Kingsway Financial Services Inc (KFS) 2025 Earnings Call Presentation

Kingsway's Business Model and Strategy - Kingsway Financial Services Inc is the only publicly-traded US company employing the Search Fund model to acquire and build businesses[9, 59] - Kingsway seeks to compound long-term shareholder value through its decentralized management model and tax-advantaged structure[10] - Kingsway employs the traditional Search Fund model to acquire small businesses with EBITDA of $1-3 million for roughly 4-6x EBITDA using a 50/50 split of equity and debt[20] - Kingsway targets 2-3 acquisitions per year with an acquisition IRR hurdle of >30%[50] - Kingsway has $622 million of valuable NOL tax assets[41] Financial Performance and Acquisitions - Kingsway's 12-month run-rate adjusted EBITDA for its operating companies is $18.0-$19.0 million[51] - KSX revenue grew +23.3% year-over-year in Q1 2025[68] - KSX adjusted EBITDA grew +23.2% year-over-year in Q1 2025[68] - Bud's Plumbing was acquired for $5.0 million at a 6.0x EBITDA multiple based on $0.8 million TTM Adj EBITDA[55, 102] Search Fund Model and Market Opportunity - Historical return across all Search Funds tracked by the Stanford Graduate School of Business since 1984 is +35.1%[14] - Nearly $4.8 trillion of net worth will be transferred over the next 20 years due to Baby Boomer business owner retirements[22]