NASDAQ$UFCS

United Fire Group Inc · Q2 2024 earnings

Q2 2024 earnings · · Investor relations

Briefing

Reported a net loss of $0.11 per diluted share and an adjusted operating loss of $0.07 per diluted share.

United Fire Group reported a consolidated net loss of $2.7 million, or $0.11 loss per diluted share, and a consolidated adjusted operating loss of $0.07 per diluted share for the second quarter of 2024. The results reflect progress in efforts to deliver improved performance through the strategic execution of the business plan, marked by premium growth, lower underlying loss ratio, neutral prior period development, and increased investment income.

  • Net loss of $2.7 million includes a $3.2 million pre-tax charge for an estimated contingent liability related to rating errors.
  • Net premiums written increased 9.0% to $326.1 million compared to the second quarter of 2023.
  • Net investment income increased 59.2% to $18.0 million compared to the second quarter of 2023.
  • GAAP combined ratio of 105.6% improved 27.4 points compared to the second quarter of 2023.

Headline financials

Total Revenue

$301M

Previous: $267M+12.8%
EPS

-$0.11

Previous: -$2.27+95.2%
Combined Ratio

105.6%

Previous: 132.9%-20.5%
Underlying Combined Ratio

94.4%

Previous: 99.1%-4.7%
Underlying Loss Ratio

58.9%

No prior period
Catastrophe Loss Ratio

11.2%

No prior period
Underwriting Expense Ratio

35.5%

No prior period
Net Loss Ratio

70.1%

No prior period
Net Investment Income

$18M

Previous: $11.3M+59.2%
Book Value Per Share

$30.80

No prior period
Adjusted Book Value Per Share

$33.64

No prior period
Net Written Premium

$326M

No prior period
Net Earned Premium

$288M

No prior period
Free Cash Flow

-$2.74M

Previous: -$56.4M+95.1%
Net Income

-$2.74M

Previous: -$56.4M+95.1%
Operating Income

-$69.4M

Previous: -$135M+48.4%
Gross Profit

-$33.2M

Previous: -$103M+67.6%
Stock-Based Comp

$1.56M

Previous: $1.1M+41.5%

Revenue & EPS history

United Fire Group · Revenue · Quarterly

$301M

Q2 2024+12.8%vs Q2 2023
Beat estimate in 11 of 15 quarters(73%)
ActualEstimate

Revenue by segment

United Fire Group · $222M total across 2 segments · Q3 2023

  • Commercial Lines
    $220M+1.7%
  • Personal Lines
    $1.62M+201.3%

Forward guidance

The improvements in underlying profitability were sufficient to generate positive adjusted operating income in the second quarter, excluding the impact of the rating adjustment. The company remains committed to continuing to drive improvements in its performance through strategic execution of its business plan during the second half of the year.

Tailwinds

  • Continued premium growth
  • Lower underlying loss ratio
  • Neutral prior period development
  • Increased investment income
  • Focus on effectively managing property catastrophe risk profile

Headwinds

  • Net loss includes a pre-tax charge for an estimated contingent liability related to rating errors.
  • Underwriting expense ratio increased due to investments in talent and technology.
  • Identified rating errors related to umbrella and general liability products.
  • Estimate of anticipated exposure for rating errors may change as additional information becomes available.
  • Fines, penalties or further refunds related to rating errors are reasonably possible, but the amount of such losses, if any, cannot be estimated at this time.

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 Q2 2024

Historical avgQ2 2024

-0.0%

Avg return

Earnings day

+1.1%

Avg return

5 days after

+2.4%

Avg return

30 days after

43%

28 / 65 earnings

Positive

+27.4%

Q3 2024

Best reaction

-14.6%

Q4 2016

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+8.0%+21.7%+13.4%
Q4 2025+7.2%+8.9%+2.0%
Q3 2025+14.7%+17.3%+13.0%
Q1 2025-4.6%-2.4%-0.7%
Q4 2024+2.2%+5.7%+16.2%
Q3 2024+27.4%+25.3%+62.4%
Q2 2024-9.4%-8.1%-1.6%
Q1 2024+1.4%+1.8%-8.8%
Q4 2023+12.0%+9.1%-2.6%
Q3 2023-2.5%-1.2%+5.4%
Q2 2023-3.2%-4.4%-8.5%
Q1 2023-10.1%-10.6%-14.0%
Q4 2022-6.4%+1.0%-7.9%
Q3 2022-4.3%+3.4%+6.9%
Q2 2022-13.8%-9.4%-9.6%
Q1 2022-2.3%-4.7%+4.4%
Q4 2021+26.2%+26.8%+23.7%
Q3 2021-3.9%-2.3%-4.1%
Q2 2021+3.9%+9.5%+3.4%
Q1 2021+7.0%+5.4%+1.3%
Q4 2020-2.6%-4.3%+12.9%
Q3 2020-7.7%+0.7%+12.7%
Q2 2020+4.4%+12.1%-4.7%
Q1 2020-0.9%-1.7%+15.7%
Q4 2019-0.0%-3.4%-31.1%
Q3 2019-4.7%-5.7%-7.6%
Q2 2019-10.2%-11.5%-12.3%
Q1 2019+6.6%+6.2%+9.0%
Q4 2018-8.9%-13.3%-21.3%
Q3 2018-8.3%-9.9%-2.3%
Q2 2018-11.9%-11.5%-9.8%
Q1 2018+3.5%+1.4%+13.7%
Q4 2017+8.0%+10.9%+18.9%
Q3 2017+1.4%+0.1%+0.1%
Q2 2017-1.4%-1.8%-5.6%
Q1 2017-0.9%-1.8%+0.9%
Q4 2016-14.6%-14.3%-10.0%
Q3 2016-3.3%-1.7%+15.2%
Q2 2016-0.3%+1.3%+3.6%
Q1 2016-11.7%
Q4 2015+8.2%
Q3 2015+8.3%
Q2 2015+3.0%
Q1 2015+0.7%
Q4 2014-1.6%
Q3 2014-3.9%
Q2 2014-0.8%
Q1 2014-2.0%
Q4 2013+9.4%
Q3 2013-9.6%
Q2 2013+4.9%
Q1 2013+2.1%
Q4 2012+0.8%
Q3 2012-5.3%
Q2 2012+14.3%
Q1 2011+0.8%
Q1 2012+1.8%
Q4 2009-0.7%
Q4 2011-0.7%
Q4 2010-0.7%
Q3 2010+1.8%
Q3 2011+1.8%
Q2 2011-8.7%
Q2 2010-8.7%
Q1 2010-1.6%

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