Everest Group (EG) Q2 2024 earnings summary

Executive summary

• Q2 2024 net income was $724 million, operating income $730 million, with annualized operating ROE of 19.7%-20% and total shareholder return of 20.0%, driven by strong underwriting and record net investment income of $528 million.

• Gross written premiums grew 12.8%-13% year-over-year to $4.7 billion, with robust contributions from both reinsurance and insurance segments and international expansion in Mexico, Colombia, Australia, and plans for Italy.

• Combined ratio for the group was 90.3%, with underwriting profit of $358 million and margin expansion in both segments.

• Shareholders' equity rose to $14.2 billion, with book value per share at $327.68, or $349.30 excluding unrealized losses.

• Net investment income surged 47.9% year-over-year to $528 million, with alternative assets contributing $124 million.

Financial highlights

• Net operating income for Q2 2024 was $730 million ($16.85 per share); net income was $724 million ($16.70 per share).

• Gross written premiums were $4.7 billion, up 12.8%-13% year-over-year in constant dollars.

• Book value per share increased to $327.68, or $349.30 excluding unrealized losses; shareholders' equity at $14.2 billion.

• Operating cash flow was $1.3 billion for Q2 and $2.4 billion for the first half.

• Net investment income reached a record $528 million in Q2, up $170 million year-over-year.

Outlook and guidance

• Targeting a combined ratio of 89%-92% by late 2025, with a 93%-94% run rate for the remainder of 2024 and >17% TSR for 2024–2026.

• Management expects continued premium growth, supported by favorable market conditions in property and specialty lines and international expansion.

• Investment returns expected at 5–6% with a high-quality fixed income portfolio.

• Expense ratio expected to trend downward in 2025 as international scale improves.

• Bermuda entities will be subject to a new 15% corporate income tax starting in 2025.