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SKWD Nasdaq· Skyward Specialty Insurance Group Inc
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SKWD Nasdaq· Skyward Specialty Insurance Group Inc
Earnings report Q3 2023

SKWD Reports Strong Revenue Growth in Latest Quarter

Segments of Revenue

SKWD Specialty Insurance Group, Inc. reported robust revenue growth in the latest quarter. The company's net earned premiums increased from $158.0 million in the same quarter last year to $227.0 million, representing a significant growth of 43.7%. This growth was primarily driven by higher premiums in the insurance segment. Additionally, commission and fee income increased from $1.4 million to $2.1 million, reflecting a growth of 53.6%. The company also saw a notable increase in net investment income, which rose from $6.0 million to $13.1 million, indicating a growth of 118.3%. However, the company experienced net investment losses of $3.0 million in the current quarter, compared to net investment losses of $7.3 million in the same quarter last year.

Strengths

SKWD demonstrated strong revenue growth in the latest quarter, driven by higher net earned premiums and increased commission and fee income. The company's management attributed the growth in net earned premiums to improved underwriting performance and favorable market conditions. The increase in commission and fee income can be attributed to higher sales and improved business partnerships. Furthermore, the significant growth in net investment income indicates successful investment strategies implemented by the company.

Challenges

Despite the overall positive revenue performance, SKWD faced challenges in managing investment losses. The company reported net investment losses of $3.0 million in the current quarter, which impacted its overall financial performance. SKWD should focus on implementing effective risk management strategies to mitigate investment losses and ensure long-term profitability.

Noteworthy

It is worth mentioning that SKWD entered into reinsurance agreements with Everest Re, an affiliate of Mt. Whitney Securities, LLC. This agreement played a significant role in the company's financial performance. Mt. Whitney Securities divested its holdings in SKWD during the nine months ended September 30, 2023, which may have implications for future reinsurance arrangements.

Summary

SKWD Specialty Insurance Group, Inc. delivered strong revenue growth in the latest quarter, driven by higher net earned premiums, increased commission and fee income, and improved investment income. The company's management highlighted improved underwriting performance and favorable market conditions as key factors contributing to the growth in net earned premiums. However, SKWD faced challenges in managing investment losses, which impacted its overall financial performance. Going forward, the company should focus on implementing effective risk management strategies to mitigate investment losses and ensure sustainable growth.

Source documents

Form 10-Q  filed on Nov 09, 2023
3 pages scanned

Reference data

Company financials Q3 revenue 246M
Analyst estimates Q3 EPS beat by 6.78%
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