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Total Revenue: $109.4 million, reflecting a 6% increase from 2023.
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Adjusted EBITDA: $10.6 million, which is a 17% rise compared to 2023.
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Warranty Revenue: $68.9 million, a modest increase of 1% from 2023.
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Warranty Adjusted EBITDA: $7.6 million, down from $8.4 million in 2023.
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KSX Revenue: $40.5 million, marking a 16% increase from $35 million in 2023.
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KSX Adjusted EBITDA: $6.6 million, up 15% from $5.7 million in 2023.
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Cash Position: $5.5 million as of December 31, 2024, down from $9.1 million at the end of 2023.
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Total Debt: $57.5 million, up from $44.4 million at the end of 2023.
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Net Operating Losses (NOLs): Approximately $622 million as of December 31, 2024.
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Securities Repurchased: 355,750 shares for $2.8 million, inclusive of fees and commissions.
Announcement Date: March 18, 2025
For a full transcript of the earnings call, please refer to the comprehensive earnings call transcript.
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Kingsway Financial Services Inc (NYSE:KFS) reported a 6% growth in consolidated revenue for 2024, totaling $109.4 million.
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The consolidated adjusted EBITDA increased by 17% from 2023, signifying enhanced profitability.
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Revenue in the KSX segment grew by 16%, fueled by strategic acquisitions and robust performance.
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Kingsway completed the acquisition of Image Solutions and divested its VA Lafayette subsidiary, aligning with strategic objectives.
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The company maintains a strong acquisition pipeline and intends to expand its KSX operations through 2 to 3 deals annually.
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The Extended Warranty sector saw a decrease in adjusted EBITDA due to heightened claim costs stemming from inflation in parts and labor.
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Ravix, a subsidiary, faced a slight decrease in EBITDA despite improvements in gross margin.
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C-suite EBITDA declined due to reduced sales from diminished deal volume in the capital markets.
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The company encountered challenges in talent acquisition, with some new hires not fulfilling expectations.
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Kingsway accomplished only one acquisition in 2024, falling short of its goal for two to three acquisitions annually.
Q: Can you elaborate on the moderation of claims expenses you noted in the Extended Warranty segment for the latter half of 2024? A: John Fitzgerald, CEO, explained that claims rose by 6.6% for the entire year of 2024, a reduction from a 10% rise in 2023. The moderation was particularly pronounced from Q2 to Q4, with claims increasing by just over 4%, indicating reductions in both frequency and severity.
Q: Regarding the establishment of your new skilled trade services platform, what is your vision for the growth of this sector within KSX? A: John Fitzgerald, CEO, emphasized the significant opportunity within plumbing service and repair, initially focusing on organic growth through market penetration and service enhancement. The strategy involves potential service line expansion into HVAC and leveraging the fragmented industry for inorganic growth via acquisitions.
