American Financial Group (AFG) investor relations material

Executive summary

• Net earnings for Q2 2025 were $174 million ($2.07 per diluted share), down from $209 million ($2.49 per share) in Q2 2024, with core net operating earnings per share at $2.14.

• Core net operating earnings declined year-over-year, reflecting lower underwriting profit and reduced returns on alternative investments, but sequential improvement was noted.

• Annualized ROE was 15.0% and core operating ROE was 15.5% for Q2 2025.

• Book value per share at June 30, 2025, was $54.15–$55.74; growth in book value per share plus dividends was 4.7% for the quarter and 6% for the first half.

• Over $100 million was returned to shareholders in Q2 2025 through dividends and share repurchases.

Financial highlights

• Net earned premiums for Q2 2025 were $1.65 billion, up 4% year-over-year; net written premiums reached $1.80 billion, up from $1.69 billion in Q2 2024.

• Underwriting profit for Q2 2025 was $113–$114 million, down from $150–$151 million a year ago.

• Net investment income excluding alternatives rose 10% year-over-year; including alternatives, it was down 2–5%.

• Combined ratio for Specialty P&C was 93.1%, up from 90.5% in Q2 2024.

• Catastrophe losses were $38 million in Q2 2025 (2.3 points on combined ratio).

Outlook and guidance

• Management expects continued premium growth and strong underwriting for the full year 2025, supported by favorable pricing and new business opportunities.

• Operations are expected to generate significant excess capital, supporting acquisitions, special dividends, or share repurchases.

• Long-term alternative investment returns are expected to average 10% or better.

• Elevated interest rates are expected to further boost investment income on fixed maturities.

• Economic and social inflation, supply chain disruptions, and macro factors may impact premiums, loss trends, and investment returns.