OXRE(OXBR) - 2024 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Net premiums earned for Q3 2024 were $595,000, up from$549,000 in Q3 2023, with total net premiums for the first nine months of 2024 reaching $1.7 million compared to$730,000 in the same period last year [15][19] - Total revenues for Q3 2024 were $205,000, a significant improvement from negative$6.38 million in Q3 2023, while total revenue for the first nine months of 2024 was $124,000 compared to negative$5.1 million in the same period last year [17][18] - The net loss for Q3 2024 was $548,000 or$0.9 per share, an improvement from a net loss of $10.3 million or$1.24 per share in Q3 2023 [19] - The combined ratio decreased from 125.3% in Q3 2023 to 83.7% in Q3 2024, indicating improved underwriting performance [23] Business Line Data and Key Metrics Changes - The company specializes in underwriting low-frequency, high-severity risks, maintaining a loss ratio of 0% for both 2024 and 2023, with no losses incurred [20] - The acquisition cost ratio increased marginally to 11.1% for Q3 2024 from 10.9% in Q3 2023, while the expense ratio decreased significantly from 125.3% in Q3 2023 to 83.7% in Q3 2024 [21][22] Market Data and Key Metrics Changes - The investment portfolio decreased to $185,000 at September 30, 2024, from$680,000 at the prior year-end, primarily due to the sale of equity securities [25] - Cash and cash equivalents increased to $4.82 million at September 30, 2024, compared to$3.74 million on December 31, 2023 [25] Company Strategy and Development Direction - The company aims to position itself as a prominent player in the RWA/Web3 sector, having established SurancePlus Inc. to focus on tokenized reinsurance securities [11][14] - SurancePlus aims to democratize access to reinsurance investments, leveraging blockchain technology for transparency and compliance [12][28] - A strategic review process has been initiated to explore various strategic alternatives for the company and its Web3 division, including potential mergers or divestitures [29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the long-term outlook of the core reinsurance business and the integration of SurancePlus into the RWA market [14][33] - The anticipated growth in the tokenized asset market is projected to exceed $10 trillion over the next decade, with significant institutional interest in blockchain technology [34][35] Other Important Information - The company recorded an unrealized loss of$1.93 million on other investments due to the remeasurement of its investment in Jet.AI [16] - SurancePlus completed a private placement raising approximately $2.9 million through the issuance of digital tokens [29] Q&A Session Summary Question: How are presentations abroad being received and who are the competitors? - Management reported positive reception at various events, highlighting the uniqueness of their RWA offerings compared to competitors [37][38] Question: Can you name any competitors? - Management refrained from naming specific competitors but emphasized their distinct position in the market due to transparency and regulatory compliance [39][40] Question: What is the immediate market reaction to the earnings report? - The immediate market reaction was positive, with stock prices showing an increase following the earnings report [41]