Kingstone Companies (KINS) Q3 2024 earnings summary

Executive summary

• Achieved record quarterly income and premium growth, with net income of $7 million for Q3 2024 and $12.92 million year-to-date, marking a return to profitability and the best quarter since 2009 acquisition.

• Core personal lines business in New York grew 39.4% year-over-year, driven by competitor exits, with core now representing 93% of total policies.

• Operational and strategic initiatives improved underwriting, reduced expenses, and shifted focus to profitable core business.

• Benefited from market dislocation as major competitors exited the New York market, leading to increased policies in force and premium growth.

• Book value per share (diluted) increased 112% year-over-year to $4.58 as of September 30, 2024.

Financial highlights

• Net income of $7 million ($0.61 per basic share) for Q3 2024; $12.92 million year-to-date, reversing prior year losses.

• Direct written premiums up 28.1% overall, with core direct written premiums up 39.4% year-over-year in Q3 2024.

• Combined ratio improved by 38.2 points to 72% for Q3 2024; net loss ratio dropped to 39.0%.

• Annualized return on equity reached 55.6% for the quarter.

• Book value per share increased, with total stockholders' equity at $59.67 million as of September 30, 2024.

Outlook and guidance

• 2024 guidance: reaffirmed core business direct premiums written growth of 25–35%, combined ratio 79–83%, EPS $1.40–$1.70, ROE 32–36%.

• 2025 guidance: core business direct written premium growth 15–25%, combined ratio 82–86%, EPS $1.60–$2.00, ROE 24–32%.

• Guidance reflects competitive changes, higher reinsurance costs, and assumes an average catastrophe year for 2025.

• Expects continued growth in policies in force and direct written premiums through year-end 2024 due to competitor exits and strong core business momentum.

• Underwriting changes emphasize profitability over growth, with ongoing culling of unprofitable risks and focus on rate adequacy.