NASDAQ$ACGL

Arch Capital Group Ltd. · Q3 2022 earnings

Q3 2022 earnings · · Investor relations

Briefing

Arch Capital reported mixed Q3 2022 results impacted by catastrophic losses, but also showed growth in premiums written and favorable prior year loss reserve development.

Arch Capital Group Ltd. reported a net income of $6.9 million, or $0.02 per share, for the third quarter of 2022, a significant decrease compared to $388.8 million, or $0.98 per share, for the same period in 2021. The results were impacted by pre-tax current accident year catastrophic losses of $550.8 million, primarily related to Hurricane Ian. However, the company saw growth in gross premiums written, net premiums written, and net premiums earned.

  • Net income available to Arch common shareholders was $6.9 million, or $0.02 per share, compared to $388.8 million, or $0.98 per share, for Q3 2021.
  • After-tax operating income available to Arch common shareholders was $106.0 million, or $0.28 per share, compared to $294.7 million, or $0.74 per share, for Q3 2021.
  • Pre-tax current accident year catastrophic losses for the Company’s insurance and reinsurance segments were $550.8 million, primarily related to Hurricane Ian.
  • Combined ratio excluding catastrophic activity and prior year development was 82.2%, compared to 80.1% for Q3 2021.

Headline financials

Total Revenue

$2.39B

Previous: $2.1B+13.6%
EPS (adj)

$0.28

Previous: $0.74-62.2%
Loss ratio

68.1%

Previous: 63.5%+7.2%
Combined ratio

97.3%

Previous: 91.4%+6.5%
Adj. combined ratio

82.2%

No prior period
Free Cash Flow

$17.1M

Previous: $420M-95.9%
Net Income

$17.1M

Previous: $420M-95.9%
Operating Income

-$76.4M

Previous: $294M-126.0%
Gross Profit

$256M

Previous: $569M-55.0%
Cash & Equivalents

$814M

Previous: $1.14B-28.5%
Total Assets

$46.3B

Previous: $44.8B+3.5%
Stock-Based Comp

$13.5M

Previous: $14.7M-8.3%

Revenue & EPS history

Arch Capital · Revenue · Quarterly

$2.39B

Q3 2022+13.6%vs Q3 2021
Beat estimate in 10 of 15 quarters(67%)
ActualEstimate

Revenue by segment

Arch Capital · $2.47B total across 3 segments · Q3 2022

  • Insurance
    $1.19B+26.4%
  • Reinsurance
    $1B+47.6%
  • Mortgage
    $282M-9.6%

Forward guidance

The document does not contain specific forward guidance. It includes a cautionary note regarding forward-looking statements, which are subject to risks and uncertainties.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2022

Historical avgQ3 2022

+0.4%

Avg return

Earnings day

+1.6%

Avg return

5 days after

+2.9%

Avg return

30 days after

53%

36 / 68 earnings

Positive

+6.5%

Q3 2023

Best reaction

-7.7%

Q2 2011

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-4.8%-3.5%-8.0%
Q4 2025+1.9%+2.4%-1.9%
Q3 2025-1.4%+0.4%+9.8%
Q1 2025-1.9%+0.2%+2.9%
Q4 2024-2.0%-3.6%-1.1%
Q3 2024-6.0%-9.4%-3.9%
Q2 2024-1.3%+1.7%+16.3%
Q1 2024+2.9%+3.9%+11.7%
Q4 2023+4.0%+2.4%+9.3%
Q3 2023+6.5%+5.1%+1.3%
Q2 2023-2.1%-4.5%-8.3%
Q1 2023+1.8%+4.6%-2.2%
Q4 2022+3.2%+5.6%-2.3%
Q3 2022+5.0%+16.8%+19.3%
Q2 2022-2.1%-1.7%+5.1%
Q1 2022+0.5%-1.4%+2.0%
Q4 2021-1.7%-3.7%-5.1%
Q3 2021-2.6%-1.3%-2.9%
Q2 2021-0.1%+1.8%+8.4%
Q1 2021-1.6%-1.1%-1.2%
Q4 2020+2.2%+2.9%+8.3%
Q3 2020+2.6%+8.4%+12.2%
Q2 2020+3.4%+2.8%+7.2%
Q1 2020+2.7%+12.3%+40.0%
Q4 2019+0.6%+1.9%-34.4%
Q3 2019+3.2%+2.8%+3.8%
Q2 2019+3.5%+1.4%+2.9%
Q1 2019+1.7%+2.6%+2.9%
Q4 2018+5.4%+3.9%+7.3%
Q3 2018+6.0%+4.7%+6.0%
Q2 2018-0.9%-1.3%+0.9%
Q1 2018-1.5%-1.6%-2.1%
Q4 2017+0.6%+3.4%-2.8%
Q3 2017-1.3%-2.1%-6.2%
Q2 2017-4.5%-1.9%-1.7%
Q1 2017+2.0%+1.4%-0.6%
Q4 2016+0.0%+1.1%+2.8%
Q3 2016-1.0%+0.2%+5.5%
Q2 2016+3.7%+4.9%+13.8%
Q1 2016-0.9%
Q4 2015+1.8%
Q3 2015+0.2%
Q2 2015+3.2%
Q1 2015+0.0%
Q4 2014+0.8%
Q3 2014-0.2%
Q2 2014+0.7%
Q1 2014-0.5%
Q4 2013+1.6%
Q3 2013+0.9%
Q2 2013+1.3%
Q1 2013+0.8%
Q4 2012-1.4%
Q3 2012-3.5%
Q2 2012-0.7%
Q1 2012+0.6%
Q4 2011+2.5%
Q3 2011-0.2%
Q2 2011-7.7%
Q1 2010+0.8%
Q1 2011+2.7%
Q4 2008+0.2%
Q4 2010+0.2%
Q3 2009-1.2%
Q3 2010-1.2%
Q2 2010-0.8%
Q2 2009-0.8%
Q4 2009-0.8%

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