Hagerty Reports First Quarter 2025 Results; Reaffirms 2025 Outlook for Revenue and Profit Growth
PR Newswire
TRAVERSE CITY, Mich., May 7, 2025
-- First quarter 2025 Total Revenue increased 18% year-over-year to $319.6
million
-- First quarter 2025 Written Premium increased 12% year-over-year to $244.3
million
-- First quarter 2025 Marketplace revenue increased 176% year-over-year to
$29.0 million
-- First quarter 2025 Operating Income increased 110% year-over-year to
$25.7 million
-- First quarter 2025 Operating Income margin increased by 360 bps
compared to the prior year period
-- First quarter 2025 Net Income increased 233% year-over-year to $27.3
million
-- First quarter 2025 Adjusted EBITDA increased 45% year-over-year to $39.6
million
-- Reaffirmed 2025 Outlook for 12-13% Total Revenue growth, 30-40% Net
Income growth and 21-29% Adjusted EBITDA growth
TRAVERSE CITY, Mich., May 7, 2025 /PRNewswire/ -- Hagerty, Inc. $(HGTY)$, an automotive enthusiast brand and leading specialty vehicle insurance provider, announced today financial results for the three months ended March 31, 2025.
"We are off to a solid start to 2025, with first quarter revenue growth of 18%, net income growth of 233%, and Adjusted EBITDA growth of 45%. We expanded our margins and are making substantial technology investments to become even more efficient in how we deliver on our brand promise to members over the coming years," said McKeel Hagerty, Chief Executive Officer and Chairman of Hagerty.
"Hagerty enjoys the enviable position of operating in an industry that has historically performed well regardless of the economic cycle. Our industry-leading retention delivers visible revenue streams that are augmented by consistently high rates of new member growth thanks to the strength of the Hagerty brand and value proposition. Our strategic priorities enable us to acquire new customers and service existing ones more efficiently than ever, and we are well-positioned for accelerating growth as we move into 2026," continued Mr. Hagerty.
"Our business momentum and first quarter results keep us on track to deliver 12-13% total revenue growth in 2025 as we help car enthusiasts protect, buy and sell, and enjoy their special vehicles. Operating margin expansion should drive even faster rates of bottom-line growth, with net income expected to increase by 30-40% compared to 2024," added Mr. Hagerty.
FIRST QUARTER 2025 FINANCIAL HIGHLIGHTS
-- First quarter 2025 Total Revenue increased 18% year-over-year to $319.6
million
-- First quarter 2025 Written Premium increased 12% year-over-year to $244.3
million
-- First quarter 2025 Commission and fee revenue increased 13%
year-over-year to $100.3 million
-- Policies in Force Retention was 89.0% as of March 31, 2025
compared to 88.7% in the prior year period, and total insured
vehicles increased 8% year-over-year to 2.6 million
-- First quarter 2025 Loss Ratio was 42.0% including 6.7% of impact from
catastrophe losses (including approximately $10.4 million in pre-tax
losses from the Southern California wildfires), compared to 41.1% in the
prior year period
-- First quarter 2025 Earned Premium increased 12% year-over-year to $169.4
million
-- First quarter 2025 Membership, marketplace and other revenue increased
60% year-over-year to $50.0 million
-- First quarter 2025 Marketplace revenue increased 176%
year-over-year to $29.0 million
-- The increase was primarily due to a higher level of
inventory sales, including cars sold in February 2025 from
the Academy of Art University Collection
-- First quarter 2025 Membership revenue increased 14% year-over-year
to $15.3 million
-- Hagerty Drivers Club (HDC) paid members increased 7%
year-over-year to approximately 889,000 compared to 831,000
-- First quarter 2025 Operating Income of $25.7 million, an increase of
$13.5 million compared to the prior year period
-- First quarter 2025 Operating Income margin increased by 360 bps
compared to the prior year period
-- General and administrative expenses increased 11.7% due
primarily to an increase in software-related costs, and
Salary and benefits increased 5.3%
-- First quarter 2025 depreciation and amortization was $9.5 million
compared to $10.6 million in the prior year period
-- First quarter 2025 Net Income of $27.3 million, an increase of $19.1
million compared to the prior year period
-- First quarter 2025 Net Income includes $7.1 million in interest
and other income
-- First quarter 2025 Adjusted EBITDA (a non-GAAP measure) of $39.6 million,
an increase of $12.3 million compared to the prior year period
-- First quarter 2025 Basic and Diluted Earnings per Share was $0.07
-- First quarter 2025 Adjusted EPS (a non-GAAP measure) was $0.08
-- We ended the quarter with $128 million of cash and $147 million of total
debt, $32 million of which is back leverage for Broad Arrow Capital's
portfolio of loans collateralized by collector cars
-- We increased the borrowing capacity under our unsecured credit
facility to $375 million with lower borrowing costs and a March
2030 maturity
The definitions and reconciliations of non-GAAP financial measures are provided under the heading Key Performance Indicators and Certain Non-GAAP Financial Measures at the end of this press release.
2025 OUTLOOK - SUSTAINED GROWTH AND PROFITABILITY
We believe 2025 is on track to be another year of strong profit growth for Hagerty as our team executes on our long-term plan to create value for stakeholders by delivering high rates of compounding revenue growth through investing in our long-term competitive advantages. In 2025, these investments aggregate to $20 million of elevated spend, primarily in our new technology platform, Duck Creek. Duck Creek will help us efficiently grow our business over the coming years. We remain focused on growing our Insurance, Membership and Marketplace businesses, positioning us to deliver sustained, compounding profit growth over the coming years, and fund our purpose to save driving and fuel car culture for future generations.
-- For full year 2025, Hagerty anticipates:
-- Written Premium growth of 13-14%
-- Total Revenue growth of 12-13%
-- Net Income growth of 30-40%
-- Adjusted EBITDA growth of 21-29%
-- Profit ranges incorporate $20 million of elevated
technology investments in 2025, as well as an estimated $10
million pre-tax impact from the Southern California
wildfires
2025 Outlook ($) 2025 Outlook (%)
in 2024
thousands Results Low End High End Low End High End
---------- ---------- ---------- ---------- -------- --------
Total
Written
Premium $1,044,492 $1,180,000 $1,191,000 13 % 14 %
Total
Revenue $1,200,038 $1,344,000 $1,356,000 12 % 13 %
Net Income
(1) $78,303 $102,000 $110,000 30 % 40 %
Adjusted
EBITDA
(2) $124,473 $150,000 $160,000 21 % 29 %
---------- ---------- -------- --------
(1) Fully diluted share count of approximately 360 million shares including
Class A Common Stock, Class V Common Stock, Series A Convertible
Preferred Stock, and share-based compensation awards.
(2) See Non-GAAP Financial Measures below for additional information
regarding this non-GAAP financial measure.
Conference Call Details
Hagerty will hold a conference call to discuss the financial results today at 10:00 am Eastern Time. A webcast of the conference call, including its Investor Presentation highlighting first quarter 2025 financial results, will be available on Hagerty's investor relations website at investor.hagerty.com. The dial-in for the conference call is (877) 423-9813 (toll-free) or (201) 689-8573 (international). Please dial the number 10 minutes prior to the scheduled start time.
A webcast replay of the call will be available at investor.hagerty.com following the call.
Forward-Looking Statements
This press release contains statements that constitute "forward-looking statements" within the meaning of the federal securities laws. All statements provided, other than statements of historical fact, are forward-looking statements, including those regarding Hagerty's future operating results and financial position, Hagerty's business strategy and plans, products, services, and technology implementations, market conditions, growth and trends, expansion plans and opportunities, and Hagerty's objectives for future operations. The words "anticipate," "believe," "envision," "estimate," "expect," "intend," "may," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue," "ongoing," "contemplate," and similar expressions, and the negative of these expressions, are intended to identify forward-looking statements.
Hagerty has based these forward-looking statements largely on current expectations about future events, which may not materialize. Actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. These factors include, among other things, Hagerty's ability to: (i) compete effectively within our industry and attract and retain our insurance policyholders and paid Hagerty Drivers Club ("HDC") subscribers; (ii) maintain key strategic relationships with our insurance distribution and underwriting carrier partners; (iii) prevent, monitor, and detect fraudulent activity; (iv) manage risks associated with disruptions, interruptions, outages or other issues with our technology platforms or our use of third-party services; (v) accelerate the adoption of our membership and marketplace products and services, as well as any new insurance programs and products we offer; (vi) manage the cyclical nature of the insurance business, including through any periods of recession, economic downturn or inflation; (vii) address unexpected increases in the frequency or severity of claims, and (viii) comply with the numerous laws and regulations applicable to our business, including state, federal and foreign laws relating to insurance and rate increases, privacy, the internet, and accounting matters.
The forward-looking statements herein represent the judgment of Hagerty as of the date of this release and Hagerty disclaims any intent or obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise. This press release should be read in conjunction with the information included in the Hagerty's other press releases, reports and other filings with the Securities and Exchange Commission. Understanding the information contained in these filings is important in order to fully understand Hagerty's reported financial results and its business outlook for future periods.
About Hagerty, Inc. (NYSE: HGTY)
Hagerty is an automotive enthusiast brand committed to saving driving and to fueling car culture for future generations. The company is a leading provider of specialty vehicle insurance, expert car valuation data and insights, live and digital car auction services, immersive events and automotive entertainment custom made for the 67 million Americans who self-describe as car enthusiasts. Hagerty also operates in Canada and the U.K. and is home to Hagerty Drivers Club, a community of nearly 890,000 who can't get enough of cars. For more information, please visit www.hagerty.com or connect with us on Facebook, Instagram, Twitter and LinkedIn..
More information can be found at newsroom.hagerty.com.
Category: Financial
Source: Hagerty
Hagerty, Inc.
Condensed Consolidated Statements of Operations (Unaudited)
Three months ended March 31,
2025 2024 $ Change % Change
--------------- --------------- -------------- ---------
REVENUE: in thousands (except percentages and per share amounts)
Commission and
fee revenue $ 100,287 $ 88,840 $ 11,447 12.9 %
Earned premium 169,355 151,619 17,736 11.7 %
Membership,
marketplace and
other revenue 49,951 31,249 18,702 59.8 %
--------------- --------------- -------------- ---------
Total revenue 319,593 271,708 47,885 17.6 %
--------------- --------------- -------------- ---------
OPERATING
EXPENSES:
Salaries and
benefits 59,103 56,116 2,987 5.3 %
Ceding
commissions,
net 77,333 70,930 6,403 9.0 %
Losses and loss
adjustment
expenses 71,130 62,356 8,774 14.1 %
Sales expense 54,626 39,660 14,966 37.7 %
General and
administrative
expenses 22,185 19,862 2,323 11.7 %
Depreciation and
amortization 9,488 10,560 (1,072) (10.2) %
--------------- --------------- -------------- ---------
Total operating
expenses 293,865 259,484 34,381 13.2 %
--------------- --------------- -------------- ---------
OPERATING
INCOME 25,728 12,224 13,504 110.5 %
Loss related to
warrant
liabilities,
net -- (6,140) 6,140 (100.0) %
Interest and
other income
(expense), net 7,054 7,244 (190) (2.6) %
--------------- --------------- -------------- ---------
INCOME BEFORE
INCOME TAX
EXPENSE 32,782 13,328 19,454 146.0 %
Income tax
expense (5,489) (5,129) $(360.AU)$ 7.0 %
--------------- --------------- -------------- ---------
NET INCOME 27,293 8,199 19,094 232.9 %
--------------- --------------- -------------- ---------
Net income
attributable to
non-controlling
interest (18,922) (9,550) (9,372) 98.1 %
Accretion of
Series A
Convertible
Preferred Stock (1,875) (1,838) (37) 2.0 %
--------------- --------------- -------------- ---------
NET INCOME
(LOSS)
ATTRIBUTABLE
TO CLASS A
COMMON
STOCKHOLDERS $ 6,496 $ (3,189) $ 9,685 303.7 %
=============== =============== ============== =========
Earnings (loss)
per share of Class
A Common Stock:
Basic $ 0.07 $ (0.04)
Diluted $ 0.07 $ (0.04)
Weighted average
shares of Class A
Common Stock
outstanding:
Basic 90,047 84,656
Diluted 346,311 84,656
Hagerty, Inc.
Condensed Consolidated Balance Sheets (Unaudited)
March 31, December 31,
2025 2024
-------------------------- ---------------------------
ASSETS in thousands (except share amounts)
Current Assets:
Cash and cash equivalents $ 127,704 $ 104,784
Restricted cash and cash
equivalents 158,604 128,061
Investments 104,991 73,957
Accounts receivable 97,610 84,763
Premiums receivable 175,522 153,748
Commissions receivable 17,135 20,430
Notes receivable 62,053 45,417
Deferred acquisition
costs, net 152,270 156,466
Other current assets 102,044 90,779
-------------------------- ---------------------------
Total current assets 997,933 858,405
Investments 481,115 515,570
Notes receivable 11,139 11,555
Property and equipment, net 17,919 18,205
Lease right-of-use assets 43,433 44,485
Intangible assets, net 87,122 90,107
Goodwill 114,127 114,123
Other long-term assets 63,403 56,888
-------------------------- ---------------------------
TOTAL ASSETS $ 1,816,191 $ 1,709,338
========================== ===========================
LIABILITIES, TEMPORARY
EQUITY AND STOCKHOLDERS'
EQUITY
Current Liabilities:
Accounts payable, accrued
expenses and other
current liabilities $ 116,875 $ 73,383
Losses payable and
provision for unpaid
losses and loss
adjustment expenses 251,920 266,878
Commissions payable 79,315 77,389
Advance premiums and due
to insurers 154,009 108,352
Unearned premiums 352,162 357,539
Contract liabilities 32,778 31,905
-------------------------- ---------------------------
Total current
liabilities 987,059 915,446
Long-term lease liabilities 41,956 43,178
Long-term debt, net 132,596 104,968
Deferred tax liability 18,421 18,065
Contract liabilities 14,834 15,334
Other long-term liabilities 2,130 4,178
-------------------------- ---------------------------
TOTAL LIABILITIES 1,196,996 1,101,169
-------------------------- ---------------------------
Commitments and
Contingencies -- --
TEMPORARY EQUITY (1)
Preferred stock, $0.0001
par value (20,000,000
shares authorized,
8,483,561 Series A
Convertible Preferred
Stock issued and
outstanding as of
March 31, 2025 and
December 31, 2024) 86,538 84,663
STOCKHOLDERS' EQUITY
Class A Common Stock,
$0.0001 par value
(500,000,000 shares
authorized, 90,064,663
and 90,032,391 issued and
outstanding as of
March 31, 2025 and
December 31, 2024,
respectively) 9 9
Class V Common Stock,
$0.0001 par value
(300,000,000 authorized,
251,033,906 shares issued
and outstanding as of
March 31, 2025 and
December 31, 2024) 25 25
Additional paid-in capital 606,972 603,780
Accumulated earnings
(deficit) (443,607) (451,978)
Accumulated other
comprehensive income
(loss) (455) (1,514)
-------------------------- ---------------------------
Total stockholders' equity 162,944 150,322
-------------------------- ---------------------------
Non-controlling interest 369,713 373,184
-------------------------- ---------------------------
Total equity 532,657 523,506
-------------------------- ---------------------------
TOTAL LIABILITIES,
TEMPORARY EQUITY AND
STOCKHOLDERS' EQUITY $ 1,816,191 $ 1,709,338
========================== ===========================
(1) The Series A Convertible Preferred Stock is recorded within Temporary
Equity because it has equity conversion and cash redemption features.
Hagerty, Inc.
Condensed Consolidated Statements of Cash Flows (Unaudited)
Three months ended March 31,
-----------------------------------------------------
2025 2024
------------------------- --------------------------
OPERATING ACTIVITIES: in thousands
Net income $ 27,293 $ 8,199
Adjustments to
reconcile net income
to net cash from
operating
activities:
Loss on disposals of
equipment, software
and other assets 1,136 --
Loss related to
warrant
liabilities, net -- 6,140
Depreciation and
amortization 9,488 10,560
Provision for
deferred taxes (939) (571)
Share-based
compensation
expense 4,392 4,543
Non-cash lease
expense 2,109 2,197
Realized (gain) loss
on investments, net 315 --
(Accretion)
amortization of
discount and
premium, net (1,184) --
Other 1,852 1,140
Changes in operating
assets and
liabilities:
Accounts, premiums
and commissions
receivable (39,394) 42,736
Deferred acquisition
costs, net 4,196 4,712
Losses payable and
provision for
unpaid losses and
loss adjustment
expenses (14,958) 5,567
Commissions payable 1,926 (37,669)
Advance premiums and
due to insurers 45,257 34,941
Unearned premiums (5,377) (4,573)
Operating lease
assets and
liabilities (2,252) (2,282)
Other assets and
liabilities, net 9,970 (17,402)
------------------------- --------------------------
Net Cash Provided
by Operating
Activities 43,830 58,238
------------------------- --------------------------
INVESTING ACTIVITIES:
Capital expenditures (5,389) (4,538)
Acquisitions, net of
cash acquired, and
other investments -- (3,843)
Issuance of notes
receivable (9,886) (17,828)
Collection of notes
receivable 1,650 11,041
Purchases of fixed
maturity
securities (39,150) (2,956)
Proceeds from sales
of fixed maturity
securities 14,804 --
Proceeds from
maturities of fixed
maturity
securities 33,722 1,075
Purchases of equity
securities (246) --
Sales of equity
securities 247 --
Other investing
activities (233) (1,238)
------------------------- --------------------------
Net Cash Used in
Investing
Activities (4,481) (18,287)
------------------------- --------------------------
FINANCING ACTIVITIES:
Payments on
long-term debt (120,880) (45,331)
Proceeds from
long-term debt, net
of issuance costs 160,067 8,098
Distributions paid
to non-controlling
interest unit
holders (24,676) --
Funding of TRA
liability payments (223) --
Funding of employee
tax obligations upon
vesting of
share-based
payments (44) --
------------------------- --------------------------
Net Cash Provided
by (Used in)
Financing
Activities 14,244 (37,233)
------------------------- --------------------------
Effect of exchange
rate changes on cash
and cash equivalents
and restricted cash
and cash
equivalents (130) (186)
Change in cash and
cash equivalents and
restricted cash and
cash equivalents 53,463 2,532
Beginning cash and
cash equivalents and
restricted cash and
cash equivalents 232,845 724,276
------------------------- --------------------------
Ending cash and cash
equivalents and
restricted cash and
cash equivalents $ 286,308 $ 726,808
========================= ==========================
Hagerty, Inc.
Key Performance Indicators and Certain Non-GAAP Financial Measures
Key Performance Indicators
The tables below present a summary of our Key Performance Indicators, which include important operational metrics, as well as certain financial measures prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") and non-GAAP financial measures. We use these Key Performance Indicators to evaluate our business, measure our performance, identify trends against planned initiatives, prepare financial projections, and make strategic decisions. We believe these Key Performance Indicators are useful in evaluating our performance when read together with our Condensed Consolidated Financial Statements prepared in accordance with GAAP.
Three months ended March 31,
2025 2024 Change
------------- -------------- ----------------------
Operational
Metrics dollars in thousands (except per share amounts)
Total Written
Premium $ 244,327 $ 218,286 $ 26,041 11.9 %
Hagerty Re
Loss Ratio 42.0 % 41.1 % 0.9 % N/M
Hagerty Re
Combined
Ratio 88.5 % 88.5 % -- % N/M
New Business
Count --
Insurance 55,309 59,286 (3,977) (6.7) %
GAAP Financial
Measures
Total Revenue $ 319,593 $ 271,708 $ 47,885 17.6 %
Operating
Income $ 25,728 $ 12,224 $ 13,504 110.5 %
Net Income $ 27,293 $ 8,199 $ 19,094 232.9 %
Basic Earnings
(Loss) Per
Share $ 0.07 $ (0.04) $ 0.11 N/M
Diluted
Earnings
(Loss) Per
Share $ 0.07 $ (0.04) $ 0.11 N/M
Non-GAAP
Financial
Measures
Adjusted
EBITDA $ 39,608 $ 27,327 $ 12,281 44.9 %
Adjusted
Earnings Per
Share $ 0.08 $ 0.04 $ 0.04 100.0 %
N/M = Not meaningful
March 31, December 31,
2025 2024 Change
--------- ------------ -------------
Operational Metrics
Policies in Force 1,524,927 1,506,451 18,476 1.2 %
Policies in Force Retention 89.0 % 89.0 % -- % -- %
Vehicles in Force 2,609,209 2,576,700 32,509 1.3 %
HDC Paid Member Count 889,390 875,822 13,568 1.5 %
Net Promoter Score (NPS) 82 82 -- -- %
Non-GAAP Financial Measures
Adjusted EBITDA
We define Adjusted EBITDA as consolidated Net income, excluding net interest and other income (expense), income tax expense, and depreciation and amortization, further adjusted to exclude (i) net gains and losses related to our warrant liabilities prior to the Warrant Exchange; (ii) share-based compensation expense; and when applicable, (iii) restructuring, impairment and related charges; (iv) gains, losses and impairments related to divestitures; and (v) certain other unusual items.
We present Adjusted EBITDA because we consider it to be an important supplemental measure of our performance and believe it is frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. We use Adjusted EBITDA as a measure of the operating performance of our business on a consistent basis, as it removes the impact of items not directly resulting from our core operations.
By providing this non-GAAP financial measure, together with a reconciliation to Net income, which is the most comparable GAAP measure, we believe we are enhancing investors' understanding of our business and our results of operations, as well as assisting investors in evaluating how well we are executing our strategic initiatives. However, Adjusted EBITDA has limitations as an analytical tool, and should not be considered in isolation, or as an alternative to, or a substitute for Net income or other financial statement data presented in our Condensed Consolidated Financial Statements as indicators of financial performance. Our definition of Adjusted EBITDA may be different than similarly titled measures used by other companies in our industry, which could reduce the usefulness of this non-GAAP financial measure when comparing our performance to that of other companies.
The following table reconciles Adjusted EBITDA to the most directly comparable GAAP measure, which is Net income:
Three months ended
March 31,
---------------------------------------
2025 2024
------------------ -------------------
in thousands
Net income $ 27,293 $ 8,199
Interest and other (income)
expense (1, 2) (7,054) (7,244)
Income tax expense 5,489 5,129
Depreciation and amortization 9,488 10,560
------------------ -------------------
EBITDA 35,216 16,644
Loss related to warrant
liabilities, net -- 6,140
Share-based compensation expense 4,392 4,543
Adjusted EBITDA $ 39,608 $ 27,327
================== ===================
(1) Excludes interest expense related to the BAC Credit Facility, which is
recorded within "Sales expense" in the Condensed Consolidated Statements
of Operations.
(2) Includes interest income and net investment income related to our
investment portfolio.
The following table reconciles Adjusted EBITDA for the year ended December 31, 2025 Outlook to the most directly comparable GAAP measure, which is Net income:
2025 Low 2025 High
------------------ ------------------
in thousands
Net income $ 102,000 $ 110,000
Interest and other (income)
expense (1, 2) (32,000) (32,000)
Income tax expense 21,000 23,000
Depreciation and amortization 39,000 39,000
Share-based compensation expense 20,000 20,000
------------------ ------------------
Adjusted EBITDA $ 150,000 $ 160,000
================== ==================
(1) Excludes interest expense related to the BAC Credit Facility, which is
recorded within "Sales expense" in the Condensed Consolidated Statements
of Operations.
(2) Includes interest income and net investment income related to our
investment portfolio.
Adjusted EPS
We define Adjusted Earnings Per Share ("Adjusted EPS") as consolidated Net income, excluding net gains and losses related to our warrant liabilities prior to the Warrant Exchange, divided by our outstanding and total potentially dilutive securities, which includes (i) the weighted average issued and outstanding shares of Class A Common Stock; (ii) all issued and outstanding non-controlling interest units of THG; (iii) all issued and outstanding shares of our Series A Convertible Preferred Stock on an as-converted basis; (iv) all unissued share-based compensation awards; and (v) all unexercised warrants outstanding prior to the Warrant Exchange.
The most directly comparable GAAP measure to Adjusted EPS is basic earnings per share ("Basic EPS"), which is calculated as Net income (loss) available to Class A Common Stockholders divided by the weighted average number of Class A Common Stock shares outstanding during the period.
We present Adjusted EPS because we consider it to be an important supplemental measure of our operating performance and believe it is used by securities analysts, investors and other interested parties in evaluating the consolidated performance of other companies in our industry. We also believe that Adjusted EPS, which compares our consolidated Net income with our outstanding and potentially dilutive shares, provides useful information to investors regarding our performance on a fully consolidated and fully diluted basis.
Management uses Adjusted EPS:
-- as a measurement of operating performance of our business on a fully
consolidated and fully diluted basis;
-- to evaluate the performance and effectiveness of our operational
strategies; and
-- as a preferred predictor of core operating performance, comparisons to
prior periods and competitive positioning.
We caution investors that Adjusted EPS is not a recognized measure under GAAP and should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, including Basic EPS, and that Adjusted EPS, as we define it, may be defined or calculated differently by other companies. In addition, Adjusted EPS has limitations as an analytical tool and should not be considered as a measure of profit or loss per share.
The following table reconciles Adjusted EPS to the most directly comparable GAAP measure, which is Basic EPS:
Three months ended
March 31,
-------------------------------------------
2025 2024
-------------------- ---------------------
in thousands (except per share amounts)
Numerator:
Net income (loss) available
to Class A Common
Stockholders (1) $ 6,041 $ (3,189)
Accretion of Series A
Convertible Preferred
Stock 1,875 1,838
Undistributed earnings
allocated to Series A
Convertible Preferred Stock 455 --
Net income attributable to
non-controlling interest 18,922 9,550
-------------------- ---------------------
Consolidated net income 27,293 8,199
-------------------- ---------------------
Loss related to warrant
liabilities, net -- 6,140
-------------------- ---------------------
Adjusted consolidated net
income (2) $ 27,293 $ 14,339
==================== =====================
Denominator:
Weighted average shares of
Class A Common Stock
outstanding (1) 90,047 84,656
Total potentially dilutive
securities outstanding:
Non-controlling interest
THG units 255,154 255,499
Series A Convertible
Preferred Stock, on an
as-converted basis 6,785 6,785
Total unissued share-based
compensation awards 7,935 8,256
Total warrants outstanding -- 19,484
-------------------- ---------------------
Potentially dilutive
shares outstanding 269,874 290,024
-------------------- ---------------------
Fully dilutive shares
outstanding (2) 359,921 374,680
==================== =====================
Basic EPS (1) $ 0.07 $ (0.04)
Adjusted EPS (2) $ 0.08 $ 0.04
(1) Numerator and Denominator of the GAAP measure Basic EPS
(2) Numerator and Denominator of the non-GAAP measure Adjusted EPS
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SOURCE Hagerty
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May 07, 2025 07:00 ET (11:00 GMT)
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