Arch Capital's Q3 Earnings Align with Expectations, Revenue Surpasses Estimates

NEW YORK - Arch Capital Group Ltd (NASDAQ:ACGL) reported third-quarter earnings in line with analyst expectations, revealing significant catastrophic events during the quarter, while its revenue surpassed forecasts.

The Bermuda-based insurance and reinsurance company announced earnings of $1.99 per share, aligning with analyst estimates. The net premiums written for the quarter amounted to $4.05 billion, exceeding the consensus estimate of $3.93 billion. The company's shares rose by 0.45% following the announcement.

Arch Capital reported net income attributable to common shareholders of $978 million or $2.56 per share, representing an annualized return on average equity of 19.0%. This figure compared to $713 million or $1.88 per share in the same quarter last year.

The company faced $450 million in pre-tax current accident year catastrophe losses from the insurance and reinsurance segments, partly due to Hurricane Idalia and other global events. Despite these challenges, Arch Capital reported a positive development of $119 million in loss reserves from the previous year.

CEO Nicolas Papadopoulo commented on the results: "Our third-quarter results demonstrate the value of our diversified platform with excellent profit contributions from all our units. Arch's culture of adapting to changing market conditions while maintaining underwriting discipline continues to be a key element of our long-term success."

The combined ratio, excluding catastrophic activity and prior year developments, stood at 78.3%. This was compared to 77.0% in the third quarter of 2023. The book value per share increased by 8.1% from the previous quarter to $57.00 as of September 30, 2024.