Arch Capital (ACGL) Q1 Earnings Beat, Premiums Rise Y/Y
Zacks Investment Research | May 01, 2019 01:58AM ET
Arch Capital Group Ltd. (NASDAQ:ACGL) reported first-quarter 2019 operating income per share of 67 cents, which outperformed the Zacks Consensus Estimate by 8.1%. Moreover, the bottom line improved 19.6%.
The quarter benefited from improving premiums and net investment income.
Behind the Headlines
Gross premiums written increased 13% year over year to $2.1 billion, largely fueled by higher premiums written across its Insurance, Reinsurance and Mortgage segments.
Net investment income increased more than threefold to $121.3 million, supported by reinvestment of fixed income securities at higher available yields and the shift from municipal bonds to corporates.
Operating revenues of $1.5 billion improved 12.1% year over year and beat the Zacks Consensus Estimate by nearly 15%.
Interest expense was $23.5 million, down 9.3% year over year, reflecting the paydown of revolving credit agreement borrowings in the second half of 2018.
Total expense of $1.2 billion increased 7.8% year over year on higher losses and loss adjustment expenses, acquisition expenses, other operating expenses and corporate expenses.
Arch Capital’s underwriting income came in at $260.1 million, up 9.8% year over year. Combined ratio improved 180 basis points (bps) to 81.4%.
Arch Capital Group Ltd. Price, Consensus and EPS Surprise
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