Goosehead Insurance, Inc. Announces Fourth Quarter and Full Year 2024 Results

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- Total Revenue Increased 20% for the year to $314.5 million -

- Core Revenue Grew 17% for the year to $273.7 million -

- Total Written Premium in 2024 Increased 29% to $3.8 billion -

- 2024 Net Income of $49.1 million versus $23.7 million in 2023 -

- Adjusted EBITDA in 2024 up 43% to $99.9 million -

WESTLAKE, Texas, Feb. 24, 2025 (GLOBE NEWSWIRE) -- Goosehead Insurance, Inc. ("Goosehead” or the "Company”) (NASDAQ: GSHD), a rapidly growing independent personal lines insurance agency, today announced results for the fourth quarter and year ended December 31, 2024.

Fourth Quarter 2024 Highlights

• Total Revenues grew 49% over the prior-year period to $93.9 million in the fourth quarter of 2024
• Fourth quarter Core Revenues* of $68.0 million increased 19% over the prior-year period
• Fourth quarter net income of $23.8 million improved from net income of $5.4 million a year ago. EPS of $0.60 per share increased 300% and adjusted EPS* of $0.79 per share increased 182%, over the prior-year period
• Net income margin for the fourth quarter was 25%
• Adjusted EBITDA* of $37.4 million increased 164% from $14.1 million in the prior-year period
• Adjusted EBITDA Margin* increased 17 percentage points over the prior-year period to 40%
• Total written premiums placed for the fourth quarter increased 28% over the prior-year period to $965.6 million
• Policies in force grew 13% from the prior-year period to approximately 1,674,000

^*Core Revenue, Adjusted EPS, Adjusted EBITDA, and Adjusted EBITDA Margin are non-GAAP measures. Reconciliations of Core Revenue to total revenues, Adjusted EPS to basic earnings per share and Adjusted EBITDA to net income, the most directly comparable financial measures presented in accordance with GAAP, are set forth in the reconciliation table accompanying this release.

"We had an outstanding 2024 in the face of significant macro headwinds. For the full year premium growth was 29%, total revenue increased 20%, core revenue was up 17%, net income grew 107% to $49.1 million and Adjusted EBITDA grew 43% to $99.9 million, with net income margin of 16% up 700 basis points and Adjusted EBITDA Margin of 32% up 500 basis points,” stated Mark K Miller, President and CEO. "I am pleased we began to demonstrate growth re-acceleration in a number of key performance indicators including policies in force were up 13%. Our producer base is healthier than ever as franchise productivity was up 49%, coupled with franchise producer growth of 7%. Loss activity and insurance market challenges in 2024 and the start of 2025 have further highlighted the importance of appropriate personal lines coverage, as well as the value we bring to clients, agents and carriers. We are encouraged to be seeing signs of gradual improvement in the product market. I couldn't be more excited for what lies ahead as we continue to invest in people and technology. This further expands our competitive moat as we progress on our journey to becoming the largest distributor of personal lines in the US.” 

Fourth Quarter 2024 Results

For the fourth quarter of 2024, revenues were $93.9 million, an increase of 49% compared to the corresponding period in 2023. Core Revenues, a non-GAAP measure which excludes contingent commissions, initial franchise fees, interest income, and other income, were $68.0 million, a 19% increase from $56.9 million in the prior-year period. Core Revenues are the most reliable revenue stream for the Company, consisting of New Business Commissions, Agency Fees, New Business Royalty Fees, Renewal Commissions, and Renewal Royalty Fees. Core Revenue growth was primarily driven by strong client retention of 84% and rising premium rates as well as increases in both the number of corporate agents and productivity per agency. The Company grew total written premiums, which we consider to be the leading indicator of future revenue growth, by 28% in the fourth quarter compared to the corresponding period in prior year.

Total operating expenses, excluding equity-based compensation, depreciation and amortization and impairment expenses, for the fourth quarter of 2024 were $56.5 million, up 16% from $48.9 million in the prior-year period. The increase from the prior period was primarily due to increased employee compensation and benefits expenses related to investments in corporate producers, technology, and service functions. General and administrative expenses, excluding impairment, increased to $17.8 million from $14.1 million primarily due to investments in technology and systems to drive growth and continue to improve the client experience. Equity-based compensation increased to $6.9 million for the period, compared to $5.0 million a year ago. Bad debt expense of $0.6 million decreased from $1.0 million a year ago.

Net income in the fourth quarter of 2024 was $23.8 million versus net income of $5.4 million a year ago, with the improvement primarily due to strong revenue growth and expense discipline. Earnings per share and Net Income Margin for the fourth quarter of 2024 were $0.60 and 25%, respectively. Adjusted EPS for the fourth quarter of 2024, which excludes equity-based compensation and impairment expense, was $0.79 per share. Total Adjusted EBITDA was $37.4 million for the fourth quarter of 2024 compared to $14.1 million in the prior-year period. Adjusted EBITDA Margin of 40% was up 17 percentage points in the quarter.

Liquidity and Capital Resources

As of December 31, 2024, the Company had cash and cash equivalents of $58.0 million. We had an unused line of credit of $74.8 million as of December 31, 2024. Total outstanding term note payable balance was $93.1 million as of December 31, 2024.

On January 8, 2025, the Company entered into a credit agreement (the "2025 Credit Agreement") providing for an aggregate $300 million term notes payable (the "2025 Initial Term Loan") and $75 million revolving credit facility (the "2025 Revolving Credit Facility"). The 2025 Initial Term Loan matures on January 8, 2032 and the 2025 Revolving Credit Facility matures on January 8, 2030. This credit agreement replaces the existing Second Amended and Restated Credit Agreement, dated July 21, 2021, which was repaid with the proceeds of the 2025 Initial Term Loan and terminated.

On January 9, 2025, Goosehead Financial, LLC ("GF”) declared a special distribution of $175 million, which was paid in cash on January 31, 2025 to holders of record of LLC Units, including to GSHD, as of the close of business on January 21, 2025. The special distribution resulted in a payment of $59 million to our non-controlling interest holders. On January 9, 2025, the board of directors of the Company declared a one-time special cash dividend of $5.91 to all holders of Class A common stock of GSHD as of the close of business on January 21, 2025, which was paid in cash on January 31, 2025 for a total of $146 million. $1.22 of the special cash dividend was funded by cash received by GSHD from prior tax distributions from GF that are in excess of the corporate income taxes payable by GSHD. The remaining $4.69 of the special dividend was funded by the cash received by the Company from the special distribution by GF.

2025 Outlook

Our guidance for the full year 2025 is as follows:

• Total written premiums placed are expected to be between $4.65 billion and $4.88 billion representing 22% organic growth on the low end of the range, and 28% organic growth on the high end of the range.
• Total revenues are expected to be between $350 million and $385 million representing 11% organic growth on the low end of the range and 22% organic growth on the high end of the range.

Conference Call Information

Goosehead will host a conference call and webcast today at 4:30 PM ET to discuss these results.

To access the call by phone, participants should go to this link (registration link), and you will be provided with the dial in details.

In addition, a live webcast of the conference call will also be available on Goosehead's investor relations website at http://ir.goosehead.com.

A webcast replay of the call will be available at http://ir.goosehead.com for one year following the call.

About Goosehead

Goosehead (NASDAQ: GSHD) is a rapidly growing and innovative independent personal lines insurance agency that distributes its products and services through corporate and franchise locations throughout the United States. Goosehead was founded on the premise that the consumer should be at the center of our universe and that everything we do should be directed at providing extraordinary value by offering broad product choice and a world-class service experience. Goosehead represents over 200 insurance companies that underwrite personal and commercial lines. For more information, please visit goosehead.com or goosehead.com/become-a-franchisee.

Forward-Looking Statements

This press release may contain various "forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which represent Goosehead's expectations or beliefs concerning future events. Forward-looking statements are statements other than historical facts and may include statements that address future operating, financial or business performance or Goosehead's strategies or expectations. In some cases, you can identify these statements by forward-looking words such as "may”, "might”, "will”, "should”, "expects”, "plans”, "anticipates”, "believes”, "estimates”, "predicts”, "projects”, "potential”, "outlook” or "continue”, or the negative of these terms or other comparable terminology. Forward-looking statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that could cause actual results, developments and business decisions to differ materially from those contemplated by these statements.

Factors that could cause actual results or performance to differ from the expectations expressed or implied in such forward-looking statements include, but are not limited to, conditions impacting insurance carriers or other parties with which Goosehead does business, the loss of one or more key executives or an inability to attract and retain qualified personnel and the failure to attract and retain highly qualified franchisees. These risks and uncertainties also include, but are not limited to, those described under the captions "1A. Risk Factors” in Goosehead's Annual Report on Form 10-K for the year ended December 31, 2024 and in Goosehead's other filings with the SEC, which are available free of charge on the Securities Exchange Commission's website at: www.sec.gov. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated. All forward-looking statements and all subsequent written and oral forward-looking statements attributable to Goosehead or to persons acting on behalf of Goosehead are expressly qualified in their entirety by reference to these risks and uncertainties. You should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and Goosehead does not undertake any obligation to update them in light of new information, future developments or otherwise, except as may be required under applicable law.

Contacts

Investor Contact:

Dan Farrell

Goosehead Insurance - VP Capital Markets

Phone: (214) 838-5290

Email: [email protected]; [email protected] 

PR Contact:

Mission North for Goosehead Insurance

Email: [email protected]; [email protected]

Goosehead Insurance, Inc.

Consolidated Statements of Operations

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Goosehead Insurance, Inc.

Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)