RenaissanceRe (RNR) Misses Q3 EPS by $2.73, Revenues Beat

RenaissanceRe (NYSE: RNR) reported Q3 EPS of ($2.64), $2.73 worse than the analyst estimate of $0.09. Revenue for the quarter came in at $1.33 billion versus the consensus estimate of $1.27 billion.

Third Quarter of 2020 Summary

• Net negative impact on net income available to RenaissanceRe common shareholders of $321.7 million resulting from Hurricane Laura, Hurricane Sally, the wildfires occurring in California, Oregon and Washington (the “Q3 2020 Wildfires”), other catastrophe events including the August 2020 derecho which impacted the U.S. Midwest, Hurricane Isaias, and Typhoon Maysak (the “Other Q3 2020 Catastrophe Events”), and loss estimates associated with aggregate loss contracts on these and other events in the third quarter of 2020 (collectively, the “Q3 2020 Large Loss Events”).
• Gross premiums written increased by $282.0 million, or 32.7%, to $1.1 billion, in the third quarter of 2020 compared to the third quarter of 2019, driven by an increase of $168.6 million in the Casualty and Specialty segment and an increase of $113.4 million in the Property segment.
• Underwriting loss of $206.1 million and a combined ratio of 120.6% in the third quarter of 2020, compared to an underwriting loss of $3.4 million and a combined ratio of 100.4% in the third quarter of 2019. The Property segment incurred an underwriting loss of $206.6 million and had a combined ratio of 140.0% in the third quarter of 2020. The Casualty and Specialty segment generated underwriting income of $0.6 million and had a combined ratio of 99.9% in the third quarter of 2020. The Company’s underwriting result in the third quarter of 2020 was principally impacted by the Q3 2020 Large Loss Events, which resulted in a net negative impact on the underwriting result of $422.4 million and added 43.4 percentage points to the combined ratio, primarily in the Property segment. The third quarter of 2019 included the impacts of Hurricane Dorian and Typhoon Faxai (collectively, the “Q3 2019 Catastrophe Events”), which resulted in an underwriting loss of $181.9 million and added 20.6 percentage points to the combined ratio.
• Total investment result was $307.8 million in the third quarter of 2020, generating an annualized total investment return of 6.2%, compared to $145.8 million and an annualized total investment return of 3.6% in the third quarter of 2019.

Kevin J. O’Donnell, President and Chief Executive Officer of RenaissanceRe, commented: “Another active quarter further confirms the critical role RenaissanceRe plays in helping communities rebuild. Our results for the third quarter reflect the climate-change driven frequency of catastrophic events impacting the world, but these are risks that we understand well and are paid to take. As we approach the January renewal, I am confident we will successfully execute our strategy and profitably deploy significant capital by helping our customers solve their biggest problems.”

For earnings history and earnings-related data on RenaissanceRe (RNR) click here.

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