Kingsway Corporation · NYSE:KWY
Kingsway — Kingsway Financial Services — Investor Day (May 2025)
52 slides from Kingsway's investor day presentation, May 19, 2025
Slide 1: Investor Day
NYSE: KFS Investor Day May 19, 2025 Building through Search
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are not historical facts and involve risks and uncertainties that could cause actual results
Slide 3: Agenda
Introduction to Kingsway Agenda Business Update Kingsway Business System Skilled Trades Case Study Q&A Building through Search Fireside Chat
Slide 4: About Us
About Us Kingsway Financial Services Inc. (“Kingsway”) (NYSE: KFS) is the only publicly-traded US company employing the Search Fund model to acquire and build great businesses. Kingsway owns and operates a collection of high-quality B2B and B2C services companies that are asset-light, growing, profi
Slide 5: Introduction to Kingsway
AL Introduction to Kingsway
Slide 6: Search Has Compelling Long-Term Returns
Search Has Compelling Long-Term Returns The Search Fund model – or “Entrepreneurship Through Acquisition” (ETA) – has an attractive historical track record. “ Since 1996 the Center for Entrepreneurial Studies at Stanford Graduate School of Business (GSB) has conducted a biennial study of core search
Slide 7: Search Serves A Clear Market Purpose
Search Serves A Clear Market Purpose Search provides an exit to small business owners looking to retire, but who don’t have a logical succession plan. Looking to Retire Post-MBA No Succession Plan or Heir Talented and Motivated Seller Requires Monetization Event Provides a Financial Exit Buyer No PE
Slide 8: Why Search Outperforms
Why Search Outperforms An energetic, talented, and incentivized operator often finds numerous paths to improve a “lifestyle” business. “Lifestyle” Business Motivated Operator Building through Search Founder-Led Sales Professional Sales Team Kingsway employs the traditional Search Fund model to acqui
Slide 9: The “Silver Tsunami” Of Business Owner Retirements Has Arrived
The “Silver Tsunami” Of Business Owner Retirements Has Arrived The next two decades will see record numbers of Baby Boomer business owners looking for an exit. Nearly $4.8 trillion of net More than 2 million small Lower middle market Search Funds can help fill worth, representing the businesses are
Slide 10: Search Is Difficult To Access
Search Is Difficult To Access Kingsway offers a unique vehicle to participate in the Search Fund asset class via an NYSE-listed company. Private Fund of Funds or DIY Search Fund Investing Search Accelerators Building through Search Most Search Fund investing is An alternative approach is to As a pub
Slide 11: Kingsway’s Advantages
Kingsway’s Advantages Kingsway is well-positioned for success with permanent capital and years of investment in its Search infrastructure. Strong Track Infrastructure Disciplined Record and Support Investment Criteria Top Quality World-Class Public Company Searcher Talent Advisory Board Reputation P
Slide 12: Top Quality Searcher Talent
Top Quality Searcher Talent In 2024, Kingsway had over 100 applicants for two open OIR positions. Davide Zanchi Timi Okah Peter Dausman Image Solutions Ravix, CSuite Digital Diagnostics Charles Mokuolu Rob Casper Drew Richard Secure Nursing Services Bud’s Plumbing Systems Products Int’l Portfolio Ch
Slide 13: Disciplined Investment Criteria
Disciplined Investment Criteria Kingsway seeks to acquire high-quality B2B and B2C services businesses with consistent characteristics. High percentage Capital light & Operating in a of recurring non-cyclical fragmented revenue business industry B2B or B2C Long history of Low customer Growth busines
Slide 14: A World-Class Advisory Board
A World-Class Advisory Board Kingsway’s Operators-In-Residence and Business CEO’s have access to an exceptional team of advisors. BOARD PROFILES Thomas Joyce Will Thorndike Tyler Gordy Mr. Tom Joyce served as CEO of Mr. Will Thorndike is widely known as Mr. Tyler Gordy is a Partner at Artesian, a Da
Slide 15: A Tax-Advantaged Corporate Structure
A Tax-Advantaged Corporate Structure Kingsway has $622m of valuable NOL tax assets. Kingsway’s tax assets stem from a legacy business exited many years ago. $385m Kingsway’s NOL’s relate to a truck insurance business that suffered during the 2008 financial crisis. $92m Kingsway began its pivot to th
Slide 16: Kingsway’s Strategy: A Self-Funding Flywheel
Kingsway’s Strategy: A Self-Funding Flywheel Cash flows from Kingsway’s portfolio of asset-light businesses can fund further acquisitions and growth. Invest To Grow Acquire Great Businesses 2 1 Typical Organic Growth Path Post-Transaction Investment period to position the business for growth Kingswa
Slide 17: A Promising Track Record
A Promising Track Record Kingsway’s experience with Search provides confidence the model is working. PWSC Kingsway’s proof-of-concept with the Search Fund model was the acquisition of a new home warranty business called PWSC. PWSC was acquired for $10m, funded 50% with preferred equity. Tyler Gordy,
Slide 18: Financial And Business Targets
Financial And Business Targets Kingsway seeks to grow EBITDA via acquisition as well as organically. UNDER REVIEW TO UPGRADE 2-3 >30% ACQUISITIONS PER YEAR ACQUISITION IRR HURDLE Kingsway’s 12-month run-rate adjusted EBITDA for its operating companies is $18.0-$19.0 million Building through Search N
Slide 19: Kingsway Owns High-Quality B2B and B2C Services Businesses
Kingsway Owns High-Quality B2B and B2C Services Businesses Public peers generally trade for EBITDA multiples well into the double-digits. B2B Services B2B Services B2B Services Healthcare Services Healthcare Services Vertical Market SaaS Skilled Trades Building through Search NYSE:KFS 19
Slide 20: Kingsway’s Acquisitions Have Been Done At Attractive Multiples
Kingsway’s Acquisitions Have Been Done At Attractive Multiples Business purchases are consistently within the target valuation range. Acquired 2021 2022 2022 2023 2023 2024 2025 Deal Price $11.0M $8.5M $10.9M $2.8M $11.0M $19.5M $5.0M Adj. EBITDA (i) $1.9M $1.8M $2.7M Not Disclosed $1.8M $3.1M $0.8M
Slide 21: Case Study: SPI
Case Study: SPI SPI was purchased for 1.3x ARR – and today is a Rule-of-40 SaaS business. CEO PROFILE Mission-Critical Timeshare Software Opportunity to Accelerate Growth In 2024, SPI Reached Rule-of-40 Drew Richard Drew joined Kingsway in the summer of 2022. Prior to joining Kingsway, he worked in
Slide 22: Conclusion
Conclusion Kingsway is the only publicly-traded US company employing the Search Fund model to acquire and build great businesses. Strong Track Infrastructure Disciplined Record and Support Investment Criteria Portfolio of High- Quality Services Companies Top Quality World-Class Public Company Search
Slide 23: Business Update
2 Business Update
Slide 24: M&A Since 2024 Investor Day
M&A Since 2024 Investor Day Kingsway has made three KSX acquisitions and finished divesting its portfolio of real estate assets. Acquisitions Divestitures Image Solutions Bud’s Plumbing ViewPoint September 2024 March 2025 April 2025 Founded in 2003, Image Bud's Plumbing is a 100-plus ViewPoint advan
Slide 25: KSX Performance
KSX Performance KSX made solid progress in Q1 2025 and is showing healthy momentum. Quarterly Revenue Quarterly Adj. EBITDA Performance Commentary $11.7M $1.9M KSX revenue grew +23.3% yoy in Q1 2025 $9.5M $1.6M KSX adjusted EBITDA grew +23.2% yoy in Q1 2025 Bud’s Plumbing acquisition in March
Slide 26: Extended Warranty Performance
Extended Warranty Performance After two challenging years, Extended Warranty appears to be entering a more favorable phase of recovery. Quarterly Revenue Quarterly Adj. EBITDA Performance Commentary $16.7M $16.7M $1.4M EW revenue flat yoy at $16.7m in Q1 2025 EW adjusted EBITDA down yoy from $1.
Slide 27: Building A Foundation To Scale
Building A Foundation To Scale By centralizing key functions like HR benefits and accounting, Kingsway can better support future growth. Clear Progress Centralizing Accounting Completed In Progress May 2024 Jun 2024 Aug 2024 Building through Search NYSE:KFS 27
Slide 28: Kingsway Business System
3 Kingsway Business System
Slide 29: Improving The Probability Of Success
Improving The Probability Of Success Kingsway seeks to “bend the curve” towards better KSX outcomes by proactively addressing potential points of failure. Pre-Deal Factors Post-Deal Factors Customer Poor Industry Highly Levered Concentration Growth Balance Sheet Just as we have a playbook for sourci
Slide 30: The Kingsway Business System (KBS)
The Kingsway Business System (KBS) KBS is a comprehensive, integrated approach to continuous improvement inspired by best practices at firms like Danaher. Talent Hiring and promoting the best people available at every salary level is what distinguishes premier companies from mediocre firms. Plan Cre
Slide 31: Talent
Talent KBS provides a set of tools to help our CEOs strengthen and scale their teams. 1 2 3 Evaluate Recruit Develop Talent Assessment to evaluate an TopGrading Methodology: a Talent Development and inherited team’s fit, performance, proven system to hire A-players Management (PMP) to implemen
Slide 32: Plan Do Check
Plan CEOs set a vision, create a plan, and execute – but continuous feedback for improvement is key. A Vision Plan Plan B Annual & Long-Term Strategic Plans C Improvement Priorities Do Continuous Do D Action Plan Improvement Framework Check E Monthly Review Act Review F Annual Review Building throug
Slide 33: Enterprise Excellence
Enterprise Excellence KBS helps our CEOs implement repeatable, teachable processes so their small businesses can scale and deliver consistently. KBS Best Practices Voice of Continuous Customer (VOC) Improvement Operational Customer Scalable Value Stream Structured Excellence Satisfaction Growth Mapp
Slide 34: Growth
Growth KBS helps our CEOs align strategy with impact by understanding the key components of value creation. Growth Levers & Frameworks These frameworks are Customer Pricing Customer Market Retention Optimization Expansion Expansion continually updated to reflect both best practices and newly establi
Slide 35: From Theory To Action
From Theory To Action KBS provides practical training, resources, and tools that our CEOs use to drive real-world results. Centralized Leadership Training KSX Community Knowledge Hub Establishing Priorities Proprietary to Kingsway Peer Feedback Building Culture Tools, Case Studies, etc.
Slide 36: Case Study: Kingsway Skilled Trades
Case Study: Kingsway Skilled Trades
Slide 37: Operator Bio
Operator Bio Rob Casper has over a decade of operational leadership at PE-backed portfolio companies. HVAC Plumbing Multi-Site Led two companies Led three companies Led over twenty-five operating across 30 states operating across 5 states as independent sites as Regional President with Plumbing Pres
Slide 38: Bud’s Plumbing Transaction
Bud’s Plumbing Transaction Acquired following a 5-month search process. Bud’s Plumbing is the leading service provider in its MSA Transaction Details Kingsway Estimated Market Share (%) Transaction Date March 14, 2025 2x A Purchase Price $5.0m B Bud’s Plumbing enjoys a market share Deal Multiple 6.0
Slide 39: Kingsway Business System in Practice
Kingsway Business System in Practice Real-world examples of how the KBS was applied to Bud’s Plumbing. Talent Plan Enterprise Excellence Growth Building through Search NYSE:KFS 39
Slide 40: Talent
Talent Changes to the organizational structure unlocked immediate benefits, with further opportunity from specialization. Rob Casper Mark Corn KST Recruiter KST President President Removing Bottlenecks Plumber work orders per day were lower than our internal benchmarks, but resolvable with two actio
Slide 41: Plan
Plan Crafted a plan to drive performance with continuous feedback to track progress. 80/20 Benchmarking KPI’s Training Used the Pareto Benchmarked performance Created a performance Invested in people via Principle to prioritize across the organization. measurement feedback training to improve execut
Slide 42: Enterprise Excellence
Enterprise Excellence KBS best practices helped identify opportunities for process improvement. Demand Generation Marketing Spend Unprofitable Service Calls Improved Margins Cost Savings Supplier Relationships Plumbers Per Truck More Efficient Operations Building through Search NYSE:KFS 42
Slide 43: Growth
Growth Two key levers for value creation are (1) Market Expansion and (2) Geographic Expansion. Market Expansion Geographic Expansion IL IN WORK ORDER ESCALATION KY Cabling Plumbing Jetting Pumping Repair MO TN 30 Become a one Move up the value Increase “up-sell” with Growth opportunity by exp
Slide 44: A Repeatable Strategy
A Repeatable Strategy There are many “Bud’s” across the US that can be attractive to the KSX Skilled Trades Platform. Skilled Trades Platform $120B 3 Total Addressable Deals per Market Year Building through Search NYSE:KFS 44
Slide 45: Q&A
Q&A
Slide 46: Fireside Chat
© Fireside Chat
Slide 47: Appendix
Appendix
Slide 48: Kingsway’s Operating Structure
Kingsway’s Operating Structure Following the “Outsiders” playbook, Kingsway employs a decentralized model with highly incentivized operators. Kingsway Financial Services, Inc. Holding Company LEADERSHIP TEAM OPERATORS IN RESIDENCE OPERATING COMPANIES JT Fitzgerald President, CEO, and Director Kent H
Slide 49: Reconciliation of GAAP Operating Income for KSX Segment
Reconciliation of GAAP Operating Income for KSX Segment (in thousands) Q1 2025 Q1 2024 GAAP Operating Income for KSX segment $1,743 $1,343 Non-GAAP Adjustments: Acquisition and employee costs (1) 52 138 Investment Income (2) 25 10 Depreciation 97 64 Total Non-GAAP Adjustments 174 212 Non-GAAP adjust
Slide 50: Reconciliation of GAAP Operating Income for EW Segment
Reconciliation of GAAP Operating Income for EW Segment (in thousands) Q1 2025 Q1 2024 GAAP Operating Income for Extended $515 $1,076 Warranty segment Non-GAAP Adjustments: Investment income (1) 247 320 Employee costs 50 - Depreciation 38 52 Total Non-GAAP Adjustments 335 372 Non-GAAP adjusted EBITDA
Slide 51: 12-Month Run-Rate Adjusted EBITDA Definition
12-Month Run-Rate Adjusted EBITDA Definition This metric is not intended to be guidance by management regarding the future earnings of the Company; rather, it is intended to capture the twelve-month earnings of what the Company currently owns or has recently acquired; as such, it includes: The a
Slide 52: Building through Search
Building through Search Kent Hansen James Carbonara kingsway-financial.com Chief Financial Officer Partner, Hayden IR (312) 766-2163 (646) 755-7412 khansen@kingsway-financial.com james@haydenir.com
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