AUSTIN, Texas, March 13, 2026 /PRNewswire/ -- Kestrel Group Ltd $(KG)$ ("Kestrel" or the "Company") a leading specialty insurance platform that provides fronting services to program managers, reinsurers, and reinsurance brokers, today reported its financial results for the fourth quarter and full year ended December 31, 2025.
Key Highlights - Fourth Quarter 2025 Financials
-- Program Services net fee income was $1.9 million, up 94.5% over the third
quarter 2025
-- Premium produced(1) by Program Services clients was $93.8 million, up
79.2% over the third quarter 2025
-- Total revenues were $10.2 million
-- Net premiums earned were $3.4 million
-- As of December 31, 2025, the Company's book value per common share was
$16.57
-- Net loss was $17.8 million, driven by significant non-recurring charges
totaling $3.5 million and a downward adjustment to the bargain purchase
gain of $5.3 million recorded in the combination with Maiden Holdings,
Ltd. ("Maiden") in 2025; and
-- Net income for 2025 was $46.7 million, or $8.08 per diluted share(2).
Commenting on the results, Kestrel's Chief Executive Officer, Luke Ledbetter, stated, "The fourth quarter saw positive progress in our Program Services segment. Since completing the merger with Maiden in May of 2025, and after working through a complicated integration, which remains ongoing, we have gained momentum in our Program Services segment while simultaneously managing the legacy Maiden business. This quarter we took a meaningful step forward. I'm encouraged by the progress we've made, and I'm thankful for the hard work and dedication of our team.
"As we progress through 2026, we continue to work with our valued capacity providers to match our market opportunities with their allocated underwriting capacity and are diligently exploring opportunities to expand our ability to write attractive fee-based business in a highly competitive marketplace. We remain committed to developing the strategic framework to facilitate future growth that will drive value for Kestrel shareholders. Our goal is innovation, client service and long-term relationships as we strive to generate a balance sheet light, fee revenue model while selectively deploying underwriting capacity to optimize returns for shareholders," concluded Ledbetter.
Total revenues in the fourth quarter of 2025 were $10.2 million. Total revenues for 2025 were $34.0 million(2) . Net loss from continuing operations in the fourth quarter of 2025 was $16.4 million, or a loss of $2.12 per diluted share, compared to net loss of $4.1 million, or a loss of $0.53 per diluted share, for the third quarter of 2025. The net loss for the fourth quarter of 2025 was negatively impacted by a series of significant non-recurring or one-time items including:
-- An adjustment of $5.3 million to reduce the bargain purchase gain
recorded as a result of the Combination with Maiden based on revised
information that impacted the fair value of an asset;
-- Legal and other professional fees associated with the Company's
previously disclosed arbitration totaling $2.0 million; and
-- Restructuring and related severance costs associated with various
headcount reductions in the fourth quarter of 2025 totaling $0.8 million.
Non-GAAP operating loss was $8.2 million for the fourth quarter of 2025, including the impact of non-recurring items above. Please see "Non-GAAP Financial Measures" for further details. In addition to the non-GAAP operating loss the fourth quarter 2025 included certain one-time charges of $0.5 million associated with the commutation of a reinsurance contract in the Company's International Insurance Services business, and expenses for certain legal matters of $0.2 million.
Program Services Segment
The Program Services segment provides fronting services to general agents and insurance carriers to leverage Kestrel's trusted reputation to provide access to the U.S. property and casualty insurance market and insurance paper rated "A-" (Excellent) A.M. Best rating and expansive licenses in exchange for fees. Kestrel issues the policy through exclusive use of four insurance carriers, and those carriers presently retain and reinsure the risk. The Company continues to actively pursue reinsurance mechanisms with its existing partners that would selectively deploy the Company's underwriting capacity that it believes could facilitate and accelerate both its fee and premium revenue growth.
In the fourth quarter of 2025, total fee revenues from the Program Services segment were $3.1 million, which represents a 91.5% sequential increase compared to the third quarter of 2025. These revenues are derived from fees from both new and existing client programs. Premium produced by client programs during the fourth quarter 2025 totaled $93.8 million, a 79.2% increase over the third quarter 2025.
Year to date 2025 premium produced by client programs totaled $188.3 million, an 81.4% increase over the $103.8 million in premium produced by client programs in 2024. This resulted in $6.1 million of fee revenue for the year ended December 31, 2025, a 67.2% increase compared with $3.6 million for 2024.
Legacy Reinsurance Segment
The Legacy Reinsurance segment consists of the AmTrust Reinsurance and Diversified Reinsurance segments previously reported by Maiden prior to the Combination with Kestrel. The AmTrust portion of this segment includes all business ceded to Maiden Reinsurance by AmTrust. The Diversified portion of this segment consists of a run-off portfolio of predominantly third-party property and casualty reinsurance business focusing on regional and specialty property and casualty insurance companies located primarily in Europe, as well as business produced by Maiden LF and Maiden GF along with transactions entered into by GLS.
During the fourth quarter of 2025, the Legacy Reinsurance segment produced an underwriting loss of $7.6 million, compared to an underwriting loss of $9.0 million in the third quarter of 2025. The underwriting loss in the fourth quarter included $3.2 million of losses related to the segment's AmTrust business and $4.3 million of losses related to the Diversified business, which included $3.3 million in non-recurring charges.
The AmTrust business reported an underwriting loss of $2.9 million for the current accident year in the fourth quarter of 2025 as the run-off of certain multiple year policies continues. In addition, there was approximately $0.4 million in adverse prior period loss development ("PPD") during the fourth quarter of 2025. Net adverse PPD consisted of $4.8 million from the AmTrust Quota Share, which was largely offset by an increase of $4.2 million in the amount recoverable under the Loss Portfolio Transfer and Adverse Development Cover Agreement ("LPT/ADC Agreement") with Cavello Bay Reinsurance Limited. AmTrust's Hospital Liability business experienced modestly favorable development of approximately $0.3 million which was offset by adverse development on older excess of loss coverages. PPD in the Master Quota Share largely emanated from AmTrust's international structural defect and warranty business. More modest adverse development in U.S. small commercial and program business was substantially offset by continuing favorable development in Workers' Compensation and other lines of business.
The results for the segment's Diversified business include $2.8 million in non-recurring expenses related to aforementioned arbitration and employee separation matters, as well as an additional non-recurring net charge of $0.5 million related to final accounting and commutation of an IIS-related reinsurance contract. Excluding these non-recurring charges, the adjusted underwriting loss for the fourth quarter was $1.0 million, which reflects the ongoing run-off of the Company's international operations.
Investment Activities and Other Gains
The Company reported combined income from investment activities totaling $3.7 million for the three months ended December 31, 2025, resulting from net investment income of $3.3 million and realized and unrealized investment gains of $0.4 million, the latter of which was from Maiden's legacy alternative asset portfolio.
Also, during the fourth quarter, the Company recognized foreign exchange and other gains of $0.4 million. This included a gain of $0.9 million in the revaluation of a contingent receivable in the insurance distribution industry partly offset by net foreign exchange losses due to depreciation of the U.S dollar on the re-measurement of net loss reserves and insurance related liabilities denominated in the British pound and euro.
General and Administrative Expenses
Excluding general and administrative expenses allocated to segments, and non-recurring expenses for certain legal matters that were $0.2 million in the fourth quarter of 2025, corporate general and administrative expenses were $5.2 million, reflecting elevated levels of certain costs such as legal and professional fees related to ongoing litigation and other legal matters.
Balance Sheet
Total assets were $1.0 billion at December 31, 2025, and shareholders' equity was $128.3 million.
As of December 31, 2025, the Company has available net operating loss ("NOL") carryforwards of $473.1 million for income tax purposes. Approximately $388.7 million of NOL carryforwards expire in various years beginning in 2029. As of December 31, 2025, approximately $84.4 million or 17.8% of the Company's NOL carryforwards have no expiry date under the relevant U.S. tax law.
Investor Presentation
The Company has posted an investor presentation on its website in connection with this earnings release. The presentation, dated March 2026 can be found at https://kestrelgroup.gcs-web.com/events-and-presentations/presentations.
Non-GAAP Reconciliations
Please see "Non-GAAP Financial Measures" at the end of this earnings release for additional information on non-GAAP financial measures and reconciliations of these measures to their most directly comparable financial measures calculated and presented in accordance with GAAP.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the Company's current expectations and are subject to risks and uncertainties that may cause actual results to differ materially. Factors that could cause differences are discussed in the Company's SEC filings, including the Company's Annual Report on Form 10-K for the year ended December 31, 2025.
Various statements contained in this press release are forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may include projections and estimates concerning the anticipated benefits of the business combination and integration of Maiden Holdings and Kestrel, the timing and success of specific projects and strategies for growth, and our future production, revenues, income, expenses, capital spending, and reserves. Our forward-looking statements are generally, but not always, accompanied by words such as "estimate," "believe," "expect," "will," "plan," "target," "could" or other words that convey the uncertainty of future events or outcomes.
There can be no assurance that actual developments will be those anticipated by us. Actual results may differ materially from those expressed or implied in these statements as a result of significant risks and uncertainties, including, but not limited to, our ability to recover from our capacity providers, the cost and availability of reinsurance coverage, challenges to our use of issuing carrier or fronting arrangements by regulators or changes in state or federal insurance or other statutes or regulations, our dependence on a limited number of business partners, our ability to compete effectively, a downgrade in the financial strength ratings of insurance carriers utilized for fronting arrangements, our ability to accurately underwrite and price our products and to maintain and establish accurate loss reserves, opportunities to expand our ability to write fee-based business, our ability to implement reinsurance mechanisms to selectively deploy underwriting capacity, our ability to manage our legacy business and ongoing run-off of our international operations, changes in interest or foreign exchange rates or other changes in the financial markets, availability and sources of liquidity, timing and amount of expenditures, the effects of emerging claim and coverage issues, changes in the demand for our products, outcomes of ongoing litigation or other legal matters, the effect of general economic conditions, breaches in data security or other disruptions with our technology, changes in pricing or other competitive environments, and the development and success of strategies or other initiatives.
Forward-looking statements involve inherent risks and uncertainties that are difficult to predict, many of which are beyond our control. Additional information about these risks and uncertainties is contained in our filings with the Securities and Exchange Commission. The forward-looking statements in this press release speak only as of the date of this release, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Kestrel Group
Kestrel Group Ltd specializes in providing fronting services to insurance program managers, managing general agents (MGAs), reinsurers, and reinsurance brokers. Kestrel Group facilitates insurance transactions utilizing its exclusive management contracts with four insurance carriers, all of which are rated A- "Excellent" by A.M. Best. These contracts enable Kestrel Group to offer both admitted and surplus lines in all U.S. states. Kestrel Group generally does not assume significant underwriting risk and produces lines of business such as casualty, workers' compensation, catastrophe-exposed property, and non-catastrophe-exposed property, with diverse risk durations, sizes, and product types. To learn more about Kestrel Group, please visit https://kestrelgroup.com.
Contact:
Kestrel Group Investor Relations
Rick Black / Ken Dennard
KG@dennardlascar.com
KESTREL GROUP LTD
CONSOLIDATED BALANCE SHEETS
(In thousands of U.S. dollars, except share and per share data)
December 31, December 31,
2025 2024
------------------- ----------------------
(Audited) (Audited)
ASSETS
Investments:
Fixed maturities,
available-for-sale, at fair
value (Amortized cost 2025
- $162,472) $ 163,167 $ --
Equity securities, at fair
value (Cost: 2025 -
$11,145) 11,748 --
Equity method investments 33,532 --
Other investments 173,358 --
------------------- ----------------------
Total investments 381,805 --
Cash and cash equivalents 7,801 4,286
Restricted cash and cash
equivalents 9,146 --
Accrued investment income 4,970 --
Reinsurance balances
receivable, net 724 --
Reinsurance recoverable on
unpaid losses 461,197 --
Net loan receivable from
related party 86,883 --
Intangible assets 9,347 --
Funds withheld receivable 10,956 --
Other assets 17,631 1,224
Assets held for sale 19,495 --
------------------- ----------------------
Total assets $ 1,009,955 $ 5,510
=================== ======================
LIABILITIES
Reserve for loss and loss
adjustment expenses $ 637,169 $ --
Unearned premiums 17,406 --
Accrued expenses and other
liabilities 51,572 904
Senior notes - principal
amount 262,361 --
Less: unamortized fair
value adjustment 87,959 --
------------------- ----------------------
Senior notes, net 174,402 --
Liabilities held for sale 1,122 --
------------------- ----------------------
Total liabilities 881,671 904
------------------- ----------------------
Commitments and
Contingencies
EQUITY
Common shares 100 27
Additional paid-in capital 177,534 10,107
Accumulated other
comprehensive income 916 --
Retained earnings
(accumulated deficit) 1,197 (5,528)
Treasury shares, at cost (51,463) --
Total Equity 128,284 4,606
------------------- ----------------------
Total Liabilities and Equity $ 1,009,955 $ 5,510
=================== ======================
Book value per common
share(3) $ 16.57 $ 1.67
Common shares outstanding 7,741,943 2,749,996
KESTREL GROUP LTD
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(In thousands of U.S. dollars, except share and per share data)
For the Three Months Ended
December 31, For the Year Ended December 31,
---------------------------------
2025 2024 2025 2024
--------------- ---------------- --------------- --------------- ----------------
Revenues:
Gross premiums
written $ 1,235 $ -- $ 6,091 $ --
---------------- --------------- --------------- ----------------
Net premiums
written $ 1,219 $ -- $ 6,209 $ --
Change in
unearned
premiums 2,196 -- 6,464 --
---------------- --------------- --------------- ----------------
Net premiums
earned 3,415 -- 12,673 --
Fee revenue 3,104 1,177 6,076 3,634
Net investment
income 3,284 43 8,343 213
Net realized and
unrealized
investment
gains 405 -- 6,957 --
Total
revenues 10,208 1,220 34,049 3,847
---------------- --------------- --------------- ----------------
Expenses:
Net loss and
loss adjustment
expenses 4,547 -- 8,992 --
Commission and
other
acquisition
expenses 1,019 -- 3,131 --
General and
administrative
expenses 12,056 1,128 29,062 5,108
---------------- --------------- --------------- ----------------
Total
expenses 17,622 1,128 41,185 5,108
---------------- --------------- --------------- ----------------
Other expenses
Interest and
amortization
expenses 4,218 -- 9,865 --
Gain on bargain
purchase 5,284 -- (68,306) --
Foreign exchange
and other
(gains) losses (432) -- 1,723 --
---------------- --------------- --------------- ----------------
Total other
expenses 9,070 -- (56,718) --
---------------- --------------- --------------- ----------------
Net (loss)
income before
income taxes (16,484) 92 49,582 (1,261)
Less: income
tax (benefit)
expense (34) 30 68 30
Interest in
income of
equity method
investments 48 -- 24 --
---------------- --------------- --------------- ----------------
Net (loss)
income from
continuing
operations (16,402) 62 49,538 (1,291)
Loss from
discontinued
operations, net
of income tax (1,353) -- (2,813) --
---------------- --------------- --------------- ----------------
Net (loss)
income $ (17,755) $ 62 $ 46,725 $ (1,291)
Basic and
diluted (loss)
earnings per
share from
continuing
operations $ (2.12) $ 0.02 $ 8.57 $ (0.47)
Basic and
diluted loss
per share from
discontinued
operations (0.17) -- (0.49) --
---------------- --------------- --------------- ----------------
Basic and
diluted (loss)
earnings per
share
attributable to
Kestrel common
shareholders $ (2.29) $ 0.02 $ 8.08 $ (0.47)
Annualized
return on
average common
equity (51.8) % 5.4 % 70.3 % (24.7) %
Weighted average
number of
common shares -
basic and
diluted 7,741,943 2,749,996 5,731,380 2,749,996
KESTREL GROUP LTD
SUPPLEMENTAL FINANCIAL DATA - SEGMENT INFORMATION (Unaudited)
(in thousands of U.S. dollars)
For the Three
Months Ended
December 31, Legacy
2025 Reinsurance Program Services Total
----------------- --------------------- --------------------- -------------------
Gross premiums
written $ 1,235 $ -- $ 1,235
===================== ===================== ===================
Net premiums
written $ 1,219 $ -- $ 1,219
===================== ===================== ===================
Net premiums
earned $ 3,415 $ -- $ 3,415
Fee revenue -- 3,104 3,104
Net loss and loss
adjustment
expenses ("loss
and LAE") (4,547) -- (4,547)
Commission and
other acquisition
expenses (1,019) -- (1,019)
General and
administrative
expenses(4) (5,429) (1,243) (6,672)
--------------------- --------------------- -------------------
Underwriting loss
and fee
income(5) $ (7,580) $ 1,861 (5,719)
===================== =====================
Reconciliation to
net loss from
continuing
operations
Net investment
income and net
realized and
unrealized
investment gains 3,689
Interest and
amortization
expenses (4,218)
Gain on bargain
purchase (5,284)
Foreign exchange
and other gains,
net 432
Other general and
administrative
expenses(4) (5,384)
Income tax benefit 34
Interest in income
of equity method
investments 48
-------------------
Net loss from
continuing
operations $ (16,402)
===================
For the Three
Months Ended
December 31, Legacy
2024 Reinsurance Program Services Total
Fee revenue $ -- $ 1,177 $ 1,177
General and
administrative
expenses(4) -- (564) (564)
--------------------- --------------------- -------------------
Fee income(5) $ -- $ 613 613
===================== =====================
Reconciliation to
net income
Net investment
income 43
Other general and
administrative
expenses(4) (564)
Income tax expense (30)
Net income $ 62
===================
KESTREL GROUP LTD
SUPPLEMENTAL FINANCIAL DATA - SEGMENT INFORMATION (Unaudited)
(in thousands of U.S. dollars)
For the Year
Ended December Legacy
31, 2025 Reinsurance Program Services Total
--------------- --------------------- --------------------- ---------------
Gross premiums
written $ 6,091 $ -- $ 6,091
===================== ===================== ===============
Net premiums
written $ 6,209 $ -- $ 6,209
===================== ===================== ===============
Net premiums
earned $ 12,673 $ -- $ 12,673
Fee revenue -- 6,076 6,076
Net loss and LAE (8,992) -- (8,992)
Commission and
other
acquisition
expenses (3,131) -- (3,131)
General and
administrative
expenses(4) (10,861) (3,246) (14,107)
--------------------- --------------------- ---------------
Underwriting
loss and fee
income(5) $ (10,311) $ 2,830 (7,481)
===================== =====================
Reconciliation
to net income
from continuing
operations
Net investment
income and net
realized and
unrealized
investment
gains 15,300
Interest and
amortization
expenses (9,865)
Gain on bargain
purchase 68,306
Foreign exchange
and other
losses, net (1,723)
Other general
and
administrative
expenses(4) (14,955)
Income tax
expense (68)
Interest in
income from
equity method
investments 24
---------------
Net income from
continuing
operations $ 49,538
===============
For the Year
Ended December Legacy
31, 2024 Reinsurance Program Services Total
Fee revenue $ -- $ 3,634 $ 3,634
General and
administrative
expenses(4) -- (2,554) (2,554)
--------------------- --------------------- ---------------
Fee income(5) $ -- $ 1,080 1,080
===================== =====================
Reconciliation
to net loss
Net investment
income 213
Other general
and
administrative
expenses(4) (2,554)
Income tax
expense (30)
Net loss $ (1,291)
===============
KESTREL GROUP LTD
NON-GAAP FINANCIAL MEASURES (Unaudited)
(In thousands of U.S. dollars, except share and per share data)
For the Three Months Ended
December 31, For the Year Ended December 31,
----------------------------------
2025 2024 2025 2024
----------------- ----------------- ------------------ ---------------- ----------------
Non-GAAP operating
(loss)
earnings(6) $ (8,190) $ 62 $ (13,819) $ (1,291)
================= ================== ================ ================
Non-GAAP basic and
diluted operating
(loss) earnings
per common share
attributable to
Kestrel common
shareholders(6) $ (1.06) $ 0.02 $ (2.41) $ (0.47)
================= ================== ================ ================
Annualized
non-GAAP
operating return
on average
adjusted common
equity(7) (23.9) % 5.4 % (20.8) % (24.7) %
================= ================== ================ ================
Reconciliation of
net (loss) income
to non-GAAP
operating (loss)
earnings:
Net (loss) income $ (17,755) $ 62 $ 46,725 $ (1,291)
Add (subtract):
Net realized and
unrealized
investment
gains (405) -- (6,957) --
Amortization of
intangible
assets 1,023 -- 2,517 --
Foreign exchange
and other
(gains) losses (432) -- 1,723 --
Interest in
income of equity
method
investments (48) -- (24) --
Litigation costs
from GLS related
arbitration 2,006 -- 2,575 --
Change in
bargain
purchase gain 5,284 -- (68,306) --
Net loss from
discontinued
operations 1,353 -- 2,813 --
Restructuring and
severance costs 784 -- 3,107 --
Costs incurred
due to the
Combination -- -- 2,008 --
Non-GAAP operating
(loss)
earnings(6) $ (8,190) $ 62 $ (13,819) $ (1,291)
================= ================== ================ ================
Weighted average
number of common
shares - basic
and diluted 7,741,943 2,749,996 5,731,380 2,749,996
Reconciliation of diluted (loss) earnings per share
attributable to Kestrel common shareholders to non-GAAP
diluted operating (loss) earnings per share attributable
to Kestrel common shareholders:
Diluted (loss)
earnings per
share
attributable to
common
shareholders $ (2.29) $ 0.02 $ 8.08 $ (0.47)
Add (subtract):
Net realized and
unrealized
investment
gains (0.05) -- (1.19) --
Amortization of
intangible
assets 0.13 -- 0.44 --
Foreign exchange
and other
(gains) losses (0.06) -- 0.32 --
Interest in
income of equity
method
investments (0.01) -- -- --
Litigation costs
from GLS related
arbitration 0.26 -- 0.45 --
Change in bargain
purchase gain 0.68 -- (11.90) --
Net loss from
discontinued
operations 0.18 -- 0.50 --
Restructuring and
severance costs 0.10 -- 0.54 --
Costs incurred
due to the
Combination -- -- 0.35 --
Non-GAAP diluted
operating (loss)
earnings per
share
attributable to
common
shareholders(6) $ (1.06) $ 0.02 $ (2.41) $ (0.47)
================= ================== ================ ================
KESTREL GROUP LTD
NON-GAAP FINANCIAL MEASURES (Unaudited)
(In thousands of U.S. dollars, except share and per share data)
December 31, December 31,
2025 2024
----------------- -------------------
Investable assets:
Total investments $ 381,805 $ --
Cash and cash equivalents 7,801 4,286
Restricted cash and cash equivalents 9,146 --
Net loan receivable from related
party 86,883 --
Funds withheld receivable 10,956 --
----------------- -------------------
Total investable assets(8) $ 496,591 $ 4,286
================= ===================
Capital:
Total shareholders' equity $ 128,284 $ 4,606
2016 Senior Notes 110,000 --
2013 Senior Notes 152,361 --
----------------- -------------------
Total capital resources(9) $ 390,645 $ 4,606
================= ===================
(1) Premium produced is an operating metric determined by management as a
byproduct of the program services fees it earns and is paid by clients.
Premium produced is equal to the premium written by an MGA or capacity
provider, and management believes this measure is important in understanding
the underlying production trends of its Program Services business and the fees
it earns. Where available, the Company utilizes underlying premium produced as
reported by its clients. Where the premium produced was not directly
observable, the Company derived the premium produced by grossing up the known
fee component using the applicable contractual fee percentage, including its
arrangements with its insurance carrier partners.
(2) Full year 2025 results are not comparable to prior periods due to the
merger with Maiden Holdings, which was accounted for as a reverse merger.
(3) Book value per common share is calculated using shareholders' equity
divided by the number of common shares outstanding. Management uses growth in
this metric as a prime measure of the value we are generating for our common
shareholders, because management believes that growth in this metric
ultimately results in growth in the Company's common share price. This metric
is impacted by the Company's net income and external factors, such as interest
rates, which can drive changes in unrealized gains or losses on our investment
portfolio as well as share repurchases.
(4) Underwriting and fee income related general and administrative expenses is
a non-GAAP measure and includes expenses which are segregated for analytical
purposes as a component of underwriting and fee income (loss).
(5) Underwriting and fee income or loss is a non-GAAP measure and is
calculated as net premiums earned plus fee revenue less net loss and LAE,
commission and other acquisition expenses and general and administrative
expenses directly related to underwriting and fee revenue activities. For
purposes of these non-GAAP operating measures, the fee-generating business,
which is included in our Program Services segment, is considered part of the
underwriting and fee income operations of the Company. Management believes
that this measure is important in evaluating the underwriting and fee income
performance of the Company and its segments. This measure is also a useful
tool to measure the profitability of the Company separately from the
investment results and is also a widely used performance indicator in the
insurance industry.
(6) Non-GAAP operating earnings (loss) and non-GAAP basic and diluted
operating earnings (loss) per common share are non-GAAP financial measure
defined by the Company as net income (loss) excluding realized investment
gains and losses, foreign exchange and other gains and losses, interest in
income (loss) of equity method investment, and amortization of intangible assets and should not be considered as an alternative to net income (loss). It also excludes on a non-recurring basis: (1) loss from discontinued operations, net of income tax; (2) the bargain purchase gain resulting from the Combination; (3) litigation costs from GLS related arbitration; (5) restructuring and severance costs; (6) and costs incurred due to the Combination. The Company's management believes that the use of non-GAAP operating earnings (loss) and non-GAAP diluted operating earnings (loss) per common share enables investors and other users of the Company's financial information to analyze its performance in a manner similar to how management analyzes performance. Management also believes that these measures generally follow industry practice therefore allowing the users of financial information to compare the Company's performance with its industry peer group, and that the equity analysts and certain rating agencies which follow the Company, and the insurance industry as a whole, generally exclude these items from their analyses for the same reasons. Non-GAAP operating earnings should not be viewed as a substitute for U.S. GAAP net income. (7) Non-GAAP operating return on average shareholders' equity is a non-GAAP financial measure. Management uses non-GAAP operating return on average adjusted shareholders' equity as a measure of profitability that focuses on the return to common shareholders. It is calculated using non-GAAP operating earnings divided by average shareholders' equity. (8) Investable assets are the total of the Company's investments, cash and cash equivalents, net loan receivable from related party and funds withheld receivable. (9) Total capital resources are the sum of the Company's principal amount of debt and shareholders' equity.
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SOURCE Kestrel Group Ltd
(END) Dow Jones Newswires
March 13, 2026 08:00 ET (12:00 GMT)