ProAssurance Q3 Earnings Miss Estimates on Weak Specialty P&C Unit

Core Insights - ProAssurance Corporation (PRA) reported weaker third-quarter 2025 results, with shares dipping marginally due to poor underwriting performance, declining gross premiums written, and elevated expenses [1][2][5] - The company experienced a significant drop in adjusted operating income and net income, while investment income showed strong growth [2][4][9] Financial Performance - Adjusted operating income was 15 cents per share, missing the Zacks Consensus Estimate by 46.4% and down 53.1% year over year [2][9] - Operating revenues totaled $274 million, a decrease of 1.4% year over year, and missed the consensus mark by 0.7% [2] - Gross premiums written fell 5.7% year over year to $290.4 million, below the estimate of $301.9 million [3][9] - Net premiums earned decreased 4% year over year to $233.4 million, surpassing the Zacks Consensus Estimate but missing the internal estimate [3] Investment Income and Expenses - Net investment income increased 8.5% year over year to $40.4 million, exceeding both the consensus and internal estimates [4] - Total expenses rose 4.2% year over year to $275.2 million, driven by higher net losses and operating costs, surpassing internal estimates [4] Segment Performance - Specialty P&C Segment revenues declined 4.4% year over year to $181.8 million, missing estimates [6] - Workers' Compensation Insurance Segment revenues fell 2.3% year over year to $41.4 million, also missing estimates [8] - Segregated Portfolio Cell Reinsurance Segment saw gross premiums written improve 4.2% year over year to $14.2 million, with a profit increase of 66.5% [11][12] Financial Position - As of September 30, 2025, cash and cash equivalents were $54.5 million, down 0.8% from the end of 2024 [14] - Total investments reached $4.4 billion, up 1.6% from the previous year [14] - Total shareholders' equity increased 8.5% to $1.3 billion, with book value per share growing 8% to $25.37 [15] Share Repurchase Update - ProAssurance did not repurchase any common shares in the third quarter of 2025, with a remaining capacity of $55.9 million for future repurchases or debt retirement [16]