Palomar (PLMR) Q2 2024 earnings summary

Executive summary

• Achieved record gross written premiums of $385.2 million in Q2 2024, up 40.4% year-over-year, and adjusted net income of $32 million, a 47% increase, driven by new business, strong retention, and expanded distribution.

• On track to double 2021 adjusted underwriting income within three years, with the Palomar 2X strategy ahead of schedule and adjusted ROE above 20%.

• Raised full-year 2024 adjusted net income guidance to $124–$130 million, reflecting continued robust performance.

• Announced acquisition of First Indemnity of America Insurance Company (FIA) to enter the surety market, expected to close by year-end 2024 or early 2025.

• AM Best upgraded financial strength rating to A, enhancing market opportunities and counterparty confidence.

Financial highlights

• Net earned premiums grew 47.1% year-over-year to $122.3 million in Q2 2024.

• Adjusted net income for Q2 2024 was $32 million ($1.25 per share), up from $21.8 million ($0.86 per share) in Q2 2023.

• Underwriting income rose 47% to $25.6 million; adjusted underwriting income was $32.9 million.

• Net investment income increased 43.7% to $8 million, with a 4.3% yield.

• Total stockholders’ equity reached $532.6 million as of June 30, 2024.

Outlook and guidance

• Full-year 2024 adjusted net income guidance raised to $124–$130 million, implying 36% growth at the midpoint.

• Guidance includes $6.8 million in catastrophe losses for H1 and $5–$7 million for Q3, but excludes FIA acquisition impact.

• Management expects continued premium growth from new products, partnerships, and expanded distribution.

• Liquidity and capital resources are considered sufficient to support ongoing operations and growth initiatives.