Financial Data and Key Metrics Changes - Consolidated revenue for Q2 2025 was $30.9 million, an increase of 16.9% compared to $26.4 million in Q2 2024 [20] - Consolidated adjusted EBITDA for Q2 2025 was $1.7 million, down from $2.5 million in the prior year quarter [20] - Trailing twelve month adjusted run rate EBITDA for the businesses owned was approximately $22 million to $23 million [16] Business Line Data and Key Metrics Changes - In the KSX segment, revenue increased by 42.1% to $13.3 million in Q2 2025, up from $9.3 million in the same quarter a year ago [20] - Adjusted EBITDA for the KSX segment increased by 31% to $2.4 million compared to $1.8 million in the year-ago quarter [20] - Revenue for the Extended Warranty segment increased by 3.1% to $17.6 million in Q2 2025, up from $17.1 million in the prior year period [23] Market Data and Key Metrics Changes - The four largest midstream natural gas pipeline operators expect to increase their capacity by approximately 17% by 2026, indicating strong demand for additional pipeline capacity in the Permian Basin [9] - The shift from combustible engine motors to electric motors in the Permian Basin has increased from an estimated 10% in 2020 to over 20% today, suggesting a significant industry trend [10] Company Strategy and Development Direction - The company aims to accelerate growth through its public search fund strategy, increasing its target for KSX acquisitions from 2-3 per year to 3-5 per year [7] - The company is focused on building a diversified collection of high-quality services companies that are asset-light and generate recurring revenue [5] - The company is positioning itself to efficiently source, acquire, and scale additional businesses that fit its model [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth potential, stating that the second quarter marked significant progress with three acquisitions and increased capital for growth ambitions [19] - The company believes that the earnings power of its KSX segment is at a record high and is optimistic about future performance [19] - Management noted that the extended warranty segment remains cash generative and is well-positioned for continued success despite recent challenges [24] Other Important Information - The company completed a private placement of common shares, raising $15.7 million to support its growth strategy [6] - As of June 30, 2025, the company held $12.1 million in cash and cash equivalents, up from $5.5 million at year-end [24] - The company recorded a $600,000 expense related to a settlement agreement, which will not recur going forward [27] Q&A Session Summary Question: Clarification on run rate EBITDA - Management clarified that the run rate EBITDA of $22 million to $23 million includes both existing businesses and recent acquisitions [32] Question: Future acquisition expectations - Management indicated that they do not plan to stop acquisitions after reaching their target range and will continue to seek opportunities [38][40] Question: Active OIRs and talent pipeline - Management confirmed there are currently two active OIRs and expressed intentions to increase this number, highlighting a strong pipeline of talent [41][42] Question: Learning from acquisitions - Management acknowledged learning from past acquisitions and emphasized a tighter focus on revenue quality and recurring revenue in future deals [44] Question: Attributes of future OIRs - Management stated that while future OIRs may vary, they will continue to seek candidates with specific attributes indicative of success in small company leadership [47]

Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $28.3 million, an increase of 8.4% compared to $26.2 million in Q1 2024 [16] - Consolidated adjusted EBITDA declined by $800,000 year over year, reflecting lower profitability in the extended warranty segment and higher holdcoat costs [16] - Trailing twelve month adjusted run rate EBITDA for the businesses stood at approximately $18 million to $19 million [15] Business Line Data and Key Metrics Changes - In the Kingsway Search Accelerator (KSX) segment, revenue was $11.7 million, up 23.3% from $9.5 million in the same period last year, with adjusted EBITDA also increasing by 23.3% [17] - The extended warranty segment's revenue was flat at $16.7 million compared to Q1 2024, but cash sales increased by 3.7% year over year [21] - Adjusted EBITDA for the extended warranty segment was $800,000, down from $1.4 million in the prior year quarter [22] Market Data and Key Metrics Changes - Cash sales in the extended warranty segment showed a sequential increase of 9.3% from year-end [21] - Trailing twelve month modified cash EBITDA for the extended warranty segment was up 11.7% year over year [22] Company Strategy and Development Direction - The company aims to capitalize on the search fund model at scale within a tax-efficient public company framework [5] - Recent acquisitions, including Bud's Plumbing and Viewpoint, are expected to enhance the KSX platform and provide additional growth levers [10][11] - The company is focused on driving growth and profitability while maintaining a robust deal pipeline [29] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory in the KSX segment, indicating that many businesses are nearing an inflection point for accelerated growth [13] - The extended warranty segment is entering a more favorable phase of recovery after two challenging years, with signs of returning cash sales growth [14] - The company is excited about the progress made and the potential for future growth in 2025 [30] Other Important Information - The company appointed two new independent directors to strengthen corporate governance [11] - A $6 million private placement was completed to fund the Bud's Plumbing acquisition, increasing cash and cash equivalents to $6.4 million [26][28] Q&A Session Summary Question: Can you provide any color on the Viewpoint acquisition and its strategic fit? - The acquisition was sourced by Drew at SPI and strategically fits by providing a cloud-native software solution for smaller customers in North America while expanding geographic reach [33] Question: Can you explain the J curve with search acquisitions? - The J curve represents the initial negative impact on profitability due to investments in talent and technology, followed by a period of growth as these investments pay off [36] Question: Can you share more about the robust deal pipeline? - The company has experienced operators building their M&A pipelines and is excited about potential tuck-in acquisitions across various platforms [40] Question: Why is the owner of Bud's staying on for a one-year transition? - This is typical in search acquisitions to ensure a smooth transition of customer relationships and institutional knowledge [42] Question: Are there other industries targeted for platforms? - The company evaluates industries based on growth potential and operator fit, considering sectors like insurance brokerage and wealth management for future platforms [46]