Assured Guaranty (AGO) Q4 2024 earnings summary

Executive summary

• Achieved adjusted operating income of $389 million ($7.10 per share) for 2024, with record highs in adjusted book value per share ($170.12) and adjusted operating shareholders' equity per share ($114.75).

• Repurchased 6.2 million shares for $502 million, representing 11% of shares outstanding, and paid $68 million in dividends, returning $570 million to shareholders in 2024.

• Expanded internationally with new offices in Australia and Singapore, and completed consolidation of primary insurance subsidiaries to enhance capital efficiency.

• Successfully concluded litigation with Lehman Brothers International (Europe), resulting in a $103 million pre-tax gain to be recognized in Q1 2025.

• Maintained strong financial strength ratings: AA (S&P), AA+ (KBRA), A1 (Moody's), with stable outlooks.

Financial highlights

• Full-year 2024 adjusted operating income was $389 million ($7.10 per share), down from $648 million ($10.78 per share) in 2023, with prior year results boosted by $175 million in gains from Sound Point and AHP transactions and $208 million in tax benefits.

• Net earned premiums and credit derivative revenues rose to $107 million in Q4 2024 from $86 million in Q4 2023; net investment income from fixed maturity and short-term investments was $93 million in Q4 2024.

• Gross written premiums were $440 million for FY 2024; present value of new business production (PVP) was $402 million for the year.

• Shareholders' equity per share reached $108.80 at year-end, with adjusted operating shareholders' equity per share at $114.75 and adjusted book value per share at $170.12.

• Share price rose 20% during 2024, matching 2023's performance.

Outlook and guidance

• Well positioned for 2025, with a strong U.S. municipal bond market and analysts projecting record or near-record new issue volume.

• Expecting a $103 million pre-tax gain in Q1 2025 from the Lehman Brothers litigation resolution.

• Board increased quarterly dividend to $0.34/share in February 2025, continuing annual increases since 2012.

• Anticipate continued growth in structured finance, especially in Australia and Asia, with a focus on repeatable, shorter-dated business.

• Expected 2025 dividend capacity: $287 million for AG and $192 million for AG Re, based on statutory surplus and investment income.