Ryan Specialty highlights revenue growth in first quarter results | Insurance Business America
CEO touts “double-digit organic growth” to kick off 2024
Insurance News
By
Kenneth Araullo
Ryan Specialty has disclosed its financial results for the first quarter ending March 31.
The company reported a 20.6% increase in total revenue to $552 million, up from $457.6 million in the corresponding period last year. This growth was driven primarily by a 13.7% increase in organic revenue, using a revised calculation methodology initiated this quarter.
Contributing factors include new client acquisitions, enhanced relationships with existing clients, expansion in the E&S market, revenues from recent acquisitions, and an uptick in Fiduciary investment income.
Operating expenses for the quarter rose 23.7% to $479.4 million, influenced by higher compensation and benefits expenses aligned with revenue growth and restructuring costs related to the ACCELERATE 2025 initiative.
Despite these increases, savings from this program helped offset some expenses. General and administrative expenses also climbed due to more professional services, increased travel, entertainment expenses, and higher acquisition-related expenses.
The firm saw an 11.6% increase in net income, reaching $40.7 million, compared to $36.5 million in the first quarter of the previous year. Adjusted EBITDAC rose 25.8% to $157.2 million, with its margin expanding to 28.5% from 27.3% a year earlier.
Adjusted net income saw a significant rise of 32.9%, amounting to $95.4 million, while the adjusted net income margin improved to 17.3% from 15.7%. Adjusted diluted earnings per share increased by 34.6% to $0.35, up from $0.26 in the prior-year period.
ACCELERATE 2025 and Ryan Specialty’s outlook
As of the end of the quarter, Ryan Specialty reported cash and cash equivalents of $665.4 million and an outstanding debt principal of $2.0 billion. The company also announced updates to its ACCELERATE 2025 restructuring program, anticipating approximately $110 million in cumulative one-time charges through 2024, with expected annual savings of about $60 million in 2025.
Patrick G Ryan, founder, chairman, and chief executive officer of Ryan Specialty, reflected positively on the quarter’s achievements.
“We had a great start to 2024, driven by another quarter of double-digit organic growth and further enhancement of our margin profile,” he said.
“Our outstanding success continues to be broad-based across our specialties and includes valuable contributions from our recent acquisitions,” Ryan said. “This momentum is a reflection of the resolve of our 4,400 talented teammates to execute with distinction and to provide best-in-class service to our clients and trading partners.
“We are also very pleased to have announced just yesterday the completion of our acquisition of Castel and the addition of this venerable team to our firm. This influx of additional top underwriting talent bolsters our delegated authority offering, enhances our international presence, and expands our total addressable market. I remain confident that 2024 will be another outstanding year for our firm as we are well positioned to deliver sustainable and differentiated profitable growth,” he said.
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