Ambac(US:AMBC)2025-05-13 13:32Financial Data and Key Metrics Changes - Ambac generated $318 million in premium, up 70%, and $63 million in revenue, up 27% from the prior year [6][12] - The net loss from continuing operations was $16 million or $0.58 per share, compared to a loss of $4 million or $0.09 per share in the same quarter last year [12] - Adjusted EBITDA from continuing operations was a loss of $1 million compared to a slight profit in the first quarter of 2024 [13] Business Line Data and Key Metrics Changes - The distribution business segment, Serata, generated over $230 million in premium for the quarter, up 156% [6] - Everspan's gross premiums written were approximately $87 million, down 10% from the prior year [10] - Dorado revenue increased by 129% to $41 million, driven primarily by the acquisition of B Capital [14] Market Data and Key Metrics Changes - Organic growth, excluding the Beat acquisition, contracted by 2%, but would have been almost 12% without the pullback in ESL and short-term medical business [7] - Everspan's loss ratio improved to 66.9% from 75.7% in the prior year [15] - The combined ratio for Everspan was 102.1%, up from 98.4% last year [16] Company Strategy and Development Direction - The company aims to maintain profitable underwriting results and expand its specialty P&C business, focusing on organic and inorganic growth [8][17] - Ambac plans to generate $80 million to $90 million of adjusted EBITDA for common shareholders by 2028 [18] - The company is enhancing risk capacity, product expansion, and distribution to drive synergies across its platform [9] Management's Comments on Operating Environment and Future Outlook - Management believes market conditions are stabilizing and turning favorable for growth despite challenges in ESL [8] - The company is focused on building a long-term business model that resonates in the specialty MGA and delegated authority program space [17] - Management sees significant opportunities for staffing growth and attracting top talent in the current market [20] Other Important Information - The OCI approval process for the sale of the legacy business is ongoing, which is expected to transform Ambac into a pure play specialty P&C insurance business [11] - The increase in total expenses was driven by a $21 million increase in general and administrative expenses related to the acquisition of Beat [13] Q&A Session Summary Question: Importance of staffing to top line growth and market conditions for recruiting - Management emphasized that staffing is crucial for individual MGAs and that there are significant opportunities for staffing growth due to the attractiveness of their business model [20][21] Question: Update on property versus casualty mix and growth outlook - Management indicated that liability will be the primary source of growth, while property remains attractive despite softening prices [22][23] Question: Comments on the competitive environment - Management acknowledged growing competition but believes their unique business model and capacity relationships allow them to attract top talent [25]