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Mar 31, 2023
AFG Q1 2023 Earnings Report
American Financial Group's first quarter 2023 results were announced, with net earnings per share of $2.49 and core net operating earnings per share of $2.89.
Key Takeaways
American Financial Group, Inc. reported a strong start to 2023 with a first quarter net earnings of $212 million ($2.49 per share) and core net operating earnings of $247 million ($2.89 per share). The company's annualized core operating return on equity was 22.0%. AFG had approximately $1.0 billion of excess capital at March 31, 2023.
Net earnings per share were $2.49, including a $0.40 per share loss from after-tax non-core items.
Core net operating earnings per share were $2.89.
Annualized ROE was 18.9%, with a core operating ROE of 22.0%.
Parent company cash and investments totaled approximately $672 million, with excess capital of $1.0 billion at March 31, 2023.
AFG
AFG
AFG Revenue by Segment
Revenue by Segment
Net Investment Income Revenue
CapyFin.comRealized Gains on Securities Revenue
CapyFin.comManaged Investment Entities: Investment Income Revenue
CapyFin.comManaged Investment Entities: Gains on FV Changes of Assets/Liabilities Revenue
CapyFin.com Forward Guidance
AFG expects core net operating earnings per share in 2023 to be in the range of $11.00 to $12.00, which would produce a core return on equity of over 20% at the midpoint. This guidance reflects an average crop year and a return of approximately 8% on alternative investments for the full-year 2023.
Positive Outlook
- Strong underwriting margins in Specialty P&C businesses.
- Improved investment income due to the higher interest rate environment.
- Continued strong performance of the alternative investment portfolio.
- Expects a core return on equity of over 20% at the midpoint.
- Anticipates a return of approximately 8% on alternative investments for the full year.
Challenges Ahead
- Guidance excludes non-core items such as realized gains and losses.
- Guidance reflects an average crop year.
- Underwriting profit decreased year-over-year due to lower returns in the alternative investment portfolio and lower underwriting profit in the Specialty P&C insurance operations.
- Alternative investment returns are expected to be lower than the previous year.
- Acquisition of Crop Risk Services is not expected to materially impact AFG’s reported results for 2023.
Revenue & Expenses
Visualization of income flow from segment revenue to net income