Executive Summary

Q4 2024 delivered strong top-line growth but softer profitability: GPW up 25% YoY to $543.9M, NPE up 31.6% to $481.9M, but combined ratio rose to 95.4% (vs. 90.2% LY) and diluted EPS fell to $0.32, driven primarily by catastrophe losses from Hurricanes Milton and Helene; underwriting income was $22.4M .
Management highlighted an “exceptional” FY 2024: net income of $400M (+55% YoY), ROAE 18.3%, BVPS +23.5% to $22.95, with $362M total investment return including a 16.3% return from the Two Sigma Hamilton Fund (TSHF) .
Forward look: CFO guided corporate expenses to $50–$55M per year and continues to plan for ~10% annual TSHF returns; management expects another ~$80M GPW uplift in 2025 tied to the 2024 AM Best upgrade and sees attractive casualty reinsurance and selective property opportunities into mid-year renewals .
Near-term swing factor: LA wildfires loss estimate of $120–$150M (net of reinsurance and reinstatement) to be recorded in Q1 2025; predominantly a reinsurance event for HG .

What Went Well and What Went Wrong

What Went Well

Diversified growth and scale: Q4 GPW +25.4% YoY; both segments grew, with International GPW +28.2% and Bermuda GPW +20.7%, supporting NPE +31.6% to $481.9M .
Underwriting discipline despite cats: Q4 attritional loss ratio improved to 51.2% (–200 bps YoY) on absence of large losses; acquisition cost ratio decreased to 22.0% on reduced profit commissions and higher ceding commissions .
Investments: Q4 TSHF contributed $67M (3.7%) despite fixed income mark-to-market losses; FY 2024 total investment return reached $361.9M (TSHF +$274.5M; fixed income +$87.4M) .

Selected quotes

“2024 was an exceptional year for Hamilton… net income was $400 million… book value per common share increased 23.5%.” – CEO Pina Albo .
“The loss ratio increased… primarily driven by $49 million of catastrophe losses… Hurricane Milton $38M and Helene $19M.” – CFO Craig Howie (Q4) .

What Went Wrong

Higher cat activity pressured margins: Q4 combined ratio rose to 95.4% vs. 90.2% YoY; loss & LAE ratio up 680 bps to 60.1% due to $49.1M cat losses (Milton, Helene, Calgary hail) .
Investment headwind in fixed income: Q4 fixed income/short-term/cash produced a $(31.3)M mark-to-market loss due to rising Treasury yields, partly offset by TSHF gains .
Bermuda quarterly result more cat-exposed: Bermuda Q4 combined ratio 94.3% vs. 79.6% LY, reflecting $31.5M cat losses; segment underwriting income declined (to $13.2M from $34.2M) .

Financial Results

Headline Results (Group)

Metric	Q4 2023	Q3 2024	Q4 2024
Gross Premiums Written ($M)	$433.8	$553.4	$543.9
Net Premiums Earned ($M)	$366.1	$448.8	$481.9
Underwriting Income ($M)	$36.0	$29.1	$22.4
Combined Ratio (%)	90.2%	93.6%	95.4%
Net Income to Common ($M)	$126.9	$78.3	$33.9
Diluted EPS ($)	$1.15	$0.74	$0.32

Segment Breakdown

Segment	Metric	Q4 2023	Q3 2024	Q4 2024
International	GPW ($M)	$273.5	$325.5	$350.5
	NPE ($M)	$198.7	$225.2	$249.2
	Underwriting Income ($M)	$1.9	$5.4	$9.3
	Combined Ratio (%)	99.1%	97.6%	96.3%
Bermuda	GPW ($M)	$160.3	$227.9	$193.5
	NPE ($M)	$167.4	$223.6	$232.6
	Underwriting Income ($M)	$34.2	$23.7	$13.2
	Combined Ratio (%)	79.6%	89.4%	94.3%

Key Performance Indicators

KPI	Q4 2023	Q3 2024	Q4 2024
Attritional Loss Ratio – Current Year	53.2%	53.2%	51.2%
Cat Loss Ratio – Current Year	1.9%	11.5%	11.9%
Loss & LAE Ratio	53.3%	61.0%	60.1%
Acquisition Cost Ratio	24.2%	22.8%	22.0%
Other UW Expense Ratio	12.7%	9.8%	13.3%
Combined Ratio	90.2%	93.6%	95.4%
Book Value per Share ($)	$18.58	$22.82	$22.95
ROAE (Annualized)	26.4%	13.8%	5.8%

Why the quarter moved:

Loss ratio higher on cats: $49.1M of net cat losses (Milton $37.8M, Helene $18.7M, Calgary hail $0.6M, offset by $8.0M favorable PYD) .
Attritional improved: Absence of large losses in Q4 drove the 51.2% attritional loss ratio (–200 bps YoY) .
Investment mixed: TSHF +$67.0M in Q4; fixed income mark-to-market loss of $(31.3)M on rising yields .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Corporate Expenses	FY 2025 run-rate	~$50M (Q2 commentary)	$50–$55M per year (run-rate)	Slightly raised range
TSHF Expected Return (planning)	Ongoing	~10% per year	~10% per year (plan unchanged)	Maintained
Bermuda GPW uplift from AM Best upgrade	FY 2025	~$80M benefit in 2024	Similar ~$80M again in 2025	Maintained outlook
LA Wildfires Loss Estimate (net of RI & reinstatement)	Q1 2025	—	$120–$150M; predominantly reinsurance	New
Share Repurchase Authorization	Ongoing	$150M authorized (Q2)	$122M remaining as of Q4; opportunistic below BVPS	Maintained

Earnings Call Themes & Trends

Topic	Q2 2024 (Q-2)	Q3 2024 (Q-1)	Q4 2024 (Current)	Trend
Catastrophe exposure/impact	No cat losses; 84.4% CR; higher attachment points and portfolio actions reduced frequency exposure .	Helene/Debby/calgary hail drove cat loss ratio 11.5% in Q3 .	Milton and Helene drove $49M cat losses in Q4; CR 95.4% .	Higher cat activity in H2; disciplined attachment maintained.
Casualty reinsurance posture	Selectively building with strong clients; explicit inflation/social inflation in pricing .	Continued growth in casualty QS with improved terms/commissions .	Leaning in as peers pull back; selective, benefits from AM Best upgrade .	Increasing opportunities, cautious underwriting maintained.
Property market dynamics	Favorable terms, conditions, attachment points; mid-year renewals successful .	Hurricane Milton estimate guided for Q4; property still attractive .	1/1 saw capacity oversupply and some rate pressure, but elevated attachments intact; mid-year loss-affected accounts expected to see increases .	Stable-to-strong after loss-affected renewals; attachments supportive.
Reserves & social inflation	Conservative stance; third-party actuary reviews; quick to recognize adverse trends .	Favorable reserve development YTD .	11th consecutive year of favorable reserve development; surplus above actuary best estimate increased .	Confidence reinforced; continued external validation.
Capital management	$150M buyback authorization announced; timing risk-based .	Book value per share $22.82 (+22.8% YTD) .	$18M repurchased in Q4; $122M remaining; repurchases below BVPS (~18% discount avg) .	Ongoing accretive buybacks, disciplined.
Investment performance (TSHF)	Strong: 12.9% YTD through July .	Q3 TSHF –0.6% quarter; 12.2% YTD .	Q4 TSHF +3.7%; FY 16.3% .	Solid year with Q4 rebound; plan for ~10% going forward.

Management Commentary

Strategy and performance: “2024 was an exceptional year… combined ratio of 91.3%… book value per common share increased 23.5%… investment portfolio produced $362 million in total returns, including a 16.3% return from the Two Sigma Hamilton Fund.” – Pina Albo, CEO .
Q4 drivers: “Loss ratio increased due to catastrophe losses… $49M… Milton $38M and Helene $19M… offset by $8M favorable prior year development.” – Craig Howie, CFO .
Expense outlook and planning: “Going forward [corporate expenses] should come down to about $50–$55 million per year.” – Craig Howie .
Market/renewals: “At 1/1… oversupply of capacity and some rate pressure [in property cat], but elevated attachment points remained intact… expect higher demand and rate increases for loss-affected accounts at midyear.” – Pina Albo .
Wildfires loss estimate: “Early views indicate a range of $120–$150 million net of reinsurance and reinstatement premiums… will be reported in Q1 2025.” – Pina Albo .

Q&A Highlights

International attritional LR strength: Q4 insurance underlying loss ratio benefited from absence of large losses and property reserve reviews; full-year attritional ~53.5% is the better go-forward proxy .
Casualty reinsurance appetite: HG is selectively leaning into casualty reinsurance as competitors retrench, aided by the AM Best upgrade; focus on clients retaining risk and underwriting discipline .
Property environment: Property insurance/reinsurance still attractive (despite modest pressure at 1/1); elevated attachments persist; expect rate increases for loss-affected mid-year renewals .
Wildfires exposure: LA wildfires loss expected to be predominantly a reinsurance event for HG; estimate $120–$150M net .
Investment/NCI mechanics: NCI step-up reflects TSHF incentive fees; TSHF delivered 16.3% FY return; fixed income losses in Q4 driven by higher yields .
Retention/net-to-gross: Net retention increased post-IPO to enhance operating leverage; expected relatively flat in near-term .

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable at time of analysis due to S&P data access limits; as a result, we cannot quantify beats/misses versus consensus for this quarter. We attempted to retrieve consensus but were unable to do so due to vendor request limits (S&P Global Capital IQ) [GetEstimates error].
Implication: Absent consensus, focus centers on sequential and YoY trends and management color; the primary deltas vs. expectations likely hinged on cat losses (Milton/Helene) and fixed income marks that reduced investment contribution in Q4 .

Key Takeaways for Investors

Solid top-line momentum with disciplined underwriting: 25% GPW and 32% NPE growth in Q4 underscores franchise momentum, though Q4 profitability reflected elevated cat activity; attritional metrics and expense leverage remain supportive .
2024 step-change in earnings power: $400M net income, 18.3% ROAE and +23.5% BVPS reflect combined underwriting and investment execution; TSHF continues to be a differentiated return driver (16.3% FY) .
Near-term headwind likely in Q1 2025 from LA wildfires ($120–$150M net); predominantly reinsurance; monitor how loss-affected renewals reprice mid-year and how this influences 2H 2025 margins .
Casualty reinsurance opportunity set remains attractive; AM Best upgrade should continue to add ~$80M GPW in 2025 (similar to 2024), with selection and client quality key to sustaining reserve strength amid social inflation .
Expense and capital return: Corporate expense run-rate guided to $50–$55M; $122M remains under buyback authorization, with repurchases below BVPS accretive to BVPS/EPS .
Investment cadence: Expect normalized ~10% TSHF annual return planning assumption; fixed income marks are sensitive to rates, but carry income supports earnings as yields remain elevated .
Trading setup: Stock narrative likely toggles on (a) Q1 wildfire charge magnitude, (b) mid-year renewal pricing for loss-affected programs, (c) sustained NPE growth with expense leverage, and (d) cadence of buybacks below BVPS .

Notes and sources: All data and quotations are sourced from Hamilton’s Q4 2024 8-K earnings materials and financial supplement, and the Q4 2024 earnings call transcript, as cited inline . S&P Global consensus estimates were attempted but not retrieved due to request limits (no consensus comparison presented).

Hamilton Insurance Group, Ltd. (HG)·Q4 2024 Earnings Summary