Everest Group, Ltd.

Welcome to the Everest Group LTD third quarter 2023 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Mr. Matthew Rohrman, Senior Vice President, Head of Investor Relations. Please go ahead.

Good morning, everyone, and welcome to the Everest Group Limited third quarter of 2023 earnings conference call. The Everest executives leading today's call are Juan Andrade, President and CEO, and Mark Kosciancic, Executive Vice President and CFO. We're also joined by other members of the Everest management team. Before we begin, I'll preface the comments in today's call by noting that Everest SEC filings, including extensive disclosures with respect to forward-looking statements, management comments regarding estimates, projections, and similar are subject to the risks, uncertainties, and assumptions as noted in these filings. Management may also refer to certain non-GAAP financial measures. These items are reconciled in our earnings release and financial supplement. With that, I'll turn the call over to Juan. Thank you, Matt. Good morning, everyone.

Thank you for joining us. Favre's third quarter performance was excellent. We delivered outstanding returns, including a near 20% operating return on equity and an annualized total shareholder return of 25%. We are leaning into the hard reinsurance market, where favorable conditions and a flight to quality persist. As the lead reinsurance market and preferred partner, we are taking advantage of strong pricing, while deepening our client relationships and expanding our global portfolio at significantly improved risk-adjusted returns. We are positioned for success as we head into the January renewals. We also remain on track for January 2024 for the full deployment of the equity capital raised in May. Our primary insurance business delivered strong underwriting income with a significant year-over-year improvement in the third quarter. And our high-quality investment portfolio continues to support our underwriting performance with outstanding returns. We achieved these results despite another active catastrophe quarter. We tracked over 80 material events globally this quarter, resulting in a nine-month year-to-date industry loss estimated at roughly $93 billion. The industry is on course for another $100 billion loss this year. This reinforces the need for continued underwriting discipline and for additional pricing increases across all lines. As the world becomes increasingly complex, Everest's value proposition fits in greater demand. As you have heard me say before, we are on offense with strong tailwinds across all of our earning streams, a strong balance sheet, and top tier global talent powering it all. With that, I'll turn to our third quarter financial highlights, beginning at the group level. In addition to delivering exceptional returns, we drove substantial improvements across our group key financial metrics, underwriting income, net investment income, operating income, and net income. And we delivered record increases in operating cash flow and book value per share. We grew the business at significantly expanded margins. Rose-written premiums increased by 23% year-over-year in constant dollars, led by record quarterly reinsurance growth. We generated $613 million in net operating income, a significant year-over-year increase, and we have generated $1.7 billion year-to-date. The group combined ratio of 91.4% also improved year-over-year by 21 points, which translates to an underwriting profit of over $300 million for the quarter and nearly $1 billion in underwriting profit year-to-date. Our attritional loss and combined ratios both improved by more than a point year-over-year to 59% and 86.5% respectively. We generated more than $400 million in net investment income. in the third quarter, and we delivered over $1 billion of net investment income year-to-date. In addition to the improved interest rate environment, this year-over-year improvement was driven by strong returns from both our fixed income and our alternative investments. Turning now to our reinsurance business, the Reinsurance Division delivered an exceptional quarter with outstanding top and bottom line results and superb execution by our team. Leading into the strength of the market, we maintained our strategy of targeted and nimble capital deployment with core clients, resulting in significant growth across virtually all business lines and geographies as materially improved risk-adjusted returns. We grew gross written premiums on a constant dollar basis and excluding reinstatements by 33% to $3.2 billion for the quarter. This is a new record for the division. In property catastrophe, where the market remains outstanding, premiums excluding reinstatements were up 41% from last year. Property pro rata premiums increased 44%. Casualty pro rata premiums were up as well, at 20%, while we carefully managed the casualty market cycle and target best-in-class clients. Internationally, we expanded in key target growth markets across Europe, Asia, and Latin America. We also grew in specialty lines with strong margins, including aviation, marine, and mortgage. Despite the active catastrophe quarter, we improved our catastrophe loss ratio significantly year over year, reflecting our deliberate and consistent actions to manage volatility. The attritional loss and combined ratios were down year over year by 1.6 and almost two points, respectively, with the overall combined ratio improving to 91%. This helped us achieve an underwriting profit of $234 million. Looking ahead, our outlook for the January 1, 2024 renewal remains strong. We fully expect the robust pricing and favorable conditions to continue. And as a lead market, we stand to benefit. Our nimble, creative, and collaborative approach allows us to simultaneously improve our economics and strengthen client relationships. This tremendous relationship equity will serve us well. Expectations for pricing and terms and conditions in the global property market are now well understood. which should make future renewals more orderly. At recent industry events, including Monte Carlo and CIAB, our clients told us that they want more of our capacity and want to further broaden their partnership with us. Our confidence in our strategy and in the strength and durability of the market is high. I am excited by the magnitude of the opportunity we have created for the business. We are extremely well-positioned with the expertise global capabilities, and financial strength to seize this generational market opportunity and to optimize the portfolio for the long term. Now turning to our insurance division. In our primary business, rate continues to exceed loss trend with improvements across multiple lines. We achieved an 11% increase in our core portfolio, excluding workers' compensation and financial lines. In addition to property, improved pricing was particularly strong in marine and other specialty lines. We grew the business approximately 4% and generated more than $1 billion in gross written premiums. Growth in the quarter was diversified and particularly strong across property where we see excellent opportunities. And specialty lines such as marine, aviation, trade credit, and political risk. The growth was offset by reductions in workers' compensation and financial lines where the market is less attractive. Additionally, we are gaining traction internationally where we are methodically scaling our capabilities and our platform. Our focus remains on driving bottom line growth. We continue our discipline underwriting to take advantage of high margin opportunities and reduce exposure in pockets of business that do not meet our profitability objectives. The attritional loss ratio improved year-over-year to 63%. Our pre-tax catastrophe losses at $10 million, net of estimated recoveries and reinstatement premiums, were modest, leading to an improvement in the reported combined ratio to 92.6%. We achieved an underwriting profit of $66 million in the quarter and a record profit of $196 million year-to-date. We continue to attract and develop best-in-class talent. We share our vision for the company and our commitment to world-class customer service. I am bullish about the momentum we have created for our business and Everest position in the market. We have every advantage at our disposal, a world-class team, strong and diversified reinsurance and insurance platforms, and market tailwinds at our back. to accelerate our progress and build even greater value for our shareholders. With that, I'll turn it over to Mark to review the financials in more detail.