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Kinsale Capital (KNSL) Q4 Earnings Top, Premiums Rise Y/Y
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Kinsale Capital Group (KNSL - Free Report) delivered fourth-quarter 2022 net operating earnings of $2.60 per share, which outpaced the Zacks Consensus Estimate by 20.4%. The bottom line improved 49.4% year over year.
The results benefited from rate increases, focus on disciplined underwriting and cost management.
Kinsale Capital Group, Inc. Price, Consensus and EPS Surprise
Total revenues rose about 32.1% year over year to about $243 million. The growth can primarily be attributed to a rise in premiums and higher net investment income. The top line beat the Zacks Consensus Estimate by 3%.
Gross written premiums of $295.5 million rose 45% year over year, driven by strong submission flow from brokers and a favorable pricing environment. Net written premiums climbed 36.4% year over year to $242.1 million in the quarter.
Net investment income more than doubled year over year to $17.7 million in the quarter. The upside came on the back of growth in the investment portfolio and higher interest rate.
Total expenses increased 28.6% year over year to $158.8 million due to a rise in losses and loss adjustment expenses and underwriting, acquisition and insurance expenses as well as interest and other expenses.
Kinsale Capital’s underwriting income of $59.5 million improved 41% year over year, driven by premium growth and favorable rate increases from a strong underwriting environment and lower levels of operating expenses. The combined ratio improved 210 basis points (bps) to 72.4.
While the expense ratio improved 150 bps to 19.9 in the quarter, the loss ratio improved 60 bps to 52.5.
Financial Update
Kinsale Capital exited 2022 with cash and cash equivalents of $156.3 million, which increased 29.1% from the 2021-end level. As of Dec 31, 2022, debt was $195.7 million, up more than fourfold from the level at 2021 end.
As of Sep 30, 2022, stockholders’ equity increased 6.6% to $745.4 million from the 2021-end level.
Annualized operating return on equity expanded 420 bps year over year to 25% in 2000.
The Travelers Companies, Inc. (TRV - Free Report) reported fourth-quarter 2022 core income of $3.40 per share, which matched the Zacks Consensus Estimate. The bottom line decreased 35% year over year. Total revenues increased 7.5% from the year-ago quarter to about $9.6 billion, primarily driven by higher premiums and fee income. The top-line figure beat the Zacks Consensus Estimate by 0.2%.
Net written premiums increased 10% year over year to $8.8 billion. The figure was higher than our estimate of $8.6 billion. Catastrophe losses totaled $459 million pre-tax, wider than $36 million pre-tax in the prior-year quarter. Travelers witnessed an underwriting gain of $449 million, down 51.5% year over year. The combined ratio deteriorated 650 bps year over year to 94.5.
The Progressive Corporation’s (PGR - Free Report) fourth-quarter 2022 earnings per share of $1.50 beat the Zacks Consensus Estimate of $1.49 as well as our estimate of $1.34. The bottom line improved 42.9% year over year
Net premiums earned grew 11% to $12.9 billion and beat our estimate of $12.3 billion. The combined ratio — the percentage of premiums paid out as claims and expenses — improved 80 bps from the prior-year quarter’s level to 93.9.
RLI Corp. (RLI - Free Report) reported fourth-quarter 2022 operating earnings of $1.53 per share, beating the Zacks Consensus Estimate by 41.7%. The bottom line improved 26.4% from the prior-year quarter. Operating revenues for the reported quarter were $329.5 million, up 19.4% year over year. The top line beat the Zacks Consensus Estimate by 0.4%.
Gross premiums written increased 14% year over year to $383.8 million. Underwriting income of $54 million increased 8.7%, primarily due to higher profitability at its Property segment. The combined ratio deteriorated 140 bps year over year to 82.1.
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Kinsale Capital (KNSL) Q4 Earnings Top, Premiums Rise Y/Y
Kinsale Capital Group (KNSL - Free Report) delivered fourth-quarter 2022 net operating earnings of $2.60 per share, which outpaced the Zacks Consensus Estimate by 20.4%. The bottom line improved 49.4% year over year.
The results benefited from rate increases, 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 about 32.1% year over year to about $243 million. The growth can primarily be attributed to a rise in premiums and higher net investment income. The top line beat the Zacks Consensus Estimate by 3%.
Gross written premiums of $295.5 million rose 45% year over year, driven by strong submission flow from brokers and a favorable pricing environment. Net written premiums climbed 36.4% year over year to $242.1 million in the quarter.
Net investment income more than doubled year over year to $17.7 million in the quarter. The upside came on the back of growth in the investment portfolio and higher interest rate.
Total expenses increased 28.6% year over year to $158.8 million due to a rise in losses and loss adjustment expenses and underwriting, acquisition and insurance expenses as well as interest and other expenses.
Kinsale Capital’s underwriting income of $59.5 million improved 41% year over year, driven by premium growth and favorable rate increases from a strong underwriting environment and lower levels of operating expenses. The combined ratio improved 210 basis points (bps) to 72.4.
While the expense ratio improved 150 bps to 19.9 in the quarter, the loss ratio improved 60 bps to 52.5.
Financial Update
Kinsale Capital exited 2022 with cash and cash equivalents of $156.3 million, which increased 29.1% from the 2021-end level. As of Dec 31, 2022, debt was $195.7 million, up more than fourfold from the level at 2021 end.
As of Sep 30, 2022, stockholders’ equity increased 6.6% to $745.4 million from the 2021-end level.
Annualized operating return on equity expanded 420 bps year over year to 25% in 2000.
Zacks Rank
Kinsale Capital currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Some Other P&C Insurers
The Travelers Companies, Inc. (TRV - Free Report) reported fourth-quarter 2022 core income of $3.40 per share, which matched the Zacks Consensus Estimate. The bottom line decreased 35% year over year. Total revenues increased 7.5% from the year-ago quarter to about $9.6 billion, primarily driven by higher premiums and fee income. The top-line figure beat the Zacks Consensus Estimate by 0.2%.
Net written premiums increased 10% year over year to $8.8 billion. The figure was higher than our estimate of $8.6 billion. Catastrophe losses totaled $459 million pre-tax, wider than $36 million pre-tax in the prior-year quarter. Travelers witnessed an underwriting gain of $449 million, down 51.5% year over year. The combined ratio deteriorated 650 bps year over year to 94.5.
The Progressive Corporation’s (PGR - Free Report) fourth-quarter 2022 earnings per share of $1.50 beat the Zacks Consensus Estimate of $1.49 as well as our estimate of $1.34. The bottom line improved 42.9% year over year
Net premiums earned grew 11% to $12.9 billion and beat our estimate of $12.3 billion. The combined ratio — the percentage of premiums paid out as claims and expenses — improved 80 bps from the prior-year quarter’s level to 93.9.
RLI Corp. (RLI - Free Report) reported fourth-quarter 2022 operating earnings of $1.53 per share, beating the Zacks Consensus Estimate by 41.7%. The bottom line improved 26.4% from the prior-year quarter. Operating revenues for the reported quarter were $329.5 million, up 19.4% year over year. The top line beat the Zacks Consensus Estimate by 0.4%.
Gross premiums written increased 14% year over year to $383.8 million. Underwriting income of $54 million increased 8.7%, primarily due to higher profitability at its Property segment. The combined ratio deteriorated 140 bps year over year to 82.1.