Ryan Specialty (US:RYAN)2024-10-31 11:14Financial Performance - Total revenue for the three months ended September 30, 2024, was $604.694 million, an increase of 20.4% compared to $501.938 million for the same period in 2023[14]. - Net commissions and fees for the nine months ended September 30, 2024, reached $1.806 billion, up 19.8% from $1.507 billion in the prior year[14]. - Operating income for the three months ended September 30, 2024, was $81.477 million, representing a 16.5% increase from $69.817 million in the same quarter of 2023[14]. - Net income attributable to Ryan Specialty Holdings, Inc. for the three months ended September 30, 2024, was $17.589 million, compared to a net loss of $5.047 million in the same period last year[15]. - Basic net income per share for the three months ended September 30, 2024, was $0.15, compared to a loss of $0.04 in the same quarter of 2023[15]. - Net income for the three months ended September 30, 2024, was $28,643 thousand, compared to $15,703 thousand for the same period in 2023, representing an increase of 82.2%[16]. - Net income attributable to Ryan Specialty Holdings, Inc. for the nine months ended September 30, 2024, was $80,911 thousand, up from $38,191 thousand in 2023, reflecting a growth of 111.3%[16]. - Total revenue for the three months ended September 30, 2024, was $630.3 million, an increase of 11.4% from $565.7 million for the same period in 2023[40]. - Net income for the three months ended September 30, 2024, was $8.3 million, a decrease of 67.0% compared to $25.2 million for the same period in 2023[40]. Expenses and Liabilities - Total operating expenses for the nine months ended September 30, 2024, were $1.534 billion, an increase of 19.6% from $1.282 billion for the same period in 2023[14]. - Interest expense for the three months ended September 30, 2024, was $49.388 million, compared to $31.491 million in the same period of 2023[14]. - Compensation and benefits expenses increased by 19.5% to $393.2 million for the three months ended September 30, 2024, from $329.2 million in the prior year[138]. - General and administrative expenses rose by 28.0% to $88.7 million for the three months ended September 30, 2024, compared to $69.3 million in the same period of 2023[138]. - Amortization expense increased by 32.5% to $39.2 million for the three months ended September 30, 2024, up from $29.6 million in the prior year[138]. - Interest expense, net increased by $20.1 million, or 22.3%, from $89.8 million to $109.9 million for the nine months ended September 30, 2024, primarily due to increased debt from acquisitions[165]. - The total debt as of September 30, 2024, was $2.68 billion, compared to $1.98 billion as of December 31, 2023, reflecting an increase of 35%[52]. Assets and Equity - Total assets increased to $8,478,503 thousand as of September 30, 2024, from $7,247,209 thousand at December 31, 2023, marking a rise of 17.0%[17]. - Cash and cash equivalents decreased to $1,356,113 thousand at the end of September 30, 2024, down from $1,603,000 thousand at the end of 2023, a decline of 15.4%[18]. - Total stockholders' equity attributable to Ryan Specialty Holdings, Inc. increased to $632,833 thousand as of September 30, 2024, from $559,754 thousand at December 31, 2023, an increase of 13.0%[17]. - The balance at September 30, 2024, showed total stockholders' equity at $1,101,532,000[21]. - As of September 30, 2023, total stockholders' equity was $941,241,000, an increase from $817,812,000 at December 31, 2022, representing a growth of approximately 15.1%[22]. Acquisitions and Growth - The company completed the acquisition of US Assure Insurance Services for cash consideration of $1,079.8 million and contingent consideration of $103.8 million on August 30, 2024[33]. - The total assets acquired during the nine months ended September 30, 2024, amounted to $1.81 billion, with net assets acquired totaling $1.48 billion[34]. - The company has made several acquisitions in 2024, including Castel Underwriting Agencies Limited and US Assure Insurance Services, enhancing its distribution reach and product capabilities[123]. - The restructuring program, ACCELERATE 2025, is expected to incur total costs of approximately $110.0 million and generate annual savings of about $60.0 million starting in 2025[43]. - The company recognized $24.5 million and $33.8 million of revenue related to acquisitions for the three and nine months ended September 30, 2024, respectively[36]. Cash Flow and Dividends - The company reported cash flows from operating activities of $255,228 thousand for the nine months ended September 30, 2024, compared to $250,335 thousand in 2023, a slight increase of 2.8%[18]. - Cash flows used for investing activities during the nine months ended September 30, 2024, were $1,286.4 million, an increase of $904.5 million compared to $381.9 million in the same period of 2023[195]. - During the nine months ended September 30, 2024, the Company paid $66.5 million in dividends on Class A common stock, including $27.1 million for a special Q1 2024 dividend[60]. - The Company declared a one-time special cash dividend of $0.23 per share and initiated a regular quarterly dividend of $0.11 per share on Class A common stock[186]. Risk Factors - The company faces various risks including regulatory changes, operational challenges, and potential legal proceedings that could impact financial performance[8]. - The company is evaluating the impact of recently issued accounting standards on its consolidated financial statements and disclosures[29]. - Approximately 4% of revenues for the nine months ended September 30, 2024, were generated from activities in the United Kingdom, Europe, and Canada, indicating exposure to foreign currency risk[204]. Tax and Compliance - The Company recorded Tax Receivable Agreement liabilities of $455.1 million as of September 30, 2024, reflecting increases of $95.6 million and $63.2 million for the nine months ended September 30, 2024, and 2023, respectively[112]. - The Company incurred expenses of $2.7 million related to services provided to Geneva Re for the three months ended September 30, 2024, compared to $2.2 million for the same period in 2023[104]. - The Company recognized a non-cash deferred income tax expense of $20.7 million for the three and nine months ended September 30, 2023, due to common control reorganization[110].