Core Viewpoint - TWFG, Inc. is set to release its financial results for the second quarter of 2025 on August 12, 2025, with a conference call scheduled for the following morning to discuss these results [1]. Company Overview - TWFG, Inc. is a leading independent insurance distribution platform that offers innovative and personalized insurance solutions to individuals and businesses across the United States [3]. - The company emphasizes service, professionalism, and an entrepreneurial spirit, empowering its extensive network of agents to provide client-focused insurance options across various personal and commercial lines [3]. Investor Relations - Participants can register for the conference call via a provided link to receive dial-in details, and a live webcast will be available on TWFG's Investor Relations website [2]. - Interested parties are encouraged to access the webcast at least 10 minutes before the scheduled start time, and a replay will be available for a limited time after the call [2].

Summary of TWFG Conference Call - June 11, 2025 Company Overview - **Company**: TWFG (The Woodlands Financial Group) - **Industry**: Insurance, specifically focusing on personal lines and independent agency distribution Key Points and Arguments Market Conditions and Growth Opportunities - Post-IPO, the market has reacted positively to TWFG, with favorable conditions observed except for a challenging week in April [3][4] - The personal lines insurance market is seen as a consolidation opportunity, with a potential market size of half a trillion dollars [5][6] - The company anticipates organic revenue growth of 12-16% and an adjusted EBITDA margin of 20-22% for 2025, driven by improved market conditions and new business incentives [7][8] Competitive Landscape - The competitive environment for private passenger auto insurance is rated at 7.5 out of 10, indicating a competitive market, while homeowners insurance is rated at 2.5 to 3, suggesting room for improvement [19][22] - Direct-to-consumer (DTC) channels like GEICO and Progressive are not seen as threats to independent agents; instead, collaboration is expected to continue [15][16] Distribution Model - The shift from captive agency models to independent agency models is noted, with independent agents now capturing a significant share of the market [16][28] - TWFG's "agency in a box" model is highlighted as a strategic advantage, providing comprehensive support to agents [31][34] Retention and Profitability - Agents retain 100% of the profits generated from their local operations, incentivizing them to grow their businesses within the TWFG framework [38][41] - The company emphasizes the importance of retention and productivity, which are expected to drive future growth [40][41] Expansion Strategy - TWFG is expanding into new states, focusing on recruiting talent and acquiring portfolios to strengthen its market position [42][43] - The company has successfully entered markets like Ohio and North Carolina through acquisitions and organic growth [43][44] M&A Strategy - M&A is viewed as an enhancement rather than a necessity for TWFG's operations, allowing for additional growth opportunities [60][61] - The company aims to be selective in M&A activities, focusing on acquiring businesses that can provide synergistic benefits [62][63] Technology Investments - Significant investments in technology are being made to improve operational efficiency and support agency growth [70][78] - The company is exploring AI applications to enhance workflows and improve productivity across its network [71][72] MGA Programs - TWFG has been successful in its MGA programs, particularly in challenging markets, and plans to expand these offerings [55][56] Additional Important Insights - The company has a unique position in the market due to its ability to bundle insurance products, which is a competitive advantage over DTC platforms [23][26] - The fragmented nature of the homeowners insurance market makes it less likely for independent agents to be displaced by DTC offerings [17][18] - TWFG's focus on scalable technology investments is expected to yield compounding benefits across its operations [78][81]

Core Insights - TWFG, Inc. is a high-growth insurance distribution company that will have its Founder and CEO, Gordy Bunch, participate in a fireside chat at the Morgan Stanley US Financials Conference on June 11, 2025 [1] - A live webcast of the conference will be available, along with a replay on the company's website [1] Company Overview - TWFG is a leading independent distribution platform for personal and commercial insurance in the United States, representing hundreds of insurance carriers [2] - The company provides innovative insurance solutions through a network of agents, carriers, and technology-driven distribution models [2]

Financial Data and Key Metrics Changes - Total revenue grew by 16.6% to $53.8 million, with organic revenue growth of 14.3% [4][12] - Adjusted EBITDA increased by 35.3% year over year to $12.2 million, with adjusted EBITDA margin expanding to 22.6% compared to 19.5% in the prior year [15][17] - Total written premiums rose by 15.5% to $371 million, reflecting strength in both new business and renewal production [4][10] Business Line Data and Key Metrics Changes - Insurance services grew by 14.7%, while TWFG MGA grew by 20.1% [10] - New business growth was 26% or $18.4 million, and renewal business growth was 12.5% or $31.3 million [10] - MGA offering saw a significant uptick in new business growth of 89% or $8 million [11] Market Data and Key Metrics Changes - Personal lines are softening, but carrier capacity remains stable in most areas [6] - The private passenger auto market has normalized, with retention rates returning to a historic average of 88% [7] - The California property market has been challenging, but TWFG has navigated it effectively [6] Company Strategy and Development Direction - The company is focused on expanding its national footprint and investing in agent success [17][18] - There is a robust M&A pipeline, with $196 million in cash on hand, allowing for significant balance sheet flexibility [18] - The company is adjusting its 2025 guidance upward, expecting organic revenue growth of 12% to 16% [17] Management's Comments on Operating Environment and Future Outlook - Management is confident in the ability to deliver on 2025 guidance despite macroeconomic uncertainties [17] - The company is seeing increased demand for insurance options, highlighting the value of a trusted local adviser [17] - Management believes that the current investments will fuel future growth trajectories [5] Other Important Information - The company added 17 new branch locations during the quarter, aligning with acquisition expectations for revenue and EBITDA [5] - Adjusted net income increased by 14.3% to $9.2 million, driven by earnings growth [15] Q&A Session Summary Question: Are the first quarter expenses fully loaded for public company costs? - Management indicated that there will be future public company expenses as they comply with long-term obligations [20] Question: What gives comfort that retention has bottomed out? - Management stated that the 88% premium retention number aligns with their long-term average and reflects market conditions [21][24] Question: How would you characterize the commission rates in the quarter? - Management described commission rates as stabilizing, with potential for enhanced new business compensation [28][30] Question: Was the 17 branch additions a gross or net number? - Management confirmed that the 17 agencies were gross additions, not net [31][32] Question: Is there a certain amount of revenue or EBITDA from acquisitions in the full year guidance for 2025? - Management indicated that the guidance aligns with previous analyst models, with confidence in achieving projected revenue from acquisitions [35] Question: Why do new agent additions take longer compared to other distribution systems? - Management explained that their agents typically come from captive relationships and face non-compete clauses, requiring time to build a client base [40][44] Question: How significant is the addition of GEICO to the portfolio? - Management emphasized that GEICO is a significant addition, providing favorable pricing and commission rates, which helps stabilize commission reductions [46][48] Question: When should additional IPO expenses be expected? - Management noted that while some expenses were not incurred in Q1, future expenses related to compliance will be integrated into forecasts [51][53] Question: Will the wholesale business start moderating growth rates? - Management expects the program side to expand, particularly in fragmented markets like homeowners [56] Question: What is the outlook for the Texas market? - Management expressed optimism for the Texas property market, anticipating improved conditions as reinsurance renewals clear [68] Question: How is the implementation of higher deductibles impacting revenues? - Management indicated that most carriers have maintained a 2% wind hurricane hail deductible, which is now standard across the state [71] Question: Will the IA channel embrace GEICO as a strong force? - Management believes that bundling opportunities will allow for competitive advantages, making GEICO a significant player in the IA channel [74]

Financial Data and Key Metrics Changes - Total revenue grew by 16.6% to $53.8 million, with organic revenue growth of 14.3% [4][12] - Adjusted EBITDA increased by 35.3% year over year to $12.2 million, with adjusted EBITDA margin expanding to 22.6% compared to 19.5% in the prior year [15] - Net income for the quarter was $6.9 million, up 3.4% year over year [15] Business Line Data and Key Metrics Changes - Total written premiums rose by 15.5% to $371 million, with insurance services growing by 14.7% and TWFG MGA growing by 20.1% [10] - New business growth was 26% or $18.4 million, while renewal business growth was 12.5% or $31.3 million [10] - Consolidated written premium retention decreased to 88% from 94% in the prior year [11] Market Data and Key Metrics Changes - The personal lines market continues to soften, with stable carrier capacity in most regions [6] - The addition of GEICO to the private passenger auto portfolio is expected to enhance growth opportunities [7] - Retention rates have normalized to the historic average of 88% as markets open up for growth [7] Company Strategy and Development Direction - The company is focused on expanding its national footprint and investing in agent success while maintaining operational efficiency [18] - A robust M&A pipeline and $196 million in cash on hand provide significant balance sheet flexibility for future investments [18] - The company is adjusting its 2025 guidance upward, expecting organic revenue growth of 12% to 16% and total revenues between $240 million and $255 million [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties and highlighted increased demand for insurance options [17] - The company is well-positioned to support clients through economic transitions, emphasizing the value of a trusted local adviser [17] - Future public company expenses are anticipated as the company complies with long-term obligations [20] Other Important Information - The company added 17 new branch locations during the quarter, aligning with acquisition expectations for revenue and EBITDA [5] - The onboarding of new agents typically takes two to three years to reach full productivity [5] Q&A Session Summary Question: Are first quarter expenses fully loaded for public company costs? - Management indicated that future public company expenses will arise as compliance with internal audit functions and other obligations develops over time [20] Question: What gives comfort that retention has bottomed out? - Management noted that the 88% premium retention number aligns with their long-term average and reflects the ability to shift clients to favorable pricing [22][24] Question: How would you characterize commission rates in the quarter? - Management described commission rates as stabilizing, with new business incentives expected to enhance compensation [29][30] Question: Was the 17 branch additions a gross or net number? - Management confirmed that the 17 agencies were gross additions, not net [32] Question: Is there a specific revenue or EBITDA contribution from acquisitions in the full year guidance? - Management stated that the current guidance aligns with the analyst model, with confidence in achieving projected revenue from acquisitions [35] Question: Why does TWFG's agent addition process take longer compared to others? - Management explained that TWFG recruits experienced agents who often come from captive relationships, which limits their ability to bring existing clientele [44] Question: How significant is the addition of GEICO to the portfolio? - Management emphasized that GEICO is a significant addition, providing favorable pricing and commission rates that stabilize the overall commission structure [47] Question: What is the outlook for the Texas homeowners market? - Management expressed optimism for the Texas market, anticipating improved conditions as reinsurance renewals clear [68] Question: Will the company need to spend more on recruiting in the future? - Management acknowledged the potential need for increased resources for recruiting, especially as new geographies are opened [84]

Financial Data and Key Metrics Changes - Total revenue grew by 16.6% to $53.8 million, with organic revenue growth of 14.3% [4][13] - Adjusted EBITDA increased by 35.3% year over year to $12.2 million, with adjusted EBITDA margin expanding to 22.6% from 19.5% [16] - Net income for the quarter was $6.9 million, up 3.4% year over year, while adjusted net income rose 14.3% to $9.2 million [16] Business Line Data and Key Metrics Changes - Total written premiums rose by 15.5% to $371 million, with insurance services growing by 14.7% and TWFG MGA increasing by 20.1% [10][12] - New business growth was 26% or $18.4 million, while renewal business growth was 12.5% or $31.3 million [11] - The retention rate for written premiums decreased to 88% from 94% in the prior year period [12] Market Data and Key Metrics Changes - The personal lines market is softening, with stable carrier capacity in most regions [6] - The private passenger auto market has normalized, with expectations of moderate rate increases in 2025 [7] - Retention rates have normalized to the historic average of 88% as markets open up for growth [7] Company Strategy and Development Direction - The company is focused on expanding its national footprint, investing in agent success, and maintaining operational efficiency [19] - TWFG has a robust M&A pipeline and plans to continue investing in growth opportunities [19] - The company is adjusting its 2025 guidance upward, expecting organic revenue growth of 12% to 16% and total revenues between $240 million and $255 million [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties and highlighted increased demand for insurance options [18] - The company is well-positioned to support clients through economic transitions, emphasizing the value of a trusted local adviser [18] - Future public company expenses are anticipated as the company complies with long-term obligations [21] Other Important Information - The company added 17 new branch locations during the quarter and completed two corporate acquisitions [5] - Interest income has been moved from the revenue line to other income for better comparability [9] Q&A Session Summary Question: Are the first quarter expenses fully loaded for public company costs? - Management indicated that future public company expenses will arise as compliance requirements evolve [21] Question: What gives comfort that retention has bottomed out? - Management noted that the 88% retention rate aligns with their long-term average and is supported by market conditions [24] Question: How are commission rates characterized in the quarter? - Management described commission rates as stabilizing, with potential upward skew due to new business incentives [31] Question: Was the 17 branch additions a gross or net number? - Management confirmed that the 17 additions were gross and higher than pre-disruption averages [35] Question: Is there a specific revenue or EBITDA contribution from acquisitions in the guidance? - Management stated that the guidance reflects the original analyst model, with confidence in achieving projected results from acquisitions [36] Question: Why does TWFG's agent onboarding take longer compared to others? - Management explained that agents often come from captive relationships and face non-compete clauses, requiring time to build a client base [44] Question: How significant is the addition of GEICO to the portfolio? - Management emphasized that GEICO provides favorable pricing and commission rates, enhancing retention and stability in the market [50] Question: What is the outlook for the Texas homeowners market? - Management expects favorable conditions in Texas, with improved capacity and economic conditions [70]

Core Insights - TWFG, Inc. reported a strong first quarter performance with total revenues increasing by 16.6% year-over-year to $53.8 million and total written premium rising by 15.5% to $371.0 million [1][5][8] - The company achieved an organic revenue growth rate of 14.3%, indicating robust new business production and effective agent productivity [1][6][8] - Adjusted EBITDA increased by 35.3% to $12.2 million, with an adjusted EBITDA margin expanding to 22.6% [1][11][38] Financial Performance - Net income for the quarter was $6.9 million, slightly up from $6.6 million in the prior year, resulting in a net income margin of 12.7% [1][10][11] - Adjusted net income rose to $9.2 million, with an adjusted net income margin of 17.1% [1][10][11] - Cash flow from operating activities improved to $15.6 million, compared to $9.8 million in the previous year [11] Business Expansion - The company expanded its national footprint by acquiring two new corporate locations and adding 17 branches across the U.S. [4] - The newly onboarded agents are expected to take two to three years to reach full productivity, indicating a long-term growth strategy [4] Key Performance Indicators - Total written premium for the first quarter was $371.0 million, with insurance services contributing significantly [32][39] - The breakdown of total written premium showed that personal lines accounted for 80% and commercial lines for 20% [39] - The company reported a written premium retention rate of 88% for insurance services and 82% for TWFG MGA [39]

Financial Performance - Total revenues for the three months ended March 31, 2025, increased to $53,823,000, up 16.5% from $46,143,000 in the same period of 2024[15] - Net income attributable to TWFG, Inc. for the three months ended March 31, 2025, was $1,338,000, compared to $0 in the same period of 2024[15] - Comprehensive income attributable to TWFG, Inc. for the three months ended March 31, 2025, was $1,320,000, compared to $0 in the same period of 2024[17] - Net income for the three months ended March 31, 2025, was $6,853,000, compared to $6,629,000 for the same period in 2024, reflecting a growth of approximately 3.4%[26] - The company reported a segment net income of $6.85 million for the three months ended March 31, 2025, compared to $6.63 million in the same period of 2024[100] Revenue Sources - The company reported an increase in commission income to $48,785,000 for the three months ended March 31, 2025, from $42,545,000 in the same period of 2024[15] - Commission income increased to $48,785,000 in Q1 2025, up from $42,545,000 in Q1 2024, reflecting a growth of 14.4%[38] Assets and Liabilities - Total assets as of March 31, 2025, were $330,530,000, an increase from $323,428,000 as of December 31, 2024[20] - Total liabilities as of March 31, 2025, were $50,473,000, compared to $48,142,000 as of December 31, 2024[20] - As of March 31, 2025, total debt was $7,019,000, a decrease from $7,642,000 as of December 31, 2024[48] Cash Flow - Cash provided by operating activities increased to $15,645,000 for the three months ended March 31, 2025, up from $9,754,000 in the prior year, representing a year-over-year increase of about 60.5%[26] - Total cash, cash equivalents, and restricted cash at the end of March 31, 2025, was $208,277,000, compared to $31,418,000 at the end of March 31, 2024, indicating a significant increase[28] - The company reported a net change in cash, cash equivalents, and restricted cash of $2,954,000 for the three months ended March 31, 2025, contrasting with a net change of $(15,050,000) in the same period of 2024[28] Expenses - Cash distributions to members decreased to $2,024,000 in the three months ended March 31, 2025, from $2,420,000 in the same period of 2024, showing a reduction of approximately 16.4%[26] - Depreciation and amortization expenses rose to $3,359,000 for the three months ended March 31, 2025, compared to $3,013,000 in the prior year, marking an increase of about 11.5%[26] - The company incurred stock-based compensation expenses of $1,204,000 for the three months ended March 31, 2025, compared to no such expenses in the same period of 2024[26] Shareholder Information - Weighted average diluted shares outstanding for the three months ended March 31, 2025, were 15,055,553[15] - Basic and diluted earnings per share for the three months ended March 31, 2025, were both $0.09[15] - The company has 336,373 unvested RSUs as of March 31, 2025, with a weighted-average grant date fair value of $19.12[73] Acquisitions - The Company acquired assets of nine independent branches in January 2024, resulting in an increase in customer lists intangible assets of $40.8 million[41] - In January 2025, the Company acquired Mike Powell Insurance and United States Insurance Group for a total of $10.6 million, recognizing intangible assets of $8.0 million and $2.6 million, respectively[43] - The company completed the acquisition of Ralph E. Wade Insurance Agency Inc. for a total consideration of $4.3 million, with $3.0 million paid in cash[86] - Following the Wade acquisition, the company sold a 10.9% interest in the assets purchased to AIS for $0.5 million, increasing TWFG-IS's ownership of AIS from 70% to 76.9%[87] Tax Information - The estimated effective tax rate for the three months ended March 31, 2025, was 8.74%, with an income tax expense of $0.7 million[78] - TWFG Holding made tax distributions to its members totaling approximately $2.8 million for the three months ended March 31, 2025[69] Stock Information - The company issued 11 million shares of Class A Common Stock at $17.00 per share during the IPO, raising approximately $192.9 million in net proceeds after expenses[61] - As of March 31, 2025, the company has 14,904,083 shares of Class A Common Stock outstanding, representing 26.6% ownership, while noncontrolling interests hold 73.4%[68] - The company has not issued any preferred stock as of March 31, 2025, despite having authorized 50 million shares[65] Other Financial Metrics - The allowance for expected credit losses decreased slightly to $413,000 as of March 31, 2025, from $370,000 at the end of Q1 2024[40] - The net carrying amount of intangible assets at the end of Q1 2025 was $80,919,000, up from $72,978,000 at the end of Q1 2024[45] - The Company incurred interest expense of $100,000 for the three months ended March 31, 2025, compared to $800,000 for the same period in 2024[48] - The company allocated general and administrative expenses related to its subsidiaries totaling $1.6 million for the three months ended March 31, 2025, compared to $1.0 million for the same period in 2024[83] - The company incurred $0.8 million in software licensing fees for the three months ended March 31, 2025, an increase from $0.5 million in the same period of 2024[85] Future Outlook - Subsequent to the quarter ended March 31, 2025, the company completed acquisitions and business partnerships to support ongoing growth strategies[101]

Financial Results Announcement - TWFG, Inc. will release its financial results for the first quarter ended March 31, 2025, after market closes on May 13, 2025 [1] - A conference call to discuss the financial results is scheduled for May 14, 2025, at 8:00 a.m. Central Time [1] Accessing the Conference Call - Participants can register for the call via a provided link to receive dial-in details [2] - A live webcast of the call will be available on TWFG's Investor Relations website [2] - A replay of the webcast will be accessible for a limited time after the call [2] Company Overview - TWFG, Inc. is a leading insurance distribution platform offering innovative and personalized insurance solutions across the United States [3] - The company is committed to service, professionalism, and entrepreneurial spirit, empowering its network of agents to provide client-focused insurance options [3]

THE WOODLANDS, Texas, May 01, 2025 (GLOBE NEWSWIRE) -- TWFG, Inc. (“TWFG”, the “Company”), a high-growth insurance distribution company, announced today the acquisition of two agencies, one in Texas and one in North Carolina, and the hiring of Denise Davis as Vice President of Retail Operations. Denise Davis Insurance, located in Tomball, Texas, converted to a TWFG Corporate Branch on April 1, 2025, after nearly 23 years as an independent TWFG Branch. This move allows Denise to take on the role of Vice Pres ...