Employers Holdings posts $11.6M profit in Q3 2026
EIG’s excess workers’ compensation product had 31 accounts and $6.5 million in premium to date.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
8-K
Rhea-AI Filing Summary
Employers Holdings, Inc. (EIG) reported third-quarter 2026 net income of $11.6 million, or $0.64 per diluted share, versus a net loss of $8.3 million, or $(0.36) per diluted share, a year earlier. Adjusted net income was $12.8 million, versus an adjusted net loss of $25.5 million. The company attributed the improvement primarily to the absence of prior-year reserve strengthening.
Gross premiums written fell 17.8% to $151.1 million and net premiums earned fell 17% to $160.2 million as pricing and underwriting actions prioritized profitability over volume. The GAAP combined ratio was 108.4%, compared with 129.7%; the loss and LAE ratio was 71.2%, versus 97.1%. Net investment income rose to $32.3 million from $26.1 million, while net realized and unrealized investment results were a $3.2 million loss versus a $21.2 million gain.
The board declared a $0.34 per-share dividend, payable December 3, 2026, to stockholders of record as of November 12, 2026. EIG repurchased 373,848 shares at an average $48.44 per share; $94.9 million remained under the 2026 Program.
3 points · 0 major0 major · 2 points
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Moderate point$11.6 million net income versus a third-quarter 2025 net loss of $8.3 million.
- Moderate pointNet investment income rose to $32.3 million from $26.1 million.
- Minor point. Forward-looking: it has not happened yet and may not happen.Quarterly dividend increased 6% to $0.34 per share.
Negative
- Moderate pointNet premiums earned fell 17% to $160.2 million from $192.1 million.
- Moderate pointInvestments recorded a $3.2 million loss, versus a $21.2 million gain.
Filing Explained
At
8-K Event Classification
3 items: 2.02, 8.01, 9.01
3 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Net income: $11.6 million
Adjusted net income: $12.8 million
Gross premiums written: $151.1 million
+5 more
8 metrics
Net income
$11.6 million
Three months ended September 30, 2026; versus a net loss of $8.3 million in 2025
Adjusted net income
$12.8 million
Three months ended September 30, 2026; versus an adjusted net loss of $25.5 million in 2025
Gross premiums written
$151.1 million
Three months ended September 30, 2026; down 17.8% from $183.9 million in 2025
Net premiums earned
$160.2 million
Three months ended September 30, 2026; down 17% from $192.1 million in 2025
GAAP combined ratio
108.4%
Three months ended September 30, 2026; compared with 129.7% in 2025
Net investment income
$32.3 million
Three months ended September 30, 2026; up 23.8% from $26.1 million in 2025
Quarterly dividend
$0.34 per share
Declared for the fourth quarter of 2026; compared with $0.32 per share in third-quarter 2025
Shares repurchased
373,848 shares at an average price of $48.44 per share
Third quarter of 2026
Key Terms
GAAP combined ratio, Loss and LAE ratio, Deferred Gain, LPT Agreement, +1 more
5 terms
GAAP combined ratio financial
"GAAP combined ratio was 108.4%, compared with 129.7%"
Loss and LAE ratio financial
"loss and LAE ratio was 71.2%, versus 97.1%"
The loss and LAE ratio measures how much an insurer spends on claims and the costs of handling those claims (investigations, legal fees, settlements) compared with the premiums it earned. For investors, it shows whether the core insurance business is profitable: a lower ratio means more of each premium dollar remains after paying claims and claim-related costs, while a higher ratio signals potential underwriting losses — similar to comparing repair bills plus service fees to the revenue from selling warranties.
Deferred Gain financial
"Book value per share including the Deferred Gain"
LPT Agreement financial
"Net income (loss) excluding LPT Agreement"
Modified duration financial
"Modified duration is measured by the sensitivity to changes in interest rates"
A measure of a bond or fixed-income portfolio’s price sensitivity to changes in interest rates, expressed as the approximate percentage change in price for a one percentage-point move in yield. It matters to investors because it quantifies interest-rate risk—higher modified duration means larger price swings for the same rate change, allowing comparison of how different bonds or portfolios will react, like how a longer seesaw arm produces bigger movement.
Earnings Snapshot
Net income: $11.6 million
Three months ended September 30, 2026
Net income
$11.6 million
Versus a net loss of $8.3 million in third-quarter 2025
Gross premiums written
$151.1 million
Down 17.8% from $183.9 million in third-quarter 2025
Net premiums earned
$160.2 million
Down 17% from $192.1 million in third-quarter 2025
Net investment income
$32.3 million
Up 23.8% from $26.1 million in third-quarter 2025
GAAP combined ratio
108.4%
Compared with 129.7% in third-quarter 2025
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were EIG’s third-quarter 2026 earnings?
EIG reported third-quarter 2026 net income of $11.6 million, or $0.64 per diluted share, compared with a net loss of $8.3 million, or $(0.36) per diluted share, in third-quarter 2025. Adjusted net income was $12.8 million, versus an adjusted net loss of $25.5 million.
What dividend did EIG declare?
EIG declared a regular quarterly dividend of $0.34 per share, compared with $0.32 per share in third-quarter 2025. It is payable December 3, 2026, to stockholders of record as of November 12, 2026.
How many policies were in force at EIG at September 30, 2026?
EIG reported 124,043 policies in force, compared with 135,414 a year earlier; the company described this as an 8% decline.
AI-generated analysis. How Rhea-AI works. Not financial advice.
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): October 28, 2026
(Exact Name of Registrant as Specified in its Charter)
——————
| (State or Other Jurisdiction of Incorporation) | |||||||||||
| (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||
| (Address of Principal Executive Offices) | |||||||||||
| (Zip Code) | |||||||||||
Registrant’s telephone number including area code: (888 ) 682-6671
No change since last report
(Former Name or 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:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
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. o
Section 2 – Financial Information
Item 2.02. Results of Operations and Financial Condition.
On October 28, 2026, Employers Holdings, Inc. (the “Company”) issued a press release and financial supplement announcing results for the quarter ended September 30, 2026. The press release and financial supplement are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference, and are being furnished, not filed, under Item 2.02 to this Current Report on Form 8-K.
Section 8 – Other Information
Item 8.01. Other Events.
On October 28, 2026, the Company's Board of Directors (Board) declared a regular quarterly dividend of $0.34 per share on the Company’s common stock. The dividend is payable on December 3, 2026 to stockholders of record as of November 12, 2026.
Section 9 – Financial Statements and Exhibits
Item 9.01. Financial Statements and Exhibits.
99.1 Employers Holdings, Inc. press release, dated October 28, 2026.
99.2 Employers Holdings, Inc. financial supplement, dated October 28, 2026.
104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
SIGNATURE
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.
EMPLOYERS HOLDINGS, INC. | ||||||||
| Dated: | October 28, 2026 | /s/ Michael A. Pedraja | ||||||
Michael A. Pedraja | ||||||||
| Executive Vice President, | ||||||||
| Chief Financial Officer | ||||||||
Exhibit Index
| Exhibit No. | Exhibit | |||||||
| 99.1 | Employers Holdings, Inc. press release, dated | October 28, 2026 | ||||||
| 99.2 | Employers Holdings, Inc. financial supplement, dated | October 28, 2026 | ||||||
Exhibit 99.1news release
For Immediate Release
Employers Holdings, Inc. Reports Third Quarter 2026 Results and
Declares Regular Quarterly Dividend of $0.34 per Share
Company to Host Conference Call on Thursday, October 29, 2026, at 11:00 a.m. Eastern Time
RENO, Nev., October 28, 2026 - (GLOBE NEWSWIRE) - Employers Holdings, Inc. (the “Company”) (NYSE:EIG), a holding company with subsidiaries that are specialty providers of workers’ compensation insurance, excess workers’ compensation, and related services, today reported financial results for its third quarter ended September 30, 2026.
Third Quarter 2026 Financial Highlights
(All comparisons versus third quarter 2025)
•Net income (loss) of $11.6 million ($0.64 per diluted share), versus $(8.3) million ($(0.36) per diluted share);
•Adjusted net income (loss) of $12.8 million ($0.71 per diluted share), versus $(25.5) million ($(1.10) per diluted share);
•Gross premiums written of $151.1 million, versus $183.9 million;
•Net premiums earned of $160.2 million, versus $192.1 million;
•Loss and LAE ratio decreased to 71.2% from 97.1%;
•Commission expense ratio increased to 12.9% from 12.0%;
•Underwriting expense ratio increased to 24.3% from 20.6%;
•GAAP combined ratio of 108.4% (109.2% excluding the LPT), versus 129.7% (130.4% excluding the LPT);
•Net investment income increased to $32.3 million from $26.1 million;
•Net realized and unrealized (losses) gains on investments of $(3.2) million, versus $21.2 million;
•Policies in force of 124,043, versus 135,414;
•Book value per share including the Deferred Gain of $49.44, an increase of 2.1%, and Adjusted book value per share of $53.64, up 7.1% (both growth rates include dividends declared); and
•Returned $24.4 million to stockholders through a combination of share repurchases and regular quarterly dividends.
CEO Commentary
Chief Executive Officer Katherine Antonello commented: “Our third quarter results reflect the progress we are making to restore our underwriting profitability to historical levels. We reported net income of $11.6 million, or $0.64 per diluted share, compared with a net loss of $8.3 million, or $(0.36) per diluted share, in the third quarter of 2025. The improvement was driven primarily by the absence of the reserve strengthening we recorded in that quarter, and we have not recognized any prior year loss development on our voluntary business this year. Our loss and LAE ratio improved to 71.2% from 97.1%, and our current accident year loss and LAE ratio on voluntary business, excluding LPT, was 72.0%.
Gross premiums written were $151.1 million, a decrease of 18%, and net premiums earned were $160.2 million, a decrease of 17%. These decreases reflect the pricing and underwriting actions we have taken to prioritize profitability in the prolonged soft market. Our GAAP combined ratio improved to 108.4% from 129.7%. Our underwriting expense ratio rose to 24.3% because of the smaller premium base, while underwriting expenses themselves were slightly lower than last year. Returning to an underwriting profit remains our top priority. Policies in force declined 8% to 124,043, a smaller decline than premium, as we retained the majority of our small business customers while exiting selected classes of business.”
Ms. Antonello continued, “Our investment portfolio continues to be a source of strength. Net investment income increased to $32.3 million, supported by higher yields following our 2025 investment rebalancing and $5.6 million in returns from our private equity investments. With the significant rise in U.S. interest rates, our investment portfolio is well positioned to take advantage of higher reinvestment rates to contribute meaningfully to earnings over time. We also remain committed to returning capital to our stockholders, and this quarter we returned $24.4 million through share repurchases and our regular quarterly dividend. Book value
per share, including the Deferred Gain, grew 2.1% year over year, and adjusted book value per share grew 7.1%, both including dividends declared.
Looking ahead, expanding our workers’ compensation product offering will drive additional profitable growth. Our excess workers’ compensation product, which we launched in June, is off to a strong start, with 31 accounts and $6.5 million in premium to date. Our second new product, large deductible, which we are developing internally, is targeted to launch next year. With these initiatives, I am confident we are building a stronger, more resilient company.”
Summary of Consolidated Third Quarter 2026 Results
(All comparisons versus third quarter 2025, unless otherwise noted)
Gross premiums written were $151.1 million, a decrease of 17.8%, reflecting the deliberate pricing and underwriting actions commenced in 2025 to prioritize profitability over volume. These actions contributed to declines in new and renewal business premiums in the quarter.
Losses and LAE were $114.0 million, a decrease of 38.9%, due primarily to the absence of the prior-period reserve strengthening that we recognized last year (approximately $38.0 million) and partially due to lower premium levels. The Company’s voluntary business current accident year loss and LAE ratio, excluding the LPT, was 72.0%.
Commission expense was $20.6 million, a decrease of 10.4%, consistent with lower premiums. The Company’s commission expense ratio was 12.9%, compared to 12.0% a year ago. The increase in the commission expense ratio was primarily the result of higher commission rates on new business writings in 2026 combined with a one-time adjustment that reduced the 2025 third quarter ratio.
Underwriting expenses were $38.9 million, a decrease of 1.8%. The Company’s underwriting expense ratio was 24.3%, compared to 20.6% a year ago. The decrease in our underwriting expenses was primarily driven by reduced policyholder dividends, bad debt, and premium taxes and assessments. The increase in underwriting expense ratio was due to the decrease in premiums earned.
Net investment income was $32.3 million, an increase of 23.8%. The increase was primarily the result of returns from our private equity investments, along with higher yields on fixed maturity securities resulting from our investment rebalancing activity in 2025.
Net realized and unrealized (losses) gains on investments reflected on the income statement were $(3.2) million compared to $21.2 million a year ago. The current quarter’s result was driven by a distribution-related reduction in our private equity investment net asset value and reduced common equity investment gains.
Interest and financing expenses were $1.3 million versus $0.2 million a year ago. The increase in interest expense relates to the Company’s $125.0 million senior debt associated with the recapitalization plan announced in the fourth quarter of 2025.
Federal and state income tax expense (benefit) was $2.9 million (20.0% effective tax rate), compared to $(2.9) million (25.9% effective benefit rate) a year ago. The effective rates in each period reflect applicable income tax benefits and exclusions associated with tax-advantaged investment income, LPT adjustments, deferred gain amortization, and tax credits utilized.
Compared to last quarter, book value per share including the Deferred Gain declined by 5.3% (including dividends) to $49.44, driven by the unrealized market value decline in our fixed income investments, due directly to the increase in interest rates. This decline reflects changes in interest rates rather than underlying credit quality. Adjusted book value per share, which excludes accumulated other comprehensive income, increased by 1.3% (including dividends) in the quarter to $53.64.
Fourth Quarter 2026 Dividend Declaration
On October 28, 2026, the Company’s Board of Directors declared a regular quarterly dividend of $0.34 per share. The dividend is payable on December 3, 2026, to stockholders of record as of November 12, 2026.
Stock Repurchases
During the third quarter of 2026, the Company repurchased 373,848 shares of its common stock at an average price of $48.44 per share. The Company has $94.9 million of repurchase authorization remaining under the 2026 Program.
Earnings Conference Call and Webcast
The Company will host a conference call on Thursday, October 29, 2026, at 11:00 a.m. Eastern Time / 8:00 a.m. Pacific Time.
To participate in the live conference call, you must first register here. Once registered you will receive dial-in numbers and a unique PIN number.
The webcast will be accessible on the Company’s website at www.employers.com through the “Investors” link.
Reconciliation of Non-GAAP Financial Measures to GAAP
Within this earnings release we present various financial measures, some of which are “non-GAAP financial measures” as defined in Regulation G pursuant to Section 401 of the Sarbanes-Oxley Act of 2002. A description of these non-GAAP financial measures, as well as a reconciliation of such non-GAAP measures to our most directly comparable GAAP financial measures is included in the attached Financial Supplement. Management believes that these non-GAAP measures are important to the Company’s investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. Management further believes that these measures are more relevant than comparable GAAP measures in evaluating our financial performance.
The information in this press release should be read in conjunction with the Financial Supplement that is attached to this press release and available on our website.
Forward-Looking Statements
In this press release, the Company and its management discuss and make statements based on currently available information regarding their intentions, beliefs, current expectations, and projections of, among other things, the Company’s future performance, economic or market conditions, including current or future levels of inflation, potential implications of increased tariffs, changes in interest rates, labor market expectations, catastrophic events or geo-political conditions, legislative or regulatory actions or court decisions, business growth, retention rates, loss costs, claim trends and the impact of key business initiatives, future technologies and planned investments. Certain of these statements may constitute “forward-looking” statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and are often identified by words such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “target,” “project,” “intend,” “believe,” “estimate,” “predict,” “potential,” “pro forma,” “seek,” “likely,” or “continue,” or other comparable terminology and their negatives. The Company and its management caution investors that such forward-looking statements are not guarantees of future performance. Risks and uncertainties are inherent in the Company’s future performance. Factors that could cause the Company’s actual results to differ materially from those indicated by such forward-looking statements include, among other things, those discussed or identified from time to time in the Company’s public filings with the Securities and Exchange Commission (SEC), including the risks detailed in the Company’s Quarterly Reports on Form 10-Q and the Company’s Annual Reports on Form 10-K. Except as required by applicable securities laws, the Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
Filings with the SEC
The Company’s filings with the SEC and its quarterly investor presentations can be accessed through the “Investors” link on the Company’s website, www.employers.com. The Company’s filings with the SEC can also be accessed through the SEC's EDGAR Database at www.sec.gov (EDGAR CIK No. 0001379041).
About Employers Holdings, Inc.
Employers Holdings, Inc. (NYSE: EIG), is a holding company with subsidiaries that are specialty providers of workers’ compensation insurance, excess workers’ compensation, and related services (collectively “EMPLOYERS®”) focused on small and mid-sized businesses engaged in lower hazard industries with its guaranteed cost product and self-insured enterprises with its excess workers’ compensation product. EMPLOYERS leverages over a century of experience to deliver comprehensive coverage solutions that meet the unique needs of its customers. Drawing from its long history and extensive knowledge, EMPLOYERS empowers businesses by protecting their most valuable asset – their employees – through exceptional claims management, loss control, and risk management services, to help businesses create safer work environments.
EMPLOYERS is also proud to offer Cerity®, which is focused on providing digital-first, direct-to-consumer workers’ compensation insurance solutions with fast and affordable coverage options through a user-friendly online platform.
EMPLOYERS operates throughout the United States, apart from four states that are served exclusively by their state funds. Workers’ Compensation insurance is offered through Employers Insurance Company of Nevada, Employers Compensation Insurance Company, Employers Preferred Insurance Company, Employers Assurance Company and Cerity Insurance Company, and Excess Workers’ Compensation is offered through Employers Assurance Company. Each of EMPLOYERS insurance subsidiaries is rated A (Excellent) by AM Best. Not all companies do business in all jurisdictions. EIG Services, Inc., and Cerity Services, Inc., are subsidiaries of Employers Holdings, Inc. EMPLOYERS® is a registered trademark of EIG Services, Inc., and Cerity® is a registered trademark of Cerity Services, Inc. For more information, please visit www.employers.com, www.employers.com/excess-workers-compensation and www.cerity.com.
Contact Information
Michael Pedraja (775) 327-2706 or mpedraja@employers.com
Exhibit 99.2
Employers Holdings, Inc.
Third Quarter 2026
Financial Supplement
EMPLOYERS HOLDINGS, INC.
Table of Contents
| Page | ||||||||
1 | Consolidated Financial Highlights | |||||||
2 | Summary Consolidated Balance Sheets | |||||||
3 | Summary Consolidated Income Statements | |||||||
4 | Return on Equity | |||||||
5 | Combined Ratios | |||||||
6 | Roll-forward of Unpaid Losses and LAE | |||||||
7 | Consolidated Investment Portfolio | |||||||
8 | Book Value Per Share | |||||||
9 | Earnings Per Share | |||||||
10 | Non-GAAP Financial Measures | |||||||
EMPLOYERS HOLDINGS, INC.
Consolidated Financial Highlights (unaudited)
$ in millions, except per share amounts
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||||||||||||||
| 2026 | 2025 | % change | 2026 | 2025 | % change | |||||||||||||||||||||||||||||||||
| Selected financial highlights: | ||||||||||||||||||||||||||||||||||||||
| Gross premiums written | $ | 151.1 | $ | 183.9 | (18) | % | $ | 495.4 | $ | 599.3 | (17) | % | ||||||||||||||||||||||||||
| Net premiums written | 149.7 | 182.4 | (18) | 491.2 | 594.2 | (17) | ||||||||||||||||||||||||||||||||
| Net premiums earned | 160.2 | 192.1 | (17) | 515.2 | 573.4 | (10) | ||||||||||||||||||||||||||||||||
| Net investment income | 32.3 | 26.1 | 24 | 88.0 | 85.3 | 3 | ||||||||||||||||||||||||||||||||
Net income (loss) excluding LPT(1) | 10.3 | (9.6) | (207) | 46.8 | 29.6 | 58 | ||||||||||||||||||||||||||||||||
Adjusted net income (loss)(1) | 12.8 | (25.5) | (150) | 35.9 | 7.3 | 392 | ||||||||||||||||||||||||||||||||
| Net income (loss) before income taxes | 14.5 | (11.2) | (229) | 61.9 | 41.6 | 49 | ||||||||||||||||||||||||||||||||
| Net income (loss) | 11.6 | (8.3) | (240) | 50.8 | 34.2 | 49 | ||||||||||||||||||||||||||||||||
| Comprehensive (loss) income | (50.2) | 8.3 | (705) | (30.5) | 80.1 | (138) | ||||||||||||||||||||||||||||||||
| Total assets | 3,252.1 | 3,526.4 | (8) | |||||||||||||||||||||||||||||||||||
| Stockholders' equity | 785.6 | 1,039.2 | (24) | |||||||||||||||||||||||||||||||||||
Stockholders' equity including the Deferred Gain(2) | 869.6 | 1,128.6 | (23) | |||||||||||||||||||||||||||||||||||
Adjusted stockholders' equity(2) | 943.6 | 1,165.2 | (19) | |||||||||||||||||||||||||||||||||||
Trailing twelve months adjusted return on stockholders' equity(3) | 4.8 | % | 3.0 | % | 60 | % | ||||||||||||||||||||||||||||||||
| Amounts per share: | ||||||||||||||||||||||||||||||||||||||
| Cash dividends declared per share | $ | 0.34 | $ | 0.32 | 6 | % | $ | 1.00 | $ | 0.94 | 6 | % | ||||||||||||||||||||||||||
Earnings (loss) per diluted share(4) | 0.64 | (0.36) | (278) | 2.73 | 1.42 | 92 | ||||||||||||||||||||||||||||||||
Earnings (loss) per diluted share excluding LPT(4) | 0.57 | (0.41) | (239) | 2.51 | 1.23 | 104 | ||||||||||||||||||||||||||||||||
Adjusted earnings (loss) per diluted share(4) | 0.71 | (1.10) | (165) | 1.93 | 0.30 | 543 | ||||||||||||||||||||||||||||||||
Book value per share(2) | 44.66 | 45.76 | (2) | |||||||||||||||||||||||||||||||||||
Book value per share including the Deferred Gain(2) | 49.44 | 49.70 | (1) | |||||||||||||||||||||||||||||||||||
Adjusted book value per share(2) | 53.64 | 51.31 | 5 | |||||||||||||||||||||||||||||||||||
Combined ratio excluding LPT:(5) | ||||||||||||||||||||||||||||||||||||||
Loss and loss adjustment expense ratio: | ||||||||||||||||||||||||||||||||||||||
Current Year | 72.2 | % | 78.1 | % | 71.9 | % | 72.0 | % | ||||||||||||||||||||||||||||||
Prior Year | (0.2) | 19.7 | (0.2) | 6.8 | ||||||||||||||||||||||||||||||||||
Loss and loss adjustment expense ratio | 72.0 | % | 97.8 | % | 71.7 | % | 78.8 | % | ||||||||||||||||||||||||||||||
Commission expense ratio | 12.9 | % | 12.0 | % | 12.9 | % | 12.6 | % | ||||||||||||||||||||||||||||||
| Underwriting expense ratio | 24.3 | % | 20.6 | % | 23.2 | % | 21.9 | % | ||||||||||||||||||||||||||||||
Combined ratio excluding LPT | 109.2 | % | 130.4 | % | 107.8 | % | 113.3 | % | ||||||||||||||||||||||||||||||
| (1) See Page 3 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||||||||||
(2) See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||||||||||
| (3) See Page 4 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||||||||||
| (4) See Page 9 for description and calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||||||||||
| (5) See Page 5 for details and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||||||||||||||
1
EMPLOYERS HOLDINGS, INC.
Summary Consolidated Balance Sheets (unaudited)
$ in millions, except per share amounts
| September 30, 2026 | December 31, 2025 | |||||||||||||
| ASSETS | ||||||||||||||
| Investments, cash and cash equivalents | $ | 2,334.8 | $ | 2,498.8 | ||||||||||
| Accrued investment income | 15.1 | 15.5 | ||||||||||||
Premiums receivable, net | 317.7 | 335.4 | ||||||||||||
| Reinsurance recoverable, net of allowance, on paid and unpaid losses and LAE | 380.6 | 391.6 | ||||||||||||
| Deferred policy acquisition costs | 55.7 | 57.1 | ||||||||||||
| Deferred income tax asset, net | 36.0 | 14.3 | ||||||||||||
| Other assets | 112.2 | 123.9 | ||||||||||||
| Total assets | $ | 3,252.1 | $ | 3,436.6 | ||||||||||
| LIABILITIES | ||||||||||||||
| Unpaid losses and LAE | $ | 1,733.3 | $ | 1,805.8 | ||||||||||
| Unearned premiums | 374.9 | 391.9 | ||||||||||||
| Commissions and premium taxes payable | 53.5 | 59.9 | ||||||||||||
| Deferred Gain | 84.0 | 88.0 | ||||||||||||
| Debt | 125.0 | 35.0 | ||||||||||||
| Other liabilities | 95.8 | 100.3 | ||||||||||||
| Total liabilities | $ | 2,466.5 | $ | 2,480.9 | ||||||||||
| STOCKHOLDERS' EQUITY | ||||||||||||||
| Common stock and additional paid-in capital | $ | 431.5 | $ | 428.4 | ||||||||||
| Retained earnings | 1,485.8 | 1,453.8 | ||||||||||||
Accumulated other comprehensive (loss) income | (74.0) | 7.3 | ||||||||||||
Treasury stock, at cost | (1,057.7) | (933.8) | ||||||||||||
| Total stockholders’ equity | 785.6 | 955.7 | ||||||||||||
| Total liabilities and stockholders’ equity | $ | 3,252.1 | $ | 3,436.6 | ||||||||||
Stockholders' equity including the Deferred Gain(1) | $ | 869.6 | $ | 1,043.7 | ||||||||||
Adjusted stockholders' equity(1) | 943.6 | 1,036.4 | ||||||||||||
Book value per share (1) | $ | 44.66 | $ | 46.98 | ||||||||||
Book value per share including the Deferred Gain(1) | 49.44 | 51.31 | ||||||||||||
Adjusted book value per share(1) | 53.64 | 50.95 | ||||||||||||
(1) See Page 8 for calculations and Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||
2
EMPLOYERS HOLDINGS, INC.
Summary Consolidated Income Statements (unaudited)
$ in millions
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| Net premiums earned | $ | 160.2 | $ | 192.1 | $ | 515.2 | $ | 573.4 | |||||||||||||||
| Net investment income | 32.3 | 26.1 | 88.0 | 85.3 | |||||||||||||||||||
Net realized and unrealized (losses) gains on investments(1) | (3.2) | 21.2 | 13.8 | 29.3 | |||||||||||||||||||
| Other income (loss) | — | (0.1) | 0.1 | 0.2 | |||||||||||||||||||
| Total revenues | 189.3 | 239.3 | 617.1 | 688.2 | |||||||||||||||||||
| Expenses: | |||||||||||||||||||||||
| Losses and LAE incurred | 114.0 | 186.6 | 365.5 | 447.4 | |||||||||||||||||||
| Commission expense | 20.6 | 23.0 | 66.5 | 72.1 | |||||||||||||||||||
| Underwriting expenses | 38.9 | 39.6 | 119.5 | 125.7 | |||||||||||||||||||
| Interest and financing expenses | 1.3 | 0.2 | 3.7 | 0.3 | |||||||||||||||||||
| Other non-recurring expenses | — | 1.1 | — | 1.1 | |||||||||||||||||||
| Total expenses | 174.8 | 250.5 | 555.2 | 646.6 | |||||||||||||||||||
| Net income (loss) before income taxes | 14.5 | (11.2) | 61.9 | 41.6 | |||||||||||||||||||
| Income tax expense (benefit) | 2.9 | (2.9) | 11.1 | 7.4 | |||||||||||||||||||
| Net income (loss) | 11.6 | (8.3) | 50.8 | 34.2 | |||||||||||||||||||
Unrealized AFS investment (losses) gains arising during the period, net of tax(2) | (61.8) | 14.6 | (82.1) | 43.1 | |||||||||||||||||||
Reclassification adjustment for net realized AFS investment losses in net income, net of tax(2) | — | 2.0 | 0.8 | 2.8 | |||||||||||||||||||
| Total comprehensive (loss) income | $ | (50.2) | $ | 8.3 | $ | (30.5) | $ | 80.1 | |||||||||||||||
| Net income (loss) | $ | 11.6 | $ | (8.3) | $ | 50.8 | $ | 34.2 | |||||||||||||||
| Amortization of the Deferred Gain | (1.3) | (1.3) | (4.0) | (4.6) | |||||||||||||||||||
Net income (loss) excluding LPT Agreement(3) | 10.3 | (9.6) | 46.8 | 29.6 | |||||||||||||||||||
| Net realized and unrealized losses (gains) on investments | 3.2 | (21.2) | (13.8) | (29.3) | |||||||||||||||||||
Other non-recurring expenses | — | 1.1 | — | 1.1 | |||||||||||||||||||
| Income tax (benefit) expense related to items excluded from Net income | (0.7) | 4.2 | 2.9 | 5.9 | |||||||||||||||||||
| Adjusted net income (loss) | $ | 12.8 | $ | (25.5) | $ | 35.9 | $ | 7.3 | |||||||||||||||
(1) Includes unrealized (losses) gains on equity securities and other investments of $(4.3) million and $20.7 million for the three months ended September 30, 2026 and 2025, respectively and $(5.8) million and $28.6 million for the nine months ended September 30, 2026 and 2025, respectively. | |||||||||||||||||||||||
| (2) AFS = Available for Sale securities. | |||||||||||||||||||||||
(3) See Page 10 regarding our use of Non-GAAP Financial Measures. | |||||||||||||||||||||||
3
EMPLOYERS HOLDINGS, INC.
Return on Equity (unaudited)
$ in millions
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Net income (loss) | A | $ | 11.6 | $ | (8.3) | $ | 50.8 | $ | 34.2 | |||||||||||||||||
| Impact of the LPT Agreement | (1.3) | (1.3) | (4.0) | (4.6) | ||||||||||||||||||||||
| Net realized and unrealized losses (gains) on investments | 3.2 | (21.2) | (13.8) | (29.3) | ||||||||||||||||||||||
| Income tax (benefit) expense related to items excluded from Net income | (0.7) | 4.2 | 2.9 | 5.9 | ||||||||||||||||||||||
Adjusted net income (loss)(1) | B | 12.8 | (25.5) | 35.9 | 7.3 | |||||||||||||||||||||
| Stockholders' equity - end of period | $ | 785.6 | $ | 1,039.2 | $ | 785.6 | $ | 1,039.2 | ||||||||||||||||||
| Stockholders' equity - beginning of period | 858.8 | 1,083.1 | 955.7 | 1,068.7 | ||||||||||||||||||||||
| Average stockholders' equity | C | 822.2 | 1,061.2 | 870.7 | 1,054.0 | |||||||||||||||||||||
| Stockholders' equity - end of period | $ | 785.6 | $ | 1,039.2 | $ | 785.6 | $ | 1,039.2 | ||||||||||||||||||
| Deferred Gain - end of period | 84.0 | 89.4 | 84.0 | 89.4 | ||||||||||||||||||||||
| Accumulated other comprehensive loss - end of period | 93.6 | 46.4 | 93.6 | 46.4 | ||||||||||||||||||||||
| Income taxes related to accumulated other comprehensive loss - end of period | (19.6) | (9.8) | (19.6) | (9.8) | ||||||||||||||||||||||
| Adjusted stockholders' equity - end of period | 943.6 | 1,165.2 | 943.6 | 1,165.2 | ||||||||||||||||||||||
| Adjusted stockholders' equity - beginning of period | 956.3 | 1,227.0 | 1,036.4 | 1,245.2 | ||||||||||||||||||||||
Average adjusted stockholders' equity(1) | D | 950.0 | 1,196.1 | 990.0 | 1,205.2 | |||||||||||||||||||||
| Return on stockholders' equity | A / C | 1.4 | % | (0.8) | % | 5.8 | % | 3.2 | % | |||||||||||||||||
Trailing twelve months return on stockholders' equity | — | — | 3.0 | 5.9 | ||||||||||||||||||||||
Adjusted return on stockholders' equity(1) | B / D | 1.3 | % | (2.1) | % | 3.6 | % | 0.6 | % | |||||||||||||||||
Trailing twelve months adjusted return on stockholders' equity(1) | — | — | 4.8 | 3.0 | ||||||||||||||||||||||
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||
4
EMPLOYERS HOLDINGS, INC.
Combined Ratios (unaudited)
$ in millions
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
Net premiums earned | A | $ | 160.2 | $ | 192.1 | $ | 515.2 | $ | 573.4 | |||||||||||||||||
Losses and LAE incurred | B | 114.0 | 186.6 | 365.5 | 447.4 | |||||||||||||||||||||
| Amortization of the Deferred Gain | 1.3 | 1.3 | 4.0 | 4.6 | ||||||||||||||||||||||
Losses and LAE excluding LPT(1) | C | $ | 115.3 | $ | 187.9 | 369.5 | 452.0 | |||||||||||||||||||
| Prior year loss reserve development | (0.3) | 37.8 | (0.7) | 39.4 | ||||||||||||||||||||||
Losses and LAE excluding LPT - current accident year | D | $ | 115.6 | $ | 150.1 | $ | 370.2 | $ | 412.6 | |||||||||||||||||
Commission expense | E | $ | 20.6 | $ | 23.0 | $ | 66.5 | $ | 72.1 | |||||||||||||||||
| Underwriting expenses | F | $ | 38.9 | $ | 39.6 | $ | 119.5 | $ | 125.7 | |||||||||||||||||
GAAP combined ratio: | ||||||||||||||||||||||||||
Loss and LAE ratio | B/A | 71.2 | % | 97.1 | % | 70.9 | % | 78.0 | % | |||||||||||||||||
Commission expense ratio | E/A | 12.9 | 12.0 | 12.9 | 12.6 | |||||||||||||||||||||
| Underwriting expense ratio | F/A | 24.3 | 20.6 | 23.2 | 21.9 | |||||||||||||||||||||
GAAP combined ratio | 108.4 | % | 129.7 | % | 107.0 | % | 112.5 | % | ||||||||||||||||||
Combined ratio excluding LPT:(1) | ||||||||||||||||||||||||||
Loss and LAE ratio excluding LPT | C/A | 72.0 | % | 97.8 | % | 71.7 | % | 78.8 | % | |||||||||||||||||
Commission expense ratio | E/A | 12.9 | 12.0 | 12.9 | 12.6 | |||||||||||||||||||||
| Underwriting expense ratio | F/A | 24.3 | 20.6 | 23.2 | 21.9 | |||||||||||||||||||||
Combined ratio excluding LPT | 109.2 | % | 130.4 | % | 107.8 | % | 113.3 | % | ||||||||||||||||||
Combined ratio excluding LPT: current accident year:(1) | ||||||||||||||||||||||||||
Loss and LAE ratio excluding LPT | D/A | 72.2 | % | 78.1 | % | 71.9 | % | 72.0 | % | |||||||||||||||||
Commission expense ratio | E/A | 12.9 | 12.0 | 12.9 | 12.6 | |||||||||||||||||||||
| Underwriting expense ratio | F/A | 24.3 | 20.6 | 23.2 | 21.9 | |||||||||||||||||||||
Combined ratio excluding LPT: current accident year | 109.4 | % | 110.7 | % | 108.0 | % | 106.5 | % | ||||||||||||||||||
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||
5
EMPLOYERS HOLDINGS, INC.
Roll-forward of Unpaid Losses and LAE (unaudited)
$ in millions
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
| September 30, | September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Unpaid losses and LAE at beginning of period | $ | 1,775.2 | $ | 1,786.8 | $ | 1,805.8 | $ | 1,808.2 | |||||||||||||||
| Reinsurance recoverable, excluding CECL allowance, on unpaid losses and LAE | 380.1 | 401.0 | 386.5 | 412.4 | |||||||||||||||||||
| Net unpaid losses and LAE at beginning of period | 1,395.1 | 1,385.8 | 1,419.3 | 1,395.8 | |||||||||||||||||||
| Losses and LAE incurred: | |||||||||||||||||||||||
| Current year losses | 115.6 | 150.1 | 370.2 | 412.6 | |||||||||||||||||||
Prior year losses on voluntary business | — | 38.2 | — | 38.9 | |||||||||||||||||||
| Prior year losses on involuntary business | (0.3) | (0.4) | (0.7) | 0.5 | |||||||||||||||||||
| Total losses incurred | 115.3 | 187.9 | 369.5 | 452.0 | |||||||||||||||||||
| Losses and LAE paid: | |||||||||||||||||||||||
| Current year losses | 44.1 | 38.0 | 74.7 | 72.0 | |||||||||||||||||||
| Prior year losses | 107.8 | 105.9 | 355.6 | 346.0 | |||||||||||||||||||
| Total paid losses | 151.9 | 143.9 | 430.3 | 418.0 | |||||||||||||||||||
| Net unpaid losses and LAE at end of period | 1,358.5 | 1,429.8 | 1,358.5 | 1,429.8 | |||||||||||||||||||
| Reinsurance recoverable, excluding CECL allowance, on unpaid losses and LAE | 374.8 | 392.7 | 374.8 | 392.7 | |||||||||||||||||||
| Unpaid losses and LAE at end of period | $ | 1,733.3 | $ | 1,822.5 | $ | 1,733.3 | $ | 1,822.5 | |||||||||||||||
Total losses and LAE shown in the above table exclude amortization of the Deferred Gain, which totaled $1.3 million for each of the three months ended September 30, 2026 and 2025, and $4.0 million and $4.6 million for the nine months ended September 30, 2026 and 2025, respectively.
6
EMPLOYERS HOLDINGS, INC.
Consolidated Investment Portfolio (unaudited)
$ in millions
| September 30, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||||||||
| Investment Positions: | Cost or Amortized Cost(1) | Net Unrealized Gain (Loss) | Fair Value | % | Fair Value | % | ||||||||||||||||||||||||||||||||
| Fixed maturity securities | $ | 2,068.9 | $ | (93.6) | $ | 1,974.3 | 85 | % | $ | 2,040.7 | 82 | % | ||||||||||||||||||||||||||
| Equity securities | 97.6 | 84.7 | 182.3 | 8 | 191.5 | 8 | ||||||||||||||||||||||||||||||||
| Short-term investments | 13.2 | — | 13.2 | 1 | 10.1 | — | ||||||||||||||||||||||||||||||||
| Other invested assets | 75.0 | 14.1 | 89.1 | 4 | 96.5 | 4 | ||||||||||||||||||||||||||||||||
| Cash and cash equivalents | 75.7 | — | 75.7 | 3 | 159.8 | 6 | ||||||||||||||||||||||||||||||||
| Restricted cash and cash equivalents | 0.2 | — | 0.2 | — | 0.2 | — | ||||||||||||||||||||||||||||||||
| Total investments and cash | $ | 2,330.6 | $ | 5.2 | $ | 2,334.8 | 100 | % | $ | 2,498.8 | 100 | % | ||||||||||||||||||||||||||
| Breakout of Fixed Maturity Securities: | ||||||||||||||||||||||||||||||||||||||
| U.S. Treasuries and agencies | $ | 80.9 | $ | (4.2) | $ | 76.7 | 4 | % | $ | 80.1 | 4 | % | ||||||||||||||||||||||||||
| States and municipalities | 154.8 | (6.8) | 148.0 | 7 | 159.9 | 8 | ||||||||||||||||||||||||||||||||
| Corporate securities | 710.3 | (40.1) | 670.0 | 34 | 655.3 | 32 | ||||||||||||||||||||||||||||||||
| Mortgage-backed securities | 772.0 | (38.5) | 733.5 | 37 | 831.8 | 41 | ||||||||||||||||||||||||||||||||
| Asset-backed securities | 175.0 | (3.1) | 171.9 | 9 | 163.1 | 8 | ||||||||||||||||||||||||||||||||
| Collateralized loan obligations | 2.5 | — | 2.5 | — | 12.5 | 1 | ||||||||||||||||||||||||||||||||
| Bank loans and other | 173.4 | (0.9) | 171.7 | 9 | 138.0 | 7 | ||||||||||||||||||||||||||||||||
| Total fixed maturity securities | $ | 2,068.9 | $ | (93.6) | $ | 1,974.3 | 100 | % | $ | 2,040.7 | 100 | % | ||||||||||||||||||||||||||
| Weighted average book yield | 4.9% | 4.9% | |||||||||||||||||||||
| Average credit quality (S&P) | A+ | A+ | |||||||||||||||||||||
Modified duration(2) | 4.3 | 4.1 | |||||||||||||||||||||
(1) Amortized cost excludes allowance for current expected credit losses of $1.0 million | |||||||||||||||||||||||
| (2) Modified duration is measured by the sensitivity to changes in interest rates | |||||||||||||||||||||||
7
EMPLOYERS HOLDINGS, INC.
Book Value Per Share (unaudited)
$ in millions, except per share amounts
| September 30, 2026 | June 30, 2026 | December 31, 2025 | September 30, 2025 | |||||||||||||||||||||||
| Numerators: | ||||||||||||||||||||||||||
| Stockholders' equity | A | $ | 785.6 | $ | 858.8 | $ | 955.7 | $ | 1,039.2 | |||||||||||||||||
| Plus: Deferred Gain | 84.0 | 85.3 | 88.0 | 89.4 | ||||||||||||||||||||||
Stockholders' equity including the Deferred Gain(1) | B | 869.6 | 944.1 | 1,043.7 | 1,128.6 | |||||||||||||||||||||
Accumulated other comprehensive loss (income) | 93.6 | 15.5 | (9.3) | 46.4 | ||||||||||||||||||||||
Income taxes related to accumulated other comprehensive (loss) income | (19.6) | (3.3) | 2.0 | (9.8) | ||||||||||||||||||||||
Adjusted stockholders' equity(1) | C | $ | 943.6 | $ | 956.3 | $ | 1,036.4 | $ | 1,165.2 | |||||||||||||||||
| Denominator (shares outstanding) | D | 17,590,493 | 17,954,305 | 20,342,135 | 22,709,604 | |||||||||||||||||||||
Book value per share(1) | A / D | $ | 44.66 | $ | 47.83 | $ | 46.98 | $ | 45.76 | |||||||||||||||||
Book value per share including the Deferred Gain(1) | B / D | 49.44 | 52.58 | 51.31 | 49.70 | |||||||||||||||||||||
Adjusted book value per share(1) | C / D | 53.64 | 53.26 | 50.95 | 51.31 | |||||||||||||||||||||
Year-over-year change in:(2) | ||||||||||||||||||||||||||
| Book value per share | 0.5 | % | 7.7 | % | 10.8 | % | 6.3 | % | ||||||||||||||||||
| Book value per share including the Deferred Gain | 2.1 | 9.0 | 11.0 | 6.1 | ||||||||||||||||||||||
| Adjusted book value per share | 7.1 | 5.6 | 3.0 | 5.5 | ||||||||||||||||||||||
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||
(2) Reflects the twelve month change in book value per share after taking into account dividends declared of $1.32, $1.30, $1.26, and $1.24 for the twelve month periods ended September 30, 2026, June 30, 2026, December 31, 2025, and September 30, 2025, respectively. | ||||||||||||||||||||||||||
8
EMPLOYERS HOLDINGS, INC.
Earnings Per Share (unaudited)
$ in millions, except per share amounts
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| September 30, | September 30, | |||||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||||||||||||
| Numerators: | ||||||||||||||||||||||||||
| Net income (loss) | A | $ | 11.6 | $ | (8.3) | $ | 50.8 | $ | 34.2 | |||||||||||||||||
| Impact of the LPT Agreement | (1.3) | (1.3) | (4.0) | (4.6) | ||||||||||||||||||||||
Net income (loss) excluding LPT(1) | B | 10.3 | (9.6) | 46.8 | 29.6 | |||||||||||||||||||||
| Net realized and unrealized losses (gains) on investments | 3.2 | (21.2) | (13.8) | (29.3) | ||||||||||||||||||||||
| Income tax (benefit) expense related to items excluded from Net income | (0.7) | 4.2 | 2.9 | 5.9 | ||||||||||||||||||||||
Adjusted net income (loss)(1) | C | $ | 12.8 | $ | (25.5) | $ | 35.9 | $ | 7.3 | |||||||||||||||||
| Denominators: | ||||||||||||||||||||||||||
| Average common shares outstanding (basic) | D | 17,899,547 | 23,247,221 | 18,473,508 | 23,879,686 | |||||||||||||||||||||
| Average common shares outstanding (diluted) | E | 18,061,623 | 23,351,319 | 18,613,733 | 24,027,153 | |||||||||||||||||||||
| Earnings (loss) per share: | ||||||||||||||||||||||||||
| Basic | A / D | $ | 0.65 | $ | (0.36) | $ | 2.75 | $ | 1.43 | |||||||||||||||||
Diluted | A / E | 0.64 | (0.36) | 2.73 | 1.42 | |||||||||||||||||||||
Earnings (loss) per share excluding LPT:(1) | ||||||||||||||||||||||||||
| Basic | B / D | $ | 0.58 | $ | (0.41) | $ | 2.53 | $ | 1.24 | |||||||||||||||||
Diluted | B / E | 0.57 | (0.41) | 2.51 | 1.23 | |||||||||||||||||||||
Adjusted earnings (loss) per share:(1) | ||||||||||||||||||||||||||
| Basic | C / D | $ | 0.72 | $ | (1.10) | $ | 1.94 | $ | 0.31 | |||||||||||||||||
| Diluted | C / E | 0.71 | (1.10) | 1.93 | 0.30 | |||||||||||||||||||||
(1) See Page 10 for information regarding our use of Non-GAAP Financial Measures. | ||||||||||||||||||||||||||
9
Non-GAAP Financial Measures
Within this earnings release we present the following measures, each of which are "non-GAAP financial measures." A reconciliation of these measures to the Company's most directly comparable GAAP financial measures is included herein. Management believes that these non-GAAP measures are important to the Company's investors, analysts and other interested parties who benefit from having an objective and consistent basis for comparison with other companies within our industry. Management further believes that these measures are more relevant than comparable GAAP measures in evaluating our financial performance.
The LPT Agreement is a non-recurring transaction that no longer provides any ongoing cash benefits to the Company. Management believes that providing non-GAAP measures that exclude the effects of the LPT Agreement (amortization of deferred reinsurance gain, adjustments to LPT Agreement ceded reserves and adjustments to the contingent commission receivable) is useful in providing investors, analysts and other interested parties a meaningful understanding of the Company's ongoing underwriting performance.
Deferred reinsurance gain (Deferred Gain) reflects the unamortized gain from the LPT Agreement. This gain has been deferred and is being amortized using the recovery method, whereby the amortization is determined by the proportion of actual reinsurance recoveries to total estimated recoveries, except for the contingent profit commission, which was amortized through June 30, 2024, the date of its final determination. Amortization is reflected in losses and LAE incurred.
Adjusted net income (loss) (see Page 3 for calculations) is net income (loss) excluding the effects of the LPT Agreement, and net realized and unrealized gains and losses on investments (net of tax), and any miscellaneous non-recurring transactions (net of tax). Management believes that providing this non-GAAP measure is helpful to investors, analysts and other interested parties in identifying trends in the Company's operating performance because such items have limited significance to its ongoing operations or can be impacted by both discretionary and other economic factors and may not represent operating trends.
Stockholders' equity including the Deferred Gain (see Page 8 for calculations) is stockholders' equity including the Deferred Gain. Management believes that providing this non-GAAP measure is useful in providing investors, analysts and other interested parties a meaningful measure of the Company's total underwriting capital.
Adjusted stockholders' equity (see Page 8 for calculations) is stockholders' equity including the Deferred Gain, less accumulated other comprehensive income (loss) (net of tax). Management believes that providing this non-GAAP measure is useful to investors, analysts and other interested parties since it serves as the denominator to the Company's adjusted return on stockholders' equity metric.
Return on stockholders' equity and Adjusted return on stockholders' equity (see Page 4 for calculations). Management believes that these profitability measures are widely used by our investors, analysts and other interested parties.
Book value per share, Book value per share including the Deferred Gain, and Adjusted book value per share (see Page 8 for calculations). Management believes that these valuation measures are widely used by our investors, analysts and other interested parties.
Net income (loss) excluding LPT (see Page 3 for calculations). Management believes that these performance and underwriting measures are widely used by our investors, analysts and other interested parties.
10