ProAssurance Q1 Earnings Miss Estimates on Declining Premiums

Core Viewpoint - ProAssurance Corporation reported weaker-than-expected first-quarter 2025 results, primarily due to lower premiums in the Specialty P&C segment and Segregated Portfolio Cell Reinsurance unit, although rising investment income and reduced expenses provided some offset [1][2]. Financial Performance - Adjusted operating income for Q1 2025 was 13 cents per share, missing the Zacks Consensus Estimate of 19 cents, but an increase from 6 cents in the prior year [2]. - Operating revenues decreased by 4.3% year over year to $269.8 million, slightly below the consensus mark by 0.3% [2]. - Gross premiums written were $303.8 million, down 2.4% year over year, with net premiums earned falling 3.2% to $236.3 million, missing the consensus estimate of $244.2 million [3]. Investment Income and Expenses - Net investment income rose by 9% year over year to $37 million, exceeding the consensus estimate of $36.9 million [4]. - Total expenses decreased by 0.3% year over year to $278.4 million, although this was higher than the estimate of $265.4 million [4]. Segment Performance - Specialty P&C segment revenues declined by 2.1% year over year to $187 million, but exceeded the Zacks Consensus Estimate of $182.2 million [5]. - Workers' Compensation Insurance segment revenues increased by 0.8% year over year to $41.9 million, surpassing the consensus estimate of $41.8 million [7]. - Segregated Portfolio Cell Reinsurance segment gross premiums written fell by 20% year over year to $12.7 million, missing the estimate of $13.9 million [9]. Financial Position - As of March 31, 2025, ProAssurance had cash and cash equivalents of $43.5 million, down from $54.9 million at the end of 2024 [12]. - Total investments increased by 0.5% to $4.4 billion, while total assets decreased to $5.5 billion from $5.6 billion at the end of 2024 [12]. - Total shareholders' equity rose by 2.6% to $1.2 billion, with book value per share increasing to $24.05 from $23.49 [13]. Share Repurchase Update - No common shares were repurchased in the first quarter of 2025, with a remaining capacity of $55.9 million available for future repurchases or debt retirement [14].