Octave Specialty Group Inc (OSG)

Octave Specialty Group Reports First Quarter 2026 ResultsMay 6, 2026 4:35 PM
Business Wire Total P&C premium production increased 66% for the quarter to $531 million Insurance Distribution Segment Total revenue grew 92% to $79 million, including the impact of the October 2025 acquisition of ArmadaCare Organic revenue growth equaled 42% Net income to Shareholders of $13 million, compared to net loss of $(3) million in 1Q25 Adjusted EBITDA to Shareholders of $25 million, compared to $7 million in 1Q25 Pre-tax income and Adjusted EBITDA margin to shareholders reached 16% and 32%, respectively Specialty P&C Insurance Segment ("Everspan") Gross and net premiums written of $104 million and $32 million were up 19% and 80%, respectively Net loss was $(8) million, compared to net income of $1 million in 1Q25 The first quarter 2026 net loss was driven primarily by losses and LAE from the settlement of a potential litigation matter related to an insurance claim Adjusted net income was $1.2 million, compared to Adjusted net income of $1.5 million a year ago Adjusted EBITDA to Shareholders of $1.6 million, up 2% compared to 1Q25   Octave Specialty Group, Inc. (NYSE: OSG) ("Octave" or "OSG"), a global specialty insurance firm, today reported its results for the First Quarter 2026. "I am very pleased with our first quarter results," said Claude LeBlanc, President and Chief Executive Officer of Octave. "Our core Insurance Distribution business delivered 92% revenue growth, 42% organic growth, the rest from our recent ArmadaCare acquisition. Insurance Distribution Adjusted EBITDA increased to $25 million, nearly four times the same period last year. The diversification of our distribution platform demonstrated the resilience and value of the Octave platform as we delivered our strongest quarter yet, even as we witnessed some headwinds in certain segments of the market." LeBlanc continued, “Everspan's turnaround is also gaining momentum. Gross premiums written topped $100 million, up 19%, while net premiums written grew 80%. Regrettably, we experienced some adverse development this quarter from the settlement of a potential litigation matter related to an insurance claim from a program in run-off. This loss was primarily attributable to legal expenses incurred in connection with the settlement which had an adverse impact on our reported quarterly underwriting results. Importantly however, our active programs were running at a loss ratio of 57% in the first quarter, right in line with the current accident year performance." LeBlanc concluded, "Overall, this quarter's results reflect solid execution and reinforces our confidence in the strength of our business." Octave's First Quarter 2026 Summary Results     Three Months Ended March 31, (in thousands, except per share data)1     2026       2025     % Change Total revenues from continuing operations   $ 104,170     $ 62,756     66 % Total expenses from continuing operations   $ 107,514     $ 77,863     38 % Pretax income (loss) from continuing operations   $ (3,344 )   $ (15,107 )   (78 )% Provision (benefit) for income taxes from continuing operations   $ (481 )   $ (617 )   NM   Net income (loss) from continuing operations   $ (2,863 )   $ (14,490 )   (80 )% Net income (loss) from continuing operations attributable to shareholders, net of tax   $ (6,851 )   $ (16,144 )   (58 )% Net income (loss) from discontinued operations   $ —     $ (30,247 )   NM   Net income (loss) attributable to shareholders   $ (6,851 )   $ (46,391 )   NM   Net income (loss) from continuing operations attributable to stockholders per diluted share 3   $ (0.13 )   $ (0.57 )   (77 )% Net income (loss) attributable to stockholders per diluted share 3   $ (0.13 )   $ (1.21 )   (89 )% Non-GAAP             EBITDA to shareholders 2   $ 3,610     $ (5,477 )   (166 )% Adjusted EBITDA to shareholders2   $ 20,069     $ (1,287 )   NM   Adjusted net income (loss) attributable to shareholders   $ 16,615     $ (6,037 )   (375 )% Per Share             Adjusted net income (loss) to shareholders per diluted share 2   $ 0.37     $ (0.13 )   (385 )% Adjusted EBITDA to shareholders per diluted share2   $ 0.44     $ (0.03 )   NM                 Weighted-average diluted shares outstanding     45,303       47,313     (4 )% (1) Some financial data in this press release may not add up due to rounding (2) See Non-GAAP Financial Data section of this press release for further information (3) Per diluted share includes the impact of adjusting redeemable noncontrolling interests to current redemption value First Quarter 2026 Summary(4) Total revenue from continuing operations for the first quarter of 2026 was $104 million, an increase of 66% compared to the $63 million in the same prior-year period. The growth in total revenue was driven by the Insurance Distribution segment, which included the acquisition of ArmadaCare and organic revenue growth of 42%. Net (loss) from continuing operations to shareholders for the first quarter of 2026 was $(7) million compared to $(16) million in the same prior-year period. The improvement was attributable to our Insurance Distribution segment, which reported net income of $13 million compared to a net loss of $(3) million in the prior year quarter. The strong results in the Insurance Distribution business were partially offset by a net loss of $(8) million in our Specialty Property & Casualty segment, which included $2.1 million of losses and $5.8 million of LAE (legal expenses) to settle a potential litigation matter related to an insurance claim. Adjusted net income to shareholders, which excludes non-recurring expenses along with other items, was $17 million compared to a net loss of $(6) million in the same prior-year period. Adjusted EBITDA from continuing operations to shareholders for the first quarter of 2026 was $20.1 million compared to $(1.3) million in the same prior-year period. The improvement was driven by an $18.2 million increase in Insurance Distribution Adjusted EBITDA. Our Insurance Distribution results reflected the first full quarter of ArmadaCare and the seasonal impact of our A&H business, in addition to growth across our core MGA platform. Everspan reported an Adjusted EBITDA of $1.6 million, up 2% from the prior-year period. Included within first quarter 2026 results was a Corporate net (loss) of $(12) million compared to a net (loss) of $(14) million in the first quarter of 2025. Corporate Adjusted EBITDA was a (loss) of $(7) million compared to a loss of $(10) million in the first quarter of 2025. (4) For definitions of each non-GAAP measure referred to above, as well as reconciliation of such non-GAAP measures to their most directly comparable GAAP measures, see "Non-GAAP Financial Measures" below. Earnings Call and Webcast On May 7, 2026, at 8:30am ET, Claude LeBlanc, President and Chief Executive Officer, and David Trick, Executive Vice President and Chief Financial Officer, will discuss Octave's first quarter 2026 results during a conference call. A live audio webcast of the call will be available through the Investor Relations section of Octave’s website, https://octavegroup.com/investor-relations/events-and-presentations/. Participants may also listen via telephone by dialing (877) 407-9716 or (201) 493-6779. The webcast will be archived on Octave's website. A replay of the call will be available through May 21, 2026, and can be accessed by dialing (Domestic) (844) 512-2921 or (International) (412) 317-6671; and using ID# 13759400. Additional information is included in an operating supplement and presentations on Octave's website, www.octavegroup.com. Results of Operations by Segment Insurance Distribution Segment     Three Months Ended March 31, ($ in thousands)     2026       2025     % Change Premiums placed   $ 426,833     $ 233,186     83 % Total revenues   $ 78,526     $ 40,998     92 % Pretax income (loss)   $ 16,785     $ (2,243 )   (848 )% Pretax income (loss) to shareholders1   $ 12,797     $ (3,897 )   (428 )% Net income (loss)   $ 17,153     $ (1,743 )   (1084 )% Net income (loss) to shareholders1   $ 13,165     $ (3,397 )   (488 )% EBITDA   $ 30,817     $ 12,083     155 % EBITDA to shareholders1   $ 23,467     $ 7,083     231 % Adjusted EBITDA   $ 32,995     $ 12,112     172 % Adjusted EBITDA to shareholders1   $ 25,340     $ 7,112     256 % Adjusted net income (loss)   $ 28,749     $ 7,049     308 % Adjusted net income (loss) to shareholders   $ 22,045     $ 2,549     765 % Pretax income margin to shareholders2     16.3 %     (9.5 )%   2580 bps Adjusted EBITDA margin to shareholders3,4     32.3 %     17.3 %   1500 bps Organic Growth     41.8 %     (2.1 )%     (1) After the impact of noncontrolling interests
(2) Represents Pretax income (loss) to shareholders divided by total revenues
(3) See Non-GAAP Financial Data section of this press release for further information
(4) Represents Adjusted EBITDA to shareholders divided by total revenues Specialty Property & Casualty Insurance Segment     Three Months Ended March 31, ($ in thousands)     2026       2025     % Change Gross premium written   $ 103,716     $ 86,915     19 % Net premiums written   $ 32,449     $ 18,004     80 % Net premiums earned   $ 20,001     $ 15,678     28 % Total revenue   $ 25,299     $ 21,171     19 % Net income (loss)   $ (7,690 )   $ 1,425     (640 )% Adjusted EBITDA to shareholders(1)   $ 1,618     $ 1,589     2 % Loss Ratio     98.4 %     66.9 %   3150 bps Expense Ratio     51.3 %     35.2 %   1610 bps Combined Ratio     149.7 %     102.1 %   4760 bps (1) See Non-GAAP Financial Data section of this press release for further information OSG Corporate (holding company only) OSG on a standalone basis, excluding its ownership interests in its Specialty P&C Insurance and Insurance Distribution subsidiaries, had net assets of $61 million as of March 31, 2026. Assets included cash and liquid securities of $39 million and other investments of $22 million. Consolidated Octave Specialty Group, Inc. Stockholders' Equity and NCI Impact to EPS Stockholders’ equity attributable to common shareholders at March 31, 2026, was $713 million, or $15.83 per share compared to $716 million or $15.90 per share as of December 31, 2025. The decline was primarily a result of the total comprehensive loss attributable to common shareholders of $(14) million, partially offset by increased additional paid-in capital of $10 million related to changes in noncontrolling interest and stock compensation. Calculation of Earnings (Loss) Per Share (EPS) Diluted net income (loss) per share is computed by dividing net income (loss) attributable to shareholders, including adjustments to the redemption value of redeemable noncontrolling interests, by the basic weighted-average shares outstanding plus all potentially dilutive common shares outstanding during the period. The following table provides a reconciliation of net income (loss) attributable to shareholders to the numerator in the diluted earnings per share calculation, together with the resulting earnings per share amounts:   Three Months Ended March 31, (in thousands, except per share data)   2026       2025   Net income (loss) from continuing operations attributable to shareholders $ (6,851 )   $ (16,144 ) Adjustment for Redeemable NCI   807       (10,825 ) Numerator of diluted EPS $ (6,044 )   $ (26,969 ) Per Share — Diluted $ (0.13 )   $ (0.57 )         Net income (loss) attributable to shareholders $ (6,851 )   $ (46,391 ) Adjustment for Redeemable NCI   807       (10,825 ) Numerator of diluted EPS $ (6,044 )   $ (57,216 ) Per Share — Diluted $ (0.13 )   $ (1.21 )         WASO-Diluted   45,303       47,313   OCTAVE SPECIALTY GROUP, INC. AND SUBSIDIARIES Consolidated Statements of Income (Loss) (Unaudited)     Three Months Ended March 31, ($ in thousands, except share data)     2026       2025   Revenues:         Commissions   $ 68,178     $ 36,771   Servicing and other fees     9,362       4,964   Net premiums earned     20,001       15,678   Program fees     3,644       3,652   Investment income     2,355       2,815   Other     630       (1,124 ) Total revenues     104,170       62,756   Expenses:         Commissions     14,005       10,365   Losses and loss adjustment expenses     19,679       10,496   Policy acquisition costs     6,371       3,841   General and administrative     53,155       38,531   Intangible amortization and depreciation     12,214       9,176   Interest     2,090       5,454   Total expenses     107,514       77,863   Pretax income (loss) from continuing operations     (3,344 )     (15,107 ) Provision (benefit) for income taxes from continuing operations     (481 )     (617 ) Net income (loss) from continuing operations     (2,863 )     (14,490 ) Net income (loss) from discontinued operations     —       (30,247 ) Net income (loss)     (2,863 )     (44,737 ) Net (gain) loss attributable to noncontrolling interest     (3,988 )     (1,654 ) Net income (loss) attributable to shareholders   $ (6,851 )   $ (46,391 )           Net income (loss) from continuing operations attributable to stockholders   $ (6,851 )   $ (16,144 ) Net income (loss) from discontinued operations attributable to stockholders     —       (30,247 ) Net income (loss) attributable to shareholders   $ (6,851 )   $ (46,391 )           Net income (loss) from continuing operations per share attributable to stockholders         Basic   $ (0.13 )   $ (0.57 ) Diluted   $ (0.13 )   $ (0.57 )           Net income (loss) per share attributable to stockholders         Basic   $ (0.13 )   $ (1.21 ) Diluted   $ (0.13 )   $ (1.21 )           Weighted-average number of common shares outstanding:         Basic     45,302,933       47,313,012   Diluted     45,302,933       47,313,012   OCTAVE SPECIALTY GROUP, INC. AND SUBSIDIARIES Consolidated Balance Sheets ($ in thousands, except share data)   March 31,
2026   December 31,
2025     (Unaudited)     Assets:         Investments:         Fixed maturity securities, at fair value (amortized cost: $139,242 and $123,414)   $ 137,092     $ 122,295   Short-term investments, at fair value (amortized cost: $92,295 and $146,434)     92,295       146,442   Other investments (includes $7,454 and $7,454 at fair value)     24,971       24,971   Total investments (net of allowance for credit losses of $0 and $0)     254,358       293,708   Cash and cash equivalents (including $46,634 and $40,754 of restricted cash)     93,537       68,440   Premium receivables (net of allowance for credit losses of $500 and $500)     87,653       75,085   Commission and fees receivable     106,198       86,549   Reinsurance recoverable on paid and unpaid losses (net of allowance for credit losses of $100 and $100)     469,859       436,092   Deferred ceded premium     145,420       146,365   Policy acquisition costs     16,451       9,732   Intangible assets, less accumulated amortization     458,380       474,998   Goodwill     533,497       540,345   Other assets (net of allowance for credit losses of $350 and $350)     101,673       92,003   Total assets   $ 2,267,026     $ 2,223,317   Liabilities and Stockholders’ Equity:         Liabilities:         Unearned premiums   $ 198,681     $ 187,178   Loss and loss adjustment expense reserves     487,261       459,990   Ceded premiums payable     89,148       80,561   Deferred program fees and reinsurance commissions     6,929       6,978   Commission payable     118,086       115,555   Deferred taxes     60,553       65,217   Long-term debt     117,062       117,558   Accrued interest payable     1,305       1,343   Other liabilities     158,458       102,771   Total liabilities     1,237,483       1,137,151   Redeemable noncontrolling interest     195,969       252,981   Stockholders’ equity:         Preferred stock, par value $0.01 per share; 20,000,000 shares authorized shares; issued and outstanding shares—none     —       —   Common stock, par value $0.01 per share; 130,000,000 shares authorized; issued shares: 48,876,882 and 48,876,882     489       489   Additional paid-in capital     380,263       369,860   Accumulated other comprehensive income     1,224       8,483   Retained earnings     363,751       370,431   Treasury stock, shares at cost: 3,863,290 and 3,871,598     (33,109 )     (33,473 ) Total Octave Specialty Group, Inc. stockholders’ equity     712,618       715,790   Nonredeemable noncontrolling interest     120,956       117,395   Total stockholders’ equity     833,574       833,185   Total liabilities, redeemable noncontrolling interest and stockholders’ equity   $ 2,267,026     $ 2,223,317   Non-GAAP Financial Data In addition to reporting the Company’s quarterly financial results in accordance with GAAP, the Company is reporting non-GAAP financial measures: EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin, Organic Revenue Growth Rate (Insurance Distribution segment only), Adjusted Net Income and Adjusted Net Income Margin. These amounts are derived from our consolidated financial information, but are not presented in our consolidated financial results because they are not calculated in accordance with GAAP. We present non-GAAP supplemental financial information because we believe such information is of interest to the investment community, and that it provides greater transparency and enhanced visibility into the underlying drivers and performance of our businesses on a basis that may not be otherwise apparent on a GAAP basis. We view these non-GAAP financial measures as important indicators when assessing and evaluating our performance on a segmented and consolidated basis, and they are presented to improve the comparability of our results between periods by eliminating the impact of the items that may not be representative of our core operating performance. These non-GAAP financial measures are not substitutes for the Company’s GAAP reporting, should not be viewed in isolation, and may differ from similar reporting provided by other companies, which may define non-GAAP measures differently The following paragraphs define each non-GAAP financial measure. A tabular reconciliation of the non-GAAP financial measure to the most comparable GAAP financial measure is also presented below. Non-GAAP Financial Measures Organic Revenue Growth & Rate (Insurance Distribution Only) — Organic revenue is based on commissions and fees for the relevant period by excluding (i) the first twelve months of commissions and fees generated from acquisitions, (ii) commissions and fees from divestitures and (iii) other items such as contingent commissions, profit commissions and the impact of changes in foreign exchange rates. Organic Revenue Growth is the change in organic revenue period-to-period, with prior period results adjusted to (i) include commissions and fees that were excluded from organic revenue in the prior period and reached the twelve-month owned mark in the current period, and (ii) exclude commissions and fees related to divestitures from organic revenue. Total Specialty P&C Insurance Production includes gross premiums written by Octave's Specialty P&C Insurance segment and premiums placed by the Insurance Distribution segment. Specialty P&C Insurance revenues are dependent on gross premiums written, as specialty program insurance companies earn premiums based on the portion of gross premiums written retained (i.e., net premiums written) and fees on gross premiums written that are ceded to reinsurers. Insurance Distribution revenues are dependent on premium volume, as Managing General Agents/Underwriters and brokers receive commissions based on the amount of premiums placed (i.e., gross premiums written on behalf of insurance carriers) with insurance carriers. EBITDA — EBITDA is net income (loss) from continuing operations before interest expense, income taxes, depreciation and amortization of intangible assets. EBITDA Margin — EBITDA divided by total revenues. Adjusted EBITDA and Adjusted EBITDA Margin — We define Adjusted EBITDA as net income (loss) from continuing operations before interest expense, income taxes, depreciation, amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration-related expenses, severance, and other exceptional or non-recurring items, including those related to raising capital. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance, and that the presentation of this measure enhances an investor's understanding of our financial performance. Adjusted Net Income and Adjusted Net Income Margin — We define Adjusted Net Income as net income (loss) from continuing operations attributable to Octave adjusted for amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration-related expenses, severance and non-recurring income and loss items that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. Per share amounts exclude any impact of revaluing noncontrolling interests as otherwise reported under GAAP earnings per share. We believe that Adjusted Net Income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance. Results of Operations by Segment (Continued) Three Months Ended March 31, 2026   Specialty Property & Casualty Insurance   Insurance Distribution   Corporate & Other   Consolidated ($ in thousands)                 Gross premiums written   $ 103,716             $ 103,716   Net premiums written     32,449               32,449   Total revenues     25,299       78,526       345       104,170   Total expenses     33,581       61,741       12,192       107,514   Pretax income (loss)     (8,282 )     16,785       (11,847 )     (3,344 ) Provision (benefit) for income taxes     (592 )     (368 )     479       (481 ) Net income (loss)   $ (7,690 )   $ 17,153     $ (12,326 )   $ (2,863 )                   Adjustments to EBITDA                 Add: Interest expense       $ 2,090         $ 2,090   Add: Income tax expense     (592 )     (368 )     479       (481 ) Add: Depreciation     —       295       272       567   Add: Intangible amortization         11,647           11,647   EBITDA   $ (8,282 )   $ 30,817     $ (11,575 )   $ 10,960   EBITDA attributable to shareholders   $ (8,282 )   $ 23,467     $ (11,575 )   $ 3,610                     Adjustments to Adjusted EBITDA                 Add: Acquisition and integration-related expenses   $ —     $ 1,404     $ 1,064     $ 2,468   Add: Equity-based compensation expense     697       774       3,121       4,592   Add: Change in fair value of contingent considerations     —       —       —       —   Add: Restructuring related expense     —       —       —       —   Add: Severance and restructuring expense     1,291       —       419       1,710   Add: Other non-operating (income) losses     7,912       —       82       7,994   Adjusted EBITDA   $ 1,618     $ 32,995     $ (6,889 )   $ 27,724   Adjusted EBITDA attributable to shareholders   $ 1,618     $ 25,340     $ (6,889 )   $ 20,069                     Net income (loss)   $ (7,690 )   $ 17,153     $ (12,326 )   $ (2,863 ) Adjustments:                 Add: Acquisition and integration-related expenses     —       1,404       1,064       2,468   Add: Intangible amortization     —       11,647       —       11,647   Add: Equity-based compensation expense     697       774       3,121       4,592   Add: Severance and restructuring expense     1,291       —       419       1,710   Add: Other non-operating (income) losses     7,912       —       82       7,994   Adjusted net income (loss) before tax and NCI     2,210       30,978       (7,640 )     25,548   Income tax effects     (1,055 )     (2,229 )     1,055       (2,229 ) Adjusted net income (loss) before NCI     1,155       28,749       (6,585 )     23,319   Net (income) loss attributable to noncontrolling interest     —       (6,704 )     —       (6,704 ) Adjusted net income (loss) attributable to shareholders   $ 1,155     $ 22,045     $ (6,585 )   $ 16,615                     Net income (loss) margin     (30.4 )%     21.8 %     NM       (2.7 )% Adjusted EBITDA Margin     6.4 %     42.0 %     NM       26.6 % Adjusted EBITDA Margin to shareholders     6.4 %     32.3 %     NM       19.3 % Adjusted net income (loss) after NCI margin     4.6 %     28.1 %     NM       15.9 % Three Months Ended March 31, 2025   Specialty Property & Casualty Insurance   Insurance Distribution   Corporate & Other   Consolidated ($ in thousands)                 Gross premiums written   $ 86,915             $ 86,915   Net premiums written     18,004               18,004   Total revenues from Continuing Operations     21,171       40,998       587       62,756   Total expenses from Continuing Operations     19,668       43,241       14,954       77,863   Pretax income (loss)     1,503       (2,243 )     (14,367 )     (15,107 ) Provision (benefit) for income taxes     78       (500 )     (195 )     (617 ) Net income (loss) from Continuing Operations   $ 1,425     $ (1,743 )   $ (14,172 )   $ (14,490 )                   Adjustments to EBITDA                 Add: Interest expense   $ —     $ 5,454     $ —     $ 5,454   Add: Income tax expense     78       (500 )     (195 )     (617 ) Add: Depreciation     —       109       304       413   Add: Intangible amortization     —       8,763       —       8,763   EBITDA from Continuing Operations     1,503       12,083       (14,063 )     (477 ) EBITDA from Continuing Operations attributable to shareholders   $ 1,503     $ 7,083     $ (14,063 )   $ (5,477 )                   Adjustments to Adjusted EBITDA                 Add: Acquisition and integration-related expenses   $ —     $ —     $ 682     $ 682   Add: Equity-based compensation expense     86       —       1,574       1,660   Add: Severance and restructuring expense     —       29       1,819       1,848   Add: Other non-operating (income) losses     —       —       —       —   Adjusted EBITDA     1,589       12,112       (9,988 )     3,713   Adjusted EBITDA to attributable to shareholders   $ 1,589     $ 7,112     $ (9,988 )   $ (1,287 )                   Net income (loss) (Continuing Operations)   $ 1,425     $ (1,743 )   $ (14,172 )   $ (14,490 ) Adjustments:                 Add: Acquisition and integration-related expenses     —       —       682       682   Add: Intangible amortization     —       8,763       —       8,763   Add: Equity-based compensation expense     86       —       1,574       1,660   Add: Severance and restructuring expense     —       29       1,819       1,848   Add: Other non-operating (income) losses     —       —       —       —   Adjusted net income (loss) before tax and NCI     1,511       7,049       (10,097 )     (1,537 ) Income tax effects     —       —       —       —   Adjusted net income (loss) before NCI     1,511       7,049       (10,097 )     (1,537 ) Net (income) loss attributable to noncontrolling interest     —       (4,500 )     —       (4,500 ) Adjusted net income (loss) attributable to shareholders   $ 1,511     $ 2,549     $ (10,097 )   $ (6,037 )                   Net income (loss) margin     6.7 %     (4.3 )%     NM       (23.1 )% Adjusted EBITDA Margin     7.5 %     29.5 %     NM       5.9 % Adjusted EBITDA Margin to shareholders     7.5 %     17.3 %     NM       (2.1 )% Adjusted net income (loss) after NCI margin     7.1 %     6.2 %     NM       (9.6 )%                   Organic Growth     Three Months Ended March 31, ($ in thousands)     2026       2025     % Growth Total Insurance Distribution revenue (1) $ 78,526     $ 40,998     91.5 % Less: Acquired revenues   (21,121 )     —       Less: Profit commission and contingent commission income   (6,188 )     (4,691 )     Less: Impact of F.X. rates   (1,277 )     1,146       Less: Other conforming adjustments (2)   —       (2,233 )     Total Organic Revenue & Growth Percentage   49,940       35,220     41.8 % (1) Total Insurance Distribution revenue includes investment income
(2) Change in accounting in 1Q26 related to an MGA contracts on a net basis, normalizing the prior year for consistency. Total Specialty P&C Insurance Production Specialty P&C Insurance production includes gross premiums written by Octave's Specialty P&C Insurance segment and premiums placed by the Insurance Distribution segment.     Three Months Ended March 31, ($ in thousands)     2026     2025   % Change Specialty Property & Casualty Insurance Gross Premiums Written   $ 103,716   $ 86,915   19 % Insurance Distribution Premiums Placed     426,833     233,186   83 % Specialty P&C Insurance Production   $ 530,549   $ 320,101   66 % About Octave Octave Specialty Group, Inc. is a global specialty insurance firm that builds, buys, and scales niche insurance distribution and underwriting businesses. With a focus on operational excellence, disciplined growth, and innovation, Octave is creating a harmonized portfolio of companies that deliver exceptional performance and long-term value for shareholders. For more information, visit www.octavegroup.com. The Amended and Restated Certificate of Incorporation of Octave contains substantial restrictions on the ability to transfer Octave’s common stock. Subject to limited exceptions, any attempted transfer of common stock shall be prohibited and void to the extent that, as a result of such transfer (or any series of transfers of which such transfer is a part), any person or group of persons shall become a holder of 5% or more of Octave’s common stock or a holder of 5% or more of Octave’s common stock increases its ownership interest. Forward-Looking Statements This press release, and any related oral statements, contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as “estimate,” “project,” “plan,” “believe,” “anticipate,” “intend,” “planned,” “potential” and similar expressions, or future or conditional verbs such as “will,” “should,” “would,” “could,” and “may,” or the negative of those expressions or verbs, identify forward-looking statements. We caution readers that these statements are not guarantees of future performance. Forward-looking statements are not historical facts, but instead represent only our beliefs regarding future events, which may by their nature be inherently uncertain and some of which may be outside our control. These statements may relate to plans and objectives with respect to the future, among other things, which may change. We are alerting you to the possibility that our actual results may differ, possibly materially, from the expected objectives or anticipated results that may be suggested, expressed or implied by these forward-looking statements. Important factors that could cause our results to differ, possibly materially, from those indicated in the forward-looking statements include, among others, those discussed under “Risk Factors.” in our most recent SEC filed quarterly or annual report. Any or all of management’s forward-looking statements, whether contained herein or in other publications, may prove to be incorrect and are based on management’s current belief or opinions. Octave Specialty Group’s (“OSG”) and its subsidiaries’ (collectively, “Octave” or the “Company”) actual results may differ materially from those expressed in, or implied by, these forward-looking statements, and there are no guarantees about the performance of Octave’s securities. Among events, risks, uncertainties or factors that could cause actual results to differ materially are: (1) the high degree of volatility in the price of OSG’s common stock; (2) uncertainty concerning the Company’s ability to achieve value for holders of its securities from the specialty property and casualty insurance business, the insurance distribution business, or related businesses; (3) greater than expected underwriting losses in the Company’s specialty property and casualty insurance business resulting in inadequacy of loss and loss expense reserves and the possibility that changes in reserves may result in further volatility of earnings or financial results; (4) credit risk throughout Octave’s business, including but not limited to issuers of securities in our investment portfolios, and exposures to reinsurers; (5) the Company’s level of indebtedness, including its ability to generate sufficient cash to service obligations, refinance existing debt, or obtain additional financing on acceptable terms, and the resulting impact on financial condition and operating flexibility; (6) dependence on third parties, including specialty insurance program partners, reinsurers, distribution relationships, and other service providers, and the risk of failures or disruptions in their performance; (7) inability to obtain reinsurance coverage on economic terms; (8) loss of key relationships for the production of business in our specialty property and casualty and insurance distribution businesses or the inability to secure such additional relationships to produce expected results; (9) the impact of catastrophic public health events, environmental or natural events, or political events, including as a result of global or regional conflicts; (10) restrictive covenants in agreements and instruments that impair Octave’s ability to pursue or achieve its business strategies; (11) regulatory risks, including disagreements with insurance regulators, changes in laws or regulations, and the Company’s ability to adapt to an evolving regulatory environment; (12) risks related to changes in the composition, valuation, or performance of the Company’s investment portfolio, including interest rate and foreign currency exchange rate fluctuations; (13) events or circumstances that result in the impairment of our intangible assets and/or goodwill that were recorded in connection with Octave’s acquisitions; (14) the risk of litigation, regulatory inquiries, investigations, claims or proceedings, and the risk of adverse outcomes in connection therewith; (15) system security risks, data protection breaches and cyberattacks; (16) our inability to attract and retain qualified executives, senior managers and other employees, or the loss of such personnel; (17) greater competition for our specialty property and casualty insurance business and/or our insurance distribution business; (18) loss or lowering of the AM Best rating for our property and casualty insurance company subsidiaries; (19) disintermediation within the insurance industry or greater competition from technology-based insurance solutions or non-traditional insurance markets; (20) changes in law or in the functioning of the healthcare market that impair the business model of our accident and health managing general agents; (21) failure to successfully execute business expansion initiatives, integrate acquired businesses, or realize anticipated benefits from such efforts and significant obligations under put rights granted in completed acquisitions; and (22) other risks and uncertainties that have not been identified at this time. Source: Octave Specialty Group, Inc. View source version on businesswire.com: https://www.businesswire.com/news/home/20260506096134/en/ Karen Beyer
Managing Director, Investor Relations
(212) 208-3222
ir@octavegroup.com Original: Octave Specialty Group Reports First Quarter 2026 Results

Octave Specialty Group to Release First Quarter 2026 Results on May 6, 2026April 9, 2026 4:19 PM
Business Wire
Conference Call Scheduled for May 7, 2026


Octave Specialty Group, Inc. (NYSE: OSG), a global specialty insurance firm, will release first quarter 2026 results on May 6, 2026, following the close of the market.


Conference Call


On May 7, 2026, at 8:30am (ET), Claude LeBlanc, President and Chief Executive Officer, and David Trick, Executive Vice President and Chief Financial Officer, will discuss first quarter 2026 results during a live conference call. A live audio webcast of the call will be available through the Investor Relations section of Octave’s website, www.octavegroup.com. Participants may also listen via telephone by dialing (877) 407-9716 (Domestic) or (201) 493-6779 (International).


The webcast will be archived on Octave’s website. A replay of the call will be available through May 21, 2026, and can be accessed by dialing (844) 512-2921 (Domestic) or (412) 317-6671 (International), using ID# 13759400.


About Octave


Octave Specialty Group, Inc. is a global specialty insurance firm that builds, buys, and scales niche insurance distribution and underwriting businesses. With a focus on operational excellence, disciplined growth, and innovation, Octave is creating a harmonized portfolio of companies that deliver exceptional performance and long-term value for shareholders. For more information, visit www.octavegroup.com.


The Amended and Restated Certificate of Incorporation of Octave contains substantial restrictions on the ability to transfer Octave’s common stock. Subject to limited exceptions, any attempted transfer of common stock shall be prohibited and void to the extent that, as a result of such transfer (or any series of transfers of which such transfer is a part), any person or group of persons shall become a holder of 5% or more of Octave’s common stock or a holder of 5% or more of Octave’s common stock increases its ownership interest.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260409264292/en/
Investors:

Karen Beyer

Managing Director, Investor Relations

kbeyer@octavegroup.com


Media:

Kate Smith

Director, Corporate Communications

ksmith@octavegroup.com


Original: Octave Specialty Group to Release First Quarter 2026 Results on May 6, 2026

Octave Specialty Group Reports Fourth Quarter 2025 ResultsFebruary 23, 2026 4:05 PM
Business Wire

Total P&C premium production increased 15% for the quarter to $303 million



Insurance Distribution Segment


Commission Income grew to $37 million, an increase of 13%



Organic revenue growth equaled 8.1%



Net loss to Shareholders of $(1) million for the quarter, an improvement of 76%



Adjusted EBITDA to Shareholders of $7 million for the quarter, up 33%






Specialty P&C Insurance ("Everspan")


Gross and net premiums written of $80 million and $23 million were up 34% and 978%, respectively



Combined ratio fell below 100%



Net income to Shareholders was $1 million, down 37%



Adjusted EBITDA to Shareholders of $1.5 million, down 46%






Octave Specialty Group, Inc. (NYSE: OSG) ("Octave" or "OSG"), a global specialty insurance firm, today reported its results for the Fourth Quarter 2025.


Claude LeBlanc, President and Chief Executive Officer, stated, "The fourth quarter of 2025 marked the end of a transformational year and the beginning of what we believe is a new era for our company. Following the sale of our legacy financial guarantee business in the third quarter, the acquisition of ArmadaCare in the fourth quarter, and our rebranding as Octave Specialty Group, we emerged as a pure-play specialty P&C company. In the fourth quarter, our insurance distribution business delivered organic growth of over 8%, finishing the year at just over 14%, as we continued to execute on our strategy to build a high-growth, specialty insurance distribution platform that delivers significant long-term value to our shareholders. ArmadaCare, a leading specialty A&H and workplace benefit MGA platform that we recently acquired, materially advances our strategic position by further diversifying our specialty business model in uncorrelated, high-growth segments of the market. During the fourth quarter, we also launched 1889 Specialty, a management liability and professional lines MGA focused on the SME market and backed by A+ capacity. We expect these investments, our expanded and further diversified portfolio of MGA/Us, and our recent corporate cost reduction actions to substantially advance our long-term growth strategy."


LeBlanc continued, “This is truly an exciting time for us. We believe our partnership structure and unique MGA incubator model, which includes aligned capacity and shared technology and business services, continue to distinguish us in the marketplace. As we enter 2026, we expect strong organic growth, bolstered by continued momentum across our core business, including the stable of strong start-ups launched in 2024 and 2025, which are positioned to deliver strong top- and bottom-line growth as these businesses continue to scale."




Octave's Fourth Quarter 2025 Summary Results








 






 






Three Months Ended December 31,






 






Year Ended December 31,








(in thousands, except per share data)1






 






2025






 






2024






 






% Change






 






2025






 






2024






 






% Change








Total revenues from continuing operations






 






 






66,903






 






 






 






65,222






 






 






3






%






 






 






251,222






 






 






 






235,815






 






 






7






%








Total expenses from continuing operations






 






 






97,757






 






 






 






86,322






 






 






13






%






 






 






352,236






 






 






 






295,660






 






 






19






%








Pretax income (loss) from continuing operations






 






 






(30,854






)






 






 






(21,100






)






 






46






%






 






 






(101,014






)






 






 






(59,845






)






 






69






%








Provision (benefit) for income taxes from continuing operations






 






 






(1,181






)






 






 






(157






)






 






NM






 






 






 






(5,211






)






 






 






(924






)






 






NM






 








Net income (loss) from continuing operations






 






 






(29,673






)






 






 






(20,943






)






 






42






%






 






 






(95,803






)






 






 






(58,921






)






 






63






%








Net income (loss) from continuing operations attributable to Octave shareholders, net of tax






 






 






(29,982






)






 






 






(22,163






)






 






35






%






 






 






(98,404






)






 






 






(59,282






)






 






66






%








Net income (loss) from discontinued operations






 






 






—






 






 






 






(526,102






)






 






NM






 






 






 






(163,288






)






 






 






(497,167






)






 






(67






)%








Net income (loss) attributable to Octave shareholders






 






 






(29,982






)






 






 






(548,264






)






 






NM






 






 






 






(261,692






)






 






 






(556,448






)






 






(53






)%








Net income (loss) from continuing operations attributable to stockholders per diluted share 3






 






$






(0.84






)






 






$






(0.56






)






 






50






%






 






$






(2.47






)






 






$






(1.37






)






 






80






%








Net income (loss) attributable to stockholders per diluted share 3






 






$






(0.84






)






 






$






(11.49






)






 






(93






)%






 






$






(5.93






)






 






$






(11.96






)






 






(50






)%








Non-GAAP






 






 






 






 






 






 






 






 






 






 






 






 








EBITDA to shareholders 2






 






 






(19,509






)






 






 






(10,387






)






 






88






%






 






 






(54,929






)






 






 






(36,966






)






 






49






%








Adjusted EBITDA to shareholders2






 






 






1,351






 






 






 






520






 






 






NM






 






 






 






(7,471






)






 






 






2,195






 






 






NM






 








Adjusted net income (loss) attributable to shareholders






 






 






(1,097






)






 






 






(5,676






)






 






(81






)%






 






 






(27,731






)






 






 






(8,606






)






 






NM






 








Per Share






 






 






 






 






 






 






 






 






 






 






 






 








Adjusted net income (loss) to shareholders per diluted share 2






 






$






(0.02






)






 






$






(0.12






)






 






(83






)%






 






$






(0.58






)






 






$






(0.18






)






 






NM






 








Adjusted EBITDA to shareholders per diluted share2






 






$






0.03






 






 






$






0.01






 






 






NM






 






 






$






(0.16






)






 






$






0.05






 






 






NM






 








 






 






 






 






 






 






 






 






 






 






 






 






 








Weighted-average diluted shares outstanding






 






 






45,146






 






 






 






48,129






 






 






(6






)%






 






 






47,181






 






 






 






46,970






 






 






0.4






%









(1)






 






Some financial data in this press release may not add up due to rounding








(2)






 






See Non-GAAP Financial Data section of this press release for further information








(3)






 






Per diluted share includes the impact of adjusting redeemable noncontrolling interests to current redemption value







Fourth Quarter 2025 Summary*


Total revenue from continuing operations for the fourth quarter of 2025 was $67 million, an increase of 3% compared to the $65 million in the same prior-year period. The growth in total revenue was driven by the Insurance Distribution (ID) Segment and Corporate operations, which more than offset a decline in revenue in the Specialty Property and Casualty Segment. Organic growth in our Insurance Distribution Segment was 8.1% during the fourth quarter 2025.


Net loss from continuing operations to Octave shareholders for the fourth quarter of 2025 increased by $(8) million to $(30) million compared to $(22) million in the same prior-year period. The higher net loss was primarily attributed to costs associated with the acquisition of ArmadaCare, expenses associated with the exit from the financial guarantee business, and related expense reduction initiatives, and the impairment of a minority investment from a legacy strategy. Significantly lower interest expense and the impact of the ArmadaCare acquisition helped to partially offset these transactional and transitional expenses.


Adjusted EBITDA from continuing operations to Octave shareholders for the fourth quarter of 2025 was $1.4 million compared to $0.5 million in the same prior-year period, driven by a $1.7 million increase in ID Adjusted EBITDA partially offset by a $1.2 million decline in Adjusted EBITDA at Everspan, associated primarily with Everspan's decline in revenue. Adjusted EBITDA also benefited from a $0.4 million improvement at Corporate related to the initial benefits of our corporate expense reduction initiatives.


* For definitions of each non-GAAP measure referred to above, as well as reconciliation of such non-GAAP measures to their most directly comparable GAAP measures, see "Non-GAAP Financial Measures" below.


Earnings Call and Webcast


On February 24, 2026, at 8:30am ET, Claude LeBlanc, President and Chief Executive Officer, and David Trick, Executive Vice President and Chief Financial Officer, will discuss Octave's fourth quarter 2025 results during a conference call. A live audio webcast of the call will be available through the Investor Relations section of Octave’s website, https://octavegroup.com/investor-relations/events-and-presentations/. Participants may also listen via telephone by dialing (877) 407-9716 or (201) 493-6779 .


The webcast will be archived on Octave's website. A replay of the call will be available through March 10, 2026, and can be accessed by dialing (Domestic) (844) 512-2921 or (International) (412) 317-6671; and using ID#13757987 .


Additional information is included in an operating supplement and presentations on Octave's website at www.octavegroup.com.


Results of Operations by Segment


Insurance Distribution Segment




 






 






Three Months Ended December 31,






 






Year Ended December 31,








($ in thousands)






 






2025






 






2024






 






% Change






 






2025






 






2024






 






% Change








Premiums placed






 






$






223,286






 






 






$






204,909






 






 






9






%






 






$






951,781






 






 






$






493,372






 






 






93






%








Total revenues






 






$






46,466






 






 






$






44,070






 






 






5






%






 






$






163,726






 






 






$






99,236






 






 






65






%








Pretax income (loss)






 






$






(2,295






)






 






$






(4,958






)






 






(54






)%






 






$






(20,456






)






 






$






(7,809






)






 






162






%








Pretax income (loss) to shareholders






 






$






(2,604






)






 






$






(6,178






)






 






(58






)%






 






$






(23,057






)






 






$






(8,172






)






 






182






%








Net income (loss)






 






$






(1,114






)







$






(4,786






)






 






(77






)%






 






$






(15,353






)






 






$






(6,881






)






 






123






%








Net income (loss) to shareholders






 






$






(1,423






)






 






$






(6,006






)






 






(76






)%






 






$






(17,954






)






 






$






(7,244






)






 






148






%








EBITDA






 






$






10,280






 






 






$






9,827






 






 






5






%






 






$






36,918






 






 






$






19,653






 






 






88






%








EBITDA to shareholders1






 






$






6,905






 






 






$






5,286






 






 






31






%






 






$






22,411






 






 






$






13,205






 






 






70






%








Adjusted EBITDA






 






$






10,481






 






 






$






9,827






 






 






7






%






 






$






37,041






 






 






$






19,894






 






 






86






%








Adjusted EBITDA to shareholders1






 






$






7,030






 






 






$






5,286






 






 






33






%






 






$






22,542






 






 






$






13,446






 






 






68






%








Pretax income margin to shareholders2






 






 






(5.6






)%






 






 






(14.0






)%






 






840 bps






 






 






(14.1






)%






 






 






(8.2






)%






 






(590) bps








Adjusted EBITDA margin to shareholders1,3,5






 






 






15.1






%






 






 






12.0






%






 






310 bps






 






 






13.8






%






 






 






13.5






%






 






30 bps








Organic Growth4






 






 






8.1






%






 






 






(3.2






)%






 






 






 






 






14.2






%






 






 






5.4






%






 






 









(1)






 






After the impact of noncontrolling interests








(2)






 






Represents Pretax income divided by total revenues








(3)






 






See Non-GAAP Financial Data section of this press release for further information








(4)







Organic revenue growth includes a $1.2m reduction to 4Q24 revenue to adjust for a revenue recognition accounting policy adjustment made in 4Q24 to recognize revenues that otherwise should have been recorded in 3Q24.








(5)







Represents Adjusted EBITDA to shareholders divided by total revenues







Specialty Property & Casualty Insurance Segment




 






 






Three Months Ended December 31,






 






Year Ended December 31,








($ in thousands)






 






2025






 






2024






 






% Change






 






2025






 






2024






 






% Change








Gross premium written






 






$






80,102






 






 






$






59,987






 






 






34






%






 






$






360,449






 






 






$






382,771






 






 






(6






)%








Net premiums written






 






$






22,910






 






 






$






(2,608






)






 






978






%






 






$






73,898






 






 






$






88,682






 






 






(17






)%








Net premiums earned






 






$






18,324






 






 






$






18,931






 






 






(3






)%






 






$






67,232






 






 






$






99,005






 






 






(32






)%








Total revenue






 






$






23,068






 






 






$






24,818






 






 






(7






)%






 






$






88,403






 






 






$






126,320






 






 






(30






)%








Net income (loss)






 






$






1,158






 






 






$






1,836






 






 






(37






)%






 






$






2,956






 






 






$






10,469






 






 






(72






)%








Adjusted EBITDA to shareholders(1)






 






$






1,460






 






 






$






2,698






 






 






(46






)%






 






$






3,777






 






 






$






5,136






 






 






(26






)%








Loss Ratio






 






 






61.8






%






 






 






51.9






%






 






990 bps






 






 






70.2






%






 






 






73.4






%






 






(320) bps








Expense Ratio






 






 






37.6






%






 






 






44.6






%






 






(700) bps






 






 






35.0






%






 






 






28.2






%






 






680 bps








Combined Ratio






 






 






99.4






%






 






 






96.5






%






 






290 bps






 






 






105.2






%






 






 






101.6






%






 






360 bps









(1)






 






After the impact of noncontrolling interests. See Non-GAAP Financial Data section of this press release for further information







OSG Corporate (holding company only)


OSG on a standalone basis, excluding its ownership interests in its Specialty P&C Insurance and Insurance Distribution subsidiaries, had net assets of $76 million as of December 31, 2025. Assets included cash and liquid securities of $49 million and other investments of $25 million.


Consolidated Octave Financial Group, Inc. Stockholders' Equity and NCI Impact to EPS


Stockholders’ equity attributable to common shareholders at December 31, 2025, was $715,790, or $15.90 per share compared to $783,323 or $16.77 per share as of September 30, 2025. The decline was primarily a result of the net loss from continuing operations attributable to common shareholders of $(30) million, the cost of shares repurchased of $(27) million and change in redeemable noncontrolling interest of $(8) million.


Share Repurchase


Subsequent to September 30, 2025, OSG repurchased in the open market over 3.1 million shares of its outstanding common stock through a 10B5-1 program. These repurchases represented 6.7% of shares outstanding and 6.5% of basic weighted shares outstanding as last reported.


Calculation of Earnings Per Share


Diluted net income per share is computed by dividing net income attributable to shareholders, including adjustments to the redemption value of redeemable noncontrolling interests, by the basic weighted-average shares outstanding plus all potentially dilutive common shares outstanding during the period. The following table provides a reconciliation of net income attributable to shareholders to the numerator in the diluted earnings per share calculation, together with the resulting earnings per share amounts:




 






Three Months Ended December 31,






 






Year Ended December 31,








(in thousands, except per share data)






 






2025






 






 






 






2024






 






 






 






2025






 






 






 






2024






 








Net income (loss) from continuing operations attributable to shareholders






$






(29,982






)






 






$






(22,163






)






 






$






(98,404






)






 






$






(59,282






)








Adjustment for Redeemable NCI






 






(8,017






)






 






 






(4,917






)






 






$






(18,175






)






 






$






(5,222






)








Numerator of diluted EPS






$






(37,999






)






 






$






(27,080






)






 






$






(116,579






)






 






$






(64,504






)








Per Share — Diluted






$






(0.84






)






 






$






(0.56






)






 






$






(2.47






)






 






$






(1.37






)








 






 






 






 






 






 






 






 








Net income (loss) attributable to Octave shareholders






$






(29,982






)






 






$






(548,264






)






 






$






(261,692






)






 






$






(556,448






)








Adjustment for Redeemable NCI






 






(8,017






)






 






 






(4,917






)






 






 






(18,175






)






 






 






(5,222






)








Numerator of diluted EPS






$






(37,999






)






 






$






(553,181






)






 






$






(279,867






)






 






$






(561,670






)








Per Share — Diluted






$






(0.84






)






 






$






(11.49






)






 






$






(5.93






)






 






$






(11.96






)








 






 






 






 






 






 






 






 








WASO-Diluted






 






45,146






 






 






 






48,129






 






 






 






47,181






 






 






 






46,970






 







OCTAVE SPECIALTY GROUP, INC. AND SUBSIDIARIES


Consolidated Statements of Income (Loss) (Unaudited)




 






 






Three Months Ended December 31,






 






Year Ended December 31,








($ in thousands, except share data)






 






 






2025






 






 






 






2024






 






 






 






2025






 






 






 






2024






 








Revenues:






 






 






 






 






 






 






 






 








Commissions






 






$






40,229






 






 






$






38,009






 






 






$






143,381






 






 






$






92,023






 








Servicing and other fees






 






 






6,128






 






 






 






4,087






 






 






 






20,419






 






 






 






6,353






 








Net premiums earned






 






 






18,324






 






 






 






18,931






 






 






 






67,232






 






 






 






99,005






 








Program fees






 






 






3,583






 






 






 






3,989






 






 






 






14,322






 






 






 






13,506






 








Investment income






 






 






2,557






 






 






 






3,557






 






 






 






10,647






 






 






 






14,448






 








Other






 






 






(3,918






)






 






 






(3,351






)






 






 






(4,780






)






 






 






10,480






 








Total revenues






 






 






66,903






 






 






 






65,222






 






 






 






251,222






 






 






 






235,815






 








Expenses:






 






 






 






 






 






 






 






 








Commissions






 






 






8,102






 






 






 






13,667






 






 






 






37,037






 






 






 






40,876






 








Losses and loss adjustment expenses






 






 






11,333






 






 






 






9,826






 






 






 






47,193






 






 






 






72,626






 








Policy acquisition costs






 






 






4,759






 






 






 






7,850






 






 






 






15,790






 






 






 






23,666






 








General and administrative






 






 






58,843






 






 






 






39,730






 






 






 






191,624






 






 






 






129,166






 








Intangible amortization and depreciation






 






 






13,289






 






 






 






9,615






 






 






 






41,952






 






 






 






19,947






 








Interest






 






 






1,431






 






 






 






5,634






 






 






 






18,640






 






 






 






9,379






 








Total expenses






 






 






97,757






 






 






 






86,322






 






 






 






352,236






 






 






 






295,660






 








Pretax income (loss) from continuing operations






 






 






(30,854






)






 






 






(21,100






)






 






 






(101,014






)






 






 






(59,845






)








Provision (benefit) for income taxes from continuing operations






 






 






(1,181






)






 






 






(157






)






 






 






(5,211






)






 






 






(924






)








Net income (loss) from continuing operations






 






 






(29,673






)






 






 






(20,943






)






 






 






(95,803






)






 






 






(58,921






)








Net income (loss) from discontinued operations






 






 






—






 






 






 






(526,102






)






 






 






(163,288






)






 






 






(497,167






)








Net income (loss)






 






 






(29,673






)






 






 






(547,045






)






 






 






(259,091






)






 






 






(556,087






)








Net (gain) loss attributable to noncontrolling interest






 






 






(309






)






 






 






(1,220






)






 






 






(2,601






)






 






 






(361






)








Net income (loss) attributable to shareholders






 






$






(29,982






)






 






$






(548,264






)






 






$






(261,692






)






 






$






(556,448






)








 






 






 






 






 






 






 






 






 








Net income (loss) from continuing operations attributable to stockholders






 






$






(29,982






)






 






$






(22,163






)






 






$






(98,404






)






 






$






(59,282






)








Net income (loss) from discontinued operations attributable to stockholders






 






 






—






 






 






 






(526,102






)






 






 






(163,288






)






 






 






(497,166






)








Net income (loss) attributable to shareholders






 






$






(29,982






)






 






$






(548,264






)






 






$






(261,692






)






 






$






(556,448






)








 






 






 






 






 






 






 






 






 








Net income (loss) from continuing operations per share attributable to stockholders






 






 






 






 






 






 






 






 








Basic






 






$






(0.84






)






 






$






(0.56






)






 






$






(2.47






)






 






$






(1.37






)








Diluted






 






$






(0.84






)






 






$






(0.56






)






 






$






(2.47






)






 






$






(1.37






)








 






 






 






 






 






 






 






 






 








Net income (loss) per share attributable to stockholders






 






 






 






 






 






 






 






 








Basic






 






$






(0.84






)






 






$






(11.49






)






 






$






(5.93






)






 






$






(11.96






)








Diluted






 






$






(0.84






)






 






$






(11.49






)






 






$






(5.93






)






 






$






(11.96






)








 






 






 






 






 






 






 






 






 








Weighted average number of common shares outstanding:






 






 






 






 






 






 






 






 








Basic






 






 






45,146,058






 






 






 






48,128,820






 






 






 






47,181,227






 






 






 






46,969,708






 








Diluted






 






 






45,146,058






 






 






 






48,128,820






 






 






 






47,181,227






 






 






 






46,969,708






 







OCTAVE SPECIALTY GROUP, INC. AND SUBSIDIARIES


Consolidated Balance Sheets (Unaudited)




($ in thousands, except share data)






 






December 31,

2025






 






September 30,

2025 (1)








Assets:






 






 






 






 








Investments:






 






 






 






 








Fixed maturity securities, at fair value (amortized cost: $123,415 and $132,617)






 






$






122,295






 






 






$






131,101






 








Short-term investments, at fair value (amortized cost: $146,433 and $295,815)






 






 






146,442






 






 






 






295,825






 








Other investments (includes $7,454 and $7,684 at fair value)






 






 






24,971






 






 






 






28,302






 








Total investments (net of allowance for credit losses of $0 and $0)






 






 






293,708






 






 






 






455,228






 








Cash and cash equivalents (including $40,754 and $17,669 of restricted cash)






 






 






68,440






 






 






 






51,767






 








Premium receivables (net of allowance for credit losses of $500 and $142)






 






 






75,085






 






 






 






74,760






 








Commission and fees receivable






 






 






86,549






 






 






 






75,480






 








Reinsurance recoverable on paid and unpaid losses (net of allowance for credit losses of $450 and $338)






 






 






436,092






 






 






 






440,462






 








Deferred ceded premium






 






 






146,365






 






 






 






160,906






 








Policy acquisition costs






 






 






9,732






 






 






 






9,284






 








Intangible assets, less accumulated amortization






 






 






474,998






 






 






 






339,197






 








Goodwill






 






 






540,345






 






 






 






445,382






 








Other assets






 






 






92,003






 






 






 






95,424






 








Total assets






 






$






2,223,317






 






 






$






2,147,890






 








Liabilities and Stockholders’ Equity:






 






 






 






 








Liabilities:






 






 






 






 








Unearned premiums






 






$






187,178






 






 






$






197,133






 








Loss and loss adjustment expense reserves






 






 






459,990






 






 






 






437,539






 








Ceded premiums payable






 






 






80,561






 






 






 






87,635






 








Deferred program fees and reinsurance commissions






 






 






6,978






 






 






 






7,754






 








Deferred taxes






 






 






65,217






 






 






 






68,865






 








Long-term debt






 






 






117,558






 






 






 






—






 








Accrued interest payable






 






 






1,343






 






 






 






—






 








Commission payable






 






 






115,555






 






 






 






109,317






 








Other liabilities






 






 






102,771






 






 






 






92,226






 








Total liabilities






 






 






1,137,151






 






 






 






1,000,469






 








 






 






 






 






 








Redeemable noncontrolling interest






 






 






252,981






 






 






 






248,308






 








Stockholders’ equity:






 






 






 






 








Preferred stock, par value $0.01 per share; 20,000,000 shares authorized shares; issued and outstanding shares—none






 






 






—






 






 






 






—






 








Common stock, par value $0.01 per share; 130,000,000 shares authorized; issued shares: 48,876,882 and 48,875,167






 






 






489






 






 






 






489






 








Additional paid-in capital






 






 






369,860






 






 






 






367,077






 








Accumulated other comprehensive income (loss)






 






 






8,483






 






 






 






7,426






 








Retained earnings






 






 






370,431






 






 






 






436,026






 








Treasury stock, shares at cost: 3,871,598 and 2,368,194






 






 






(33,473






)






 






 






(27,695






)








Total Octave Specialty Group, Inc. stockholders’ equity






 






 






715,790






 






 






 






783,323






 








Nonredeemable noncontrolling interest






 






 






117,395






 






 






 






115,790






 








Total stockholders’ equity






 






 






833,185






 






 






 






899,113






 








Total liabilities, redeemable noncontrolling interest and stockholders’ equity






 






$






2,223,317






 






 






$






2,147,890






 









(1)






 






The September 30, 2025 Consolidated Balance Sheet reflects a correction to redeemable noncontrolling interest and total stockholders' equity $60.1 million







Non-GAAP Financial Data


In addition to reporting the Company’s quarterly financial results in accordance with GAAP, the Company is reporting non-GAAP financial measures: EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin, Organic Revenue Growth Rate (Insurance Distribution segment only), Adjusted Net Income and Adjusted Net Income Margin. These amounts are derived from our consolidated financial information, but are not presented in our consolidated financial results.


We present non-GAAP supplemental financial information because we believe such information is of interest to the investment community, and that it provides greater transparency and enhanced visibility into the underlying drivers and performance of our businesses on a basis that may not be otherwise apparent on a GAAP basis. We view these non-GAAP financial measures as important indicators when assessing and evaluating our performance on a segmented and consolidated basis and they are presented to improve the comparability of our results between periods by eliminating the impact of the items that may not be representative of our core operating performance. These non-GAAP financial measures are not substitutes for the Company’s GAAP reporting, should not be viewed in isolation and may differ from similar reporting provided by other companies, which may define non-GAAP measures differently


The following paragraphs define each non-GAAP financial measure. A tabular reconciliation of the non-GAAP financial measure and the most comparable GAAP financial measure is also presented below.


Non-GAAP Financial Measures


Organic Revenue Growth & Rate (Insurance Distribution Only.) — Organic revenue is based on commissions and fees for the relevant period by excluding (i) the first twelve months of commissions and fees generated from acquisitions, (ii) commissions and fees from divestitures and (iii) and other items such as contingent commissions and the impact of changes in foreign exchange rates.


Organic Revenue Growth is the change in organic revenue period-to-period, with prior period results adjusted to (i) include commissions and fees that were excluded from organic revenue in the prior period and reached the twelve-month owned mark in the current period, and (ii) exclude commissions and fees related to divestitures from organic revenue.


Total Specialty P&C Insurance Production Specialty P&C Insurance production, which includes gross premiums written by Octave's Specialty P&C Insurance segment and premiums placed by the Insurance Distribution segment. Specialty P&C Insurance revenues are dependent on gross premiums written, as specialty program insurance companies earn premiums based on the portion of gross premiums written retained (i.e. net premiums written) and fees on gross premiums written that are ceded to reinsurers. Insurance Distribution revenues are dependent on premium volume, as Managing General Agents/Underwriters and brokers receive commissions based on the amount of premiums placed (i.e. gross premiums written on behalf of insurance carriers) with insurance carriers.


EBITDA — EBITDA is net income (loss) from continuing operations before interest expense, income taxes, depreciation and amortization of intangible assets.


EBITDA Margin — EBITDA divided by total revenues.


Adjusted EBITDA and Adjusted EBITDA Margin — We define Adjusted EBITDA as net income (loss) from continuing operations before interest expense, income taxes, depreciation, amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration-related expenses, severance, and other exceptional or non-recurring items, including those related to raising capital. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance, and that the presentation of this measure enhances an investor's understanding of our financial performance.


Adjusted Net Income and Adjusted Net Income Margin — We define Adjusted Net Income as net income (loss) from continuing operations attributable to Octave adjusted for amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration -related expenses, severance and non-recurring income and loss items that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. Per share amounts exclude any impact of revaluing non-controlling interests as otherwise reported under GAAP earnings per share. We believe that Adjusted Net Income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance.


Results of Operations by Segment (Continued)




Three Months Ended December 31, 2025






 






Specialty Property & Casualty Insurance






 






Insurance Distribution






 






Corporate & Other






 






Consolidated








($ in thousands)






 






 






 






 






 






 






 






 








Gross premiums written






 






$






80,102






 






 






 






 






 






 






$






80,102






 








Net premiums written






 






 






22,910






 






 






 






 






 






 






 






22,910






 








Total revenues from Continuing Operations






 






 






23,068






 






 






 






46,466






 






 






 






(2,631






)






 






 






66,903






 








Total expenses from Continuing Operations






 






 






21,814






 






 






 






48,761






 






 






 






27,181






 






 






 






97,757






 








Pretax income (loss)






 






 






1,254






 






 






 






(2,295






)






 






 






(29,812






)






 






 






(30,854






)








Provision (benefit) for income taxes






 






 






96






 






 






 






(1,181






)






 






 






(96






)






 






 






(1,181






)








Net income (loss) from Continuing Operations






 






$






1,158






 






 






$






(1,114






)






 






$






(29,716






)






 






$






(29,673






)








 






 






 






 






 






 






 






 






 








Adjustments to EBITDA






 






 






 






 






 






 






 






 








Add: Interest expense






 






 






 






$






1,431






 






 






 






 






$






1,431






 








Add: Income tax expense






 






 






96






 






 






 






(1,181






)






 






 






(96






)






 






 






(1,181






)








Add: Depreciation






 






 






—






 






 






 






347






 






 






 






2,145






 






 






 






2,492






 








Add: Intangible amortization






 






 






 






 






10,797






 






 






 






 






 






10,797






 








EBITDA from Continuing Operations






 






$






1,254






 






 






$






10,280






 






 






$






(27,667






)






 






$






(16,134






)








EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






1,254






 






 






$






6,905






 






 






$






(27,667






)






 






$






(19,509






)








 






 






 






 






 






 






 






 






 








Adjustments to Adjusted EBITDA






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






$






—






 






 






$






—






 






 






$






7,796






 






 






$






7,796






 








Add: Equity-based compensation expense






 






 






206






 






 






 






201






 






 






 






2,072






 






 






 






2,479






 








Add: Severance and restructuring expense






 






 






—






 






 






 






—






 






 






 






7,561






 






 






 






7,561






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






—






 






 






 






3,100






 






 






 






3,100






 








Adjusted EBITDA from Continuing Operations






 






 






1,460






 






 






 






10,481






 






 






 






(7,138






)






 






 






4,802






 








Adjusted EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






1,460






 






 






$






7,030






 






 






$






(7,138






)






 






$






1,351






 








 






 






 






 






 






 






 






 






 








Net income (loss) (Continuing Operations)






 






$






1,158






 






 






$






(1,114






)






 






$






(29,716






)






 






$






(29,673






)








Adjustments:






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






 






—






 






 






 






—






 






 






 






7,796






 






 






 






7,796






 








Add: Intangible amortization






 






 






—






 






 






 






10,797






 






 






 






—






 






 






 






10,797






 








Add: Equity-based compensation expense






 






 






206






 






 






 






201






 






 






 






2,072






 






 






 






2,479






 








Add: Severance and restructuring expense






 






 






—






 






 






 






—






 






 






 






9,453






 






 






 






9,453






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






—






 






 






 






3,100






 






 






 






3,100






 








Adjusted net income (loss) before tax and NCI






 






 






1,364






 






 






 






9,884






 






 






 






(7,295






)






 






 






3,952






 








Income tax effects






 






 






(43






)






 






 






(2,050






)






 






 






43






 






 






 






(2,050






)








Adjusted net income (loss) before NCI






 






 






1,321






 






 






 






7,834






 






 






 






(7,252






)






 






 






1,902






 








Net (income) loss attributable to noncontrolling interest






 






 






—






 






 






 






(2,999






)






 






 






—






 






 






 






(2,999






)








Adjusted net income (loss) attributable to shareholders






 






$






1,321






 






 






$






4,835






 






 






$






(7,252






)






 






$






(1,097






)








 






 






 






 






 






 






 






 






 








Net income (loss) margin






 






 






5.0






%






 






 






(2.4






)%






 






 






NM






 






 






 






(44.4






)%








Adjusted EBITDA Margin






 






 






6.3






%






 






 






22.6






%






 






 






NM






 






 






 






7.2






%








Adjusted EBITDA Margin to Octave shareholders






 






 






6.3






%






 






 






15.1






%






 






 






NM






 






 






 






2.0






%








Adjusted Net income (loss) after NCI margin






 






 






5.7






%






 






 






10.4






%






 






 






NM






 






 






 






(1.6






)%









Three Months Ended December 31, 2024






 






Specialty Property & Casualty Insurance






 






Insurance Distribution






 






Corporate & Other






 






Consolidated








($ in thousands)






 






 






 






 






 






 






 






 








Gross premiums written






 






$






59,987






 






 






 






 






 






 






$






59,987






 








Net premiums written






 






 






(2,608






)






 






 






 






 






 






 






(2,608






)








Total revenues from Continuing Operations






 






 






24,818






 






 






 






44,070






 






 






 






(3,666






)






 






 






65,222






 








Total expenses from Continuing Operations






 






 






22,252






 






 






 






49,028






 






 






 






15,042






 






 






 






86,322






 








Pretax income (loss)






 






 






2,566






 






 






 






(4,958






)






 






 






(18,708






)






 






 






(21,100






)








Provision (benefit) for income taxes






 






 






730






 






 






 






(172






)






 






 






(715






)






 






 






(157






)








Net income (loss) from Continuing Operations






 






$






1,836






 






 






$






(4,786






)






 






$






(17,993






)






 






$






(20,943






)








 






 






 






 






 






 






 






 






 








Adjustments to EBITDA






 






 






 






 






 






 






 






 








Add: Interest expense






 






 






 






$






5,639






 






 






 






 






$






5,639






 








Add: Income tax expense






 






 






730






 






 






 






(172






)






 






 






(715






)






 






 






(157






)








Add: Depreciation






 






 






 






 






245






 






 






 






469






 






 






 






714






 








Add: Intangible amortization






 






 






 






 






8,901






 






 






 






 






 






8,901






 








EBITDA from Continuing Operations






 






$






2,566






 






 






$






9,827






 






 






$






(18,239






)






 






$






(5,846






)








EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






2,566






 






 






$






5,286






 






 






$






(18,239






)






 






$






(10,387






)








 






 






 






 






 






 






 






 






 








Adjustments to Adjusted EBITDA






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






 






—






 






 






$






—






 






 






$






1,561






 






 






 






1,561






 








Add: Equity-based compensation expense






 






 






132






 






 






 






—






 






 






 






2,689






 






 






 






2,821






 








Add: Severance and restructuring expense






 






 






—






 






 






 






—






 






 






 






362






 






 






 






362






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






—






 






 






 






6,163






 






 






 






6,163






 








Adjusted EBITDA from Continuing Operations






 






 






2,698






 






 






 






9,827






 






 






 






(7,464






)






 






 






5,061






 








Adjusted EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






2,698






 






 






$






5,286






 






 






$






(7,464






)






 






$






520






 








 






 






 






 






 






 






 






 






 








Net income (loss) (Continuing Operations)






 






$






1,836






 






 






$






(4,786






)






 






$






(17,993






)






 






$






(20,943






)








Adjustments:






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






 






—






 






 






 






—






 






 






 






1,561






 






 






 






1,561






 








Add: Intangible amortization






 






 






—






 






 






 






8,901






 






 






 






—






 






 






 






8,901






 








Add: Equity-based compensation expense






 






 






132






 






 






 






—






 






 






 






2,689






 






 






 






2,821






 








Add: Severance and restructuring expense






 






 






—






 






 






 






—






 






 






 






362






 






 






 






362






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






—






 






 






 






6,163






 






 






 






6,163






 








Adjusted net income (loss) before tax and NCI






 






 






1,968






 






 






 






4,115






 






 






 






(7,218






)






 






 






(1,135






)








Income tax effects






 






 






—






 






 






 






—






 






 






 






—






 






 






 






—






 








Adjusted net income (loss) before NCI






 






 






1,968






 






 






 






4,115






 






 






 






(7,218






)






 






 






(1,135






)








Net (income) loss attributable to noncontrolling interest






 






 






—






 






 






 






(4,541






)






 






 






—






 






 






 






(4,541






)








Adjusted net income (loss) attributable to shareholders






 






$






1,968






 






 






$






(426






)






 






$






(7,218






)






 






$






(5,676






)








 






 






 






 






 






 






 






 






 








Net income (loss) margin






 






 






7.4






%






 






 






(10.9






)%






 






 






NM






 






 






 






(32.1






)%








Adjusted EBITDA Margin






 






 






10.9






%






 






 






22.3






%






 






 






NM






 






 






 






7.8






%








Adjusted EBITDA Margin to Octave shareholders






 






 






10.9






%






 






 






12.0






%






 






 






NM






 






 






 






0.8






%








Adjusted Net income (loss) after NCI margin






 






 






7.9






%






 






 






(1.0






)%






 






 






NM






 






 






 






(8.7






)%







Results of Operations by Segment (Continued)




Year Ended December 31, 2025






 






Specialty Property & Casualty Insurance






 






Insurance Distribution






 






Corporate & Other






 






Consolidated








($ in thousands)






 






 






 






 






 






 






 






 








Gross premiums written






 






$






360,449






 






 






 






 






 






 






$






360,449






 








Net premiums written






 






 






73,898






 






 






 






 






 






 






 






73,898






 








Total revenues from Continuing Operations






 






 






88,403






 






 






 






163,726






 






 






 






(907






)






 






 






251,222






 








Total expenses from Continuing Operations






 






 






85,073






 






 






 






184,182






 






 






 






82,981






 






 






 






352,236






 








Pretax income (loss)






 






 






3,330






 






 






 






(20,456






)






 






 






(83,888






)






 






 






(101,014






)








Provision (benefit) for income taxes






 






 






374






 






 






 






(5,103






)






 






 






(482






)






 






 






(5,211






)








Net income (loss) from Continuing Operations






 






$






2,956






 






 






$






(15,353






)






 






$






(83,406






)






 






$






(95,803






)








 






 






 






 






 






 






 






 






 








Adjustments to EBITDA






 






 






 






 






 






 






 






 








Add: Interest expense






 






$






—






 






 






$






18,640






 






 






$






—






 






 






$






18,640






 








Add: Income tax expense






 






 






374






 






 






 






(5,103






)






 






 






(482






)






 






 






(5,211






)








Add: Depreciation






 






 






—






 






 






 






690






 






 






 






3,218






 






 






 






3,908






 








Add: Intangible amortization






 






 






—






 






 






 






38,044






 






 






 






—






 






 






 






38,044






 








EBITDA from Continuing Operations






 






$






3,330






 






 






$






36,918






 






 






$






(80,670






)






 






$






(40,422






)








EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






3,330






 






 






$






22,411






 






 






$






(80,670






)






 






$






(54,929






)








 






 






 






 






 






 






 






 






 








Adjustments to Adjusted EBITDA






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






$






—






 






 






$






375






 






 






$






9,106






 






 






$






9,481






 








Add: Equity-based compensation expense






 






 






447






 






 






 






368






 






 






 






11,494






 






 






 






12,309






 








Add: Severance and restructuring expense






 






 






—






 






 






 






60






 






 






 






21,173






 






 






 






21,233






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






(591






)






 






 






5,108






 






 






 






4,517






 








Adjusted EBITDA from Continuing Operations






 






 






3,777






 






 






 






37,041






 






 






 






(33,789






)






 






 






7,028






 








Adjusted EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






3,777






 






 






$






22,542






 






 






$






(33,789






)






 






$






(7,471






)








 






 






 






 






 






 






 






 






 








Net income (loss) (Continuing Operations)






 






$






2,955






 






 






$






(15,353






)






 






$






(83,404






)






 






$






(95,800






)








Adjustments:






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






 






—






 






 






 






375






 






 






 






9,106






 






 






 






9,481






 








Add: Intangible amortization






 






 






—






 






 






 






38,044






 






 






 






—






 






 






 






38,044






 








Add: Equity-based compensation expense






 






 






447






 






 






 






368






 






 






 






11,494






 






 






 






12,309






 








Add: Severance and restructuring expense






 






 






—






 






 






 






60






 






 






 






23,065






 






 






 






23,125






 








Add: Other non-operating (income) losses






 






 






—






 






 






 






(591






)






 






 






5,108






 






 






 






4,517






 








Adjusted net income (loss) before tax and NCI






 






 






3,403






 






 






 






22,903






 






 






 






(34,633






)






 






 






(8,328






)








Income tax effects






 






 






(58






)






 






 






(6,009






)






 






 






58






 






 






 






(6,009






)








Adjusted net income (loss) before NCI






 






 






3,345






 






 






 






16,894






 






 






 






(34,575






)






 






 






(14,337






)








Net (income) loss attributable to noncontrolling interest






 






 






—






 






 






 






(13,394






)






 






 






—






 






 






 






(13,394






)








Adjusted net income (loss) attributable to shareholders






 






$






3,345






 






 






$






3,500






 






 






$






(34,575






)






 






$






(27,731






)








 






 






 






 






 






 






 






 






 








Net income (loss) margin






 






 






3.3






%






 






 






(9.4






)%






 






 






NM






 






 






 






(38.1






)%








Adjusted EBITDA Margin






 






 






4.3






%






 






 






22.6






%






 






 






NM






 






 






 






2.8






%








Adjusted EBITDA Margin to Octave shareholders






 






 






4.3






%






 






 






13.8






%






 






 






NM






 






 






 






(3.0






)%








Adjusted Net income (loss) after NCI margin






 






 






3.8






%






 






 






2.1






%






 






 






NM






 






 






 






(11.0






)%









Year Ended December 31, 2024






 






Specialty Property & Casualty Insurance






 






Insurance Distribution






 






Corporate & Other






 






Consolidated








($ in thousands)






 






 






 






 






 






 






 






 








Gross premiums written






 






$






382,771






 






 






 






 






 






 






$






382,771






 








Net premiums written






 






 






88,682






 






 






 






 






 






 






 






88,682






 








Total revenues from Continuing Operations






 






 






126,320






 






 






 






99,236






 






 






 






10,259






 






 






 






235,815






 








Total expenses from Continuing Operations






 






 






114,098






 






 






 






107,045






 






 






 






74,516






 






 






 






295,660






 








Pretax income (loss)






 






 






12,222






 






 






 






(7,809






)






 






 






(64,257






)






 






 






(59,845






)








Provision (benefit) for income taxes






 






 






1,753






 






 






 






(928






)






 






 






(1,748






)






 






 






(924






)








Net income (loss) from Continuing Operations






 






$






10,469






 






 






$






(6,881






)






 






$






(62,509






)






 






$






(58,921






)








 






 






 






 






 






 






 






 






 








Adjustments to EBITDA






 






 






 






 






 






 






 






 








Add: Interest expense






 






$






—






 






 






$






9,379






 






 






$






—






 






 






$






9,379






 








Add: Income tax expense






 






 






1,753






 






 






 






(928






)






 






 






(1,748






)






 






 






(924






)








Add: Depreciation






 






 






—






 






 






 






481






 






 






 






1,864






 






 






 






2,345






 








Add: Intangible amortization






 






 






—






 






 






 






17,602






 






 






 






—






 






 






 






17,602






 








EBITDA from Continuing Operations






 






$






12,222






 






 






$






19,653






 






 






$






(62,393






)






 






$






(30,518






)








EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






12,222






 






 






$






13,205






 






 






$






(62,393






)






 






$






(36,966






)








 






 






 






 






 






 






 






 






 








Adjustments to Adjusted EBITDA






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






$






—






 






 






$






—






 






 






$






27,388






 






 






$






27,388






 








Add: Equity-based compensation expense






 






 






414






 






 






 






—






 






 






 






8,941






 






 






 






9,355






 








Add: Severance and restructuring expense






 






 






—






 






 






 






248






 






 






 






7,352






 






 






 






7,600






 








Add: Other non-operating (income) losses






 






 






(7,500






)






 






 






—






 






 






 






2,318






 






 






 






(5,182






)








Adjusted EBITDA from Continuing Operations






 






 






5,136






 






 






 






19,901






 






 






 






(16,394






)






 






 






8,643






 








Adjusted EBITDA from Continuing Operations attributable to




Octave shareholders






 






$






5,136






 






 






$






13,453






 






 






$






(16,394






)






 






$






2,195






 








 






 






 






 






 






 






 






 






 








Net income (loss) (Continuing Operations)






 






$






10,466






 






 






$






(6,769






)






 






$






(62,508






)






 






$






(58,812






)








Adjustments:






 






 






 






 






 






 






 






 








Add: Acquisition and integration related expenses






 






 






—






 






 






 






—






 






 






 






27,388






 






 






 






27,388






 








Add: Intangible amortization






 






 






—






 






 






 






17,602






 






 






 






—






 






 






 






17,602






 








Add: Equity-based compensation expense






 






 






414






 






 






 






—






 






 






 






8,941






 






 






 






9,355






 








Add: Severance and restructuring expense






 






 






—






 






 






 






248






 






 






 






7,352






 






 






 






7,600






 








Add: Other non-operating (income) losses






 






 






(7,500






)






 






 






—






 






 






 






2,318






 






 






 






(5,182






)








Adjusted net income (loss) before tax and NCI






 






 






3,383






 






 






 






10,969






 






 






 






(16,510






)






 






 






(2,158






)








Income tax effects






 






 






—






 






 






 






—






 






 






 






—






 






 






 






—






 








Adjusted net income (loss) before NCI






 






 






3,383






 






 






 






10,969






 






 






 






(16,510






)






 






 






(2,158






)








Net (income) loss attributable to noncontrolling interest






 






 






—






 






 






 






(6,448






)






 






 






—






 






 






 






(6,448






)








Adjusted net income (loss) attributable to shareholders






 






$






3,383






 






 






$






4,521






 






 






$






(16,510






)






 






$






(8,606






)








 






 






 






 






 






 






 






 






 








Net income (loss) margin






 






 






8.3






%






 






 






(6.9






)%






 






 






NM






 






 






 






(25.0






)%








Adjusted EBITDA Margin






 






 






4.1






%






 






 






20.1






%






 






 






NM






 






 






 






3.7






%








Adjusted EBITDA Margin to Octave shareholders






 






 






4.1






%






 






 






13.6






%






 






 






NM






 






 






 






0.9






%








Adjusted Net income (loss) after NCI margin






 






 






2.7






%






 






 






4.6






%






 






 






NM






 






 






 






(3.6






)%







Organic Growth




 






 






Three Months Ended December 31,






 






Year Ended December 31,








($ in thousands)






 






 






2025






 






 






 






2024






 






 






% Growth






 






 






2025






 






 






 






2024






 






 






% Growth








Total Insurance Distribution revenue (1)






 






$






46,594






 






 






$






44,096






 






 






5.7






%






 






$






163,855






 






 






$






99,236






 






 






65.1






%








Less: Acquired revenues (2)






 






 






(4,998






)






 






 






(1,200






)






 






 






 






 






(50,102






)






 






 






(1,200






)






 






 








Less: Profit commission and contingent commission income






 






 






(3,003






)






 






 






(5,449






)






 






 






 






 






(11,898






)






 






 






(6,400






)






 






 








Total Organic Revenue & Growth Percentage






 






 






38,523






 






 






 






35,628






 






 






8.1






%






 






 






104,427






 






 






 






91,453






 






 






14.2






%









(1)






 






Total Insurance Distribution revenue includes investment income








(2)






 






Organic revenue growth includes a $1.2m reduction to 4Q24 revenue to adjust for a revenue recognition accounting policy adjustment made in 4Q24 to recognize revenues that otherwise should have been recorded in 3Q24.







Total Specialty P&C Insurance Production


Specialty P&C Insurance production includes gross premiums written by Octave's Specialty P&C Insurance segment and premiums placed by the Insurance Distribution segment.




 






 






Three Months Ended December 31,






 






Year Ended December 31,








($ in thousands)






 






 






2025






 






 






2024






 






% Change






 






 






2025






 






 






2024






 






% Change








Specialty Property & Casualty Insurance Gross Premiums Written






 






$






80,102






 






$






59,987






 






34






%






 






$






360,449






 






$






382,771






 






(6






)%








Insurance Distribution Premiums Placed






 






 






223,286






 






 






204,909






 






9






%






 






 






951,781






 






 






493,372






 






93






%








Specialty P&C Insurance Production






 






$






303,388






 






$






264,896






 






15






%






 






$






1,312,230






 






$






876,143






 






50






%







About Octave


Octave Specialty Group, Inc. is a global specialty insurance firm that builds, buys, and scales niche insurance distribution and underwriting businesses. With a focus on operational excellence, disciplined growth, and innovation, Octave is creating a harmonized portfolio of companies that deliver exceptional performance and long-term value for shareholders. For more information, visit www.octavegroup.com.


The Amended and Restated Certificate of Incorporation of Octave contains substantial restrictions on the ability to transfer Octave’s common stock. Subject to limited exceptions, any attempted transfer of common stock shall be prohibited and void to the extent that, as a result of such transfer (or any series of transfers of which such transfer is a part), any person or group of persons shall become a holder of 5% or more of Octave’s common stock or a holder of 5% or more of Octave’s common stock increases its ownership interest.


Forward-Looking Statements


This press release, and any related oral statements, contain statements that may constitute “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Words such as “estimate,” “project,” “plan,” “believe,” “anticipate,” “intend,” “planned,” “potential” and similar expressions, or future or conditional verbs such as “will,” “should,” “would,” “could,” and “may,” or the negative of those expressions or verbs, identify forward-looking statements. We caution readers that these statements are not guarantees of future performance. Forward-looking statements are not historical facts, but instead represent only our beliefs regarding future events, which may by their nature be inherently uncertain and some of which may be outside our control. These statements may relate to plans and objectives with respect to the future, among other things which may change. We are alerting you to the possibility that our actual results may differ, possibly materially, from the expected objectives or anticipated results that may be suggested, expressed or implied by these forward-looking statements. Important factors that could cause our results to differ, possibly materially, from those indicated in the forward-looking statements include, among others, those discussed under “Risk Factors” in our most recent SEC filed quarterly or annual report.


Any or all of management’s forward-looking statements, whether contained herein or in other publications may prove to be incorrect and are based on management’s current belief or opinions. Octave Specialty Group’s (“OSG”) and its subsidiaries’ (collectively, “Octave” or the “Company”) actual results may differ materially from those expressed in, or implied by, these forward-looking statements,, and there are no guarantees about the performance of Octave’s securities. Among events, risks, uncertainties or factors that could cause actual results to differ materially are: (1) the high degree of volatility in the price of OSG’s common stock; (2) uncertainty concerning the Company’s ability to achieve value for holders of its securities from the specialty property and casualty insurance business, the insurance distribution business, or related businesses; (3) greater than expected underwriting losses in the Company’s specialty property and casualty insurance business resulting in inadequacy of loss and loss expense reserves and the possibility that changes in reserves may result in further volatility of earnings or financial results; (4) credit risk throughout Octave’s business, including but not limited to issuers of securities in our investment portfolios, and exposures to reinsurers; (5) the Company’s level of indebtedness, including its ability to generate sufficient cash to service obligations, refinance existing debt, or obtain additional financing on acceptable terms, and the resulting impact on financial condition and operating flexibility; (6) dependence on third parties, including specialty insurance program partners, reinsurers, distribution relationships, and other service providers, and the risk of failures or disruptions in their performance; (7) inability to obtain reinsurance coverage on economic terms; (8) loss of key relationships for production of business in specialty property and casualty and insurance distribution businesses or the inability to secure such additional relationships to produce expected results; (9) the impact of catastrophic public health, environmental or natural events, or political events, including as a result of global or regional conflicts; (10) restrictive covenants in agreements and instruments that impair Octave’s ability to pursue or achieve its business strategies; (11) regulatory risks, including disagreements with insurance regulators, changes in laws or regulations, and the Company’s ability to adapt to an evolving regulatory environment; (12) risks related to changes in the composition, valuation, or performance of the Company’s investment portfolio, including interest rate and foreign currency exchange rate fluctuations; (13) events or circumstances that result in the impairment of our intangible assets and/or goodwill that was recorded in connection with Octave’s acquisitions; (14) the risk of litigation, regulatory inquiries, investigations, claims or proceedings, and the risk of adverse outcomes in connection therewith; (15) system security risks, data protection breaches and cyber attacks; (16) our inability to attract and retain qualified executives, senior managers and other employees, or the loss of such personnel; (17) greater competition for our specialty property and casualty insurance business and/or our insurance distribution business; (18) loss or lowering of the AM Best rating for our property and casualty insurance company subsidiaries; (19) disintermediation within the insurance industry or greater competition from technology-based insurance solutions or non-traditional insurance markets; (20) changes in law or in the functioning of the healthcare market that impair the business model of our accident and health managing general agents; (21) failure to successfully execute business expansion initiatives, integrate acquired businesses, or realize anticipated benefits from such efforts and significant obligations under put rights granted in completed acquisitions; and (22) other risks and uncertainties that have not been identified at this time.


Source: Octave Specialty Group, Inc.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260223895676/en/
Karen Beyer

Managing Director, Investor Relations

(212) 208-3222

ir@octavegroup.com


Original: Octave Specialty Group Reports Fourth Quarter 2025 Results