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 up to $1.7 billion pre-tax, and significant portfolio remediation.

• Total shareholder return for 2024 was 9.2%, with net income reaching $1.4 billion and net operating income at $1.3 billion, despite a Q4 net loss of $593 million due to reserve actions.

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

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

• Strategic focus remained on underwriting discipline, selective growth in property and specialty lines, and exiting underperforming business.

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% year-over-year.

• Full-year combined ratio was 102.3%, up from 90.9% prior year, with Q4 combined ratio at 135.5% due to reserve actions.

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

• Book value per share ended at $322.97, up 8.7% from year-end 2023 (adjusted for dividends); excluding unrealized losses: $342.74.

• Operating cash flow reached a record $5.0 billion for the year.

Outlook and guidance

• Targeting mid-teens total shareholder return over the cycle, with confidence in achieving this in 2025.

• Effective tax rate expected to rise to 17%-18% in 2025 due to Bermuda tax changes.

• Q1 2025 pre-tax net catastrophe loss from California wildfires estimated at $350–$450 million.

• Continued focus on portfolio quality, with further remediation in U.S. casualty and growth in international short-tail and specialty lines.

• Market conditions in reinsurance expected to remain attractive in 2025.