Hello, and thank you for standing by. At this time, I would like to welcome you to the James River Group Q4 2024 Earnings Call. [Operator Instructions] I would now like to turn the conference over to Zachary Shytle, Investor Relations. Please go ahead.

Good morning, everyone, and welcome to the James River Group Fourth Quarter 2024 Earnings Conference Call. During the call, we may be making forward-looking statements. These statements are based on current beliefs, intentions, expectations and assumptions that are subject to various risks and uncertainties, which may cause actual results to differ materially. For a discussion of such risks and uncertainties, please see the cautionary language regarding forward-looking statements in yesterday's earnings release and the risk factors of our most recent Form 10-K and other reports and filings we have made with the Securities and Exchange Commission. We do not undertake any duty to update any forward-looking statements. In addition, during this presentation, we may reference non-GAAP financial measures. Please refer to our earnings press release for a reconciliation of these numbers to GAAP, a copy of which can be found on our website at www.jrvrgroup.com. Lastly, unless otherwise specified, for the reasons described in our earnings press release, all underwriting performance ratios referred to are for our continuing operations and business that is not subject to retroactive reinsurance accounting for loss portfolio transfers. I will now turn the call over to Frank D'Orazio, Chief Executive Officer of James River Group. Frank D’Orazio: Thank you for that introduction, Zach. Good morning, everyone, and welcome to our fourth quarter 2024 earnings call. I'm pleased to be joining you today to provide additional color on our fourth quarter and full year 2024 results, but just as importantly, to impart our thoughts on the direction and opportunities that lie ahead for the organization. For James River, 2024 was a costly year, but also a transformative step forward in our efforts to put our legacy issues behind the organization and position it to prosper and thrive as a top-tier E&S franchise. We successfully executed several…

Thanks very much, Frank. Good morning, everyone, and thanks for joining us today. I wanted to focus my comments on key dynamics that are driving our results for the quarter as well as provide high-level guidance for 2025. For the fourth quarter, we're reporting an adjusted net operating loss of $40.8 million or $0.99 per share and a net loss from continuing operations available to common shareholders of $92.7 million or $2.25 per share. The loss was largely attributed to the 2 items we announced in November. These were the $52.8 million of consideration paid for the top-up adverse development cover, which we closed in late December and accounted for as an increase in ceded premium as well as a $27 million deemed dividend resulting from the amendment to the Series A preferred shares. As a reminder, we also sold $12.5 million of primary common stock to Enstar for $6.40 per share in late December. First, I'd like to peel apart our performance and view for the year ahead and then I'll come back to spend a minute on the deemed dividend. Clearly, 2024, as Frank said, was a costly year for James River and the 2 retroactive reinsurance structures we purchased significantly distort the run rate performance of the underlying E&S operations in particular. Our flagship E&S operations are simple and straightforward and perform well at meaningful scale. They're poised for profitable growth, especially given market conditions, submission growth and the many underwriting changes we've made over the last few years. The $52.8 million payment for the top-up adverse development cover this quarter reduced net written and earned premium, pressuring the loss and expense ratio. Absent the impact of the retroactive structures, E&S would have generated an 89.3% accident year combined ratio, a compelling result for a business experiencing…

[Operator Instructions] First question comes from the line of Meyer Shields from KBW.

It's [ Dean ] on for Meyer. My first question is on the submission growth. You guys reported 9% submission growth. I'm just wondering like how is the trend looking in 2025? Are you seeing any changes in the competitive dynamics in the market? Frank D’Orazio: Thanks for your question. So yes, we have seen an increase just relative to submissions. I think overall, several of our divisions, I think, demonstrated pretty healthy growth in '24 despite competition in the excess property market specifically. We saw very healthy growth in sports and entertainment, environmental, general casualty and small business, just to name a few. I think we've been pretty transparent about our activities in excess casualty related to heavy commercial auto accounts. But when you exclude our excess casualty division, our growth for the quarter would have been 11.2%. To your point, we reported submission growth of 9% for the quarter. Definitely not isolated to any single line. Allied Health was up. Environmental submissions were up, general casualty submissions up. So overall, fairly healthy in terms of well-rounded opportunities for the underwriting platform. If you look at gross premium for December, the first full month following the conclusion of our strategic review, we saw 7.5% growth compared to the prior year quarter. So I think with the conclusion of the strategic review and the reaffirmation of our rating, we feel we can provide our distribution partners and insurers with more certainty, which should provide additional tailwind into 2025. Just relative to overall competition, again, we are seeing it specifically in the property marketplace, maybe a little bit stronger relative to some of the larger accounts that we run into. But overall, I don't know that it's been necessarily a change versus what we've experienced over the course of '24.

Got it. Makes sense. I have a follow-up on, I guess, the loss picks. You guys raised the loss picks to be more conservative. You mentioned that you're seeing some trend in excess casualty and general casualty. I'm just curious, is it the same frequency trend that you're seeing from manufacturer? Yes. Any color on that would be great. Frank D’Orazio: Sure. So I think if you're asking about loss trends in our view relative to 2025, which we have recently refreshed, I would say, overall, our view is slightly higher across the portfolio, call it, just under a point higher, primarily driven by increases in excess casualty and general casualty. But in the aggregate, we're projecting loss trend to remain in that same high single-digit range. Several of our underwriting divisions are in the mid single digit range. And on the other end of the spectrum, we have 1 or 2 in the low double digit range. Now that's offset, as you know, by exposure trend and it certainly varies across our divisions. But for 2025, again, rolled up, it remains virtually unchanged in the low single-digit range.

[Operator Instructions] There are no further questions at this time. Frank D'Orazio, I'll turn the call back over to you. Frank D’Orazio: Okay. Thank you, operator. I want to thank everybody for their time today. I also want to point out that for James River, the significance of Q4 and really all of 2024 is more about the steps we've taken to simplify the company and derisk the balance sheet with significant legacy cover protection still in place. So clearly, all items we had previously reported on, but critical because of the implications of that protection on future performance, while the company operates in what is still a very attractive trading environment for E&S, leveraging all of the good underwriting and performance monitoring improvements we've made over the last few years. For us, it's very much about 2025 and the future for James River more than anything else. Before we leave, I also want to acknowledge and thank Ollie Sherman for his 9 years of service to James River as both a Non-Executive Director and most recently as Chairman. Ollie has chosen to retire from the Board at the end of April and we will certainly -- we will miss his leadership and guidance. We're also very fortunate to have elected Christine LaSala as our new Non-Executive Chairperson. And personally, I look forward to working closely with her to chart the future of James River. All right. We look forward to speaking with you all again in just a few weeks to discuss our first quarter results and progress. Enjoy the rest of your day.

This concludes today's call. Thank you for joining. You may now disconnect.