Slide Insurance (SLDE) Q3 2026 Earnings Call: Net Income Rises, Guidance Raised

Slide Insurance (SLDE) reported strong third-quarter 2026 premium and earnings growth, supported by voluntary new business, geographic expansion and operating leverage. Management also raised full-year guidance despite incorporating expected losses from Hurricane Isaias.

Key Takeaways

• Gross written premiums increased 9.3% year over year to $506.5 million, driven by voluntary new business, expansion into new states and policy retention.
• Net income rose 24.5% to $138.2 million, while diluted earnings per share reached $1.09. Quarterly return on equity was approximately 11%, or about 44% annualized.
• The reported combined ratio was 59.3%, including $34.2 million of catastrophe losses. The accident-year combined ratio excluding catastrophes and prior-period reserve development improved to 54.4% from 62.3%.
• Management raised 2026 gross written premium guidance to $1.90 billion-$1.95 billion and net income guidance to $500 million-$520 million.
• The board approved a special cash dividend of $1.50 per share in addition to the regular quarterly dividend of $0.07 per share.
• California continued to ramp following its May launch, Texas began writing residential business, and New York and New Jersey remained targeted for rollout in the coming quarter.

Core Financial Data

As of September 30, 2026, Slide held $700.6 million of cash and cash equivalents and $849.8 million of total invested assets, primarily available-for-sale fixed-maturity securities.

Business and Operating Performance

Premium growth reflected sustained voluntary sales, policy retention and early contributions from expansion markets. California’s residential property excess and surplus lines program continued to scale after launching in May. Slide also began writing residential business in Texas during the quarter.

Management said New York and New Jersey remained on track for rollout in the coming quarter, although regulatory timing could affect the pace of expansion. The company expects growth from new markets to become more pronounced as distribution and regulatory approvals ramp.

Operating leverage remained a key earnings driver. General and administrative expenses increased modestly to $48.8 million from $45.0 million despite investments in personnel and infrastructure. Management attributed the lower expense ratio to earlier technology and staffing investments supporting the multistate expansion.

In October, Slide closed a $1.07 billion credit facility. Management said the facility provides flexibility for general corporate purposes, growth outside Florida and potential strategic M&A.

Management Guidance

Slide raised the lower end of its full-year 2026 gross written premium outlook:

• Gross written premiums: $1.90 billion-$1.95 billion, revised from $1.85 billion-$1.95 billion.
• Net income: $500 million-$520 million, revised from $455 million-$470 million.
• Full-year ROE: Management expects above 40%.
• Expense ratio: Management indicated approximately 28.5%-29% as an appropriate full-year run rate.
• Effective tax rate: Management expects approximately 21.5%-22% on a sustainable basis under its current tax strategy.

The net income outlook includes up to $50 million of expected pretax losses from Hurricane Isaias.

For 2027, management offered a preliminary expectation of at least 8%-9% premium growth, with additional potential from new territories. It cautioned that growth will likely be weighted toward the second half because of regulatory ramp-up periods and reinsurance capacity planning.

Risks and Watchpoints

Hurricane Isaias made landfall near the Florida-Alabama state line as a Category 2 storm. Slide has limited concentration in the Florida Panhandle, but management conservatively estimated approximately $50 million of pretax losses. The company emphasized that the estimate remains preliminary and could ultimately be lower.

Catastrophe losses already affected third-quarter underwriting results, with Florida convective storms adding 10.3 percentage points to the catastrophe loss ratio.

Management also identified regulatory approval timing as a constraint on the pace of new-state expansion. Growth projections must be coordinated with catastrophe reinsurance purchased early in the year, as exceeding submitted exposure projections can result in costly true-ups.

Potential M&A remains dependent on valuation discipline. Management said it has observed increased transaction activity but would proceed only at an acceptable price.

Analyst Q&A Highlights

• Hurricane exposure: Management described the $50 million Hurricane Isaias estimate as conservative because the storm affected a relatively low-population area where Slide has limited concentration. It does not expect a loss to its reinsurance panel.
• Use of credit capacity: The new facility may support general corporate purposes, expansion outside Florida and strategic acquisitions. Management said a potentially transformative transaction could emerge in 2027, subject to price discipline.
• Expense leverage: Slide expects prior technology and staffing investments to support further scale. Management views an expense ratio near 28.5%-29% as a reasonable run rate.
• 2027 growth cadence: Management expects premium growth to be back-end weighted as new states ramp and reinsurance allocations are established.
• Competition: Management said it has not observed outsized competitive pressure or material changes over the past two to three quarters and remains constructive on opportunities in Florida and expansion markets.
• Capital returns: Since its June 2025 IPO, Slide has returned approximately $423.1 million to shareholders, including $230.9 million of share repurchases and about $192.2 million of dividends.

Full Earnings Call Transcript

Complete Earnings Call Transcript

Management Remarks

Operator

Greetings, and welcome to the Slide Insurance Third Quarter 2026 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. I will now turn it over to Slide.

Unknown Executive

Thank you, and good morning. With us today are your host, Bruce Lucas, Chairman and Chief Executive Officer of Slide; and Anastasios Omiridis, Chief Financial Officer. By now, everyone should have access to our earnings release, which was published yesterday after the market closed and can be found on our website at ir.slideinsurance.com. Before we begin our formal remarks, I need to remind everyone that part of our discussion today may include forward-looking statements, which are based on the expectations, estimates and projections of management regarding the company's future performance, anticipated events or trends and other matters that are not historical facts.

The forward-looking statements in our discussion are subject to various assumptions, risks, uncertainties and other factors that are difficult to predict and which could cause actual results to differ materially from those expressed or implied in the forward-looking statements. These statements are not guarantees of future performance, and therefore, undue reliance should not be placed upon them. We refer all of you to our earnings release and recent filings with the SEC for a more detailed discussion of the risks and uncertainties that could impact the future operating results and financial condition of Slide.

Our statements are as of today, October 28, 2026, and we undertake no obligation to update any forward-looking statements we may make, except as required by law. In addition, this call is being webcast and an archived version will be available shortly after the call ends on the Investor Relations portion of the company's website at www.slideinsurance.com.

With that, I'd now like to turn the call over to our Founder, Chairman and CEO, Bruce Lucas. Please go ahead.

Bruce Lucas

Thank you, and welcome to our third quarter 2026 earnings call. Once again, we executed at a high level this quarter, reinforcing the strength of our tech-enabled model and its ability to produce industry-leading top and bottom line results. For the quarter, we grew gross written premiums by 9.3% year-over-year to $506.6 million, driven by continued growth in voluntary sales and the early contributions from our expansion markets. In addition to our top line growth, Slide grew net income by 25% year-over-year to $138.2 million with diluted earnings per share of $1.09.

Third quarter return on equity was approximately 11%, which equates to an approximate annualized return of 44%. Our combined ratio was 59.3%, reflecting continued underwriting discipline even with catastrophe losses. On an accident year ex catastrophe basis, our combined ratio was an outstanding 54.4%. Our third quarter results provide further testament to our ability to deliver meaningful value creation to our shareholders. We continue to make meaningful progress in expanding our footprint. California continues to ramp up following our May launch of the residential property E&S program, and we expect to accelerate growth there through the remainder of the year and into 2027.

We also began writing residential business in Texas this quarter and remain on track to roll out New York and New Jersey in the coming quarter. Our expansion outside of Florida further reflects the scalability of our platform and our ability to identify and act on attractive opportunities where we believe we can produce significant growth, coupled with attractive returns. We remain confident in our ability to execute on our diversified growth strategy, creating long-term value for our shareholders. We have built our program around one of the strongest balance sheets in the sector, giving us the financial flexibility to pursue this kind of expansion.

In October, we closed a $1.07 billion credit facility, the largest facility ever issued to a coastal property insurer, which further enhances our capital flexibility to fund accretive growth opportunities. We see a shift in the market taking place and are excited about the ability to move quickly should the right opportunity arise. Turning to capital management. We continued our disciplined approach to returning capital to shareholders. In addition to our regular quarterly cash dividend of $0.07 per share, I am pleased to announce that our Board of Directors has approved a special cash dividend of $1.50 per share.

This decision reflects the consistency and durability of our earnings power, the strength of our free cash flow generation and the robust capital position we have built. The special dividend complements our share repurchase program and regular dividend, underscoring our confidence in the long-term trajectory of the business. There are several reasons why I believe a special dividend is warranted at this time. First and foremost, I have a high degree of confidence in our business model and growth initiatives. Slide's ability to generate net income and free cash flow is unmatched in the coastal specialty market, and I believe that we will continue to be the market leader for the foreseeable future.

The Board has carefully reached the decision to issue a special dividend because the company continues to outperform virtually every financial metric, generating capital in excess of what is needed to fund our growth initiatives. I am always looking for ways to enhance shareholder return. And to date, that has been in the form of share repurchases and dividends. Since our IPO in June of 2025, Slide has returned approximately $423.1 million in capital to our shareholders. Slide repurchased $230.9 million of stock at an average weighted price of $17.28 a share, which equates to an approximate return on investment of 56.8%. Slide has also paid approximately $192.2 million in dividends, which translates to a yield in excess of 5%.

We will continue to use our capital thoughtfully to enhance future shareholder returns, and I strongly believe that both of our initiatives are accretive to our forward ROE. In the fourth quarter, Hurricane Isaias made landfall near the Florida, Alabama state line as a Category 2 hurricane. Our thoughts are with all of our impacted policyholders, and we are here for them in their time of need. Slide is not heavily concentrated in the Florida Panhandle, and we do not expect the storm to generate significant retention losses. It is too early to state the exact dollar amount of the retention, but we believe the hurricane will result in approximately $50 million of pretax retention.

Despite the hurricane, we believe Slide will end the year with over $500 million of net income, which translates into an annual ROE in excess of 40% for 2026, marking the fourth consecutive year of annual ROEs above 40%. Finally, our results this quarter reflect the dedicated work of our entire team. I want to thank all of our employees for their relentless effort and the important role they play in Slide's performance. I'm proud of what we're accomplishing together, and I appreciate all of you. Thank you for your continued support of Slide.

And with that, I'll now turn the call over to Anastasios Omiridis to provide some color on our third quarter results.

Anastasios Omiridis

Thank you, Bruce, and good morning, everyone. For the third quarter, net income increased 24.5% to $138.2 million compared with $111 million in the prior year period, resulting in diluted earnings per share of $1.09. Our results demonstrate the continued strength of our earnings profile supported by sustained top line growth and disciplined expense management. Gross written premiums increased 9.3% to $506.5 million compared with $463.4 million in the third quarter of 2025. Growth was driven by continued momentum in voluntary new business, including expansion into new states as well as policy retention.

Total revenue increased 35.9% to $361.1 million compared with $265.7 million in the prior year period. Net premiums earned grew 37.1% to $333.3 million compared with $243.1 million, reflecting the continued earning of premiums generated by our expanding portfolio. As a reminder, the quarterly progression of net premiums earned is not necessarily linear given the timing and volume of Citizens takeouts completed in prior periods and their respective positions within the policy earning cycle. Turning to our underwriting performance. Net losses and loss adjustment expenses totaled $101.3 million during the quarter, including $34.2 million of catastrophe losses associated with convective storms in Florida.

These losses represented 10.3% catastrophe loss ratio compared with no catastrophe loss ratio in the prior year quarter. We also recognized $18 million of favorable prior period reserve development compared with $32.5 million in the prior year period. Importantly, our accident year loss ratio, excluding catastrophe losses and prior period reserve development, improved to 25.5% from 27.5% in the prior year quarter. This 200 basis point improvement reflects favorable underlying loss experience and the continued effectiveness of our disciplined underwriting approach. Policy acquisition and other underwriting expenses increased to $46.2 million compared with $36.4 million in the prior year period, primarily reflecting higher acquisition costs associated with our growth.

General and administrative expenses totaled $48.8 million compared with $45 million in the prior year quarter, primarily reflecting investments in personnel and infrastructure to support our continued growth and geographic expansion. Despite these investments, we continue to realize meaningful operating leverage as our platform scales. Our expense ratio improved to 28.9% compared with 34.8% in the prior year period, representing a 590 basis point improvement. Our reported combined ratio was 59.3% compared with 48.5% in the prior year quarter, primarily reflecting higher catastrophe losses, partially offset by improved operating leverage and lower underwriting loss experience.

More importantly, our accident year combined ratio, excluding catastrophe losses and prior period reserve development improved to 54.4% compared with 62.3% in the prior year period. Turning to our balance sheet and capital position. As of September 30, 2026, we held $700.6 million in cash and cash equivalents and $849.8 million in total invested assets, consisting primarily of available-for-sale fixed maturity securities. Our strong liquidity position and continued earnings generation provide substantial financial flexibility to support our strategic priorities. Turning to capital management. As Bruce mentioned, during the quarter, we successfully closed a $1.1 billion credit facility, replacing our previous credit agreement and significantly enhancing our financial flexibility.

This financing represents an important milestone in Slide's continued evolution, providing additional capacity to support strategic growth opportunities while further strengthening our capital management capabilities. Importantly, our capital management strategy remains balanced and disciplined. We are committed to delivering meaningful shareholder returns while maintaining the financial flexibility to pursue attractive organic and inorganic growth opportunities. Turning to our updated full year 2026 outlook. Given our strong year-to-date performance and continued momentum across the business, we are pleased to raise the lower end of our full year gross written premium guidance.

We now expect gross written premiums of $1.9 billion to $1.95 billion compared with our previous guidance of $1.85 billion to $1.95 billion. This upward revision reflects our confidence in the underlying trajectory of the business, with continued premium growth expected to be driven primarily by sustained organic expansion, including voluntary new business production, geographic diversification and ongoing execution of our growth strategy. We also now expect to deliver full year net income between $500 million and $520 million compared to our prior range between $455 million and $470 million, which will result in a full year return on equity above 40%. Our full year net income expectations are inclusive of up to $50 million of expected pretax losses related to Hurricane Isaias.

Thank you for your time. Operator, we now are ready to open the line for questions.

Operator

[Operator Instructions] The first question is from Alex Scott from Barclays.

Question-and-Answer Session

Unknown Analyst

This is [indiscernible] on for Alex. Maybe just first a question on the hurricane. Can you help us unpack the roughly $50 million of estimated pretax losses? What drove the magnitude of the loss? And how should we think about your underlying exposure?

Bruce Lucas

Yes, absolutely. So Isaias has set in a very low populated area of Florida. It's just east of the Alabama, Florida state line. We have a very small concentration up there. We do have some commercial residential business up there. We do have affected policyholders. It is way too early to understand the magnitude of the storm, but everything we do here is extremely conservative from a reserve philosophy. So we picked a very conservative $50 million pretax loss to just message the market. But at this time, it's impossible to tell if it's going to be $50 million or a number below that.

And then in terms of what drove the loss, I mean, it's a hurricane and houses get impacted and get damaged, and this is pretty routine in Florida. So this was a pretty minor one by all accounts. I don't think this is a real industry moving event. It was, I don't want to say a nothing burger, but it was, in terms of a hurricane, it was pretty miniscule.

Unknown Analyst

Okay. That's helpful. Can you discuss how you're thinking about the $1 billion or over $1 billion of available credit capacity? To what extent could that be for our organic growth versus capital deployment to shareholders or...

Bruce Lucas

Well, we could use the credit facility for just general corporate purposes. So it is designed to be very flexible. We can use it in a number of ways, but one of the primary reasons for the credit facility is to pursue ex Florida growth and potentially strategic M&A.

Operator

The next question is from Thomas McJoynt-Griffith from KBW.

Thomas Mcjoynt-Griffith

The first one is sort of a modeling one, and it's around the operating leverage on the expense side and specifically looking at the G&A line on the income statement, it looks like you guys got some nice operating leverage there in the third quarter with it coming down sequentially. I was surprised to see that quarter-over-quarter step-down and frankly, it being barely up year-over-year. Was there anything unusual in the third quarter? And going forward, would you expect that to continue to increase as you expand into other states and have some build-out costs associated with that?

Bruce Lucas

Yes. I mean I'll just say that we're extremely cost conscious on all of our spend here at Slide. I don't like to waste money. And so we run a pretty tight ship. In terms of the G&A ratio and the fact that it's coming down, it really reflects the fact that we invested in prior quarters into technology, our staffing, et cetera, for this multistate expansion. So some of those expenses kind of get front-loaded. And then as you grow your top line GWP, those numbers start to come down some. So it just kind of reflects the seasonality of where we are in the business cycle. As we go forward, I would think that this is a pretty consistent number. I don't know, Andy, if you have anything.

Anastasios Omiridis

Yes, I totally agree with Bruce. I think what you're seeing is the organization scale up. And as you know, there's always expenses that are front-loaded. We assume that as we achieve scale that we should start to flatten out the expense ratio. Therefore, it will be favorable moving forward. And I think we've given guidance as far as that. We assume to be around the 29%, maybe a 28.5% for the year, but I think that's the right run rate for us.

Thomas Mcjoynt-Griffith

Okay. Got it. And then as you started thinking about the top line growth opportunity into 2027, do you have some early sort of indications or milestones that you look for in terms of the size of your growth, both in Florida and on an ex Florida basis relative to your premium dollar size this year, which looks like it's going to be about $2 billion. What would be some considered sort of a good growth year in '27 relative to the size of the book this year?

Anastasios Omiridis

So I think consistent with this year, I think right now, if we look at where we're sitting today, we're roughly around 8% or 9%. I think with the new markets, we like to be conservative because we want to make sure that we deliver what we commit to. But I think at a minimum, we should see 8% to 9% and then probably layer something in for the new territories. But again, Tommy, the only thing with the new territories is the ramp-up time, which comes from the regulatory side. So sometimes ramp-up can take a little bit longer than expected. But I would assume probably an 8% to 9% growth rate for the next year as we're trending for this year.

Operator

[Operator Instructions] The next question is from Paul Newsome from Piper Sandler.

Jon Paul Newsome

Just a quick follow-up to that thought on growth next year. If you could maybe talk a little bit more about the time line that as we roll out these states, I would expect the 8% to 9% necessarily isn't quarter by quarter by quarter. Should we expect an acceleration of growth as we get through the year because of what's happening from a distribution perspective? And I think -- on top of that, maybe what's going on with some of those business [adaptations] too? So just obviously not quarter-by-quarter guidance, but just in general, how do you think that evolution will happen over the course of the year?

Anastasios Omiridis

So first of all, Paul, it's good to hear from you. So I would consider it to be more back-end loaded. So in other words, I think you'll see Q1 to be a fairly decent quarter. All the quarters are assumed as we're starting our planning process right now to be, and we can talk about it later after we're done our planning process. But when I look -- when we look at the 8% or 9%, it is back-end loaded next year because the quarters aren't linear. So I mean, as the states ramp up, we're waiting to hear about New York. New York will then require a bit of a ramp-up. So there's attributes that I just think it's more back-end loaded for next year.

Bruce Lucas

Yes. And you have to also remember that we're out in market buying our catastrophe reinsurance program. I mean, that actually starts for us early February. And so at that point, we have to give projections out to 9/30. And you don't want to blow through your projections. Reinsurers don't like it. It can be very expensive on a true-up. So we're going to have meaningful growth throughout the year that we're going to model into our projections. But there is a ramp-up cycle. There's a reinsurance allocation that has to be done. But I do think that if I were to say what half of the year is going to be more robust, it's probably second half.

Jon Paul Newsome

That makes sense. How sensitive are, you think, the growth expectations as well to the current market environment? Lots of conversation about competition, both in and out of Florida. And so any thoughts on what you think has happened with the competitive environment and how you're structuring your business around that?

Bruce Lucas

Sure. I mean there's competition everywhere. That just never seems to change. I've been doing this for about 15 years, I'm going to say there's always been robust competition everywhere I've launched a state. We're not seeing anything that's outsized or problematic or big headwinds. What we see is a tremendous amount of opportunity still. And as we launch new products, new states, we've done our research there, and the team has a lot of experience. We have a pretty good idea where our products are going to land and how competitive they're going to be. And we're pretty bullish on what we see. And as we expand our footprint out of Florida, we're picking up reinsurance synergies along the way that help fuel that expansion model. But right now, I'd say, we're pretty bullish. I'm not seeing anything that's really changed over the last 2, 3 quarters.

Operator

The next question is from Randy Binner from Texas Capital.

Randy Binner

Yes, the 8% to 9% seems better than expected. So glad to hear you're still competitive in the Florida market. Bruce, you said something in your comments about kind of a shift in the market and you also mentioned strategic M&A. Are those 2 things related? And can you elaborate on kind of what you're seeing with the shift in the market and obviously, a lot more flexibility with the new credit facility?

Bruce Lucas

Yes. I mean, I think the market shift that we're seeing is kind of driven by forward reinsurance price expectations. And I won't comment on what that will look like, but I don't think Isaias is going to move the needle on reinsurance pricing at all. For example, Slide will not even see a loss to our reinsurance panel. So I do think that, that is bullish for the future. It's bullish for growth. It allows us to take on more capacity on the underwriting side because our reinsurance costs aren't going to be in a place where they're volatile next year. That's one big one.

And then the other thing I'll note on the M&A and kind of part of our thinking around the credit facility is get it in place in case there's a good M&A transaction. We have seen an uptick in M&A activity. And so whether these are publicly traded, privately traded, we've seen it kind of across the board. And I do think that there is M&A activity out there that could be promising. But again, it comes down to the right price. I've done, I mean, arguably more M&A than anybody in the coastal specialty sector over my career, never done a bad deal, never lost money. So you have to be disciplined on the price side. And as long as that's there, I think that there is a good prospect for something transformative into 2027.

Randy Binner

Okay. Great. And then I just had a detailed question about the model or really your tax rate, and it was a little bit lower than we expected this quarter. I think we've been using kind of a mid-20% tax rate, 20% rather. Is that the right tax rate to use going forward? Is there going to be a true-up for this lower tax rate in the fourth quarter? Just curious how that is going to extend out more into '27?

Anastasios Omiridis

I think it's a great question, Randy. No, it is -- we have put together a tax strategy, and we do assume that our ETR was 24.5% when we started the year. It is now effectively around 21.5%. We assume that we'll stay around 21.5% to 22% with the tax strategy that we have put in place. So we consider that, and we're always going to strive to do better, but I think we can sustain the 21.5% to 22% ETR, effective tax rate moving forward.

Randy Binner

Okay. But was there a reason why it was lower in the current quarter?

Anastasios Omiridis

Well, it was the catch-up. So in other words, the 21.5% that we have right now in order to smooth out because, remember, taxes are year-to-date. It's a 14% for the quarter to true up, but 21.5% is the ETR year-to-date.

Randy Binner

Got it. Okay. Perfect.

Operator

There are no further questions at this time. I'd like to turn the floor back over to Bruce Lucas for closing comments.

Bruce Lucas

I would like to thank everyone for joining our third quarter 2026 earnings call.

Operator

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.