Fairfax Financial Holdings Limited: Financial Results For The Year Ended December 31, 2025

Executive Summary

• Fairfax Financial reported record FY 2025 net earnings of $4.77 billion ($213.78 per diluted share), up 23% YoY.
• Underwriting profit hit a new high of $1.82 billion on a consolidated undiscounted combined ratio of 93.0%, with gross premiums written reaching $33.3 billion.
• Investment performance was strong, delivering net gains on investments of $3.15 billion (primarily equity gains).
• The company repurchased 1,006,535 subordinate voting shares for cash consideration of $1.6 billion and announced a forthcoming conference call on Feb 20, 2026.

Key Details

• Net Earnings: $4,772.4 M (shareholders) vs. $3,874.9 M in 2024; net earnings per diluted share $213.78 vs. $160.56.
• Book Value per Share: $1,260.19 (up 20.5% YoY, adjusted for Q1 dividend).
• Underwriting Profit: $1,816.6 M (record) on a consolidated undiscounted combined ratio of 93.0%; prior year 92.7% / $1,791.4 M.
• Premiums: Gross premiums written $33.3 B (+2.3% YoY); net premiums written $26.3 B (+3.9%).
• Investment Gains: Net gains on investments $3,151.4 M (equity exposures +$3,050.1 M; bonds +$385.4 M).
• Interest & Dividends Income: $2,574.0 M (up from $2,511.9 M).
• Catastrophe Losses: $1,242.1 M in 2025 vs. $1,099.3 M in 2024; combined‑ratio impact +4.8 points.
• Float: Increased 11.2% to $39.3 B at year‑end.
• Life & Run‑off Segment: Operating loss of $213.7 M (worse than $92.1 M in 2024).
• Non‑Insurance Companies: Operating income $397.4 M (up from $241.4 M) – driven by acquisition of Sleep Country and consolidation of Peak Achievement.
• Debt/Capital Ratio (excl. non‑insurance): 26.2% at Dec 31, 2025 vs. 24.8% in 2024.
• Share Repurchase: Purchased 1,006,535 subordinate voting shares for $1.6 B ($1,614.69 per share). Additional 130,573 shares later repurchased for $220.0 M ($1,684.70 per share).
• Capital Structure: Common shares outstanding reduced to 20,856,086 (‑3.7% YoY).
• Future Transactions:
• AGT IPO/secondary offering – Fairfax expected to hold ~51–53% post‑offering.
• Merger agreement to acquire Kennedy Wilson (all‑cash) with up to $1.65 B funding commitment; closing anticipated Q2 2026.

Notable Quotes

• Prem Watsa, Chairman & CEO: “2025 was the best year in our history… reflecting record underwriting profit and interest and dividends, continued strong contributions from our share of profit of associates and non‑insurance companies and very strong net gains on investments.”

Materiality Assessment: Material – Positive (record earnings, underwriting profit, strong investment performance, and significant strategic transactions).