NYSE:UVE Universal Insurance Q1 2024 Earnings Report $25.62 -0.03 (-0.12%) Closing price 05/6/2025 03:59 PM EasternExtended Trading$26.35 +0.73 (+2.85%) As of 07:23 AM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings History Universal Insurance EPS ResultsActual EPS$1.07Consensus EPS $1.04Beat/MissBeat by +$0.03One Year Ago EPSN/AUniversal Insurance Revenue ResultsActual Revenue$367.96 millionExpected Revenue$336.09 millionBeat/MissBeat by +$31.87 millionYoY Revenue GrowthN/AUniversal Insurance Announcement DetailsQuarterQ1 2024Date4/25/2024TimeN/AConference Call DateFriday, April 26, 2024Conference Call Time10:00AM ETUpcoming EarningsUniversal Insurance's Q2 2025 earnings is scheduled for Thursday, July 24, 2025, with a conference call scheduled on Friday, July 25, 2025 at 10:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Conference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by Universal Insurance Q1 2024 Earnings Call TranscriptProvided by QuartrApril 26, 2024 ShareLink copied to clipboard.There are 6 speakers on the call. Operator00:00:00Good morning. Thank you for joining us today. Welcome to our quarterly earnings call. On the call with me today are Steve Donaghy, Chief Executive Officer and Frank Wilcox, Chief Financial Officer. Before we begin, please note today's discussion may contain forward looking statements and non GAAP financial measures. Operator00:00:19Forward looking statements involve assumptions, risks and uncertainties that could cause actual results to differ materially from those statements. For more information, please see the press release and Universal's SEC filings, all of which are available on the Investors section of our website at universalinsuranceholdings.com and on the SEC's website. A reconciliation of non GAAP financial measures to comparable GAAP measures is included in the quarterly press release and can also be found on Universal's website at universalinsuranceholdings.com. With that, I'll turn the call over to Steve. Speaker 100:00:56Thanks, Arash. Good morning, everyone. It was a strong quarter, including a 29.4% annualized adjusted return on common equity and 35.4 percent adjusted diluted earnings per share growth year over year. Results were solid across the board, including profitable underwriting that was complemented by our non underwriting operations, which is a testament to our differentiated business model. Direct premiums written growth accelerated sequentially as policies in force are stabilizing following our previous underwriting initiatives. Speaker 100:01:34I'm pleased to announce the completion of our 2024 2025 reinsurance renewal for our insurance entities as our program is now fully supported and secured. We've also secured additional multi year coverage taking us through the 2025, 2026 hurricane season and have added new financially strong reinsurers to our existing panel of long term partners. This achievement reflects the diligence and planning of our reinsurance team throughout the year. Program costs and coverage were consistent with our expectations and we'll provide specific details at the end of May as we typically do. I'll turn it over to Frank to walk through our financial results. Speaker 100:02:20Frank? Speaker 200:02:21Thanks, Steve. Good morning. Adjusted diluted earnings per common share was 1.07 dollars up from $0.79 in the prior year quarter. The increase mostly stems from higher underwriting and net investment income, partially offset by lower commission revenue. Core revenue of $364,900,000 was up 15.4% year over year with growth primarily stemming from higher net premiums earned and net investment income, partially offset by lower commission revenue. Speaker 200:02:54Direct premiums written were $446,200,000 up 8.8% from the prior year quarter, including 5.2% growth in Florida and 25.6% growth in other states. Overall growth mostly reflects higher rates, inflation adjustments and stabilizing policies in force. Direct premiums earned were $482,100,000 up 5.9% from the prior year quarter, reflecting rate driven direct premiums written growth over the last 12 months. Net premiums earned were $334,000,000 up 18.4 percent from the prior year quarter. The increase is primarily attributable to higher direct premiums earned and a lower ceded premium ratio. Speaker 200:03:45The net combined ratio was 95.5%, down 4.5 points compared to the prior year quarter. The decrease reflects lower net loss and expense ratios. 71.9 percent net loss ratio was down 1.2 points compared to the prior year quarter, with the decrease primarily attributable to higher net premiums earned associated with lower reinsurance costs in the current quarter. The 23.6 percent net expense ratio improved by 3.3 points compared to the prior year quarter, primarily reflecting higher net premiums earned associated with lower reinsurance costs in the current year and economies of scale. During the Q1, the company repurchased approximately 208,000 shares at an aggregate cost of $4,100,000 The company's current share repurchase authorization program has approximately $20,000,000 remaining. Speaker 200:04:48On April 10, 2024, the Board of Directors declared a quarterly cash dividend of $0.16 per share of common stock payable on May 17, 2024 to shareholders of record as of the close of business on May 10, 2024. With that said, I'd like to ask the operator to open the line for questions. Speaker 300:05:14Thank you. At this time, we will conduct a question and answer session. Speaker 400:05:47I was hoping you could talk a little bit about what seems to be very rapidly changing competitive environment, particularly in Florida. And thoughts on pricing and whether or not there really are folks coming in or out at this point from a competitive perspective? Speaker 100:06:15Yes. Good morning, Paul, and thanks for the question. We're seeing more entrants coming into the market. We continue to see Citizens as a competitive carrier in the state. I think we continue to lean on particular markets where we are open that we feel are profitable. Speaker 100:06:34We've opened additional ones at the end of 2023 and we feel good where we sit today with the business that's coming in. From a rate perspective, it's always a combination of carrier and rate And I think our agency force feels very confident in Universal's ability to support their books of business as well as their insured. So I think our relationships, our rates and the markets that we're open in are serving as well. From a competitive perspective, we see some people doing things that we don't want to do and we don't feel bad about the business going elsewhere, so to say. We also have seen our retention improve quarter over quarter and we feel good about that flowing through the book as well right now. Speaker 100:07:21I don't know if you have anything more specific than that, but I'd be happy to answer anything further if you'd like. Speaker 400:07:28No, that's helpful and interesting. I've heard thoughts and talk of regulatory pressure for pricing because of the tort reform coming, they're not in so this year, but maybe next. But then I fear the other side too that it's been such a tough environment for so long that things will hold on for a long time. Where do you fall in that conversation? Do you see pressure building for sort of an offset for the tort reform? Speaker 400:08:09You do hear people talk about concerns about the affordability of policies just in and of themselves in Florida, the impact that may have on what the regulators want to do? Speaker 100:08:24Yes. There's a lot in that question unpack Paul. I think from affordability perspective that is an issue across the state of Florida right now. And certain segments of the market continue to go to the E and S market where rates are extremely high. We traditionally even in 2023, we looked at our rate indication and we took less as a submitted rate request as a result of the tort reform because we felt good about what was coming through the book. Speaker 100:08:59We're just kicking off our rate analysis as we speak for 2024. And when we get the final figures in, we'll take a look at that and try and do what's best for the market, for ourselves, for our shareholders and for our insurers and try and do the right thing. When you talk about pressures, I think the state of Florida has done a very good job with Torture reform and we're appreciative of that. Could they have gone a little further perhaps? Did they go too far? Speaker 100:09:30I don't think so. So I think as we look in the future, we'll try and take all those measures into account and do the right thing. But we don't feel there's nobody calling or suggesting anything to us that we're not getting any undue pressure so to say at this point. Speaker 400:09:49Fantastic. Congrats on the quarter. Speaker 100:09:52Yes. Thanks, Paul. Have a great day. Speaker 300:09:55Thank you. One moment for next question. Our next question comes from the line of Nick Acabiello of Dowling. Your line is now open. Speaker 500:10:16Thanks guys. Nice quarter. I was just wondering, first off, was there any net prior year development recognized in Speaker 200:10:26Q1? Nothing on a net basis, negligible on a direct. Speaker 500:10:33Got it. Thank you. And I know we'll get more details towards the end of May, but I was just wondering on the comment on the reinsurance program being fully supported and secured. Does that currently assume a similar GAAP retention as the program placed last year? Speaker 100:10:51Yes. If you're referring to the use of the isosceles, yes, that would be consistent with last year. We feel as though that was the right thing to do based on cost and capital utilization from the parent. So, yes. Speaker 500:11:05Okay. Makes sense. Thank you. That's all I had. Speaker 100:11:09Thanks, Nick. Have a good day. Speaker 300:11:23Thank you. This concludes the question and answer session. I would now like to turn it back to Steve Domenge, CEO for closing remarks. Speaker 100:11:32Thank you. I'd like to thank our associates, our consumers, agents and our stakeholders for their continued support of Universal. Wish you all a great day. Thank you. Speaker 300:11:44Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallUniversal Insurance Q1 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) Universal Insurance Earnings HeadlinesUniversal Insurance Holdings, Inc. (NYSE:UVE) Looks Like A Good Stock, And It's Going Ex-Dividend SoonMay 4 at 7:42 PM | finance.yahoo.comUniversal Insurance (NYSE:UVE) vs. Maiden (NASDAQ:MHLD) Head-To-Head AnalysisMay 1, 2025 | americanbankingnews.comHere’s How to Claim Your Stake in Elon’s Private Company, xAII predict this single breakthrough could make Elon the world’s first trillionaire — and mint more new millionaires than any tech advance in history. And for a limited time, you have the chance to claim a stake in this project, even though it’s housed inside Elon’s private company, xAI.May 7, 2025 | Brownstone Research (Ad)Universal Insurance Holdings, Inc. (NYSE:UVE) Q1 2025 Earnings Call TranscriptApril 27, 2025 | insidermonkey.comUniversal Insurance (NYSE:UVE) Reaches New 12-Month High Following Earnings BeatApril 27, 2025 | americanbankingnews.comUniversal Insurance rises 9.0%April 26, 2025 | markets.businessinsider.comSee More Universal Insurance Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like Universal Insurance? Sign up for Earnings360's daily newsletter to receive timely earnings updates on Universal Insurance and other key companies, straight to your email. Email Address About Universal InsuranceUniversal Insurance (NYSE:UVE), together with its subsidiaries, operates as an integrated insurance holding company in the United States. It develops, markets, and underwrites insurance products for personal residential insurance, such as homeowners, renters/tenants, condo unit owners, and dwelling/fire; and offers allied lines, coverage for other structures, and personal property, liability, and personal articles coverages. The company also advises on actuarial issues, oversees distribution, administers claims payments, performs policy administration and underwriting, and assists with reinsurance negotiations; places and manages reinsurance programs for the insurance entities; and operates Clovered.com, a digital agency for various carrier partners and utilization of digital applications for adjusting claims. It offers its products through a network of independent agents, as well as direct-to-consumer online solutions, including digital insurance agency. The company was formerly known as Universal Heights, Inc. and changed its name to Universal Insurance Holdings, Inc. in January 2001. 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There are 6 speakers on the call. Operator00:00:00Good morning. Thank you for joining us today. Welcome to our quarterly earnings call. On the call with me today are Steve Donaghy, Chief Executive Officer and Frank Wilcox, Chief Financial Officer. Before we begin, please note today's discussion may contain forward looking statements and non GAAP financial measures. Operator00:00:19Forward looking statements involve assumptions, risks and uncertainties that could cause actual results to differ materially from those statements. For more information, please see the press release and Universal's SEC filings, all of which are available on the Investors section of our website at universalinsuranceholdings.com and on the SEC's website. A reconciliation of non GAAP financial measures to comparable GAAP measures is included in the quarterly press release and can also be found on Universal's website at universalinsuranceholdings.com. With that, I'll turn the call over to Steve. Speaker 100:00:56Thanks, Arash. Good morning, everyone. It was a strong quarter, including a 29.4% annualized adjusted return on common equity and 35.4 percent adjusted diluted earnings per share growth year over year. Results were solid across the board, including profitable underwriting that was complemented by our non underwriting operations, which is a testament to our differentiated business model. Direct premiums written growth accelerated sequentially as policies in force are stabilizing following our previous underwriting initiatives. Speaker 100:01:34I'm pleased to announce the completion of our 2024 2025 reinsurance renewal for our insurance entities as our program is now fully supported and secured. We've also secured additional multi year coverage taking us through the 2025, 2026 hurricane season and have added new financially strong reinsurers to our existing panel of long term partners. This achievement reflects the diligence and planning of our reinsurance team throughout the year. Program costs and coverage were consistent with our expectations and we'll provide specific details at the end of May as we typically do. I'll turn it over to Frank to walk through our financial results. Speaker 100:02:20Frank? Speaker 200:02:21Thanks, Steve. Good morning. Adjusted diluted earnings per common share was 1.07 dollars up from $0.79 in the prior year quarter. The increase mostly stems from higher underwriting and net investment income, partially offset by lower commission revenue. Core revenue of $364,900,000 was up 15.4% year over year with growth primarily stemming from higher net premiums earned and net investment income, partially offset by lower commission revenue. Speaker 200:02:54Direct premiums written were $446,200,000 up 8.8% from the prior year quarter, including 5.2% growth in Florida and 25.6% growth in other states. Overall growth mostly reflects higher rates, inflation adjustments and stabilizing policies in force. Direct premiums earned were $482,100,000 up 5.9% from the prior year quarter, reflecting rate driven direct premiums written growth over the last 12 months. Net premiums earned were $334,000,000 up 18.4 percent from the prior year quarter. The increase is primarily attributable to higher direct premiums earned and a lower ceded premium ratio. Speaker 200:03:45The net combined ratio was 95.5%, down 4.5 points compared to the prior year quarter. The decrease reflects lower net loss and expense ratios. 71.9 percent net loss ratio was down 1.2 points compared to the prior year quarter, with the decrease primarily attributable to higher net premiums earned associated with lower reinsurance costs in the current quarter. The 23.6 percent net expense ratio improved by 3.3 points compared to the prior year quarter, primarily reflecting higher net premiums earned associated with lower reinsurance costs in the current year and economies of scale. During the Q1, the company repurchased approximately 208,000 shares at an aggregate cost of $4,100,000 The company's current share repurchase authorization program has approximately $20,000,000 remaining. Speaker 200:04:48On April 10, 2024, the Board of Directors declared a quarterly cash dividend of $0.16 per share of common stock payable on May 17, 2024 to shareholders of record as of the close of business on May 10, 2024. With that said, I'd like to ask the operator to open the line for questions. Speaker 300:05:14Thank you. At this time, we will conduct a question and answer session. Speaker 400:05:47I was hoping you could talk a little bit about what seems to be very rapidly changing competitive environment, particularly in Florida. And thoughts on pricing and whether or not there really are folks coming in or out at this point from a competitive perspective? Speaker 100:06:15Yes. Good morning, Paul, and thanks for the question. We're seeing more entrants coming into the market. We continue to see Citizens as a competitive carrier in the state. I think we continue to lean on particular markets where we are open that we feel are profitable. Speaker 100:06:34We've opened additional ones at the end of 2023 and we feel good where we sit today with the business that's coming in. From a rate perspective, it's always a combination of carrier and rate And I think our agency force feels very confident in Universal's ability to support their books of business as well as their insured. So I think our relationships, our rates and the markets that we're open in are serving as well. From a competitive perspective, we see some people doing things that we don't want to do and we don't feel bad about the business going elsewhere, so to say. We also have seen our retention improve quarter over quarter and we feel good about that flowing through the book as well right now. Speaker 100:07:21I don't know if you have anything more specific than that, but I'd be happy to answer anything further if you'd like. Speaker 400:07:28No, that's helpful and interesting. I've heard thoughts and talk of regulatory pressure for pricing because of the tort reform coming, they're not in so this year, but maybe next. But then I fear the other side too that it's been such a tough environment for so long that things will hold on for a long time. Where do you fall in that conversation? Do you see pressure building for sort of an offset for the tort reform? Speaker 400:08:09You do hear people talk about concerns about the affordability of policies just in and of themselves in Florida, the impact that may have on what the regulators want to do? Speaker 100:08:24Yes. There's a lot in that question unpack Paul. I think from affordability perspective that is an issue across the state of Florida right now. And certain segments of the market continue to go to the E and S market where rates are extremely high. We traditionally even in 2023, we looked at our rate indication and we took less as a submitted rate request as a result of the tort reform because we felt good about what was coming through the book. Speaker 100:08:59We're just kicking off our rate analysis as we speak for 2024. And when we get the final figures in, we'll take a look at that and try and do what's best for the market, for ourselves, for our shareholders and for our insurers and try and do the right thing. When you talk about pressures, I think the state of Florida has done a very good job with Torture reform and we're appreciative of that. Could they have gone a little further perhaps? Did they go too far? Speaker 100:09:30I don't think so. So I think as we look in the future, we'll try and take all those measures into account and do the right thing. But we don't feel there's nobody calling or suggesting anything to us that we're not getting any undue pressure so to say at this point. Speaker 400:09:49Fantastic. Congrats on the quarter. Speaker 100:09:52Yes. Thanks, Paul. Have a great day. Speaker 300:09:55Thank you. One moment for next question. Our next question comes from the line of Nick Acabiello of Dowling. Your line is now open. Speaker 500:10:16Thanks guys. Nice quarter. I was just wondering, first off, was there any net prior year development recognized in Speaker 200:10:26Q1? Nothing on a net basis, negligible on a direct. Speaker 500:10:33Got it. Thank you. And I know we'll get more details towards the end of May, but I was just wondering on the comment on the reinsurance program being fully supported and secured. Does that currently assume a similar GAAP retention as the program placed last year? Speaker 100:10:51Yes. If you're referring to the use of the isosceles, yes, that would be consistent with last year. We feel as though that was the right thing to do based on cost and capital utilization from the parent. So, yes. Speaker 500:11:05Okay. Makes sense. Thank you. That's all I had. Speaker 100:11:09Thanks, Nick. Have a good day. Speaker 300:11:23Thank you. This concludes the question and answer session. I would now like to turn it back to Steve Domenge, CEO for closing remarks. Speaker 100:11:32Thank you. I'd like to thank our associates, our consumers, agents and our stakeholders for their continued support of Universal. Wish you all a great day. Thank you. Speaker 300:11:44Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.Read morePowered by