DALLAS, Nov. 5, 2025 /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 third quarter ended September 30, 2025.
Key Highlights - Third Quarter 2025 Financials
-- Total revenues were $17.4 million
-- Net premiums earned were $6.8 million
-- Net loss was $5.1 million
-- Program Services net fee income was $1.0 million
-- As of September 30, 2025, the Company's book value per common share was
$18.57
The Company reported earnings for the second time since closing its business combination agreement on May 27, 2025 between Kestrel and Maiden Holdings. The combination of values-driven insurance organizations with a commitment to innovation, client service and long-term relationships is intended to generate a balance sheet light, fee revenue model to deliver a strong fee-based insurance platform while selectively deploying underwriting capacity to optimize returns for shareholders. Kestrel's strategic focus centers on growing the fee income component of its program services business to increase profitability while effectively managing the continuing run-off of the legacy Maiden alternative asset and reinsurance portfolios.
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 ceding fees. Kestrel issues the policy through exclusive use of four insurance carriers, and the reinsurer assumes the risk.
In the third quarter of 2025, total fee revenues from the Program Services segment were $1.6 million, derived from fees from both new and existing client programs. Increased premium volume accounted for $1.1 million of fee revenue for the three months ended September 30, 2025. The Company continues to actively pursue reinsurance mechanisms with its existing partners that would selectively deploy the Company's underwriting capacity and facilitate and accelerate both its fee and premium revenue growth.
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 third quarter, the Legacy Reinsurance segment produced an underwriting loss of $9.0 million, of which $7.6 million related to that segment's AmTrust business. The AmTrust business reported approximately $6.9 million in adverse prior period loss development ("PPD"), of which $4.7 million related to AmTrust's Hospital Liability business as well as a reduction of $3.6 million in the amount recoverable under the Loss Portfolio Transfer and Adverse Development Cover Agreement ("LPT/ADC Agreement"). These amounts were offset by favorable development in Workers' Compensation and other lines of business. The segment's Diversified business produced an underwriting loss of $1.4 million resulting from favorable PPD of $0.3 million and higher expenses due to the run-off of various programs within that business.
Investment Activities and Other Gains
The Company also reported combined income from investment activities totaling $9.0 million for the three months ended September 30, 2025, resulting from net investment income of $3.5 million and realized and unrealized investment gains of $5.5 million, the latter of which was from Maiden's legacy alternative asset portfolio.
Also, during the third quarter, the Company recognized foreign exchange and other gains of $2.9 million for the three months ended September 30, 2025, primarily due to appreciation 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
General and administrative expenses in the third quarter of 2025 were $10.8 million, reflecting elevated levels of one-time costs such as transaction, insurance and legal fees, severance expenses and increased consulting fees. Through strategic cost management initiatives and the non-recurring nature of certain one-time items totaling $1.9 million during the third quarter, the Company believes general and administrative will trend lower in future quarters.
Balance Sheet
Total assets were $1.1 billion at September 30, 2025, and shareholders' equity was $143.8 million.
As of September 30, 2025, the Company has available net operating loss ("NOL") carryforwards of $446.6 million for income tax purposes. Approximately $365.3 million of NOL carryforwards expire in various years beginning in 2029. As of September 30, 2025, approximately $81.3 million or 18.2% of the Company's NOL carryforwards have no expiry date under the relevant U.S. tax 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.
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 prospectus filed pursuant to Rule 424(b) under the Securities Act of 1933, as amended, on March 10, 2025, and subsequent filings.
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, our ability to implement reinsurance mechanisms to selectively deploy underwriting capacity, changes in interest rates or other changes in the financial markets, the effects of emerging claim and coverage issues, changes in the demand for our products, 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 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.
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)
September 30, December 31,
2025 2024
------------------- ----------------------
(Unaudited) (Audited)
ASSETS
Investments:
Fixed maturities,
available-for-sale, at fair
value (Amortized cost 2025 -
$197,941) $ 198,658 $ --
Equity securities, at fair
value (Cost: 2025 -
$11,145) 11,350 --
Equity method investments 32,518 --
Other investments 171,791 --
------------------- ----------------------
Total investments 414,317 --
Cash and cash equivalents 12,890 4,286
Restricted cash and cash
equivalents 27,634 --
Accrued investment income 5,076 --
Reinsurance balances
receivable, net 9,706 --
Reinsurance recoverable on
unpaid losses 492,790 --
Net loan receivable from
related party 101,689 --
Intangible assets 10,370 --
Funds withheld receivable 11,941 --
Other assets 24,872 1,224
Assets held for sale 19,155 --
------------------- ----------------------
Total assets $ 1,130,440 $ 5,510
=================== ======================
LIABILITIES
Reserve for loss and loss
adjustment expenses $ 677,667 $ --
Unearned premiums 19,615 --
Liability for securities
purchased 11,692 --
Accrued expenses and other
liabilities 102,874 904
Senior notes - principal
amount 262,361 --
Less: unamortized fair value
adjustment 88,277 --
------------------- ----------------------
Senior notes, net 174,084 --
Liabilities held for sale 734 --
------------------- ----------------------
Total liabilities 986,666 904
------------------- ----------------------
Commitments and
Contingencies
EQUITY
Common shares 100 27
Additional paid-in capital 177,101 10,107
Accumulated other
comprehensive loss (916) --
Retained earnings
(accumulated deficit) 18,952 (5,528)
Treasury shares, at cost (51,463) --
Total Equity 143,774 4,606
------------------- ----------------------
Total Liabilities and Equity $ 1,130,440 $ 5,510
=================== ======================
Book value per common
share(1) $ 18.57 $ 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 For the Nine Months Ended
September 30, September 30,
---------------------------------
2025 2024 2025 2024
--------------- ---------------- ----------------- -------------- -----------------
Revenues:
Gross premiums
written $ 3,760 $ -- $ 4,856 $ --
---------------- ----------------- -------------- -----------------
Net premiums
written $ 3,895 $ -- $ 4,990 $ --
Change in
unearned
premiums 2,941 -- 4,268 --
---------------- ----------------- -------------- -----------------
Net premiums
earned 6,836 -- 9,258 --
Fee revenue 1,621 700 2,972 2,457
Net investment
income 3,494 52 5,059 170
Net realized and
unrealized
investment
gains 5,494 -- 6,552 --
Total revenues 17,445 752 23,841 2,627
---------------- ----------------- -------------- -----------------
Expenses:
Net loss and
loss adjustment
expenses 10,406 -- 4,445 --
Commission and
other
acquisition
expenses 1,718 -- 2,112 --
General and
administrative
expenses 10,783 1,181 17,006 3,980
---------------- ----------------- -------------- -----------------
Total expenses 22,907 1,181 23,563 3,980
---------------- ----------------- -------------- -----------------
Other expenses
Interest and
amortization
expenses 4,128 -- 5,647 --
Change in fair
value of earn
out liability (2,679) -- -- --
Gain on bargain
purchase -- -- (73,590) --
Foreign exchange
and other
(gains) losses (2,854) -- 2,155 --
---------------- ----------------- -------------- -----------------
Total other
expenses (1,405) -- (65,788) --
---------------- ----------------- -------------- -----------------
Net (loss)
income before
income taxes (4,057) (429) 66,066 (1,353)
Less: income tax
expense 7 -- 102 --
Interest in loss
of equity
method
investments (24) -- (24) --
---------------- ----------------- -------------- -----------------
Net (loss)
income from
continuing
operations (4,088) (429) 65,940 (1,353)
Loss from
discontinued
operations, net
of income tax (965) -- (1,460) --
---------------- ----------------- -------------- -----------------
Net (loss)
income $ (5,053) $ (429) $ 64,480 $ (1,353)
Basic and
diluted (loss)
earnings per
share from
continuing
operations $ (0.53) $ (0.16) $ 12.99 $ (0.49)
Basic and
diluted loss
per share from
discontinued
operations (0.12) -- (0.29) --
---------------- ----------------- -------------- -----------------
Basic and
diluted (loss)
earnings per
share
attributable to
Kestrel common
shareholders $ (0.65) $ (0.16) $ 12.70 $ (0.49)
Annualized
return on
average common
equity (13.6) % (36.3) % 116.2 % (35.0) %
Weighted average
number of
common shares -
basic and
diluted 7,741,943 2,749,996 5,053,828 2,749,996
KESTREL GROUP LTD
SUPPLEMENTAL FINANCIAL DATA - SEGMENT INFORMATION (Unaudited)
(In thousands of U.S. dollars)
-------------------------------------------------------------------------------------
For the Three
Months Ended
September 30, Legacy Program
2025 Reinsurance Services Total
----------------- --------------------- --------------------- -------------------
Gross premiums
written $ 3,760 $ -- $ 3,760
===================== ===================== ===================
Net premiums
written $ 3,895 $ -- $ 3,895
===================== ===================== ===================
Net premiums
earned $ 6,836 $ -- $ 6,836
Fee revenue -- 1,621 1,621
Net loss and loss
adjustment
expenses ("loss
and LAE") (10,406) -- (10,406)
Commission and
other acquisition
expenses (1,718) -- (1,718)
General and
administrative
expenses(2) (3,689) (664) (4,353)
--------------------- --------------------- -------------------
Underwriting loss
and fee
income(3) $ (8,977) $ 957 (8,020)
===================== =====================
Reconciliation to
net loss from
continuing
operations
Net investment
income and net
realized and
unrealized
investment gains 8,988
Interest and
amortization
expenses (4,128)
Change in fair
value of earn out
liability 2,679
Foreign exchange
and other gains,
net 2,854
Other general and
administrative
expenses(2) (6,430)
Income tax expense (7)
Interest in loss
of equity method
investments (24)
-------------------
Net loss from
continuing
operations $ (4,088)
===================
For the Three
Months Ended
September 30, Legacy Program
2024 Reinsurance Services Total
Fee revenue $ -- $ 700 $ 700
General and
administrative
expenses(2) -- (590) (590)
--------------------- --------------------- -------------------
Fee income(4) $ -- $ 110 110
===================== =====================
Reconciliation to
net loss
Net investment
income 52
Other general and
administrative
expenses(2) (591)
Net loss $ (429)
===================
KESTREL GROUP LTD
SUPPLEMENTAL FINANCIAL DATA - SEGMENT INFORMATION (Unaudited)
(In thousands of U.S. dollars)
For the Nine
Months Ended
September 30, Legacy Program
2025 Reinsurance Services Total
--------------- --------------------- --------------------- ---------------
Gross premiums
written $ 4,856 $ -- $ 4,856
===================== --------------------- ---------------
Net premiums
written $ 4,990 $ -- $ 4,990
===================== --------------------- ---------------
Net premiums
earned $ 9,258 $ -- $ 9,258
Fee revenue -- 2,972 2,972
Net loss and LAE (4,445) -- (4,445)
Commission and
other
acquisition
expenses (2,112) -- (2,112)
General and
administrative
expenses(2) (5,432) (2,003) (7,435)
--------------------- --------------------- ---------------
Underwriting
loss and fee
income(3) $ (2,731) $ 969 (1,762)
===================== =====================
Reconciliation
to net income
from continuing
operations
Net investment
income and net
realized and
unrealized
investment
gains 11,611
Interest and
amortization
expenses (5,647)
Gain on bargain
purchase 73,590
Foreign exchange
and other
losses, net (2,155)
Other general
and
administrative
expenses(2) (9,571)
Income tax
expense (102)
Interest in loss
from equity
method
investments (24)
---------------
Net income from
continuing
operations $ 65,940
===============
For the Nine
Months Ended
September 30, Legacy Program
2024 Reinsurance Services Total
Fee revenue $ -- $ 2,457 $ 2,457
General and
administrative
expenses(2) -- (1,990) (1,990)
--------------------- --------------------- ---------------
Fee income $ -- $ 467 467
===================== =====================
Reconciliation
to net loss
Net investment
income 170
Other general
and
administrative
expenses(2) (1,990)
Net loss $ (1,353)
===============
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 For the Nine Months Ended
September 30, September 30,
----------------------------------
2025 2024 2025 2024
----------------- ----------------- ---------------- ---------------- ----------------
Non-GAAP operating
loss (4) $ (15,091) $ (429) $ (12,023) $ (1,353)
================= ================ ================ ================
Non-GAAP basic and
diluted operating
loss per common
share
attributable to
Kestrel common
shareholders(4) $ (1.95) $ (0.16) $ (2.38) $ (0.49)
================= ================ ================ ================
Annualized
non-GAAP
operating return
on average
adjusted common
equity(5) (40.7) % (36.3) % (21.7) % (35.0) %
================= ================ ================ ================
Reconciliation of
net loss to
non-GAAP
operating loss:
Net (loss) income $ (5,053) $ (429) $ 64,480 $ (1,353)
Add (subtract):
Net realized and
unrealized
investment gains (5,494) -- (6,552) --
Foreign exchange
and other (gains)
losses (2,854) -- 2,155 --
Interest in loss
of equity method
investments 24 -- 24 --
Bargain purchase
gain -- -- (73,590) --
Net loss from
discontinued
operations 965 -- 1,460 --
Change in fair
value of earn out
consideration (2,679) -- -- --
----------------- ---------------- ---------------- ----------------
Non-GAAP operating
loss (4) $ (15,091) $ (429) $ (12,023) $ (1,353)
================= ================ ================ ================
Weighted average
number of common
shares - basic
and diluted 7,741,943 2,749,996 5,053,828 2,749,996
Reconciliation of diluted (loss) earnings per share
attributable to Kestrel common shareholders to non-GAAP
diluted operating loss per share attributable to
Kestrel common shareholders:
Diluted (loss)
earnings per
share
attributable to
common
shareholders $ (0.65) $ (0.16) $ 12.70 $ (0.49)
Add (subtract):
Net realized and
unrealized
investment gains (0.71) -- (1.29) --
Foreign exchange
and other (gains)
losses (0.37) -- 0.44 --
Interest in loss
of equity method
investments -- -- 0.01 --
Bargain purchase
gain -- -- (14.54) --
Net loss from
discontinued
operations 0.13 -- 0.30 --
Change in fair
value of earn out
consideration (0.35) -- -- --
----------------- ---------------- ---------------- ----------------
Non-GAAP diluted
operating loss
per share
attributable to
common
shareholders(4) $ (1.95) $ (0.16) $ (2.38) $ (0.49)
================= ================ ================ ================
KESTREL GROUP LTD
NON-GAAP FINANCIAL MEASURES (Unaudited)
(In thousands of U.S. dollars, except share and per share data)
September 30, December 31,
2025 2024
----------------- ----------------------
Investable assets:
Total investments $ 414,317 $ --
Cash and cash equivalents 12,890 4,286
Restricted cash and cash
equivalents 27,634 --
Net loan receivable from related
party 101,689 --
Funds withheld receivable 11,941 --
----------------- ----------------------
Total investable assets(6) $ 568,471 $ 4,286
================= ======================
Capital:
Total shareholders' equity $ 143,774 $ 4,606
2016 Senior Notes 110,000 --
2013 Senior Notes 152,361 --
----------------- ----------------------
Total capital resources(7) $ 406,135 $ 4,606
================= ======================
(1) 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.
(2) 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).
(3) 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.
(4) 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 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 Agreement; and (3) the change in
the fair value of the earn out liability. 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.
(5) 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.
(6) Investable assets are the total of the Company's investments, cash and
cash equivalents, net loan receivable from related party and funds withheld
receivable.
(7) Total capital resources are the sum of the Company's principal amount of
debt and shareholders' equity.
View original content:https://www.prnewswire.com/news-releases/kestrel-group-reports-third-quarter-2025-financial-results-302606106.html
SOURCE Kestrel Group Ltd
(END) Dow Jones Newswires
November 05, 2025 16:15 ET (21:15 GMT)