Everest Group (EG) Q1 2021 earnings summary

Executive summary

• Net income was $341.9M, or $8.52 per diluted share; net operating income was $260.2M, or $6.49 per diluted share.

• Gross written premiums grew 14% and net written premiums 16%; attritional combined ratio improved 2.5 pts YoY to 87.3%.

• Underwriting income was $45M, including $270M of pre-tax catastrophe losses ($260M net of reinstatement premiums); combined ratio was 98.1%.

Financial highlights

• Total revenue was $2,743.8M vs. $1,982.0M in Q1 2020; premiums earned were $2,387.9M vs. $2,036.8M.

• Net investment income was $260.4M, including $120.3M of alternative investment gains.

• Operating cash flow was $904.4M vs. $506.0M in Q1 2020.

Outlook and guidance

• April reinsurance renewals were completed with rate increases on Japanese and retrocessional business; pro-rata business benefited from primary rate improvement.

• Q1 insurance renewal rates increased 16% excluding workers’ compensation and 10% including workers’ compensation.