Ambac(AMBC)2025-02-27 21:02Financial Data and Key Metrics Changes - Ambac reported a consolidated net loss of 10.23 per diluted share for Q4 2024, compared to a net loss of 0.24 per diluted share in Q4 2023 [28] - The consolidated adjusted net loss was 0.12 per diluted share for Q4 2024, compared to adjusted net income of 0.10 per diluted share in Q4 2023 [30] - The company recorded a 570 million loss on the sale of its legacy financial guarantee business, now reported as discontinued operations [23] Business Line Data and Key Metrics Changes - The P&C business generated nearly 900 million in premiums, up 74% from 2023, and produced 100 million in revenue for 2024, up 93%, and earned approximately 380 million, up 40% from the prior year, with a combined ratio of 101.6%, improving nearly 500 basis points over 2023 [20][39] Market Data and Key Metrics Changes - The overall E&S market continues to perform well, with high-single to double-digit rate increases in U.S. casualty lines [12] - The property market showed some softening in Q4 2024, but terms and conditions have held [13] - Professional and financial lines are experiencing softness, particularly in large account and public market D&O [14] Company Strategy and Development Direction - The company is focused on the future growth of its Specialty P&C business and delivering value for shareholders [11] - Ambac aims to achieve strong organic growth and generate 90 million of adjusted EBITDA to common shareholders by 2028 [44] - The acquisition of Beat is expected to deliver strong organic growth and enhance the distribution platform [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about stabilization in the Employer Stop Loss and short-term medical segments, despite current challenges [50][51] - The focus remains on profitability for Everspan, with effective loss ratios in the mid-60s aligning with long-term goals [55] - Management is excited about the prospects of Ambac's future and the unique value proposition it offers in the specialty MGA space [43] Other Important Information - The company has committed third-party capacity of more than $1.5 billion for 2025, with over 60% of that support being long-term [19] - The adjusted EBITDA margin for 2024 was 20%, with expectations for meaningful advancements in the future [15][16] Q&A Session Summary Question: Distribution business performance and outlook - Management noted softening in Employer Stop Loss and short-term medical segments, with expectations for stabilization in the near future [50][51] Question: Sustainability of Everspan's combined ratio - Management indicated that while there are variabilities, the performance aligns with long-term objectives, aiming for effective loss ratios in the mid-60s [55]