RYAN SPECIALTY HOLDINGS, INC. Q1 FY2025 earnings call

• The first quarter was a strong start with 25% revenue growth, driven by 13% organic growth and 13% from M&A. Adjusted EBITDA grew 27.5% to $201 million. - Growth was driven by strength in casualty across specialties and modest growth in property. - Recent acquisitions like velocity and USQ Risk contributed to top-line growth. - The business model is resilient in the specialty and E&S market, with largely compulsory products and a differentiated platform. - Property saw pricing declines but retained share and had high renewal retention; casualty had strong new business and retention; delegated authority specialties are expanding product sets and capitalizing on panel consolidation.

Total revenue grew 25% in the first quarter, driven by 13% organic growth and 13 percentage points from M&A. Adjusted EBITDA grew 27.5% to $201 million, with an adjusted EBITDA margin expanding to 29.1%. Adjusted earnings per share grew 11.4% to $0.39. The wholesale brokerage specialty had double-digit top-line growth. Property had modest growth despite a challenging market, with pricing declines but strong retention and share gain. Casualty had strong new business and retention across habitational risks, transportation, construction, and healthcare. Delegated authority specialties: binding authority had a good start in 2025 with an expanding product set, and underwriting management had strong organic growth and M&A contributions.

• For 2025, organic revenue growth is expected to be between 11% and 13%. - Adjusted EBITDAC margin is expected to be between 32.5% and 33.5%. - Maintained guidance despite macro uncertainty, confident in the resilient business model.

• Elevated risks in the near and medium term due to global trade uncertainty, broader economy health, inflationary pressures, and capital markets.

Q: About revenue growth and M&A pipeline A: Tim Turner said the M&A pipeline is very robust with small, medium-sized, and large deals.

Q: On USQ risk acquisition and growth potential A: Pat Ryan said the acquisition of USQ Risk is strategic, adding differentiated talent and aligning with Nationwide Mutual for long-term organic growth.

Q: On technology spend and impact A: Tim Turner said they are streamlining and digitizing workflows, experimenting with AI to reduce cycle time and increase efficiency.

Q: On 2Q property comp and growth A: Janice Hamilton said Q2 is the largest property quarter, expecting modest growth in property with stronger casualty.

Q: On G&A ratio and compensation A: Janice Hamilton explained timing issues with benefits and investments, with G&A expected to continue on a similar trajectory.

Q: On relationship with carriers and underwriting management A: Tim Turner said the underwriting management business is well-received by carriers, aligned with their needs.

Q: On construction exposure and submission flow A: Tim Turner said construction results are strong, and they are taking share in property due to pricing pressure and consolidation opportunities.

Q: On M&A pipeline and leverage A: Pat Ryan and Janice Hamilton discussed the robust M&A pipeline and maintaining leverage flexibility in a buyer's market.