Executive Summary

Sixth consecutive profitable quarter: net income $3.88M, diluted EPS $0.27, combined ratio 93.7% as mild winter reduced catastrophe losses, partially offset by higher fire severity .
Strong growth tailwinds: net premiums earned up 51% YoY to $43.52M; Core direct premiums written grew 22.7% YoY as downstate NY opportunity continues .
Guidance reaffirmed for FY2025: combined ratio 81–85%, basic EPS $1.90–$2.30, diluted EPS $1.75–$2.15, ROE 27–35% (based on ~$184M net premiums earned) .
Significant beats vs S&P Global consensus: Operating/Primary EPS $0.17 vs $0.00 estimate; Revenue $48.53M vs $41.70M estimate; management also realized a one-time $1.97M gain on HQ sale and fully eliminated holding company debt, trimming interest expense going forward .*
Catalysts and watch items: July 1, 2025 reinsurance renewals (XOL/cat programs currently set to expire June 30), late Q3 launch of AmGUARD renewal rights program ($25–$35M estimated 12‑month premium potential), and potential dividend consideration amid capital flexibility .

What Went Well and What Went Wrong

What Went Well

Profitability durability: sixth straight profitable quarter; net income +172% YoY to $3.88M; adjusted EBITDA +45% YoY to $4.26M .
Growth and earning-in tailwinds: net premiums earned +51% YoY (surge in 2H24 new business and lower quota share); Core DPW +22.7% YoY . Quote: “Net premiums earned were exceptionally strong…a tailwind for our results throughout the year” — Meryl Golden .
Investment income and balance sheet: net investment income +36% YoY to $2.05M; $1.97M gain on HQ sale; holding company debt fully repaid, saving ~$0.8M interest annually .

What Went Wrong

Severity uptick: underlying loss ratio +3.3 pts YoY; net loss ratio ex-cat +3.9 pts as a handful of fire losses drove severity; combined ratio +0.4 pts YoY to 93.7% . Quote: “Offset by an increase in severity due to a higher incidence of fire losses…not atypical for this time of year” — Meryl Golden .
Ceding commissions down: ceding commission revenue fell to $2.96M (vs $4.57M), reflecting treaty changes and sliding-scale effects .
Tariff/macro watch: building materials cost inflation tied to tariffs could necessitate additional rate increases; management currently does not expect material impact but is monitoring .

Financial Results

Year-over-year and estimate comparison (chronological columns: Q1 2024 → Q1 2025)

Metric	Q1 2024	Q1 2025	Vs. YoY	Vs. S&P Consensus (Q1 2025)
Net Premiums Earned ($M)	$28.82	$43.52	+51.0%	—
Total Revenues ($M)	$35.77	$50.50	+41.2%	$48.53 vs $41.70 estimate (Beat)*
Net Investment Income ($M)	$1.50	$2.05	+36.3%	—
Net Loss Ratio (%)	62.0%	62.4%	+0.4 pts	—
Cat Loss Ratio (%)	5.2%	1.7%	−3.5 pts	—
Underwriting Expense Ratio (%)	31.3%	31.3%	Flat	—
Combined Ratio (%)	93.3%	93.7%	+0.4 pts	—
Net Income ($M)	$1.43	$3.88	+172.1%	—
EPS – Basic ($)	$0.13	$0.29	+123.1%	—
EPS – Diluted ($)	$0.12	$0.27	+125.0%	Primary EPS $0.17 vs $0.00 estimate (Beat)*
Adjusted EBITDA ($M)	$2.93	$4.26	+45.1%	—

Sequential multi-quarter context (chronological columns: Q3 2024 → Q4 2024 → Q1 2025)

Metric	Q3 2024	Q4 2024	Q1 2025
Net Income ($M)	$7.0	$5.4	$3.88
EPS (reported)	$0.61 basic	$0.40 diluted	$0.27 diluted; $0.29 basic
Combined Ratio (%)	72.0%	78.5%	93.7%
Net Investment Income ($M)	$1.7	$1.9	$2.05

Segment breakdown (Q1 2025)

Segment	Net Premiums Earned ($M)	Net Loss Ratio (%)	Net Loss Ratio ex-cat (%)
Core (NY)	$42.26	63.5%	62.0%
Non-Core (ex-NY)	$1.27	28.6%	18.3%

KPIs and operating drivers (Q1 2025)

KPI	Q1 2024	Q1 2025
Core Direct Premiums Written ($M)	$46.59	$57.18
Total Direct Premiums Written ($M)	$49.33	$58.18
ROE – Annualized (%)	16.4%	20.8%
Operating Net Income ($M)	$0.85	$2.44
Operating EPS – Diluted ($)	$0.07	$0.17
Weighted Avg Diluted Shares (M)	11.79	14.27

Non‑GAAP reconciliations provided in Exhibits .

Guidance Changes

Metric	Period	Previous Guidance (Q4 2024)	Current Guidance (Q1 2025)	Change
Core DPW Growth (%)	FY2025	15%–25%	15%–25%	Maintained
Combined Ratio (%)	FY2025	81%–85% (on ~$184M NPE)	81%–85% (on ~$184M NPE)	Maintained
EPS – Basic ($)	FY2025	$1.90–$2.30	$1.90–$2.30	Maintained
EPS – Diluted ($)	FY2025	$1.75–$2.15	$1.75–$2.15	Maintained
ROE (%)	FY2025	27%–35%	27%–35%	Maintained

Management noted AmGUARD transaction impacts are not yet embedded and will be assessed with updated guidance next quarter .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
Downstate NY hard market and competitor exits	Record growth and margins; Adirondack & Mountain Valley exits drove Core growth; plan to reduce quota share for 2025	Hard market persists; 23% Core DPW growth; focus on preferred risks via Select product	Sustained tailwind; growth moderating but above prior year
Select product performance	Frequency >20% lower than legacy; pricing “by-peril,” insurance score used	Select homeowners frequency 1.6% vs 2.3% legacy; expected to reach ~60% of PIF by YE	Mix shift to Select improving underwriting quality
Reinsurance costs/coverage	Expect higher cat reinsurance costs; purchased winter storm cover; assume ~6% cat load in 2025; target ~28% expense ratio	Winter mild; cat losses −3.5 pts YoY; key treaties expire June 30, 2025; renewals pending	Watch reinsurance renewal terms (July 1)
Capital management	ATM used, debt paydown planned; debt fully retired by early 2025	Debt fully repaid; board considering dividend; no near-term buybacks given growth needs	Flexibility improving; possible shareholder returns
Tariffs/inflation/supply chain	No direct hurricane impacts; reinsurance market tone tough post storms	Monitoring tariff-related building materials costs; may adjust rates; minimal expected impact	Manageable headwind if costs rise
Geographic expansion	Evaluating other states; cautious approach post-2017 lessons	2026+ strategy; 2025 focus remains NY and AmGUARD execution	Longer-term optionality

Management Commentary

“We are pleased to report increased profitability and strong premium growth…Net premiums earned were exceptionally strong…a tailwind for our results throughout the year” — Meryl Golden .
“Catastrophe losses were…below our historical run-rate driven by the mild winter…offset by an increase in severity due to a higher incidence of fire losses” — Meryl Golden .
“We fully paid off our remaining holding company debt which will save us over $800,000 in interest annually” — Meryl Golden .
On AmGUARD renewal rights: regulators approved plan; quoting expected late Q3; estimated $25–$35M premiums over 12 months; pricing likely higher than AmGUARD’s .

Q&A Highlights

Fire losses vs cat: Fire severity added ~3.3 pts attritional losses; lighter cat losses reduced ~3.5 pts; combined ratio guidance held .
Capital returns: Board actively discussing restoring dividend; no near-term buybacks given growth and surplus needs .
AmGUARD transaction: Price differential expected; potential customer “sticker shock” mitigated by AmGUARD rate increases and selective underwriting; $25–$35M 12‑month premium estimate .
CFO search: Retained firm engaged; CAO and CEO covering interim .
Investment income outlook: Portfolio growth and longer duration positioning support rising net investment income .

Estimates Context

Metric	S&P Global Consensus (Q1 2025)	Actual
Primary EPS Consensus Mean ($)	0.00*	0.17 (Operating EPS – diluted)
Revenue Consensus Mean ($M)	41.70*	48.53*

Values retrieved from S&P Global. For EPS actual, company reported diluted operating EPS $0.17 . For revenue, S&P “Revenue” series differs from GAAP total revenues ($50.50M) as it excludes certain items (e.g., real estate gains); company GAAP total revenues were $50.50M .*

Implications: Consensus appears stale/limited (one estimate each), amplifying apparent beat; Street models likely to lift operating EPS and revenue assumptions given higher earned premium run-rate and lower interest expense.

Key Takeaways for Investors

Momentum intact: strong earned premium growth and Select mix shift support operating profitability despite transient fire severity; watch attritional loss trends as Select penetration rises .
Near-term trading: Q1 beat vs minimal consensus and debt extinguishment are positive; stock may be sensitive to reinsurance renewal outcomes by July 1 (cat/XOL pricing, retentions) .
Medium-term thesis: Reaffirmed FY25 combined ratio/EPS guidance suggests durable double-digit ROE; AmGUARD onboarding in late Q3 could accelerate Core growth into 2026 .
Capital returns optionality: Debt-free status increases room for dividend restoration discussions; buybacks unlikely near term given growth/surplus priorities .
Rate adequacy and inflation: Tariff-driven materials inflation could necessitate higher rates; management updates replacement cost annually and expects limited impact .
Non-core runoff nearly complete: improving non-core loss metrics reduce drag on consolidated results .
Monitoring items: ceding commission dynamics under sliding scale; portfolio duration/yield actions; CFO hire timing; quarterly loss severity volatility (seasonal fire losses) .

* Values retrieved from S&P Global.

KINGSTONE COMPANIES, INC. (KINS)·Q1 2025 Earnings Summary