Mount Logan Capital Inc. Reports Strong Third Quarter 2024 Results
Tuesday, Oct 22, 2024 7:26 pm ET
2min read Mount Logan Capital Inc. (CBOE: MLC) has announced its financial results for the third quarter ended September 30, 2024. The company, which focuses on alternative asset management and insurance solutions, reported robust performance across its asset management and insurance segments.
The asset management segment delivered a record quarter, with total revenue increasing by 13% year-over-year to $3.4 million. This growth was primarily driven by the increase in fees attributable to the Opportunistic Credit Interval Fund (SOFIX), CLO and sub-advisory fees, as well as the increase in Ovation management and incentive fees. The company's management fees associated with the assets of Ability Insurance Company also increased by 58% compared to the same period last year.
The insurance segment also performed exceptionally well, with total net investment income increasing by 10% to $23.5 million. This growth was driven by an increase in total insurance investment assets and improvements in yield across the investment portfolio. The yield on the insurance investment portfolio stood at 8.2% as of June 30, 2024, reflecting ongoing portfolio and capital optimization alongside the benefit of higher base rates.
Ability's total assets managed by Mount Logan increased to $636.2 million, up $198.9 million from the second quarter of 2023. The insurance segment's total investment assets also grew by 15% to $1.1 billion. The book value of the insurance segment increased by $48.6 million to $88.8 million, driven by higher insurance net income.
The insurance segment's Spread Related Earnings (SRE) for the trailing twelve months ended June 30, 2024, increased by 314% to $11.6 million. This growth was primarily driven by an increase in net investment income and lower operating expenses, partially offset by increased cost of funds. The reinsurance of additional Multi-Year Guaranteed Annuities (MYGA) during the quarter also contributed to the insurance segment's SRE growth.
The asset management segment's Fee Related Earnings (FRE) for the three months ended June 30, 2024, increased by 6.1% compared to the second quarter of 2023. FRE was $6.6 million for the trailing twelve months ended June 30, 2024, an increase of $0.7 million, or 12.2%, compared to the same period last year. This growth was primarily driven by revenue improvements and the roll-off of one-time expenses.
Mount Logan Capital Inc. declared a quarterly distribution of C$0.02 per common share in the third quarter of 2024, marking the twentieth consecutive quarter of a shareholder distribution. The company's strong performance across both segments demonstrates its ability to generate attractive returns for shareholders while maintaining a solid financial foundation.
In conclusion, Mount Logan Capital Inc. reported a strong third quarter in 2024, with robust performance across its asset management and insurance segments. The company's ability to generate attractive returns and maintain a solid financial foundation positions it well for continued growth and success in the future.
The asset management segment delivered a record quarter, with total revenue increasing by 13% year-over-year to $3.4 million. This growth was primarily driven by the increase in fees attributable to the Opportunistic Credit Interval Fund (SOFIX), CLO and sub-advisory fees, as well as the increase in Ovation management and incentive fees. The company's management fees associated with the assets of Ability Insurance Company also increased by 58% compared to the same period last year.
The insurance segment also performed exceptionally well, with total net investment income increasing by 10% to $23.5 million. This growth was driven by an increase in total insurance investment assets and improvements in yield across the investment portfolio. The yield on the insurance investment portfolio stood at 8.2% as of June 30, 2024, reflecting ongoing portfolio and capital optimization alongside the benefit of higher base rates.
Ability's total assets managed by Mount Logan increased to $636.2 million, up $198.9 million from the second quarter of 2023. The insurance segment's total investment assets also grew by 15% to $1.1 billion. The book value of the insurance segment increased by $48.6 million to $88.8 million, driven by higher insurance net income.
The insurance segment's Spread Related Earnings (SRE) for the trailing twelve months ended June 30, 2024, increased by 314% to $11.6 million. This growth was primarily driven by an increase in net investment income and lower operating expenses, partially offset by increased cost of funds. The reinsurance of additional Multi-Year Guaranteed Annuities (MYGA) during the quarter also contributed to the insurance segment's SRE growth.
The asset management segment's Fee Related Earnings (FRE) for the three months ended June 30, 2024, increased by 6.1% compared to the second quarter of 2023. FRE was $6.6 million for the trailing twelve months ended June 30, 2024, an increase of $0.7 million, or 12.2%, compared to the same period last year. This growth was primarily driven by revenue improvements and the roll-off of one-time expenses.
Mount Logan Capital Inc. declared a quarterly distribution of C$0.02 per common share in the third quarter of 2024, marking the twentieth consecutive quarter of a shareholder distribution. The company's strong performance across both segments demonstrates its ability to generate attractive returns for shareholders while maintaining a solid financial foundation.
In conclusion, Mount Logan Capital Inc. reported a strong third quarter in 2024, with robust performance across its asset management and insurance segments. The company's ability to generate attractive returns and maintain a solid financial foundation positions it well for continued growth and success in the future.
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