Everest Group, Ltd 8-K, filed Jul 31, 2024
Everest Group, Ltd. (EG)
8-K
2024-07-31
For: 2024-07-31
View Original
Added on
April 08, 2026
About this 8-K
Everest Group, Ltd filed this 8-K on July 31, 2024.
Items reported
- Item 2.02: Financial results
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction | (Commission | (IRS Employer | ||||||
| of incorporation) | File Number) | Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
Registrant’s telephone number, including area code 441 -295-0006
Not Applicable | ||
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Securities registered pursuant to Section 12(b) of the Act:
| Class | Trading Symbol(s) | Name of Exchange where registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 12(a) of the Exchange Act. ☐
ITEM 2.02 DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
On July 31, 2024, the registrant issued a news release announcing its second quarter 2024 results. A copy of that news release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
The news release furnished herewith contains information regarding the registrant’s operating income (loss). Operating income (loss) differs from net income (loss) attributable to Everest Group, Ltd., the most directly comparable generally accepted accounting principle financial measure, by the exclusion of net gains (losses) on investments and net foreign exchange income (expense). Management believes that presentation of operating income (loss) provides useful information to investors because it more accurately measures and predicts the registrant’s results of operations by removing the variability arising from both the management of the registrant’s investment portfolio and the fluctuations of foreign currency exchange rates. In addition, management, analysts and investors use operating income (loss) to evaluate the financial performance of the registrant and the insurance industry in general.
In accordance with general instruction B.2 of Form 8-K, the information in this report, including exhibits, is furnished pursuant to Item 2.02 and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that section.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
| (c) | Exhibits | ||||||||||
| Exhibit No. | Description | ||||||||||
| 99.1 | News Release of the registrant, dated July 31, 2024 | ||||||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| EVEREST GROUP, LTD. | ||||||||
| By: | /S/ ROBERT J. FREILING | |||||||
| Robert J. Freiling Senior Vice President and Chief Accounting Officer | ||||||||
Dated: July 31, 2024 | ||||||||
EXHIBIT INDEX
| Exhibit Number | Description of Document | Page No. | ||||||||||||
| 5 | ||||||||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document | |||||||||||||
| NEWS RELEASE |  | |||||||
| EVEREST GROUP, LTD. | ||||||||
Seon place, 141 Front Street, 4th Floor, Hamilton HM 19, Bermuda | ||||||||
| Contacts | ||||||||
| Media: Dawn Lauer | Investors: Matt Rohrmann | |||||||
| Chief Communications Officer | Head of Investor Relations | |||||||
| 908.300.7670 | 908.604.7343 | |||||||
Everest Reports Second Quarter 2024 Results
Net Income of $724 million and Operating Income of $730 million
Operating Income ROE of 19.7% and TSR1 of 20.0%
$358 million of Underwriting Income and Combined Ratio of 90.3%
HAMILTON, Bermuda – (BUSINESS WIRE) – July 31, 2024 – Everest Group, Ltd. (NYSE: EG), a global underwriting leader providing best-in-class property, casualty, and specialty reinsurance and insurance solutions, today reported its second quarter 2024 results.
Second Quarter 2024 Highlights
•Total Shareholder Return of 20.0% annualized; 19.6% Net Income ROE and 19.7% Operating Income ROE
•Net Income of $724 million; Operating Income of $730 million driven by attritional underwriting margin improvement and strong net investment income generation
•$4.7 billion in gross written premium with year-over-year growth of 12.8%2 for the Group, 16.5%2 for Reinsurance, and 5.8%2 for Insurance
•Combined ratios of 90.3% for the Group, 88.9% for Reinsurance and 94.4% for Insurance
•Attritional combined ratios of 86.6% for the Group, 84.4% for Reinsurance and 92.8% for Insurance
•Pre-tax underwriting income of $358 million for the Group, $303 million for Reinsurance, and $54 million for Insurance
•$135 million of pre-tax catastrophe losses net of recoveries and reinstatement premiums versus $27 million in the prior year
•Net investment income improved to $528 million versus $357 million in the prior year second quarter, a company record, driven by a larger asset base as well as strong core fixed income and alternative investment returns
•Strong operating cashflow for the quarter of $1.3 billion versus $1.1 billion in the second quarter 2023
Footnote 1 denotes annualized figure; represents Total Shareholder Return or "TSR"
Footnote 2 denotes constant currency figure and excludes reinstatement premiums
1
“Everest produced another strong quarter and an excellent first half of the year, with second quarter results delivering an annualized Total Shareholder Return and operating ROE of 20%, driven by solid underwriting and net investment income,” said Juan C. Andrade, Everest President and CEO. "The fundamentals of our business are robust, creating significant momentum as we expand in areas with the strongest profit trajectory, while remaining focused on disciplined underwriting and risk selection. Our leading Reinsurance business continues to achieve excellent risk adjusted returns, again evidenced by our success through the most recent renewals. We made progress advancing our primary insurance strategy in key global markets, investing in, and expanding our platform with exceptional talent and capabilities to capitalize on market opportunities. As we move through the second half of 2024, we are capitalizing on this momentum, focused on achieving our primary objective of consistently generating industry leading returns.”
Summary of Second Quarter 2024 Net Income and Other Items
•Net income of $724 million, equal to $16.70 per diluted share versus second quarter 2023 net income of $670 million, equal to $16.26 per diluted share
•Net operating income of $730 million, equal to $16.85 per diluted share versus second quarter 2023 net operating income of $627 million, equal to $15.21 per diluted share
•GAAP combined ratio of 90.3%, including 4.1 points of catastrophe losses, versus the second quarter 2023 figure of 87.7%, including 0.8 points of catastrophe losses
The following table summarizes the Company’s Net Income and related financial metrics.
| Net income and operating income | Q2 | Year to Date | Q2 | Year to Date | |||||||||||||||||||
| All values in USD millions except for per share amounts and percentages | 2024 | 2024 | 2023 | 2023 | |||||||||||||||||||
| Everest Group | |||||||||||||||||||||||
| Net income (loss) | 724 | 1,457 | 670 | 1,035 | |||||||||||||||||||
Net operating income (loss) (1) | 730 | 1,439 | 627 | 1,070 | |||||||||||||||||||
| Net income (loss) per diluted common share | 16.70 | 33.57 | 16.26 | 25.74 | |||||||||||||||||||
| Net operating income (loss) per diluted common share | 16.85 | 33.17 | 15.21 | 26.61 | |||||||||||||||||||
| Net income (loss) return on average equity (annualized) | 19.6% | 20.1% | 23.3% | 18.3% | |||||||||||||||||||
| After-tax operating income (loss) return on average equity (annualized) | 19.7% | 19.8% | 21.8% | 18.9% | |||||||||||||||||||
Notes
(1) Refer to the reconciliation of net income to net operating income found on page 8 of this press release
2
| Shareholders' Equity and Book Value per Share | Q2 | Year to Date | Q2 | Year to Date | |||||||||||||||||||
| All values in USD millions except for per share amounts and percentages | 2024 | 2024 | 2023 | 2023 | |||||||||||||||||||
| Beginning shareholders' equity | 13,628 | 13,202 | 9,014 | 8,441 | |||||||||||||||||||
| Net income (loss) | 724 | 1,457 | 670 | 1,035 | |||||||||||||||||||
| Change - unrealized gains (losses) - Fixed inc. investments | (60) | (213) | (167) | 82 | |||||||||||||||||||
| Dividends to shareholders | (86) | (163) | (72) | (136) | |||||||||||||||||||
| Purchase of treasury shares | (65) | (100) | — | — | |||||||||||||||||||
| Public equity offering of shares | — | — | 1,445 | 1,445 | |||||||||||||||||||
| Other | 41 | (1) | 11 | 36 | |||||||||||||||||||
| Ending shareholders' equity | 14,182 | 14,182 | 10,902 | 10,902 | |||||||||||||||||||
| Common shares outstanding | 43.3 | 43.4 | |||||||||||||||||||||
| Book value per common share outstanding | 327.68 | 251.17 | |||||||||||||||||||||
| Less: Unrealized appreciation/depreciation of fixed maturity investments ("URAD") | (21.62) | (37.47) | |||||||||||||||||||||
| Adjusted book value per common share outstanding excluding URAD | 349.30 | 288.64 | |||||||||||||||||||||
| Change in BVPS adjusted for dividends | 8.9% | 18.1% | |||||||||||||||||||||
| Total Shareholder Return ("TSR") - Annualized | 20.0% | 25.3% | |||||||||||||||||||||
| Common share dividends paid - last 12 months | 7.25 | 6.60 | |||||||||||||||||||||
3
The following information summarizes the Company’s underwriting results, on a consolidated basis and by segment – Reinsurance and Insurance, with selected commentary on results by segment.
| Underwriting information - Everest Group | Q2 | Year to Date | Q2 | Year to Date | Year on Year Change | ||||||||||||||||||||||||||||||
| All values in USD millions except for percentages | 2024 | 2024 | 2023 | 2023 | Q2 | Year to Date | |||||||||||||||||||||||||||||
| Gross written premium | 4,725 | 9,136 | 4,180 | 7,923 | 13.0% | 15.3% | |||||||||||||||||||||||||||||
| Net written premium | 4,084 | 7,984 | 3,674 | 7,003 | 11.2% | 14.0% | |||||||||||||||||||||||||||||
| Loss Ratio: | |||||||||||||||||||||||||||||||||||
| Current year | 58.5% | 58.7% | 59.5% | 59.6% | (1.0) pts | (0.9) pts | |||||||||||||||||||||||||||||
| Prior year | —% | —% | —% | —% | — pts | — pts | |||||||||||||||||||||||||||||
| Catastrophe | 4.1% | 3.2% | 0.8% | 2.2% | 3.3 pts | 1.0 pts | |||||||||||||||||||||||||||||
| Total Loss ratio | 62.6% | 61.9% | 60.3% | 61.8% | 2.3 pts | 0.1 pts | |||||||||||||||||||||||||||||
| Commission and brokerage ratio | 21.4% | 21.4% | 21.1% | 21.2% | 0.3 pts | 0.2 pts | |||||||||||||||||||||||||||||
| Other underwriting expenses | 6.3% | 6.2% | 6.3% | 6.4% | — pts | (0.1) pts | |||||||||||||||||||||||||||||
| Combined ratio | 90.3% | 89.6% | 87.7% | 89.4% | 2.6 pts | 0.2 pts | |||||||||||||||||||||||||||||
Attritional combined ratio (1) | 86.6% | 86.5% | 86.8% | 87.2% | (0.2) pts | (0.7) pts | |||||||||||||||||||||||||||||
Pre-tax net catastrophe losses (2) | 135 | 220 | 27 | 137 | |||||||||||||||||||||||||||||||
| Pre-tax net unfavorable (favorable) prior year reserve development | — | — | — | — | |||||||||||||||||||||||||||||||
Notes
(1) Attritional ratios exclude catastrophe losses, net CAT reinstatement premiums earned, prior year development, COVID-19 losses and losses from the Russia/Ukraine war.
(2) Pre-tax net catastrophe losses are net of reinsurance and reinstatement premiums
4
Reinsurance Segment – Quarterly Highlights
•Gross written premiums grew 16.5% on a constant dollar basis and excluding reinstatement premiums, to approximately $3.2 billion. Growth was broad-based across geographies and lines as we continue to execute with precision and leverage our leading franchise.
•Growth was driven by a 31.4% increase in Property Pro-Rata, 25.0% in Property Catastrophe XOL, and 19.6% in Casualty Pro-Rata (driven by increased rate), when adjusting for reinstatement premiums
•Attritional loss ratio improved 60 basis points over last year to 57.0%, while the attritional combined ratio improved 30 basis points to 84.4% versus a year ago.
•Pre-tax catastrophe losses were $120 million net of estimated recoveries and reinstatement premiums, driven primarily by a number of mid-sized international events.
•Risk-adjusted returns remain very attractive, particularly in property and specialty lines.
| Underwriting information - Reinsurance segment | Q2 | Year to Date | Q2 | Year to Date | Year on Year Change | ||||||||||||||||||||||||||||||
| All values in USD millions except for percentages | 2024 | 2024 | 2023 | 2023 | Q2 | Year to Date | |||||||||||||||||||||||||||||
| Gross written premium | 3,209 | 6,385 | 2,747 | 5,368 | 16.8% | 18.9% | |||||||||||||||||||||||||||||
| Net written premium | 3,033 | 5,975 | 2,621 | 5,059 | 15.7% | 18.1% | |||||||||||||||||||||||||||||
| Loss Ratio: | |||||||||||||||||||||||||||||||||||
| Current year | 56.7% | 56.9% | 57.6% | 57.7% | (0.9) pts | (0.8) pts | |||||||||||||||||||||||||||||
| Prior year | —% | —% | —% | —% | — pts | — pts | |||||||||||||||||||||||||||||
| Catastrophe | 5.0% | 4.0% | 1.2% | 3.1% | 3.8 pts | 0.9 pts | |||||||||||||||||||||||||||||
| Total Loss ratio | 61.7% | 60.9% | 58.8% | 60.8% | 2.9 pts | 0.1 pts | |||||||||||||||||||||||||||||
| Commission and brokerage ratio | 24.6% | 24.6% | 24.5% | 24.7% | 0.1 pts | (0.1) pts | |||||||||||||||||||||||||||||
| Other underwriting expenses | 2.6% | 2.6% | 2.6% | 2.7% | — pts | (0.1) pts | |||||||||||||||||||||||||||||
| Combined ratio | 88.9% | 88.1% | 85.8% | 88.2% | 3.1 pts | (0.1) pts | |||||||||||||||||||||||||||||
Attritional combined ratio (1) | 84.4% | 84.4% | 84.7% | 85.3% | (0.3) pts | (0.9) pts | |||||||||||||||||||||||||||||
Pre-tax net catastrophe losses (2) | 120 | 200 | 27 | 135 | |||||||||||||||||||||||||||||||
| Pre-tax net prior year reserve development | — | — | — | — | |||||||||||||||||||||||||||||||
Notes
(1) Attritional ratios exclude catastrophe losses, net CAT reinstatement premiums earned, prior year development, COVID-19 losses and losses from the Russia/Ukraine war.
(2) Pre-tax net catastrophe losses are net of reinsurance and reinstatement premiums
5
Insurance Segment – Quarterly Highlights
•Gross written premiums rose to $1.5 billion, a 5.8% increase year-over-year in constant dollars. Our International business continued to gain traction, and we received regulatory approval for new operations in Australia, Colombia, and Mexico.
•As we continue to proactively change our mix of business, growth was driven by a 31.1% increase in Property/Short Tail and 26.0% in Other Specialty, led by growth in aviation, energy, surety, and construction. Growth was partially offset by a decrease of 37.4% in Accident and Health and 18.0% in Workers' Compensation as we continue to focus on lines of business with better expected margins.
•Attritional loss ratio improved 70 basis points over last year to 63.7%.
•Pre-tax catastrophe losses were $15 million, net of estimated recoveries and reinstatement premiums, a modest increase over the prior year quarter, which benefited from benign catastrophe losses.
•Pricing continues to exceed loss trend in aggregate.
•There was a meaningful acceleration in pricing across North American long-tail lines (excluding financial lines).
| Underwriting information - Insurance segment | Q2 | Year to Date | Q2 | Year to Date | Year on Year Change | ||||||||||||||||||||||||||||||
| All values in USD millions except for percentages | 2024 | 2024 | 2023 | 2023 | Q2 | Year to Date | |||||||||||||||||||||||||||||
| Gross written premium | 1,515 | 2,752 | 1,433 | 2,555 | 5.7% | 7.7% | |||||||||||||||||||||||||||||
| Net written premium | 1,051 | 2,009 | 1,053 | 1,944 | (0.2)% | 3.3% | |||||||||||||||||||||||||||||
| Loss Ratio: | |||||||||||||||||||||||||||||||||||
| Current year | 63.7% | 63.8% | 64.4% | 64.4% | (0.7) pts | (0.6) pts | |||||||||||||||||||||||||||||
| Prior year | —% | —% | —% | —% | — pts | — pts | |||||||||||||||||||||||||||||
| Catastrophe | 1.5% | 1.0% | —% | 0.1% | 1.5 pts | 0.9 pts | |||||||||||||||||||||||||||||
| Total Loss ratio | 65.3% | 64.9% | 64.4% | 64.5% | 0.9 pts | 0.4 pts | |||||||||||||||||||||||||||||
| Commission and brokerage ratio | 12.2% | 12.1% | 12.1% | 12.0% | 0.1 pts | 0.1 pts | |||||||||||||||||||||||||||||
| Other underwriting expenses | 16.9% | 16.7% | 16.2% | 15.9% | 0.7 pts | 0.8 pts | |||||||||||||||||||||||||||||
| Combined ratio | 94.4% | 93.7% | 92.6% | 92.4% | 1.8 pts | 1.3 pts | |||||||||||||||||||||||||||||
Attritional combined ratio (1) | 92.8% | 92.7% | 92.6% | 92.3% | 0.2 pts | 0.4 pts | |||||||||||||||||||||||||||||
Pre-tax net catastrophe losses (2) | 15 | 20 | — | 2 | |||||||||||||||||||||||||||||||
| Pre-tax net prior year reserve development | — | — | — | — | |||||||||||||||||||||||||||||||
Notes
(1) Attritional ratios exclude catastrophe losses, net CAT reinstatement premiums earned, prior year development, COVID-19 losses and losses from the Russia/Ukraine war.
(2) Pre-tax net catastrophe losses are net of reinsurance and reinstatement premiums
6
Investments and Shareholders’ Equity as of June 30, 2024
•Total invested assets and cash of $39.1 billion versus $37.1 billion on December 31, 2023
•Shareholders’ equity of $14.2 billion vs. $13.2 billion on December 31, 2023, including $936 million of unrealized net losses on AFS fixed maturity investments
•Shareholders’ equity excluding unrealized gains (losses) on AFS fixed maturity investments of $15.1 billion versus $13.9 billion on December 31, 2023
•Book value per share of $327.68 versus $304.29 at December 31, 2023
•Book value per share excluding unrealized gains (losses) on AFS fixed maturity investments of $349.30 versus $320.95 at December 31, 2023
•Common share repurchases of $65.0 million during the quarter, representing 173,718 shares at an average price of $374.17 per share
•Common share dividends declared and paid in the quarter of $2.00 per share equal to $86 million
This news release contains forward-looking statements within the meaning of the U.S. federal securities laws. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the U.S. federal securities laws. These statements reflect management’s current expectations based on assumptions we believe are reasonable but are not guarantees of performance. Actual results may differ materially from those contained in forward-looking statements made on behalf of the Company. The forward-looking statements involve risks and uncertainties that include, but are not limited to, the impact of general economic conditions and conditions affecting the insurance and reinsurance industry, the adequacy of our reserves, our ability to assess underwriting risk, trends in rates for property and casualty insurance and reinsurance, competition, investment market and investment income fluctuations, trends in insured and paid losses, catastrophes, pandemic, regulatory and legal uncertainties and other factors described in our SEC filings, including our latest Annual Report on Form 10-K. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
About Everest
Everest Group, Ltd. (Everest) is a global underwriting leader providing best-in-class property, casualty, and specialty reinsurance and insurance solutions that address customers’ most pressing challenges. Known for a 50-year track record of disciplined underwriting, capital and risk management, Everest, through its global operating affiliates, is committed to underwriting opportunity for colleagues, customers, shareholders, and communities worldwide.
Everest common stock (NYSE: EG) is a component of the S&P 500 index.
Additional information about Everest, our people, and our products can be found on our website at www.everestglobal.com.
A conference call discussing the results will be held at 8:00 a.m. Eastern Time on August 1, 2024. The call will be available on the Internet through the Company’s website at https://www.everestglobal.com/investor-relations.
Recipients are encouraged to visit the Company’s website to view supplemental financial information on the Company’s results. The supplemental information is located at www.everestglobal.com in the “Investors/Financials/Quarterly Results” section of the website. The supplemental financial information may also be obtained by contacting the Company directly.
_______________________________________________
7
The Company generally uses after-tax operating income (loss), a non-GAAP financial measure, to evaluate its performance. After-tax operating income (loss) consists of net income (loss) excluding after-tax net gains (losses) on investments and after-tax net foreign exchange income (expense) as the following reconciliation displays:
| (Dollars in millions, except per share amounts) | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||||||||||||||||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
| Amount | Per Diluted Share | Amount | Per Diluted Share | Amount | Per Diluted Share | Amount | Per Diluted Share | ||||||||||||||||||||||||||||||||||||||||
| After-tax net operating income (loss) | $ | 730 | $ | 16.85 | $ | 627 | $ | 15.21 | $ | 1,439 | $ | 33.17 | $ | 1,070 | $ | 26.61 | |||||||||||||||||||||||||||||||
| After-tax net gains (losses) on investments | (14) | (0.32) | 4 | 0.11 | (20) | (0.45) | 10 | 0.25 | |||||||||||||||||||||||||||||||||||||||
| After-tax net foreign exchange income (expense) | 7 | 0.17 | 39 | 0.94 | 37 | 0.86 | (45) | (1.12) | |||||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 724 | $ | 16.70 | $ | 670 | $ | 16.26 | $ | 1,457 | $ | 33.57 | $ | 1,035 | $ | 25.74 | |||||||||||||||||||||||||||||||
| (Some amounts may not reconcile due to rounding.) | |||||||||||||||||||||||||||||||||||||||||||||||
Although net gains (losses) on investments and net foreign exchange income (expense) are an integral part of the Company’s insurance operations, the determination of net gains (losses) on investments and foreign exchange income (expense) is independent of the insurance underwriting process. The Company believes that the level of net gains (losses) on investments and net foreign exchange income (expense) for any particular period are not indicative of the performance of the underlying business in that particular period. Providing only a GAAP presentation of net income (loss) makes it more difficult for users of the financial information to evaluate the Company’s success or failure in its basic business and may lead to incorrect or misleading assumptions and conclusions. The Company understands that the equity analysts who follow the Company focus on after-tax operating income (loss) in their analyses for the reasons discussed above. The Company provides after-tax operating income (loss) to investors so that they have what management believes to be a useful supplement to GAAP information concerning the Company’s performance.
--Financial Details Follow--
8
EVEREST GROUP, LTD.
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| (In millions of U.S. dollars, except per share amounts) | 2024 | 2023 | 2024 | 2023 | |||||||||||||||||||
| (unaudited) | (unaudited) | ||||||||||||||||||||||
| REVENUES: | |||||||||||||||||||||||
| Premiums earned | $ | 3,693 | $ | 3,251 | $ | 7,345 | $ | 6,352 | |||||||||||||||
| Net investment income | 528 | 357 | 985 | 617 | |||||||||||||||||||
| Net gains (losses) on investments | (17) | 5 | (24) | 10 | |||||||||||||||||||
| Other income (expense) | 23 | 38 | 54 | (42) | |||||||||||||||||||
| Total revenues | 4,227 | 3,650 | 8,360 | 6,936 | |||||||||||||||||||
| CLAIMS AND EXPENSES: | |||||||||||||||||||||||
| Incurred losses and loss adjustment expenses | 2,311 | 1,960 | 4,548 | 3,927 | |||||||||||||||||||
| Commission, brokerage, taxes and fees | 790 | 686 | 1,571 | 1,347 | |||||||||||||||||||
| Other underwriting expenses | 234 | 205 | 458 | 405 | |||||||||||||||||||
| Corporate expenses | 22 | 17 | 44 | 36 | |||||||||||||||||||
| Interest, fees and bond issue cost amortization expense | 37 | 33 | 75 | 65 | |||||||||||||||||||
| Total claims and expenses | 3,395 | 2,901 | 6,696 | 5,779 | |||||||||||||||||||
| INCOME (LOSS) BEFORE TAXES | 832 | 750 | 1,664 | 1,157 | |||||||||||||||||||
| Income tax expense (benefit) | 108 | 80 | 207 | 122 | |||||||||||||||||||
| NET INCOME (LOSS) | $ | 724 | $ | 670 | $ | 1,457 | $ | 1,035 | |||||||||||||||
| Other comprehensive income (loss), net of tax: | |||||||||||||||||||||||
| Unrealized appreciation (depreciation) ("URA(D)") on securities arising during the period | (70) | (169) | (227) | 77 | |||||||||||||||||||
| Reclassification adjustment for realized losses (gains) included in net income (loss) | 9 | 2 | 14 | 5 | |||||||||||||||||||
| Total URA(D) on securities arising during the period | (60) | (167) | (213) | 82 | |||||||||||||||||||
| Foreign currency translation adjustments | — | (1) | (38) | 30 | |||||||||||||||||||
| Reclassification adjustment for amortization of net (gain) loss included in net income (loss) | 24 | — | 25 | 1 | |||||||||||||||||||
| Total benefit plan net gain (loss) for the period | 24 | — | 25 | 1 | |||||||||||||||||||
| Total other comprehensive income (loss), net of tax | (36) | (168) | (227) | 113 | |||||||||||||||||||
| COMPREHENSIVE INCOME (LOSS) | $ | 688 | $ | 502 | $ | 1,230 | $ | 1,148 | |||||||||||||||
| EARNINGS PER COMMON SHARE: | |||||||||||||||||||||||
| Basic | $ | 16.70 | $ | 16.26 | $ | 33.57 | $ | 25.74 | |||||||||||||||
| Diluted | 16.70 | 16.26 | 33.57 | 25.74 | |||||||||||||||||||
9
EVEREST GROUP, LTD.
CONSOLIDATED BALANCE SHEETS
| June 30, | December 31, | ||||||||||
| (In millions of U.S. dollars, except par value per share) | 2024 | 2023 | |||||||||
| (unaudited) | |||||||||||
| ASSETS: | |||||||||||
| Fixed maturities - available for sale, at fair value | |||||||||||
| (amortized cost: 2024, $30,134; 2023, $28,568, credit allowances: 2024, $(42); 2023, $(48)) | $ | 29,031 | $ | 27,740 | |||||||
| Fixed maturities - held to maturity, at amortized cost | |||||||||||
| (fair value: 2024, $788; 2023, $854, net of credit allowances: 2024, $(8); 2023, $(8)) | 787 | 855 | |||||||||
| Equity securities, at fair value | 219 | 188 | |||||||||
| Other invested assets | 4,994 | 4,794 | |||||||||
| Short-term investments | 2,464 | 2,127 | |||||||||
| Cash | 1,570 | 1,437 | |||||||||
| Total investments and cash | 39,065 | 37,142 | |||||||||
| Accrued investment income | 360 | 324 | |||||||||
| Premiums receivable (net of credit allowances: 2024, $(45); 2023, $(41)) | 5,403 | 4,768 | |||||||||
| Reinsurance paid loss recoverables (net of credit allowances: 2024, $(29); 2023, $(26)) | 254 | 164 | |||||||||
| Reinsurance unpaid loss recoverables | 2,151 | 2,098 | |||||||||
| Funds held by reinsureds | 1,189 | 1,135 | |||||||||
| Deferred acquisition costs | 1,422 | 1,247 | |||||||||
| Prepaid reinsurance premiums | 806 | 713 | |||||||||
| Income tax asset, net | 927 | 868 | |||||||||
| Other assets (net of credit allowances: 2024, $(9); 2023, $(9)) | 983 | 941 | |||||||||
| TOTAL ASSETS | $ | 52,560 | $ | 49,399 | |||||||
| LIABILITIES: | |||||||||||
| Reserve for losses and loss adjustment expenses | 25,853 | 24,604 | |||||||||
| Unearned premium reserve | 7,313 | 6,622 | |||||||||
| Funds held under reinsurance treaties | 13 | 24 | |||||||||
| Amounts due to reinsurers | 869 | 650 | |||||||||
| Losses in course of payment | 289 | 171 | |||||||||
| Senior notes | 2,349 | 2,349 | |||||||||
| Long-term notes | 218 | 218 | |||||||||
| Borrowings from FHLB | 819 | 819 | |||||||||
| Accrued interest on debt and borrowings | 22 | 22 | |||||||||
| Unsettled securities payable | 175 | 137 | |||||||||
| Other liabilities | 458 | 582 | |||||||||
| Total liabilities | 38,378 | 36,197 | |||||||||
| SHAREHOLDERS' EQUITY: | |||||||||||
| Preferred shares, par value: $0.01; 50.0 shares authorized; no shares issued and outstanding | — | — | |||||||||
| Common shares, par value: $0.01; 200.0 shares authorized; (2024) 74.3 and (2023) 74.2 | |||||||||||
| outstanding before treasury shares | 1 | 1 | |||||||||
| Additional paid-in capital | 3,785 | 3,773 | |||||||||
| Accumulated other comprehensive income (loss), net of deferred income tax expense (benefit) | |||||||||||
| of $(162) at 2024 and $(99) at 2023 | (1,160) | (934) | |||||||||
| Treasury shares, at cost; 31.0 shares (2024) and 30.8 shares (2023) | (4,008) | (3,908) | |||||||||
| Retained earnings | 15,565 | 14,270 | |||||||||
| Total shareholders' equity | 14,182 | 13,202 | |||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 52,560 | $ | 49,399 | |||||||
10
EVEREST GROUP, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
| Six Months Ended June 30, | |||||||||||
| (In millions of U.S. dollars) | 2024 | 2023 | |||||||||
| (unaudited) | |||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
| Net income (loss) | $ | 1,457 | $ | 1,035 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Decrease (increase) in premiums receivable | (685) | (584) | |||||||||
| Decrease (increase) in funds held by reinsureds, net | (66) | (5) | |||||||||
| Decrease (increase) in reinsurance recoverables | (236) | (21) | |||||||||
| Decrease (increase) in income taxes | 4 | 56 | |||||||||
| Decrease (increase) in prepaid reinsurance premiums | (130) | (40) | |||||||||
| Increase (decrease) in reserve for losses and loss adjustment expenses | 1,388 | 1,142 | |||||||||
| Increase (decrease) in unearned premiums | 744 | 732 | |||||||||
| Increase (decrease) in amounts due to reinsurers | 258 | 63 | |||||||||
| Increase (decrease) in losses in course of payment | 122 | 75 | |||||||||
| Change in equity adjustments in limited partnerships | (177) | (56) | |||||||||
| Distribution of limited partnership income | 60 | 49 | |||||||||
| Change in other assets and liabilities, net | (292) | (293) | |||||||||
| Non-cash compensation expense | 33 | 25 | |||||||||
| Amortization of bond premium (accrual of bond discount) | (65) | (11) | |||||||||
| Net (gains) losses on investments | 24 | (10) | |||||||||
| Net cash provided by (used in) operating activities | 2,439 | 2,158 | |||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
| Proceeds from fixed maturities matured/called/repaid - available for sale | 1,707 | 1,137 | |||||||||
| Proceeds from fixed maturities sold - available for sale | 1,085 | 168 | |||||||||
| Proceeds from fixed maturities matured/called/repaid - held to maturity | 109 | 61 | |||||||||
| Proceeds from equity securities sold | 15 | 46 | |||||||||
| Distributions from other invested assets | 209 | 133 | |||||||||
| Cost of fixed maturities acquired - available for sale | (4,475) | (3,396) | |||||||||
| Cost of fixed maturities acquired - held to maturity | (36) | (15) | |||||||||
| Cost of equity securities acquired | (35) | (3) | |||||||||
| Cost of other invested assets acquired | (314) | (298) | |||||||||
| Net change in short-term investments | (299) | (625) | |||||||||
| Net change in unsettled securities transactions | 18 | 41 | |||||||||
| Net cash provided by (used in) investing activities | (2,016) | (2,752) | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
| Common shares issued (redeemed) during the period for share-based compensation, net of expense | (21) | (19) | |||||||||
| Proceeds from public offering of common shares | — | 1,445 | |||||||||
| Purchase of treasury shares | (100) | — | |||||||||
| Dividends paid to shareholders | (163) | (136) | |||||||||
| Cost of shares withheld on settlements of share-based compensation awards | (21) | (20) | |||||||||
| Net cash provided by (used in) financing activities | (305) | 1,269 | |||||||||
| EFFECT OF EXCHANGE RATE CHANGES ON CASH | 14 | (7) | |||||||||
| Net increase (decrease) in cash | 133 | 668 | |||||||||
| Cash, beginning of period | 1,437 | 1,398 | |||||||||
| Cash, end of period | $ | 1,570 | $ | 2,067 | |||||||
| SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||||||
| Income taxes paid (recovered) | $ | 203 | $ | 73 | |||||||
| Interest paid | 74 | 64 | |||||||||
| NON-CASH TRANSACTIONS: | |||||||||||
| Non-cash limited partnership distribution | 23 | — | |||||||||
11