Essent Group Ltd. (NYSE:ESNT) Q1 2022 Earnings Conference Call May 6, 2022 10:00 AM ET

Company Participants

Mark Casale - Chairman and Chief Executive Officer

Larry McAlee - Chief Financial Officer

Chris Curran - President, Essent Guaranty

Phil Stefano - Investor Relations

Conference Call Participants

Mark DeVries - Barclays

Rick Shane - JPMorgan

Bose George - KBW

Mihir Bhatia - Bank of America

Doug Harter - Credit Suisse

Ryan Gilbert - BTIG

Operator

Ladies and gentlemen, thank you for standing by. My name is Brent and I will be your conference operator today. At this time, I would like to welcome everyone to the Essent Group Ltd. First Quarter 2022 Earnings Call. [Operator Instructions] Thank you. It’s now my pleasure to turn today’s call over to Mr. Phil Stefano, Vice President of Investor Relations. Please go ahead.

Phil Stefano

Thank you, Brent. Good morning, everyone and welcome to our call. Joining me today are Mark Casale, Chairman and CEO and Larry McAlee, Chief Financial Officer. Also on hand for the Q&A portion of the call is Chris Curran, President of Essent Guaranty. Our press release, which contains Essent’s financial results for the first quarter of 2022 was issued earlier today and is available on our website at essentgroup.com.

Prior to getting started, I’d like to remind participants that today’s discussions are being recorded and will include the use of forward-looking statements. These statements are based on current expectations, estimates, projections and assumptions that are subject to risks and uncertainties, which may cause actual results to differ materially. For a discussion of these risks and uncertainties, please review the cautionary language regarding forward-looking statements in today’s press release, the risk factors included in our Form 10-K filed with the SEC on February 16, 2022 and any other reports and registration statements filed with the SEC which are also available on our website.

Now, let me turn the call over to Mark.

Mark Casale

Thanks, Phil and good morning everyone. Today, we released our quarterly financial results, which continued to reflect the favorable credit performance of our portfolio.

For the first quarter of 2022, we reported net income of $274 million as compared to $136 million a year ago. Our first quarter results benefited primarily from the release of approximately $100 million of our COVID reserves associated with defaults from the second and third quarters of 2020. On a diluted per share basis, we earned $2.52 for the first quarter compared to $1.21 a year ago and our annualized return on average equity was 26%.