Goosehead Insurance, Inc. Announces First Quarter 2025 Results

– Total Revenue Increased 17% and Core Revenue* Grew 17% over the Prior-Year Period – – Total Written Premium increased 22% to $1.0 billion over the Prior-Year Period – – Net Income of $2.6 million versus Net Income of $1.8 million a year ago – – Adjusted EBITDA* of $15.5 million versus $11.7 million in the Prior-Year Period – – Company Announces new $100 million Share Repurchase Authorization through May 1, 2026 – WESTLAKE, Texas, April 23, 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 first quarter ended March 31, 2025. First Quarter 2025 Highlights Total Revenues grew 17% over the prior-year period to $75.6 million in the first quarter of 2025First quarter Core Revenues* of $69.1 million increased 17% over the prior-year periodFirst quarter net income of $2.6 million improved from net income of $1.8 million a year agoEPS of $0.09 per share increased from $0.07 in the prior-year period, and Adjusted EPS* of $0.26 per share decreased 5% over the prior-year periodNet Income Margin for the first quarter was 4%Adjusted EBITDA* of $15.5 million increased from $11.7 million in the prior-year periodAdjusted EBITDA Margin* increased versus the prior-year period to 21%Total Written Premiums placed for the first quarter increased 22% over the prior-year period to $1.0 billion.Policies in Force increased 13% from the prior-year period to approximately 1,729,000Corporate agent headcount of 426 was up 46% compared to the prior-year periodTotal franchise producers of 2,097 increased 7% from the prior-year period “At Goosehead, our strong growth comes from delivering exceptional value to clients, agents and partners,” said Mark Miller, President and CEO. “For the first quarter we drove premium growth of 22% with total and core revenue* up 17%. Net Income increased 46% for the quarter and Adjusted EBITDA* for the quarter increased 32%. Net Income Margin was 4% and adjusted EBITDA margin* expanded 300 basis points to 21%. During the quarter we invested meaningfully in our production force, service function, technology initiatives, and AI-driven tools to enhance the personal lines experience across all our key stakeholders. We currently place roughly $4 billion in annual premium—still less than 1% of the over $500 billion U.S. personal lines market. We believe our runway is enormous and our competitive moat in the marketplace continues to expand. I could not be more excited for our company's future as we progress towards our goal of becoming the largest distributor of personal lines in the US.” *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. First Quarter 2025 ResultsFor the first quarter of 2025, revenues were $75.6 million, an increase of 17% compared to the corresponding period in 2024. Core Revenues, a non-GAAP measure which excludes contingent commissions, initial franchise fees, interest income, and other income, were $69.1 million, a 17% increase from $58.8 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 driven by improved franchise productivity and client retention of 84%, and rising premium rates. The Company grew total written premiums, which we consider to be the leading indicator of future revenue growth, by 22% in the first quarter. Total operating expenses for the first quarter of 2025 were $69.0 million, up from $63.0 million in the prior-year period. Total operating expenses, excluding equity-based compensation, depreciation and amortization, and impairment expenses* for the first quarter of 2025 were $60.1 million, up 14% from $52.7 million in the prior-year period. Employee compensation and benefits increased to $48.3 million from $42.1 million in the prior-year period. Employee compensation and benefits, excluding equity-based compensation* increased to $42.1 million from $34.8 million in the prior-year period. The increases were primarily due to investments in corporate producers and our service and technology functions. Equity-based compensation decreased to $6.2 million for the period, compared to $7.4 million in the prior-year period. General and administrative expenses increased to $17.6 million from $17.2 million in the prior-year period. General and administrative expenses, excluding impairment*, increased to $17.6 million from $16.8 million in the prior-year period. The increases were primarily due to increases in professional services and investments in technology and systems to drive growth and continue to improve the client experience. Bad debt expense of $0.4 million decreased from $1.1 million in the prior-year period. Net income in the first quarter of 2025 was $2.6 million versus net income of $1.8 million in the prior-year period. Earnings per share and Net Income Margin for the first quarter of 2025 were $0.09 and 4%, respectively. Adjusted EPS for the first quarter of 2025, which excludes equity-based compensation and impairment expense, was $0.26 per share. Total Adjusted EBITDA was $15.5 million for the first quarter of 2025 compared to $11.7 million in the prior-year period. Adjusted EBITDA Margin of 21% increased compared to the prior-year period. *Total operating expenses, excluding equity-based compensation, depreciation and amortization, and impairment expenses; Employee compensation and benefits, excluding equity-based compensation; and General and administrative expenses, excluding impairment are non-GAAP measures. For the definition and reconciliation of each non-GAAP measure, see “Reconciliation of Non-GAAP Measures to GAAP” below. Liquidity and Capital ResourcesAs of March 31, 2025, the Company had cash and cash equivalents of $70.2 million. We had an unused line of credit of $75.0 million as of March 31, 2025. Total outstanding term note payable balance was $300.0 million as of March 31, 2025. During the quarter ended March 31, 2025, the Company did not repurchase any shares of Class A common stock. As of March 31, 2025, the share repurchase authorization expired. The Company’s board of directors authorized a new share repurchase program after the prior repurchase authorization expired on March 31, 2025. The new authorization is for repurchases of up to $100 million of Class A common stock through May 1, 2026. The share repurchase program does not require the Company to acquire any dollar amount or number of shares and may be modified, suspended, or discontinued at any time. 2025 OutlookThe Company is reiterating its guidance for full year 2025 as follows: Total written premiums placed for 2025 are expected to be between $4.65 billion and $4.88 billion, representing growth of 22% on the low end of the range to 28% on the high end of the range.Total revenues for 2025 are expected to be between $350 million and $385 million, representing growth of 11% on the low end of the range to 22% on the high end of the range. Conference Call InformationGoosehead 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. ContactsInvestor Contact:Dan FarrellGoosehead Insurance - VP Capital MarketsPhone: (214) 838-5290Email: dan.farrell@goosehead.com; IR@goosehead.com PR Contact:Mission North for Goosehead InsuranceEmail: goosehead@missionnorth.com; PR@goosehead.com Goosehead Insurance, Inc.Condensed Consolidated Statements of Operations(Unaudited)(In thousands, except per share amounts) Three Months Ended March 31, 2025 2024 Revenues: Commissions and agency fees $29,423 $26,221 Franchise revenues 45,971 37,989 Interest income 189 250 Total revenues 75,583 64,460 Operating Expenses: Employee compensation and benefits 48,334 42,130 General and administrative expenses 17,559 17,180 Bad debts 406 1,127 Depreciation and amortization 2,670 2,568 Total operating expenses 68,969 63,005 Income from operations 6,614 1,455 Other Income: Interest expense (5,823) (1,487)Other income (expense) 168 (6,727)Income (loss) before taxes 959 (6,759)Tax benefit (1,687) (8,568)Net income 2,646 1,809 Less: net income (loss) attributable to noncontrolling interests 304 (5)Net income attributable to Goosehead Insurance, Inc. $2,342 $1,814 Earnings per share: Basic $0.09 $0.07 Diluted $0.09 $0.05 Weighted average shares of Class A common stock outstanding Basic 24,791 25,087 Diluted 25,943 38,839 Goosehead Insurance, Inc.Condensed Consolidated Statements of Operations(Unaudited)(In thousands, except per share amounts) Three Months Ended March 31, 2025 2024 Revenues: Core Revenue: Renewal Commissions(1) $16,952 $15,961 Renewal Royalty Fees(2) 37,244 29,053 New Business Commissions(1) 5,755 5,681 New Business Royalty Fees(2) 6,929 6,234 Agency Fees(1) 2,240 1,911 Total Core Revenue 69,120 58,839 Cost Recovery Revenue: Initial Franchise Fees(2) 1,342 2,245 Interest Income 189 250 Total Cost Recovery Revenue 1,531 2,495 Ancillary Revenue: Contingent Commissions(1) 4,476 2,668 Other Franchise Revenues(2) 456 458 Total Ancillary Revenue 4,932 3,126 Total Revenues 75,583 64,460 Operating Expenses: Employee compensation and benefits, excluding equity-based compensation 42,098 34,773 General and administrative expenses, excluding impairment 17,559 16,833 Bad debts 406 1,127 Total 60,063 52,733 Adjusted EBITDA 15,520 11,727 Adjusted EBITDA Margin 21 % 18 % Interest expense (5,823) (1,487)Depreciation and amortization (2,670) (2,568)Tax benefit 1,687 8,568 Equity-based compensation (6,236) (7,357)Impairment expense — (347)Other income (expense) 168 (6,727)Net Income $2,646 $1,809 Net Income Margin 4 % 3 %(1) Renewal Commissions, New Business Commissions, Agency Fees, and Contingent Commissions are included in "Commissions and agency fees" as shown on the Condensed Consolidated Statements of Operations within Goosehead’s Form 10-Q for the three months ended March 31, 2025 and 2024.(2) Renewal Royalty Fees, New Business Royalty Fees, Initial Franchise Fees, and Other Franchise Revenues are included in "Franchise revenues" as shown on the Condensed Consolidated Statements of Operations within Goosehead’s Form 10-Q for the three months ended March 31, 2025 and 2024. Goosehead Insurance, Inc.Condensed Consolidated Balance Sheets(Unaudited) (In thousands, except per share amounts) March 31, December 31, 2025 2024 Assets Current Assets: Cash and cash equivalents $70,208 $54,280 Restricted cash 2,363 3,693 Commissions and agency fees receivable, net 8,156 31,375 Receivable from franchisees, net 12,178 11,077 Prepaid expenses 22,498 8,139 Total current assets 115,403 108,564 Receivable from franchisees, net of current portion 3,583 3,469 Property and equipment, net of accumulated depreciation 23,455 24,101 Right-of-use asset 36,111 37,420 Intangible assets, net of accumulated amortization 27,094 25,075 Deferred income taxes, net 200,574 193,478 Other assets 6,336 5,546 Total assets $412,556 $397,653 Liabilities and Stockholders’ Equity Current Liabilities: Accounts payable and accrued expenses $20,377 $22,891 Premiums payable 2,363 3,693 Lease liability 5,901 6,535 Contract liabilities 2,743 3,275 Note payable 3,000 10,063 Liabilities under tax receivable agreement 6,993 — Total current liabilities 41,377 46,457 Lease liability, net of current portion 53,116 54,536 Note payable, net of current portion 290,333 82,251 Contract liabilities, net of current portion 15,677 15,191 Liabilities under tax receivable agreement, net of current portion 157,568 160,142 Total liabilities 558,071 358,577 Class A common stock, $0.01 par value per share - 300,000 shares authorized, 25,055 shares issued and outstanding as of March 31, 2025, 24,668 shares issued and outstanding as of December 31, 2024 251 247 Class B common stock, $0.01 par value per share - 50,000 shares authorized, 12,475 issued and outstanding as of March 31, 2025, 12,620 shares issued and outstanding as of December 31, 2024 125 126 Additional paid in capital 69,925 58,917 Accumulated deficit (158,845) (15,401)Total stockholders' equity (88,544) 43,889 Non-controlling interests (56,971) (4,813)Total equity (145,515) 39,076 Total liabilities and equity $412,556 $397,653 .Goosehead Insurance, Inc.Reconciliation of Non-GAAP Measures to GAAP This release includes certain financial performance measures that are not required by, nor presented in accordance with, generally accepted accounting principles in the United States (“GAAP”). The Company refers to these measures as “non-GAAP financial measures.” The Company uses these non-GAAP financial measures when planning, monitoring and evaluating its performance and considers these non-GAAP financial measures to be useful metrics for management and investors to facilitate operating performance comparisons from period to period by excluding potential differences caused by variations in capital structures, tax position, depreciation, amortization and certain other items that the Company believes are not representative of its core business. The Company uses these non-GAAP financial measures for business planning purposes and in measuring its performance relative to that of its competitors. These non-GAAP financial measures are defined by the Company as follows: "Core Revenue" is a supplemental measure of our performance and includes Renewal Commissions, Renewal Royalty Fees, New Business Commissions, New Business Royalty Fees, and Agency Fees. We believe that Core Revenue is an appropriate measure of operating performance because it summarizes all of our revenues from sales of individual insurance policies."Cost Recovery Revenue" is a supplemental measure of our performance and includes Initial Franchise Fees and Interest Income. We believe that Cost Recovery Revenue is an appropriate measure of operating performance because it summarizes revenues that are viewed by management as cost recovery mechanisms."Ancillary Revenue" is a supplemental measure of our performance and includes Contingent Commissions and Other Income. We believe that Ancillary Revenue is an appropriate measure of operating performance because it summarizes revenues that are ancillary to our core business."Adjusted EBITDA" is a supplemental measure of the Company's performance. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of items that do not relate to business performance. Adjusted EBITDA is defined as net income (the most directly comparable GAAP measure) before interest, income taxes, depreciation and amortization, adjusted to exclude equity-based compensation, impairment expense, and other non-operating items, including, among other things, certain non-cash charges and certain non-recurring or non-operating gains or losses."Adjusted EBITDA Margin" is Adjusted EBITDA as defined above, divided by total revenue. Adjusted EBITDA Margin is helpful in measuring profitability of operations on a consolidated level."Adjusted EPS" is a supplemental measure of our performance, defined as earnings per share (the most directly comparable GAAP measure) before non-recurring or non-operating income and expenses. Adjusted EPS is a useful measure to management and our investors because it eliminates the impact of items that do not relate to business performance and helps measure our profitability on a consolidated level.“Total operating expenses, excluding equity-based compensation, depreciation and amortization, and impairment expenses” is defined as total operating expenses (the most directly comparable GAAP measure) before equity-based compensation, depreciation and amortization, and impairment expenses. This measure is useful to management and our investors as it eliminates the impact of certain non-cash charges.“Employee compensation and benefits, excluding equity-based compensation” is defined as Employee compensation and benefits (the most directly comparable GAAP measure) before equity-based compensation. This measure is useful to management and our investors as it eliminates the impact of certain non-cash compensation charges.“General and administrative expenses, excluding impairment” is defined as general and administrative expenses (the most directly comparable GAAP measure) before impairment expense. This measure is useful to management and our investors as it eliminates the impact of certain non-cash charges. While the Company believes that these non-GAAP financial measures are useful in evaluating its business, this information should be considered as supplemental in nature and is not meant as a substitute for revenues, net income, or earnings per share, in each case as recognized in accordance with GAAP. In addition, other companies, including companies in the Company’s industry, may calculate such measures differently, which reduces their usefulness as comparative measures. The following tables show a reconciliation from total revenues to Core Revenue, Cost Recovery Revenue, and Ancillary Revenue (non-GAAP basis) for the three months ended March 31, 2025 and 2024 (in thousands): Three Months Ended March 31, 2025 2024 Total Revenues $75,583 $64,460 Core Revenue: Renewal Commissions(1) $16,952 $15,961 Renewal Royalty Fees(2) 37,244 29,053 New Business Commissions(1) 5,755 5,681 New Business Royalty Fees(2) 6,929 6,234 Agency Fees(1) 2,240 1,911 Total Core Revenue 69,120 58,839 Cost Recovery Revenue: Initial Franchise Fees(2) 1,342 2,245 Interest Income 189 250 Total Cost Recovery Revenue 1,531 2,495 Ancillary Revenue: Contingent Commissions(1) 4,476 2,668 Other Franchise Revenues(2) 456 458 Total Ancillary Revenue 4,932 3,126 Total Revenues $75,583 $64,460 (1) Renewal Commissions, New Business Commissions, Agency Fees, and Contingent Commissions are included in "Commissions and agency fees" as shown on the Condensed Consolidated Statements of Operations.(2) Renewal Royalty Fees, New Business Royalty Fees, Initial Franchise Fees, and Other Franchise Revenues are included in "Franchise revenues" as shown on the Condensed Consolidated Statements of Operations. The following tables show a reconciliation from net income to Adjusted EBITDA and Adjusted EBITDA Margin (non-GAAP basis) for the three months ended March 31, 2025 and 2024 (in thousands): Three Months Ended March 31, 2025 2024 Net Income $2,646 $1,809 Interest expense 5,823 1,487 Depreciation and amortization 2,670 2,568 Tax benefit (1,687) (8,568)Equity-based compensation 6,236 7,357 Impairment expense — 347 Other (income) expense (168) 6,727 Adjusted EBITDA $15,520 $11,727 Net Income Margin(1) 4 % 3 %Adjusted EBITDA Margin(2) 21 % 18 %(1) Net Income Margin is calculated as Net Income divided by Total Revenue ($2,646/$75,583) and ($1,809/$64,460) for the three months ended March 31, 2025 and 2024.(2) Adjusted EBITDA Margin is calculated as Adjusted EBITDA divided by Total Revenue ($15,520/$75,583), and ($11,727/$64,460) for the three months ended March 31, 2025 and 2024. The following tables show a reconciliation from basic earnings per share to Adjusted EPS (non-GAAP basis) for the three months ended March 31, 2025 and 2024. Note that totals may not sum due to rounding: Three Months Ended March 31, 2025 2024 Earnings per share - basic (GAAP) $0.09 $0.07 Add: equity-based compensation(1) 0.17 0.19 Add: impairment expense(2) — 0.01 Adjusted EPS (non-GAAP) $0.26 $0.28 (1) Calculated as equity-based compensation divided by sum of weighted average Class A and Class B shares [$6.2 million/(24.8 million + 12.6 million)] for the three months ended March 31, 2025 and [$7.4 million/ (25.1 million + 12.9 million)] for the three months ended March 31, 2024.(2) Calculated as impairment expense divided by sum of weighted average Class A and Class B shares [$0.3 million/(25.1 million + 12.9 million)] for the three months ended March 31, 2024. No impairment was recorded for the three months ended March 31, 2025. Goosehead Insurance, Inc.Key Performance Indicators March 31, 2025 December 31, 2024 March 31, 2024Corporate sales agents < 1 year tenured 254 253 138 Corporate sales agents > 1 year tenured 172 164 154 Operating franchises < 1 year tenured 100 90 133 Operating franchises > 1 year tenured 998 1,013 1,022 Total Franchise Producers 2,097 2,092 1,963 QTD Corporate Agent Productivity < 1 Year (1) $14,960 $12,787 $16,520 QTD Corporate Agent Productivity > 1 Year (1) $27,793 $26,788 $27,261 QTD Franchise Productivity < 1 Year (2) $13,904 $17,861 $16,736 QTD Franchise Productivity > 1 Year (2) $30,551 $29,089 $25,109 Policies in Force 1,729,000 1,674,000 1,528,000 Client Retention 84% 84% 85%Premium Retention 98% 98% 100%QTD Written Premium (in thousands) $1,000,231 $965,596 $818,785 Net Promoter Score ("NPS") 87 89 91 (1) - Corporate Productivity is New Business Production per Agent (Corporate): The New Business Revenue collected related to corporate sales, divided by the average number of full-time corporate sales agents for the same period. This calculation excludes interns, part-time sales agents and partial full-time equivalent sales managers.(2) - Franchise Productivity is New Business Production per Franchise: The gross commissions paid by Carriers and Agency Fees received related to policies in their first term sold by franchise sales agents, divided by the average number of franchises for the same period, prior to paying Royalty Fees to the Company.

Goosehead Insurance, Inc. Announces First Quarter 2025 Results

FAQ

Why Bullish?

How important is it?

Why Short Term?

Related Companies

Related News