Accelerant Holdings Q2 FY2025 earnings call

• Jeff Radke highlighted the success of Accelerant's 2-sided platform, organic growth, and focus on long-term shareholder value, emphasizing the company's work in modernizing the specialty insurance industry.
• Ryan Schiller discussed being the leader in specialty insurance, driving confidence through data and insights, and initiatives like machine learning-led risk indices and language models on claims data to improve portfolio profitability.
• Jay Green highlighted financial performance, including Exchange Written Premium growth to $1.1 billion, revenue up 68%, adjusted EBITDA growth, and margin expansion. Mentioned investments in the business and operating leverage, and discussed segment performance details for Exchange Services, MGA Operations, and Underwriting segments.

Exchange Services Segment: Revenue was $86 million for the quarter, growing 60% over the prior year quarter. It accounted for 8% of Exchange Written Premiums, an improvement from 7.1% in the prior year quarter. Adjusted EBITDA was $56 million, up 38% from the second quarter of 2024.

MGA Operations Segment: Revenue was $58 million, growing 77% over the prior year quarter. Adjusted EBITDA was $24 million, up from $6 million in the prior year quarter.

Underwriting Segment: Revenue was $110 million, growing 39% over the prior year period. Adjusted EBITDA was $16 million. The gross loss ratio was 50.5%, improving from 54.7% in the second quarter of 2024.

• Third quarter 2025 Exchange Written Premium is estimated to be in the range of $1.01 billion to $1.04 billion, representing growth of between 14% and 17% over the same quarterly period in 2024.
• Adjusted EBITDA from underlying business performance, excluding the sale of a minority interest, is estimated to be in the range of $41 million to $51 million, an increase of 58% to 95% over the same quarterly period in 2024.
• Including the sale of the minority interest, third quarter 2025 adjusted EBITDA is estimated to be in the range of $66 million to $81 million, an increase of 154% to 210% over the same quarterly period in 2024.

Q: What was the premium contribution from Hadron in 2Q '25 and growth of other partners?

A: Hadron wrote $170 million during the quarter of Exchange Written Premium. It's a valuable partner but expected to mix down as a percentage of total third-party insurer premium. Other third-party insurers are growing quickly, and growth is constrained by onboarding high-quality MGAs.

Q: Impact of reinsurance transactions on net retention?

A: Net retention of Exchange Written Premium was 6% in 2Q 2025 due to more business placed with third parties. Expected to trend toward historic norms of approximately 10% in future quarters.

Q: What was the gross loss ratio for the Underwriting segment in the quarter?

A: The gross loss ratio was 50.5% in the second quarter of 2025.

Q: Impact of the sale of a minority interest on adjusted EBITDA?

A: No impact on Exchange Written Premium. The transaction includes realized gains from selling a portion of the minority stake in an own member, with no material sell-down of ownership in the member.

Q: Is there seasonality to be cognizant of between third and fourth quarters?

A: No significant seasonality in the book of business as there's no variation in production or loss activity seasonally.