Greenlight Capital Re Ltd. Q4 FY2024 earnings call

• The fourth quarter of 2024 was challenging with a net underwriting loss of $18 million and combined ratio of 112.1%, including cat losses and Russia-Ukraine conflict reserve strengthening. - The company split financial results into open market and innovations segments. - One-one renewals 2025 progressed well, with growth in certain areas like funded at Lloyd's book. - Solus Glass Fund had performance details, and the company grew fully diluted book value per share by 7.2% in 2024.

For the open market segment, net earned premiums in the fourth quarter of 2024 increased 25% to $127.8 million, with a combined ratio of 111.1%. For the full year 2024, open market net earned premiums grew 9.7% to $511.9 million and had a combined ratio of 99%. The innovation segment had net earned premiums in Q4 2024 decrease 18.1% to $19 million, with a combined ratio of 102.1%. For the full year 2024, innovation segment net earned premiums increased 20.3% to $86.4 million and had a combined ratio of 95.8%.

• Optimistic about 2025 opportunities despite some market softening. - Expect FAL book to grow ~25% in 2025, specialty book to grow modestly, and property portfolio to grow ~10%. - Believes the current in-force book is capable of double-digit book value per share growth.

• Catastrophic events like Hurricane Milton and Los Angeles wildfires pose risks. - Uncertainty in Russia-Ukraine conflict reserves and casualty book adverse development are risks.

Q: Could you share more on the Q4 charge related to Russia, Ukraine and its relation to ultimate industry losses?

A: Greg Richardson explained that they booked a $15 million increase in Russia-Ukraine conflict reserves due to increased settlement activity, booking it as IBNR and it's net of retrocession. Faramarz Romer added they reserved at best estimate and were anticipating claims flowing in.

Q: Any specific casualty books impacted by inflationary trends?

A: Greg Richardson said there were secondary and smaller issues in casualty books, with biggest exposure in older years, but not huge and go-forward book is smaller limits. Faramarz Romer noted favorable development on specialty lines offset some adverse in casualty.

Q: About capital allocation and MicroStrategy arbitrage?

A: David Einhorn said the MicroStrategy arbitrage has high returns due to dynamics of double-levered ETFs like decay of call options and negative gamma, annualizing nearly triple digits.