Release Date: March 26, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Oxbridge Re Holdings Ltd (OXBR, Financial) reported an increase in net premiums for the year ended December 31, 2024, rising to $2.3 million from $1.25 million in the prior year.
- The company successfully diversified its business by establishing SurancePlus Inc., focusing on RWA Web3 technology and tokenized reinsurance securities.
- Oxbridge Re Holdings Ltd (OXBR) maintained a consistent loss ratio of 0% for the year ended December 31, 2024, indicating strong underwriting profitability.
- The company completed a regedirect offering, raising gross proceeds of $3 million, enhancing its financial position.
- Oxbridge Re Holdings Ltd (OXBR) has initiated a strategic review process to explore various strategic alternatives, potentially increasing shareholder value.
Negative Points
- Oxbridge Re Holdings Ltd (OXBR) reported a net loss of $2.7 million for the year ended December 31, 2024, although this was an improvement from the prior year's net loss of $9.9 million.
- The company recognized a $2.1 million unrealized loss on its investment in Jet.AI, contributing to financial volatility.
- Total revenues for the fiscal year ended December 31, 2024, were $546,000, compared to a negative $7 million in the prior year, indicating ongoing revenue challenges.
- The investment portfolio decreased significantly from $680,000 to $113,000 due to the sale of equity securities and a decrease in their fair value.
- Oxbridge Re Holdings Ltd (OXBR) faces risks and uncertainties that could materially affect its business, as highlighted in their forward-looking statements caution.
Q & A Highlights
Q: Could you discuss your underwriting risk management efforts that have resulted in no losses in the last couple of quarters?
A: Sanjay Madhu, CEO, explained that Oxbridge Re reviews contracts internally and as a follow-on reinsurer, they assess who else is on the contracts. They ensure contracts are adequately priced and have turned away contracts they didn't believe in. Last year's contracts, despite a Category 3 hurricane, paid out 49% instead of the targeted 42%, showcasing their effective underwriting.
Q: When do you plan to complete the '25/'26 tokenization with targeted 20% and 42% returns?
A: Sanjay Madhu stated that they are actively working to grow this opportunity and expect funds to go live on June 1 into reinsurance contracts. They offer a 3.5% annualized dividend on funds received before June 1 to ensure investors earn income before the contracts go live.
Q: Does raising third-party money through tokenization reduce Oxbridge Re's risk profile?
A: Yes, according to Sanjay Madhu, it reduces the company's risk profile as they now include third-party funds alongside their own, lowering their risk while still earning fees on the funds. This shift from traditional reinsurance to a Web3 real-world asset company is seen as beneficial for Oxbridge and SurancePlus.
Q: Can you comment on the Florida P&C insurance market and its current state?
A: Sanjay Madhu noted that while the market may have slightly improved, the cost of reinsurance remains significant. By democratizing the asset class, Oxbridge aims to bring in new capital, potentially lowering costs and benefiting the market. They are well-positioned to capitalize on this opportunity.
Q: How do you manage potential losses from third-party money raised through tokenization?
A: Sanjay Madhu clarified that losses on third-party money do not flow through Oxbridge Re's income statement. They earn management fees without bearing the loss risk on these funds.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
