, indicating a decrease of about 11.4%[6] - Comprehensive income for Q3 2024 was $22,964,000, compared to $6,754,000 in Q3 2023, reflecting a substantial increase[7] - Net income for the nine months ended September 30, 2024, was $34,219,000, compared to $19,531,000 for the same period in 2023, representing a 75% increase[12] Investment Income - Net investment income increased to $16,488,000 in Q3 2024, compared to $14,200,000 in Q3 2023, marking a growth of about 16.1%[6] - The total investment return for the nine months ended September 30, 2024, was $65,580,000, compared to $43,118,000 for the same period in 2023, reflecting a significant increase of approximately 52.0%[46] - The total investment income for the nine months ended September 30, 2024, was $47,839,000, compared to $40,513,000 for the same period in 2023, marking an increase of approximately 18.0%[45] Shareholder Equity and Distributions - Total shareholders' equity increased to $686,726,000 as of September 30, 2024, from $630,655,000 a year earlier, reflecting an 8.9% growth[9] - The company declared cash distributions of $0.35 per common share in Q3 2024, up from $0.25 in Q3 2023, an increase of 40%[6] - Distributions paid to common shareholders increased to $9,816,000 in 2024 from $7,477,000 in 2023, representing a 31.1% increase[12] Restructuring and Operations - The company incurred total restructuring costs of $5.4 million from 2022 to 2023, with no additional costs reported for the nine months ended September 30, 2024[18] - The company exited four brokerage divisions as part of its restructuring plan, which was completed in the first quarter of 2023[17] - The restructuring of insurance operations led to the management of the business through two segments: Penn-America and Non-Core Operations, aimed at enhancing market presence[120] Losses and Expenses - Net losses and loss adjustment expenses for Q3 2024 were $52,400,000, down from $65,116,000 in Q3 2023, a decrease of approximately 19.5%[6] - Acquisition costs and other underwriting expenses decreased to $37,553,000 in Q3 2024 from $46,202,000 in Q3 2023, a reduction of 18.7%[6] - The total incurred losses and loss adjustment expenses for the quarter ended September 30, 2024, were $52,400 thousand, compared to $65,116 thousand for the same quarter in 2023, indicating a decrease of 19.4%[85] Cash Flow and Assets - Cash flows from operating activities provided $52,250,000 in the nine months ended September 30, 2024, compared to $36,752,000 in the prior year, indicating a 42% increase[12] - Cash and cash equivalents decreased to $31,019,000 at the end of the period from $46,470,000 a year earlier, a decline of 33.2%[12] - Total assets as of September 30, 2024, were $1,761,117,000, slightly down from $1,767,846,000 as of September 30, 2023[125] Investment Portfolio - As of September 30, 2024, the total amortized cost of fixed maturities was $1,404,854,000, with an estimated fair value of $1,395,229,000, reflecting a gross unrealized loss of $13,472,000[20] - The company’s investments in equity securities amounted to $12.3 million as of September 30, 2024, down from $16.5 million as of December 31, 2023[20] - The total gross unrealized losses for fixed maturities as of September 30, 2024, were $35,766,000, with $13,274,000 attributed to losses over 12 months[24] Tax Expenses - The total income tax expense for the quarter ended September 30, 2024, was $3,125 thousand, compared to $1,763 thousand for the same quarter in 2023, reflecting an increase of 77%[82] - The effective income tax expense for the nine months ended September 30, 2024, was $8,605 thousand, representing 20.1% of pre-tax income, compared to $4,707 thousand or 19.4% for the same period in 2023[84] Share Repurchase - The share repurchase program authorized up to $135 million has $101.0 million remaining for repurchases as of September 30, 2024[93] - During the nine months ended September 30, 2024, the company repurchased 16,527 shares at an average price of $32.00[94]

Financial Performance - Net income available to shareholders increased 77% to $33.9 million or $2.48 per share for the nine months ended September 30, 2024, compared to $19.2 million or $1.39 per share for the same period in 2023[2]. - Operating income rose 57% to $33.8 million in 2024 from $21.5 million in 2023[2]. - Annualized return on equity improved to 9.8% in 2024 from 5.2% in 2023[2]. - Operating income for the three months ended September 30, 2024, was $13,162,000, a 68.5% increase from $7,801,000 in the same period of 2023[9]. - Net income for the three months ended September 30, 2024, reached $12,760,000, compared to $7,700,000 for the same period in 2023, reflecting a 65.5% increase[9]. - For the nine months ended September 30, 2024, operating income totaled $33,790,000, compared to $21,493,000 for the same period in 2023, indicating a 57.3% increase[9]. - Net income for the nine months ended September 30, 2024, was $34,219,000, compared to $19,531,000 in the same period of 2023, marking a 75.1% increase[9]. Underwriting Performance - Current accident year underwriting income surged to $15.3 million in 2024, compared to $5.0 million in 2023, with the Penn-America segment contributing $17.6 million[2]. - Combined ratio for the current accident year improved to 93.5% in Q3 2024 from 98.6% in Q3 2023[3]. - The combined ratio for the nine months ended September 30, 2024, improved to 95.2% from 99.2% in 2023, showing a positive trend in underwriting performance[6]. - The loss ratio for the current accident year improved to 55.7% for the nine months ended September 30, 2024, down from 58.8% in 2023[6]. Investment Performance - Investment income increased 18% to $46.3 million in 2024, driven by a rise in book yield on the bond portfolio to 4.6%[2]. - Net investment income for the three months ended September 30, 2024, was $16.5 million, compared to $14.2 million in 2023, representing a growth of 16.2%[8]. - Total investment return for the nine months ended September 30, 2024, was $65.6 million, up from $43.1 million in 2023, reflecting a significant increase of 52.3%[8]. - The company reported a net unrealized investment gain of $12.8 million for the three months ended September 30, 2024, compared to a loss of $1.3 million in 2023[8]. Premiums and Growth - Gross written premiums for the Penn-America segment increased 12% to $293.0 million in 2024 from $262.8 million in 2023[2]. - Assumed Re premiums skyrocketed 131% from $8.4 million in 2023 to $19.3 million in 2024 due to new treaties[2]. - Gross written premiums for the nine months ended September 30, 2024, were $294.0 million, a decrease of 12% from $332.0 million in the same period of 2023[6]. - Net earned premiums for the nine months ended September 30, 2024, were $284.8 million, down from $380.9 million in 2023, indicating a decline of 25.2%[6]. Balance Sheet and Assets - Book value per share rose to $49.88 at September 30, 2024, from $47.53 at December 31, 2023, reflecting a 7.1% increase[2]. - Total assets increased to $1,761,117 million as of September 30, 2024, compared to $1,729,576 million at December 31, 2023, reflecting a growth of 1.8%[5]. - Total liabilities decreased to $1,074,391 million as of September 30, 2024, from $1,080,823 million at December 31, 2023, a reduction of 0.6%[5]. - Cash and cash equivalents decreased to $31,019 million as of September 30, 2024, from $38,037 million at December 31, 2023, a decline of 18.6%[5]. Ratings and Outlook - AM Best affirmed the company's A (Excellent) rating for its U.S. insurance subsidiaries on August 1, 2024[2]. - Global Indemnity's forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from estimates[12]. - The company does not assume any obligation to update forward-looking statements after the date they were made[12]. Investor Relations - Contact information for investor relations is provided, with Stephen W. Ries as the head of investor relations[13].

Financial Performance - Gross written premiums for Q2 2024 were $100,706,000, a decrease of 8.3% from $110,100,000 in Q2 2023[5] - Net earned premiums for the first half of 2024 were $189,393,000, down 29.6% from $269,228,000 in the same period of 2023[5] - Net income for Q2 2024 was $10,093,000, an increase of 8.1% compared to $9,337,000 in Q2 2023[5] - Total revenues for Q2 2024 were $108,687,000, a decrease of 23.4% from $141,893,000 in Q2 2023[5] - Comprehensive income for Q2 2024 was $12,037,000, significantly higher than $6,781,000 in Q2 2023[6] - Net income for the six months ended June 30, 2024, was $21,459,000, compared to $11,831,000 for the same period in 2023, representing an increase of 81.5%[11] - Net income for the quarter ended June 30, 2024, was $10,093,000, an increase of 8.2% from $9,337,000 in the same quarter of 2023[96] - Total revenues for the quarter ended June 30, 2024, were $93,171,000, up from $129,438,000 in the same quarter of 2023, indicating a decrease of 28%[100][101] Investment Income - Net investment income increased to $15,311,000 in Q2 2024 from $13,216,000 in Q2 2023, reflecting a growth of 15.9%[5] - The net investment income for the six months ended June 30, 2024, was $29,831,000, an increase from $25,224,000 in the same period of 2023[41] - The total investment income for the quarter ended June 30, 2024, was $15,823,000, an increase from $13,567,000 in the same quarter of 2023[40] - The total investment return for the quarter ended June 30, 2024, was $17,903,000, representing a return of 1.3%, compared to 0.7% in the same quarter of 2023[41] Shareholder Equity and Distributions - Total shareholders' equity increased to $667,490,000 as of June 30, 2024, up from $626,408,000 at the end of June 2023, reflecting a growth of 6.6%[8] - Cash distributions declared per common share increased to $0.35 in Q2 2024 from $0.25 in Q2 2023, representing a 40% increase[5] - Total distributions declared during the six months ended June 30, 2024 amounted to $9.544 million, with $4.752 million declared on March 6, 2024[80] - The company declared distributions of $0.25 per common share during the six months ended June 30, 2023, totaling $6.764 million[81] Loss Management - The company experienced a net loss and loss adjustment expense of $53,662,000 in Q2 2024, down from $78,082,000 in Q2 2023, indicating improved loss management[5] - The company reported incurred losses and loss adjustment expenses of $53.662 million for the quarter ended June 30, 2024, compared to $78.082 million for the same quarter in 2023, indicating a decrease of 31.2%[70] - The net balance for unpaid losses and loss adjustment expenses decreased to $773.814 million as of June 30, 2024, from $793.018 million in the previous year[70] Restructuring and Operational Changes - The company incurred total restructuring costs of $5.4 million from exiting four brokerage divisions, with no additional costs incurred during the first half of 2024[15] - The restructuring plan was completed in the first quarter of 2023, with the liability related to the plan being less than $0.1 million as of December 31, 2023[15] - The company restructured its insurance operations into two segments: Penn-America and Non-Core Operations, to enhance focus on core products[98] - The restructuring is expected to improve the company's overall financial performance and market positioning[98] Investment Portfolio and Valuation - As of June 30, 2024, the total amortized cost of fixed maturities was $1,362,384 thousand, with an estimated fair value of $1,340,046 thousand, reflecting a gross unrealized loss of $23,744 thousand[17] - The company reported a net realized investment loss of $1,052,000 for the six months ended June 30, 2024, compared to a gain of $2,281,000 for the same period in 2023[11] - The fair value of U.S. treasuries was reported at $699,464 thousand with gross unrealized losses of $2,585 thousand as of June 30, 2024[20] - The total fixed maturities as of December 31, 2023, had an amortized cost of $1,322,092 thousand and an estimated fair value of $1,293,793 thousand, resulting in gross unrealized losses of $29,879 thousand[22] Taxation - The total income tax expense for the quarter ended June 30, 2024, was $2.581 million, compared to $2.371 million for the same quarter in 2023, representing an increase of 8.8%[67] - The effective income tax expense for the six months ended June 30, 2024, was $5.480 million, which is 20.3% of pre-tax income, compared to $2.944 million or 19.9% for the same period in 2023[69] Share Repurchase and Stock Options - Global Indemnity Group, LLC has authorized share repurchases of up to $135 million, with $101 million remaining as of June 30, 2024[75] - During the six months ended June 30, 2024, the company repurchased 16,527 shares at an average price of $32.00 per share[76] - The company granted 550,000 Time-Based Stock Options during the six months ended June 30, 2024, with an average strike price of $30.73[91]