Kingstone Reports Record Fourth Quarter and Full Year 2024 Results

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Insights

Kingstone's Q4 and full year 2024 results represent exceptional performance in the property and casualty insurance sector. The 31% core direct premium written (DPW) growth for the full year - accelerating to 49% in Q4 - is remarkable in an industry where high single-digit growth is typically considered strong. More importantly, this growth wasn't achieved by sacrificing underwriting discipline.

The combined ratio of 80% for the full year (improving by 25.3 percentage points) demonstrates outstanding profitability. For context, most P&C insurers target combined ratios below 95%, with anything in the low 80s considered excellent. The Q4 combined ratio of 78.5% shows continued momentum rather than a one-time improvement.

This performance stems from multiple sources: lower claims frequency/severity, minimal catastrophe losses, and operational efficiency improvements. The expense ratio reduction to 31.3% despite paying performance bonuses indicates structural improvements in the business model.

What makes these results particularly impressive is achieving this profitable growth during a period of market dislocation. The company appears to be capitalizing on competitor withdrawals or price increases in their markets while maintaining underwriting discipline. The raised 2025 guidance suggests management confidence in the sustainability of these favorable conditions.

03/13/2025 - 04:15 PM

Core DPW Growth of 31% andCombined Ratio of 80% for Full Year 2024; Raises 2025 Guidance

KINGSTON, NY / ACCESS Newswire / March 13, 2025 / Kingstone Companies, Inc. (Nasdaq:KINS) (the "Company" or "Kingstone"), a Northeast regional property and casualty insurance holding company, today announced its financial results for the fourth quarter and full year ended December 31, 2024. The Company will hold its fourth quarter and full year 2024 financial results conference call on Friday, March 14, 2025, at 8:30 a.m. Eastern Time. With this release, the Company has provided an investor presentation that can be accessed through the Investor Relations/Events & Presentations section of the Company website (www.kingstonecompanies.com).

	Key Financial and Operational Highlights
		Quarters Ended									Years Ended
($ in thousands, except per share data)		December 31,									December 31,
		2024			2023			Change			2024			2023			Change
Direct premiums written¹ - Core Business²		$	70,164		$	47,027			49.2	%	$	232,227		$	176,692			31.4	%
Net combined ratio			78.5	%		89.5	%	(11.0) pts				80.0	%		105.3	%	(25.3) pts
Net Income/(Loss)		$	5,439		$	2,946			84.6	%	$	18,358		$	(6,168	)	NM
Net Income/(Loss) per share - basic		$	0.44		$	0.27			63.0	%	$	1.60		$	(0.57	)	NM
Net Income/(Loss) per share - diluted		$	0.40		$	0.26			53.8	%	$	1.48		$	(0.57	)	NM
Return on equity - annualized			34.4	%		38.6	%	(4.2) pts				36.3	%		(17.5	)%	53.8 pts

Management Commentary

Meryl Golden, President and Chief Executive Officer of Kingstone, stated, "We ended the year with outstanding profitability and unprecedented growth in both the fourth quarter and full year 2024.

"Core business direct premiums written grew by 49% in the final three months due to market dislocation, leading to record annual growth of 31% for the full year. We remain committed to profitable growth by adhering to disciplined underwriting while delivering exceptional service to our producers and policyholders.

Ms. Golden continued, "From a profitability standpoint, we achieved our fifth consecutive quarter of profitability during the fourth quarter of 2024, with a combined ratio of 78.5%, an 11-percentage point improvement from the same period last year. While we experienced a moderate increase in large losses, as expected during the holiday season, our improvement was driven by lower frequency overall, no catastrophe losses, and a lower expense ratio.

"For the full year, our combined ratio improved remarkably by 25.3-percentage points to 80.0%. The loss ratio improvement was driven by lower frequency and severity, along with minimal impact from severe weather and catastrophe events. Even with bonuses to employees and profit sharing to producers due to our record profitability, we were able to lower our expense ratio by another 1.6 points to 31.3%."

Ms. Golden concluded, "Our continued success is rooted in disciplined execution, a commitment to operational excellence, and a deep understanding of market dynamics. 2024 was a pivotal year for Kingstone, with improvement in every dimension of our business, a testament to the commitment and tireless efforts of our dedicated teams.

We take great pride in the successful execution of our strategy and with favorable market conditions persisting, we are well-positioned to continue to capitalize on key opportunities. As we look ahead, we are committed to sustainable long-term profitability and value creation for our shareholders."

Guidance (see "Disclaimer and Forward-Looking Statements" below)

For 2025, the Company's full year expectations are calculated based on anticipated net premiums earned of approximately $184 million, and are as follows:

Guidance Metrics	2025 - Current	2025 - Previous
Core Business² direct premiums written growth	15% to 25%	15% to 25%
Combined ratio	81% to 85%	82% to 86%
Net income per share - basic	$1.90 to $2.30	$1.60 to $2.00
Net income per share - diluted	$1.75 to $2.15	$1.45 to $1.85
Return on equity	27% to 35%	24% to 32%

The following reflects the impact of dilution to total shares outstanding for the year ended December 31, 2024 and full year 2025 guidance:

Common Stock Metrics	Year Ended		2025E
(shares in millions)	December 31, 2024
Weighted average shares outstanding - basic		11.5	13.3
Weighted average shares outstanding - diluted		12.4	14.2
Total shares outstanding as of end of period - basic		12.9	13.6
Total shares outstanding as of end of period - diluted		14.1	14.7
All changes to total shares outstanding - basic and diluted assumed for 2025 are primarily from the vesting of restricted shares and stock issued under our "at the market" offering.

Consolidated Financial Results

Consolidated Financial Results	Quarters Ended									Years Ended
($ in thousands, except per share data)	December 31,									December 31,
	2024			2023			Change			2024			2023			Change
Direct premiums written¹	$	72,533		$	52,938			37.0	%	$	241,980		$	200,175			20.9	%
Net premiums earned	$	35,967		$	28,683			25.4	%	$	128,498		$	114,384			12.3	%

Net investment income	$	1,906		$	1,571			21.3	%	$	6,824		$	6,009			13.6	%
Net (loss)/gain on investments	$	(905	)	$	1,537		NM			$	415		$	2,135			(80.6	)%

Underlying loss ratio¹		49.1	%		53.8	%	(4.7) pts				48.2	%		65.3	%	(17.1) pts
Net development of prior year losses		(0.4	)%		0.0	%	(0.4) pts				(1.4	)%		0.0	%	(1.4) pts
Net loss ratio excluding the effect of catastrophes¹		48.7	%		53.8	%	(5.1) pts				46.8	%		65.3	%	(18.5) pts
Catastrophe loss ratio¹		0.0	%		3.0	%	(3.0) pts				1.9	%		7.1	%	(5.2) pts
Net loss ratio		48.7	%		56.8	%	(8.1) pts				48.7	%		72.4	%	(23.7) pts
Net underwriting expense ratio		29.8	%		32.7	%	(2.9) pts				31.3	%		32.9	%	(1.6) pts
Net combined ratio		78.5	%		89.5	%	(11.0) pts				80.0	%		105.3	%	(25.3) pts

Adjusted EBITDA¹	$	9,303		$	4,201			121.4	%	$	30,516		$	(1,692	)	NM
Net Income/(Loss)	$	5,439		$	2,946			84.6	%	$	18,358		$	(6,168	)	NM
Net Income/(Loss) per share - basic	$	0.44		$	0.27			63.0	%	$	1.60		$	(0.57	)	NM
Net Income/(Loss) per share - diluted	$	0.40		$	0.26			53.8	%	$	1.48		$	(0.57	)	NM
Return on equity - annualized		34.4	%		38.8	%	(4.4) pts				36.3	%		(17.5	)%	NM

Other comprehensive (loss)/income	$	(3,135	)	$	4,845		NM			$	99		$	3,684			(97.3	)%
Operating net income/(loss)¹	$	6,153		$	1,732			255.3	%	$	18,031		$	(7,855	)	NM
Operating net income/(loss) per share - basic¹	$	0.49		$	0.16			206.3	%	$	1.57		$	(0.73	)	NM
Operating net income/(loss) per share - diluted¹	$	0.46		$	0.15			206.7	%	$	1.45		$	(0.73	)	NM
Operating return on equity¹		9.7	%		5.7	%	4.0 pts				35.6	%		(22.2	)%	NM
Operating return on equity¹ - annualized		38.9	%		22.7	%	16.2 pts				35.6	%		(22.2	)%	NM

Book value per share - diluted										$	4.73		$	2.81			68.3	%
Book value per share - diluted excluding AOCI										$	5.59		$	3.80			47.1	%

NM = Not Meaningful

Core Business Results (New York Only)
The Company refers to its New York policies as its Core Business.

Core Business Results (New York Only)	Quarters Ended								Years Ended
($ in thousands, except per share data)	December 31,								December 31,
	2024			2023			Change		2024			2023			Change
Direct premiums written^{1, 3}	$	70,164		$	47,027		49.2	%	$	232,227		$	176,692		31.4	%
Net premiums earned	$	34,700		$	25,740		34.8	%	$	121,168		$	99,346		22.0	%
Net loss ratio excluding the effect of catastrophes^1,3		48.4	%		52.8	%	(4.4) pts			45.8	%		61.4	%	(15.6)pts
Catastrophe loss ratio^{1, 3}		0.0	%		1.6	%	(1.6) pts			1.3	%		4.4	%	(3.1)pts
Net loss ratio³		48.4	%		54.4	%	(6.0) pts			47.1	%		65.8	%	(18.7)pts

Non-Core Business Results (Outside of New York)
The Company has been aggressively reducing policy count in the Non-Core Business, subject to regulatory requirements.

Non-Core Business Results (Outside of New York)	Quarters Ended									Years Ended
($ in thousands, except per share data)	December 31,									December 31,
	2024			2023			Change			2024			2023			Change
Direct premiums written^{1, 3}	$	2,370		$	5,911			(59.9	)%	$	9,754		$	23,482			(58.5	)%
Net premiums earned	$	1,268		$	2,943			(56.9	)%	$	7,330		$	15,038			(51.3	)%
Net loss ratio excluding the effect of catastrophes^1,3		56.0	%		62.4	%	(6.4) pts				64.1	%		91.4	%	(27.3) pts
Catastrophe loss ratio^{1, 3}		0.0	%		15.7	%	(15.7) pts				11.5	%		24.9	%	(13.4) pts
Net loss ratio³		56.0	%		78.2	%	(22.2) pts				75.5	%		116.3	%	(40.8) pts

Premium and Policy Trends

Premium and Policy Trends	Quarter Ended
($ in thousands)	December 31, 2024		Sequential Change			September 30, 2024		Sequential Change			June 30, 2024		Sequential Change			March 31, 2024		Sequential Change			December 31, 2023
Core Business²
Direct premiums written^{1, 3}	$	70,164		9.3	%	$	64,170		25.1	%	$	51,306		10.1	%	$	46,587		(0.9)	%	$	47,027
Policies in force		73,857		6.5	%		69,347		3.6	%		66,934		(0.1)	%		66,991		(0.9)	%		67,575
Non-Core Business²
Direct premiums written^1,3	$	2,370		(3.5)	%	$	2,457		12.2	%	$	2,190		(20.0)	%	$	2,738		(53.7)	%	$	5,911
Policies in force		3,799		(31.4)	%		5,540		(24.2)	%		7,306		(19.5)	%		9,080		(16.1)	%		10,823

¹These measures are not based on GAAP and are defined and reconciled below to the most directly comparable GAAP measures. See "Definitions and Non-GAAP Measures".

²Kingstone refers to New York business as its "Core" business and business outside of New York as its "Non-Core" business.

³Core and Non-Core business direct premiums written, net loss ratio excluding the effect of catastrophes and catastrophe loss ratio are not based on GAAP. Net premiums earned is the most directly comparable GAAP measure to direct premiums written. Net loss ratio is the most directly comparable GAAP measure to net loss ratio excluding the effect of catastrophes and catastrophe loss ratio. The aggregate of Core Business and Non-Core Business direct premiums written, net loss ratios and catastrophe loss ratios is represented by direct premiums written, net loss ratios and catastrophe loss ratio, as set forth under Consolidated Financial Results above. See "Definitions and Non-GAAP Measures".

Conference Call Details
Friday, March 14, 2025, at 8:30 a.m. Eastern Time

To participate please dial:
U.S. toll free 1-877-423-9820
International 1-201-493-6749

Participants are asked to dial-in approximately 10 minutes before the conference call is scheduled to begin. The conference call can also be accessed via webcast in the "Investor Relations/Events & Presentations" tab of the Company's website or by clicking here. The webcast will be archived and accessible for approximately 30 days.

About Kingstone Companies, Inc.

Kingstone is a northeast regional property and casualty insurance holding company whose principal operating subsidiary is Kingstone Insurance Company ("KICO"). KICO is a New York domiciled carrier writing business through retail and wholesale agents and brokers. KICO is actively writing personal lines and commercial auto insurance in New York, and in 2024 was the 12th largest writer of homeowners insurance in New York. KICO is also licensed in New Jersey, Rhode Island, Massachusetts, Connecticut, Pennsylvania, New Hampshire, and Maine.

Investor Relations Contact:
Karin Daly
Vice President
The Equity Group Inc.
kdaly@equityny.com

Disclaimer and Forward-Looking Statements

The guidance provided above is based on information available as of March 13, 2025 and management's review of the anticipated financial results for 2025. Such guidance remains subject to change based on management's ongoing review of the Company's 2025 results and is a forward-looking statement (see below). Kingstone assumes no obligation to update this guidance. The actual results may be materially different and are affected by the risk factors and uncertainties identified in this press release and in Kingstone's annual and quarterly filings with the Securities and Exchange Commission.

This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. These statements are based on management's current expectations and are subject to uncertainty and changes in circumstances. These statements involve risks and uncertainties that could cause actual results to differ materially from those included in forward-looking statements due to a variety of factors. For more details on factors that could affect expectations, see Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2023.

The risks and uncertainties include, without limitation, the following:

the risk of significant losses from catastrophes and severe weather events;
risks related to the lack of a financial strength rating from A.M. Best;
risks related to limitations on the ability of our insurance subsidiary to pay dividends to us;
adverse capital, credit and financial market conditions;
risks related to volatility in net investment income;
the unavailability of reinsurance at current levels and prices;
the exposure to greater net insurance losses in the event of reduced reliance on reinsurance;
the credit risk of our reinsurers;
the inability to maintain the requisite amount of risk-based capital needed to grow our business;
the effects of climate change on the frequency or severity of weather events and wildfires;
risks related to the limited market area of our business;
risks related to a concentration of business in a limited number of producers;
legislative and regulatory changes, including changes in insurance laws and regulations and their application by our regulators;
limitations with regard to our ability to pay dividends;
the effects of competition in our market areas;
our reliance on certain key personnel;
risks related to security breaches or other attacks involving our computer systems or those of our vendors; and
our reliance on information technology and information systems.

Kingstone undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Definitions and Non-GAAP Measures

Direct premiums written represent the total premiums charged on policies issued by the Company during the respective fiscal period.

Net premiums written are direct premiums written less premiums ceded to reinsurers. Net premiums earned, the GAAP measure most comparable to direct premiums written and net premiums written, are net premiums written that are pro-rata earned during the fiscal period presented. All of the Company's policies are written for a twelve-month period. Management uses direct premiums written and net premiums written, along with other measures, to gauge the Company's performance and evaluate results. Direct premiums written and net premiums written are provided as supplemental information, not as a substitute for net premiums earned, and do not reflect the Company's net premiums earned.

Adjusted EBITDA is net income (loss) exclusive of interest expense, income tax expense (benefit), depreciation and amortization, loss on extinguishment of debt, net gains (losses) on investments, and stock- based compensation. Net income (loss) is the GAAP measure most closely comparable to adjusted EBITDA.

Management uses adjusted EBITDA along with other measures to gauge the Company's performance and evaluate results, which can be skewed when including interest expense, income tax expense (benefit), depreciation and amortization, loss on extinguishment of debt, net gains (losses) on investments, and stock-based compensation, and may vary significantly between periods. Adjusted EBITDA is provided as supplemental information, not as a substitute for net income (loss) and does not reflect the Company's overall profitability.

Operating net income (loss) and basic operating net income (loss) per shareis net income (loss) and basic income (loss) per share exclusive of net gains (losses) on investments, net of tax. Net income (loss) and basic net income (loss) per share are the GAAP measures most closely comparable to operating net income (loss) and basic operating net income (loss) per share.

Management uses operating net income (loss) and basic operating net income (loss) per share along with other measures to gauge the Company's performance and evaluate results, which can be skewed when including net gains (losses) on investments and may vary significantly between periods. Operating net income (loss) and basic operating net income (loss) per share are provided as supplemental information, not as a substitute for net income (loss) and basic net income (loss) per share and do not reflect the Company's overall profitability.

Operating net income (loss) and diluted operating net income (loss) per share is net income (loss) and diluted income (loss) per share exclusive of net gains (losses) on investments, net of tax. Net income (loss) and diluted net income (loss) per share are the GAAP measures most closely comparable to operating net income (loss) and diluted operating net income (loss) per share.

Management uses operating net income (loss) and diluted operating net income (loss) per share along with other measures to gauge the Company's performance and evaluate results, which can be skewed when including net gains (losses) on investments and may vary significantly between periods. Operating net income (loss) and diluted operating net income (loss) per share are provided as supplemental information, not as a substitute for net income (loss) and diluted net income (loss) per share, and do not reflect the Company's overall profitability.

Operating return on equity is operating income (loss) divided by average equity. Return on equity is the GAAP measure most closely comparable to operating return on equity.

Management uses operating return on equity, along with other measures, to gauge the Company's performance and evaluate results, which can be skewed when including net gains (losses) on investments, which may vary significantly between periods. Operating return on equity is provided as supplemental information, is not a substitute for return on equity and does not reflect the Company's overall return on average common equity.

Underlying loss ratiois a non-GAAP ratio, which is computed as the GAAP net loss ratio excluding the effect of prior year loss reserve development and catastrophe losses.

Management believes that this ratio is useful to investors, and it is used by management to reveal the trends in the Company's business that may be obscured by prior year loss reserve development and catastrophe losses. Catastrophe losses cause the Company's loss ratios to vary significantly between periods as a result of their incidence of occurrence and magnitude and can have a significant impact on the net loss ratio. Management believes that this measure is useful for investors to evaluate this component separately when reviewing the Company's underwriting performance. The most directly comparable GAAP measure is the net loss ratio. The underlying loss ratio should not be considered a substitute for the net loss ratio and does not reflect the Company's net loss ratio.

Net loss ratio excluding the effect of catastrophes is a non-GAAP ratio, which is computed as the difference between GAAP net loss ratio and the effect of catastrophes on the net loss ratio.

Management believes that this ratio is useful to investors, and it is used by management to reveal the trends in the Company's business that may be obscured by catastrophe losses. Catastrophe losses cause the Company's net loss ratios to vary significantly between periods as a result of their incidence of occurrence and magnitude and can have a significant impact on the net loss ratio. Management believes that this measure is useful for investors to evaluate this component separately when reviewing the Company's underwriting performance. The most directly comparable GAAP measure is the net loss ratio. The net loss ratio excluding the effect of catastrophes should not be considered a substitute for the net loss ratio and does not reflect the Company's net loss ratio.

The table below reconciles direct premiums written to net premiums earned for the periods presented:

	For the Three Months Ended									For the Years Ended
	December 31,									December 31,
							%									%
	2024			2023			Change			2024			2023			Change
(000's except percentages)
Direct Premiums Written Reconciliation:

Direct premiums written	$	72,533		$	52,938			37.0	%	$	241,980		$	200,175			20.9	%
Ceded written premiums¹		(18,369	)		(15,554	)		18.1			(87,750	)		(91,518	)		(4.1	)

Net premiums written		54,165			37,384			44.9			154,230			108,657			41.9
Change in unearned premiums		(18,197	)		(8,701	)		109.1			(25,732	)		5,727			(549.3	)

Net premiums earned	$	35,967		$	28,683			25.4	%	$	128,498		$	114,384			12.3	%