Fairfax Financial Holdings Limited reported an increase in net earnings for the second quarter of 2025 (Q2 2025), reaching US$1.44 billion, or US$61.61 per diluted share.
This result compares to US$915.4 million, or US$37.18 per diluted share, in the same period last year.
The company’s book value per basic share stood at US$1,158.47 as of June 30, 2025, up from US$1,059.60 at the end of 2024, after accounting for a Us$15 per share dividend paid in the first quarter (Q1 2025).
The company’s property and casualty (P&C) insurance and reinsurance operations produced adjusted operating income of US$1.13 billion for the quarter.
When including the benefit of discounting and risk adjustments, operating income was US$1.45 billion.
The combined ratio for these operations was 93.3%, with an underwriting profit of US$426.9 million before discounting.
Gross premiums written increased by 2.6% to US$9.18 billion, while net premiums written grew 4.8% to US$7.26 billion.
The company attributed these increases to new business in reinsurance and casualty lines, as well as higher retention rates.
Underwriting profit improved from US$370.4 million in the second quarter of 2024 to US$426.9 million in the current quarter.
The improvement in the combined ratio was supported by increased business volumes, favourable reserve development from prior years, and lower catastrophe losses compared to the previous year.
Fairfax reported net investment gains of US$952 million for the quarter, with US$800.4 million coming from common stock holdings.
The company’s fixed income portfolio was allocated primarily to US treasury and government bonds, which made up 70% of the total, and high-quality corporate bonds, which accounted for 19%.
Net gains on bonds totalled US$74.8 million, largely due to a decline in interest rates.
Other investment gains of US$76.8 million were mainly attributed to unrealized gains on digit compulsory convertible preferred shares, offset by losses on foreign currency contracts.
Interest and dividend income for the quarter was US$666.3 million, up from US$614 million in the prior year period.
As of June 30, 2025, the company’s insurance and reinsurance subsidiaries held US$67.8 billion in portfolio investments, including US$10 billion in cash and short-term investments.
Operating income from Fairfax’s non-insurance businesses rose to US$126 million, compared to US$25.2 million in the second quarter of 2024.
This growth was linked to the consolidation of Peak Achievement, the acquisition of Sleep Country, and increased income from Fairfax India.
During the quarter, Fairfax acquired a 33% stake in Albingia SA, a French specialty property and casualty insurer, for US$236.5 million.
The company also completed a US$900 million offering of unsecured senior notes and entered into an agreement to acquire all outstanding units of The Keg Royalties Income Fund not already owned for approximately US$151 million.
At the end of the quarter, Fairfax’s holding company held over US$3 billion in cash and marketable securities, along with US$1.9 billion in investments in associates and consolidated non-insurance companies.
The fair value of investments in non-insurance associates and subsidiaries exceeded carrying value by US$2.4 billion, an increase attributed to the higher market value of the company’s investment in Eurobank.
The company’s total debt to capital ratio, excluding non-insurance companies, was 25.9% as of June 30, 2025, up from 24.8% at the end of 2024.
The increase was due to new debt issuance and redemption of preferred shares, partially offset by higher common shareholders’ equity.
Fairfax extended the maturity of its US$2 billion unsecured revolving credit facility to July 16, 2030.
As of June 30, 2025, there were 21,591,832 common shares outstanding.
