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James River Announces Second Quarter 2024 Results

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James River Group Holdings, (NASDAQ: JRVR) reported second quarter 2024 results. Key highlights include:

  • Net income from continuing operations of $11.9 million ($0.31 per diluted share)
  • Adjusted net operating income of $12.7 million ($0.33 per diluted share)
  • Group combined ratio of 99.3%
  • E&S segment combined ratio of 95.4% with 9.1% positive renewal rate change
  • Specialty Admitted Insurance segment combined ratio of 85.0%
  • Net investment income increased 36.7% year-over-year
  • Shareholders' equity per share increased 0.8% to $14.32

The company continues to focus on de-risking and generating attractive returns on capital. The Board of Directors is exploring strategic alternatives for the company.

James River Group Holdings, (NASDAQ: JRVR) ha riportato i risultati del secondo trimestre 2024. I punti salienti includono:

  • Un reddito netto da operazioni continuative di 11,9 milioni di dollari (0,31 dollari per azione diluita)
  • Un reddito operativo netto rettificato di 12,7 milioni di dollari (0,33 dollari per azione diluita)
  • Un ratio combinato del gruppo di 99,3%
  • Un ratio combinato del segmento E&S di 95,4% con un cambiamento del tasso di rinnovo positivo del 9,1%
  • Un ratio combinato del segmento Assicurazione Specializzata Ammessa di 85,0%
  • Il reddito netto da investimenti è aumentato del 36,7% rispetto all'anno precedente
  • Il patrimonio netto per azione degli azionisti è aumentato dello 0,8% a 14,32 dollari

L'azienda continua a concentrarsi sulla riduzione del rischio e sulla generazione di rendimenti interessanti sul capitale. Il Consiglio di Amministrazione sta esplorando alternative strategiche per l'azienda.

James River Group Holdings, (NASDAQ: JRVR) reportó resultados del segundo trimestre de 2024. Los aspectos destacados incluyen:

  • Ingreso neto de operaciones continuas de 11,9 millones de dólares (0,31 dólares por acción diluida)
  • Ingreso operativo neto ajustado de 12,7 millones de dólares (0,33 dólares por acción diluida)
  • Ratio combinado del grupo de 99,3%
  • Ratio combinado del segmento E&S de 95,4% con un cambio de tasa de renovación positiva del 9,1%
  • Ratio combinado del segmento de seguros por especialidad admitidos de 85,0%
  • El ingreso neto de inversiones aumentó 36,7% en comparación con el año anterior
  • El capital contable por acción aumentó un 0,8% a 14,32 dólares

La empresa sigue enfocándose en reducir el riesgo y generar rendimientos atractivos sobre el capital. La Junta de Directores está explorando alternativas estratégicas para la empresa.

제임스 리버 그룹 홀딩스, (NASDAQ: JRVR)는 2024년 2분기 실적을 보고했습니다. 주요 하이라이트는 다음과 같습니다:

  • 지속 운영으로 인한 순이익 1,190만 달러 (희석주당 0.31 달러)
  • 조정된 운영 순이익 1,270만 달러 (희석주당 0.33 달러)
  • 그룹 결합 비율 99.3%
  • E&S 부문 결합 비율 95.4%, 갱신 비율 변화 9.1% 긍정적
  • 전문 보험 승인 부문 결합 비율 85.0%
  • 순 투자 수익이 전년 대비 36.7% 증가
  • 주당 주주 지분이 0.8% 증가하여 14.32 달러

회사는 리스크 감소와 자본에 대한 매력적인 수익 창출에 집중하고 있습니다. 이사회는 회사를 위한 전략적 대안을 탐색하고 있습니다.

James River Group Holdings, (NASDAQ: JRVR) a rapporté les résultats du deuxième trimestre 2024. Les points clés incluent :

  • Bénéfice net des opérations continues de 11,9 millions de dollars (0,31 dollar par action diluée)
  • Bénéfice net opérationnel ajusté de 12,7 millions de dollars (0,33 dollar par action diluée)
  • Ratio combiné du groupe de 99,3%
  • Ratio combiné du segment E&S de 95,4% avec un changement positif du taux de renouvellement de 9,1%
  • Ratio combiné du segment d'assurance spécialisée admise de 85,0%
  • Le revenu net des investissements a augmenté de 36,7% par rapport à l'année précédente
  • Les capitaux propres par action ont augmenté de 0,8% pour atteindre 14,32 dollars

L'entreprise continue de se concentrer sur la réduction des risques et sur la génération de rendements attractifs sur le capital. Le conseil d'administration explore des alternatives stratégiques pour l'entreprise.

James River Group Holdings, (NASDAQ: JRVR) hat die Ergebnisse für das zweite Quartal 2024 bekannt gegeben. Die wichtigsten Punkte sind:

  • Nettoergebnis aus fortgeführten Betrieben von 11,9 Millionen USD (0,31 USD je verwässerter Aktie)
  • Bereinigtes operatives Nettoergebnis von 12,7 Millionen USD (0,33 USD je verwässerter Aktie)
  • Kombinierte Quote der Gruppe von 99,3%
  • Kombinierte Quote des E&S-Segments von 95,4% mit einer positiven Veränderung der Erneuerungsquote von 9,1%
  • Kombinierte Quote des Segments für Spezialversicherungen von 85,0%
  • Der Nettoertrag aus Anlagen stieg um 36,7% im Vergleich zum Vorjahr
  • Das Eigenkapital pro Aktie stieg um 0,8% auf 14,32 USD

Das Unternehmen konzentriert sich weiterhin auf die Risikominderung und die Erzielung attraktiver Kapitalrenditen. Der Vorstand prüft strategische Alternativen für das Unternehmen.

Positive
  • Net income from continuing operations increased to $11.9 million from $9.5 million year-over-year
  • Adjusted net operating income rose to $12.7 million from $6.6 million year-over-year
  • E&S segment reported positive renewal rate change of 9.1%
  • Specialty Admitted Insurance segment combined ratio improved to 85.0%
  • Net investment income increased 36.7% compared to the prior year quarter
  • Shareholders' equity per share increased 0.8% sequentially to $14.32
Negative
  • Group combined ratio of 99.3% indicates near break-even underwriting performance
  • Net written premium decreased by 11% year-over-year to $181.4 million
  • Net earned premium declined by 6% year-over-year to $163.2 million
  • E&S segment reported $10.7 million of unfavorable reserve development
  • Gross written premium for the Specialty Admitted Insurance segment declined 12.8% year-over-year
  • Net realized and unrealized losses on investments of $2.3 million compared to gains of $1.6 million in the prior year quarter

Insights

James River's Q2 2024 results show mixed performance. The company reported $11.9 million in net income from continuing operations ($0.31 per diluted share), up from $9.5 million in Q2 2023. However, overall net income available to shareholders decreased to $5 million from $13.3 million due to losses from discontinued operations.

Key positives include a strong investment income growth of 36.7% year-over-year and an improved group combined ratio of 99.3%. The E&S segment saw positive renewal rate changes of 9.1%, indicating pricing power. However, gross written premiums declined by 3% overall, with the Specialty Admitted Insurance segment seeing a 13% drop.

The company's strategic shift, including the sale of JRG Re and exploration of strategic alternatives, suggests ongoing efforts to optimize operations. Investors should monitor the impact of the recent E&S LPT and ADC transaction, which is expected to result in a $44 million pre-tax income reduction in Q3 2024.

James River's Q2 results reflect the challenging market conditions in the insurance industry. The E&S segment's combined ratio of 95.4% and Specialty Admitted Insurance segment's 85.0% are commendable, indicating disciplined underwriting. The 9.1% positive renewal rate change in E&S is particularly noteworthy, suggesting strong market positioning.

However, the 27.9% decline in excess property gross written premiums highlights increased competition and capacity in that area. The company's strategic decision to remain selective in this portfolio is prudent given the market dynamics.

The $10.7 million unfavorable reserve development in the E&S segment, primarily from 2017-2020 accident years, warrants attention. While partially covered by the E&S LPT and ADC, it underscores the importance of robust reserving practices in long-tail lines. The upcoming recognition of the E&S LPT and ADC in Q3 2024 will be a significant event to watch for its impact on financial statements and future underwriting strategy.

PEMBROKE, Bermuda, Aug. 05, 2024 (GLOBE NEWSWIRE) -- James River Group Holdings, Ltd. ("James River" or the "Company") (NASDAQ: JRVR) today reported the following results for the second quarter 2024 as compared to the same period in 2023:

 Three Months Ended
June 30,
 Three Months Ended
June 30,
($ in thousands, except for share data) 2024  per diluted
share
  2023 per diluted
share
Net income from continuing operations available to common shareholders$11,853  $0.31  $9,504 $0.25
Net (loss) income from discontinued operations (6,853) $(0.18)  3,785 $0.10
Net income available to common shareholders 5,000  $0.13   13,289 $0.35
Adjusted net operating income1 12,664  $0.33   6,647 $0.18
              

The Company closed the sale of JRG Reinsurance Company Ltd. ("JRG Re") on April 16, 2024. The full financials for our former Casualty Reinsurance segment have been reclassified to discontinued operations for all periods.

Net income from continuing operations available to common shareholders was $11.9 million ($0.31 per diluted share). Adjusted net operating income1 of $12.7 million ($0.33 per diluted share) for the second quarter of 2024 reflected strong investment income and profitable underwriting results from continuing operations.

Unless specified otherwise, all underwriting performance ratios presented herein are for our continuing operations and business not subject to retroactive reinsurance accounting for loss portfolio transfers ("LPTs").

Second Quarter 2024 Highlights:

  • Group combined ratio of 99.3% and adjusted net operating return on tangible common equity1 of 14.9%.
  • E&S segment combined ratio of 95.4% and positive renewal rate change of 9.1%, with the majority of the underwriting divisions reporting positive pricing increases.
  • Specialty Admitted Insurance segment combined ratio of 85.0%, with fronting and program gross written premium growth of 12.3% excluding the non-renewed workers' compensation program.
  • Net investment income increased 36.7% compared to the prior year quarter, with all asset classes reporting higher income.
  • Shareholders' equity per share of $14.32 increased 0.8%2 sequentially from March 31, 2024, due to strong net income from continuing operations, while tangible common equity per share1 increased 0.2%2 sequentially.

Frank D'Orazio, the Company’s Chief Executive Officer, commented on the second quarter, “James River has continued to execute on its strategic priorities of de-risking the organization and generating attractive returns on our capital. E&S market conditions remain favorable amid accelerating submission growth and a strong rate environment during the second quarter as we continue to re-profile segments of our portfolio. While we executed an attractive retroactive reinsurance transaction last month, our Board of Directors continues its exploration of strategic alternatives for the Company that was announced in November of 2023.”

_____________________
1
Adjusted net operating income, tangible common equity per share and adjusted net operating return on tangible common equity are non-GAAP financial measures. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” at the end of this press release.
2 Percent change before $0.05 common dividends paid per share during the second quarter of 2024.

Second Quarter 2024 Operating Results

  • Gross written premium of $412.2 million, consisting of the following:
 Three Months Ended
June 30,
 
($ in thousands) 2024  2023 % Change
Excess and Surplus Lines$292,836 $286,126 2%
Specialty Admitted Insurance 119,411  136,924 (13)%
 $412,247 $423,050 (3)%


  • Net written premium of $181.4 million, consisting of the following:
 Three Months Ended
June 30,
 
($ in thousands) 2024  2023 % Change
Excess and Surplus Lines$161,601 $175,377 (8)%
Specialty Admitted Insurance 19,752  29,116 (32)%
 $181,353 $204,493 (11)%

  • Net earned premium of $163.2 million, consisting of the following:
 Three Months Ended
June 30,
 
($ in thousands) 2024  2023 % Change
Excess and Surplus Lines$140,447 $149,611 (6)%
Specialty Admitted Insurance 22,746  23,858 (5)%
 $163,193 $173,469 (6)%

  • E&S Segment Highlights:
    • For the second quarter of 2024, our casualty underwriting divisions grew 5.3% compared to the prior year quarter, led by general casualty at 14.6%.
    • Renewal rate increases across the segment were 9.1% during the quarter.
    • Amid moderating rate increases, more readily available capacity and increased competition, we are remaining selective in our excess property portfolio, resulting in a gross written premium decline of 27.9% in that line of business.
    • Across the E&S segment, gross written premium increased 2.3% compared to the prior year quarter as most casualty underwriting divisions reported stable growth rates and continued strong submission flows.
    • As mentioned previously, premium retention in the segment was lower than the prior year quarter due to the impact of a restructured casualty reinsurance treaty put in place for the segment at mid year 2023, driving the decline in net written premium.
  • Specialty Admitted Insurance Segment Highlights:
    • Gross written premium for fronting and program business increased 12.3% compared to the prior year quarter excluding the impact of our large workers' compensation program that was non-renewed during the second quarter of 2023.
    • Gross written premium for the Specialty Admitted Insurance segment declined 12.8% compared to the second quarter of 2023, with the reduction due to the impact of the non-renewed workers' compensation program and the sale of the renewal rights of the individual risk workers' compensation business during the third quarter of 2023.
  • Pre-tax favorable (unfavorable) reserve development by segment on business not subject to retroactive reinsurance accounting for loss portfolio transfers was as follows:
 Three Months Ended
June 30,
($ in thousands) 2024   2023 
Excess and Surplus Lines$(10,662) $(118)
Specialty Admitted Insurance 4   839 
 $(10,658) $721 
  • The second quarter of 2024 reflected $10.7 million of unfavorable reserve development in the E&S segment and minimal reserve movements in the Specialty Admitted Insurance segment. Reserve development in the E&S segment was primarily related to accident years 2017-2020 for the general liability and excess casualty lines of business. $9.7 million of the unfavorable reserve development in the E&S segment is subject to the previously disclosed combined loss portfolio transfer and adverse development cover reinsurance transaction ("E&S LPT and ADC"). The E&S LPT and ADC is effective January 1, 2024, but closed on July 2, 2024. As such, any applicable recoveries will be recognized in the third quarter of 2024.
  • Additionally, the Company recognized unfavorable reserve development of $1.4 million on the reserves subject to the Commercial Auto LPT, which provides unlimited coverage. Retroactive benefits of $5.1 million were recorded in loss and loss adjustment expenses during the second quarter and the deferred retroactive reinsurance gain on the Balance Sheet is $13.0 million as of June 30, 2024.
  • Gross fee income was as follows:
 Three Months Ended
June 30,
 
($ in thousands) 2024  2023 % Change
Specialty Admitted Insurance$5,565 $5,800 (4)%
  • The consolidated expense ratio was 26.3% for the second quarter of 2024, which was an improvement from 28.2% in the prior year quarter. The expense ratio benefited from favorable commission expense adjustments in the Specialty Admitted Insurance segment.

Investment Results

Net investment income for the second quarter of 2024 was $24.9 million, an increase of 36.7% compared to $18.2 million in the prior year quarter. Growth in income was broad-based across the portfolio, as cash flow was deployed at higher yields. On a sequential basis, income from private investments and all other investments increased.

The Company’s net investment income consisted of the following:

 Three Months Ended
June 30,
 
($ in thousands) 2024  2023 % Change
Private Investments 1,909  232 723%
All Other Investments 23,022  18,002 28%
Total Net Investment Income$24,931 $18,234 37%
         

The Company’s annualized gross investment yield on average fixed maturity, bank loan and equity securities for the three months ended June 30, 2024 was 5.0% (versus 4.3% for the three months ended June 30, 2023). The investment yield increased primarily as a result of higher market yields on fixed maturity securities and bank loans.

Net realized and unrealized losses on investments of $2.3 million for the three months ended June 30, 2024 compared to net realized and unrealized gains on investments of $1.6 million in the prior year quarter. The majority of the realized and unrealized losses during the second quarter of 2024 were related to sales in our fixed income portfolio and changes in fair values of our common stock and bank loan portfolios.

In connection with the closing of the E&S LPT and ADC, the Company transferred approximately $310.0 million in cash for the payment of the premium to counterparty State National Insurance Company, Inc.

Taxes

The Company's effective tax rate fluctuates from period to period based on the relative mix of income reported by country and the respective tax rates imposed by each tax jurisdiction. The effective tax rate on income from continuing operations for the six months ended June 30, 2024 was 28.5%.

Tangible Equity

Tangible equity3 of $485.3 million at June 30, 2024 decreased 0.3% compared to tangible equity of $486.6 million at March 31, 2024, as strong income from continuing operations was partially offset by a loss from discontinued operations and modest unrealized investment losses in accumulated other comprehensive income ("AOCI"). AOCI declined by $2.4 million during the second quarter of 2024 to a loss of $73.9 million, due to a decrease in the value of the Company's fixed maturity securities caused by an increase in interest rates. Excluding AOCI, tangible common equity3 increased 0.2% sequentially.

_____________________
3 Tangible equity and tangible common equity excluding AOCI are non-GAAP financial measures. See “Non-GAAP Financial Measures” and “Reconciliation of Non-GAAP Financial Measures” at the end of this press release.

Capital Management

The Company announced that its Board of Directors declared a cash dividend of $0.05 per common share. This dividend is payable on Monday, September 30, 2024 to all shareholders of record on Monday, September 16, 2024.

Other

As referenced previously, the E&S LPT and ADC is effective January 1, 2024, but closed on July 2, 2024. As such, any applicable recoveries will be recognized beginning in the third quarter of 2024.

As a result of the E&S LPT and ADC, the Company expects to recognize a reduction in pre-tax income of approximately $44.0 million in the third quarter of 2024.

Conference Call

James River will hold a conference call to discuss its second quarter results tomorrow, August 6, 2024 at 8:30 a.m. Eastern Time. Investors may access the conference call by dialing (800) 715-9871, Conference ID 8370409, or via the internet by visiting www.jrvrgroup.com and clicking on the “Investor Relations” link. A webcast replay of the call will be available by visiting the company website.

Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. In some cases, such forward-looking statements may be identified by terms such as believe, expect, seek, may, will, should, intend, project, anticipate, plan, estimate, guidance or similar words. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Although it is not possible to identify all of these risks and uncertainties, they include, among others, the following: the inherent uncertainty of estimating reserves and the possibility that incurred losses may be greater than our loss and loss adjustment expense reserves; inaccurate estimates and judgments in our risk management may expose us to greater risks than intended; downgrades in the financial strength rating of our regulated insurance subsidiaries impacting our ability to attract and retain insurance business that our subsidiaries write, our competitive position, and our financial condition; uncertainty regarding the outcome and timing of our exploration of strategic alternatives, and the impacts that it may have on our business; the amount of the final post-closing adjustment to the purchase price received in connection with the sale of our casualty reinsurance business; the potential loss of key members of our management team or key employees and our ability to attract and retain personnel; adverse economic factors resulting in the sale of fewer policies than expected or an increase in the frequency or severity of claims, or both; the impact of a persistently high inflationary environment on our reserves, the values of our investments and investment returns, and our compensation expenses; exposure to credit risk, interest rate risk and other market risk in our investment portfolio; reliance on a select group of brokers and agents for a significant portion of our business and the impact of our potential failure to maintain such relationships; reliance on a select group of customers for a significant portion of our business and the impact of our potential failure to maintain, or decision to terminate, such relationships; our ability to obtain reinsurance coverage at prices and on terms that allow us to transfer risk, adequately protect our company against financial loss and that supports our growth plans; losses resulting from reinsurance counterparties failing to pay us on reinsurance claims, insurance companies with whom we have a fronting arrangement failing to pay us for claims, or a former customer with whom we have an indemnification arrangement failing to perform its reimbursement obligations, and our potential inability to demand or maintain adequate collateral to mitigate such risks; inadequacy of premiums we charge to compensate us for our losses incurred; changes in laws or government regulation, including tax or insurance law and regulations; changes in U.S. tax laws and the interpretation of certain provisions of Public Law No. 115-97, informally titled the 2017 Tax Cuts and Jobs Act (including associated regulations), which may be retroactive and could have a significant effect on us including, among other things, by potentially increasing our tax rate, as well as on our shareholders; in the event we do not qualify for the insurance company exception to the passive foreign investment company (“PFIC”) rules and are therefore considered a PFIC, there could be material adverse tax consequences to an investor that is subject to U.S. federal income taxation; the Company or its foreign subsidiary becoming subject to U.S. federal income taxation; a failure of any of the loss limitations or exclusions we utilize to shield us from unanticipated financial losses or legal exposures, or other liabilities; losses from catastrophic events, such as natural disasters and terrorist acts, which substantially exceed our expectations and/or exceed the amount of reinsurance we have purchased to protect us from such events; potential effects on our business of emerging claim and coverage issues; the potential impact of internal or external fraud, operational errors, systems malfunctions or cyber security incidents; our ability to manage our growth effectively; failure to maintain effective internal controls in accordance with the Sarbanes-Oxley Act of 2002, as amended; changes in our financial condition, regulations or other factors that may restrict our subsidiaries’ ability to pay us dividends; and an adverse result in any litigation or legal proceedings we are or may become subject to. Additional information about these risks and uncertainties, as well as others that may cause actual results to differ materially from those in the forward-looking statements, is contained in our filings with the U.S. Securities and Exchange Commission ("SEC"), including our most recently filed Annual Report on Form 10-K and Quarterly Report on 10-Q. These forward-looking statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

Non-GAAP Financial Measures

In presenting James River Group Holdings, Ltd.’s results, management has included financial measures that are not calculated under standards or rules that comprise accounting principles generally accepted in the United States (“GAAP”). Such measures, including underwriting profit (loss), adjusted net operating income, tangible equity, tangible common equity, adjusted net operating return on tangible equity (which is calculated as annualized adjusted net operating income divided by the average quarterly tangible equity balances in the respective period), and adjusted net operating return on tangible common equity excluding AOCI (which is calculated as annualized adjusted net operating income divided by the average quarterly tangible common equity balances in the respective period, excluding AOCI), are referred to as non-GAAP measures. These non-GAAP measures may be defined or calculated differently by other companies. These measures should not be viewed as a substitute for those measures determined in accordance with GAAP. Reconciliations of such measures to the most comparable GAAP figures are included at the end of this press release.

About James River Group Holdings, Ltd.

James River Group Holdings, Ltd. is a Bermuda-based insurance holding company that owns and operates a group of specialty insurance companies. The Company operates in two specialty property-casualty insurance segments: Excess and Surplus Lines and Specialty Admitted Insurance. Each of the Company’s regulated insurance subsidiaries are rated “A-” (Excellent) by A.M. Best Company.

Visit James River Group Holdings, Ltd. on the web at www.jrvrgroup.com

 
James River Group Holdings, Ltd. and Subsidiaries
Condensed Consolidated Balance Sheet Data (Unaudited)
 
($ in thousands, except for share data) June 30,
2024
 December 31,
2023
ASSETS   
Invested assets:   
Fixed maturity securities, available-for-sale, at fair value$1,114,475 $1,324,476
Equity securities, at fair value 128,564  119,945
Bank loan participations, at fair value 165,280  156,169
Short-term investments 45,977  72,137
Other invested assets 35,834  33,134
Total invested assets 1,490,130  1,705,861
    
Cash and cash equivalents 672,523  274,298
Restricted cash equivalents (a) 27,963  72,449
Accrued investment income 9,850  12,106
Premiums receivable and agents’ balances, net 248,995  249,490
Reinsurance recoverable on unpaid losses, net 1,417,791  1,358,474
Reinsurance recoverable on paid losses 160,555  157,991
Deferred policy acquisition costs 27,150  31,497
Goodwill and intangible assets 214,462  214,644
Other assets 468,787  457,047
Assets of discontinued operations held-for-sale 0  783,393
Total assets$4,738,206 $5,317,250
    
LIABILITIES AND SHAREHOLDERS’ EQUITY   
Reserve for losses and loss adjustment expenses$2,720,198 $2,606,107
Unearned premiums 600,603  587,899
Funds held (a) 25,157  65,235
Deferred reinsurance gain 13,047  20,733
Senior debt 200,800  222,300
Junior subordinated debt 104,055  104,055
Accrued expenses 47,769  56,722
Other liabilities 339,888  333,183
Liabilities of discontinued operations held-for-sale 0  641,497
Total liabilities 4,051,517  4,637,731
    
Series A redeemable preferred shares 144,898  144,898
Total shareholders’ equity 541,791  534,621
Total liabilities, Series A redeemable preferred shares, and shareholders’ equity$4,738,206 $5,317,250
    
Tangible equity (b)$485,274 $485,608
Tangible equity per share (b)$10.86 $11.13
Tangible common equity per share (b)$9.00 $9.05
Shareholders' equity per share$14.32 $14.20
Common shares outstanding 37,825,767  37,641,563
    
(a) Restricted cash equivalents and the funds held liability includes funds posted by the Company to a trust account for the benefit of a third party administrator handling the claims on the Rasier commercial auto policies in run-off. Such funds held in trust secure the Company's obligations to reimburse the administrator for claims payments, and are primarily sourced from the collateral posted to the Company by Rasier and its affiliates to support their obligations under the indemnity agreements and the loss portfolio transfer reinsurance agreement with the Company.
(b) See “Reconciliation of Non-GAAP Measures”   


 
James River Group Holdings, Ltd. and Subsidiaries
Condensed Consolidated Income Statement Data (Unaudited)
 
 Three Months Ended
June 30,
 Six Months Ended
June 30,
($ in thousands, except for share data)2024 2023 2024 2023
REVENUES       
Gross written premiums$412,247  $423,050  $743,057  $776,504 
Net written premiums 181,353   204,493   319,525   375,718 
        
Net earned premiums 163,193   173,469   334,884   342,379 
Net investment income 24,931   18,234   47,563   36,659 
Net realized and unrealized (losses) gains on investments (2,305)  1,615   2,278   1,775 
Other income 2,470   1,464   4,691   2,773 
Total revenues 188,289   194,782   389,416   383,586 
        
EXPENSES       
Losses and loss adjustment expenses (a) 115,471   120,440   225,520   246,821 
Other operating expenses 44,096   50,193   94,906   98,229 
Other expenses 2,098   223   2,830   826 
Interest expense 6,344   5,997   12,829   11,580 
Intangible asset amortization and impairment 91   91   182   182 
Total expenses 168,100   176,944   336,267   357,638 
Income from continuing operations before income taxes 20,189   17,838   53,149   25,948 
Income tax expense on continuing operations 5,711   5,709   15,163   8,517 
Net income from continuing operations 14,478   12,129   37,986   17,431 
Net (loss) income from discontinued operations (6,853)  3,785   (14,958)  5,489 
NET INCOME 7,625   15,914   23,028   22,920 
Dividends on Series A preferred shares (2,625)  (2,625)  (5,250)  (5,250)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS$5,000  $13,289  $17,778  $17,670 
ADJUSTED NET OPERATING INCOME (b)$12,664  $6,647  $27,496  $19,016 
        
INCOME (LOSS) PER COMMON SHARE       
Basic       
Continuing operations$0.31  $0.25  $0.87  $0.32 
Discontinued operations$(0.18) $0.10  $(0.40) $0.15 
 $0.13  $0.35  $0.47  $0.47 
Diluted (c)       
Continuing operations$0.31  $0.25  $0.85  $0.32 
Discontinued operations$(0.18) $0.10  $(0.33) $0.15 
 $0.13  $0.35  $0.52  $0.47 
        
ADJUSTED NET OPERATING INCOME PER COMMON SHARE    
Basic$0.33  $0.18  $0.73  $0.51 
Diluted$0.33  $0.18  $0.72  $0.50 
        
Weighted-average common shares outstanding:       
Basic 37,869,322   37,642,289   37,801,516   37,587,359 
Diluted 38,037,393   37,858,747   44,762,563   37,822,405 
Cash dividends declared per common share$0.05  $0.05  $0.10  $0.10 
        
Ratios:       
Loss ratio 73.0%  70.7%  69.6%  69.3%
Expense ratio (d) 26.3%  28.2%  27.6%  28.0%
Combined ratio 99.3%  98.9%  97.2%  97.3%
Accident year loss ratio (e) 66.0%  67.5%  66.3%  67.3%
        
(a) Losses and loss adjustment expenses include benefits of $3.7 million and $7.7 million for deferred retroactive reinsurance gains for the three and six months ended June 30, 2024, respectively ($2.3 million of benefit and $9.4 million of expense in the respective prior year periods).
(b) See "Reconciliation of Non-GAAP Measures".
(c) The outstanding Series A preferred shares were dilutive for the six months ended June 30, 2024. Dividends on the Series A preferred shares were added back to the numerator in the calculation and 6,799,665 common shares from an assumed conversion of the Series A preferred shares were included in the denominator for the six month calculation.
(d) Calculated with a numerator comprising other operating expenses less gross fee income (in specific instances when the Company is not retaining insurance risk) included in “Other income” in our Condensed Consolidated Income Statements of $1.3 million and $2.6 million for the three and six months ended June 30, 2024, respectively ($1.3 million and $2.4 million in the respective prior year periods).
(e) Ratio of losses and loss adjustment expenses for the current accident year, excluding development on prior accident year reserves, to net earned premiums for the current year (excluding net earned premium adjustments on certain reinsurance treaties with reinstatement premiums associated with prior years).


  
James River Group Holdings, Ltd. and Subsidiaries
Segment Results
 
  
EXCESS AND SURPLUS LINES 
  
 Three Months Ended
June 30,
   Six Months Ended
June 30,
   
($ in thousands)2024
 2023
 %
Change
 2024
 2023
 %
Change
 
Gross written premiums$292,836  $286,126  2.3% $506,527  $515,029  (1.7)%
Net written premiums$161,601  $175,377  (7.9)% $279,026  $319,877  (12.8)%
             
Net earned premiums$140,447  $149,611  (6.1)% $286,070  $298,040  (4.0)%
Losses and loss adjustment expenses excluding retroactive reinsurance (101,533)  (105,098) (3.4)%  (195,138)  (204,287) (4.5)%
Underwriting expenses (32,487)  (34,471) (5.8)%  (66,014)  (66,646) (0.9)%
Underwriting profit (a)$6,427  $10,042  (36.0)% $24,918  $27,107  (8.1)%
             
Ratios:            
Loss ratio 72.3%  70.2%    68.2%  68.5%   
Expense ratio 23.1%  23.1%    23.1%  22.4%   
Combined ratio 95.4%  93.3%    91.3%  90.9%   
Accident year loss ratio (b) 64.2%  66.0%    64.2%  65.9%   
             
(a) See "Reconciliation of Non-GAAP Measures". 
(b) Ratio of losses and loss adjustment expenses for the current accident year, excluding development on prior accident year reserves, to net earned premiums for the current year (excluding net earned premium adjustments on certain reinsurance treaties with reinstatement premiums associated with prior years).


 
SPECIALTY ADMITTED INSURANCE
 
 Three Months Ended
June 30,
   Six Months Ended
June 30,
  
($ in thousands)2024 2023 %
Change
 2024 2023 %
Change
Gross written premiums$119,411  $136,924  (12.8)% $236,530  $261,475  (9.5)%
Net written premiums$19,752  $29,116  (32.2)% $40,499  $55,841  (27.5)%
            
Net earned premiums$22,746  $23,858  (4.7)% $48,814  $44,339  10.1%
Losses and loss adjustment expenses (17,622)  (17,594) 0.2%  (38,068)  (33,086) 15.1%
Underwriting expenses (1,708)  (5,880) (71.0)%  (6,544)  (11,338) (42.3)%
Underwriting profit (loss) (a), (b)$3,416  $384  789.6% $4,202  $(85)  
            
Ratios:           
Loss ratio 77.5%  73.7%    78.0%  74.6%  
Expense ratio 7.5%  24.7%    13.4%  25.6%  
Combined ratio 85.0%  98.4%    91.4%  100.2%  
Accident year loss ratio 77.5%  77.3%    78.9%  76.9%  
            
(a) See "Reconciliation of Non-GAAP Measures".
(b) Underwriting results for the three and six months ended June 30, 2024 include gross fee income of $5.6 million and $10.9 million, respectively ($5.8 million and $11.5 million in the respective prior year periods).
 

Underwriting Performance Ratios

The following table provides the underwriting performance ratios of the Company's continuing operations inclusive of the business subject to retroactive reinsurance accounting for a loss portfolio transfer. There is no economic impact to the Company over the life of a loss portfolio transfer contract so long as any additional losses subject to the contract are within the limit of the loss portfolio transfer and the counterparty performs under the contract. Retroactive reinsurance accounting is not indicative of our current and ongoing operations. Management believes that providing loss ratios and combined ratios on business not subject to retroactive reinsurance accounting for loss portfolio transfers gives the users of our financial statements useful information in evaluating our current and ongoing operations.

 Three Months Ended
June 30,
 Six Months Ended
June 30,
 2024 2023 2024 2023
Excess and Surplus Lines:       
Loss Ratio72.3% 70.2% 68.2% 68.5%
Impact of retroactive reinsurance(2.6)% (1.5)% (2.7)% 3.2%
Loss Ratio including impact of retroactive reinsurance69.7% 68.7% 65.5% 71.7%
        
Combined Ratio95.4% 93.3% 91.3% 90.9%
Impact of retroactive reinsurance(2.6)% (1.5)% (2.7)% 3.2%
Combined Ratio including impact of retroactive reinsurance92.8% 91.8% 88.6% 94.1%
        
Consolidated:       
Loss Ratio73.0% 70.7% 69.6% 69.3%
Impact of retroactive reinsurance(2.3)% (1.3)% (2.3)% 2.8%
Loss Ratio including impact of retroactive reinsurance70.7% 69.4% 67.3% 72.1%
        
Combined Ratio99.3% 98.9% 97.2% 97.3%
Impact of retroactive reinsurance(2.3)% (1.3)% (2.3)% 2.8%
Combined Ratio including impact of retroactive reinsurance97.0% 97.6% 94.9% 100.1%
            

RECONCILIATION OF NON-GAAP MEASURES

Underwriting Profit

The following table reconciles the underwriting profit by individual operating segment and for the entire Company to consolidated income from continuing operations before taxes. We believe that the disclosure of underwriting profit by individual segment and of the Company as a whole is useful to investors, analysts, rating agencies and other users of our financial information in evaluating our performance because our objective is to consistently earn underwriting profits. We evaluate the performance of our segments and allocate resources based primarily on underwriting profit. We define underwriting profit as net earned premiums and gross fee income (in specific instances when the Company is not retaining insurance risk) less losses and loss adjustment expenses on business from continuing operations not subject to retroactive reinsurance accounting for loss portfolio transfers and other operating expenses. Other operating expenses include the underwriting, acquisition, and insurance expenses of the operating segments and, for consolidated underwriting profit, the expenses of the Corporate and Other segment. Our definition of underwriting profit may not be comparable to that of other companies.

 Three Months Ended
June 30,
 Six Months Ended
June 30,
($ in thousands)2024 2023 2024 2023
Underwriting profit (loss) of the operating segments:       
Excess and Surplus Lines$6,427  $10,042  $24,918  $27,107 
Specialty Admitted Insurance 3,416   384   4,202   (85)
Total underwriting profit of operating segments 9,843   10,426   29,120   27,022 
Other operating expenses of the Corporate and Other segment (8,624)  (8,548)  (19,761)  (17,830)
Underwriting profit (a) 1,219   1,878   9,359   9,192 
Losses and loss adjustment expenses - retroactive reinsurance 3,684   2,252   7,686   (9,448)
Net investment income 24,931   18,234   47,563   36,659 
Net realized and unrealized (losses) gains on investments (2,305)  1,615   2,278   1,775 
Other income (expense) (905)  (53)  (726)  (468)
Interest expense (6,344)  (5,997)  (12,829)  (11,580)
Amortization of intangible assets (91)  (91)  (182)  (182)
Income from continuing operations before taxes$20,189  $17,838  $53,149  $25,948 
        
(a) Included in underwriting results for the three and six months ended June 30, 2024 is gross fee income of $5.6 million and $10.9 million, respectively ($5.8 million and $11.5 million in the respective prior year periods).
 

Adjusted Net Operating Income

We define adjusted net operating income as income available to common shareholders excluding a) income (loss) from discontinued operations b) the impact of retroactive reinsurance accounting for a loss portfolio transfer, c) net realized and unrealized gains (losses) on investments, d) certain non-operating expenses such as professional service fees related to various strategic initiatives, and the filing of registration statements for the offering of securities, and e) severance costs associated with terminated employees. We use adjusted net operating income as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted net operating income should not be viewed as a substitute for net income calculated in accordance with GAAP, and our definition of adjusted net operating income may not be comparable to that of other companies.

Our income available to common shareholders reconciles to our adjusted net operating income as follows:

 Three Months Ended June 30,
 2024 2023
($ in thousands)Income
Before
Taxes
 Net
Income
 Income
Before
Taxes
 Net
Income
Income available to common shareholders$10,711  $5,000  $18,998  $13,289 
Loss (income) from discontinued operations 6,853   6,853   (3,785)  (3,785)
Losses and loss adjustment expenses - retroactive reinsurance (3,684)  (2,910)  (2,252)  (1,779)
Net realized and unrealized investment losses (gains) 2,305   1,821   (1,615)  (1,276)
Other expenses 2,098   1,900   223   198 
Adjusted net operating income$18,283  $12,664  $11,569  $6,647 
        
 Six Months Ended June 30,
 2024 2023
($ in thousands)Income
Before
Taxes
 Net
Income
 Income
Before
Taxes
 Net
Income
Income available to common shareholders$32,941  $17,778  $26,187  $17,670 
Loss (income) from discontinued operations 14,958   14,958   (5,489)  (5,489)
Losses and loss adjustment expenses - retroactive reinsurance (7,686)  (6,072)  9,448   7,464 
Net realized and unrealized investment gains (2,278)  (1,800)  (1,775)  (1,402)
Other expenses 2,830   2,632   798   773 
Adjusted net operating income$40,765  $27,496  $29,169  $19,016 
                

Tangible Equity (per Share) and Tangible Common Equity (per Share)

We define tangible equity as shareholders' equity plus mezzanine Series A preferred shares and the unrecognized deferred retroactive reinsurance gain on loss portfolio transfers less goodwill and intangible assets (net of amortization). We define tangible common equity as tangible equity less mezzanine Series A preferred shares. Our definition of tangible equity and tangible common equity may not be comparable to that of other companies, and it should not be viewed as a substitute for shareholders’ equity calculated in accordance with GAAP. We use tangible equity and tangible common equity internally to evaluate the strength of our balance sheet and to compare returns relative to this measure. The following table reconciles shareholders’ equity to tangible equity and tangible common equity for June 30, 2024, March 31, 2024, December 31, 2023, and June 30, 2023.

 June 30,
2024
 March 31,
2024
 December 31,
2023
 June 30,
2023
($ in thousands, except for share data)       
Shareholders' equity$541,791 $539,537 $534,621 $585,542
Plus: Series A redeemable preferred shares 144,898  144,898  144,898  144,898
Plus: Deferred reinsurance gain (a) 13,047  16,731  20,733  37,572
Less: Goodwill and intangible assets 214,462  214,553  214,644  217,325
Tangible equity$485,274 $486,613 $485,608 $550,687
Less: Series A redeemable preferred shares 144,898  144,898  144,898  144,898
Tangible common equity$340,376 $341,715 $340,710 $405,789
        
Common shares outstanding 37,825,767  37,822,340  37,641,563  37,619,226
Common shares from assumed conversion of Series A preferred shares 6,848,763  6,750,567  5,971,184  5,640,158
Common shares outstanding after assumed conversion of Series A preferred shares 44,674,530  44,572,907  43,612,747  43,259,384
        
Equity per share:       
Shareholders' equity$14.32 $14.27 $14.20 $15.56
Tangible equity$10.86 $10.92 $11.13 $12.73
Tangible common equity$9.00 $9.03 $9.05 $10.79
        
(a) Deferred reinsurance gain for the periods ending March 31, 2024 and December 31, 2023 excludes the deferred retroactive reinsurance gain of $34.0 million and $33.2 million, respectively, related to the former Casualty Reinsurance LPT in discontinued operations.



FAQ

What was James River's net income from continuing operations in Q2 2024?

James River reported net income from continuing operations of $11.9 million ($0.31 per diluted share) in the second quarter of 2024.

How did James River's E&S segment perform in Q2 2024?

The E&S segment reported a combined ratio of 95.4% and a positive renewal rate change of 9.1% in Q2 2024.

What was the change in James River's net investment income for Q2 2024?

James River's net investment income increased by 36.7% compared to the same quarter in the previous year.

Did James River (JRVR) declare a dividend for Q2 2024?

Yes, James River declared a cash dividend of $0.05 per common share, payable on September 30, 2024, to shareholders of record on September 16, 2024.

What was James River's (JRVR) shareholders' equity per share as of Q2 2024?

James River's shareholders' equity per share was $14.32 as of Q2 2024, representing a 0.8% increase from the previous quarter.

James River Group Holdings, Ltd

NASDAQ:JRVR

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236.81M
37.83M
3.21%
84.43%
3.26%
Insurance - Specialty
Fire, Marine & Casualty Insurance
Link
United States of America
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