Bowhead Specialty (BOW) Q2 2024 earnings summary

Executive summary

• Completed an IPO in May 2024, raising $131 million in net proceeds and began trading on NYSE under symbol BOW.

• Gross written premiums rose 50.4% year-over-year to $175.5 million for Q2 2024, driven by growth across all divisions and platform expansion.

• Operates primarily in the specialty excess and surplus (E&S) insurance market, focusing on underwriting profitability and a fully integrated value chain.

• Net income for Q2 2024 was $5.5 million ($0.20 per diluted share), with adjusted net income at $7.9 million ($0.28 per diluted share).

• Maintained a strong capital position with $339.9 million in equity as of June 30, 2024.

Financial highlights

• Net earned premiums increased 46.8% year-over-year to $90.1 million in Q2 2024.

• Net investment income more than doubled to $8.8 million, with portfolio yield at 4.6% and new money rate at 5.5%.

• Combined ratio was 99.3%, up from 92.8% in Q2 2023, reflecting higher loss and expense ratios.

• Return on equity for Q2 2024 was 8.2%, with adjusted return on equity at 11.7%.

• Book value per share rose 30% from year-end to $10.41.

Outlook and guidance

• Management expects continued premium growth, supported by favorable E&S market conditions and expanded distribution.

• Baleen division, launched late Q2, will report its first full quarter of gross written premiums in Q3 2024.

• Tax rate expected to remain around 25.3%.

• Focus remains on underwriting profitability and prudent capital management through market cycles.