ID: Universal Insurance Holdings, Inc. (NYSE:UVE) Q4 2022 Earnings Conference Call February 24, 2023 9:30 AM ET

Company Participants

Arash Soleimani - Chief Strategy Officer, CFA, CPA

Steve Donaghy - CEO & Director

Frank Wilcox - Chief Financial Officer

Conference Call Participants

Paul Newsome - Piper Sandler

Nick Iacoviello - Dowling & Partners

Operator

Good morning, ladies and gentlemen. And welcome to Universal’s Fourth Quarter 2022 Earnings Conference Call. As a reminder, this conference call is being recorded. I would now like to turn the conference over to Arash Soleimani, Chief Strategy Officer.

Arash Soleimani

Good morning. Thank you for joining us today. Welcome to our quarterly earnings call. On the call with me today are Steve Donaghy, Chief Executive Officer; and Frank Wilcox, Chief Financial Officer.

Before we begin, please note today’s discussion may contain forward-looking statements and non-I financial measures. Forward-looking statements involve assumptions, risks and uncertainties that could cause actual results to differ materially from those statements.

For more information, please see the press release and Universal’s SEC filings, all of which are available on the Investors section of our website at universalinsuranceholdings.com and on the SEC’s website. A reconciliation of non-I financial measures to comparable I measures is included in the quarterly press release and can also be found on Universal’s website at universalinsuranceholdings.com.

With that, I’ll turn the call over to Steve.

Steve Donaghy

Thanks Arash. Good morning, everyone. It was a tough year, but I'm proud of what our team accomplished despite the circumstances. The Florida homeowners insurance market has faced significant challenges, but we remain committed to our home state and continue to write new and renewal business. We are grateful to state officials for passing meaningful reforms at the recent special legislative session, including elimination of one way attorney fees and assignment of benefits, shortening the claims filing deadline to one year, and taking steps to reduce the competitiveness of citizens, among other measures.

It will take time for the reforms to benefit results, but we believe the legislature's actions will restore the health of the market over the long term. Given our differentiated business model, solid balance sheet and strong reinsurer relationships, we're uniquely positioned to succeed in the dynamic Florida landscape.

I'll turn it over to Frank to walk through our financial results. Frank?

Frank Wilcox

Thank you, Steve. Adjusted diluted earnings per common share was $0.72, up from diluted adjusted loss per common share of a $1.53 in the prior year quarter, with the increase mostly attributable to lower net loss in expense ratios and higher net investment income and commission revenue. Core revenue of $326.4 million was up 11.3% year-over-year, with growth primarily stemming from higher net premiums earned, net investment income and commission revenue. Direct premiums written of $416.1 million were up 4.2% from the prior year quarter, including 3.6% growth in Florida and 6.8% growth in other states.