Core Insights - American Coastal Insurance Corporation (ACIC) reported financial results for Q1 2025, showing a net income of $21.3 million, or $0.43 per diluted share, down from $23.6 million, or $0.48 per diluted share in Q1 2024 [18][44] - The company achieved a combined ratio of 65% and a return on equity exceeding 30% in the first quarter of 2025, indicating strong operational performance despite a decrease in net income [5][8] Financial Performance - Gross premiums written increased by $13.3 million, or 7.2%, to $197.9 million in Q1 2025 from $184.6 million in Q1 2024 [19][44] - Net premiums earned rose by 9% to $68.3 million compared to $62.6 million in the same period last year [2][18] - Total revenue for Q1 2025 was $72.2 million, an increase of 8.4% from $66.6 million in Q1 2024 [2][44] Expense Analysis - Policy acquisition costs surged by $13.9 million, or 144.8%, to $23.5 million in Q1 2025, primarily due to a decrease in ceding commission income [23][44] - General and administrative expenses decreased by $1.8 million, or 15.9%, to $9.5 million, attributed to a non-recurring tax credit refund [24][44] Loss Ratios - Loss and loss adjustment expenses (LAE) decreased by $1.1 million, or 8.8%, to $11.4 million, with the loss ratio as a percentage of net earned premiums dropping to 16.7% from 19.9% [22][44] - The underlying loss and LAE ratio for Q1 2025 was 8.4%, an increase of 0.8 points from 7.6% in Q1 2024 [22][44] Investment Portfolio - The company's cash and investment holdings rose from $540.8 million at the end of 2024 to $568.8 million by March 31, 2025, driven by positive cash flows from operations [26] - Fixed maturities represented approximately 84.3% of total investments as of March 31, 2025, compared to 82.3% at the end of 2024 [26] Book Value - Book value per common share increased by 10.4% from $4.89 at the end of 2024 to $5.40 at March 31, 2025, driven by retained earnings from net income [27][29] - Underlying book value per common share rose by 8.8% from $5.21 to $5.67 during the same period [27][29] Discontinued Operations - The company completed the sale of its subsidiary, Interboro Insurance Company, for approximately $26.5 million, which closed on April 1, 2025 [41]
American Coastal Insurance Corporation Reports Financial Results for its First Quarter Ended March 31, 2025