HAMILTON, Bermuda, Feb. 7, 2025 /PRNewswire/ — White Mountains Insurance Group, Ltd. (NYSE: WTM) reported book value per share of $1,746 and adjusted book value per share of $1,834 as of December 31, 2024. Book value per share and adjusted book value per share both decreased 3% in the fourth quarter of 2024 and increased 6% and 8%, respectively, in the year ended December 31, 2024, including dividends.
Manning Rountree, CEO, commented, “ABVPS was down 3% in the quarter, driven primarily by mark-to-market declines in our investment portfolio, including our position in MediaAlpha. On a full-year basis, ABVPS was up 8%, driven by solid results at our operating companies and positive returns in our investment portfolio. In the quarter, Ark produced a 77% combined ratio and $264 million of gross written premiums, up 14% year-over-year. HG Global generated $18 million of gross written premiums, driven by strong primary market volume at BAM. Kudu had a tough quarter, impacted by rising interest rates and a strengthening dollar, but delivered solid results for the full year and saw the value of its portfolio of participation contracts cross the $1 billion threshold. Bamboo had another strong quarter, with managed premiums and adjusted EBITDA up significantly year-over-year. MediaAlpha’s share price declined 38% in the quarter, producing a $122 million mark-to-market loss on our position. Excluding MediaAlpha, investment returns were down slightly in the quarter but up 6.5% for the year, a solid result. Undeployed capital stands at roughly $700 million, including the proceeds of our recent debt recap at Bamboo.”
Comprehensive income (loss) attributable to common shareholders was $(131) million and $230 million in the fourth quarter and year ended December 31, 2024 compared to $288 million and $511 million in the fourth quarter and year ended December 31, 2023. Results in the fourth quarter and year ended December 31, 2024 included $(122) million and $38 million of net realized and unrealized investment gains (losses) from White Mountains’s investment in MediaAlpha compared to $66 million and $27 million of unrealized investment gains in the fourth quarter and year ended December 31, 2023.
Ark/WM Outrigger
The Ark/WM Outrigger segment’s combined ratio was 77% and 82% in the fourth quarter and year ended December 31, 2024 compared to 69% and 80% in the fourth quarter and year ended December 31, 2023. Ark/WM Outrigger reported gross written premiums of $264 million and $2,207 million, net written premiums of $239 million and $1,679 million and net earned premiums of $415 million and $1,588 million in the fourth quarter and year ended December 31, 2024 compared to gross written premiums of $232 million and $1,898 million, net written premiums of $215 million and $1,521 million and net earned premiums of $362 million and $1,410 million in the fourth quarter and year ended December 31, 2023.
Ark’s combined ratio was 77% and 83% in the fourth quarter and year ended December 31, 2024 compared to 70% and 82% in the fourth quarter and year ended December 31, 2023. Ark’s combined ratio included 27 points of catastrophe losses in the fourth quarter of 2024, driven primarily by Hurricanes Milton and Helene, compared to negligible new catastrophe losses in the fourth quarter of 2023. Ark’s combined ratio included 13 points of catastrophe losses in the year ended December 31, 2024, driven primarily by Hurricanes Milton, Helene, Debby and Beryl, compared to two points of catastrophe losses in the year ended December 31, 2023, driven primarily by Hurricanes Otis and Idalia as well as the Maui wildfires. Ark’s combined ratio included seven points and four points of net favorable prior year development in the fourth quarter and year ended December 31, 2024 compared to two points of net unfavorable prior year development in both the fourth quarter and year ended December 31, 2023. Net favorable development for the fourth quarter of 2024 was driven primarily by the specialty line of business. Net favorable development for the year ended December 31, 2024 was driven primarily by specialty and property lines of business. Net unfavorable development for the fourth quarter and year ended December 31, 2023 was driven primarily by Hurricane Ian and Winter Storm Elliott.
Ark reported gross written premiums of $264 million and $2,207 million, net written premiums of $234 million and $1,593 million and net earned premiums of $389 million and $1,500 million in the fourth quarter and year ended December 31, 2024 compared to gross written premiums of $232 million and $1,898 million, net written premiums of $213 million and $1,411 million and net earned premiums of $334 million and $1,305 million in the fourth quarter and year ended December 31, 2023.
Ark reported pre-tax income of $51 million and $253 million in the fourth quarter and year ended December 31, 2024 compared to $109 million and $249 million in the fourth quarter and year ended December 31, 2023. Ark’s results included net realized and unrealized investment gains (losses) of $(34) million and $50 million in the fourth quarter and year ended December 31, 2024 compared to $50 million and $86 million in the fourth quarter and year ended December 31, 2023.
Ian Beaton, CEO of Ark, said, “Ark had a good quarter and full year, producing combined ratios of 77% and 83%, respectively. Full year gross written premiums were $2.2 billion, up 16% year-over-year, aided by new underwriting teams and products. In November, AM Best affirmed Ark’s ‘A/stable’ financial strength rating. Although the rate environment is moderating, we continue to see opportunities for profitable growth in 2025.”
WM Outrigger Re’s combined ratio was 86% and 60% in the fourth quarter and year ended December 31, 2024 compared to 55% and 44% in the fourth quarter and year ended December 31, 2023. Catastrophe losses in 2024 included Hurricanes Milton, Helene, Debby and Beryl. Major catastrophe losses affecting WM Outrigger Re in 2023 were minimal. WM Outrigger Re reported gross and net written premiums of $5 million and $87 million and net earned premiums of $25 million and $88 million in the fourth quarter and year ended December 31, 2024 compared to gross and net written premiums of $2 million and $110 million and net earned premiums of $29 million and $104 million in the fourth quarter and year ended December 31, 2023. Net earned premiums in the year ended December 31, 2024 decreased due to White Mountains’s lower capital commitment to WM Outrigger Re in 2024 compared to 2023.
WM Outrigger Re reported pre-tax income of $6 million and $46 million in the fourth quarter and year ended December 31, 2024 compared to $16 million and $69 million in the fourth quarter and year ended December 31, 2023. During the fourth quarter of 2024, Ark renewed Outrigger Re Ltd. for the 2025 underwriting year. White Mountains’s total commitment toward the 2025 underwriting year is $150 million.
The California wildfires represent a significant industry loss event in the first quarter of 2025. Industry estimates are still preliminary and range widely. Ark/WM Outrigger will have exposure to this event primarily through the property line of business. There is also potential for limited specialty and excess casualty claims over time. Ark does not participate on the reinsurance program backing the California FAIR plan. At this time, Ark does not expect the wildfire losses will cause full year 2025 actual catastrophe losses for Ark/WM Outrigger to diverge materially from 2025 planned catastrophe losses.
HG Global
HG Global reported gross written premiums of $18 million and $52 million and earned premiums of $7 million and $29 million in the fourth quarter and year ended December 31, 2024 compared to gross written premiums of $18 million and $50 million and earned premiums of $7 million and $26 million in the fourth quarter and year ended December 31, 2023. HG Global reported gross written premiums net of ceding commission paid of $13 million and $37 million in the fourth quarter and year ended December 31, 2024 compared to $13 million and $35 million in the fourth quarter and year ended December 31, 2023. HG Global’s total par value of policies assumed, which represents its first-loss exposure on policies assumed from BAM, was $940 million and $2,952 million in the fourth quarter and year ended December 31, 2024 compared to $762 million and $2,356 million in the fourth quarter and year ended December 31, 2023. HG Global’s total gross pricing was 190 and 177 basis points in the fourth quarter and year ended December 31, 2024 compared to 239 and 213 basis points in the fourth quarter and year ended December 31, 2023.
HG Global reported pre-tax income (loss) of $(20) million and $(66) million in the fourth quarter and year ended December 31, 2024 compared to $34 million and $56 million in the fourth quarter and year ended December 31, 2023. HG Global’s results included net realized and unrealized investment gains (losses) of $(20) million and $(6) million in the fourth quarter and year ended December 31, 2024 compared to $25 million and $14 million in the fourth quarter and year ended December 31, 2023, driven by the movement of interest rates. HG Global’s results in the year ended December 31, 2024 included the unrealized loss on deconsolidation of BAM of $115 million related to the fair value of the BAM surplus notes. In addition, HG Global’s results in the fourth quarter of 2024 included a $15 million decrease in the fair value of the BAM surplus notes, which was driven by the increase in market interest rates.
The fair value of the BAM surplus notes was $382 million as of December 31, 2024 compared to $411 million as of September 30, 2024. The decrease of $29 million in the fourth quarter of 2024 was driven by a $22 million cash payment of principal and interest and the $15 million decrease in fair value, partially offset by $8 million of accrued interest.
Kevin Pearson, President of HG Global, said, “HG Global recorded a strong quarter to close out the year, with a record quarter for par value assumed, as annual new issuance of municipal bonds exceeded $500 billion for the first time. For the full year, gross written premium assumed grew 5%, driven by strong primary market volume, partially offset by lower primary market pricing and lower secondary market activity.”
BAM, and in turn HG Global, does not expect any impact to its portfolio of insured municipal credits from the recent California wildfires.
We encourage you to read BAM’s fourth quarter statutory financial statements and operating supplement, which are expected to be available in mid-February on BAM’s website at https://bambonds.com/about-bam/credit-rating-and-finanical-information/.
Kudu
Kudu reported total revenues of $(9) million, pre-tax loss of $20 million and adjusted EBITDA of $14 million in the fourth quarter of 2024 compared to total revenues of $88 million, pre-tax income of $75 million and adjusted EBITDA of $22 million in the fourth quarter of 2023. Total revenues, pre-tax income (loss) and adjusted EBITDA included $17 million of net investment income in the fourth quarter of 2024 compared to $27 million in the fourth quarter of 2023. Net investment income in the fourth quarter of 2023 included a $12 million realization of carried interest for one of Kudu’s participation contracts. Total revenues and pre-tax income (loss) also included $(26) million of net realized and unrealized investment gains (losses) in the fourth quarter of 2024 compared to $61 million in the fourth quarter of 2023.
Kudu reported total revenues of $119 million, pre-tax income of $81 million and adjusted EBITDA of $55 million in the year ended December 31, 2024 compared to total revenues of $177 million, pre-tax income of $137 million and adjusted EBITDA of $57 million in the year ended December 31, 2023. Total revenues, pre-tax income and adjusted EBITDA included $67 million of net investment income in the year ended December 31, 2024 compared to $71 million in the year ended December 31, 2023. Total revenues and pre-tax income also included $51 million of net realized and unrealized investment gains in the year ended December 31, 2024 compared to $106 million in the year ended December 31, 2023.
Rob Jakacki, CEO of Kudu, said, “Kudu proved resilient in a tough fourth quarter and delivered solid full year results. The fair value of Kudu’s continuing portfolio declined 3% in the quarter, impacted by rising interest rates and a strengthening U.S. dollar. For the full year, Kudu produced a return on equity of 9% and annualized adjusted EBITDA of $61 million. We are pleased to have closed two new capital deployments in the quarter: Revelation Partners and RiverNorth Capital. Kudu’s portfolio value has now surpassed the $1 billion milestone, and we continue to pursue a robust pipeline in 2025.”
Bamboo
Bamboo reported commission and fee revenues of $37 million and $135 million and pre-tax income of $10 million and $33 million in the fourth quarter and year ended December 31, 2024. Bamboo reported MGA pre-tax income of $11 million and $32 million and MGA adjusted EBITDA of $16 million and $53 million in the fourth quarter and year ended December 31, 2024.
Managed premiums, which represent the total premiums placed by Bamboo, were $127 million and $484 million in the fourth quarter and year ended December 31, 2024 compared to $75 million and $215 million in the fourth quarter and year ended December 31, 2023. The increase in managed premiums was driven primarily by growth in new business volume as well as a growing renewal book.
John Chu, CEO of Bamboo, said, “Bamboo had a strong fourth quarter to close out an excellent year. For the full year, managed premiums more than doubled to $484 million, and MGA adjusted EBITDA grew to $53 million, up seven-fold year-over-year. We expect to see continued growth in 2025, although our immediate focus is on supporting our policyholders impacted by the wildfires in Los Angeles.”
Given its focus on the residential property market in California, Bamboo has exposure to the recent California wildfires. Bamboo does not expect the wildfires will have a material impact on its MGA earnings in the first quarter of 2025. Bamboo’s fronted programs will incur losses, which are estimated to be well within the reinsurance limits supporting those programs. The bulk of the losses will therefore be absorbed by Bamboo’s catastrophe excess of loss and quota share reinsurance partners. Bamboo’s captive insurance company will retain a share of the losses, which Bamboo expects to be capped at roughly $3 million. The treaty year for Bamboo’s largest MGA program renews on April 1. The impact of this event on go-forward primary market conditions and reinsurance renewal terms and conditions is yet to be determined, with a number of forces at work.
On January 24, 2025, Bamboo received the proceeds of a new $110 million, six-year term loan credit facility. In turn, Bamboo paid an $84 million cash dividend to shareholders, of which $61 million was paid to White Mountains. During the fourth quarter of 2024, Bamboo paid White Mountains $18 million in cash dividends.
MediaAlpha
As of December 31, 2024, White Mountains owned 17.9 million shares of MediaAlpha, representing a 27% basic ownership interest (25% on a fully-diluted/fully-converted basis). As of December 31, 2024, MediaAlpha’s share price was $11.29 per share, which decreased from $18.11 per share as of September 30, 2024. The carrying value of White Mountains’s investment in MediaAlpha was $202 million as of December 31, 2024 compared to $323 million as of September 30, 2024. At our current level of ownership, each $1.00 per share increase or decrease in the share price of MediaAlpha will result in an approximate $7.00 per share increase or decrease in White Mountains’s book value per share and adjusted book value per share.
We encourage you to read MediaAlpha’s fourth quarter earnings release and related shareholder letter scheduled for February 24, 2025, which will be available on MediaAlpha’s investor relations website at https://investors.mediaalpha.com.
Other Operations
White Mountains’s Other Operations reported pre-tax income (loss) of $(148) million and $9 million in the fourth quarter and year ended December 31, 2024 compared to $94 million and $113 million in the fourth quarter and year ended December 31, 2023. Net realized and unrealized investment gains (losses) from White Mountains’s investment in MediaAlpha were $(122) million and $38 million in the fourth quarter and year ended December 31, 2024 compared to $66 million and $27 million in the fourth quarter and year ended December 31, 2023. Excluding MediaAlpha, net realized and unrealized investment gains (losses) were $(3) million and $57 million in the fourth quarter and year ended December 31, 2024 compared to $63 million and $189 million in the fourth quarter and year ended December 31, 2023. Net investment income was $8 million and $36 million in the fourth quarter and year ended December 31, 2024 compared to $8 million and $30 million in the fourth quarter and year ended December 31, 2023. White Mountains’s Other Operations reported general and administrative expenses of $43 million and $170 million in the fourth quarter and year ended December 31, 2024 compared to $52 million and $182 million in the fourth quarter and year ended December 31, 2023.
In the fourth quarter and year ended December 31, 2024, White Mountains’s Other Operations reported $4 million and $9 million of pre-tax income related to the Bamboo CRV. The Bamboo CRV, which provides quota share reinsurance on one of Bamboo’s fronted programs for the treaty year ending in March 2025, expects to incur a loss in the first quarter of 2025 related to the recent California wildfires that is capped at roughly $12 million.
Investments
The total consolidated portfolio return was -2.3% in the fourth quarter of 2024. Excluding MediaAlpha, the total consolidated portfolio return was -0.4% in the fourth quarter of 2024. The total consolidated portfolio return was 5.8% in the fourth quarter of 2023. Excluding MediaAlpha, the total consolidated portfolio return was 4.8% in the fourth quarter of 2023.
The total consolidated portfolio return was 6.9% in the year ended December 31, 2024. Excluding MediaAlpha, the total consolidated portfolio return was 6.5% in the year ended December 31, 2024. The total consolidated portfolio return, both including and excluding MediaAlpha, was 11.4% in the year ended December 31, 2023.
Mark Plourde, President of White Mountains Advisors, said, “Excluding MediaAlpha, the total portfolio was down -0.4% in the quarter. Returns were impacted by rising interest rates and related mark-to-market losses. Excluding MediaAlpha, the total portfolio was up 6.5% for the year, a solid result. Our short duration fixed income portfolio returned -0.3% in the quarter and 4.3% for the year, compared to the Bloomberg Intermediate Aggregate Index returns of -2.1% and 2.5%. The equity portfolio, excluding MediaAlpha, returned -0.6% in the quarter and 9.4% for the year, compared to the S&P 500 Index returns of 2.4% and 25.0%. Relative underperformance was attributable to our portfolio of international common stocks and other long-term investments.”
Additional Information
White Mountains is a Bermuda-domiciled financial services holding company traded on the New York Stock Exchange under the symbol WTM and the Bermuda Stock Exchange under the symbol WTM.BH. Additional financial information and other items of interest are available at the Company’s website located at www.whitemountains.com. White Mountains expects to file its Form 10-K on or before February 28, 2025 with the Securities and Exchange Commission and urges shareholders to refer to that document for more complete information concerning its financial results.
CONTACT: Rob Seelig
(603) 640-2212
WHITE MOUNTAINS INSURANCE GROUP, LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
(millions)
(Unaudited)
December 31, 2024
September 30, 2024
December 31, 2023
Assets
P&C Insurance and Reinsurance (Ark/WM Outrigger)
Fixed maturity investments
$ 1,565.1
$ 1,461.2
$ 866.8
Common equity securities
425.4
435.6
400.6
Short-term investments
601.4
579.1
962.8
Other long-term investments
547.8
544.8
440.9
Total investments
3,139.7
3,020.7
2,671.1
Cash (restricted $14.1, $3.3, $0.7)
141.2
148.8
90.5
Reinsurance recoverables
589.0
748.0
442.0
Insurance premiums receivable
768.6
993.0
612.2
Deferred acquisition costs
165.2
199.7
145.3
Goodwill and other intangible assets
292.5
292.5
292.5
Other assets
202.8
175.8
125.0
Total P&C Insurance and Reinsurance assets
5,299.0
5,578.5
4,378.6
Financial Guarantee (HG Global)
Fixed maturity investments
612.1
636.1
1,012.3
Short-term investments
55.5
34.6
70.6
Total investments
667.6
670.7
1,082.9
Cash
11.5
1.2
6.7
BAM surplus notes, at fair value
381.7
411.1
—
Insurance premiums receivable
4.4
7.9
5.5
Deferred acquisition costs
86.6
83.2
40.1
Other assets
27.6
27.8
36.8
Total Financial Guarantee assets
1,179.4
1,201.9
1,172.0
Asset Management (Kudu)
Short-term investments
27.9
20.3
29.3
Other long-term investments
1,014.0
936.8
896.3
Total investments
1,041.9
957.1
925.6
Cash
.6
76.7
1.4
Accrued investment income
18.0
15.7
17.6
Goodwill and other intangible assets
8.0
8.0
8.3
Other assets
39.9
36.6
6.5
Total Asset Management assets
1,108.4
1,094.1
959.4
P&C Insurance Distribution (Bamboo)
Fixed maturity investments
40.7
38.9
—
Short-term investments
17.3
14.6
—
Total investments
58.0
53.5
—
Cash (restricted $59.5, $67.7, $0.0)
74.5
91.1
—
Premiums, commissions and fees receivable
70.0
72.7
—
Goodwill and other intangible assets
355.0
359.0
—
Other assets
27.1
23.3
—
Total P&C Insurance Distribution assets
584.6
599.6
—
Other Operations
Fixed maturity investments
293.7
286.1
230.2
Common equity securities
224.6
219.8
137.8
Investment in MediaAlpha
201.6
323.4
254.9
Short-term investments
262.1
241.7
425.2
Other long-term investments
