0002002473false00020024732025-02-252025-02-25

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 25, 2025
Bowhead Specialty Holdings Inc.
(Exact name of registrant as specified in its charter)
Delaware
001-42111
87-1433334
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS Employer Identification No.)
452 Fifth Avenue
New York, New York 10018
(Address of principal executive offices)
(212) 970-0269
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
£    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
£    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
£    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
£    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $0.01 per shareBOWNew York Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 under the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 under the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company T
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. £



Item 2.02     Results of Operations and Financial Condition.
On February 25, 2025, Bowhead Specialty Holdings Inc. (the "Company") issued a press release announcing its financial results for the three months and twelve months ended December 31, 2024. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

Item 9.01.    Financial Statements and Exhibits.

(d) Exhibits.
Exhibit No. Description
99.1
104Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
2

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: February 25, 2025
By:/s/Brad Mulcahey
Name:Brad Mulcahey
Title:Chief Financial Officer and Treasurer


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Bowhead Specialty Holdings Inc. Reports Fourth Quarter 2024 Results

NEW YORK, New York. (BusinessWire) – Bowhead Specialty Holdings Inc. (NYSE: BOW), a specialty lines insurance group focused on providing casualty, professional liability and healthcare liability insurance products, today announced financial results for the fourth quarter ended December 31, 2024(1).

Fourth Quarter 2024 Highlights
•Gross written premiums increased 26.3% to $184.8 million.
•Net income of $13.6 million, or $0.41 per diluted share.
•Adjusted net income(2) of $14.1 million, or $0.42 per diluted share(2).
•Return on equity of 14.8% and adjusted return on equity(2) of 15.3%.
•Book value per share $11.34 and diluted book value per share of $11.03.

Full Year 2024 Highlights
•Gross written premiums increased 37.0% to $695.7 million.
•Net income of $38.2 million, or $1.29 per diluted share.
•Adjusted net income(2) of $42.7 million, or $1.44 per diluted share(2).
•Return on equity of 13.6% and adjusted return on equity(2) of 15.2%.

Bowhead Chief Executive Officer, Stephen Sills, commented, “After completing our fourth year of operations, we are once again incredibly proud of what we’ve accomplished. This milestone year as a new public company has been defined by profitable growth, continued innovation, and strong execution across all our underwriting divisions. Premiums grew 37% in the year driven by a 56% growth in our Casualty division and double-digit premium growth in our Healthcare Liability and Professional Liability divisions. Late in Q2, we launched Baleen, our tech-enabled low touch “flow” underwriting operation, which supplements our “craft” underwriting solution. We are pleased with our initial results and look forward to applying this technology in other areas of our business. As we look ahead into 2025, our focus is to build on the momentum we generated in 2024 and continue to grow our business profitably. This is just the beginning for Bowhead and I couldn’t be more excited for what I expect to be a company that is capable of cross cycle profitability.”

Underwriting Results

The 26.3% increase in gross written premiums to $184.8 million in the fourth quarter of 2024 was driven by renewals, new business and continued growth in our platform across all divisions:

•Our Casualty division led the growth with a 43.1% increase to $105.9 million;
•Healthcare Liability increased 8.8% to $31.7 million; and
•Professional Liability increased 6.5% to $46.0 million.
•Late in the second quarter of 2024, we launched a new division called Baleen Specialty, which focuses on small, hard-to-place risks written 100% on a non-admitted basis. Baleen is a streamlined, tech-enabled low touch “flow” underwriting operation that supplements the “craft” solutions we offer today. In line with our deliberate, measured and limited roll out, Baleen Specialty generated $1.2 million of gross written premiums for the fourth quarter of 2024, a sequential growth of 175% from the previous quarter.

Our loss ratio for the year of 64.4% increased 1.4 points compared to 63.0% in 2023 due to mix changes in the portfolio, where Casualty, which has higher current accident year industry loss ratios, comprised a larger proportion of our portfolio compared to 2023. There was no prior accident year reserve development in our loss ratio for the year.

During the quarter, as part of our annual independent actuarial reserve review, we reallocated prior accident year loss reserves by division, primarily from Professional Liability to Casualty, to align more closely with industry loss ratios. The increase in our loss ratio and reallocation of prior accident year reserves are primarily based on inputs from industry data due to Bowhead’s limited loss experience. As of December 31, 2024, incurred but not reported liabilities comprised 90.7% of our net loss reserves.


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Our expense ratio for the fourth quarter of 30.1% and for the year ended December 31, 2024 of 31.4%, decreased 1.2 points and 0.5 points, respectively, driven by the continued scaling of our business and prudent management of operating expenses.

Investment Results

Net investment income increased 79.8% in the quarter to $12.2 million and 107.1% for the year to $40.1 million, driven by the increase in our investment portfolio and higher yields on invested assets. Our investment portfolio had a had a book yield of 4.6% and a new money rate of 4.9% at the end of the year.

The weighted average effective duration of our investment portfolio, which included cash equivalents, was 2.2 years and had an average rating of “AA” at December 31, 2024.

__________________
(1)Comparisons in this release are made to December 31, 2023 financial results unless otherwise noted.
(2)Non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of the non-GAAP financial measures to their most directly comparable U.S. GAAP measures.



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Summary of Operating Results

The following table summarizes the Company’s results of operations for the three and twelve months ended December 31, 2024 and 2023:

Three Months Ended December 31,Twelve Months Ended December 31,
20242023% Change20242023% Change
($ in thousands, except percentages and per share data)
Gross written premiums$184,769$146,32126.3 %$695,717$507,68837.0 %
Ceded written premiums(64,585)(51,376)25.7 %(244,295)(173,016)41.2 %
Net written premiums $120,184$94,94526.6 %$451,422$334,67234.9 %
Revenues
Net earned premiums$106,864$75,99240.6 %$385,111$263,90245.9 %
Net investment income12,1936,78279.8 %40,12119,371107.1 %
Net realized investment losses——NM(16)—NM
Other insurance-related income27431783.9 %444125255.2 %
Total revenues 119,33182,80544.1 %425,660283,39850.2 %
Expenses
Net losses and loss adjustment expenses
66,93752,61827.2 %248,099166,28249.2 %
Net acquisition costs9,1305,78757.8 %32,39720,93554.8 %
Operating expenses23,35218,00129.7 %89,11263,45640.4 %
Non-operating expenses622630(1.3)%2,807630345.6 %
Warrant expense792—NM1,917—NM
Credit facility interest expenses and fees248—NM725—NM
Foreign exchange losses (gains)1(41)(102.4)%68(20)(440.0)%
Total expenses
101,08276,99531.3 %375,125251,28349.3 %
Income before income taxes18,2495,810214.1 %50,53532,11557.4 %
Income tax expense
(4,642)(1,027)352.0 %(12,292)(7,068)73.9 %
Net income
$13,607$4,783184.5 %$38,243$25,04752.7 %
Key Operating and Financial Metrics:
Adjusted net income(1)
$14,099$5,793143.4 %$42,686$26,15263.2 %
Loss ratio62.6 %69.2 %64.4 %63.0 %
Expense ratio30.1 %31.3 %31.4 %31.9 %
Combined ratio92.7 %100.5 %95.8 %94.9 %
Return on equity(2)
14.8 %11.0 %13.6 %18.2 %
Adjusted return on equity(1)(2)
15.3 %13.4 %15.2 %19.0 %
Diluted earnings per share$0.41$0.20$1.29$1.04
Diluted adjusted earnings per share(1)
$0.42$0.24$1.44$1.09
__________________
NM - Percentage change is not meaningful.
(1)Non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures” for a reconciliation of the non-GAAP financial measures to their most directly comparable U.S. GAAP measures.
(2)For the three months ended December 31, 2024 and 2023, net income and adjusted net income are annualized to arrive at return on equity and adjusted return on equity.





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Condensed Consolidated Balance Sheets

December 31,
2024		December 31, 2023
($ in thousands, except share data)
Assets
Investments
Fixed maturity securities, available for sale, at fair value (amortized cost of $894,145 and $569,013, respectively)
$879,989 $554,624 
Short-term investments, at amortized cost, which approximates fair value9,997 8,824 
Total investments
889,986 563,448 
Cash and cash equivalents97,476 118,070 
Restricted cash and cash equivalents124,582 1,698 
Accrued investment income7,520 4,660 
Premium balances receivable63,672 38,817 
Reinsurance recoverable255,072 139,389 
Prepaid reinsurance premiums152,567 116,732 
Deferred policy acquisition costs27,625 19,407 
Property and equipment, net6,845 7,601 
Income taxes receivable586 1,107 
Deferred tax assets, net20,340 14,229 
Other assets7,971 2,701 
Total assets
$1,654,242 $1,027,859 
Liabilities
Reserve for losses and loss adjustment expenses$756,859 $431,186 
Unearned premiums446,850 344,704 
Reinsurance balances payable51,856 40,440 
Income taxes payable1,571 42 
Accrued expenses18,010 14,900 
Other liabilities8,654 4,510 
Total liabilities
1,283,800 835,782 
Commitments and contingencies (Note 13)
Mezzanine equity
Performance stock units265 — 
Stockholders' equity
Common stock327 240 
($0.01 par value; 400,000,000 shares authorized, 32,662,683 and 24,000,000 shares issued and outstanding at December 31, 2024 and December 31, 2023, respectively)
Additional paid-in capital318,095 178,543 
Accumulated other comprehensive loss(11,154)(11,372)
Retained earnings62,909 24,666 
Total stockholders' equity370,177 192,077 
Total mezzanine equity and stockholders' equity370,442 192,077 
Total liabilities, mezzanine equity and stockholders' equity
$1,654,242 $1,027,859 


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Gross Written Premiums

The following tables present gross written premiums by underwriting division for the three and twelve months ended December 31, 2024 and 2023:

Three Months Ended December 31,
2024% of Total2023% of Total$ Change% Change
($ in thousands, except percentages)
Casualty$105,872 57.3 %$73,993 50.6 %$31,879 43.1 %
Professional Liability46,010 24.9 %43,195 29.5 %2,815 6.5 %
Healthcare Liability31,699 17.2 %29,133 19.9 %2,566 8.8 %
Baleen Specialty1,188 0.6 %— — %1,188 NM
Gross written premiums
$184,769 100.0 %$146,321 100.0 %$38,448 26.3 %

Twelve Months Ended December 31,
2024% of Total2023% of Total$ Change% Change
($ in thousands, except percentages)
Casualty$431,817 62.1 %$277,455 54.7 %$154,362 55.6 %
Professional Liability160,651 23.1 %145,251 28.6 %15,400 10.6 %
Healthcare Liability101,619 14.6 %84,982 16.7 %16,637 19.6 %
Baleen Specialty1,630 0.2 %— — %1,630 NM
Gross written premiums
$695,717 100.0 %$507,688 100.0 %$188,029 37.0 %

Loss Ratio

The following tables summarize current and prior accident year loss ratios for the three and twelve months ended December 31, 2024 and 2023:

Three Months Ended December 31,
20242023
Net Losses and Loss Adjustment Expenses% of Net Earned PremiumsNet Losses and Loss Adjustment Expenses% of Net Earned Premiums
($ in thousands, except percentages)
Current accident year$66,937 62.6 %$53,254 70.0 %
Prior accident year reserve development— — %(636)(0.8)%
Total$66,937 62.6 %$52,618 69.2 %

Twelve Months Ended December 31,
20242023
Net Losses and Loss Adjustment Expenses% of Net Earned PremiumsNet Losses and Loss Adjustment Expenses% of Net Earned Premiums
($ in thousands, except percentages)
Current accident year$248,099 64.4 %$166,282 63.0 %
Prior accident year reserve development— — %— — %
Total$248,099 64.4 %$166,282 63.0 %



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Expense Ratio

The following tables summarize the components of our expense ratio for the three and twelve months ended December 31, 2024 and 2023:

Three Months Ended December 31,
20242023
Expenses% of Net Earned PremiumsExpenses% of Net Earned Premiums
($ in thousands, except percentages)
Net acquisition costs$9,130 8.5 %$5,787 7.6 %
Operating expenses23,352 21.9 %18,001 23.7 %
Less: Other insurance-related income(274)(0.3)%(31)— %
Total expense ratio$32,208 30.1 %$23,757 31.3 %

Twelve Months Ended December 31,
20242023
Expenses% of Net Earned PremiumsExpenses% of Net Earned Premiums
($ in thousands, except percentages)
Net acquisition costs
$32,397 8.4 %$20,935 7.9 %
Operating expenses
89,112 23.1 %63,456 24.0 %
Less: Other insurance-related income(444)(0.1)%(125)— %
Total expense ratio
$121,065 31.4 %$— $84,266 31.9 %

Net Investment Income

The following table summarizes the sources of net investment income for the three and twelve months ended December 31, 2024 and 2023:

Three Months Ended December 31,Twelve Months Ended December 31,
2024202320242023
($ in thousands)
U.S. government and government agency$3,198 $2,511 $14,514 $4,673 
State and municipal591 387 1,832 1,550 
Commercial mortgage-backed securities981 378 2,584 1,381 
Residential mortgage-backed securities2,399 244 6,517 962 
Asset-backed securities1,283 1,171 3,043 3,708 
Corporate2,154 934 5,768 3,448 
Short-term investments130 126 480 943 
Cash and cash equivalents1,700 1,179 6,193 3,190 
Gross investment income12,436 6,930 40,931 19,855 
Investment expenses(243)(148)(810)(484)
Net investment income$12,193 $6,782 $40,121 $19,371 



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Reconciliation of Non-GAAP Financial Measures

This earnings release contains certain financial measures that are not presented in accordance with generally
accepted accounting principles in the United States (“U.S. GAAP”). We use these non-GAAP financial measures
when planning, monitoring and evaluating our performance. Management believes that each of the non-GAAP
financial measures described below provides useful insight into our underlying business performance.

•Adjusted net income is defined as net income excluding the impact of net realized investment losses, non-operating expenses, foreign exchange losses (gains), and certain strategic initiatives. Adjusted net income excludes the impact of certain items that may not be indicative of underlying business trends, operating results, or future outlook, net of tax impact. We calculate the tax impact only on adjustments that would be included in calculating our income tax expense using the estimated tax rate at which we received a deduction for these adjustments.

•Adjusted return on equity is defined as adjusted net income as a percentage of average beginning and ending mezzanine equity and stockholders’ equity.

•Diluted adjusted earnings per share is defined as adjusted net income divided by the weighted average common shares outstanding for the period, reflecting the dilution that may occur if equity based awards are converted into common stock equivalents as calculated using the treasury stock method.

You should not rely on these non-GAAP financial measures as a substitute for any U.S. GAAP financial measure.
While we believe that these non-GAAP financial measures are useful in evaluating our business, this information
should be considered supplemental in nature and not as a replacement for or superior to the comparable U.S. GAAP
measures. In addition, other companies, including companies in our industry, may calculate such measures
differently, which reduces their usefulness as comparative measures.

Adjusted net income

Adjusted net income for the three and twelve months ended December 31, 2024 and 2023 reconciles to net income as follows:

Three Months Ended December 31,
20242023
Before income taxesAfter income taxesBefore income taxesAfter income taxes
($ in thousands)
Income as reported$18,249 $13,607 $5,810 $4,783 
Adjustments:
Non-operating expenses622 622 630 630 
Foreign exchange losses (gains)1 1 (41)(41)
Strategic initiatives(1)
— — 706 706 
Tax impact— (131)— (285)
Adjusted net income$18,872 $14,099 $7,105 $5,793 



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Twelve Months Ended December 31,
20242023
Before income taxesAfter income taxesBefore income taxesAfter income taxes
($ in thousands)
Income as reported$50,535 $38,243 $32,115 $25,047 
Adjustments:
Net realized investment losses16 16 — — 
Non-operating expenses2,807 2,807 630 630 
Foreign exchange losses (gains)68 68 (20)(20)
Strategic initiatives(1)
2,733 2,733 806 806 
Tax impact— (1,181)— (311)
Adjusted net income$56,159 $42,686 $33,531 $26,152 
_________________
(1)Strategic initiatives for the three months and years ended December 31, 2024 and 2023 represents costs incurred to set up our Baleen Specialty division, which is recorded in operating expenses within the Consolidated Statements of Income and Comprehensive Income. The costs incurred primarily represent expenses to implement the new platform and processes supporting the Baleen Specialty division. See “Business— Our Business”

Adjusted return on equity

Adjusted return on equity for the three and twelve months ended December 31, 2024 and 2023 reconciles to return on equity as follows:

Three Months Ended December 31,Twelve Months Ended December 31,
2024202320242023
($ in thousands, except percentages)
Numerator: Adjusted net income(1)
$56,395$23,172$42,686$26,152
Denominator: Average mezzanine equity and stockholders' equity
367,467173,251281,259137,726
Adjusted return on equity 15.3 %13.4 %15.2 %19.0 %
_______________
(1)For the three months ended December 31, 2024 and 2023, net income and adjusted net income are annualized to arrive at return on equity and adjusted return on equity.

Diluted adjusted earnings per share

Diluted adjusted earnings per share for the three and twelve months ended December 31, 2024 and 2023 reconciles to diluted earnings per share as follows:

Three Months Ended December 31,Twelve Months Ended December 31,
2024202320242023
($ in thousands, except share and per share data)
Numerator: Adjusted net income$14,099 $5,793 $42,686 $26,152 
Denominator: Diluted weighted average shares outstanding33,571,53524,000,00029,677,19624,000,000
Diluted adjusted earnings per share$0.42 $0.24 $1.44 $1.09 




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About Bowhead Specialty Holdings Inc.

Bowhead Specialty is a specialty lines insurance group providing casualty, professional liability and healthcare liability insurance products. The team is composed of highly experienced and respected industry veterans with decades of individual, successful underwriting and management experience. We provide “craft” underwriting solutions, which require deep underwriting and claims expertise in order to produce attractive financial results. In May 2024, we supplemented our “craft” solution with our “flow” underwriting operation, which is a streamlined, tech-enabled low touch form of underwriting, focused on small, niche and hard-to-place risks. Our policies are primarily written on a non-admitted, or excess and surplus lines (“E&S”) basis, which is free of rate and policy form restrictions, and provides the flexibility to rapidly adjust to emerging market opportunities.

We pride ourselves on the quality and experience of our people, who are committed to exceeding our partners’ expectations through excellent service and expertise. Our collaborative culture spans all functions of our business, which allows us to provide a consistent, positive experience for all of our partners.

Conference Call

The Company will host a conference call to discuss its results today, Tuesday, February 25, 2025, beginning at 8:30 a.m. Eastern Time. Interested parties may access the conference call through a live webcast, which can be accessed via this link or by visiting the Company’s Investor Relations website. A dial-in option for listen-only participants will be available after registering for the call. Please join the live webcast or dial in at least 10 minutes before the start of the call.

A replay of the event webcast will be available on the company’s Investor Relations website for one year following the call.

Forward-Looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in press release are forward-looking statements. In some cases, forward-looking statements can be identified by terms such as "anticipates," "believes," "estimates," "expects," "intends," "plans," "predicts," "projects," "seeks," "future," "outlook," "prospects" "will," "would," "should," "could," "may," "can have" or similar words. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. These risks include those described in the Company’s filings made with the Securities and Exchange Commission. Forward-looking statements speak only as of the date of this press release and the Company does not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events or otherwise.

Investor Relations Contact:
Shirley Yap, Head of Investor Relations
investorrelations@bowheadspecialty.com

v3.25.0.1
Cover
Feb. 25, 2025
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 25, 2025
Registrant Name Bowhead Specialty Holdings Inc.
Entity Address, Address Line One 452 Fifth Avenue
Entity Address, City or Town New York
Entity Address, State or Province NY
Entity Address, Postal Zip Code 10018
Local Phone Number 970-0269
City Area Code 212
Entity File Number 001-42111
Entity Tax Identification Number 87-1433334
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, par value $0.01 per share
Entity Emerging Growth Company true
Entity Ex Transition Period false
Entity Incorporation, State or Country Code DE
Written Communications false
Trading Symbol BOW
Security Exchange Name NYSE
Central Index Key 0002002473
Amendment Flag false
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