NYSE$WRB

W R Berkley Corporation · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

W. R. Berkley's Q3 2023 net income increased, driven by strong underwriting profits and record quarterly net investment income.

W. R. Berkley Corporation reported a 45.7% increase in net income to $334 million for the third quarter of 2023. The company's operating return on equity was 21.7%, and the return on equity was 19.8%. Record net investment income of $271 million was driven by a 59.3% increase in the core portfolio. Net premiums written grew 10.5% to $2.8 billion.

  • Operating return on equity and return on equity were 21.7% and 19.8%, respectively.
  • Net investment income reached a record $270.9 million, driven by a 59.3% increase in the core portfolio.
  • The current accident year combined ratio before catastrophe losses of 2.3 loss ratio points was 87.9%.
  • Net premiums written grew 10.5% to $2.8 billion.

Headline financials

Total Revenue

$3.03B

Previous: $2.72B+11.2%
EPS (adj)

$0.90

Previous: $0.67+34.3%
GAAP Combined ratio

90.2%

No prior period
Return on equity

19.8%

No prior period
Operating return on equity

21.7%

Previous: 16.9%+28.4%
Average rate increases excluding workers' compensation

8.5%

No prior period
Free Cash Flow

$334M

Previous: $229M+45.7%
Net Income

$334M

Previous: $229M+45.7%
Operating Income

-$1.22B

Previous: -$1.28B+4.9%
Gross Profit

$420M

Previous: $286M+46.7%
Cash & Equivalents

$2.04B

Previous: $1.13B+80.0%
Total Assets

$36.1B

Previous: $33.1B+9.2%
Stock-Based Comp

$12.7M

Previous: $12.1M+5.1%

Revenue & EPS history

W. R. Berkley · Revenue · Quarterly

$3.03B

Q3 2023+11.2%vs Q3 2022
Beat estimate in 12 of 15 quarters(80%)
ActualEstimate

Revenue by segment

W. R. Berkley · $2.25B total across 2 segments · Q1 2022

  • Insurance
    $1.96B
  • Reinsurance & Monoline Excess
    $286M

Forward guidance

W. R. Berkley anticipates the higher interest rate environment will continue to increase investment income. The company remains optimistic about the remainder of 2023 and the foreseeable future.

Tailwinds

  • Anticipate higher interest rates continuing to increase investment income.
  • Expanding in areas likely to provide attractive risk-adjusted profitability.
  • Strong underwriting profits.
  • Effective capital management.
  • Decentralized operations and entrepreneurial culture.

Headwinds

  • Cyclical nature of the property casualty industry.
  • Impact of significant competition, including new entrants to the industry.
  • Long-tail and potentially volatile nature of the insurance and reinsurance business.
  • Investment risks, including those of our portfolio of fixed maturity securities and investments in equity securities.
  • The ongoing effects of the COVID-19 pandemic, or other epidemics and pandemics.

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 2023

Historical avgQ3 2023

+0.1%

Avg return

Earnings day

+0.6%

Avg return

5 days after

+2.8%

Avg return

30 days after

57%

39 / 69 earnings

Positive

+8.4%

Q4 2023

Best reaction

-8.5%

Q1 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.5%+1.2%+3.3%
Q4 2025+0.4%+2.5%+7.0%
Q3 2025+2.2%+2.1%+5.2%
Q2 2025-1.1%+1.5%+3.2%
Q1 2025+5.2%+4.7%+7.2%
Q4 2024+3.2%+2.3%+6.7%
Q3 2024-4.5%-5.1%-0.5%
Q2 2024+1.3%+4.9%+11.8%
Q1 2024-6.7%-8.1%-5.5%
Q4 2023+8.4%+5.7%+11.1%
Q3 2023+5.5%+3.2%+12.3%
Q2 2023+1.6%+0.2%+2.2%
Q1 2023-8.5%-8.3%-8.2%
Q4 2022-3.1%-1.8%-7.1%
Q3 2022-3.2%+2.7%+4.2%
Q2 2022-1.6%-0.2%+6.2%
Q1 2022-1.0%-2.2%+1.5%
Q4 2021+2.8%+4.2%+10.7%
Q3 2021+4.8%+4.3%+2.3%
Q2 2021-2.2%-2.9%-0.2%
Q1 2021-0.3%+0.7%-2.8%
Q4 2020-6.7%-5.9%+5.6%
Q3 2020+6.4%+7.4%+9.2%
Q2 2020+0.8%+0.9%-5.1%
Q1 2020-7.2%-9.1%+0.9%
Q4 2019+1.6%+2.7%-2.2%
Q3 2019+1.3%-2.1%-4.4%
Q2 2019+3.1%+5.7%+9.3%
Q1 2019+4.6%+5.1%+6.5%
Q4 2018+2.6%+3.5%+11.4%
Q3 2018-0.5%+0.8%+6.2%
Q2 2018-0.5%+1.0%+4.0%
Q1 2018+1.9%+1.5%+2.9%
Q4 2017+1.8%+2.3%-5.3%
Q3 2017+0.4%-0.7%-5.2%
Q2 2017-3.0%-3.2%-6.0%
Q1 2017+0.3%-0.0%-0.1%
Q4 2016-0.3%+0.8%+5.5%
Q3 2016+2.3%+1.4%+9.9%
Q2 2016-0.4%-1.3%-1.0%
Q1 2016+1.9%
Q4 2015+0.5%
Q3 2015+2.3%
Q2 2015-2.8%
Q1 2015+0.3%
Q4 2014-2.4%
Q3 2014+3.4%
Q2 2014+0.5%
Q1 2014+2.8%
Q4 2013+0.7%
Q3 2013-1.7%
Q2 2013-3.5%
Q1 2013-0.7%
Q4 2012-1.0%
Q3 2012+1.9%
Q2 2012-2.1%
Q1 2012+0.7%
Q4 2011-0.7%
Q3 2011+2.0%
Q2 2011-7.5%
Q1 2010+1.2%
Q1 2011+3.1%
Q4 2010-0.9%
Q3 2010-3.2%
Q3 2009-3.2%
Q4 2009+0.6%
Q2 2010+0.6%
Q4 2008+0.6%
Q2 2009+0.6%

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