MANAGING OLD REPUBLIC FOR THE LONG RUN Investor Presentation 2nd Quarter 2024 OLD REPUBLIC Preliminary Matters Forward Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The words "expect," "estimate," "anticipate," "predict" and similar expressions, and the negatives thereof, often identify forward-looking statements, which are not limited to historical facts. Forwar ...

A more detailed listing and discussion of the risks and other factors which affect the Company's risk-taking insurance business are included in Part I, Item 1A - Risk Factors, of the Company's 2023 Form 10-K, and the various risks, uncertainties, and other factors that are included from time to time in other Securities and Exchange Commission filings. 2 Together, these factors produced highly profitable combined ratios and strong pretax operating income for the quarter. For General Insurance, we target comb ...

This quarterly report represents an earnings surprise of 24.59%. A quarter ago, it was expected that this insurance underwriter would post earnings of $0.66 per share when it actually produced earnings of $0.67, delivering a surprise of 1.52%. Old Republic, which belongs to the Zacks Insurance - Multi line industry, posted revenues of $2.01 billion for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 4.87%. This compares to year-ago revenues of $1.83 billion. The company has topped co ...

While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. Revenues are expected to be $1.92 billion, up 4.9% from the year-ago quarter. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. The Zacks Earnings ESP c ...

Old Republic International Corporation's (ORI) solid market presence, niche focus, low property catastrophe exposure in its General Insurance segment and strong capital position make it worth adding to one's portfolio. The Zacks Consensus Estimate for Old Republic's 2024 earnings per share indicates a year-over-year increase of 3.8%. The consensus estimate for revenues is pegged at $7.96 billion, implying a year-over-year improvement of 6.8%. Earnings Surprise History ORI currently carries a Zacks Rank #2 ( ...

Company Overview - Old Republic International (ORI) is headquartered in Chicago and operates in the Finance sector, with a stock price change of 8.1% since the start of the year [3] - The company currently pays a dividend of $0.26 per share, resulting in a dividend yield of 3.34%, which is higher than the Insurance - Multi line industry's yield of 2.24% and the S&P 500's yield of 1.57% [3] Dividend Performance - The current annualized dividend of $1.06 represents an 8.2% increase from the previous year [4] - Over the last 5 years, ORI has increased its dividend 5 times, averaging an annual increase of 5.36% [4] - The company's payout ratio is currently 39%, indicating that it paid out 39% of its trailing 12-month EPS as dividends [4] Earnings Growth - The Zacks Consensus Estimate for ORI's earnings in 2024 is $2.73 per share, reflecting a year-over-year earnings growth rate of 3.80% [5] Investment Appeal - ORI is considered an attractive dividend play and a compelling investment opportunity, holding a Zacks Rank of 2 (Buy) [7]

Analysts don't randomly choose which stocks to cover. Their decision is typically driven by significant investor interest or promising prospects associated with a particular stock. An interesting observation is that when stocks receive new analyst coverage, they often experience gradual upward price movements compared to those already covered by analysts. The magnitude of this price movement is influenced by the recommendations made by the new analysts. Positive recommendations like "Buy" and "Strong Buy" t ...

Bottom Line Investors like dividends for many reasons; they greatly improve stock investing profits, decrease overall portfolio risk, and carry tax advantages, among others. But, not every company offers a quarterly payout. High-growth firms or tech start-ups, for example, rarely provide their shareholders a dividend, while larger, more established companies that have more secure profits are often seen as the best dividend options. Income investors have to be mindful of the fact that high-yielding stocks te ...

Core Points - Old Republic International Corporation declared a quarterly cash dividend of 26.5 cents per common share, payable on June 14, 2024, to shareholders of record on June 4, 2024 [1] - The total cash dividend for the year is projected to be $1.06 per share, representing an 8.2% increase from the $0.98 paid in 2023 [1] - 2024 marks the 43rd consecutive year of dividend increases and the 83rd year of uninterrupted dividend payments [2] Company Overview - Old Republic International Corporation is one of the 50 largest shareholder-owned insurance businesses in the United States and is listed in the Fortune 500 [3] - The company operates as an insurance holding company with subsidiaries that provide risk management services primarily in general and title insurance [3] - Old Republic's general insurance business ranks among the nation's 50 largest, while its title insurance business is the third largest in its industry [3]

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This part covers the company's consolidated financial statements, notes, management's analysis of financial position and operations, market risk disclosures, and internal controls [Consolidated Financial Statements](index=3&type=section&id=CONSOLIDATED%20FINANCIAL%20STATEMENTS) The consolidated financial statements for the quarter ended March 31, 2024, show a significant increase in net income to $316.7 million from $199.8 million in the prior-year quarter, driven by higher total revenues. Total assets grew to $27.06 billion from $26.50 billion at year-end 2023. However, comprehensive income decreased to $243.7 million from $339.7 million year-over-year, primarily due to unrealized losses on investments. Cash flow from operations remained stable, while financing activities saw a net inflow from a new debt issuance, partially offset by share repurchases and dividends Consolidated Balance Sheet Highlights ($ in Millions) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$27,064.3** | **$26,501.4** | | Total Investments | $16,324.5 | $15,867.7 | | Total Liabilities | $20,663.3 | $20,090.7 | | **Total Common Shareholders' Equity** | **$6,400.9** | **$6,410.7** | Consolidated Income Statement Highlights ($ in Millions, Except Share Data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total Revenues | $2,015.9 | $1,758.7 | | Net Premiums Earned | $1,574.6 | $1,496.2 | | Net Investment Income | $164.1 | $137.8 | | **Net Income** | **$316.7** | **$199.8** | | Diluted EPS | $1.15 | $0.68 | - Comprehensive income for Q1 2024 was **$243.7 million**, a decrease from **$339.7 million** in Q1 2023, primarily driven by a net unrealized loss on investments of **$73.0 million** in Q1 2024, compared to a net unrealized gain of **$139.8 million** in the prior-year period[10](index=10&type=chunk) Consolidated Cash Flow Highlights ($ in Millions) | Cash Flow Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $160.4 | $156.6 | | Net Cash from Investing Activities | ($355.2) | $49.3 | | Net Cash from Financing Activities | $128.4 | ($193.3) | [Notes to Consolidated Financial Statements](index=8&type=section&id=NOTES%20TO%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) The notes detail the company's accounting policies and provide further information on key financial statement items. A significant event is the pending sale of the RMIC Companies, Inc. (RMICC) for approximately $140 million, which is now classified as held-for-sale. The investment portfolio remains concentrated in available-for-sale fixed income securities, with fair value changes impacting equity. Loss reserves saw favorable development, primarily from General Insurance. The company issued $400 million in new senior notes and was active in its share repurchase program, buying back $194.4 million in shares during the quarter - The company operates through two main segments: General Insurance (property and liability) and Title Insurance, with RFIG Run-off business results now included in the Corporate & Other category[15](index=15&type=chunk)[61](index=61&type=chunk) - A definitive agreement was reached on November 11, 2023, to sell RMIC Companies, Inc. (RMICC) to Arch Capital Group Ltd. for approximately **$140 million**, with the transaction expected to close in Q2 2024 and accounted for as held-for-sale[34](index=34&type=chunk)[35](index=35&type=chunk) - Favorable prior-year loss reserve development in Q1 2024 was primarily driven by workers' compensation and commercial auto lines in the General Insurance segment, and from the 2019-2021 years in the Title Insurance segment[49](index=49&type=chunk)[50](index=50&type=chunk) - In Q1 2024, the company issued **$400.0 million** of 5.750% Senior Notes due 2034, increasing total debt to **$1,987.6 million**[56](index=56&type=chunk) - Under its share repurchase programs, the company repurchased **6.6 million** shares for **$194.4 million** in Q1 2024, and a new **$1.1 billion** share repurchase program was authorized in March 2024[58](index=58&type=chunk)[59](index=59&type=chunk) [Management Analysis of Financial Position and Results of Operations](index=18&type=section&id=MANAGEMENT%20ANALYSIS%20OF%20FINANCIAL%20POSITION%20AND%20RESULTS%20OF%20OPERATIONS) Management's analysis highlights a 3.9% increase in pretax operating income to $231.5 million, driven by strong performance in the General Insurance segment which offset a decline in Title Insurance. Consolidated net premiums and fees grew 5.6%, while the combined ratio increased to 94.3% from 92.7% year-over-year. Net investment income rose 19.1% due to higher yields. The financial position remains strong, with total assets increasing and a continued focus on high-quality investments. The company returned $264 million to shareholders through dividends and share repurchases during the quarter [Executive Summary](index=20&type=section&id=EXECUTIVE%20SUMMARY) This section provides an overview of the company's financial performance, highlighting key drivers such as increased pretax operating income, growth in premiums and investment income, and capital returns to shareholders Overall Results Summary ($ in Millions) | Metric | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | Pretax income excluding investment gains | $231.5 | $222.9 | 3.9% | | Net income excluding investment gains | $184.7 | $179.2 | 3.1% | | Net income per diluted share excluding investment gains | $0.67 | $0.61 | 9.8% | - Key performance drivers for Q1 2024 include a **5.6%** increase in consolidated net premiums and fees, a **19.1%** rise in net investment income, and a total of **$264 million** in capital returned to shareholders via dividends and buybacks[79](index=79&type=chunk) - Book value per share increased **2.2%** to **$23.83** at March 31, 2024, from **$23.31** at December 31, 2023[78](index=78&type=chunk) [Results of Operations](index=21&type=section&id=RESULTS%20OF%20OPERATIONS) This section details the company's consolidated income sources and combined ratio, showing segment-wise performance and factors influencing profitability Sources of Consolidated Income ($ in Millions) | Segment | Q1 2024 Pretax Operating Income | Q1 2023 Pretax Operating Income | % Change | | :--- | :--- | :--- | :--- | | General Insurance | $220.4 | $193.2 | 14.1% | | Title Insurance | $2.3 | $17.4 | (86.4)% | | Corporate & Other | $8.8 | $12.3 | (28.6)% | | **Consolidated** | **$231.5** | **$222.9** | **3.9%** | Consolidated Combined Ratio | Ratio Component | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Loss Ratio | 42.5% | 38.8% | | Expense Ratio | 51.8% | 53.9% | | **Combined Ratio** | **94.3%** | **92.7%** | - The consolidated loss ratio increased, primarily due to a change in business mix with a lower contribution from Title Insurance (which has a lower loss ratio) and less favorable prior year reserve development compared to Q1 2023[109](index=109&type=chunk)[110](index=110&type=chunk) [Segment Overview](index=33&type=section&id=Segment%20Overview) This section provides a detailed analysis of the performance of the General Insurance and Title Insurance segments, including their respective premiums, operating income, and combined ratios General Insurance Segment Highlights | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Premiums Earned | $1,091.6M | $965.1M | | Pretax Operating Income | $220.4M | $193.2M | | Combined Ratio | 90.3% | 89.3% | - General Insurance premium growth of **13.1%** was driven by rate increases, high retention, and new business, particularly in commercial auto, property, and general liability lines[86](index=86&type=chunk)[122](index=122&type=chunk) Title Insurance Segment Highlights | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net Premiums & Fees Earned | $545.4M | $583.2M | | Pretax Operating Income | $2.3M | $17.4M | | Combined Ratio | 102.5% | 99.3% | - Title Insurance revenues declined **6.5%** due to a drop in mortgage originations from higher interest rates, leading to a significant decrease in profitability and an underwriting loss, as indicated by the **102.5%** combined ratio[91](index=91&type=chunk)[127](index=127&type=chunk) [Financial Position](index=36&type=section&id=FINANCIAL%20POSITION) This section describes the company's balance sheet, investment portfolio allocation, capitalization, debt-to-equity ratio, and dividend policy - The consolidated investment portfolio as of March 31, 2024, was allocated approximately **84%** to fixed income and short-term investments and **16%** to equity securities, with a focus on high-quality, marketable securities[98](index=98&type=chunk)[135](index=135&type=chunk) - Total capitalization stood at **$8.39 billion** at March 31, 2024, with a debt-to-equity ratio of **31.1%**, temporarily elevated due to a recent **$400 million** senior note issuance intended to retire maturing debt later in 2024[148](index=148&type=chunk)[149](index=149&type=chunk) - The company has paid a cash dividend for **83** consecutive years and has increased it for the past **43** years[150](index=150&type=chunk) [Quantitative and Qualitative Disclosure About Market Risk](index=37&type=section&id=QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURE%20ABOUT%20MARKET%20RISK) The company's primary market risks are interest rate risk from its fixed income portfolio and equity price risk from its equity investments. There have been no material changes in these market risk exposures since the 2023 Annual Report on Form 10-K - The company's main market risks are interest rate risk and equity price risk, with no material foreign exchange or commodity risk[166](index=166&type=chunk) - Market risk exposures as of March 31, 2024, have not changed materially from those disclosed in the 2023 Form 10-K[167](index=167&type=chunk) [Controls and Procedures](index=37&type=section&id=CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2024. There were no material changes to the internal control over financial reporting during the first quarter - The principal executive and financial officers concluded that the company's disclosure controls and procedures were effective as of the end of the reporting period[168](index=168&type=chunk) - No changes in internal control over financial reporting occurred during Q1 2024 that have materially affected, or are reasonably likely to materially affect, the company's internal controls[169](index=169&type=chunk) [PART II OTHER INFORMATION](index=38&type=section&id=PART%20II%20OTHER%20INFORMATION) This part addresses legal proceedings, risk factors, equity security sales, other disclosures, and a list of exhibits filed with the report [Legal Proceedings](index=38&type=section&id=ITEM%201%20-%20LEGAL%20PROCEEDINGS) The company reports no material non-claim related legal proceedings as of March 31, 2024. Legal proceedings that do arise are typically in the normal course of business and pertain to claim matters - As of March 31, 2024, the Company had no material non-claim litigation exposures in its consolidated business[60](index=60&type=chunk)[173](index=173&type=chunk) [Risk Factors](index=38&type=section&id=ITEM%201A%20-%20RISK%20FACTORS) There have been no material changes to the risk factors previously disclosed in the company's 2023 Annual Report on Form 10-K - No material changes have occurred with respect to the risk factors disclosed in the Company's 2023 Annual Report on Form 10-K[174](index=174&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=38&type=section&id=ITEM%202%20-%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) During the first quarter of 2024, the company completed its $450 million share repurchase program and initiated a new $1.1 billion program. A total of 6.68 million shares were repurchased for approximately $192.5 million during the quarter Share Repurchase Activity for Q1 2024 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | January 2024 | 234,397 | $28.05 | | February 2024 | 2,701,428 | $28.05 | | March 2024 | 3,742,043 | $29.46 | | **Total Q1 2024** | **6,677,868** | **$28.84** | - The company completed its **$450 million** share repurchase authorization from May 2023 and began a new **$1.1 billion** authorization announced on March 1, 2024[175](index=175&type=chunk) [Other Information](index=38&type=section&id=ITEM%205%20-%20OTHER%20INFORMATION) During the first quarter of 2024, no directors or officers adopted or terminated a Rule 10b5-1 trading arrangement for the purchase or sale of the company's securities - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the quarter ended March 31, 2024[176](index=176&type=chunk) [Exhibits](index=39&type=section&id=ITEM%206%20-%20EXHIBITS) This section lists the exhibits filed with the Form 10-Q, including supplemental indentures, forms of award agreements for the stock incentive plan, and officer certifications as required by the Sarbanes-Oxley Act - Exhibits filed with the report include an Eighth Supplemental Indenture, forms of award agreements under the 2022 Stock Incentive Plan, and CEO/CFO certifications pursuant to Sarbanes-Oxley Sections 302 and 906[177](index=177&type=chunk)[178](index=178&type=chunk)