Slide 1: Investor Presentation Q2 2024
Investor Presentation Q2 2024 SPEAKERS: McKeel Hagerty | Chief Executive Officer and Chairman Patrick McClymont | Chief Financial Officer
Slide 2: Forward Looking Statements / Non-GAAP Financial Measures
HAGERTY Q2 2024 | 2 FORWARD LOOKING STATEMENTS / NON-GAAP FINANCIAL MEASURES This presentation contains statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements that are not h
Slide 3: Second Quarter YTD 2024 Highlights
HAGERTY Q2 2024 | 3 SECOND QUARTER YTD 2024 Highlights Total Revenue growth of 22% Commission and Fee growth of 18% Written Premium growth of 18% » Added 148,000 new customers in the first half of 2024 Membership, Marketplace and other revenue growth of 16% » Marketplace growth of 41% Significantly
Slide 4: 2024 Priorities
2024 Priorities Deliver sustained top-line momentum with continued margin expansion KEY 2024 BUSINESS PRIORITIES INCLUDE: » Further improve loyalty to drive renewals and referrals. » Enhance member experience in a cost effective and efficient way. » Build Hagerty Marketplace into the most trusted an
Slide 5: Business Process Re-engineering Driving Sustained Margin Expansion
HAGERTY Q2 2024 | 5 Business Process Re-engineering Driving Sustained Margin Expansion 1 See Appendix for additional information regarding this non-GAAP financial information. 2024 Began to implement changes to business processes to drive sustained reductions in cost to acquire and cost to serve » M
Slide 6: Second Quarter YTD 2024 Financial Highlights
HAGERTY Q2 2024 | 6 And a 840 bps improvement in operating margin $585M +22% +50M +50M +18% +39M $539M 41.1% 89% 82 $50M $80M $51M $0.06 SECOND QUARTER YTD 2024 Financial Highlights 1 See Appendix for additional information regarding this non-GAAP measure.
Slide 7: Revenue Components: Second Quarter YTD 2024 Highlights
HAGERTY Q2 2024 | 7 Q2 YTD $261 $313 $24 $158 $110 $27 $127 $129 $480 $585 $245 $50 $185 $218 $58 $309 17% 18% 14% 16% 24% 26% Growth Growth 2023 2024 2023 2024 20% growth 22% growth Strong double-digit gains TOTAL REVENUE SECOND QUARTER YTD 2024 HIGHLIGHTS Commission + fee revenue (+18%) » Written
Slide 8: Second Quarter Earnings Analysis
HAGERTY Q2 2024 | 8 $16 $34 $53 $(6) $16 $43 Q2 2022 Q2 2022Q2 2023 Q2 2023Q2 2024 Q2 2024 Delivering sustained profit growth Second Quarter Earnings Analysis SECOND QUARTER NET INCOME1 SECOND QUARTER ADJUSTED EBITDA2 1 Q2 2022 Net Income includes a $5 million loss as a result of an increase in fair
Slide 9: YTD 2024 Earnings Analysis
HAGERTY Q2 2024 | 9 $41 $80 $10$10 $1 $51 YTD Q2 2022 YTD Q2 2022YTD Q2 2023 YTD Q2 2023YTD Q2 2024 YTD Q2 2024 Delivering sustained profit growth YTD 2024 Earnings Analysis SECOND QUARTER YTD NET INCOME1 SECOND QUARTER YTD ADJUSTED EBITDA2 1 2022 Net Income includes a $26 million gain as a result o
Slide 10: Increased 2024 Outlook
HAGERTY Q2 2024 | 10 IN THOUSANDS 2023 RESULTS PRIOR 2024 OUTLOOK1 REVISED 2024 OUTLOOK Total Written Premium $907,175 $1,025,000 - $1,034,000 $1,034,000 - $1,043,000 Total Revenue $1,000,213 $1,150,000 - $1,170,000 $1,160,000 - $1,180,000 Net Income2 $28,179 $61,000 - $70,000 $76,000 - $84,000 Adju
Slide 11: Appendix
APPENDIX
Slide 12: Proven Track Record of Profitable Long-Term Growth
HAGERTY Q2 2024 | 12 To ta l L os s Pe rfo rm an ce 0% 100% 200% 300% 400% 500% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 To ta l P er ce nt ag e G ro w th 0% 100%
Slide 13: Historical Written Premium Growth
HAGERTY Q2 2024 | 13 0 100 200 300 400 500 600 700 800 900 2 0 0 4 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 9 2 0 10 2 0 11 2 0 12 2 0 13 2 0 14 2 0 15 2 0 16 2 0 17 2 0 18 2 0 19 2 0 2 0 2 0 2 1 2 0 2 2 2 0 2 3 0% 5% 10% 15% 20% 25% 2 0 0 5 2 0 0 6 2 0 0 7 2 0 0 8 2 0 0 9 2 0 10 2 0 11 2 0 12 2 0 13 2
Slide 14: Written Premium Growth Fueled by New Members
HAGERTY Q2 2024 | 14 WRITTEN PREMIUM GROWTH FUELED BY NEW MEMBERS Strong and growing New Business Count Global New Business Count 0 50,000 100,000 150,000 200,000 250,000 300,000 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 15: Post 1980 Vehicles Becoming More Impactful for Growth
HAGERTY Q2 2024 | 15 0 200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 7% annual growth in pre 1980s 18% annual growth in post 1980s ~13% ~2% Pre 1980 Vehicle Count Type Total Market (cars, mm) Collectible Vehicles b
Slide 16: Historical Seasonality Trends
HAGERTY Q2 2024 | 16 Total Revenue 5 YEAR AVERAGE Operating Income 5 YEAR AVERAGE $ IN THOUSANDS Q1 Q2 Q3 Q4 Total 2019 78,479 109,722 111,472 97,601 397,274 2020 106,859 135,462 135,781 121,446 499,548 2021 129,200 167,409 168,086 154,384 619,079 2022 167,811 206,017 216,757 197,003 787,588 2023 21
Slide 17: Revenue Components by Quarter
HAGERTY Q2 2024 | 17 REVENUE COMPONENTS BY QUARTER $ IN MILLIONS 107 112 117 127 140 147 152 158 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 86 64 75 110 103 78 89 129 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 24 21 27 24 33 20 31 27 Q3 2022 Q4 2022 Q1 2023
Slide 18: Reconciliation of Non-GAAP Metrics: Net Income to Adjusted EBITDA
HAGERTY Q2 2024 | 18 IN THOUSANDS Q2 2023 Q3 2023 - Q1 2024 Q2 2024 TTM Net income $15,539 $35,864 $42,657 $78,521 Interest and other (income) expense1 (3,770) (20,648) (12,342) (32,990) Income tax expense 3,730 14,324 5,811 20,135 Depreciation and amortization 10,397 32,229 10,014 42,243 EBITDA 25,
Slide 19: Reconciliation of Non-GAAP Metrics: Adjusted Consolidated Net Income
HAGERTY Q2 2024 | 19 IN THOUSANDS (EXCEPT PER SHARE AMOUNTS) Q2 2024 Q2 2023 YTD 2024 YTD 2023 Numerator: Net income available to Class A Common Stockholders1 $7,912 $2,388 $4,955 $305 Accretion of Series A Convertible Preferred Stock 1,839 — 3,677 — Undistributed earnings allocated to Series A Conv
Slide 20: Reconciliation of Non-GAAP Metrics | 2024 Outlook
HAGERTY Q2 2024 | 20 IN THOUSANDS 2024 Low 2024 High Net income $76,000 $84,000 Interest and other (income) expense1 (30,000) (30,000) Income tax expense 20,000 22,000 Depreciation and amortization 46,000 46,000 Change in fair value of warrant liabilities — — Share-based compensation expense 18,000
Slide 21: Never Stop Driving
Never Stop Driving HAGERTY