Core Viewpoint - CBIZ, Inc. will announce its financial results for the first quarter of 2025 on April 24, 2025, before market opening [1] Group 1: Financial Results Announcement - The financial results for the first quarter ended March 31, 2025, will be disclosed before markets open on April 24, 2025 [1] - A conference call to discuss these results will be held on the same day at 11 a.m. (ET) [2] - The conference call will be available via live webcast on the CBIZ investor relations page [2] Group 2: Participation Details - Investors can register to receive the dial-in number and a unique personal identification number for the conference call [3] - Registration is open at any time, including up to and after the call start time [3] Group 3: Company Overview - CBIZ, Inc. is a leading professional services advisor to middle-market businesses across the United States [4] - The company specializes in accounting, tax, advisory, benefits, insurance, and technology services [4] - CBIZ employs over 10,000 team members in more than 160 locations across 22 major markets [4]

Core Insights - Investors prioritize companies with consistent profitability, measured effectively by net profit margin, which reflects operational efficiency and management quality [1][2] Group 1: Net Profit Margin - Net profit margin is calculated as Net Profit/Sales * 100, indicating a company's ability to convert sales into profits [2] - A strong net profit margin suggests effective cost control and operational strength, essential for attracting investors and rewarding stakeholders [2] - Companies with higher net profit margins compared to peers gain a competitive advantage [2] Group 2: Industry Variability - Net profit margin varies across industries, complicating direct comparisons, particularly between traditional and technology sectors [3] - Differences in accounting practices, such as treatment of non-cash expenses, further complicate comparisons [4] - Companies with high debt levels may report lower net profits due to interest expenses, limiting the metric's effectiveness [4] Group 3: Investment Strategy - A healthy net profit margin and solid earnings per share (EPS) growth are critical elements for a successful business model [5] - Screening parameters include a net margin of at least 0%, positive EPS growth, and favorable broker ratings [6] Group 4: Company Highlights - Sterling Infrastructure (STRL) operates in E-Infrastructure and has a Zacks Rank of 1 with a VGM Score of A; its 2025 earnings estimate was revised upward by 14% to $7.35 per share [7][8] - Kingstone Companies (KINS) provides property and casualty insurance, also holding a Zacks Rank of 1 and a VGM Score of A; its 2025 earnings estimate increased to $1.80 from $1.55 per share [9] - Meritage Hospitality (MHGU) focuses on restaurant operations, maintaining a Zacks Rank of 1 and a VGM Score of A; its 2025 earnings estimate rose to $1.36 from $1.12 per share [10][11] - CBIZ (CBZ) offers insurance and financial services, with a Zacks Rank of 1 and a VGM Score of B; its 2025 earnings estimate increased by 23% to $3.63 per share [11][12]

Group 1 - The core analysis of CBIZ, Inc. (NYSE: CBZ) indicates a Strong Buy rating based on historical growth and the strategic acquisition of Marcum LLP [1] - The acquisition of Marcum LLP is highlighted as a significant factor contributing to the positive outlook for CBIZ [1] Group 2 - Robert F. Abbott has been managing investments since 1995 and has experience with options trading since 2010, indicating a long-term investment strategy [1]

Revenue and Financial Performance - CBIZ's total revenue for the year ended December 31, 2024, was $1,813.5 million, representing a 13.9% increase from $1,591.2 million in 2023[38] - Revenue for fiscal year 2024 was $1,813.5 million, an increase of $222.3 million, or 14.0%, from $1,591.2 million in 2023[153] - Same-unit revenue increased by $76.9 million, or 4.8%, while acquisitions contributed $145.4 million, or 8.0% to total revenue[153] - Total revenue from Financial Services was $1,362.5 million, representing 75.1% of total revenue, up from $1,160.7 million, or 72.9% in 2023[161] - Total revenue for the Financial Services practice group grew by 17.4% to $1,362.5 million in 2024, with same-unit revenue increasing by 4.8%[175] - Benefits and Insurance Services practice group revenue increased by 4.8% to $401.0 million in 2024, with same-unit revenue up by 4.0%[177] Operating Expenses and Income - Operating expenses increased by $263.0 million to $1,631.0 million in 2024, with operating expenses as a percentage of revenue rising to 89.9%[164] - Operating income for 2024 was $73.7 million, with a gross margin of $182.5 million, reflecting a decrease from the previous year[163] - Personnel costs drove the increase in operating expenses, with a $194.5 million rise attributed to higher personnel costs in 2024[165] - G&A expenses increased by approximately $50.8 million, or 87.6%, in 2024, reaching $108.8 million, which is 6.0% of revenue compared to 3.6% in 2023[166] - Total operating expenses increased by $5.1 million, or 13.1%, in 2024 compared to 2023, primarily due to higher personnel costs[182] Acquisitions and Growth Strategy - The company completed five business acquisitions in 2024, including the acquisition of Marcum LLP, which is the largest transaction in its history[25][40] - The company acquired five businesses during 2024, including Marcum, as part of its growth strategy[97] - The acquisition of Marcum is expected to significantly increase the attest services received and the revenues generated under the existing Administrative Service Agreement with CBIZ CPAs[84] - Following the Attest Purchase, the number of SEC-reporting attest clients of CBIZ CPAs increased from very few or none to well over 100[87] Challenges and Risks - The company may face challenges in managing conflicts of interest and independence restrictions due to the significant increase in SEC-reporting attest clients[87] - The performance and benefits from the acquisition of Marcum may be adversely affected if the anticipated benefits are not realized or if unforeseen liabilities arise[81] - The company has identified certain material weaknesses in Marcum's internal control over financial reporting prior to the acquisition[95] - Changes in U.S. healthcare legislation may adversely affect revenue and margins in the company's healthcare benefit businesses[100] - Higher unemployment rates in the U.S. could lead to a reduction in employer-sponsored healthcare coverage, impacting commissions received[102] - Cybersecurity risks remain a concern, with past breaches highlighting vulnerabilities in the company's systems[105] Human Capital and Employee Engagement - CBIZ has over 10,000 team members nationwide, emphasizing the importance of human capital for delivering multi-disciplinary and technology-enabled solutions[55] - The company received a record 106 workplace awards in 2024, highlighting its commitment to attracting and retaining top talent[26] - The company focuses on a recruitment strategy that includes targeted campus recruiting and a robust internship program to build a strong talent pipeline[56] - CBIZ's centralized recruitment team utilizes best practices and various tools to source top talent, ensuring a consistent and fair hiring process[58] - The company prioritizes continuous learning and development, offering comprehensive training programs to prepare team members for future leadership roles[60] - CBIZ's commitment to human rights and diversity is reflected in its equal opportunity employment practices and the CBIZ Human Rights Policy[59] - The company has a strong focus on employee engagement, utilizing feedback from annual surveys to enhance talent initiatives and recognition programs[61] Financial Position and Capital Structure - As of December 31, 2024, the company has $1.4 billion in principal amount outstanding under its 2024 Credit Facilities, which consist of a $1.4 billion term loan and a $600 million revolving credit facility[117] - The company has approximately 53.3 million shares of common stock outstanding as of January 31, 2025, with 250 million shares authorized[124] - The stock consideration from the recent transaction is expected to constitute approximately 22% of the company's outstanding shares, potentially diluting current stockholders' ownership[126] - The company issued approximately 159,000 shares of common stock during the year ended December 31, 2024, as payment for acquisitions[144] - The company repurchased 1 share at an average price of $77.90 during December 2024, with a remaining capacity of 4,996 shares under the publicly announced repurchase plan[146] - The company's debt to EBITDA ratio has increased significantly following a recent transaction, raising concerns about its ability to service debt and pursue growth opportunities[121] Tax and Interest Expenses - Interest expense increased to $34.4 million in 2024 from $20.1 million in 2023, driven by a higher average debt balance and interest rate[169] - Income tax expense decreased to $16.8 million in 2024, with an effective tax rate of 29.0%, up from 27.3% in 2023[173] - The company's effective tax rate may vary significantly due to share-based compensation linked to stock price fluctuations[113] Cash Flow and Investment Activities - Net cash provided by operating activities was $123.7 million in 2024, down from $153.5 million in 2023, with net income of $41.0 million[189][190] - Net cash used in investing activities in 2024 was $1,129.3 million, primarily for business acquisitions, compared to $79.4 million in 2023[185][192] - Net cash provided by financing activities in 2024 was $1,035.6 million, mainly from the 2024 Credit Facilities, compared to a net cash used of $77.1 million in 2023[185][195] Market and Competitive Landscape - The company competes in a highly fragmented professional services industry, leveraging strong client relationships and data-driven expertise as competitive advantages[53] - The competitive landscape in the business services industry is fragmented, with significant competition from larger firms[112] - Rapid technological changes could impact the company's competitive position and client relationships[114]

Financial Data and Key Metrics Changes - Total revenue for Q4 2024 increased by 40.5%, with $108.9 million or a 33.2% increase attributed to the newly acquired Marcum operations [26] - For the full year 2024, total revenue was up 14%, with $108.9 million or a 6.8% increase attributed to Marcum [27] - Adjusted earnings per share for 2024 was $2.67, a 10.8% increase over the previous year's $2.41 [28] Business Line Data and Key Metrics Changes - Financial Services division saw growth across all major service lines, including Accounting & Tax, advisory, and Government Health Care Consulting [12] - Benefits and Insurance division also experienced strong growth, particularly in Employee Benefits and Retirement & Investment Services, with a noted outlier in Property & Casualty insurance due to producer departures [14] Market Data and Key Metrics Changes - Same-unit revenue for Financial Services was up 7.2% in Q4, while Benefits and Insurance saw a 3.8% increase [26] - For the full year, same-unit revenue for Financial Services was up 4.8%, and Benefits and Insurance was up 4.0% [27] Company Strategy and Development Direction - The acquisition of Marcum solidified the company's position as a leading provider of professional services to middle-market businesses, enhancing service offerings and market position [10] - The company plans to focus on integration activities in 2025, with expectations for organic revenue growth supplemented by strategic acquisitions [31][42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism regarding the operating environment in 2025, citing improved clarity on interest rates and economic conditions post-election [85] - The company anticipates a healthy level of organic growth driven by increased demand for discretionary project-oriented services [87] Other Important Information - The company completed two other strategic acquisitions and two tuck-in acquisitions in addition to the Marcum transaction [16] - Total debt at year-end 2024 was $1.42 billion, with approximately $550 million of unused capacity within a new $2 billion financing facility [36] Q&A Session Summary Question: Does the $3.60 to $3.65 adjusted EPS include an add-back of the tax-adjusted intangible amortization? - The amortization is added back, but it does not include the cash flow tax asset [62] Question: What is the expectation for Marcum's organic growth in 2025? - The expectation is for strong performance in 2025, mirroring the core accounting practice growth [81] Question: What areas or practices are most exciting for growth in 2025? - The company expects stronger organic growth in 2025, particularly in discretionary project-oriented services [85] Question: What is the pricing environment like for the combined CBIZ going forward? - The demand is expected to remain high, allowing for continued pricing ability [99] Question: Are there any particular industry verticals showing more activity? - The combined organization now has 10 industry groups with revenues over $100 million, enhancing growth opportunities [103]

Investor Presentation FULL YEAR 2024 Such forward-looking statements can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Many factors mentioned in "Item 1A. Risk Factors" of our most recent Annual Report on Form 10-K, as updated in subsequent filings with the SEC, will be important in determining future results. Should one or more of these risks or assumptions materialize, or should the underlying assumptions prove incorrect, actual results may vary materi ...

Revenue Performance - For Q4 2024, CBIZ reported revenue of $460.3 million, a 40.5% increase year-over-year, with 33.2% attributed to the acquisition of Marcum LLP[2] - For the full year 2024, total revenue reached $1,813.5 million, up $222.3 million or 14.0% from $1,591.2 million in 2023, with a same-unit revenue increase of 4.8%[3] - Revenue for the three months ended December 31, 2024, was $460,279 thousand, a 40.4% increase from $327,547 thousand in 2023[27] - For the twelve months ended December 31, 2024, total revenue reached $1,813,472 thousand, up from $1,591,194 thousand in 2023, marking a 13.9% year-over-year growth[32] - Financial Services revenue for the three months ended December 31, 2024, was $358,381 thousand, a 57.0% increase from $228,298 thousand in 2023[38] Earnings and Profitability - Adjusted EPS for 2024 was $2.67, reflecting a 10.8% increase compared to the previous year, while GAAP EPS was $0.78[4] - Adjusted diluted EPS for the twelve months ended December 31, 2024, was $2.67, compared to $2.41 in 2023, indicating an increase in adjusted earnings per share[32] - The company reported a diluted loss per share of $1.53 for the three months ended December 31, 2024, compared to a loss of $0.26 per share in 2023[27] - Net income for the twelve months ended December 31, 2024, was $41,038,000, a decrease of 66% compared to $120,968,000 in 2023[42] - The company provided guidance for full year 2025 GAAP net income between $127.9 million and $131.1 million, with diluted EPS expected to be between $1.97 and $2.02[50] Expenses and Losses - Operating expenses for the same period rose to $522,179 thousand, representing 113.4% of revenue, compared to 104.1% in 2023[27] - The operating loss for the three months ended December 31, 2024, was $106,665 thousand, compared to a loss of $26,735 thousand in 2023, highlighting a worsening operational performance[27] - Interest expense for the twelve months ended December 31, 2024, increased to $34,379 thousand from $20,131 thousand in 2023, reflecting higher borrowing costs[32] Debt and Financial Position - As of December 31, 2024, CBIZ had $1,420.9 million in outstanding debt with $556.0 million of unused borrowing capacity[5] - The company reported a total long-term debt of $1,333,755,000 in 2024, compared to $310,826,000 in 2023, indicating a substantial increase of 328%[44] - The company reported a debt to equity ratio of 78.6% in 2024, up from 39.3% in 2023, indicating increased leverage[44] Cash Flow and Assets - Net cash provided by operating activities decreased to $123,692,000 in 2024 from $153,507,000 in 2023, reflecting a decline of approximately 19%[42] - Cash and cash equivalents at the end of the period increased to $187,170,000 in 2024 from $157,148,000 in 2023, marking an increase of 19%[42] - Total assets increased significantly to $4,470,883,000 in 2024, up from $2,043,592,000 in 2023, representing an increase of 118%[44] Future Guidance and Projections - The company expects total revenue for 2025 to be in the range of $2.90 billion to $2.95 billion, with adjusted EBITDA projected between $450 million and $456 million[11] - CBIZ aims to leverage the Marcum acquisition to enhance its service offerings and expand its market presence in 2025[6] - The company has a weighted average fully diluted share count projected to be between 64.5 million and 65.0 million shares for 2025[11] - Adjusted EBITDA for 2025 is projected to be between $450.4 million and $456.2 million[50] Operational Efficiency - Same-unit revenue growth for Q4 2024 was 6.4%, while for the full year, it was 4.8% excluding the impact of the Marcum acquisition[6] - Days sales outstanding (DSO) improved to 73 days in 2024 from 78 days in 2023, indicating better efficiency in collecting receivables[44]

Fourth-Quarter Highlights - CBIZ reported fourth-quarter revenue of $460.3 million, a 40.5% increase compared to the same period in 2023, with 33.2% attributed to the acquisition of Marcum LLP [2] - Same-unit revenue increased by 6.4% in the fourth quarter [6] Full-Year Highlights - For the full year ended December 31, 2024, CBIZ recorded revenue of $1,813.5 million, a 14.0% increase from $1,591.2 million in 2023, with 6.8% attributed to the Marcum acquisition [3] - Adjusted earnings per share for the full year was $2.67, reflecting a 10.8% increase compared to 2023 [4] 2025 Outlook - The company anticipates total revenue for 2025 to be in the range of $2.90 billion to $2.95 billion, with GAAP EPS projected between $1.97 and $2.02 per diluted share [10] - Adjusted EPS is expected to be between $3.60 and $3.65 per diluted share, with adjusted EBITDA projected between $450 million and $456 million [10][34] Acquisition Impact - The acquisition of Marcum LLP, completed on November 1, 2024, is the largest in the company's history and has significantly impacted revenue growth and operational scale [2][6] - The company entered into a new $2.0 billion credit facility in connection with the acquisition, with outstanding indebtedness of $1,420.9 million as of December 31, 2024 [5] Financial Performance - The company reported a net loss of $90.7 million for the fourth quarter, with a diluted loss per share of $1.53 [19] - For the full year, net income was $41.0 million, translating to a diluted income per share of $0.78 [21] Segment Performance - Financial Services revenue for the fourth quarter was $358.4 million, up from $228.3 million in 2023, while Benefits and Insurance Services revenue was $91.2 million, compared to $86.4 million in the prior year [23] - The gross margin for Financial Services showed a loss of $66.2 million in the fourth quarter, influenced by integration costs related to the Marcum acquisition [23] Cash Flow and Financial Position - Net cash provided by operating activities for the year was $123.7 million, down from $153.5 million in 2023 [25] - Total assets increased to $4.47 billion as of December 31, 2024, compared to $2.04 billion in 2023, reflecting the impact of the Marcum acquisition [27] Debt and Equity - The company's debt-to-equity ratio increased to 78.6% as of December 31, 2024, compared to 39.3% in the previous year, indicating a higher leverage following the acquisition [27] - The total stockholders' equity rose to $1.78 billion from $791.6 million in 2023 [27]

Core Viewpoint - CBIZ, Inc. will announce its financial results for Q4 and the full year of 2024 on February 26, 2025, before market opening [1] Group 1: Financial Results Announcement - The financial results will be disclosed before markets open on February 26, 2025 [1] - A conference call to discuss the results will be hosted by the President and CEO Jerry Grisko and CFO Ware Grove at 11 a.m. (ET) on the same day [2] - The conference call will be available via live webcast on the investor relations page of the CBIZ website, with an archived replay accessible afterward [2] Group 2: Investor Participation - Investors can register online to receive the dial-in number and a unique personal identification number for the conference call [3] - Registration is open at any time, including up to and after the call start time [3] Group 3: Company Overview - CBIZ, Inc. is a leading professional services advisor to middle market businesses and organizations across the U.S. [4] - The company has over 10,000 team members in more than 160 locations across 22 major markets [4] - CBIZ specializes in accounting, tax, advisory, benefits, insurance, and technology services, providing insights and solutions to help clients grow [4]

Core Insights - 53.2% of CEOs express strong concern over the financial impact of tariffs, prompting significant operational changes [2][4] - The survey indicates a rebound in CEO optimism, with 45.0% rating their outlook as highly positive in December, up from 34.5% in September [3] - Economic concerns remain the top issue for CEOs, cited by 55.1%, followed by talent availability at 37.5% and increasing cybersecurity concerns [6] Tariff Impact - 80.9% of CEOs are considering relocating production to mitigate tariff-related costs [4] - 75.4% may reduce their workforce, while 72.3% plan to delay investments [4] - 66.4% are exploring new supplier options, and 50.0% are contemplating price increases [4] Tax Policy Perspectives - 42.6% of CEOs reported moderate benefits from the Tax Cuts and Jobs Act (TCJA), with 51.9% anticipating positive effects if TCJA provisions are extended [5] - 43.3% have benefited from the Inflation Reduction Act (IRA), but nearly half (47.7%) reported no tangible gains [5] Survey Methodology - The CBIZ-Hofstra Survey polled 256 mid-market CEOs and leaders from companies with revenues ranging from $5 million to over $1 billion, conducted the week of December 9, 2023 [8]