Assured Guaranty Ltd (AGO) Reports Strong Earnings for Q3 2023
AGO reports a net income of $157 million, or $2.60 per share, for Q3 2023.
Adjusted operating income stands at $206 million, or $3.42 per share.
Shareholders equity per share rises to $90.84, with adjusted book value per share at $148.03.
Capital returned to shareholders totals $80 million, including share repurchases and dividends.
On November 7, 2023, Assured Guaranty Ltd (NYSE:AGO) announced its financial results for the third quarter of 2023, highlighting significant gains and strategic achievements. The company reported a net income attributable to AGO of $157 million, or $2.60 per share, a substantial increase from the $11 million, or $0.18 per share, reported in the same period last year. The filing release date for these results was November 7, 2023.
Financial Performance Overview
AGO's shareholders equity per share increased from $85.80 at the end of 2022 to $90.84 as of September 30, 2023. The non-GAAP financial measures also showed strength, with adjusted operating income reaching $206 million, or $3.42 per share, and adjusted operating shareholders equity per share at $99.18. The adjusted book value (ABV) per share also saw a rise to $148.03.
Key Financial Highlights
The company's gross written premiums (GWP) for the third quarter stood at $40 million, and the present value of new business production (PVP) was reported at $46 million. A significant gain of $241 million was recorded from the transactions with Sound Point Capital Management and Assured Healthcare Partners LLC (AHP), contributing to the overall positive results.
Strategic Developments and Capital Management
President and CEO Dominic Frederico commented on the strategic objectives achieved, including the completion of transactions with Sound Point and AHP, which led to a notable pre-tax gain. He also noted the company's increased market share in municipal bond insurance and diversified underwriting strategy. AGO's capital management initiatives included refinancing $330 million of senior debt and accelerating share repurchases, with an additional $300 million authorized for repurchases on November 1, 2023.
Assured Guaranty achieved important strategic objectives in asset management, new business production and capital management during the third quarter and first nine months of 2023, said Dominic Frederico.
Insurance Segment Performance
The Insurance segment, which provides credit protection products, reported adjusted operating income of $59 million for Q3 2023, a decrease from $159 million in the same period last year. This was primarily due to higher loss expenses, partially offset by higher income from the investment portfolio.
Asset Management and Corporate Division
Following the transactions with Sound Point and AHP, AGO continues its participation in asset management through a 30% ownership interest in Sound Point. The Corporate Division's adjusted operating income included a pre-tax gain from these transactions, net of transaction costs.
Share Repurchase and Dividend Payouts
AGO returned $80 million to shareholders in Q3 2023, including $64 million in share repurchases and $16 million in dividends. The Board authorized an additional $300 million for share repurchases, demonstrating confidence in the company's financial health and commitment to delivering shareholder value.
Assured Guaranty Ltd (NYSE:AGO) has shown resilience and strategic acumen in its Q3 2023 financial results, with significant gains in net income and adjusted operating income. The company's strategic transactions and capital management efforts have positioned it well for continued success. Investors and analysts can look forward to AGO's continued performance in the coming quarters.
Please refer to Assured Guarantys September 30, 2023 Financial Supplement for more detailed information on the company's financial guaranty portfolio, investment portfolio, and other items, which is available on the company's website.
For further details and to access the full earnings report, visit AssuredGuaranty.com.
Explore the complete 8-K earnings release (here) from Assured Guaranty Ltd for further details.
This article first appeared on GuruFocus.
