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Kinsale Capital (KNSL) Q4 Earnings & Revenues Top, Rise Y/Y
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Kinsale Capital Group (KNSL - Free Report) delivered fourth-quarter 2021 net operating earnings of $1.76 per share, which outpaced the Zacks Consensus Estimate by 25.7%. The bottom line improved 54.5% year over year.
Results benefited from rate increase, focus on disciplined underwriting and cost management.
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Total revenues rose 32.4% year over year to $184 million. The growth can primarily be attributed to a rise in premiums and higher net investment income. The top line surpassed the Zacks Consensus Estimate of $166 million.
Gross written premiums of $203.8 million rose 36% year over year, driven by higher submission activity from brokers and rate increases on bound accounts. Net written premiums climbed 36.2% year over year to $177.5 million in the quarter.
Net investment income increased 32.1% year over year to $8.6 million in the quarter. The upside came on the back of growth in the investment portfolio.
Total expenses increased about 28% year over year to $127.5 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses and other expense.
Kinsale Capital’s underwriting income of $42.2 million soared 94.9% year over year, largely on premium growth and continued rate increases from a strong underwriting environment, lower catastrophe activity and higher net favorable development of loss reserves from prior accident years as well as lower expense. The combined ratio improved 710 basis points (bps) to 75.7 in the quarter under review.
While the expense ratio improved 140 bps to 21.4 in the quarter, the loss ratio improved 570 bps to 53.1.
Full-Year Highlights
Operating earnings of $5.74 per share outpaced the Zacks Consensus Estimate of $5.37. The bottom line improved 81.6% year over year.
Total revenues rose 39.7% year over year to $614 million but missed the Zacks Consensus Estimate of $623 million.
Gross written premiums improved 38.3% to $764.4 million.
The combined ratio improved 760 bps to 77.1.
Financial Update
Kinsale Capital exited 2021 with cash and cash equivalents of $121 million, which increased 57% from the 2020-end level. As of Dec 31, 2021, the credit facility was $42.7 million, up 0.3% from the level at 2020 end.
As of Dec 31, 2021, stockholders’ equity grew 21.3% to $699 million from the 2020-end level.
Annualized operating return on equity expanded 610 bps year over year to 20.8% in 2021.
Zacks Rank
Kinsale Capital currently carries a Zacks Rank #4 (Sell).
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59 per share. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings per share of $1.05 beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.
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Kinsale Capital (KNSL) Q4 Earnings & Revenues Top, Rise Y/Y
Kinsale Capital Group (KNSL - Free Report) delivered fourth-quarter 2021 net operating earnings of $1.76 per share, which outpaced the Zacks Consensus Estimate by 25.7%. The bottom line improved 54.5% year over year.
Results benefited from rate increase, focus on disciplined underwriting and cost management.
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Kinsale Capital Group, Inc. price-consensus-eps-surprise-chart | Kinsale Capital Group, Inc. Quote
Operational Update
Total revenues rose 32.4% year over year to $184 million. The growth can primarily be attributed to a rise in premiums and higher net investment income. The top line surpassed the Zacks Consensus Estimate of $166 million.
Gross written premiums of $203.8 million rose 36% year over year, driven by higher submission activity from brokers and rate increases on bound accounts. Net written premiums climbed 36.2% year over year to $177.5 million in the quarter.
Net investment income increased 32.1% year over year to $8.6 million in the quarter. The upside came on the back of growth in the investment portfolio.
Total expenses increased about 28% year over year to $127.5 million due to a rise in losses and loss adjustment expenses, underwriting, acquisition and insurance expenses and other expense.
Kinsale Capital’s underwriting income of $42.2 million soared 94.9% year over year, largely on premium growth and continued rate increases from a strong underwriting environment, lower catastrophe activity and higher net favorable development of loss reserves from prior accident years as well as lower expense. The combined ratio improved 710 basis points (bps) to 75.7 in the quarter under review.
While the expense ratio improved 140 bps to 21.4 in the quarter, the loss ratio improved 570 bps to 53.1.
Full-Year Highlights
Operating earnings of $5.74 per share outpaced the Zacks Consensus Estimate of $5.37. The bottom line improved 81.6% year over year.
Total revenues rose 39.7% year over year to $614 million but missed the Zacks Consensus Estimate of $623 million.
Gross written premiums improved 38.3% to $764.4 million.
The combined ratio improved 760 bps to 77.1.
Financial Update
Kinsale Capital exited 2021 with cash and cash equivalents of $121 million, which increased 57% from the 2020-end level. As of Dec 31, 2021, the credit facility was $42.7 million, up 0.3% from the level at 2020 end.
As of Dec 31, 2021, stockholders’ equity grew 21.3% to $699 million from the 2020-end level.
Annualized operating return on equity expanded 610 bps year over year to 20.8% in 2021.
Zacks Rank
Kinsale Capital currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Property & Casualty Insurers
Of the insurance industry players that have reported fourth-quarter results so far, The Travelers Companies (TRV - Free Report) , RenaissanceRe Holdings Ltd. (RNR - Free Report) and The Progressive Corporation (PGR - Free Report) beat the Zacks Consensus Estimate for earnings.
Travelers’ core income of $5.20 per share surpassed the Zacks Consensus Estimate of $3.86 and increased 6% year over year. Total revenues rose 7% to about $9 billion and beat the Zacks Consensus Estimate of $8.7 billion.
Travelers’ net written premiums increased 10% year over year to a record $8 billion. The combined ratio deteriorated 130 bps year over year to 88.
RenaissanceRe’s operating earnings per share of $4.71 surpassed the Zacks Consensus Estimate by 27% and rebounded from the year-ago loss of $1.59 per share. Total revenues of $1.39 billion dipped 0.1% year over year.
RenaissanceRe’s gross premiums written surged 40.4% year over year to $1.3 billion. The combined ratio improved 3530 bps year over year to 79.4.
Progressive’s earnings per share of $1.05 beat the Zacks Consensus Estimate of 99 cents but declined 43.2% from the year-ago quarter.
Progressive’s net premiums written were $10.7 billion in the quarter, up 13% from $9.5 billion a year ago. The combined ratio deteriorated 630 bps from the prior-year quarter to 94.7.