Recent Quotes View Full List My Watchlist Create Watchlist Indicators DJI Nasdaq Composite SPX Gold Crude Oil EL&P Market Index Markets Stocks ETFs Tools Overview News Currencies International Treasuries AMERISAFE Announces 2023 Fourth Quarter and Year-end Results By: AMERISAFE, Inc. via Business Wire February 21, 2024 at 16:05 PM EST Reports $62.1 Million of Net Income, Return on Equity of 20.4% and Net Combined Ratio of 85.9% in 2023 AMERISAFE, Inc. (Nasdaq: AMSF), a specialty provider of workers’ compensation insurance focused on high-hazard industries, today announced results for the fourth quarter and year ended December 31, 2023. Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands, except per share data) (in thousands, except per share data) Net premiums earned $ 65,712 $ 66,073 -0.5 % $ 267,125 $ 271,698 -1.7 % Net investment income 8,077 7,642 5.7 % 31,339 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gain (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Net income 19,181 20,778 -7.7 % 62,108 55,602 11.7 % Diluted earnings per share $ 1.00 $ 1.08 -7.4 % $ 3.23 $ 2.88 12.2 % Operating net income 14,257 16,093 -11.4 % 55,940 59,277 -5.6 % Operating earnings per share $ 0.74 $ 0.84 -11.9 % $ 2.91 $ 3.07 -5.2 % Book value per share $ 15.28 $ 16.57 -7.8 % $ 15.28 $ 16.57 -7.8 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Return on average equity 24.4 % 24.1 % 20.4 % 15.5 % G. Janelle Frost, President and Chief Executive Officer, commented: “AMERISAFE’s value proposition to our policyholders, agents, and shareholders rests on our service and delivering on our commitments to them. The Company collaborates closely with insured parties to assess risks, bolster safety measures, and meticulously handle claims to achieve optimal results. The Company’s disciplined approach resulted in gross premium written growth of 8.4% and a combined ratio of 85.5% for the fourth quarter, and a 20.4% ROAE for the full year. Our capital strength and approach to the high-hazard workers’ compensation market position AMERISAFE for solid performance and ability to create long-term shareholder value into the future.” INSURANCE RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Gross premiums written $ 60,324 $ 55,647 8.4 % $ 285,355 $ 276,110 3.3 % Net premiums earned 65,712 66,073 -0.5 % 267,125 271,698 -1.7 % Loss and loss adjustment expenses incurred 36,455 36,524 -0.2 % 148,263 152,316 -2.7 % Underwriting and certain other operating costs, commissions, salaries and benefits 18,988 17,421 9.0 % 78,313 72,032 8.7 % Policyholder dividends 732 182 302.2 % 2,957 2,699 9.6 % Underwriting profit (pre-tax) $ 9,537 $ 11,946 -20.2 % $ 37,592 $ 44,651 -15.8 % Insurance Ratios: Current accident year loss ratio 71.0 % 71.0 % 71.0 % 71.0 % Prior accident year loss ratio -15.5 % -15.7 % -15.5 % -14.9 % Net loss ratio 55.5 % 55.3 % 55.5 % 56.1 % Net underwriting expense ratio 28.9 % 26.4 % 29.3 % 26.5 % Net dividend ratio 1.1 % 0.3 % 1.1 % 1.0 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Voluntary premiums on policies written in the quarter were 4.7% higher than in the fourth quarter of 2022, primarily due to an increase in policy count partially offset by continued declines in approved loss costs. For the full year, voluntary premiums increased by 0.3%. Payroll audits and related premium adjustments increased premiums written by $4.8 million in the fourth quarter of 2023, compared to an increase of $2.3 million in the fourth quarter of 2022. For the full year 2023, audits and related premium adjustments increased premiums by $24.0 million, compared to an increase of $14.0 million in 2022. The loss ratio for both the fourth quarter and full year was 55.5%. During the quarter, the Company experienced favorable net loss reserve development for prior accident years, which reduced loss and loss adjustment expenses by $10.2 million, primarily from accident years 2018 through 2021. For the full year, the Company experienced favorable development on prior accident years of $41.4 million, compared with $40.6 million in 2022. The Company attributes its lower claim severities for prior years to proactive claims handling. For the quarter that ended December 31, 2023, the underwriting expense ratio was 28.9% compared with 26.4% in the same quarter in 2022, as a result of slightly lower earned premium and increased insurance related assessments. For the year ended December 31, 2023, the underwriting expense ratio was 29.3%, compared with 26.5% in 2022, largely due to slightly lower earned premium and increased insurance related assessments. The effective tax rate for the full year 2023 was 19.7% compared with 17.8% for 2022. The rate was slightly higher than last year due to a decrease in the proportion of tax-exempt interest income relative to taxable interest income and underwriting profit. INVESTMENT RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Net investment income $ 8,077 $ 7,642 5.7 % $ 31,339 $ 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gains (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Pre-tax investment yield 3.5 % 3.1 % 3.4 % 2.7 % Tax-equivalent yield (1) 3.7 % 3.4 % 3.7 % 3.4 % ________________________________ (1) The tax equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate. Net investment income for the quarter and full year ended December 31, 2023, increased 5.7% to $8.1 million and 15.1% to $31.3 million, respectively, due to higher fixed income reinvestment rates in relation to portfolio rolloff. Net unrealized gains on equity securities were $5.1 million in the fourth quarter. The full year unrealized gain of $1.2 million is reflective of favorable equity market returns during the year. As of December 31, 2023, the carrying value of AMERISAFE’s investment portfolio, including cash and cash equivalents, was $896.5 million. CAPITAL MANAGEMENT During the fourth quarter of 2023, the Company repurchased 46,741 shares at an average cost (including commissions and excise tax) of $46.45 per share for a total of $2.2 million. The remaining outstanding share repurchase authorization as of December 31, 2023 is $10.4 million. In an accompanying announcement, the Company’s Board of Directors increased the regular quarterly dividend by 8.8% from $0.34 per share to $0.37 per share, payable on March 22, 2024, to shareholders of record as of March 8, 2024. SUPPLEMENTAL INFORMATION Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (in thousands, except share and per share data) Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Less: Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Tax effect (1) (1,309 ) (1,245 ) (1,639 ) 977 Operating net income (2) $ 14,257 $ 16,093 $ 55,940 $ 59,277 Average shareholders’ equity (3) $ 314,167 $ 345,226 $ 304,942 $ 358,378 Less: Average accumulated other comprehensive loss (13,779 ) (16,896 ) (10,511 ) (146 ) Average adjusted shareholders’ equity (2) $ 327,946 $ 362,122 $ 315,453 $ 358,524 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Return on average equity (4) 24.4 % 24.1 % 20.4 % 15.5 % Operating return on average adjusted equity (2) 17.4 % 17.8 % 17.7 % 16.5 % Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 Operating earnings per share (2) $ 0.74 $ 0.84 $ 2.91 $ 3.07 ________________________________ (1) The tax effect of net realized losses on investments and net unrealized gains (losses) on equity securities is calculated with an effective tax rate of 21%. (2) Operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share are non-GAAP financial measures. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures. (3) Average shareholders’ equity is calculated by taking the average of the beginning and ending shareholders’ equity for the applicable period. (4) Return on average equity is calculated by dividing the annualized net income by the average shareholders’ equity. NON-GAAP FINANCIAL MEASURES This release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission (the SEC) and includes a reconciliation of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP in the Supplemental Information in this release. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures which include operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share. CONFERENCE CALL INFORMATION AMERISAFE has scheduled a conference call for February 22, 2024, at 10:30 a.m. Eastern Time to discuss the results for the quarter and comment on future periods. To participate in the conference call, dial 323-794-2423 (Conference Code 9182860) at least ten minutes before the call begins. Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by visiting the “Investor Relations Home” page of the “Investors” section of the Company’s website (http://www.amerisafe.com). To listen to the live call on the web, please visit the website at least fifteen minutes before the call begins to register, download and install any necessary audio software. For those who cannot listen to the live webcast, an archive will be available shortly after the call at the same website location. ABOUT AMERISAFE AMERISAFE, Inc. is a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, and manufacturing. AMERISAFE actively markets workers’ compensation insurance in 27 states. FORWARD LOOKING STATEMENTS Statements made in this press release that are not historical facts, including statements accompanied by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” or similar words are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding AMERISAFE’s plans and performance. These statements are based on management’s estimates, assumptions and projections as of the date of this release and are not guarantees of future performance and include statements regarding management’s views and expectations of the workers’ compensation market, the Company’s growth opportunities, underwriting margins and actions by competitors. Actual results may differ materially from the results expressed or implied in these statements if the underlying assumptions prove to be incorrect or as the results of risks, uncertainties and other factors on the business and operations of the Company and our policyholders and the market value of our investment portfolio. Additional factors that may affect our results are set forth in the Company’s filings with the Securities and Exchange Commission, including AMERISAFE’s Annual Report on Form 10-K. AMERISAFE cautions you not to place undue reliance on the forward-looking statements contained in this release. AMERISAFE does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. AMERISAFE, INC. AND SUBSIDIARIES Consolidated Statements of Income (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Revenues: Gross premiums written $ 60,324 $ 55,647 $ 285,355 $ 276,110 Ceded premiums written (4,365 ) (2,690 ) (16,621 ) (10,527 ) Net premiums written $ 55,959 $ 52,957 $ 268,734 $ 265,583 Net premiums earned $ 65,712 $ 66,073 $ 267,125 $ 271,698 Net investment income 8,077 7,642 31,339 27,223 Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Fee and other income 94 116 582 468 Total revenues 80,116 79,761 306,853 294,737 Expenses: Loss and loss adjustment expenses incurred 36,455 36,524 148,263 152,316 Underwriting and other operating costs 18,988 17,421 78,313 72,032 Policyholder dividends 732 182 2,957 2,699 Provision for investment related credit loss expense (benefit) (6 ) (16 ) (57 ) 44 Total expenses 56,169 54,111 229,476 227,091 Income before taxes 23,947 25,650 77,377 67,646 Income tax expense 4,766 4,872 15,269 12,044 Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Basic EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Basic weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Basic earnings per share $ 1.00 $ 1.09 $ 3.24 $ 2.89 Diluted EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Diluted weighted average common shares: Weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Restricted stock and RSUs 60,339 78,008 76,941 88,476 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 AMERISAFE, INC. AND SUBSIDIARIES Consolidated Balance Sheets (in thousands) December 31, December 31, 2023 2022 (unaudited) Assets Investments $ 857,786 $ 888,987 Cash and cash equivalents 38,682 61,469 Amounts recoverable from reinsurers 129,963 125,677 Premiums receivable, net 132,861 121,713 Deferred income taxes 20,403 22,794 Deferred policy acquisition costs 17,975 17,401 Other assets 31,492 31,238 $ 1,229,162 $ 1,269,279 Liabilities and Shareholders’ Equity Liabilities: Reserves for loss and loss adjustment expenses $ 673,994 $ 696,037 Unearned premiums 116,585 114,976 Insurance-related assessments 16,896 17,653 Other liabilities 129,236 123,181 Shareholders’ equity 292,451 317,432 Total liabilities and shareholders’ equity $ 1,229,162 $ 1,269,279 View source version on businesswire.com: https://www.businesswire.com/news/home/20240221323970/en/Contacts Andy Omiridis, EVP & CFO AMERISAFE 337.463.9052 Data & News supplied by www.cloudquote.io Stock quotes supplied by Barchart Quotes delayed at least 20 minutes. 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AMERISAFE Announces 2023 Fourth Quarter and Year-end Results By: AMERISAFE, Inc. via Business Wire February 21, 2024 at 16:05 PM EST Reports $62.1 Million of Net Income, Return on Equity of 20.4% and Net Combined Ratio of 85.9% in 2023 AMERISAFE, Inc. (Nasdaq: AMSF), a specialty provider of workers’ compensation insurance focused on high-hazard industries, today announced results for the fourth quarter and year ended December 31, 2023. Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands, except per share data) (in thousands, except per share data) Net premiums earned $ 65,712 $ 66,073 -0.5 % $ 267,125 $ 271,698 -1.7 % Net investment income 8,077 7,642 5.7 % 31,339 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gain (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Net income 19,181 20,778 -7.7 % 62,108 55,602 11.7 % Diluted earnings per share $ 1.00 $ 1.08 -7.4 % $ 3.23 $ 2.88 12.2 % Operating net income 14,257 16,093 -11.4 % 55,940 59,277 -5.6 % Operating earnings per share $ 0.74 $ 0.84 -11.9 % $ 2.91 $ 3.07 -5.2 % Book value per share $ 15.28 $ 16.57 -7.8 % $ 15.28 $ 16.57 -7.8 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Return on average equity 24.4 % 24.1 % 20.4 % 15.5 % G. Janelle Frost, President and Chief Executive Officer, commented: “AMERISAFE’s value proposition to our policyholders, agents, and shareholders rests on our service and delivering on our commitments to them. The Company collaborates closely with insured parties to assess risks, bolster safety measures, and meticulously handle claims to achieve optimal results. The Company’s disciplined approach resulted in gross premium written growth of 8.4% and a combined ratio of 85.5% for the fourth quarter, and a 20.4% ROAE for the full year. Our capital strength and approach to the high-hazard workers’ compensation market position AMERISAFE for solid performance and ability to create long-term shareholder value into the future.” INSURANCE RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Gross premiums written $ 60,324 $ 55,647 8.4 % $ 285,355 $ 276,110 3.3 % Net premiums earned 65,712 66,073 -0.5 % 267,125 271,698 -1.7 % Loss and loss adjustment expenses incurred 36,455 36,524 -0.2 % 148,263 152,316 -2.7 % Underwriting and certain other operating costs, commissions, salaries and benefits 18,988 17,421 9.0 % 78,313 72,032 8.7 % Policyholder dividends 732 182 302.2 % 2,957 2,699 9.6 % Underwriting profit (pre-tax) $ 9,537 $ 11,946 -20.2 % $ 37,592 $ 44,651 -15.8 % Insurance Ratios: Current accident year loss ratio 71.0 % 71.0 % 71.0 % 71.0 % Prior accident year loss ratio -15.5 % -15.7 % -15.5 % -14.9 % Net loss ratio 55.5 % 55.3 % 55.5 % 56.1 % Net underwriting expense ratio 28.9 % 26.4 % 29.3 % 26.5 % Net dividend ratio 1.1 % 0.3 % 1.1 % 1.0 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Voluntary premiums on policies written in the quarter were 4.7% higher than in the fourth quarter of 2022, primarily due to an increase in policy count partially offset by continued declines in approved loss costs. For the full year, voluntary premiums increased by 0.3%. Payroll audits and related premium adjustments increased premiums written by $4.8 million in the fourth quarter of 2023, compared to an increase of $2.3 million in the fourth quarter of 2022. For the full year 2023, audits and related premium adjustments increased premiums by $24.0 million, compared to an increase of $14.0 million in 2022. The loss ratio for both the fourth quarter and full year was 55.5%. During the quarter, the Company experienced favorable net loss reserve development for prior accident years, which reduced loss and loss adjustment expenses by $10.2 million, primarily from accident years 2018 through 2021. For the full year, the Company experienced favorable development on prior accident years of $41.4 million, compared with $40.6 million in 2022. The Company attributes its lower claim severities for prior years to proactive claims handling. For the quarter that ended December 31, 2023, the underwriting expense ratio was 28.9% compared with 26.4% in the same quarter in 2022, as a result of slightly lower earned premium and increased insurance related assessments. For the year ended December 31, 2023, the underwriting expense ratio was 29.3%, compared with 26.5% in 2022, largely due to slightly lower earned premium and increased insurance related assessments. The effective tax rate for the full year 2023 was 19.7% compared with 17.8% for 2022. The rate was slightly higher than last year due to a decrease in the proportion of tax-exempt interest income relative to taxable interest income and underwriting profit. INVESTMENT RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Net investment income $ 8,077 $ 7,642 5.7 % $ 31,339 $ 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gains (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Pre-tax investment yield 3.5 % 3.1 % 3.4 % 2.7 % Tax-equivalent yield (1) 3.7 % 3.4 % 3.7 % 3.4 % ________________________________ (1) The tax equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate. Net investment income for the quarter and full year ended December 31, 2023, increased 5.7% to $8.1 million and 15.1% to $31.3 million, respectively, due to higher fixed income reinvestment rates in relation to portfolio rolloff. Net unrealized gains on equity securities were $5.1 million in the fourth quarter. The full year unrealized gain of $1.2 million is reflective of favorable equity market returns during the year. As of December 31, 2023, the carrying value of AMERISAFE’s investment portfolio, including cash and cash equivalents, was $896.5 million. CAPITAL MANAGEMENT During the fourth quarter of 2023, the Company repurchased 46,741 shares at an average cost (including commissions and excise tax) of $46.45 per share for a total of $2.2 million. The remaining outstanding share repurchase authorization as of December 31, 2023 is $10.4 million. In an accompanying announcement, the Company’s Board of Directors increased the regular quarterly dividend by 8.8% from $0.34 per share to $0.37 per share, payable on March 22, 2024, to shareholders of record as of March 8, 2024. SUPPLEMENTAL INFORMATION Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (in thousands, except share and per share data) Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Less: Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Tax effect (1) (1,309 ) (1,245 ) (1,639 ) 977 Operating net income (2) $ 14,257 $ 16,093 $ 55,940 $ 59,277 Average shareholders’ equity (3) $ 314,167 $ 345,226 $ 304,942 $ 358,378 Less: Average accumulated other comprehensive loss (13,779 ) (16,896 ) (10,511 ) (146 ) Average adjusted shareholders’ equity (2) $ 327,946 $ 362,122 $ 315,453 $ 358,524 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Return on average equity (4) 24.4 % 24.1 % 20.4 % 15.5 % Operating return on average adjusted equity (2) 17.4 % 17.8 % 17.7 % 16.5 % Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 Operating earnings per share (2) $ 0.74 $ 0.84 $ 2.91 $ 3.07 ________________________________ (1) The tax effect of net realized losses on investments and net unrealized gains (losses) on equity securities is calculated with an effective tax rate of 21%. (2) Operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share are non-GAAP financial measures. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures. (3) Average shareholders’ equity is calculated by taking the average of the beginning and ending shareholders’ equity for the applicable period. (4) Return on average equity is calculated by dividing the annualized net income by the average shareholders’ equity. NON-GAAP FINANCIAL MEASURES This release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission (the SEC) and includes a reconciliation of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP in the Supplemental Information in this release. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures which include operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share. CONFERENCE CALL INFORMATION AMERISAFE has scheduled a conference call for February 22, 2024, at 10:30 a.m. Eastern Time to discuss the results for the quarter and comment on future periods. To participate in the conference call, dial 323-794-2423 (Conference Code 9182860) at least ten minutes before the call begins. Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by visiting the “Investor Relations Home” page of the “Investors” section of the Company’s website (http://www.amerisafe.com). To listen to the live call on the web, please visit the website at least fifteen minutes before the call begins to register, download and install any necessary audio software. For those who cannot listen to the live webcast, an archive will be available shortly after the call at the same website location. ABOUT AMERISAFE AMERISAFE, Inc. is a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, and manufacturing. AMERISAFE actively markets workers’ compensation insurance in 27 states. FORWARD LOOKING STATEMENTS Statements made in this press release that are not historical facts, including statements accompanied by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” or similar words are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding AMERISAFE’s plans and performance. These statements are based on management’s estimates, assumptions and projections as of the date of this release and are not guarantees of future performance and include statements regarding management’s views and expectations of the workers’ compensation market, the Company’s growth opportunities, underwriting margins and actions by competitors. Actual results may differ materially from the results expressed or implied in these statements if the underlying assumptions prove to be incorrect or as the results of risks, uncertainties and other factors on the business and operations of the Company and our policyholders and the market value of our investment portfolio. Additional factors that may affect our results are set forth in the Company’s filings with the Securities and Exchange Commission, including AMERISAFE’s Annual Report on Form 10-K. AMERISAFE cautions you not to place undue reliance on the forward-looking statements contained in this release. AMERISAFE does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. AMERISAFE, INC. AND SUBSIDIARIES Consolidated Statements of Income (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Revenues: Gross premiums written $ 60,324 $ 55,647 $ 285,355 $ 276,110 Ceded premiums written (4,365 ) (2,690 ) (16,621 ) (10,527 ) Net premiums written $ 55,959 $ 52,957 $ 268,734 $ 265,583 Net premiums earned $ 65,712 $ 66,073 $ 267,125 $ 271,698 Net investment income 8,077 7,642 31,339 27,223 Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Fee and other income 94 116 582 468 Total revenues 80,116 79,761 306,853 294,737 Expenses: Loss and loss adjustment expenses incurred 36,455 36,524 148,263 152,316 Underwriting and other operating costs 18,988 17,421 78,313 72,032 Policyholder dividends 732 182 2,957 2,699 Provision for investment related credit loss expense (benefit) (6 ) (16 ) (57 ) 44 Total expenses 56,169 54,111 229,476 227,091 Income before taxes 23,947 25,650 77,377 67,646 Income tax expense 4,766 4,872 15,269 12,044 Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Basic EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Basic weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Basic earnings per share $ 1.00 $ 1.09 $ 3.24 $ 2.89 Diluted EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Diluted weighted average common shares: Weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Restricted stock and RSUs 60,339 78,008 76,941 88,476 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 AMERISAFE, INC. AND SUBSIDIARIES Consolidated Balance Sheets (in thousands) December 31, December 31, 2023 2022 (unaudited) Assets Investments $ 857,786 $ 888,987 Cash and cash equivalents 38,682 61,469 Amounts recoverable from reinsurers 129,963 125,677 Premiums receivable, net 132,861 121,713 Deferred income taxes 20,403 22,794 Deferred policy acquisition costs 17,975 17,401 Other assets 31,492 31,238 $ 1,229,162 $ 1,269,279 Liabilities and Shareholders’ Equity Liabilities: Reserves for loss and loss adjustment expenses $ 673,994 $ 696,037 Unearned premiums 116,585 114,976 Insurance-related assessments 16,896 17,653 Other liabilities 129,236 123,181 Shareholders’ equity 292,451 317,432 Total liabilities and shareholders’ equity $ 1,229,162 $ 1,269,279 View source version on businesswire.com: https://www.businesswire.com/news/home/20240221323970/en/Contacts Andy Omiridis, EVP & CFO AMERISAFE 337.463.9052
Reports $62.1 Million of Net Income, Return on Equity of 20.4% and Net Combined Ratio of 85.9% in 2023
AMERISAFE, Inc. (Nasdaq: AMSF), a specialty provider of workers’ compensation insurance focused on high-hazard industries, today announced results for the fourth quarter and year ended December 31, 2023. Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands, except per share data) (in thousands, except per share data) Net premiums earned $ 65,712 $ 66,073 -0.5 % $ 267,125 $ 271,698 -1.7 % Net investment income 8,077 7,642 5.7 % 31,339 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gain (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Net income 19,181 20,778 -7.7 % 62,108 55,602 11.7 % Diluted earnings per share $ 1.00 $ 1.08 -7.4 % $ 3.23 $ 2.88 12.2 % Operating net income 14,257 16,093 -11.4 % 55,940 59,277 -5.6 % Operating earnings per share $ 0.74 $ 0.84 -11.9 % $ 2.91 $ 3.07 -5.2 % Book value per share $ 15.28 $ 16.57 -7.8 % $ 15.28 $ 16.57 -7.8 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Return on average equity 24.4 % 24.1 % 20.4 % 15.5 % G. Janelle Frost, President and Chief Executive Officer, commented: “AMERISAFE’s value proposition to our policyholders, agents, and shareholders rests on our service and delivering on our commitments to them. The Company collaborates closely with insured parties to assess risks, bolster safety measures, and meticulously handle claims to achieve optimal results. The Company’s disciplined approach resulted in gross premium written growth of 8.4% and a combined ratio of 85.5% for the fourth quarter, and a 20.4% ROAE for the full year. Our capital strength and approach to the high-hazard workers’ compensation market position AMERISAFE for solid performance and ability to create long-term shareholder value into the future.” INSURANCE RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Gross premiums written $ 60,324 $ 55,647 8.4 % $ 285,355 $ 276,110 3.3 % Net premiums earned 65,712 66,073 -0.5 % 267,125 271,698 -1.7 % Loss and loss adjustment expenses incurred 36,455 36,524 -0.2 % 148,263 152,316 -2.7 % Underwriting and certain other operating costs, commissions, salaries and benefits 18,988 17,421 9.0 % 78,313 72,032 8.7 % Policyholder dividends 732 182 302.2 % 2,957 2,699 9.6 % Underwriting profit (pre-tax) $ 9,537 $ 11,946 -20.2 % $ 37,592 $ 44,651 -15.8 % Insurance Ratios: Current accident year loss ratio 71.0 % 71.0 % 71.0 % 71.0 % Prior accident year loss ratio -15.5 % -15.7 % -15.5 % -14.9 % Net loss ratio 55.5 % 55.3 % 55.5 % 56.1 % Net underwriting expense ratio 28.9 % 26.4 % 29.3 % 26.5 % Net dividend ratio 1.1 % 0.3 % 1.1 % 1.0 % Net combined ratio 85.5 % 82.0 % 85.9 % 83.6 % Voluntary premiums on policies written in the quarter were 4.7% higher than in the fourth quarter of 2022, primarily due to an increase in policy count partially offset by continued declines in approved loss costs. For the full year, voluntary premiums increased by 0.3%. Payroll audits and related premium adjustments increased premiums written by $4.8 million in the fourth quarter of 2023, compared to an increase of $2.3 million in the fourth quarter of 2022. For the full year 2023, audits and related premium adjustments increased premiums by $24.0 million, compared to an increase of $14.0 million in 2022. The loss ratio for both the fourth quarter and full year was 55.5%. During the quarter, the Company experienced favorable net loss reserve development for prior accident years, which reduced loss and loss adjustment expenses by $10.2 million, primarily from accident years 2018 through 2021. For the full year, the Company experienced favorable development on prior accident years of $41.4 million, compared with $40.6 million in 2022. The Company attributes its lower claim severities for prior years to proactive claims handling. For the quarter that ended December 31, 2023, the underwriting expense ratio was 28.9% compared with 26.4% in the same quarter in 2022, as a result of slightly lower earned premium and increased insurance related assessments. For the year ended December 31, 2023, the underwriting expense ratio was 29.3%, compared with 26.5% in 2022, largely due to slightly lower earned premium and increased insurance related assessments. The effective tax rate for the full year 2023 was 19.7% compared with 17.8% for 2022. The rate was slightly higher than last year due to a decrease in the proportion of tax-exempt interest income relative to taxable interest income and underwriting profit. INVESTMENT RESULTS Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 % Change 2023 2022 % Change (in thousands) (in thousands) Net investment income $ 8,077 $ 7,642 5.7 % $ 31,339 $ 27,223 15.1 % Net realized gains on investments (pre-tax) 1,113 1,038 7.2 % 6,579 3,440 91.3 % Net unrealized gains (losses) on equity securities (pre-tax) 5,120 4,892 NM 1,228 (8,092 ) NM Pre-tax investment yield 3.5 % 3.1 % 3.4 % 2.7 % Tax-equivalent yield (1) 3.7 % 3.4 % 3.7 % 3.4 % ________________________________ (1) The tax equivalent yield is calculated using the effective interest rate and the appropriate marginal tax rate. Net investment income for the quarter and full year ended December 31, 2023, increased 5.7% to $8.1 million and 15.1% to $31.3 million, respectively, due to higher fixed income reinvestment rates in relation to portfolio rolloff. Net unrealized gains on equity securities were $5.1 million in the fourth quarter. The full year unrealized gain of $1.2 million is reflective of favorable equity market returns during the year. As of December 31, 2023, the carrying value of AMERISAFE’s investment portfolio, including cash and cash equivalents, was $896.5 million. CAPITAL MANAGEMENT During the fourth quarter of 2023, the Company repurchased 46,741 shares at an average cost (including commissions and excise tax) of $46.45 per share for a total of $2.2 million. The remaining outstanding share repurchase authorization as of December 31, 2023 is $10.4 million. In an accompanying announcement, the Company’s Board of Directors increased the regular quarterly dividend by 8.8% from $0.34 per share to $0.37 per share, payable on March 22, 2024, to shareholders of record as of March 8, 2024. SUPPLEMENTAL INFORMATION Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (in thousands, except share and per share data) Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Less: Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Tax effect (1) (1,309 ) (1,245 ) (1,639 ) 977 Operating net income (2) $ 14,257 $ 16,093 $ 55,940 $ 59,277 Average shareholders’ equity (3) $ 314,167 $ 345,226 $ 304,942 $ 358,378 Less: Average accumulated other comprehensive loss (13,779 ) (16,896 ) (10,511 ) (146 ) Average adjusted shareholders’ equity (2) $ 327,946 $ 362,122 $ 315,453 $ 358,524 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Return on average equity (4) 24.4 % 24.1 % 20.4 % 15.5 % Operating return on average adjusted equity (2) 17.4 % 17.8 % 17.7 % 16.5 % Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 Operating earnings per share (2) $ 0.74 $ 0.84 $ 2.91 $ 3.07 ________________________________ (1) The tax effect of net realized losses on investments and net unrealized gains (losses) on equity securities is calculated with an effective tax rate of 21%. (2) Operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share are non-GAAP financial measures. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures. (3) Average shareholders’ equity is calculated by taking the average of the beginning and ending shareholders’ equity for the applicable period. (4) Return on average equity is calculated by dividing the annualized net income by the average shareholders’ equity. NON-GAAP FINANCIAL MEASURES This release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission (the SEC) and includes a reconciliation of non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP in the Supplemental Information in this release. Management believes that investors’ understanding of core operating performance is enhanced by AMERISAFE’s disclosure of these financial measures which include operating net income, average adjusted shareholders’ equity, operating return on average adjusted equity and operating earnings per share. CONFERENCE CALL INFORMATION AMERISAFE has scheduled a conference call for February 22, 2024, at 10:30 a.m. Eastern Time to discuss the results for the quarter and comment on future periods. To participate in the conference call, dial 323-794-2423 (Conference Code 9182860) at least ten minutes before the call begins. Investors, analysts and the general public will also have the opportunity to listen to the conference call over the Internet by visiting the “Investor Relations Home” page of the “Investors” section of the Company’s website (http://www.amerisafe.com). To listen to the live call on the web, please visit the website at least fifteen minutes before the call begins to register, download and install any necessary audio software. For those who cannot listen to the live webcast, an archive will be available shortly after the call at the same website location. ABOUT AMERISAFE AMERISAFE, Inc. is a specialty provider of workers’ compensation insurance focused on small to mid-sized employers engaged in hazardous industries, principally construction, trucking, logging and lumber, agriculture, and manufacturing. AMERISAFE actively markets workers’ compensation insurance in 27 states. FORWARD LOOKING STATEMENTS Statements made in this press release that are not historical facts, including statements accompanied by words such as “will,” “believe,” “anticipate,” “expect,” “estimate,” or similar words are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding AMERISAFE’s plans and performance. These statements are based on management’s estimates, assumptions and projections as of the date of this release and are not guarantees of future performance and include statements regarding management’s views and expectations of the workers’ compensation market, the Company’s growth opportunities, underwriting margins and actions by competitors. Actual results may differ materially from the results expressed or implied in these statements if the underlying assumptions prove to be incorrect or as the results of risks, uncertainties and other factors on the business and operations of the Company and our policyholders and the market value of our investment portfolio. Additional factors that may affect our results are set forth in the Company’s filings with the Securities and Exchange Commission, including AMERISAFE’s Annual Report on Form 10-K. AMERISAFE cautions you not to place undue reliance on the forward-looking statements contained in this release. AMERISAFE does not undertake any obligation to publicly update or revise any forward-looking statements to reflect future events, information or circumstances that arise after the date of this release. AMERISAFE, INC. AND SUBSIDIARIES Consolidated Statements of Income (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Revenues: Gross premiums written $ 60,324 $ 55,647 $ 285,355 $ 276,110 Ceded premiums written (4,365 ) (2,690 ) (16,621 ) (10,527 ) Net premiums written $ 55,959 $ 52,957 $ 268,734 $ 265,583 Net premiums earned $ 65,712 $ 66,073 $ 267,125 $ 271,698 Net investment income 8,077 7,642 31,339 27,223 Net realized gains on investments 1,113 1,038 6,579 3,440 Net unrealized gains (losses) on equity securities 5,120 4,892 1,228 (8,092 ) Fee and other income 94 116 582 468 Total revenues 80,116 79,761 306,853 294,737 Expenses: Loss and loss adjustment expenses incurred 36,455 36,524 148,263 152,316 Underwriting and other operating costs 18,988 17,421 78,313 72,032 Policyholder dividends 732 182 2,957 2,699 Provision for investment related credit loss expense (benefit) (6 ) (16 ) (57 ) 44 Total expenses 56,169 54,111 229,476 227,091 Income before taxes 23,947 25,650 77,377 67,646 Income tax expense 4,766 4,872 15,269 12,044 Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Three Months Ended Twelve Months Ended December 31, December 31, 2023 2022 2023 2022 (unaudited) (unaudited) Basic EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Basic weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Basic earnings per share $ 1.00 $ 1.09 $ 3.24 $ 2.89 Diluted EPS: Net income $ 19,181 $ 20,778 $ 62,108 $ 55,602 Diluted weighted average common shares: Weighted average common shares 19,159,911 19,131,271 19,149,080 19,233,241 Restricted stock and RSUs 60,339 78,008 76,941 88,476 Diluted weighted average common shares 19,220,250 19,209,279 19,226,021 19,321,717 Diluted earnings per share $ 1.00 $ 1.08 $ 3.23 $ 2.88 AMERISAFE, INC. AND SUBSIDIARIES Consolidated Balance Sheets (in thousands) December 31, December 31, 2023 2022 (unaudited) Assets Investments $ 857,786 $ 888,987 Cash and cash equivalents 38,682 61,469 Amounts recoverable from reinsurers 129,963 125,677 Premiums receivable, net 132,861 121,713 Deferred income taxes 20,403 22,794 Deferred policy acquisition costs 17,975 17,401 Other assets 31,492 31,238 $ 1,229,162 $ 1,269,279 Liabilities and Shareholders’ Equity Liabilities: Reserves for loss and loss adjustment expenses $ 673,994 $ 696,037 Unearned premiums 116,585 114,976 Insurance-related assessments 16,896 17,653 Other liabilities 129,236 123,181 Shareholders’ equity 292,451 317,432 Total liabilities and shareholders’ equity $ 1,229,162 $ 1,269,279 View source version on businesswire.com: https://www.businesswire.com/news/home/20240221323970/en/