Financial Performance - Total revenues for the year ended December 31, 2024, were $1,389.0 million, an increase from $1,218.6 million in 2023, representing a growth of 13.9%[303] - Adjusted EBITDA for 2024 was $312.5 million, compared to $250.2 million in 2023, resulting in an adjusted EBITDA margin of 22.5%, up from 20.5%[303] - The net loss for 2024 was $41.1 million, improving from a net loss of $164.0 million in 2023, indicating a significant reduction in losses[303] - Adjusted net income for 2024 was $176.9 million, up from $131.1 million in 2023, reflecting a significant improvement in profitability[308] Revenue Growth - Organic revenue for the year ended December 31, 2024, was $1.38 billion, representing a 17% growth compared to the previous year[306] - Total revenues for the Insurance Advisory Solutions (IAS) segment increased by 10% year over year to $711.9 million, driven by a 10% rise in core commissions and fees[312] - IAS commissions and fees grew by $63.8 million, or 10%, year over year, primarily due to a 21% sales velocity increase[314] - UCTS commissions and fees increased by $66.4 million, or 16%, year over year to $468.9 million, with core commissions and fees growth excluding the Wholesale Business reaching 30%[327][329] - Total revenues for MIS increased by $46.6 million, or 20%, year over year, reaching $281.3 million, driven by organic growth in core commissions and fees[339] Asset and Liability Changes - The company’s total assets increased by $32.8 million, while total liabilities rose by $42.9 million year over year[291] - Long-term debt increased by $428.0 million due to the May 2024 refinancing, which included a new $840 million senior secured first lien term loan facility[293] - Premiums, commissions, and fees receivable, net increased by $74.3 million, while premiums payable to insurance companies rose by $85.7 million, reflecting revenue growth and cash flow timing[292] - Contingent earnout liabilities decreased by $130.9 million, influenced by settlements of $126.2 million and a change in fair value of contingent consideration[294] Cash Flow and Financing Activities - Net cash provided by operating activities increased by $57,507,000 year-over-year, totaling $102,151,000 for 2024[381][382] - Net cash provided by investing activities increased by $35,221,000 year-over-year, driven by $57 million from divestitures[381][383] - Net cash used in financing activities increased by $3,414,000 year-over-year, totaling $29,644,000 for 2024[381][384] - The revolving line of credit decreased by $341.0 million as a result of the refinancing, which aimed to optimize the company’s capital structure[293] Intangible Assets and Goodwill - The company recorded $953.5 million in intangible assets as of December 31, 2024, with no impairment charges recorded in 2024, 2023, or 2022[400] - Goodwill amounted to $1.4 billion at December 31, 2024, with no impairment charges recorded during 2024, 2023, or 2022[406] Tax and Deferred Assets - Deferred tax assets are fully reserved due to a history of cumulative losses over the past three years[380] - The company has established a full valuation allowance for deferred tax assets at December 31, 2024, due to the likelihood of non-realization[418] - If the valuation allowance had not been established, the company would have recognized deferred tax assets of approximately $169.1 million[419] Other Income and Expenses - Total other income for UCTS surged to $34.1 million, compared to $0.9 million in the previous year, marking a significant increase[325] - UCTS operating income improved by $12.4 million, or 42%, year over year, totaling $41.9 million[339] - Corporate and Other recorded a loss before income taxes of $216.8 million, an improvement of $26.8 million, or 11%, compared to the previous year[346] Commitments and Obligations - Total contractual obligations and commitments as of December 31, 2024, amount to $2,395,384,000, with $318,167,000 due within one year[364] - Operating lease obligations total $99,311,000, with annual lease expenses of $21.5 million for 2024[364][367] - Debt obligations include $600 million under Senior Secured Notes and $835.8 million under the 2024 Term Loan, with estimated interest rates of 7.125% and 7.61% respectively[369] Contingent Consideration - Contingent consideration liabilities totaled $145.6 million as of December 31, 2024, with a potential maximum of $268.8 million in remaining payments[413] - If all contingent consideration targets are achieved, the company would incur an additional $123.2 million in expenses over the next two years[413] Other Notable Points - The company has a commitment to donate $3.4 million to the University of South Florida through October 2028[371] - Profit-sharing commissions are subject to significant reversal, with management estimating them based on historical outcomes and known trends[391] - Costs to obtain contracts are capitalized as deferred commission expense and amortized over five years[392]
BRP Group, Inc.(BWIN) - 2024 Q4 - Annual Report