Palomar Holdings Inc. (NASDAQ: PLMR) reported Q2 EPS of $0.52, $0.03 better than the analyst estimate of $0.49. Revenue for the quarter came in at $83.81 million versus the consensus estimate of $75.05 million.

Second Quarter 2020 Highlights

• Gross written premiums increased by 43.6% to $83.8 million compared to $58.3 million in the second quarter of 2019
• Net income increased by 79.3% to $12.0 million, or $0.48 per diluted share, compared to a net income of $6.7 million, or $0.30 per diluted share, in the second quarter of 2019
• Adjusted net income(1) increased by 63.0% to $13.0 million, or $0.52 per diluted share, compared to $8.0 million, or $0.36 per diluted share, in the second quarter of 2019
• Total loss ratio of 10.1% compared to 2.8% in the second quarter of 2019
• Combined ratio of 68.4% compared to 69.2% in the second quarter of 2019
• Adjusted combined ratio(1) of 65.1%, compared to 63.8% in the second quarter of 2019
• Annualized return on equity of 15.1%, compared to 17.8% in the second quarter of 2019
• Annualized adjusted return on equity(1) of 16.4%, compared to 21.2% in the second quarter of 2019

Mac Armstrong, Chairman and Chief Executive Officer, commented, “The second quarter found Palomar continuing to operate capably in a difficult environment. While the COVID -19 pandemic and civil unrest challenged our nation, we navigated and will continue to navigate through these uncharted waters by focusing on Palomar’s founding principles, which compel us to help build and restore challenged and damaged areas of our country. That mantra along with our Company’s values and culture will allow us to ably face today’s challenges and moreover make a meaningful and lasting impact. A hallmark of our success has been our ability to not only embrace change but also to anticipate it. This mentality is ingrained in our people and our operations and it will ensure that we remain focused on delivering innovative products that meet the needs of our customers.”

Mr. Armstrong continued, “Our ability to execute in this tumultuous environment is seen in our second quarter 2020 results. We delivered year-over-year gross written premium growth of 43.6% and year-over-year adjusted net income growth of 63.0%. We also successfully completed our June 1st reinsurance placement procuring an incremental $200 million of limit to support future growth. Lastly, we announced the formation of Palomar Excess and Surplus Insurance Company (“Palomar E&S”), our newly established surplus lines insurance company. Palomar E&S presents a natural and exciting progression in our Company’s evolution as we extend our specialty property franchise to the surplus lines insurance market. We capitalized Palomar E&S with approximately $100 million in surplus including proceeds from a primary share issuance in June. We expect to begin writing business during the third quarter.”

Full Year 2020 Outlook

• For the full year 2020, the Company affirms prior guidance of adjusted net income of $50.5 to $53.0 million, equating to a growth rate of 33% to 40% compared to the full year 2019.

For earnings history and earnings-related data on Palomar Holdings Inc. (PLMR) click here.