Ryan Specialty Holdings, Inc. Class A

Greetings and welcome to the Ryan Specialty Second Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Noah Angeletti, Head of Investor Relations and Treasurer. Please go ahead.

Good afternoon, and thank you for joining us today for Ryan Specialty Holdings' second quarter 2022 earnings conference call. In addition to this call, we filed a press release with the SEC earlier this afternoon, which has been posted to our website at ryansg.com. On today's call, management's prepared remarks and answers to your questions may contain forward-looking statements. Investors should not place undue reliance on any forward-looking statement. These statements are based on management's current expectations and beliefs and are subject to risks and uncertainties that could cause actual results to differ materially from those discussed today. We encourage listeners to review the more detailed discussion of these risk factors contained in the company's filings with the SEC. We assume no duty to update such forward-looking statements in the future, except as required by law. Additionally, certain non-GAAP financial measures will be discussed on this call and should not be considered in isolation or as a substitute for the financial information presented in accordance with GAAP. Reconciliations of these non-GAAP financial measures to the most closely comparable measures prepared in accordance with GAAP are included in our earnings release, which is filed with the SEC and available on the company's website. With that, I'd now like to turn the call over to the founder, chairman, and chief executive officer of Ryan Specialty, Pat Ryan.

Good afternoon, and thank you for joining us to discuss our second quarter results. Before diving into the quarter, I want to acknowledge the team's efforts since we went public one year ago. I am pleased with our strong results, and we continue to have a long runway ahead of us. We remain true to our values, are well-positioned to sustainably and profitably grow our business, and believe that we will continue delivering long-term value for our shareholders. I am also incredibly proud of our front lines. The producers, the underwriters, and their teams are out competing and winning head-to-head in the field by innovating with new products and solutions, unrelenting in the pursuit of excellence, and winning a substantial amount of new business. Our performance in the second quarter again demonstrated the strength of our business. Continuing the track record of success we've established over the past 11 years, We grew total revenue 26%, led by outstanding organic revenue growth of 22%. We also achieved another quarter of double-digit growth in adjusted EBITDA and adjusted net income on a year-over-year basis. Our three specialties all performed very well, each generating strong double-digit growth for the quarter. Overall, I'm immensely pleased with our differentiated platform, which continues to prove that it's truly best in class, providing our clients and trading partners with the value and service they deserve. Throughout the second quarter, the E&S marketplace remained robust. In fact, the overall flow of business into our E&S lines is still at historically high levels. As we previously noted, We've invested significantly in those lines, where we see clear opportunities to grow, in addition to bolstering the lines of business where we have a leadership position. Through Q2, we remain in the prolonged stages of the historically hard market. Broadly speaking, rates remain firm in nearly all of our lines of business. While rates moderated in certain lines, we saw continued upward rate movement in other lines. In addition, the standard or admitted carrier competition we observed on the periphery in which we flagged our prior earnings goals has yet to meaningfully impact rate or flow in the aggregate. We continue to invest in our intellectual capital throughout the quarter, adding to our already strong team and deep bench, and again proving out that we are a destination of choice for the best talent in the industry. Here are a few of the many examples. We've added accomplished teammates within our renewable energy line and to our data and analytics and technology teams. We are also making significant valuable additions in many of our lines of business, expanding new industry verticals. An exceptional talent we've assembled since our founding, including recent additions over the last year, has been hard at work developing new programs and introducing new products in our MGAs and MGUs, bringing new and existing capital in addition to arranging alternative capital to support our clients. We're also pleased to note the productivity among our brokers continues to improve and accelerate and is reflected in our strong Q2 earnings performance. This September will mark the two-year anniversary of our acquisition of AllRisks, which has exceeded our expectations in all facets. AllRisks is further proof that our business model provides a powerful platform for those looking to join Ryan specially and validates our M&A thesis that we make strong businesses even better. As we look ahead to the rest of 2022, We are mindful of the elevated uncertainty in the global economy and in the geopolitical environment. That said, we believe we will remain well-positioned and expect favorable specialty insurance market dynamics to persist. We also continue to invest in our various strategies to take advantage of the resilient and increasing flow into the E&S market and further expand our market share. By building what we believe to be the most differentiated platform and deepest bench in the industry, we have benefited from a flight to quality and believe we have positioned ourselves to outperform our competition through the cycle. Moreover, we maintain a highly active M&A pipeline as we look for additional opportunities, both tuck-ins and large acquisitions, to enhance and differentiate our platform and capabilities. We are working from a position of strength, given our strong balance sheet and ample capacity, which enables us to act when we find the right opportunities. As I've said before, we remain disciplined in our pursuit of acquisitions. Any deal we consider must meet our criteria, a strong cultural fit, strategic and accretive to our returns. Our M&A strategy is and will remain supplemental to our organic growth story. We are not a roll-up, and we do not require acquisitions to achieve our growth targets. In summary, it was another team effort at Ryan Specialty that contributed to a fantastic second quarter and first half of 2022. With that, I'll now turn the call over to our president, Tim Turner. Tim?