Goosehead Insurance, Inc. has reported a net income of $3 million for the third quarter of 2022, a 43% decrease compared to $5.3 million from the same period last year.
The company noted that the decrease was due to higher non-cash stock compensation expense and lower income tax benefit.
Moreover, the company’s total revenues for Q3 grew organically 38% over the prior year quarter to $57.7 million.
Additionally, Goosehead’s total operating expenses, excluding equity-based compensation, depreciation and amortization, for the third quarter of 2022 was $46.7 million, a 33% from $35.1 million in the prior-year period.
The increase from the prior period was due to larger employee compensation and benefits expenses related to investments in franchise recruiters, service agents, and information systems.
Furthermore, the company’s total written premiums placed for 2022 are expected to be between $2.176 billion and $2.215 billion, representing organic growth of 40% on the low end of the range to 42% on the high end of the range.
At the same time, Goosehead noted that total revenues for 2022 are expected to be between $194 million and $205 million, representing organic growth of 28% on the low end of the range to 35% on the high end of the range
Mark E. Jones, Chairman and CEO, commented: “We delivered excellent growth in revenue and earnings for the third quarter, further validating the strength and consistency of our platform in an increasingly challenging macro-economic environment.
“In the third quarter premiums grew 42% with some increasing benefit from auto and home rates that could continue through this year and into 2023 given industry loss trends. Total revenues increased 38%, core revenues grew 39% and Adjusted EBITDA increased 67% with EBITDA margin up over 320 basis points. We are already beginning to see the emerging benefits from optimizing our resources to emphasize growth of our Franchise distribution and drive improvement in productivity of Corporate distribution.
“Franchise launches were up 57% in the quarter while the quality of our Franchises and pipeline continues to improve. We are ramping up our efforts to help an increasing number of franchises scale operations through producer additions and we are creating more opportunity for our highest quality corporate agents to become franchisees.
“We expect these efforts to result in continued strong growth of our approximately 2,500 total sales agents across both Corporate and Franchise distribution as we continue our march towards industry leadership in US Personal Lines.”
