Brown & Brown (BRO) Q3 2024 earnings summary

Executive summary

• Q3 2024 total revenue reached $1.19 billion, up 11% year-over-year, with organic growth of 9.5% and strong performance across all segments.

• Net income attributable to the company rose 33% to $234 million, with diluted EPS up 30.6% to $0.81 and adjusted EPS up 12.3% to $0.91.

• Four acquisitions completed in Q3 contributed $7.5–8 million in annual revenue, supporting continued expansion.

• Board approved a 15% increase in projected dividend payments for Q4 2024, marking the 31st consecutive annual increase.

• CEO highlighted strong momentum and performance across the business.

Financial highlights

• Adjusted EBITDAC for Q3 2024 was $414 million, up 11.9%, with margin at 34.9%.

• Income before income taxes increased by 13.1% to $353 million (adjusted) and 31% to $317 million (GAAP), with margin up to 26.7%.

• Dividends declared per share increased 13% year-over-year to $0.13.

• Investment income surged 82.4% to $31 million in Q3 2024.

• Strong cash generation, with net cash from operations for nine months at $813 million.

Outlook and guidance

• Full-year EBITDA margin expected to be up at least 100 basis points for 2024 versus 2023.

• Q4 and early 2025 rates in admitted lines expected to be similar or slightly lower than Q3 2024; CAT property rates projected flat to down 10%.

• Free cash flow conversion ratio for 2024 raised due to deferred tax payments, with lower conversion expected in 2025.

• Management expects continued revenue growth from new business, renewals, and acquisitions, supported by strong liquidity.

• Pending acquisition of Quintes Holding B.V. expected to close in Q4 2024, funded by a $350 million draw on the revolving credit facility.