Everest Group (EG) Q4 2024 earnings summary

Executive summary

• 2024 was a transformative year, marked by decisive reserve strengthening in U.S. casualty lines across all segments, totaling $1.7 billion pre-tax, and significant portfolio remediation, including exits from underperforming business lines such as medical stop-loss and sports & leisure.

• Achieved a total shareholder return of 9.2% for 2024, with strong growth in property and specialty lines offsetting disciplined reductions in U.S. casualty.

• Net investment income reached a record ~$2 billion for the year, driven by strong fixed income returns.

• Operating income for the year was $1.3 billion, with net income at $1.4 billion and a net income ROE of 9.6%.

• Major catastrophe events, including California wildfires and Hurricane Milton, impacted results, with wildfire losses estimated at $350–$450 million pre-tax.

Financial highlights

• Gross written premiums for 2024 rose to $18.2 billion, up 9.1% year-over-year, with Q4 premiums at $4.7 billion, up 7.2%.

• Combined ratio for 2024 was 102.3%, up from 90.9% in 2023, reflecting reserve actions; Q4 combined ratio was 135.5%.

• Book value per share at year-end was $322.97, up 8.7% from year-end 2023, with dividends paid totaling $7.75 per share.

• Operating cash flow reached a record $5.0 billion for the year; Q4 cash flow was $780 million.

• Net operating income for 2024 was $1.29 billion, down from $2.78 billion in 2023, impacted by reserve actions.

Outlook and guidance

• Targeting mid-teens total shareholder return over the cycle, with continued focus on disciplined underwriting and capital strength.

• Expecting continued portfolio remediation in U.S. casualty and further growth in property and specialty lines; market conditions in reinsurance expected to remain attractive in 2025.

• Effective tax rate for 2025 projected at 17%-18% due to Bermuda tax changes.

• Cash flow from operations expected to be similar to 2024, with catastrophe load as a key variable.

• Management expects actions taken in U.S. casualty lines to position the company for attractive returns throughout the cycle.