Enact Holdings, Inc. · NASDAQ:ACT
Enact — Q1 2025 Earnings Presentation
21 slides from Enact's earnings presentation, May 1, 2025
Slide 1: First Quarter 2025 Financial Results
First Quarter 2025 Financial Results April 30, 2025
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements This communication contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, our expected financial and operational results, the rela
Slide 3: First Quarter Key Takeaways
First Quarter Key Takeaways Insurance in-force was $268B, driven by NIW of $10B and persistency of 84% Reserve release of $47M during the quarter driven by sustained favorable cure performance and our loss mitigation efforts New $350M share buyback program announced and increased quarterly dividend
Slide 4: About Us
About Us Vision: We enable the dream of homeownership MISSION: We help through industry leading customer experience from people buy a house quote to claim, best-in-class risk management, and and keep it their home a diverse team empowered to ACT! Drive Profitable Growth in Transform MI Business to G
Slide 5: Financial Highlights
Financial Highlights enactmi.com Primary Insurance in-Force Down $1B Q/Q $268 New Insurance Written Down 26% Q/Q $9.8 Net Premiums Earned Flat Q/Q $245 billion billion million Net Income Up 2% Q/Q $166 Adjusted Operating Income1 $169 Net Investment Income Flat Q/Q $63 million Flat Q/Q million millio
Slide 6: Driving Continued Book Value Accretion
Driving Continued Book Value Accretion enactmi.com 1 Book value per share excluding AOCI + cumulative dividends 6 1 Book value per share excluding Accumulated Other Comprehensive Income “AOCI” is a non-GAAP measure. Please see appendix for a reconciliation
Slide 7: Market and Industry Dynamics
Market and Industry Dynamics enactmi.com Complex market with favorable Industry well positioned to navigate underpinnings a range of economic scenarios » Housing market remains slow in the near-term » High quality credit portfolio and strong given low affordability manufacturing quality » Tight hous
Slide 8: Strong & Comprehensive Risk Management
Strong & Comprehensive Risk Management enactmi.com 1 FICO at Origination (Risk in-force “RIF”) Significant decrease in layered risk # of High-Risk 4Q07 1Q24 2Q24 3Q24 4Q24 1Q25 Layers2 LTV > +0 4.6% 0.6% 0.6% 0.6% 0.6% 0.6% 95% +1 7.9% 0.6% 0.6% 0.6% 0.6% 0.6% & +2 2.5% 0.1% 0.1% 0.1% 0.1% 0.1% FICO
Slide 9: Primary Insurance in-Force (IIF) Growth
Primary Insurance in-Force (IIF) Growth enactmi.com 1, 2 NIW ($B), IIF ($B) and Persistency Rate Mortgage Rate IIF Concentration 8% >7.2% (Avg Mar Market Rate + 50bps buffer) 65% 1Q25 » NIW down 26% sequentially primarily from seasonality » 8% of our IIF had mortgage rates at least 50 basis points o
Slide 10: Portfolio Premium Yield & Premiums
Portfolio Premium Yield & Premiums enactmi.com 1 In-Force Primary Portfolio Premium Yield Primary Direct & Ceded Premiums ($M) 1Q24 2Q24 3Q24 4Q24 1Q25 Base Premium Rate (bps) 40.1 40.3 40.2 40.0 40.1 Single Cancellations 0.2 0.2 0.4 0.3 0.1 Ceded Premium (4.0) (4.1) (4.3) (4.8) (4.9) Net Premium Ra
Slide 11: Strong Credit Performance
Strong Credit Performance enactmi.com Primary New Delinquencies1 Primary Cure Activity1 2 4 3 Remaining 1,167 1,777 3,095 4,992 8,073 Total Delqs 19,492 19,051 21,027 23,566 22,349 Delqs Cumulative 89% 83% 76% 64% 34% Delq Rate 2.0% 2.0% 2.2% 2.4% 2.3% Cure Rate » New delinquencies and rate decrease
Slide 12: Losses
Losses enactmi.com Losses ($M) & Loss Ratio Highlights » 1Q25 reserve release of $47M from favorable cure performance and loss mitigation activities compares to reserve releases of $56M and $54M in 4Q24 and 1Q24, respectively » Sequential increase in losses and loss ratio primarily driven by lower r
Slide 13: Embedded Equity
Embedded Equity 1 enactmi.com Primary Portfolio Delinquent Policies 88% 93% » Cumulative HPA and continued tight supply supporting housing prices support cumulative equity across our portfolio » 93% of delinquent policies and 88% of all policies have at least 10% equity which has remained consistent
Slide 14: Continued Strong Capital Return and Low Leverage
Continued Strong Capital Return and Low Leverage enactmi.com GAAP Capital Position1 ($M) Highlights » Returned $94M to shareholders during the quarter, consisting of $28M quarterly dividend, and share repurchases totaling $66M (2.0M shares at an average price of $33.38) » Repurchased an additional $
Slide 15: Strong PMIERs Sufficiency
Strong PMIERs Sufficiency enactmi.com Sufficiency to PMIERs1, 2 ($M) PMIERs Credit by CRT Instrument » Operating leverage of 36% reflects successful execution of our well diversified CRT program in a complex market » Previously announced two XOL reinsurance transactions that will provide ~$225M and
Slide 16: Robust Statutory Capital
Robust Statutory Capital enactmi.com EMICO Policyholder Surplus & Statutory Capital Scheduled Contingency Reserve Release1 Year $M 2025 $307 2026 $342 2027 $359 2028 $384 2029 $441 2030 $510 2031 $522 2032 $508 2033 $492 Contingency 2034 $460 $4,140 $4,234 $4,281 $4,325 $4,370 Reserve Total $4,325 »
Slide 17: Strong and Diversified Ratings
Strong and Diversified Ratings enactmi.com Rating Date Updated EMICO1 EHI2 LT Debt3 EMIC-NC1 Enact Re1 Agency Rating / Outlook Rating / Outlook Rating / Outlook Rating / Outlook Rating / Outlook Outlook Upgraded Moody’s A3 / Positive Baa3 / Positive Baa3 / Stable - - March 2024 Initiated Enact Re S&
Slide 18: Highly Rated & Diversified Investment Portfolio
Highly Rated & Diversified Investment Portfolio enactmi.com $5.8B Investment Portfolio and $0.6B of Cash Equivalents Composition by asset class1 Composition by rating2 » Top 10 issuers comprise ~6% of portfolio » 98% of portfolio is investment grade » Book yield of 4.1% up 10bps versus prior quarter
Slide 19: Appendix
Appendix “Enact
Slide 20: Non-GAAP Measures
Non-GAAP Measures enactmi.com Use of Non-GAAP Measures This communication includes the non-GAAP financial measures entitled “adjusted operating income (loss)”, “adjusted operating income (loss) per share," and “adjusted operating return on equity." Adjusted operating income (loss) per share is deriv
Slide 21: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures enactmi.com Net Income to Adj Operating Income 1Q24 2Q24 3Q24 4Q24 2024 1Q25 Net Income $161 $184 $181 $163 $688 $166 Adjustments to Net Income: Net investment (gains) losses $7 $8 $1 $7 $23 $3 Costs associated with reorganization ($0) $3 $1 $0 $5 $1 (Gains) losse