UNIVERSAL INSURANCE HOLDINGS, INC. Q4 FY2025 earnings call

• Steve Donaghy mentioned an outstanding quarter with adjusted return on common equity over 46%, capital position robust, reserves strongest in history, and progress made in 2025. • Florida's legislative reforms stabilized the market. • Well underway in negotiating 2026 reinsurance program with substantial portion of first event catastrophe tower placed and multiyear capacity secured for 2027 hurricane season. • Frank Wilcox walked through financial results including adjusted diluted earnings per share, core revenue, direct premiums written, earned, and net premiums earned, and combined ratio details. • Company repurchased ~210,000 shares at $6.9 million in Q4 and announced new share repurchase program and declared quarterly cash dividend.

Core revenue was $403.6 million, up 4.4% year-over-year. Direct premiums written were $483.7 million, up 2.7% from the prior year quarter, with an 18.2% growth in other states partially offset by a 3.1% decrease in Florida. Direct premiums earned were $538 million, up 3.6% year-over-year. Net premiums earned were $363.4 million, up 4.3% from the prior year quarter. Adjusted diluted earnings per common share was $2.17, up from $0.25 in the prior year quarter. The net combined ratio was 87.5%, down 20.4 points compared to the prior year quarter, with a net loss ratio of 61.3% (down 21 points) and a net expense ratio of 26.2% (up 0.6 points).

• Well underway in negotiating and placing 2026 reinsurance program with substantial portion of first event catastrophe tower already placed and meaningful additional multiyear capacity secured for 2027 hurricane season. • Kicked off actuarial study on rate for 2026 at end of March.

Q: Congratulations on the quarter. I was hoping you could give us a little bit more thoughts on the competitive environment today. We hear just a ton about price declines and increased folks in the market. How do you see it from your perspective?

A: Steve Donaghy said they see the competitive environment very favorable to Universal at this point, with favorable rates, more markets opened due to analyzing internal profitability model, and positive things in Florida.

Q: Do you have any thoughts on sort of the regulatory environment? And we hear a lot about the issues with affordability and whether or not the insurance industry will be asked to essentially kind of give back profits or something like that. Any exposure or thoughts on that probably?

A: Steve Donaghy said without Florida's legislative reforms, the industry wouldn't be in the current position, they kicked off actuarial study on rate for 2026 at end of March, decrease in rate doesn't always mean decrease in earnings due to favorable legislation and less severity and frequency, and retention has never been better.