OLD REPUBLIC REPORTS RESULTS FOR THE FOURTH QUARTER AND FULL YEAR 2023
CHICAGO, Jan. 25, 2024 /PRNewswire/ --
OVERALL RESULTS | ||||||||||||
Quarters Ended December 31, | Years Ended December 31, | |||||||||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||
Pretax income | $ 237.4 | $ 649.0 | $ 747.4 | $ 857.4 | ||||||||
Pretax investment gains (losses) | 0.2 | 348.3 | (190.9) | (201.1) | ||||||||
Pretax income excluding investment gains (losses) | $ 237.1 | $ 300.6 | (21.1) % | $ 938.4 | $ 1,058.6 | (11.4) % | ||||||
Net income | $ 190.6 | $ 512.1 | $ 598.6 | $ 686.4 | ||||||||
Net of tax investment gains (losses) | 0.1 | 275.2 | (150.8) | (158.6) | ||||||||
Net income excluding investment gains (losses) | $ 190.4 | $ 236.9 | (19.6) % | $ 749.5 | $ 845.1 | (11.3) % | ||||||
Combined ratio | 93.3 % | 89.6 % | 92.6 % | 91.0 % | ||||||||
PER DILUTED SHARE | ||||||||||||
Quarters Ended December 31, | Years Ended December 31, | |||||||||||
2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||
Net income | $ 0.69 | $ 1.73 | $ 2.10 | $ 2.26 | ||||||||
Net of tax investment gains (losses) | — | 0.93 | (0.53) | (0.53) | ||||||||
Net income excluding investment gains (losses) | $ 0.69 | $ 0.80 | (13.8) % | $ 2.63 | $ 2.79 | (5.7) % | ||||||
SHAREHOLDERS' EQUITY (BOOK VALUE) | ||||||||||||
Dec. 31, | Dec. 31, | |||||||||||
2023 | 2022 | % Change | ||||||||||
Total | $ 6,410.7 | $ 6,173.2 | 3.8 % | |||||||||
Per Common Share | $ 23.31 | $ 21.07 | 10.6 % | |||||||||
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All amounts in this report are stated in millions except where noted, common stock data and percentages. |
Old Republic International Corporation (NYSE: ORI) today reported pretax income, excluding investment losses (pretax operating income), of $237.1 for the quarter and $938.4 for the full year 2023. Title Insurance pretax operating income was relatively consistent for the quarter, but declined for the full year. General Insurance pretax operating income decreased for the quarter but was higher for the full year.
Results for the quarter and full year are summarized as follows:
- Consolidated combined ratios were 93.3% for the quarter and 92.6% for the full year.
- Consolidated net premiums and fees earned decreased 4.8% for the quarter and 12.6% for the full year. The continued decline in Title Insurance net premiums and fees earned was partially offset by strong growth in General Insurance.
- Net investment income increased 19.1% for the quarter and 25.8% for the full year driven by higher investment yields earned.
- Favorable loss reserve development improved the combined ratio by 4.7 percentage points for the quarter and 4.6 percentage points for the full year.
- Total capital returned to shareholders during the quarter was $122, comprised of $67 in dividends, and $55 of share repurchases. For the year, total capital returned was $806, comprised of $276 in dividends, and $530 of share repurchases.
- Book value per share grew to $23.31, a 15.3% increase for the full year, inclusive of dividends.
Old Republic's business is managed for the long run. In this context management's key objectives are to achieve highly profitable operating results over the long term, and to ensure balance sheet strength for the insurance underwriting subsidiaries' obligations. Therefore, the evaluation of periodic and long-term results excludes consideration of all investment gains (losses). Under Generally Accepted Accounting Principles (GAAP), however, net income, inclusive of investment gains (losses), is the measure of total profitability.
In management's opinion, the focus on income excluding investment gains (losses), also described herein as segment pretax operating income, provides a better way to analyze, evaluate, and establish accountability for the results of the insurance operations. The inclusion of realized investment gains (losses) in net income can mask trends in operating results, because such realizations are often highly discretionary. Similarly, the inclusion of unrealized investment gains (losses) in equity securities can further distort such operating results with significant period-to-period fluctuations.
FINANCIAL HIGHLIGHTS | |||||||||||||
Quarters Ended December 31, | Years Ended December 31, | ||||||||||||
SUMMARY INCOME STATEMENTS: | 2023 | 2022 | % Change | 2023 | 2022 | % Change | |||||||
Revenues: | |||||||||||||
Net premiums and fees earned | $ 1,743.6 | $ 1,830.6 | (4.8) % | $ 6,707.7 | $ 7,675.3 | (12.6) % | |||||||
Net investment income | 155.1 | 130.2 | 19.1 | 578.3 | 459.5 | 25.8 | |||||||
Other income | 42.0 | 36.2 | 16.1 | 163.1 | 149.9 | 8.8 | |||||||
Total operating revenues | 1,940.8 | 1,997.2 | (2.8) | 7,449.3 | 8,284.9 | (10.1) | |||||||
Investment gains (losses): | |||||||||||||
Realized from actual transactions and impairments | (8.2) | (30.0) | (21.4) | 62.2 | |||||||||
Realized from pending sale of mortgage insurance business | (45.6) | — | (45.6) | — | |||||||||
Unrealized from changes in fair value of equity securities | 54.1 | 378.4 | (123.9) | (263.4) | |||||||||
Total investment gains (losses) | 0.2 | 348.3 | (190.9) | (201.1) | |||||||||
Total revenues | 1,941.1 | 2,345.5 | 7,258.3 | 8,083.7 | |||||||||
Operating expenses: | |||||||||||||
Loss and loss adjustment expenses | 711.4 | 565.0 | 25.9 | 2,596.6 | 2,440.2 | 6.4 | |||||||
Sales and general expenses | 975.7 | 1,114.7 | (12.5) | 3,843.6 | 4,719.2 | (18.6) | |||||||
Interest and other charges | 16.4 | 16.8 | (1.9) | 70.5 | 66.7 | 5.7 | |||||||
Total operating expenses | 1,703.6 | 1,696.5 | 0.4 % | 6,510.8 | 7,226.3 | (9.9) % | |||||||
Pretax income | 237.4 | 649.0 | 747.4 | 857.4 | |||||||||
Income taxes | 46.7 | 136.8 | 148.7 | 170.9 | |||||||||
Net income | $ 190.6 | $ 512.1 | $ 598.6 | $ 686.4 | |||||||||
COMMON STOCK STATISTICS: | |||||||||||||
Components of net income per share: | |||||||||||||
Basic net income excluding investment gains (losses) | $ 0.70 |
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