By James Thaler

Jan 27 - Brown & Brown’s consolidated organic growth accelerated to 13.8 percent in Q4 from 9.5 percent in the third quarter, driven by a 38.6 percent surge in national programs and a 4.4 percent pickup in retail, as its overall adjusted Ebitdac margin expanded by 190 basis points.

The Daytona Beach, Florida-based intermediary reported $0.86 in adjusted diluted net income per share, beating analysts’ $0.77 consensus estimate and advancing on the $0.69 per share the firm earned in Q4 2023.

The company’s adjusted Ebitdac margin in the quarter expanded by 190bps to 32.9 percent, while fourth quarter consolidated revenues increased by 15.4 percent from the year before to $1.18bn.

For the full year 2024, Brown & Brown reported 10.4 percent organic growth and grew total revenues by 12.9 percent to $4.81bn, while full-year 2024 adjusted Ebitdac margin expanded by 130bps to 35.2 percent.

The 38.6 percent Q4 organic growth in national programs - a segment that has been a major growth driver for the intermediary - was a notable acceleration from the 22.8 percent it registered in the third quarter.

Wholesale brokerage grew organic revenues in the fourth quarter by 7.1 percent, slightly down from the 8.4 percent it had in Q3 2024.

For national programs, Brown & Brown said that revenue growth was driven by strong organic revenue growth and increased profit-sharing contingent commissions, which were partially offset due to prior year disposition activity.

Fourth quarter total retail revenues increased by 9.5 percent to $637mn, while the same figure for national programs was up by 28.7 percent to $390mn. Wholesale brokerage total revenues were up by 11.6 percent to $144mn.

“The fourth quarter was outstanding,” the firm’s CEO J Powell Brown said in a statement.

“We are extremely pleased with our 10.4 percent organic revenue growth for 2024. These results were only possible through the incredible efforts of our 17,000+ teammates,” he added.

Fourth quarter retail adjusted Ebitdac margin expanded by 100bps to 27.8 percent from 26.8 percent, while the same figure for national programs contracted by 660bps to 47.9 percent from 41.3 percent.

The Ebitdac margin for wholesale brokerage slipped by 140bps in the fourth quarter to 25.7 percent from 27.1 percent.

Pricing commentary

In retail, the intermediary said that commercial lines rate increases moderated to 2 percent to 7 percent while rates for cat exposed property business decreased between 10 percent to 20 percent.

In wholesale brokerage, the rate environment remained relatively similar to Q3 2024, except for property cat business, where pricing decreased 10 to 20 percent. Professional lines rates were down 5 to 10 percent and casualty lines rates were up 5 to 10 percent.

Commenting on market conditions, the firm said that it anticipates rates in the admitted market in the first half of 2025 to be similar to Q4 2024 and that cat property rates will decrease similar to last year’s fourth quarter, though the intermediary is monitoring the potential impact of the California wildfires.

The intermediary completed 10 acquisitions amounting to $137mn in annualized revenues in the fourth quarter, and completed 32 acquisitions in 2024 worth $174mn in annualized revenues.

That compares with the 33 acquisitions worth $162mn in annualized revenue it completed in 2023.