Company: KG
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001628280-25-049606
Chunk: 275

Company: Kestrel Group Ltd
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 8
Chunk 275
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 Company’s business. These non-GAAP financial measures should not be viewed as a substitute for those determined in accordance with U.S. GAAP and are summarized in Key Financial Measures presented in the "Overview to Critical Accounting Policies" section.

Non-GAAP operating loss was $15.1 million for the three months ended September 30, 2025 compared to non-GAAP operating loss of $0.4 million for the same period in 2024. Non-GAAP operating loss was $12.0 million for the nine months ended September 30, 2025, compared to non-GAAP operating loss of $1.4 million for the nine months ended September 30, 2024. 

Non-GAAP Operating Return on Average Common Equity ("Non-GAAP Operating ROACE"): Management uses non-GAAP operating return on average common shareholders' equity as a measure of profitability that focuses on the return to common shareholders. It is calculated using non-GAAP operating income or loss available to common shareholders (as defined above) divided by average common shareholders' equity. 

Non-GAAP Operating ROACE for the three and nine months ended September 30, 2025 and 2024 was as follows:

For the Three Months Ended September 30,For the Nine Months Ended September 30,($ in thousands)2025202420252024Non-GAAP operating loss$(15,091)$(429)$(12,023)$(1,353)Opening adjusted shareholders’ equity150,086 4,913 4,606 5,837 Ending adjusted shareholders’ equity143,774 4,484 143,774 4,484 Average adjusted shareholders’ equity146,930 4,699 74,190 5,161 Non-GAAP Operating ROACE(40.7)%(36.3)%(21.7)%(35.0)% 

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The calculation, reconciliation to nearest GAAP measure and discussion of relevant non-GAAP measures used by management are as follows: 

For the Three Months Ended September 30,20252024($ in thousands except per share data)Net loss attributable to Kestrel common shareholders$(5,053)$(429)Add (subtract):Net realized and unrealized investment gains(5,494)— Foreign exchange and other gains(2,854)— Interest in loss of equity method investments24 —  Net loss from discontinued operations965 — Change in fair value of earn out consideration(2,679)—