Essent Group (ESNT) Q4 2025 Earnings Transcript

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Friday, February 13, 2026 astatine 10 a.m. ET

• Chairman and Chief Executive Officer — Mark Casale

• Chief Financial Officer — David Weinstock

• Chief Operating Officer — Philip Stefano

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Mark. Philip, and bully morning, everyone. Earlier today, we released our fiscal results for the 4th fourth and afloat twelvemonth of 2025. Our beardown show this twelvemonth was driven by affirmative recognition trends, and the payment of higher involvement rates connected some persistency and concern income. These results show the spot of our buy, manage, and administer operating exemplary successful generating high-quality earnings, which has enabled america to instrumentality a much strategical attack to superior management. For 2025, we reported nett income of $155 cardinal oregon $1.60 per diluted share. For the afloat year, we earned $690 cardinal oregon $6.90 per diluted stock portion generating a instrumentality connected mean equity of 12%.

As of December 31, our publication worth per stock was $60.31, an summation of 13% from a twelvemonth ago. As of December 31, our owe security successful unit was $248 billion, a 2% summation versus a twelvemonth ago. Our twelve-month persistency connected December 31 was 86%, with astir 60% of our in-force portfolio having a enactment complaint of 6% oregon lower. Over the past respective quarters, persistency has been comparatively level reflecting higher owe rates and a smaller origination market. As a result, we judge that implicit the adjacent term, earned premium and security successful unit maturation volition beryllium modest.

The recognition prime of our security successful unit remains strong, with a weighted mean FICO of 747 and a weighted mean archetypal LTV of 93%. Our portfolio default complaint accrued modestly 4th implicit 4th reflecting mean seasonality and the continued aging of our security successful force. Looking forward, we judge that the important location equity embedded successful our in-force publication should mitigate eventual claims. Outward reinsurance continues to play an integral relation successful operating our business. At 2025, 98% of our owe security portfolio was taxable to immoderate signifier of reinsurance. During 2025, we entered into a quota stock with a sheet of highly rated reinsurers providing guardant extortion for our 2027 business.

We stay pleased with the execution of our reinsurance strategy, ceding a meaningful information of our mezzanine recognition hazard and diversifying our superior resources. On the Bermuda front, Essent Re continues to beryllium a precise effectual level successful deploying superior and generating further net for Essent. For 2025, Essent Re earned astir $80 cardinal successful third-party nett income portion ending the twelvemonth with $2.3 cardinal successful risk. In addition, during the 4th quarter, Essent Re entered into quota stock reinsurance agreements backed by funds astatine Lloyd’s to reinsure definite spot and casualty risks.