Goosehead Insurance, Inc. Announces Third Quarter 2024 Results

Financial Performance - Total revenue increased by 10% to $78 0 million in Q3 2024 compared to the prior-year period [1][2] - Core revenue grew by 16$73 5 million in Q3 2024 driven by improved franchise productivity increased corporate agent headcount and client retention of 84% [2][4] - Net income for Q3 2024 was $12 6 million up from$11 3 million in the prior-year period with a net income margin of 16% [1][2][7] - Adjusted EBITDA increased to $26 1 million in Q3 2024 from$22 4 million in the prior-year period with an adjusted EBITDA margin of 34% [1][2][7] - Total written premiums grew by 28% to $1 03 billion in Q3 2024 marking the first time the company generated over$1 billion in a single quarter [1][2][3] Operational Highlights - Policies in force increased by 12% to approximately 1 636 000 in Q3 2024 compared to the prior-year period [2] - Corporate agent headcount grew by 45% to 458 in Q3 2024 compared to the prior-year period [2] - Total franchise producers increased by 4% to 2 093 in Q3 2024 compared to the prior-year period and by 5% compared to Q2 2024 [2] - Client retention stabilized at 84% in Q3 2024 despite market challenges [3] Expense Management - Total operating expenses excluding equity-based compensation depreciation and amortization and impairment expenses increased by 7% to $51 9 million in Q3 2024 compared to the prior-year period [5] - Employee compensation and benefits expenses increased due to investments in corporate producers partnership technology and service functions [6] - General and administrative expenses excluding impairment increased to$15 2 million in Q3 2024 from $14 8 million in the prior-year period primarily due to investments in technology and systems [6] Liquidity and Capital Resources - The company had cash and cash equivalents of$47 5 million as of September 30 2024 [8] - An unused line of credit of $74 8 million was available as of September 30 2024 [8] - Total outstanding term note payable balance was$95 6 million as of September 30 2024 [8] 2024 Outlook - Total written premiums for 2024 are expected to be between $3 70 billion and$3 82 billion representing growth of 25% to 29% [9] - Total revenues for 2024 are expected to be between $295 million and$310 million representing growth of 13% to 19% [9] - Adjusted EBITDA margin is expected to expand for the full year 2024 [9] Non-GAAP Measures - Core revenue includes renewal commissions renewal royalty fees new business commissions new business royalty fees and agency fees [21] - Cost recovery revenue includes initial franchise fees and interest income [21] - Ancillary revenue includes contingent commissions and other income [21] - Adjusted EBITDA excludes interest income taxes depreciation and amortization equity-based compensation impairment expense and other non-operating items [21] - Adjusted EPS excludes equity-based compensation and impairment expense [22]