Executive Summary

Q4 2023 total revenues were $284.6M (+16% YoY), Organic Revenue Growth 15%, Adjusted EBITDA $45.6M (16% margin), and GAAP diluted loss per share of $0.56; Adjusted Diluted EPS was $0.14 .
Management guided Q1 2024 revenue to $370–$380M, Adjusted EBITDA $95–$100M, Adjusted EPS $0.51–$0.55; FY 2024 revenue $1.35–$1.40B, Adjusted EBITDA $315–$330M, FCF $165–$195M, with organic growth toward the upper end of 10–15% .
BRP divested its wholesale brokerage (Connected Risk Solutions) for ~$59M cash; management expects EPS-neutral and accretive effects to organic growth and EBITDA margin in 2024 .
S&P Global Wall Street consensus estimates were unavailable due to a mapping error, so formal beat/miss vs consensus cannot be verified; we anchor results on company filings and the earnings call [SpgiEstimatesError].

What Went Well and What Went Wrong

What Went Well

Strong double-digit organic growth: Q4 Organic Revenue Growth 15% and FY 2023 organic growth 19% demonstrate durable demand across segments .
Expense rationalization and operating leverage: Management emphasized entering 2024 “well-positioned to deliver another year of profitable double-digit organic growth, while meaningfully accelerating expanding margins and free cash flow” .
Portfolio simplification: Sale of Connected Risk Solutions for ~$59M, expected EPS-neutral and accretive to organic growth and margin, sharpening focus on core retail and MGA businesses .

What Went Wrong

Margin compression vs prior quarter: Adjusted EBITDA margin declined to 16% in Q4 from 21% in Q3 amid severance and integration costs; Adjusted EBITDA fell to $45.6M from $64.0M .
Continued GAAP losses: Q4 GAAP net loss was $62.5M (diluted loss per share $0.56), reflecting higher interest expense and non-cash charges (e.g., change in fair value of contingent consideration) .
Segment deceleration in IAS: Management cited IAS organic growth of 9% in Q4 vs >20% in other segments, noting a slowdown in the second half of the year and expecting rate tailwinds to ebb in 2024 .

Financial Results

Metric	Q2 2023	Q3 2023	Q4 2023
Revenue ($USD Millions)	$297.2	$306.3	$284.6
GAAP Diluted EPS ($)	$(0.40)	$(0.29)	$(0.56)
Adjusted Diluted EPS ($)	$0.27	$0.29	$0.14
Adjusted EBITDA ($USD Millions)	$61.6	$64.0	$45.6
Adjusted EBITDA Margin (%)	21%	21%	16%
Organic Revenue Growth (%)	22%	19%	15%
GAAP Net Income (Loss) ($USD Millions)	$(43.7)	$(32.0)	$(62.5)
YoY Revenue Growth (%)	+28%	+18%	+16%

Notes: Q4 revenue reflects “Total revenues,” which includes $2.1M investment income; Q2/Q3 “Revenue” aligns to commissions and fees disclosures in those releases .

Segment KPIs (Q4 2023):

Segment	Q2 2023	Q3 2023	Q4 2023
IAS Organic Growth (%)	N/A	N/A	9%
UCTS Organic Growth (%)	N/A	N/A	22%
MIS Organic Growth (%)	N/A	N/A	21%

Liquidity and leverage:

KPI	Q2 2023	Q3 2023	Q4 2023
Cash & Cash Equivalents ($M)	$105.5	$79.0	$116.2
Revolver Borrowing Capacity ($M)	$130.0	$276.0	$259.0
Leverage (Management Comment)	—	4.8x	—

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($M)	Q1 2024	Reiterated from Q3 call (not quantified in our sources)	$370–$380	Maintained ranges; explicit Q1 detail provided
Adjusted EBITDA ($M)	Q1 2024	Reiterated	$95–$100	Maintained ranges
Adjusted EPS ($)	Q1 2024	Reiterated	$0.51–$0.55	Maintained ranges
Revenue ($B)	FY 2024	Reiterated from Q3; adjusted for divestiture	$1.35–$1.40	Maintained; adjusted for sale of Connected Risk Solutions
Adjusted EBITDA ($M)	FY 2024	Reiterated; adjusted	$315–$330	Maintained; adjusted
Free Cash Flow ($M)	FY 2024	Reiterated; adjusted	$165–$195	Maintained; adjusted
Organic Growth (%)	FY 2024	Upper end of 10–15% long-term range	Upper end of 10–15%	Maintained

Divestiture impact: Connected Risk Solutions sale expected to be neutral to 2024 adjusted EPS; accretive to organic growth and Adjusted EBITDA margin .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3)	Current Period (Q4)	Trend
Operating leverage & margins	“Adjusted EBITDA Margin(3) of 21%” (Q2); “~480 bps margin accretion YoY” and leverage at 4.8x (Q3)	Margin 16%; management expects margin expansion in 2024 via expense rationalization and lower one-time costs	Improving in 2024 (forward)
Organic growth	22% (Q2) and 19% (Q3) organic growth	15% in Q4; FY 2023 19%; 2024 aiming upper end of 10–15%	Normalizing from elevated
Portfolio actions	No divestitures highlighted; continued integrations (Q2/Q3)	Sale of Connected Risk Solutions (~$59M) closing Mar 1	Streamlining/Focus
Segment dynamics	Not disclosed by segment (Q2/Q3 releases)	IAS 9%, UCTS 22%, MIS 21% organic growth in Q4	Mixed; IAS slower
Macro/rates	Strong rate tailwinds in 2023	Expect rate impact to ebb; demand resilient; dislocation persists in parts of insurance	Moderating
Florida reforms / MGA	MGA “of the future” growth >30% in 2023; Florida reforms positive for Westwood distribution	Continued momentum with new builders and product expansion	Positive

Management Commentary

“We capped 2023 with another solid quarter of double-digit organic growth…entered 2024 well-positioned to deliver another year of profitable double-digit organic growth, while meaningfully accelerating expanding margins and free cash flow…” – Trevor Baldwin, CEO .
“We have executed a definitive agreement for the sale of our wholesale brokerage platform, Connected Risk Solutions, to Amwins…expected to be neutral to 2024 adjusted EPS, and accretive to both 2024 organic growth and Adjusted EBITDA margin.” – Prepared remarks .
“Connected finished 2023 at approximately $34 million of gross revenue and $5 million of Adjusted EBITDA…cash proceeds…approximately $59 million.” – CFO remarks .
“Industry median sales velocity was 11.6%, 75th percentile 15.7%…momentum in the IAS business continues to be very strong.” – Prepared remarks .

Q&A Highlights

Segment outlook: Expect double-digit organic growth across all segments in 2024; IAS growth slowed in 2H23 but momentum remains .
MGA platform expansion: MGA of the future grew >30% in 2023; renters remains strong (>20%); added homeowners and flood ($360M premium; ~$65M revenue in 2023); expanding distribution and software partners .
Connected Risk Solutions: Limited seasonality; ~$59M proceeds to enhance financial flexibility; EPS-neutral, margin/organic-growth accretive .
Florida reforms: Positive for Westwood; adding top builders and increased capacity optionality, supportive of growth .
Margin cadence: 2024 margin accretion driven by operating leverage and lower one-time expenses; cautious to not forecast >20% organic growth segments routinely .

Estimates Context

S&P Global consensus estimates for revenue and EPS were unavailable due to a CIQ mapping error for BRP; therefore, formal beat/miss vs Wall Street consensus cannot be presented. We recommend investors treat any third-party “beat” headlines as anecdotal and not a substitute for S&P Global consensus [SpgiEstimatesError].

Key Takeaways for Investors

Organic growth remains healthy (Q4 +15%; FY +19%), but quarterly margin variability underscores sensitivity to one-time expenses and non-cash items; monitor 2024 execution on cost discipline and integration .
The Amwins divestiture simplifies the portfolio, is EPS-neutral, and should improve consolidated organic growth and margin—an incremental positive for the 2024 setup .
Q1 2024 guide implies strong start (Rev $370–$380M; Adj. EPS $0.51–$0.55), and FY 2024 targets suggest margin and FCF inflection; near-term trading catalyst hinges on credibility of margin/FCF delivery .
Segment mix matters: IAS slowed (9% organic) vs UCTS/MIS (>20%); watch for normalization of rate tailwinds and heterogeneity of segment growth in 2024 .
MGA platform shows structural momentum with new products and geographies (homeowners, flood; Canada expansion); supports medium-term thesis on scalable fee streams .
Liquidity improved into year-end (cash $116.2M; revolver capacity $259.0M); leverage commentary in Q3 (4.8x) indicates progress—continue to track net debt and interest expense trends .
Due to unavailable S&P Global estimates, focus on guidance and execution markers (margin, FCF) for positioning; any positive surprises on segment growth or cost curve can be stock catalysts [SpgiEstimatesError].

Additional references:

Q4/FY press release (full financials and non-GAAP reconciliations) .
Q3 press release (trend analysis) .
Q2 press release (trend analysis) .
Q4 call transcript (ViaVid PDF/Yahoo/InsiderMonkey excerpts) .

Disclosures: Adjusted EBITDA Margin comparability—Q4 margin computed on total revenues; Q2/Q3 margin computed on commissions and fees per releases, which may create minor comparability differences across periods .

Baldwin Insurance Group, Inc. (BRP)·Q4 2023 Earnings Summary