AmTrust Financial Services (AFSI), the parent company of Warrantech, issued strong fourth quarter and year-end earnings today with significant momentum for 2015.
For the fourth quarter, the company’s earnings per share (EPS) beat the $1.20 EPS street estimate by $0.26. Gross written premium (GWP) for 2014 was $1.46 billion, up 38% from the same period last year. Small Commercial Business contributed 49% of total company GWP in 2014 and grew by 81% from 2013 to 2014.
On a profitability basis for 2014, the company is running at a loss ratio of 66.4% and an expense ratio just over 24%. Precisely, AFSI’s year-end combined ratio was 90.7%, up only 0.2% points from last year.
Lastly, the company booked $101.7 million in service and fee income in Q4, up 9.4% from the same time period last year. Most of that income was contributed by AMT Warranty/Warrantech, AMT Consumer Services, CNH Capital and Car Care Plan (the company’s overseas vehicle service contract operation).
A summary of Q4 results is listed below, and the earnings release is linked below as well. Thanks to all of our employees and agents who contributed to these tremendous revenue and profitability results. Keep up the great work!
Fourth Quarter 2014
• Gross written premium of $1.46 billion, up 37.9%, and net earned premium of $908.2 million, up 28.4% from the fourth quarter 2013
• Operating diluted EPS of $1.46 ($0.12 attributable to gain on life settlements) compared to $1.24 ($0.03 attributable to gain on life settlements) in the fourth quarter 2013
• Annualized operating return on common equity of 27.7% and annualized return on common equity of 16.7%
• Service and fee income of $101.7 million, up 9.4% from the fourth quarter 2013
• Operating earnings of $118.5 million compared to $98.5 million from the fourth quarter 2013
• Net income attributable to common stockholders of $71.6 million compared to $64.7 million in the fourth quarter 2013
• Diluted EPS of $0.88 compared with $0.82 in the fourth quarter 2013
• Combined ratio of 90.8% compared to 89.9% in the fourth quarter 2013
Full Year 2014
• Gross written premium of $6.09 billion, up 47.9%, and net earned premium of $3.53 billion, up 55.6% over 2013
• Operating diluted EPS of $5.75 ($0.08 attributable to gain on life settlements) compared to $3.56 ($0.03 attributable to gain on life settlements) in 2013
• Operating return on common equity of 29.9% and return on common equity of 28.4%
• Service and fee income of $409.7 million, up 23.6% from 2013
• Operating earnings of $458.4 million compared to $278.2 million in 2013
• Net income attributable to common stockholders of $434.3 million compared to $278.2 million in 2013
• Diluted EPS of $5.45 compared with $3.56 in 2013
• Combined ratio of 90.7% compared to 90.5% in 2013
• Book value per common share of $22.34, up from $17.74 at December 31, 2013
• AmTrust’s stockholders’ equity was $2.04 billion as of December 31, 2014
To view AmTrust Financial Services’ Q4/2014 earnings release, visit the Investor Relations section at http://ir.amtrustgroup.com/ or click on the following link:http://ir.amtrustgroup.com/releasedetail.cfm?ReleaseID=895835