Old Republic International Corp (ORI, Financial) released its earnings report on October 26, 2023, revealing a mixed performance across its business segments. The company reported a pretax income, excluding investment losses, of $250.8 million for the third quarter and $701.2 million for the first nine months of 2023.
Financial Performance Highlights
General Insurance pretax operating income rose 28.6% for the quarter and 32.3% for the first nine months, driven by solid underwriting income and higher net investment income. The consolidated combined ratio was 91.9% for the quarter and 92.4% for the first nine months.
However, Title Insurance results declined in both periods, affected by higher mortgage interest rates. Consolidated net premiums and fees earned were down 9.4% for the quarter and 15.1% for the first nine months. Title Insurance dropped as a result of lower revenues in both direct and agency operations, while General Insurance grew by 10.6% for the quarter and 7.3% for the first nine months.
Investment Performance and Shareholder Returns
Net investment income increased significantly in the quarter and the first nine months, primarily due to higher investment yields earned on fixed income securities. During the quarter, the Company returned total capital to shareholders of approximately $192 million, comprised of $68 million in dividends, and $124 million of share repurchases (4.7 million shares at an average price of $26.31 per share).
Balance Sheet and Equity
Book value per share grew from $21.07 at year-end 2022 to $21.37 as of September 30, 2023, primarily reflecting the addition of operating earnings less unrealized investment losses and shareholder dividends. With the addition of dividends declared during the first nine months, book value per share increased 4.9% (6.6% annualized) over year-end 2022.
Company Outlook
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 primary needs of the insurance subsidiaries' underwriting and related services business.
Explore the complete 8-K earnings release (here) from Old Republic International Corp for further details.
