3, 2026 CALL PARTICIPANTS Chief Executive Officer - Greg RichardsonChairman of the Board of Directors - David EinhornChief Financial Officer - Faramarz RomerGeneral Counsel - David E.
Sigmon Net Income -- $3.2 million, or $0.10 per diluted share, representing a return to profitability compared to a net loss of $4.4 million in the third quarter of 2025.Combined Ratio -- 90.5%, reflecting strong underlying profitability and a relatively benign catastrophe environment during the quarter.Underwriting Income -- $14.6 million, compared to $22.3 million in the prior-year period.Fully Diluted Book Value Per Share -- $20.78, representing an 0.8% increase during the quarter and a 1.7% increase for the first nine months of the year.Gross Written Premiums -- $181.9 million, a decrease of 1% driven by a 10.4% contraction in the open market segment.Net Written Premiums -- $142.7 million, a 12.3% decrease resulting from the expanded use of outward reinsurance and third-party capital.Innovations Gross Written Premium -- $43.0 million, an increase of 46% driven by new business and exposure growth from existing treaties.Solasglas Fund Return -- Negative 3.3%, as the long portfolio detracted 7.6% while the short portfolio contributed 7.3%.Middle East Conflict Provision -- Reduced by $6 million in the third quarter after more detailed information on specific individual losses became available.Innovations Investment Gains -- $4.1 million realized from the partial sale of two investments within the innovations portfolio.Share Repurchases -- 505,000 shares for $8 million during the third quarter, with an additional 220,000 shares purchased in October for $3.3 million.Year-to-Date Capital Return -- The company has repurchased 5.4% of its outstanding shares for $30.5 million since the beginning of 2026.Open Market Combined Ratio -- 87.9%, compared to 84.5% in the third quarter of 2025, primarily due to higher attritional loss ratios in the specialty business.Innovations Combined Ratio -- 98.2%, reflecting adverse prior year reserve development of 7.6 percentage points.Adverse Reserve Development -- 1.6 points of prior year reserve strengthening, mostly related to a small number of contracts within the Innovations segment.Open Market Net Written Premiums -- $114.2 million, a 19% decrease resulting from lowered premium estimates on specialty and property proportional contracts.Investment Exposure -- 32% net exposure at the end of the third quarter, which further decreased to approximately 28% by the end of October.Share Repurchase Agreement -- A structured agreement to repurchase 33% of shares from Chairman David Einhorn relative to open market purchases to maintain his ownership percentage for tax considerations.
Need a quote from a Motley Fool analyst? Email [email protected] David Einhorn stated, "The 500 index advanced 2.3%.
While the market advanced, our long and short portfolios behaved as if they were in a bear market," noting that many positions declined between 10% to 25% during the quarter.Faramarz Romer reported that prior year adverse reserve development was 1.6 points, and "Most of the reserve strengthening related to a handful of contracts within the innovation segment."Einhorn warned that Brighthouse Financial shares fell 21% "amid increasing concern that regulators would block or delay its pending acquisition by Aquarian Capital." Greenlight Capital Re, Ltd.
(GLRE +1.52%) reported third quarter net income of $3.2 million, as profitable underwriting results across its two core segments helped offset investment losses within the Solasglas portfolio.
Management reported a consolidated combined ratio of 90.5%, which was supported by a reduction in loss provisions related to the Middle East conflict and a period of limited catastrophe activity.
The company reported a divergence in top-line performance, with the open market segment contracting 10.4% to manage softening market conditions while the Innovations segment grew 46% through new treaties and organic expansion.
Capital management remained a central focus, as the company utilized $11.3 million for share repurchases during the third quarter and October, representing a significant portion of its year-to-date return of 5.4% of outstanding shares.
The company entered a strategic partnership with Hippo Holdings, providing Hippo the opportunity to co-invest in early-stage MGA investments alongside the Innovations unit.Management reported that Spinnaker Insurance Company will serve as the preferred U.S.
admitted fronting carrier for qualifying co-invested programs under the Hippo partnership.David Einhorn noted the addition of new long positions in Century Aluminum, ADI Global Distribution, and Canal+, a London-listed global pay TV and content production company.The Innovations segment is transitioning Syndicate 3456 to a full syndicate at Lloyd's, an initiative management expects will help accelerate profitable growth.Management reported that the macro SOFR future position was the largest detractor in the investment portfolio, though the company has reduced the position to manage risk.CEO Richardson stated that rates and terms remain attractive for the open market reinsurance business despite a softening environment, and the company expects "profitable new opportunities through next year." INDUSTRY GLOSSARY Combined Ratio: A measure of underwriting profitability calculated by dividing the sum of losses and expenses by earned premiums; a ratio below 100% indicates a profit.GWP: Gross Written Premium, the total amount of premium charged for all insurance policies issued by a company during a specific period.NWP: Net Written Premium, the amount of premium an insurer retains after paying for reinsurance coverage.Solasglas: The investment fund managed by Greenlight Capital that contains the majority of the company's investable assets.Innovations Segment: A business unit that provides investment capital and reinsurance capacity to technology-driven insurance companies and MGAs.MGA: Managing General Agent, an entity with underwriting authority from an insurer that manages a specific portion of its insurance business.Open Market Segment: The company's traditional reinsurance unit providing casualty, property, and specialty products through brokers.SOFR: Secured Overnight Financing Rate, a benchmark interest rate for dollar-denominated derivatives and loans.IBNR: Incurred But Not Reported, reserves for estimated losses that have occurred but have not yet been reported to the insurance company.
Full Conference Call Transcript Operator: Greetings.
Thank you for joining the Greenlight Capital Re Third Quarter 26 Earnings Conference Call.
At this time, participants are in a listen-only mode.
A question-and-answer session will follow the prepared comments.
You may press star 1 at any time to be placed in the question queue.
It is now my pleasure to turn the call over to David E.
Sigmon, Greenlight Re's general counsel.
You may begin.
Sigmon: Thank you, and good morning.
I would like to remind you that this conference call is being recorded and will be available for replay following the conclusion of the event.
An audio replay will also be available under the investors section of the company's website at www.greenlightre.com.
Joining us on the call today will be our CEO, Greg Richardson; Chairman of the board, David Einhorn, and our Chief Financial Officer, Faramarz Romer.
On behalf of the company, I would like to remind you that forward looking statements may be made during this call and are intended to be covered by the safe harbor provisions of the federal securities laws.
These forward looking statements reflect the company's current expectations estimates and predictions about future results and are subject to risks, uncertainties.
As a result,, actual results may differ materially from those expressed or implied.
For more information on the risks and other factors that may impact future performance, investors should review the periodic reports that are filed by the company with the SEC from time to time.
Additionally, management may refer to certain non GAAP financial measures.
The reconciliations to these measures can be found in the company's filings with the SEC.
The company undertakes no obligation to publicly update or revise any forward looking statements.
With that, it is now my pleasure to turn the call over to Greg.
Greg Richardson: Thank you, David.
Good morning, everyone, and thank you for joining us.
The third quarter of 26 was mixed with a strong underwriting result offset by investment losses.
Overall, we reported a net profit of $3.2 million which brings our year to date net income to $9.4 million.
Fully diluted book value per share increased 0.8% in the quarter to $20.78 per share.
We reported a combined ratio of 90.5% in the quarter.
Translating to $14.6 million of underwriting income.
This result was driven by a combination of the strong underlying profitability of the book assisted by a benign cat quarter.
Our open market book delivered an 87.9% combined ratio, while our innovations book delivered a 98.2% combined ratio.
Shifting to our top line.
Our open market gross written premium contracted 10.4% in the quarter compared to the prior year, as we respond to the softening market conditions and exercise prudent cycle management.
In contrast, our innovations book grew by 46% in the quarter reflecting stable pricing and strong organic growth of the companies we support in this segment.
During 2026, we have also expanded our use of outward reinsurance and third party capital, with overall gross written premium for the quarter down just 1.4% while net written premium was down 12.3%.
During our August earnings call, we noted a $25 million provision linked to the Middle East conflict.
This provision reduced by $6 million in the third quarter as more information became available on specific individual losses.
While the Middle East conflict is still ongoing, it is noteworthy that we have not reported any new large losses this quarter.
Our investment in the Solasglas portfolio was down 3.3% in the quarter.
David will provide more color on this in his remarks.
The Solasglas loss was offset by $10.5 million of other investment income.
Included in other investment income was $4.1 million of realized gains....
