Financial & Operational Highlights Key Financial Metrics In Q1 2025, book value per share slightly increased to $1,752, but comprehensive income attributable to shareholders sharply dropped to $35 million due to MediaAlpha's unrealized loss, causing basic earnings per share to fall to $13.19 Book Value Per Share Comparison | Metric | March 31, 2025 | December 31, 2024 | March 31, 2024 | | :--- | :--- | :--- | :--- | | Book Value Per Share | $1,752.17 | $1,745.87 | $1,742.33 | | QTD Change (incl. dividends) | 0.4% | (2.8)% | 5.3% | Q1 Financial Performance Summary | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Comprehensive Income (Shareholders) | $35.1 million | $236.2 million | | Basic Earnings Per Share | $13.19 | $92.33 | - Effective 2025, White Mountains will no longer report adjusted book value per share, as the deconsolidation of BAM has rendered most adjustments obsolete3 CEO's Summary & Strategic Overview The CEO reported solid Q1 2025 operating results and investment returns, despite MediaAlpha's share price decline, with key units Ark, Kudu, and Bamboo demonstrating strong growth, and approximately $550 million in undeployed capital available - Ark posted a 94% combined ratio and grew gross written premiums by 27% year-over-year3 - Bamboo doubled its managed premiums on a trailing 12-month basis and tripled its MGA adjusted EBITDA year-over-year3 - The decline in MediaAlpha's share price resulted in a $37 million mark-to-market loss3 - Undeployed capital stands at approximately $550 million following new investments in BroadStreet Partners and Enterprise Solutions3 Investment Portfolio Performance The total consolidated portfolio returned 1.7% in Q1 2025, a decline from Q1 2024 due to MediaAlpha, though excluding MediaAlpha, the portfolio returned 2.3%, outperforming benchmarks Portfolio Return Comparison (Q1) | Portfolio Return | 2025 | 2024 | | :--- | :--- | :--- | | Total Consolidated | 1.7% | 4.6% | | Excluding MediaAlpha | 2.3% | 1.2% | - Excluding MediaAlpha, the equity portfolio returned 3.1%, significantly outperforming the S&P 500 Index return of -4.3%27 - The fixed income portfolio returned 1.7%, lagging the Bloomberg Intermediate Aggregate Index return of 2.6%27 Share Repurchases In Q1 2025, the company repurchased 5,097 common shares for $10 million at an average price of $1,945.06, representing 110% of book value per share, primarily for employee tax withholding obligations Q1 Share Repurchase Activity | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Shares Repurchased | 5,097 | 5,269 | | Cost | $10 million | $8 million | | Avg. Price / Share | $1,945.06 | $1,505.01 | | Price / BVPS | 110% | 86% | Segment Performance Analysis Ark/WM Outrigger The Ark/WM Outrigger segment's combined ratio increased to 97% in Q1 2025 due to catastrophe losses at WM Outrigger Re, despite strong top-line growth with gross written premiums rising to $1.1 billion Ark/WM Outrigger Key Metrics (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Gross Written Premiums | $1,108 million | $872 million | | Net Written Premiums | $728 million | $598 million | | Net Earned Premiums | $358 million | $303 million | | Combined Ratio | 97% | 91% | Ark Ark maintained a 94% combined ratio, absorbing $75 million in catastrophe losses, while gross written premiums grew 27% to $1.1 billion, driving pre-tax income to $52 million - The 94% combined ratio included 25 points of catastrophe losses from California wildfires and 14 points of net favorable prior year development6 - Gross written premiums increased 27% to $1,108 million, driven by new underwriting teams and expansion in property and specialty lines79 - Pre-tax income increased to $52 million in Q1 2025 from $33 million in Q1 20248 WM Outrigger Re WM Outrigger Re's combined ratio soared to 166% due to $19 million in net losses from California wildfires, resulting in a $6 million pre-tax loss for the quarter - The combined ratio deteriorated to 166% in Q1 2025, compared to 32% in Q1 20249 - The segment reported a pre-tax loss of $6 million in Q1 2025, a reversal from a $10 million pre-tax income in Q1 202410 HG Global HG Global's gross written premiums declined 25% to $7 million due to lower primary market activity, yet pre-tax income surged to $25 million, driven by a $10 million net investment gain HG Global Key Metrics (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Gross Written Premiums | $7 million | $9 million | | Pre-tax Income | $25 million | $6 million | | Net Investment Gains (Losses) | $10 million | $(7) million | - The decrease in gross written premiums was driven by lower primary market activity, though this was partially offset by increased secondary market volume13 Kudu Kudu reported strong results with pre-tax income increasing to $53 million, driven by $44 million in investment gains, and Adjusted EBITDA growing to $16 million, with annualized adjusted EBITDA rising 7% to $65 million Kudu Key Metrics (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total Revenues | $64 million | $11 million | | Pre-tax Income | $53 million | $2 million | | Adjusted EBITDA | $16 million | $14 million | | Net Investment Gains (Losses) | $44 million | $(7) million | - On a trailing 12-month basis, return on equity increased to 13% and annualized adjusted EBITDA increased by 7% to $65 million15 Bamboo Bamboo achieved exceptional Q1 2025 growth, doubling commission and fee revenues to $44 million and tripling MGA adjusted EBITDA to $20 million, with wildfire losses well-contained by reinsurance Bamboo Key Metrics (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Commission & Fee Revenues | $44 million | $22 million | | Pre-tax Income | $6 million | $1 million | | MGA Adjusted EBITDA | $20 million | $6 million | | Managed Premiums | $147 million | $90 million | - Estimated losses from the January 2025 California wildfires total approximately $160 million, the bulk of which will be absorbed by reinsurance partners18 - Trailing 12 months managed premiums increased 96% year-over-year to $542 million19 MediaAlpha White Mountains's investment in MediaAlpha was a significant Q1 2025 headwind, as the investee's share price fell 18%, resulting in a $37 million unrealized loss and reducing the carrying value to $165 million - As of March 31, 2025, White Mountains owned a 27% basic interest in MediaAlpha20 MediaAlpha Investment Value | Date | Share Price | WTM Carrying Value | | :--- | :--- | :--- | | Dec 31, 2024 | $11.29 | $202 million | | Mar 31, 2025 | $9.24 | $165 million | - Each $1.00 change in MediaAlpha's share price results in an approximate $7.00 change in White Mountains's book value per share20 Other Operations The Other Operations segment reported a $59 million pre-tax loss, primarily due to a $37 million unrealized loss from the MediaAlpha investment, while general and administrative expenses declined to $36 million Other Operations Performance (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Pre-tax Income (Loss) | $(59) million | $202 million | | Unrealized Gains (Losses) from MediaAlpha | $(37) million | $211 million | | General & Administrative Expenses | $36 million | $50 million | Consolidated Financial Statements Condensed Consolidated Balance Sheets As of March 31, 2025, total assets increased to $11.0 billion, total liabilities rose to $5.9 billion, and total equity remained relatively stable at $5.1 billion Key Balance Sheet Items (in millions) | Item | March 31, 2025 | December 31, 2024 | March 31, 2024 | | :--- | :--- | :--- | :--- | | Total Investments | $6,547.3 | $6,477.6 | $6,328.1 | | Total Assets | $11,004.9 | $9,925.6 | $9,590.3 | | Total Liabilities | $5,865.2 | $4,794.6 | $4,699.7 | | Total Equity | $5,139.7 | $5,131.0 | $4,890.6 | Condensed Consolidated Statements of Operations In Q1 2025, total revenues decreased to $577.8 million while total expenses rose to $505.4 million, leading to a significant decline in net income attributable to common shareholders to $33.9 million Q1 Statement of Operations Summary (in millions) | Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $577.8 | $647.3 | | Total Expenses | $505.4 | $414.7 | | Pre-tax Income | $72.4 | $232.6 | | Net Income (to Common Shareholders) | $33.9 | $236.4 | Condensed Consolidated Statements of Comprehensive Income Comprehensive income attributable to common shareholders for Q1 2025 was $35.1 million, a substantial decrease from Q1 2024, primarily due to lower net income impacted by investment performance Q1 Comprehensive Income (in millions) | Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income (to Common Shareholders) | $33.9 | $236.4 | | Comprehensive Income (to Common Shareholders) | $35.1 | $236.2 | Non-GAAP Financial Measures & Reconciliations The company uses non-GAAP measures like Adjusted EBITDA for Kudu and Bamboo to clarify underlying operational performance by excluding non-cash and volatile items, and also presents portfolio returns excluding MediaAlpha's impact Kudu Non-GAAP Reconciliation Kudu's non-GAAP metrics, including Adjusted EBITDA, are reconciled from GAAP net income, with Q1 2025 Adjusted EBITDA at $15.8 million, primarily adjusted for investment gains/losses - Adjusted EBITDA is a non-GAAP measure that excludes items such as net realized and unrealized investment gains/losses, non-cash equity-based compensation, and transaction expenses from GAAP net income5660 Kudu Reconciliation: GAAP Pre-tax Income to Adjusted EBITDA (Q1 2025, in millions) | Metric | Amount | | :--- | :--- | | GAAP pre-tax income | $53.4 | | Add: Interest expense | $6.4 | | Add: Income tax expense | $11.6 | | Add: Amortization | $0.1 | | EBITDA | $59.9 | | Exclude: Net investment gains | $(44.0) | | Exclude: Transaction expenses | $(0.1) | | Adjusted EBITDA | $15.8 | Bamboo Non-GAAP Reconciliation Bamboo's performance is presented using non-GAAP MGA Adjusted EBITDA, which isolates the managing general agent business, showing a significant increase to $19.9 million in Q1 2025 - MGA non-GAAP measures, such as MGA pre-tax income and MGA Adjusted EBITDA, exclude the results of the Bamboo captive to better evaluate the performance of the MGA business59 Bamboo Reconciliation: GAAP Pre-tax Income to MGA Adjusted EBITDA (Q1 2025, in millions) | Metric | Amount | | :--- | :--- | | GAAP pre-tax income | $6.3 | | Exclude: Net income, Bamboo captive | $3.9 | | MGA Net Income | $5.8 | | Add: Interest, Taxes, D&A, etc. | ... | | MGA Adjusted EBITDA | $19.9 | Portfolio Return Excluding MediaAlpha To clarify core investment performance, the company presents portfolio returns excluding MediaAlpha's impact, showing a total consolidated return of 2.3% for Q1 2025 compared to the reported 1.7% Reconciliation of Total Consolidated Portfolio Return (Q1) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total consolidated portfolio return | 1.7% | 4.6% | | Remove MediaAlpha impact | 0.6% | (3.4)% | | Total return excluding MediaAlpha | 2.3% | 1.2% |
White Mountains Insurance(WTM) - 2025 Q1 - Quarterly Results