High-ROE quarter for American Coastal (NASDAQ: ACIC) even as premiums fall
Rhea-AI Filing Summary
American Coastal Insurance Corporation reported solid profitability for the first quarter ended March 31, 2026, while navigating a softer commercial property market. Net income from continuing operations was $19.3 million, compared with $19.7 million a year earlier, and diluted earnings per share from continuing operations were $0.39 versus $0.40.
Total revenue was $71.2 million, down slightly from $72.2 million, as gross premiums written fell to $149.4 million from $197.9 million, a 24.5% decline driven by increased competition and lower pricing. Despite this, the combined ratio remained favorable at 66.0%, with an underlying combined ratio of 68.3%, both broadly consistent with last year.
Core income was $19.3 million, or $0.39 per diluted share, down from $20.7 million, or $0.42, reflecting lower premiums and the absence of prior-year discontinued operations. Return on equity based on GAAP net income was a robust 24.5%, while book value per share rose to $6.86, up 27.1% from $5.40 a year earlier and 5.4% from December 31, 2025.
Positive
- None.
Negative
- None.
Insights
Profitability and book value growth remain strong despite a sharp premium decline.
American Coastal generated Q1 2026 net income from continuing operations of $19.3 million and a combined ratio of 66.0%, even as gross premiums written fell 24.5% to $149.4 million. This indicates the commercial property book is still earning attractive margins in a softer pricing environment.
Core income of $19.3 million and core return on equity of 24.6% show that underlying profitability remains high, though modestly lower year-over-year. Management attributes premium contraction to competitive pressure and a roughly 24% decline in net pricing, reflecting deliberate underwriting discipline rather than loss of control.
Book value per share increased to $6.86 at March 31, 2026, up 27.1% from a year earlier, with underlying book value at $7.04. Investors can track future quarters to see whether the company maintains a combined ratio near the 66–68% range as pricing and reinsurance costs evolve.
8-K Event Classification
Key Figures
Key Terms
combined ratio financial
core income financial
underlying combined ratio financial
Accumulated Other Comprehensive Income financial
core return on equity financial
Earnings Snapshot
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): |
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(Address of Principal Executive Offices) |
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Registrant’s Telephone Number, Including Area Code: |
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Trading |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On May 5, 2026, American Coastal Insurance Corporation (the Company, we, our) issued a press release relating to our earnings for the first quarter ended March 31, 2026 (the Earnings Release). We have attached a copy of the Earnings Release as Exhibit 99.1.
Item 7.01 Regulation FD Disclosure.
The executive officers of the Company intend to use the materials filed herewith, in whole or in part, in one or more meetings with investors and analysts, beginning on May 5, 2026. A copy of the Earnings presentation is attached hereto as Exhibit 99.2.
The information furnished under this Item 2.02 and 7.01, including Exhibit 99.1 and Exhibit 99.2 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference to such filing.
Item 9.01 Financial Statements and Exhibits.
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Exhibit No. |
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Description |
99.1 |
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Earnings release issued by the Company on May 5, 2026 |
99.2 |
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Earnings presentation issued by the Company on May 5, 2026 |
104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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AMERICAN COASTAL INSURANCE CORPORATION |
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Date: |
May 5, 2026 |
By: |
/s/ B. Bradford Martz |
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B. Bradford Martz, President & Chief Executive Officer |
Exhibit 99.1
FOR IMMEDIATE RELEASE
AMERICAN COASTAL INSURANCE CORPORATION REPORTS FINANCIAL RESULTS
FOR ITS FIRST QUARTER ENDED MARCH 31, 2026
Company to Host Quarterly Conference Call at 5:00 P.M. ET on May 5, 2026
The information in this press release should be read in conjunction with an earnings presentation that is available on the Company's website at investors.amcoastal.com/events-and-presentations.
St. Petersburg, FL - May 5, 2026: American Coastal Insurance Corporation (Nasdaq: ACIC) ("ACIC" or the "Company"), a property and casualty insurance holding company, today reported its financial results for the first quarter ended March 31, 2026.
($ in thousands, except for per share data) |
Three Months Ended March 31, |
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2026 |
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2025 |
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Change |
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Gross premiums written |
$ |
149,395 |
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$ |
197,852 |
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(24.5 |
)% |
Gross premiums earned |
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141,134 |
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162,101 |
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(12.9 |
)% |
Net premiums earned |
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65,611 |
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68,272 |
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(3.9 |
)% |
Total revenue |
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71,224 |
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72,202 |
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(1.4 |
)% |
Income from continuing operations, net of tax |
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19,254 |
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19,711 |
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(2.3 |
)% |
Income from discontinued operations, net of tax |
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— |
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1,637 |
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NM |
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Consolidated net income |
$ |
19,254 |
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$ |
21,348 |
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(9.8 |
)% |
Net income available to ACIC stockholders per diluted share |
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Continuing Operations |
$ |
0.39 |
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$ |
0.40 |
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(2.5 |
)% |
Discontinued Operations |
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— |
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0.03 |
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NM |
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Total |
$ |
0.39 |
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$ |
0.43 |
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(9.3 |
)% |
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Reconciliation of net income to core income: |
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Plus: Non-cash amortization of intangible assets |
$ |
610 |
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$ |
609 |
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0.2 |
% |
Less: Income from discontinued operations, net of tax |
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— |
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1,637 |
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NM |
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Less: Net realized gains on investment portfolio |
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6 |
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1,382 |
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(99.6 |
)% |
Less: Unrealized gains (losses) on equity securities |
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528 |
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(1,963 |
) |
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NM |
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Less: Net tax impact (1) |
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16 |
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250 |
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(93.6 |
)% |
Core income(2) |
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19,314 |
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20,651 |
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(6.5 |
)% |
Core income per diluted share (2) |
$ |
0.39 |
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$ |
0.42 |
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(7.1 |
)% |
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Book value per share |
$ |
6.86 |
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$ |
5.40 |
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27.1 |
% |
NM = Not Meaningful
(1) In order to reconcile net income to the core income measures, the Company included the tax impact of all adjustments using the 21% federal corporate tax rate.
(2) Core income and core income per diluted share, both of which are measures that are not based on generally accepted accounting principles ("GAAP"), are reconciled above to net income and net income per diluted share, respectively, the most directly comparable GAAP measures. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.
1
Exhibit 99.1
Comments from President & Chief Executive Officer, B. Bradford Martz:
“I’m pleased to report another profitable quarter for American Coastal. Our 66.0% combined ratio and 68.3% underlying combined ratio remain in line with our targets. More importantly, these ratios were consistent year-over-year, leading us to consistent earnings throughout the market cycle.
While the commercial market continues through a soft cycle, periods like these create opportunities for carriers with discipline, patience, and a long-term view of value creation. We are being deliberate about where and how we deploy capital through selective partnerships, targeted classes of commercial property business, and leaning into AI in ways that will strengthen our competitive position without compromising underwriting standards. Our focus remains on building value through specialization, talent, and prudent risk selection so that American Coastal can successfully navigate a very dynamic marketplace.”
Return on Equity and Core Return on Equity
The calculations of the Company's return on equity and core return on equity are shown below.
($ in thousands) |
Three Months Ended March 31, |
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2026 |
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2025 |
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Income from continuing operations, net of tax |
$ |
19,254 |
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$ |
19,711 |
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Return on equity based on GAAP income from continuing operations, net of tax (1) |
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24.5 |
% |
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32.7 |
% |
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Income from discontinued operations, net of tax |
$ |
— |
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$ |
1,637 |
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Return on equity based on GAAP income from discontinued operations, net of tax (1) |
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— |
% |
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2.7 |
% |
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Consolidated net income |
$ |
19,254 |
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$ |
21,348 |
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Return on equity based on GAAP net income (1) |
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24.5 |
% |
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35.4 |
% |
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Core income |
$ |
19,314 |
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$ |
20,651 |
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Core return on equity (1)(2) |
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24.6 |
% |
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34.2 |
% |
(1) Return on equity for the three months ended March 31, 2026 and 2025 is calculated on an annualized basis by dividing the net income or core income for the period by the average stockholders' equity for the trailing twelve months.
(2) Core return on equity, a measure that is not based on GAAP, is calculated based on core income, which is reconciled on the first page of this press release to net income, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.
2
Exhibit 99.1
Combined Ratio and Underlying Ratio
The calculations of the Company's combined ratio and underlying combined ratio are shown below.
($ in thousands) |
Three Months Ended |
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2026 |
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2025 |
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Change |
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Loss ratio, net(1) |
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15.6 |
% |
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16.7 |
% |
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(1.1 |
) |
pts |
Expense ratio, net(2) |
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50.4 |
% |
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48.3 |
% |
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2.1 |
|
pts |
Combined ratio (CR)(3) |
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66.0 |
% |
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|
65.0 |
% |
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|
1.0 |
|
pts |
Effect of current year catastrophe losses on CR |
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0.2 |
% |
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|
— |
% |
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0.2 |
|
pts |
Effect of prior year favorable development on CR |
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(2.5 |
)% |
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(3.2 |
)% |
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0.7 |
|
pts |
Underlying combined ratio(4) |
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68.3 |
% |
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68.2 |
% |
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0.1 |
|
pts |
(1) Loss ratio, net, is calculated as losses and loss adjustment expenses ("LAE"), net of losses ceded to reinsurers, relative to net premiums earned.
(2) Expense ratio, net, is calculated as the sum of all operating expenses, less interest expense relative to net premiums earned.
(3) Combined ratio is the sum of the loss ratio, net, and expense ratio, net.
(4) Underlying combined ratio, a measure that is not based on GAAP, is reconciled above to the combined ratio, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.
Combined Ratio Analysis
The calculations of the Company's loss ratios and underlying loss ratios are shown below.
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Three Months Ended March 31, |
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2026 |
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2025 |
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Change |
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Net loss and LAE |
$ |
10,243 |
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$ |
11,389 |
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$ |
(1,146 |
) |
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% of Gross earned premiums |
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7.3 |
% |
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7.0 |
% |
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0.3 |
|
pts |
% of Net earned premiums |
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15.6 |
% |
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16.7 |
% |
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(1.1 |
) |
pts |
Less: |
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Current year catastrophe losses |
$ |
114 |
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|
$ |
— |
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$ |
114 |
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Prior year reserve favorable development |
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(1,666 |
) |
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(2,194 |
) |
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|
528 |
|
|
Underlying loss and LAE (1) |
$ |
11,795 |
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$ |
13,583 |
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$ |
(1,788 |
) |
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% of Gross earned premiums |
|
8.4 |
% |
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|
8.4 |
% |
|
|
— |
|
pts |
% of Net earned premiums |
|
18.0 |
% |
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19.9 |
% |
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(1.9 |
) |
pts |
(1) Underlying loss and LAE is a non-GAAP financial measure and is reconciled above to loss and LAE, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section, below.
The calculations of the Company's expense ratios are shown below.
|
Three Months Ended March 31, |
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|
2026 |
|
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2025 |
|
|
Change |
|||||
Policy acquisition costs |
$ |
22,393 |
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|
$ |
23,466 |
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$ |
(1,073 |
) |
|
General and administrative |
|
10,703 |
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|
9,506 |
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|
1,197 |
|
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Total operating expenses |
$ |
33,096 |
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|
$ |
32,972 |
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|
$ |
124 |
|
|
% of Gross earned premiums |
|
23.5 |
% |
|
|
20.3 |
% |
|
|
3.2 |
|
pts |
% of Net earned premiums |
|
50.4 |
% |
|
|
48.3 |
% |
|
|
2.1 |
|
pts |
3
Exhibit 99.1
Quarter to Date Financial Results
Net income for the first quarter ended March 31, 2026 was $19.3 million, or $0.39 per diluted share, compared to net income of $21.3 million, or $0.43 per diluted share, for the first quarter ended March 31, 2025. The primary driver of the change in net income during the first quarter of 2026 was the Company's discontinued operations in 2025 which generated net income of $1.6 million. The Company divested these operations in 2025.
The Company's total gross written premium decreased by $48.5 million, or 24.5%, to $149.4 million for the first quarter ended March 31, 2026, from $197.9 million for the first quarter ended March 31, 2025. Gross premiums earned decreased $21.0 million, or 13.0%, to $141.1 million for the first quarter ended March 31, 2026 from $162.1 million for the first quarter ended March 31, 2025. These changes can be attributed to increased competition and a decrease of 24% in our net pricing year-over-year as the market softens. Ceded premiums earned decreased $18.3 million, or 19.5%, to $75.5 million for the first quarter ended March 31, 2026 from $93.8 million for the first quarter ended March 31, 2025. The breakdown of the quarter-over-quarter changes in these premiums is shown in the table below. More detail regarding the Company's ceded premiums can be seen in the "Reinsurance Costs as a Percentage of Gross Earned Premium" section below.
($ in thousands) |
Three Months Ended March 31, |
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2026 |
|
|
2025 |
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|
Change $ |
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|
Change % |
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||||
Gross premiums written |
$ |
149,395 |
|
|
$ |
197,852 |
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|
$ |
(48,457 |
) |
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(24.5 |
)% |
Change in gross unearned premiums |
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(8,261 |
) |
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(35,751 |
) |
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|
27,490 |
|
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(76.9 |
)% |
Gross premiums earned |
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141,134 |
|
|
|
162,101 |
|
|
|
(20,967 |
) |
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|
(12.9 |
)% |
Ceded premiums written |
|
(56,548 |
) |
|
|
(54,074 |
) |
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(2,474 |
) |
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|
4.6 |
% |
Change in ceded unearned premiums |
|
(18,975 |
) |
|
|
(39,755 |
) |
|
|
20,780 |
|
|
|
(52.3 |
)% |
Ceded premiums earned |
|
(75,523 |
) |
|
|
(93,829 |
) |
|
|
18,306 |
|
|
|
(19.5 |
)% |
Net premiums earned |
$ |
65,611 |
|
|
$ |
68,272 |
|
|
$ |
(2,661 |
) |
|
|
(3.9 |
)% |
Losses and LAE decreased by $1.2 million, or 10.5%, to $10.2 million for the first quarter ended March 31, 2026, from $11.4 million for the first quarter ended March 31, 2025. Loss and LAE expense as a percentage of net earned premiums decreased 1.1 points to 15.6% for the first quarter ended March 31, 2026, compared to 16.7% for the first quarter ended March 31, 2025. Excluding catastrophe losses and reserve development, the Company's gross underlying loss and LAE ratio for the first quarter ended March 31, 2026, would have been 8.4%, or no change from 8.4% for the first quarter ended March 31, 2025.
Policy acquisition costs decreased by $1.1 million, or 4.7%, to $22.4 million for the first quarter ended March 31, 2026, from $23.5 million for the first quarter ended March 31, 2025, primarily due to decreased external management fees as a product of the decrease in gross premiums shown above. This was partially offset by a decrease in ceding commission income as a result of the Company's quota share reinsurance coverage decreasing from 20% to 15%, effective June 1, 2025.
General and administrative expenses increased by $1.2 million, or 12.6%, to $10.7 million for the first quarter ended March 31, 2026, from $9.5 million for the first quarter ended March 31, 2025, driven by increased salary-related expenses, primarily due to a non-recurring employee retention tax credit refund submitted to the Internal Revenue Service in 2022 that was received during the first quarter of 2025, which did not recur in 2026. This change was partially offset by a decrease in amortization, as assets related to the Company's intellectual property transaction with Slide Insurance Company were fully amortized when the transaction came to its conclusion in January 2026. This decrease in amortization corresponds with the decrease seen in other income.
4
Exhibit 99.1
Reinsurance Costs as a Percentage of Gross Earned Premium
Reinsurance costs as a percentage of gross earned premium in the first quarter of 2026 and 2025 were as follows:
|
2026 |
|
|
2025 |
|
||
Non-at-Risk |
|
(0.4 |
)% |
|
|
(0.3 |
)% |
Quota Share |
|
(12.6 |
)% |
|
|
(16.2 |
)% |
All Other |
|
(40.6 |
)% |
|
|
(41.4 |
)% |
Total Ceding Ratio |
|
(53.6 |
)% |
|
|
(57.9 |
)% |
Ceded premiums earned related to the Company's quota share reinsurance coverage decreased as the result of a decrease in the cession rate from 20% to 15% effective June 1, 2025. The Company's excess-of-loss coverage remained relatively flat, with cost savings on these contracts driving a decrease in the Company's ceding ratio as the Company's replacement excess-of-loss coverage was more cost-effective than the quota share coverage it replaced.
Investment Portfolio Highlights
The Company's cash, restricted cash and investment holdings decreased from $647.7 million at December 31, 2025, to $599.4 million at March 31, 2026. The Company paid a dividend totaling approximately $36.6 million during the first quarter, which drove this decrease, along with changes in operating assets and liabilities. The Company's cash and investment holdings consist primarily of investments in U.S. government and agency securities, corporate debt, mutual funds and investment grade money market instruments. Fixed maturities represented approximately 70.5% of total investments at March 31, 2026, compared to 71.3% of total investments at December 31, 2025. The Company's fixed maturity investments had a modified duration of 2.3 years at March 31, 2026, compared to 2.5 years at December 31, 2025.
Book Value Analysis
Book value per common share increased 5.4% from $6.51 at December 31, 2025, to $6.86 at March 31, 2026. Underlying book value per common share increased 5.7% from $6.66 at December 31, 2025, to $7.04 at March 31, 2026. An increase in the
5
Exhibit 99.1
Company's retained earnings as a result of net income for the quarter ended March 31, 2026 drove the increase in the Company's book value per share. As shown in the table below, removing the effect of Accumulated Other Comprehensive Income ("AOCI"), caused by capital market conditions, increases the Company's book value per common share at March 31, 2026.
($ in thousands, except for share and per share data) |
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||
|
March 31, 2026 |
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|
December 31, 2025 |
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Book Value per Share |
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|
|
|
|
||
Numerator: |
|
|
|
|
|
||
Common stockholders' equity |
$ |
331,698 |
|
|
$ |
317,565 |
|
Denominator: |
|
|
|
|
|
||
Total Shares Outstanding |
|
48,342,811 |
|
|
|
48,764,802 |
|
Book Value Per Common Share |
$ |
6.86 |
|
|
$ |
6.51 |
|
|
|
|
|
|
|
||
Book Value per Share, Excluding the Impact of AOCI |
|
|
|
|
|
||
Numerator: |
|
|
|
|
|
||
Common stockholders' equity |
$ |
331,698 |
|
|
$ |
317,565 |
|
Less: Accumulated other comprehensive loss |
|
(8,492 |
) |
|
|
(7,242 |
) |
Stockholders' Equity, excluding AOCI |
$ |
340,190 |
|
|
$ |
324,807 |
|
Denominator: |
|
|
|
|
|
||
Total Shares Outstanding |
|
48,342,811 |
|
|
|
48,764,802 |
|
Underlying Book Value Per Common Share(1) |
$ |
7.04 |
|
|
$ |
6.66 |
|
(1) Underlying book value per common share is a non-GAAP financial measure and is reconciled above to book value per common share, the most directly comparable GAAP measure. Additional information regarding non-GAAP financial measures presented in this press release can be found in the "Definitions of Non-GAAP Measures" section below.
Conference Call Details
Date and Time: May 5, 2026 - 5:00 P.M. ET
Participant Dial-In: (United States): 877-445-9755
(International): 201-493-6744
Webcast: To listen to the live webcast, please go to https://investors.amcoastal.com and click on the conference call link at the bottom of the page or go to: https://event.webcasts.com/starthere.jsp?ei=1757732&tp_key=768fef8242
An archive of the webcast will be available for a limited period of time thereafter.
Presentation: The information in this press release should be read in conjunction with an earnings presentation that is available on the Company's website at investors.amcoastal.com/events-and-presentations.
About American Coastal Insurance Corporation
American Coastal Insurance Corporation (amcoastal.com) is the holding company of the insurance carrier, American Coastal Insurance Company, which was founded in 2007 for the purpose of insuring Condominium and Homeowner Association properties, Apartments and Assisted Living Facilities in the state of Florida. American Coastal Insurance Company has an exclusive partnership for distribution of Condominium Association properties in the state of Florida with AmRisc Group (amriscgroup.com), one of the largest Managing General Agents in the country specializing in hurricane-exposed properties. American Coastal Insurance Company has earned a Financial Stability Rating of “A”, "Exceptional" from Demotech, and maintains an “A-” insurance financial strength rating with a Positive outlook by Kroll. ACIC maintains a ‘BBB-’ issuer rating with a Positive outlook by Kroll.
6
Exhibit 99.1
Contact Information: |
Alexander Baty |
Vice President, Finance & Investor Relations, American Coastal Insurance Corp. |
investorrelations@amcoastal.com |
(727) 425-8076 |
|
Jeremy Hellman |
Investor Relations, Vice President, The Equity Group |
jhellman@equityny.com |
(212) 836-9626 |
Definitions of Non-GAAP Measures
The Company believes that investors' understanding of ACIC's performance is enhanced by the Company's disclosure of the following non-GAAP measures. The Company's methods for calculating these measures may differ from those used by other companies and therefore comparability may be limited.
Net income (loss) excluding the effects of amortization of intangible assets, income (loss) from discontinued operations, realized gains (losses) and unrealized gains (losses) on equity securities, net of tax (core income (loss)) is a non-GAAP measure that is computed by adding amortization, net of tax, to net income (loss) and subtracting income (loss) from discontinued operations, net of tax, realized gains (losses) on the Company's investment portfolio, net of tax, and unrealized gains (losses) on the Company's equity securities, net of tax, from net income (loss). Amortization expense is related to the amortization of intangible assets acquired, including goodwill, through mergers and, therefore, the expense does not arise through normal operations. Investment portfolio gains (losses) and unrealized equity security gains (losses) vary independent of the Company's operations. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is net income (loss). The core income (loss) measure should not be considered a substitute for net income (loss) and does not reflect the overall profitability of the Company's business.
Core return on equity is a non-GAAP ratio calculated using non-GAAP measures. It is calculated by dividing the core income (loss) for the period by the average stockholders’ equity for the trailing twelve months (or one quarter of such average, in the case of quarterly periods). Core income (loss) is an after-tax non-GAAP measure that is calculated by excluding from net income (loss) the effect of income (loss) from discontinued operations, net of tax, non-cash amortization of intangible assets, including goodwill, unrealized gains or losses on the Company's equity security investments and net realized gains or losses on the Company's investment portfolio. In the opinion of the Company’s management, core income (loss), core income (loss) per share and core return on equity are meaningful indicators to investors of the Company's underwriting and operating results, since the excluded items are not necessarily indicative of operating trends. Internally, the Company’s management uses core income (loss), core income (loss) per share and core return on equity to evaluate performance against historical results and establish financial
7
Exhibit 99.1
targets on a consolidated basis. The most directly comparable GAAP measure is return on equity. The core return on equity measure should not be considered a substitute for return on equity and does not reflect the overall profitability of the Company's business.
Combined ratio excluding the effects of current year catastrophe losses and prior year reserve development (underlying combined ratio) is a non-GAAP measure, that is computed by subtracting the effect of current year catastrophe losses and prior year development from the combined ratio. The Company believes that this ratio is useful to investors, and it is used by management to highlight the trends in the Company's business that may be obscured by current year catastrophe losses and prior year development. Current year catastrophe losses cause the Company's loss trends to vary significantly between periods as a result of their frequency of occurrence and severity and can have a significant impact on the combined ratio. Prior year development is caused by unexpected loss development on historical reserves. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is the combined ratio. The underlying combined ratio should not be considered as a substitute for the combined ratio and does not reflect the overall profitability of the Company's business.
Net loss and LAE excluding the effects of current year catastrophe losses and prior year reserve development (underlying loss and LAE) is a non-GAAP measure that is computed by subtracting the effect of current year catastrophe losses and prior year reserve development from net loss and LAE. The Company uses underlying loss and LAE figures to analyze the Company's loss trends that may be impacted by current year catastrophe losses and prior year development on the Company's reserves. As discussed previously, these two items can have a significant impact on the Company's loss trends in a given period. The Company believes it is useful for investors to evaluate these components both separately and in the aggregate when reviewing the Company's performance. The most directly comparable GAAP measure is net loss and LAE. The underlying loss and LAE measure should not be considered a substitute for net loss and LAE and does not reflect the overall profitability of the Company's business.
Book value per common share, excluding the impact of accumulated other comprehensive loss (underlying book value per common share), is a non-GAAP measure that is computed by dividing common stockholders' equity after excluding accumulated other comprehensive income (loss), by total common shares outstanding plus dilutive potential common shares outstanding. The Company uses the trend in book value per common share, excluding the impact of accumulated other comprehensive income (loss), in conjunction with book value per common share to identify and analyze the change in net worth attributable to management efforts between periods. The Company believes this non-GAAP measure is useful to investors because it eliminates the effect of interest rates that can fluctuate significantly from period to period and are generally driven by economic and financial factors that are not influenced by management. Book value per common share is the most directly comparable GAAP measure. Book value per common share, excluding the impact of accumulated other comprehensive income (loss), should not be considered a substitute for book value per common share and does not reflect the recorded net worth of the Company's business.
Discontinued Operations
On May 9, 2024, the Company entered into the Sale Agreement with Forza Insurance Holdings, LLC ("Forza") in which ACIC agreed to sell and Forza agreed to acquire 100% of the issued and outstanding stock of the Company's subsidiary, Interboro Insurance Company ("IIC"). Forza's application to acquire IIC was approved by the New York Department of Financial Services on February 13, 2025 and the sale closed on April 1, 2025. The Company received cash proceeds totaling $25,679,000 from the sale resulting in a loss on disposal of $247,000, net of tax impact. The Company also recognized a $1,348,000 loss, net of tax impact, on IIC's fixed maturity portfolio, which was included in Accumulated other comprehensive loss on the Company's Consolidated Balance Sheet prior to the sale.
Forward-Looking Statements
Statements made in this press release, or on the conference call identified above, and otherwise, that are not historical facts are “forward-looking statements”. The Company believes these statements are based on reasonable estimates, assumptions and
8
Exhibit 99.1
plans. However, if the estimates, assumptions, or plans underlying the forward-looking statements prove inaccurate or if other risks or uncertainties arise, actual results could differ materially from those expressed in, or implied by, the forward-looking statements. These statements are made subject to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements do not relate strictly to historical or current facts and may be identified by their use of words such as “may,” “will,” “expect,” "endeavor," "project," “believe,” "plan," “anticipate,” “intend,” “could,” “would,” “estimate” or “continue” or the negative variations thereof or comparable terminology. Factors that could cause actual results to differ materially may be found in the Company's filings with the U.S. Securities and Exchange Commission, in the “Risk Factors” section in the Company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q. Forward-looking statements speak only as of the date on which they are made, and, except as required by applicable law, the Company undertakes no obligation to update or revise any forward-looking statements.
9
Exhibit 99.1
Consolidated Statements of Comprehensive Income (Unaudited)
In thousands, except share and per share amounts
|
|
Three Months Ended |
|
|||||
|
|
March 31, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
REVENUE: |
|
|
|
|
|
|
||
Gross premiums written |
|
$ |
149,395 |
|
|
$ |
197,852 |
|
Change in gross unearned premiums |
|
|
(8,261 |
) |
|
|
(35,751 |
) |
Gross premiums earned |
|
|
141,134 |
|
|
|
162,101 |
|
Ceded premiums earned |
|
|
(75,523 |
) |
|
|
(93,829 |
) |
Net premiums earned |
|
|
65,611 |
|
|
|
68,272 |
|
Net investment income |
|
|
5,079 |
|
|
|
4,511 |
|
Net realized investment gains |
|
|
6 |
|
|
|
1,382 |
|
Net unrealized gains (losses) on equity securities |
|
|
528 |
|
|
|
(1,963 |
) |
Total revenue |
|
|
71,224 |
|
|
|
72,202 |
|
EXPENSES: |
|
|
|
|
|
|
||
Losses and loss adjustment expenses |
|
|
10,243 |
|
|
|
11,389 |
|
Policy acquisition costs |
|
|
22,393 |
|
|
|
23,466 |
|
General and administrative expenses |
|
|
10,703 |
|
|
|
9,506 |
|
Interest expense |
|
|
2,344 |
|
|
|
2,717 |
|
Total expenses |
|
|
45,683 |
|
|
|
47,078 |
|
Income before other income |
|
|
25,541 |
|
|
|
25,124 |
|
Other income |
|
|
212 |
|
|
|
1,070 |
|
Income before income taxes |
|
|
25,753 |
|
|
|
26,194 |
|
Provision for income taxes |
|
|
6,499 |
|
|
|
6,483 |
|
Income from continuing operations, net of tax |
|
$ |
19,254 |
|
|
$ |
19,711 |
|
Income from discontinued operations, net of tax |
|
|
— |
|
|
|
1,637 |
|
Net income |
|
$ |
19,254 |
|
|
$ |
21,348 |
|
OTHER COMPREHENSIVE INCOME: |
|
|
|
|
|
|
||
Change in net unrealized gains (losses) on investments |
|
|
(1,244 |
) |
|
|
4,212 |
|
Reclassification adjustment for net realized investment gains |
|
|
(6 |
) |
|
|
(1,382 |
) |
Total comprehensive income |
|
$ |
18,004 |
|
|
$ |
24,178 |
|
|
|
|
|
|
|
|
||
Weighted average shares outstanding |
|
|
|
|
|
|
||
Basic |
|
|
48,546,290 |
|
|
|
48,135,231 |
|
Diluted |
|
|
49,808,832 |
|
|
|
49,564,721 |
|
|
|
|
|
|
|
|
||
Earnings available to ACIC common stockholders per share |
|
|
|
|
|
|
||
Basic |
|
|
|
|
|
|
||
Continuing operations |
|
$ |
0.40 |
|
|
$ |
0.41 |
|
Discontinued operations |
|
|
— |
|
|
|
0.03 |
|
Total |
|
$ |
0.40 |
|
|
$ |
0.44 |
|
Diluted |
|
|
|
|
|
|
||
Continuing operations |
|
$ |
0.39 |
|
|
$ |
0.40 |
|
Discontinued operations |
|
|
— |
|
|
|
0.03 |
|
Total |
|
$ |
0.39 |
|
|
$ |
0.43 |
|
|
|
|
|
|
|
|
||
Dividends declared per share |
|
$ |
— |
|
|
$ |
— |
|
10
Exhibit 99.1
Consolidated Balance Sheets (Unaudited)
In thousands, except share amounts
|
|
March 31, |
|
|
December 31, |
|
||
ASSETS |
|
|
|
|
|
|
||
Investments, at fair value: |
|
|
|
|
|
|
||
Fixed maturities, available-for-sale |
|
$ |
254,123 |
|
|
$ |
253,152 |
|
Equity securities |
|
|
64,715 |
|
|
|
61,685 |
|
Other investments |
|
|
41,658 |
|
|
|
40,053 |
|
Total investments |
|
$ |
360,496 |
|
|
$ |
354,890 |
|
Cash and cash equivalents |
|
|
117,013 |
|
|
|
198,762 |
|
Restricted cash |
|
|
121,936 |
|
|
|
94,092 |
|
Total cash, cash equivalents and restricted cash |
|
$ |
238,949 |
|
|
$ |
292,854 |
|
Accrued investment income |
|
|
3,096 |
|
|
|
3,156 |
|
Property and equipment, net |
|
|
691 |
|
|
|
723 |
|
Premiums receivable, net |
|
|
76,719 |
|
|
|
70,447 |
|
Reinsurance recoverable on paid and unpaid losses, net |
|
|
112,057 |
|
|
|
128,205 |
|
Ceded unearned premiums |
|
|
90,722 |
|
|
|
109,697 |
|
Goodwill |
|
|
59,476 |
|
|
|
59,476 |
|
Deferred policy acquisition costs, net |
|
|
39,952 |
|
|
|
37,815 |
|
Intangible assets, net |
|
|
2,861 |
|
|
|
3,471 |
|
Other assets |
|
|
11,987 |
|
|
|
11,998 |
|
Total Assets |
|
$ |
997,006 |
|
|
$ |
1,072,732 |
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
||
Liabilities: |
|
|
|
|
|
|
||
Unpaid losses and loss adjustment expenses |
|
$ |
126,990 |
|
|
$ |
165,701 |
|
Unearned premiums |
|
|
257,878 |
|
|
|
249,616 |
|
Reinsurance payable on premiums |
|
|
42,491 |
|
|
|
66,841 |
|
Accounts payable and accrued expenses |
|
|
80,434 |
|
|
|
112,781 |
|
Operating lease liability |
|
|
3,077 |
|
|
|
3,135 |
|
Notes payable, net |
|
|
149,436 |
|
|
|
149,353 |
|
Other liabilities |
|
|
5,002 |
|
|
|
7,740 |
|
Total Liabilities |
|
$ |
665,308 |
|
|
$ |
755,167 |
|
|
|
|
|
|
|
|
||
Stockholders' Equity: |
|
|
|
|
|
|
||
Preferred stock, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding |
|
$ |
— |
|
|
$ |
— |
|
Common stock, $0.0001 par value; 100,000,000 shares authorized; 48,993,640 and 48,976,885 issued, respectively; 48,342,811 and 48,764,802 outstanding, respectively |
|
|
5 |
|
|
|
5 |
|
Additional paid-in capital |
|
|
440,871 |
|
|
|
439,742 |
|
Treasury shares, at cost: 650,829 shares and 212,083 shares, respectively |
|
|
(5,431 |
) |
|
|
(431 |
) |
Accumulated other comprehensive loss |
|
|
(8,492 |
) |
|
|
(7,242 |
) |
Retained earnings (deficit) |
|
|
(95,255 |
) |
|
|
(114,509 |
) |
Total Stockholders' Equity |
|
$ |
331,698 |
|
|
$ |
317,565 |
|
Total Liabilities and Stockholders' Equity |
|
$ |
997,006 |
|
|
$ |
1,072,732 |
|
11
1st Quarter 2026 May 5, 2026 Earnings Presentation
Company Overview ACIC is a specialty underwriter of catastrophe exposed commercial property insurance. American Coastal Insurance Corp. (Nasdaq: ACIC) is the insurance holding company for American Coastal Insurance Company (AmCoastal), a Florida domiciled P&C carrier, and Skyway Underwriters (SKU), a managing general agency, along with other operating affiliates. AmCoastal is a balance sheet underwriter and has the #1 market share of admitted commercial residential property insurance in Florida with roughly 4,254 policies and $558.9 million of premium in-force. AmCoastal has earned an underwriting profit every year since its inception in 2007. SKU is an MGA focused on producing & underwriting commercial property insurance on behalf of our risk bearing entities. ACIC as of March 31, 2026 Total Assets: $997 million Total Equity: $331.7 million Annualized Revenue: $284.8 million Employees: 65 Headquarters: St. Petersburg, FL Credit Rating: BBB- Specialty Commercial Property Managing General Agency
Executive Summary 1Q-26 Results Non-GAAP Core Income of $19.3m ($0.39) decreased -$1.3m (-7%) from $20.7m ($0.42) y/y due to modest reduction in gross earned premiums as we maintain underwriting discipline in a softening commercial catastrophe property environment. Net premiums earned declined -$2.7m (-3.9%) y/y to $65.6m due to a decrease in gross earned premium offset by lower reinsurance costs resulting in Total Revenue being nearly flat y/y. Our combined ratio of 66.0% increased 1 point from last year due to net rate decreases and our Non-GAAP underlying combined ratio (which excludes current catastrophe losses and PY development) was 68.3% which was nearly identical to last year despite weaker premiums due to exceptionally good loss experience driving a lower loss ratio. We experienced $1.7m of favorable prior year reserve development. Stockholders’ equity increased $14.1 million (+4.5%) from December 31, 2025, to $331.7m or $6.86 per share and $7.04 per share excluding unrealized losses in accumulated other comprehensive income. Tangible book value per share rose 6.7% to $5.57 per share. Other Highlights The Florida commercial property market continued to soften during the quarter with average premiums down -16.6% in March Y/Y. ACES Specialty Insurance Company is still pending approval by Arizona, but AmCoastal assumed $6.2 million in E&S premiums in March as our quota share supporting AmRisc’s E&S commercial property portfolio commenced. We have effectively completed our 6.1.26 Core CAT reinsurance program renewal and achieved very attractive pricing while also broadening our reinsurer panel and improving overall per occurrence and aggregate protection.
1Q-26 Financial Scorecard Earnings and Return on Equity Continue to be Strong in the First Quarter. 1Q-26 = $0.39 vs. Analysts’ Avg Est. = $0.44 1Q-26 = $6.86 vs. Analysts’ Avg Est. = $6.85 1Q-26 = 66.0% vs. Analysts’ Avg Est. = 66.2% 1Q-26 = 24.6% vs. Analysts’ Avg Est. = 26.5% Core Earnings per Share (CEPS) Book Value per Share (BVPS) Combined Ratio (CR) Core Return on Equity (CROE)
1Q-26 Summary of Key Results Earnings and Margins Remained Intact as the Market Continues to Soften.
1Q-26 Operating Overview Revenues are flat YoY as the Market Continues to Soften, but Profitability and Margin Remain Strong. While revenues decreased year-over-year, expenses moved in tandem with this decrease. Excluding a one-time benefit of $1.5 million in Q1 2025, operating expense would have decreased commensurate with our premium decrease. Profitability and margin remain unchanged despite the market cycle.
Balance Sheet Highlights Book value continues to grow, and liquidity remained strong in the first quarter of 2026.
Liquidity and Book Value Trends The Company continues to build its liquidity position and book value through earnings. *2024 - $0.50 special dividend declared *2025 - $0.75 special dividend declared 3-YR CAGR – 35.4% 3-YR CAGR – 40.9%
Investment Portfolio Overview The Company’s high quality fixed income investments provide steady investment income with minimal risk. The Company continues to keep significant cash on hand as yields remain strong and invest funds as the Company’s risk appetite dictates.
Historical Pricing Environment Pricing still above historical mean & with reinsurance costs decreasing, ACIC can earn good margins. Generational Hard Market Normalized ROE Technical Price Level Meaningful Reforms Implemented in FL
Core CAT Program – Effective 6.1.26
Core CAT Placement Progression Significant improvement in costs from 2023 – 2026 while also achieving improved coverage (i.e. all perils, multi-year, cascading coverage).
Excess Per Risk Program – Effective 4.1.26 Structure Illustration Excess Per Risk Program Highlights 4/1/26 Per Risk and Auto FAC Program All Perils Coverage (excludes Named Storm) Retention: $4,250,000 Deposit Premium: $3,812,500 $35m xs $10m Auto FAC Layer Per Building Coverage Increased layer from $25m to $35m Can write ISO 5 & 6 business above $45m of TIV 8 incumbent reinsurers on the Auto FAC panel $5m xs $5m Treaty Layer Per Policy Coverage Added 8 new reinsurers on the treaty layer
Cautionary Statements This presentation and the accompanying remarks contain "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These forward looking statements include expectations regarding our diversification, growth opportunities, retention rates, liquidity, investment returns and ability to meet our investment objectives and to manage and mitigate market risk with respect to our investments. These statements are based on current expectations, estimates and projections about the industry and market in which we operate, and management’s current beliefs and assumptions. Without limiting the generality of the foregoing, words such as "may," "will," "expect," "endeavor," "project," "believe," "anticipate," "intend," "could," "would," "estimate" or "continue" or the negative variations thereof, or comparable terminology, are intended to identify forward-looking statements. Forward-looking statements are not guarantees of future performance and involve certain known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. The risks and uncertainties include, without limitation: the regulatory, economic and weather conditions in the states in which we operate; the impact of new federal or state regulations that affect the property and casualty insurance market; the cost, variability and availability of reinsurance; assessments charged by various governmental agencies; pricing competition and other initiatives by competitors; our ability to attract and retain the services of senior management; the outcome of litigation pending against us, including the terms of any settlements; dependence on investment income and the composition of our investment portfolio and related market risks; our exposure to catastrophic events and severe weather conditions; downgrades in our financial strength ratings; risks and uncertainties relating to our acquisitions, including our ability to successfully integrate the acquired companies; and other risks and uncertainties described in the section entitled "Risk Factors" and elsewhere in our filings with the Securities and Exchange Commission (the "SEC"), including our Annual Report in Form 10-K for the year ended December 31, 2025 and 2024. We caution you not to place undue reliance on these forward looking statements, which are valid only as of the date they were made. Except as may be required by applicable law, we undertake no obligation to update or revise any forward-looking statements to reflect new information, the occurrence of unanticipated events, or otherwise. This presentation contains certain non-GAAP financial measures. These measures should be considered supplementary to our results of operations and financial condition that are presented in accordance with GAAP and should not be viewed as a substitute for GAAP measures. See our earnings release, Form 10-K and Form 10-Q for further information regarding these non-GAAP financial measures.