Kestrel Group (KG) Q2 2025 earnings summary

Executive summary

• Completed a transformative business combination with Maiden Holdings, creating a capital-light, fee-based insurance platform focused on program services and legacy reinsurance run-off.

• Net income for Q2 2025 was $69.9M, driven by a $73.6M bargain purchase gain from the Maiden transaction; excluding this, a net loss of $3.7M was reported due to higher operating and interest expenses and foreign exchange losses.

• Book value per common share rose to $19.39 at June 30, 2025, from $1.67 at year-end 2024, reflecting the impact of the combination.

Financial highlights

• Gross premiums written and net premiums earned were $1.1M and $2.4M, respectively, for both the three and six months ended June 30, 2025.

• Underwriting and fee income was $6.1M for Q2 2025, up from breakeven in Q2 2024, mainly due to favorable prior year loss development in legacy reinsurance.

• Net investment income increased to $1.5M, with realized and unrealized investment gains of $1.1M for the quarter.

• Non-GAAP operating earnings were $3.5M for Q2 2025, compared to a loss of $0.5M in Q2 2024.

• Annualized non-GAAP operating ROE was 18.0% for Q2 2025.

Outlook and guidance

• Strategic focus is on growing fee income from program services and reducing exposure to alternative investments to enhance liquidity and support growth.

• The company expects to continue running off legacy reinsurance liabilities and is actively seeking finality solutions for AmTrust exposures.

• No new commitments to alternative investments are planned; the portfolio is expected to shrink as assets are monetized.