James River Group Holdings, Ltd. (NASDAQ:JRVR) Q3 2018 Earnings Conference Call Transcript

Nov 08, 2018 • 08:00 am ET


James River Group Holdings, Ltd. (NASDAQ:JRVR) Q3 2018 Earnings Conference Call Transcript


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Good day, ladies and gentlemen, and welcome to third quarter 2018 James River Group Ltd. earnings conference call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions will follow at that time. (Operator Instructions) As a reminder, this conference call is being recorded.

I would now like to turn the conference over to your host, Kevin Copeland, Head of Investor Relations. You may begin, sir.

Kevin Copeland

Thank you, Nicole. Good morning everyone and welcome to the James River Group third quarter 2018 earnings conference call. During the call, we will be making forward-looking statements. These statements are based on current beliefs, intentions, expectations, and assumptions that are subject to various risks and uncertainties, which may cause actual results to differ materially. For a discussion of such risks and uncertainties, please see the cautionary language regarding forward-looking statements in yesterday's earnings release and the Risk Factors section of our most recent Form 10-K, Form 10-Qs, and other reports and filings we make with the Securities and Exchange Commission. We do not undertake any duty to update any forward-looking statements.

I will now turn the call over to Bob Myron, President and Chief Executive Officer of James River Group.

Robert Myron

Thank you, Kevin, and good morning, everyone. This is Bob Myron, President and CEO, and with me today are Sarah Doran, our CFO, and Kevin Copeland, our Chief Investment Officer, who you just heard from us and who also leads Investor Relations. We have a few prepared remarks and then we look forward to taking your questions.

We have posted another solid quarter and we've generated an annualized return on tangible equity of 15.1% for the year-to-date, well above our guidance of 12% or greater. We had good top and bottom line performance in each of our three segments with underwriting results showing an overall improvement from a year ago, as highlighted in our press release.

Our combined ratio for the Group came in at 96.0% and we had good combined ratios at all three segments. We didn't have any material property losses in the quarter from any of the noteworthy catastrophic events or otherwise, nor do we currently anticipate any material losses from events in the fourth quarter to-date. We had net adverse loss reserve development in two of our segments, but it didn't have a significant impact on our underwriting results. Pricing continues to be attractive in our E&S book and I expect market conditions will continue to be positive going forward.

Our Specialty Admitted segment continued to see favorable loss emergence (inaudible) year-to-date, and this quarter generated a combined ratio of 87.3%, its lowest in recent memory, as our fronting business is now a meaningful contributor to the segment. Our investment performance was again very strong.

Let me talk about a few of these things in some more detail, and then I'll hand it over to Sarah. Regarding growth, in our E&S segment, we had strong growth overall, growing in eight of our