Company: AXS-PE
Filing Date: 2025-10-29
Form Type: 10-Q
Source: 0001214816-25-000181
Chunk: 141

Company: AXIS CAPITAL HOLDINGS LTD
Filing Date: 2025-10-29
Form: 10-Q
Item: Item 2
Chunk 141
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 end of the period.

(2)Annualized operating return on average common equity ("operating ROACE") is a non-GAAP financial measure as defined in Item 10(e) of SEC Regulation S-K. The reconciliation to the most comparable GAAP financial measure, annualized ROACE, and a discussion of the rationale for its presentation is provided in 'Management's Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures Reconciliation'.

(3)Book value per diluted common share represents total common shareholders’ equity divided by the number of diluted common share outstanding, determined using the treasury stock method. 

Return on Average Common Equity and Operating Return on Average Common Equity

Our objective is to generate superior returns on capital that appropriately reward common shareholders for the risks we assume and to grow revenue only when we expect the returns will meet or exceed our requirements. We recognize that the nature of underwriting cycles and the frequency or severity of large loss events in any one year may challenge the ability to achieve a profitability target in any specific period. 

ROACE reflects the impact of net income (loss) available (attributable) to common shareholders, including net investment gains (losses), foreign exchange losses (gains), reorganization expenses, interest in income (loss) of equity method investments and Bermuda net deferred tax asset.

The increase in ROACE for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, was primarily driven by foreign exchange gains, an increase in underwriting income and a decrease in corporate expenses, partially offset by increases in income tax expense and average common shareholders' equity and a decrease in net investment income.

The decrease in ROACE for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024, was primarily driven by income tax expense, increases in foreign exchange losses and average common shareholders' equity, and a decrease in interest in income of equity method investments, partially offset by increases in underwriting income and net investment income and net investment gains together with a decrease in reorganization expenses.

Operating ROACE excludes the impact of net investment gains (losses), foreign exchange losses (gains), reorganization expenses, interest in income (loss) of equity method investments and Bermuda net deferred tax asset.

The increase in operating ROACE for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, was primarily driven by an