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Palomar Holdings, Inc. Reports First Quarter 2024 Results
ソース: Nasdaq GlobeNewswire / 02 5 2024 16:10:55 America/New_York
LA JOLLA, Calif., May 02, 2024 (GLOBE NEWSWIRE) -- Palomar Holdings, Inc. (NASDAQ:PLMR) (“Palomar” or “Company”) reported net income of $26.4 million, or $1.04 per diluted share, for the first quarter of 2024 compared to net income of $17.3 million, or $0.68 per diluted share, for the first quarter of 2023. Adjusted net income(1) was $27.8 million, or $1.09 per diluted share, for the first quarter of 2024 as compared to $20.4 million, or $0.80 per diluted share, for the first quarter of 2023.
First Quarter 2024 Highlights
- Gross written premiums increased by 47.2% to $368.1 million compared to $250.1 million in the first quarter of 2023
- Net income of $26.4 million, compared to $17.3 million in the first quarter of 2023
- Adjusted net income(1) of $27.8 million, compared to $20.4 million in the first quarter of 2023
- Total loss ratio of 24.9% compared to 24.8% in the first quarter of 2023
- Combined ratio of 76.9% compared to 77.9% in the first quarter of 2023
- Adjusted combined ratio(1) of 73.0%, compared to 73.3%, in the first quarter of 2023
- Annualized return on equity of 21.7%, compared to 17.5% in the first quarter of 2023
- Annualized adjusted return on equity(1) of 22.9%, compared to 20.7% in the first quarter of 2023
(1) See discussion of “Non-GAAP and Key Performance Indicators” below.
Mac Armstrong, Chairman and Chief Executive Officer, commented, “The strong results of our first quarter are a testament to Palomar's focus on profitable growth. We further demonstrated our ability to ‘grow where we want to’ and deliver predictable earnings. Our five product categories combined to generate gross written premium growth of 47.2% with especially strong contributions from our Crop and Casualty products. These younger product lines combined with our market leading Earthquake franchise, which grew 18% on a same-store basis, drove adjusted net income growth of 36.0%, and an adjusted return on equity of 22.9%."
Mr. Armstrong continued, “Our portfolio of specialty insurance products is well positioned and provides a strong foundation to our full year outlook which we have raised today. Additionally, our continued investment across the organization will sustain not only our Palomar 2X strategic plan but also deliver industry leading profitability and returns. We are off to a terrific start to the year.”
Underwriting Results
Gross written premiums increased 47.2% to $368.1 million compared to $250.1 million in the first quarter of 2023, while net earned premiums increased 29.6% compared to the prior year’s first quarter.
Losses and loss adjustment expenses for the first quarter were $26.8 million, comprised of $23.5 million of non-catastrophe attritional losses and $3.4 million of catastrophe losses from flood activity. The loss ratio for the quarter was 24.9%, comprised of a catastrophe loss ratio(1) of 3.1% and an attritional loss ratio of 21.8%, compared to a loss ratio of 24.8% during the same period last year comprised of a catastrophe loss ratio(1) of 2.2% and attritional loss ratio of 22.6%.
Underwriting income(1) for the first quarter was $25.0 million resulting in a combined ratio of 76.9% compared to underwriting income of $18.4 million resulting in a combined ratio of 77.9% during the same period last year. The Company’s adjusted underwriting income(1) was $29.2 million resulting in an adjusted combined ratio(1) of 73.0% in the first quarter compared to adjusted underwriting income(1) of $22.2 million and an adjusted combined ratio(1) of 73.3% during the same period last year.
Investment Results
Net investment income increased by 39.4% to $7.1 million compared to $5.1 million in the prior year’s first quarter. The increase was primarily due to higher yields on invested assets and a higher average balance of investments held during the three months ended March 31, 2024 due to cash generated from operations. The weighted average duration of the fixed-maturity investment portfolio, including cash equivalents, was 3.62 years at March 31, 2024. Cash and invested assets totaled $766.4 million at March 31, 2024. During the first quarter, the Company recorded net realized and unrealized gains of $3.0 million related to its investment portfolio as compared to net realized and unrealized gains of $0.1 million during the same period last year.Tax Rate
The effective tax rate for the three months ended March 31, 2024 was 23.2% compared to 23.5% for the three months ended March 31, 2023. For the current quarter, the Company’s income tax rate differed from the statutory rate due primarily to the non-deductible executive compensation expense.Stockholders’ Equity and Returns
Stockholders' equity was $501.7 million at March 31, 2024, compared to $404.6 million at March 31, 2023. For the three months ended March 31, 2024, the Company’s annualized return on equity was 21.7% compared to 17.5% for the same period in the prior year while adjusted return on equity(1) was 22.9% compared to 20.7% for the same period in the prior year. There were no share repurchases during the three months ended March 31, 2024.Full Year 2024 Outlook
For the full year 2024, the Company is increasing its guidance range and now expects to achieve adjusted net income of $113 million to $118 million. This range includes $3.4 million of catastrophe losses incurred during the three months ended March 31, 2024.Conference Call
As previously announced, Palomar will host a conference call Friday May 3, 2024, to discuss its first quarter 2024 results at 11:00 a.m. (Eastern Time). The conference call can be accessed live by dialing 1-877-423-9813 or for international callers, 1-201-689-8573, and requesting to be joined to the Palomar First Quarter 2024 Earnings Conference Call. A replay will be available starting at 4:00 p.m. (Eastern Time) on May 3, 2024, and can be accessed by dialing 1-844-512-2921, or for international callers, 1-412-317-6671. The passcode for the replay is 13745676. The replay will be available until 11:59 p.m. (Eastern Time) on May 10, 2024.Interested investors and other parties may also listen to a simultaneous webcast of the conference call by logging onto the investor relations section of the Company’s website at http://ir.palomarspecialty.com/. The online replay will remain available for a limited time beginning immediately following the call.
About Palomar Holdings, Inc.
Palomar Holdings, Inc. is the holding company of subsidiaries Palomar Specialty Insurance Company (“PSIC”), Palomar Specialty Reinsurance Company Bermuda Ltd., Palomar Insurance Agency, Inc., Palomar Excess and Surplus Insurance Company (“PESIC”), and Palomar Underwriters Exchange Organization, Inc. Palomar's consolidated results also include Laulima Reciprocal Exchange, a variable interest entity for which the Company is the primary beneficiary. Palomar is an innovative specialty insurer serving residential and commercial clients in five product categories: Earthquake, Inland Marine and Other Property, Casualty, Fronting, and Crop. Palomar’s insurance subsidiaries, Palomar Specialty Insurance Company, Palomar Specialty Reinsurance Company Bermuda Ltd., and Palomar Excess and Surplus Insurance Company, have a financial strength rating of “A-” (Excellent) from A.M. Best.To learn more, visit PLMR.com.
Non-GAAP and Key Performance Indicators
Palomar discusses certain key performance indicators, described below, which provide useful information about the Company’s business and the operational factors underlying the Company’s financial performance.
Underwriting revenue is a non-GAAP financial measure defined as total revenue, excluding net investment income and net realized and unrealized gains and losses on investments. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of total revenue calculated in accordance with GAAP to underwriting revenue.
Underwriting income is a non-GAAP financial measure defined as income before income taxes excluding net investment income, net realized and unrealized gains and losses on investments, and interest expense. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of income before income taxes calculated in accordance with GAAP to underwriting income.
Adjusted net income is a non-GAAP financial measure defined as net income excluding the impact of certain items that may not be indicative of underlying business trends, operating results, or future outlook, net of tax impact. Palomar calculates the tax impact only on adjustments which would be included in calculating the Company’s income tax expense using the estimated tax rate at which the company received a deduction for these adjustments. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of net income calculated in accordance with GAAP to adjusted net income.
Annualized Return on equity is net income expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period.
Annualized adjusted return on equity is a non-GAAP financial measure defined as adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of return on equity calculated using unadjusted GAAP numbers to adjusted return on equity.
Loss ratio, expressed as a percentage, is the ratio of losses and loss adjustment expenses, to net earned premiums.
Expense ratio, expressed as a percentage, is the ratio of acquisition and other underwriting expenses, net of commission and other income to net earned premiums.
Combined ratio is defined as the sum of the loss ratio and the expense ratio. A combined ratio under 100% generally indicates an underwriting profit. A combined ratio over 100% generally indicates an underwriting loss.
Adjusted combined ratio is a non-GAAP financial measure defined as the sum of the loss ratio and the expense ratio calculated excluding the impact of certain items that may not be indicative of underlying business trends, operating results, or future outlook. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of combined ratio calculated using unadjusted GAAP numbers to adjusted combined ratio.
Diluted adjusted earnings per share is a non-GAAP financial measure defined as adjusted net income divided by the weighted-average common shares outstanding for the period, reflecting the dilution which could occur if equity-based awards are converted into common share equivalents as calculated using the treasury stock method. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of diluted earnings per share calculated in accordance with GAAP to diluted adjusted earnings per share.
Catastrophe loss ratio is a non-GAAP financial measure defined as the ratio of catastrophe losses to net earned premiums. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of loss ratio calculated using unadjusted GAAP numbers to catastrophe loss ratio.
Adjusted combined ratio excluding catastrophe losses is a non-GAAP financial measure defined as adjusted combined ratio excluding the impact of catastrophe losses. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of combined ratio calculated using unadjusted GAAP numbers to adjusted combined ratio excluding catastrophe losses.
Adjusted underwriting income is a non-GAAP financial measure defined as underwriting income excluding the impact of certain items that may not be indicative of underlying business trends, operating results, or future outlook. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of income before income taxes calculated in accordance with GAAP to adjusted underwriting income.
Tangible stockholders’ equity is a non-GAAP financial measure defined as stockholders’ equity less goodwill and intangible assets. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of stockholders’ equity calculated in accordance with GAAP to tangible stockholders’ equity.
Safe Harbor Statement
Palomar cautions you that statements contained in this press release may regard matters that are not historical facts but are forward-looking statements. These statements are based on the company’s current beliefs and expectations. The inclusion of forward-looking statements should not be regarded as a representation by Palomar that any of its plans will be achieved. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in the Company’s business. The forward-looking statements are typically, but not always, identified through use of the words "believe," "expect," "enable," "may," "will," "could," "intends," "estimate," "anticipate," "plan," "predict," "probable," "potential," "possible," "should," "continue," and other words of similar meaning. Actual results could differ materially from the expectations contained in forward-looking statements as a result of several factors, including unexpected expenditures and costs, unexpected results or delays in development and regulatory review, regulatory approval requirements, the frequency and severity of adverse events and competitive conditions. These and other factors that may result in differences are discussed in greater detail in the Company's filings with the Securities and Exchange Commission. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, which is made under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.Contact
Media Inquiries
Lindsay Conner
1-551-206-6217
lconner@plmr.comInvestor Relations
Jamie Lillis
1-203-428-3223
investors@plmr.com
Source: Palomar Holdings, Inc.Summary of Operating Results:
The following tables summarize the Company’s results for the three months ended March 31, 2024 and 2023:
Three Months Ended March 31, 2024 2023 Change % Change ($ in thousands, except per share data) Gross written premiums $ 368,078 $ 250,112 $ 117,966 47.2 % Ceded written premiums (228,171 ) (170,344 ) (57,827 ) 33.9 % Net written premiums 139,907 79,768 60,139 75.4 % Net earned premiums 107,866 83,241 24,625 29.6 % Commission and other income 528 695 (167 ) (24.0 )% Total underwriting revenue (1) 108,394 83,936 24,458 29.1 % Losses and loss adjustment expenses 26,837 20,652 6,185 29.9 % Acquisition expenses, net of ceding commissions and fronting fees 31,798 25,679 6,119 23.8 % Other underwriting expenses 24,804 19,222 5,582 29.0 % Underwriting income (1) 24,955 18,383 6,572 35.8 % Interest expense (740 ) (1,020 ) 280 (27.5 )% Net investment income 7,139 5,120 2,019 39.4 % Net realized and unrealized gains on investments 3,002 146 2,856 NM Income before income taxes 34,356 22,629 11,727 51.8 % Income tax expense 7,974 5,316 2,658 50.0 % Net income $ 26,382 $ 17,313 $ 9,069 52.4 % Adjustments: Net realized and unrealized gains on investments (3,002 ) (146 ) (2,856 ) NM Stock-based compensation expense 3,820 3,450 370 10.7 % Amortization of intangibles 390 313 77 24.6 % Expenses associated with catastrophe bond — 50 (50 ) (100.0 )% Tax impact 204 (540 ) 744 (137.8 )% Adjusted net income (1) $ 27,794 $ 20,440 $ 7,354 36.0 % Key Financial and Operating Metrics Annualized return on equity 21.7 % 17.5 % Annualized adjusted return on equity (1) 22.9 % 20.7 % Loss ratio 24.9 % 24.8 % Expense ratio 52.0 % 53.1 % Combined ratio 76.9 % 77.9 % Adjusted combined ratio (1) 73.0 % 73.3 % Diluted earnings per share $ 1.04 $ 0.68 Diluted adjusted earnings per share (1) $ 1.09 $ 0.80 Catastrophe losses $ 3,359 $ 1,806 Catastrophe loss ratio (1) 3.1 % 2.2 % Adjusted combined ratio excluding catastrophe losses (1) 69.8 % 71.2 % Adjusted underwriting income (1) $ 29,165 $ 22,196 $ 6,969 31.4 % NM - not meaningful (1)- Indicates Non-GAAP financial measure- see above for definition of Non-GAAP financial measures and see below for reconciliation of Non-GAAP financial measures to their most directly comparable measures prepared in accordance with GAAP.
Condensed Consolidated Balance sheets
Palomar Holdings, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (unaudited)
(in thousands, except shares and par value data)March 31, December 31, 2024 2023 (Unaudited) Assets Investments: Fixed maturity securities available for sale, at fair value (amortized cost: $697,505 in 2024; $675,130 in 2023) $ 662,992 $ 643,799 Equity securities, at fair value (cost: $32,785 in 2024; $43,003 in 2023) 37,171 43,160 Equity method investment 2,597 2,617 Other investments 1,871 — Total investments 704,631 689,576 Cash and cash equivalents 61,387 51,546 Restricted cash 377 306 Accrued investment income 5,192 5,282 Premiums receivable 322,723 261,972 Deferred policy acquisition costs, net of ceding commissions and fronting fees 66,508 60,990 Reinsurance recoverable on paid losses and loss adjustment expenses 28,542 32,172 Reinsurance recoverable on unpaid losses and loss adjustment expenses 292,024 244,622 Ceded unearned premiums 298,975 265,808 Prepaid expenses and other assets 82,679 72,941 Deferred tax assets, net 9,408 10,119 Property and equipment, net 312 373 Goodwill and intangible assets, net 11,926 12,315 Total assets $ 1,884,684 $ 1,708,022 Liabilities and stockholders' equity Liabilities: Accounts payable and other accrued liabilities $ 39,637 $ 42,376 Reserve for losses and loss adjustment expenses 402,187 342,275 Unearned premiums 662,307 597,103 Ceded premium payable 215,329 181,742 Funds held under reinsurance treaty 13,716 13,419 Income taxes payable 6,850 7,255 Borrowings from credit agreements 43,000 52,600 Total liabilities 1,383,026 1,236,770 Stockholders' equity: Preferred stock, $0.0001 par value, 5,000,000 shares authorized, 0 shares issued and outstanding as of March 31, 2024 and December 31, 2023 — — Common stock, $0.0001 par value, 500,000,000 shares authorized, 24,921,060 and 24,772,987 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively 3 3 Additional paid-in capital 357,135 350,597 Accumulated other comprehensive loss (26,505 ) (23,991 ) Retained earnings 171,025 144,643 Total stockholders' equity 501,658 471,252 Total liabilities and stockholders' equity $ 1,884,684 $ 1,708,022 Condensed Consolidated Income Statement
Palomar Holdings, Inc. and Subsidiaries
Condensed Consolidated Statements of Income and Comprehensive Income (loss) (Unaudited)
(in thousands, except shares and per share data)Three Months Ended March 31, 2024 2023 Revenues: Gross written premiums $ 368,078 $ 250,112 Ceded written premiums (228,171 ) (170,344 ) Net written premiums 139,907 79,768 Change in unearned premiums (32,041 ) 3,473 Net earned premiums 107,866 83,241 Net investment income 7,139 5,120 Net realized and unrealized gains on investments 3,002 146 Commission and other income 528 695 Total revenues 118,535 89,202 Expenses: Losses and loss adjustment expenses 26,837 20,652 Acquisition expenses, net of ceding commissions and fronting fees 31,798 25,679 Other underwriting expenses 24,804 19,222 Interest expense 740 1,020 Total expenses 84,179 66,573 Income before income taxes 34,356 22,629 Income tax expense 7,974 5,316 Net income $ 26,382 $ 17,313 Other comprehensive income, net: Net unrealized (losses) gains on securities available for sale (2,514 ) 5,474 Net comprehensive income $ 23,868 $ 22,787 Per Share Data: Basic earnings per share $ 1.06 $ 0.69 Diluted earnings per share $ 1.04 $ 0.68 Weighted-average common shares outstanding: Basic 24,862,367 24,969,703 Diluted 25,468,564 25,442,902 Underwriting Segment Data
The Company has a single reportable segment and offers specialty insurance products. Gross written premiums (GWP) by product, location and company are presented below:
Three Months Ended March 31, 2024 2023 ($ in thousands) % of % of % Amount GWP Amount GWP Change Change Product (1) Earthquake $ 105,729 28.7 % $ 93,495 37.4 % $ 12,234 13.1 % Fronting 94,831 25.8 % 91,755 36.7 % 3,076 3.4 % Inland Marine and Other Property 76,876 20.9 % 52,705 21.1 % 24,171 45.9 % Casualty 51,935 14.1 % 12,157 4.9 % 39,778 327.2 % Crop 38,707 10.5 % — — % 38,707 — % Total Gross Written Premiums $ 368,078 100.0 % $ 250,112 100.0 % $ 117,966 47.2 % (1) - Beginning in 2024, the Company has updated the categorization of its products to align with management's current strategy and view of the business. Prior year amounts have been reclassified for comparability purposes. The recategorization is for presentation purposes only and does not impact overall gross written premiums.
Three Months Ended March 31, 2024 2023 ($ in thousands) % of % of Amount GWP Amount GWP State California $ 157,217 42.7 % $ 131,889 52.7 % Texas 40,795 11.1 % 23,210 9.3 % Florida 13,924 3.8 % 12,096 4.8 % Hawaii 12,516 3.4 % 10,105 4.0 % Washington 12,002 3.3 % 11,972 4.8 % Colorado 9,605 2.6 % 1,848 0.7 % New York 8,030 2.2 % 3,871 1.5 % New Mexico 7,469 2.0 % 194 0.1 % Other 106,520 28.9 % 54,927 22.0 % Total Gross Written Premiums $ 368,078 100.0 % $ 250,112 100.0 % Three Months Ended March 31, 2024 2023 ($ in thousands) % of % of Amount GWP Amount GWP Subsidiary PSIC $ 222,657 60.5 % $ 150,704 60.3 % PESIC 136,493 37.1 % 99,408 39.7 % Laulima 8,928 2.4 % — — % Total Gross Written Premiums $ 368,078 100.0 % $ 250,112 100.0 % Gross and net earned premiums
The table below shows the amount of premiums the Company earned on a gross and net basis and the Company’s net earned premiums as a percentage of gross earned premiums for each period presented:
Three Months Ended March 31, 2024 2023 Change % Change ($ in thousands) Gross earned premiums $ 302,872 $ 225,243 $ 77,629 34.5 % Ceded earned premiums (195,006 ) (142,002 ) (53,004 ) 37.3 % Net earned premiums $ 107,866 $ 83,241 $ 24,625 29.6 % Net earned premium ratio 35.6 % 37.0 % Loss detail
Three Months Ended March 31, 2024 2023 Change % Change ($ in thousands) Catastrophe losses $ 3,359 $ 1,806 $ 1,553 86.0 % Non-catastrophe losses 23,478 18,846 4,632 24.6 % Total losses and loss adjustment expenses $ 26,837 $ 20,652 $ 6,185 29.9 % The following table represents a reconciliation of changes in the ending reserve balances for losses and loss adjustment expenses:
Three Months Ended March 31, 2024 2023 (in thousands) Reserve for losses and LAE net of reinsurance recoverables at beginning of period $ 97,653 $ 77,520 Add: Incurred losses and LAE, net of reinsurance, related to: Current year 26,333 17,300 Prior years 504 3,352 Total incurred 26,837 20,652 Deduct: Loss and LAE payments, net of reinsurance, related to: Current year 4,895 1,393 Prior years 9,432 15,413 Total payments 14,327 16,806 Reserve for losses and LAE net of reinsurance recoverables at end of period 110,163 81,366 Add: Reinsurance recoverables on unpaid losses and LAE at end of period 292,024 183,601 Reserve for losses and LAE gross of reinsurance recoverables on unpaid losses and LAE at end of period $ 402,187 $ 264,967 Reconciliation of Non-GAAP Financial Measures
For the three months ended March 31, 2024 and 2023, the Non-GAAP financial measures discussed above reconcile to their most comparable GAAP measures as follows:
Underwriting revenue
Three Months Ended March 31, 2024 2023 (in thousands) Total revenue $ 118,535 $ 89,202 Net investment income (7,139 ) (5,120 ) Net realized and unrealized gains on investments (3,002 ) (146 ) Underwriting revenue $ 108,394 $ 83,936 Underwriting income and adjusted underwriting income
Three Months Ended March 31, 2024 2023 (in thousands) Income before income taxes $ 34,356 $ 22,629 Net investment income (7,139 ) (5,120 ) Net realized and unrealized gains on investments (3,002 ) (146 ) Interest expense 740 1,020 Underwriting income $ 24,955 $ 18,383 Stock-based compensation expense 3,820 3,450 Amortization of intangibles 390 313 Expenses associated with catastrophe bond — 50 Adjusted underwriting income $ 29,165 $ 22,196 Adjusted net income
Three Months Ended March 31, 2024 2023 (in thousands) Net income $ 26,382 $ 17,313 Adjustments: Net realized and unrealized gains on investments (3,002 ) (146 ) Stock-based compensation expense 3,820 3,450 Amortization of intangibles 390 313 Expenses associated with catastrophe bond — 50 Tax impact 204 (540 ) Adjusted net income $ 27,794 $ 20,440 Annualized adjusted return on equity
Three Months Ended March 31, 2024 2023 (in thousands) Annualized adjusted net income $ 111,176 $ 81,761 Average stockholders' equity $ 486,455 $ 394,701 Annualized adjusted return on equity 22.9 % 20.7 % Adjusted combined ratio
Three Months Ended March 31, 2024 2023 (in thousands) Numerator: Sum of losses and loss adjustment expenses, acquisition expenses, and other underwriting expenses, net of commission and other income $ 82,911 $ 64,858 Denominator: Net earned premiums $ 107,866 $ 83,241 Combined ratio 76.9 % 77.9 % Adjustments to numerator: Stock-based compensation expense (3,820 ) (3,450 ) Amortization of intangibles (390 ) (313 ) Expenses associated with catastrophe bond — (50 ) Adjusted combined ratio 73.0 % 73.3 % Diluted adjusted earnings per share
Three Months Ended March 31, 2024 2023 (in thousands, except per share data) Adjusted net income $ 27,794 $ 20,440 Weighted-average common shares outstanding, diluted 25,468,564 25,442,902 Diluted adjusted earnings per share $ 1.09 $ 0.80 Catastrophe loss ratio
Three Months Ended March 31, 2024 2023 (in thousands) Numerator: Losses and loss adjustment expenses $ 26,837 $ 20,652 Denominator: Net earned premiums $ 107,866 $ 83,241 Loss ratio 24.9 % 24.8 % Numerator: Catastrophe losses $ 3,359 $ 1,806 Denominator: Net earned premiums $ 107,866 $ 83,241 Catastrophe loss ratio 3.1 % 2.2 % Adjusted combined ratio excluding catastrophe losses
Three Months Ended March 31, 2024 2023 (in thousands) Numerator: Sum of losses and loss adjustment expenses, acquisition expenses, and other underwriting expenses, net of commission and other income $ 82,911 $ 64,858 Denominator: Net earned premiums $ 107,866 $ 83,241 Combined ratio 76.9 % 77.9 % Adjustments to numerator: Stock-based compensation expense (3,820 ) (3,450 ) Amortization of intangibles (390 ) (313 ) Expenses associated with catastrophe bond — (50 ) Catastrophe losses (3,359 ) (1,806 ) Adjusted combined ratio excluding catastrophe losses 69.8 % 71.2 % Tangible Stockholders’ equity
March 31, December 31, 2024 2023 (in thousands) Stockholders' equity $ 501,658 $ 471,252 Goodwill and intangible assets (11,926 ) (12,315 ) Tangible stockholders' equity $ 489,732 $ 458,937 
