United Fire Group, Inc · NASDAQ:UFCS
United Fire — Q3 2023 Earnings Presentation
9 slides from United Fire's earnings presentation, Nov 2, 2023
Slide 1: Third Quarter 2023 Results
THIRD QUARTER 2023 RESULTS NOVEMBER 2, 2023
Slide 2: Safe harbor statement and non-GAAP measures
Safe harbor statement and non-GAAP measures This presentation may contain forward-looking statements about our operations, anticipated performance and other similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor under the Securities Act of 1933 and the Securitie
Slide 3: Highlights: Third quarter 2023
Highlights Third quarter 2023 ▪ Net income of $6.4 million, or $0.25 per diluted share and adjusted operating income of $0.31 per diluted share ▪ Net premiums written(1) of $247.7 million ▪ GAAP combined ratio of 102.1%, including an underlying loss ratio(2) of 60.5% and catastrophe loss ratio of 5.
Slide 4: Consolidated financial results
Financial results Consolidated financial results ▪ Net written premium growth slowed in Q3 ▪ Q3 2023 combined ratio of 102% with improved catastrophe losses and neutral prior year reserve development compared to Q3 2022 ▪ Higher interest rate environment sustainably improving net investment income v
Slide 5: P&C results
P&C results Results ▪ Net written premium growth slowed in Q3 ▪ Q3 underlying loss ratio includes 2 points of impact from a small number of large surety losses ▪ Expense ratio increased due to impact of surety reinsurance reinstatement premiums and conclusion of favorable 2022 impacts ▪ Q3 catastrop
Slide 6: P&C portfolio production
P&C portfolio production Net written premium ($M) ▪ Core commercial growth continued with all production metrics improved vs. Core Commercial Alternative Distribution Specialty Surety prior year $299 $300,000 $261 $273 $10 $25 ▪ Alternative distribution leveraging hard market to deliver diversifying
Slide 7: Core commercial lines production detail
Core commercial lines production detail New business & premium retention trend New Business ($M) Premium Retention ▪ New business remains strongly above prior year $60 90% 84% – Line of business mix consistent with expectations 81% 81% 77% – New business leverages cross-functional strengths $40 76%
Slide 8: Investment portfolio composition & quality
Investment portfolio Investment portfolio composition & quality Portfolio Composition Fixed Maturity Credit Rating ▪ Q3 invested assets of $1.8B, with 90% of assets in fixed Rating % of Portfolio income securities Equity 3% Other & Long- AAA 39% Term Partnerships 8% AA 27% ▪ High-quality portfolio w
Slide 9: Investment income
Investment income Results ▪ Q3 Net investment income increased vs. prior year on higher fixed maturity yields and improved LP valuation ▪ Fixed maturity new money yields increased to 5.6% in Q3 2023 ▪ In Q3 strategically reallocated ~$80M of public equities into fixed maturities improving stability