Pot producer Canopy Growth terminates CFO Judy Hong
The termination of Hong, who was appointed CFO in 2022, was not related to its operating results or due to any disagreements or concerns over its financial or reporting practices, Canopy said.
The company, once an industry leader, had raised doubts about its ability to continue as a going concern in 2023 as it struggled to turn profitable.
Canopy appointed as interim CFO Tom Stewart, who was its chief accounting officer from April 2019 to August 2023. The company has also begun a search for a permanent CFO.
The U.S.-listed shares of the company were up 1.8% in morning trading after the announcement.
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Compared to the second quarter of 2024, and aligned with our strategic objectives, we grew third party processing volumes and revenue by over 120% and continued to optimize our business, including by keeping certain dry gas producing areas shut-in because they are uneconomic at current natural gas prices. Our continuing focus on lowering our debt resulted in net debt reduction of $18.6 million, to $166.9 million. As we head towards the end of 2025 our team remains focused on debt reduction, continuous improvement to our cost structure, filling our gas processing facilities, preparing for the expiration of a long-term fixed price sulphur marketing agreement on December 31, 2025, and evaluating opportunities for growth.' Q2 2025 HIGHLIGHTS Generated NOI of $26.5 million ($0.09 per basic and fully diluted share) and Funds Flow from Operations1 of $14.5 million ($0.05 per basic and fully diluted share). Reduced Net Debt1 by $18.6 million from Q1 2025 to $166.9 million. Reduced operating expenses by $12.6 million (24%) compared to Q2 2024 to $40.4 million, reflecting both the shut-in of uneconomic production and the continued reduction of operating cost structure. Increased third-party processing volumes by 66.0 MMcf/d (123%) compared to Q2 2024 to 119.8 MMcf/d. This yielded higher third-party processing and marketing revenue of $9.6 million, an increase of $5.4 million (129%) to compared to Q2 2024. Produced 26,064 boe/d (81% natural gas), down 16% from Q2 2024 mainly due to the voluntary shut-in of approximately 9,000 boe/d of uneconomic dry gas production from Q3 2024 through Q2 2025. Completed corporate rebranding to Cavvy Energy Ltd. on May 12, 2025, capping our strategic pivot to affirm our identity as a western Canadian based energy company. ____________________1 Refer to the 'non-GAAP measures' section of the Company's MD& Quarterly Figures 2025 2024 2023 ($ 000s unless otherwise noted) Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Production Natural gas (mcf/d) 126,198 105,338 111,787 115,196 157,077 175,356 174,211 155,763 Condensate (bbl/d) 2,507 2,454 2,149 2,191 2,472 2,781 2,384 2,020 NGLs (bbl/d) 2,524 2,574 1,788 1,726 2,210 2,613 1,921 2,273 Sulphur (tonne/d) 1,128 1,076 968 1,444 1,376 1,491 1,284 1,124 Total production (boe/d)(1) 26,064 22,584 22,568 23,116 30,861 34,620 33,340 30,253 Third-party volumes processed (mcf/d)(2) 119,761 81,777 71,497 66,518 53,763 58,423 67,350 57,363 Financial Natural gas price ($/mcf) Realized before Risk Management Contracts(3) 1.73 2.24 1.55 0.77 1.14 2.53 2.32 2.65 Realized after Risk Management Contracts(3) 3.23 3.58 3.36 3.43 2.71 3.21 3.12 3.25 Benchmark natural gas price 1.72 2.14 1.46 0.68 1.17 2.48 2.29 2.59 Condensate price ($/bbl) Realized before Risk Management Contracts(3) 84.60 95.15 94.87 92.13 99.96 91.18 97.15 97.47 Realized after Risk Management Contracts(3) 85.88 88.29 90.61 84.61 87.75 84.49 86.34 80.49 Benchmark condensate price ($/bbl) 87.71 100.24 98.85 97.10 105.62 98.43 104.30 106.30 Sulphur price ($/tonne) Realized sulphur price(4) 32.40 17.00 12.09 8.86 18.43 14.49 22.54 13.34 Benchmark sulphur price 373.11 246.36 180.54 128.47 103.19 94.84 118.29 107.09 Net income (loss) 4,147 2,666 (20,921 ) 7,496 (19,196 ) (6,284 ) 7,414 (16,254 ) Net income (loss) $ per share, basic 0.01 0.01 (0.08 ) 0.04 (0.12 ) (0.04 ) 0.06 (0.10 ) Net income (loss) $ per share, diluted 0.01 0.01 (0.08 ) 0.04 (0.12 ) (0.04 ) 0.04 (0.10 ) Net operating income(5) 26,491 32,550 13,720 19,818 7,652 23,418 25,441 11,650 Cashflow provided by (used in) operating activities 1,599 22,612 (592 ) 2,260 (1,555 ) 7,049 31,983 7,577 Funds flow from operations(5) 14,502 21,707 2,824 8,234 (4,874 ) 12,044 14,269 (1,422 ) Total assets 553,216 571,470 612,423 615,040 585,940 590,531 638,541 564,921 Adjusted working capital deficit(5) (20,144 ) (30,540 ) (29,777 ) (42,658 ) (37,986 ) (31,671 ) (31,830 ) (21,454 ) Net debt(5) (166,878 ) (185,438 ) (197,564 ) (206,779 ) (219,204 ) (209,964 ) (204,046 ) (205,536 ) Capital expenditures(6) 2,391 6,538 5,800 10,002 5,003 4,897 9,306 16,363 (1) Total production excludes sulphur. (2) Third-party volumes processed are raw natural gas volumes reported by activity month, which do not include accounting accruals.(3) Includes physical commodity and financial risk management contracts inclusive of cash flow hedges, (together 'Risk Management Contracts'). The realized natural gas price after Risk Management Contracts shown above is normalized to exclude the impact of the hedge monetization. (4) Realized sulphur price is net of deductions such as transportation, marketing and storage fees.(5) Refer to the 'Net Operating Income', 'Capital Resources', 'Funds Flow from Operations' and 'Working Capital and Capital Strategy' sections of the Company's MD&A for reference to non-GAAP measures.(6) Excludes reclamation and abandonment activities. OUTLOOK Management's near-term priority remains strengthening our balance sheet while safely and responsibly operating our assets. Delivering on this priority requires continued focus on attracting incremental third-party volumes, implementing cost reduction initiatives, optimizing infrastructure, and executing non-core asset dispositions to maintain profitability during all periods of the commodity cycle. Our long-term strategy requires continuous improvement in the business while identifying opportunities to generate growth for our shareholders. While guidance remains unchanged at this time, management expects 2025 NOI at or above the high end of the guidance range. 2025 guidance remains unchanged as follows: 2025 Guidance ($ 000s unless otherwise noted) Low High Total production (boe/d)(1) 23,000 25,000 Net operating income(2)(3)(4) 75,000 95,000 Operating netback ($/boe)(2)(3)(4) 9.00 11.00 Capital expenditures 25,000 30,000 (1) 2025 production guidance assumes persistence of previously announced shut-ins in Central AB and periodic production of previously announced shut-ins in Northern AB and Northeast BC through 2025.(2) Refer to the 'Net Operating Income' and 'Operating Netback' sections of the Company's MD&A for reference to non-GAAP measures.(3) Assumes unhedged average 2025 AECO price of $1.85/GJ and average 2025 WTI price of US$ 66.92/bbl.(4) Includes the impact of hedge contracts in place at August 12, 2025. Specific priorities for 2025 are: Sustain a safe and regulatory compliant business Minimize facility outages to maximize sales and processing revenue Capture opportunities to grow our third-party gathering and processing business Meaningfully reduce operating expenses to improve corporate netback Deliver attractive ROI on value adding optimization projects included in the 2025 capital program Reduce long term debt to improve financial flexibility Our ongoing priority to grow third-party gathering and processing revenues at our operated facilities has yielded growth in processed volumes at the Caroline Gas Plant over the last four quarters, reflecting strong demand and increased utilization. As a result, third-party processing revenues are forecasted to exceed management's expectations for the year. The legacy fixed price sulphur contract, entered into in 2019, expires on December 31, 2025. Under this contract, the Company receives a fixed price of approximately $6/tonne for the majority of its sulphur production capability of approximately 1,400 tonnes per day. On January 1, 2026, the Company will receive market price for all sulphur production, less normal deductions for transportation, handling, and marketing. The expiration of this contract represents a significant potential revenue opportunity beginning in 2026. As of August 12, 2025, the spot west coast sulphur price was US$252.50/tonne, prior to processing, transportation and marketing costs. Due to the current outlook for North American natural gas prices, Cavvy is not planning to resume drilling operations in 2025, although may participate in a low working interest, non-operated, liquids rich gas drilling prospect in Central AB. The Company will only develop its portfolio of high impact conventional Foothills drilling opportunities once natural gas prices sustainably recover and the Company has achieved its deleveraging target. HEDGE POSITION Cavvy hedges to mitigate commodity price, interest rate and foreign exchange volatility to protect the cash flow required to fund the Company's operations, capital requirements and debt service obligations, while maintaining exposure to commodity price upside. Cavvy continues to execute its risk management program governed by its hedge policy and in compliance with the thresholds required by senior lenders. The Company has 110,000 GJ/d of its 2025 natural gas production hedged at a weighted average fixed price of $3.32/GJ, and 1,679 bbl/d of its 2025 condensate production hedged with a weighted average floor price of CAD$84.42/bbl and a weighted average ceiling price of CAD$92.32/bbl. The Company's aggregate hedge position for 2025 totals 19,055 boe/d, or approximately 80% of the production guidance range. As of June 30, 2025, the Company is hedged in accordance with the requirements of its senior loan agreements. The discounted unrealized gain on the Company's hedge portfolio at August 12, 2025 was approximately $52.5 million using the forward strip on August 11, 2025. The tables below summarize the hedge portfolio as of August 12, 2025: 2025-2026 Hedge Portfolio(1) Q125 Q225 Q325 Q425 2025 Q126 Q226 Q326 Q426 2026 AECO Natural Gas Sales Total Hedged (GJ/d) 110,000 110,000 110,000 110,000 110,000 78,500 71,854 68,340 65,025 70,886 Avg Hedge Price (C$/GJ) $3.32 $3.32 $3.32 $3.32 $3.32 $3.32 $3.34 $3.40 $3.41 $3.36 WTI / C5+Sales Total Hedged (bbl/d) 1,721 1,692 1,663 1,641 1,679 1,622 1,529 1,364 1,350 1,465 Avg Collar Cap Price (C$/bbl) $92.73 $92.45 $92.03 $92.05 $92.32 $91.69 $90.94 $91.67 $91.68 $91.48 Avg Collar Floor Price (C$/bbl) $84.14 $84.25 $84.61 $84.67 $84.42 $84.09 $83.83 $85.64 $85.70 $84.82 Power Purchases Total Hedged (MW) 53 54 54 54 54 45 45 45 45 45 Avg Hedge Price (C$/MWh) $79.19 $79.10 $79.07 $79.08 $79.11 $75.87 $75.88 $75.88 $75.88 $75.882027-2028 Hedge Portfolio (1) Q127 Q227 Q327 Q427 2027 Q128 Q228 Q328 Q428 2028 AECO Natural Gas Sales Total Hedged (GJ/d) 63,340 28,154 - - 22,637 - - - - - Avg Hedge Price (C$/GJ) $3.41 $3.40 - - $3.41 - - - - - WTI / C5+ Sales Total Hedged (bbl/d) 1,171 1,151 1,125 1,125 1,143 785 750 - - 382 Avg Collar Cap Price (C$/bbl) $91.40 $88.80 $90.05 $90.05 $90.08 $90.40 $86.50 - - $88.50 Avg Collar Floor Price (C$/bbl) $84.37 $84.08 $90.05 $90.05 $87.14 $90.40 $86.50 - - $88.50 Power Purchases Total Hedged (MW) 25 25 25 25 25 - - - - - Avg Hedge Price (C$/MWh) $70.19 $70.19 $70.19 $70.19 $70.19 - - - - - (1) Includes forward physical sales contracts and financial derivative contracts as of August 12, 2025 CONFERENCE CALL DETAILS A conference call and webcast to discuss the results will be held on Wednesday, August 13, 2025, at 8:30 a.m. MDT / 10:30 a.m. EDT. To participate in the webcast or conference call, you are asked to register using one of the links provided below. To register to participate via webcast please follow this link: Alternatively, to register to participate by telephone please follow this link: A replay of the webcast will be available two hours after the conclusion of the event and may be accessed using the webcast link above. ABOUT CAVVY ENERGY Cavvy Energy is a Canadian energy company headquartered in Calgary, Alberta. The Company is a significant upstream producer and midstream custom processor of natural gas, NGLs, condensate, and sulphur from Western Canada. Cavvy's vision is to provide responsible, affordable natural gas and derived products to meet society's energy security needs. For further information, visit or please contact: Darcy Reding, President & Chief Executive Officer Telephone: (403) 261-5900 Adam Gray, Chief Financial OfficerTelephone: (403) 261-5900 Investor Relationsinvestors@ Forward-Looking StatementsCertain of the statements contained herein including, without limitation, management plans and assessments of future plans and operations, Cavvy's outlook, strategy and vision, intentions with respect to future acquisitions, dispositions and other opportunities, including exploration and development activities, Cavvy's ability to market its assets, plans and timing for development of undeveloped and probable resources, Cavvy's goals with respect to the environment, relations with Indigenous people and promoting equity, diversity and inclusion, estimated abandonment and reclamation costs, plans regarding hedging, plans regarding the payment of dividends, wells to be drilled, the weighting of commodity expenses, expected production and performance of oil and natural gas properties, results and timing of projects, access to adequate pipeline capacity and third-party infrastructure, growth expectations, supply and demand for oil, natural gas liquids and natural gas, industry conditions, government regulations and regimes, capital expenditures and the nature of capital expenditures and the timing and method of financing thereof, may constitute 'forward-looking statements' or 'forward-looking information' within the meaning of applicable securities laws (collectively 'forward-looking statements'). Words such as 'may', 'will', 'should', 'could', 'anticipate', 'believe', 'expect', 'intend', 'plan', 'continue', 'focus', 'endeavor', 'commit', 'shall', 'propose', 'might', 'project', 'predict', 'vision', 'opportunity', 'strategy', 'objective', 'potential', 'forecast', 'estimate', 'goal', 'target', 'growth', 'future', and similar expressions may be used to identify these forward-looking statements. These statements reflect management's current beliefs and are based on information currently available to management. Forward-looking statements involve significant risk and uncertainties. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements including, but not limited to, the risks associated with oil and gas exploration, development, exploitation, production, processing, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of resources estimates, environmental risks, competition from other producers, incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, delays resulting from or inability to obtain required regulatory approvals, ability to access sufficient capital from internal and external sources and the risk factors outlined under 'Risk Factors' and elsewhere herein. The recovery and resources estimate of Cavvy's reserves provided herein are estimates only and there is no guarantee that the estimated resources will be recovered. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Forward-looking statements are based on a number of factors and assumptions which have been used to develop such forward-looking statements, but which may prove to be incorrect. Although Cavvy believes that the expectations reflected in such forward-looking statements are reasonable, undue reliance should not be placed on forward-looking statements because Cavvy can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified in this document, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which Cavvy operates; the timely receipt of any required regulatory approvals; the ability of Cavvy to obtain and retain qualified staff, equipment and services in a timely and cost efficient manner; the ability of the operator of the projects which Cavvy has an interest in to operate the field in a safe, efficient and effective manner; the ability of Cavvy to obtain financing on acceptable terms; the ability to replace and expand oil and natural gas resources through acquisition, development and exploration; the timing and costs of pipeline, storage and facility construction and expansion and the ability of Cavvy to secure adequate product transportation; future oil and natural gas prices; currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which Cavvy operates; timing and amount of capital expenditures; future sources of funding; production levels; weather conditions; success of exploration and development activities; access to gathering, processing and pipeline systems; advancing technologies; and the ability of Cavvy to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could affect Cavvy's operations and financial results are included in reports on file with Canadian securities regulatory authorities and may be accessed through the SEDAR+ website ( and at Cavvy's website ( Although the forward-looking statements contained herein are based upon what management believes to be reasonable assumptions, management cannot assure that actual results will be consistent with these forward-looking statements. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and Cavvy assumes no obligation to update or review them to reflect new events or circumstances except as required by applicable securities laws. Forward-looking statements contained herein concerning the oil and gas industry and Cavvy's general expectations concerning this industry are based on estimates prepared by management using data from publicly available industry sources as well as from reserve reports, market research and industry analysis and on assumptions based on data and knowledge of this industry which Cavvy believes to be reasonable. However, this data is inherently imprecise, although generally indicative of relative market positions, market shares and performance characteristics. While Cavvy is not aware of any misstatements regarding any industry data presented herein, the industry involves risks and uncertainties and is subject to change based on various Reader AdvisoriesBarrels of oil equivalent ('boe') may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf: 1 boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Abbreviations Natural Gas Liquids Mcf thousand cubic feet bbl/d barrels per day Mcf/d thousand cubic feet per day boe/d barrels of oil equivalent per day MMcf/d million cubic feet per day WTI West Texas Intermediate AECO Alberta benchmark price for natural gas Mbbl Thousand barrels GJ Gigajoule MMbbl Million barrels Power MMboe Million barrels of oil equivalent MW Megawatt C2 Ethane MWh Megawatt hour C3 Propane C4 Butane C5/C5+ Condensate / Pentane Neither the TSX nor its Regulation Services Provider (as that term is defined in policies of the TSX) accepts responsibility for the adequacy or accuracy of this releaseError in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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Second Quarter 2025 Highlights Total revenues for the quarter increased 13.8% to $60.3 million, compared to $53.0 million in the prior year period Commission income for the quarter increased 12.1% to $54.6 million, compared to $48.7 million in the prior year period Net income for the quarter was $9.0 million, compared to $6.9 million in the prior year period, and net income margin for the quarter was 14.9% Diluted Earnings Per Share for the quarter was $0.13 and Adjusted Diluted Earnings Per Share* for the quarter was $0.20 Total Written Premium for the quarter increased 14.4% to $450.3 million, compared to $393.6 million in the prior year period Organic Revenue Growth Rate* for the quarter was 10.6% Adjusted Net Income* for the quarter increased 17.3% from the prior year period to $11.5 million, and Adjusted Net Income Margin* for the quarter was 19.1% Adjusted EBITDA* for the quarter increased 40.7% over the prior year period to $15.1 million, and Adjusted EBITDA Margin* for the quarter was 25.1% compared to 20.3% in the prior year period *Organic Revenue Growth Rate, Adjusted Net Income, Adjusted Net Income Margin, Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Free Cash Flow and Adjusted Diluted Earnings Per Share are non-GAAP measures. 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The increase includes $1.5 million of equity compensation expense and $1.2 million in salaries and employee benefit expenses related to 2025 corporate branch acquisitions as well as increased headcount and overall business growth. Other administrative expenses for the quarter were $5.4 million, an increase of 44.2% compared to $3.7 million in the same period in the prior year. The increase reflects investments to support business growth and the absorption of public company operating costs. For the second quarter of 2025, net income was $9.0 million and net income margin was 14.9%, compared to net income of $6.9 million and net income margin of 13.1% in the same period in the prior year. Adjusted Net Income was $11.5 million and Adjusted Net Income Margin was 19.1% compared to Adjusted Net Income of $9.8 million and Adjusted Net Income Margin of 18.5% in the same period in the prior year. Adjusted EBITDA for the second quarter was $15.1 million, an increase of 40.7% over the same period in the prior year. Adjusted EBITDA Margin expanded to 25.1%, compared to 20.3% in the second quarter of 2024. Cash flow from operating activities for the second quarter 2025 was $9.6 million, compared to $7.4 million in the same period in the prior year. Adjusted Free Cash Flow for the second quarter of 2025 was $2.9 million, compared to $3.7 million in the same period in the prior year, primarily driven by distributions to our pre-IPO members. Liquidity and Capital Resources As of June 30, 2025, the Company had cash and cash equivalents of $159.8 million. We had full unused capacity on our revolving credit facility of $50.0 million as of June 30, 2025. The total outstanding term notes payable balance was $5.0 million as of June 30, 2025. 2025 Updated Outlook Based on the midpoint results for 2025 and current market conditions, the Company has updated its full-year 2025 guidance as follows. Total Revenues: Expected to be between $240 million and $255 million Organic Revenue Growth Rate*: Expected to be in the range of 11% to 14% Adjusted EBITDA Margin*: Expected to be in the range of 21% to 23% The Company is unable to provide a reconciliation to the most directly comparable GAAP measures without unreasonable efforts due to the inherent difficulty in forecasting the timing of items that have not yet occurred, as well as quantifying certain amounts that are necessary for such reconciliation. *For a definition of Organic Revenue Growth Rate and Adjusted EBITDA Margin, see 'Non-GAAP Financial Measures' below. Conference Call Information TWFG will host a conference call and webcast tomorrow at 10:00 AM ET to discuss these results. To access the call by phone, participants should REGISTER AT THIS LINK, where they will be provided with the dial in details. A live webcast of the conference call will also be available on TWFG's investor relations website at A webcast replay of the call will be available at for one year following the call. About TWFG TWFG (NASDAQ: TWFG) is a high-growth, independent distribution platform for personal and commercial insurance in the United States and represents hundreds of insurance carriers that underwrite personal lines and commercial lines risks. For more information, please visit Forward-Looking Statements This press release contains 'forward-looking statements' within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. All statements, other than statements of historical fact included in this release, are forward-looking statements. Forward-looking statements give our current expectations relating to our financial condition, results of operations, plans, objectives, future performance, and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. In some cases, you can identify these statements by forward-looking words such as 'may,' 'might,' 'will,' 'should,' 'expects,' 'plans,' 'anticipates,' 'believes,' 'estimates,' 'outlook,' 'predicts,' 'potential' or 'continue,' the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed under the captions entitled 'Risk factors' and 'Management's Discussion and Analysis of Financial Condition and Results of Operations' in the Company's Annual Report on Form 10-K, any Quarterly Reports on Form 10-Q and the other documents that the Company files with the U.S. Securities and Exchange Commission. You should specifically consider the numerous risks outlined under 'Risk factors' in the Annual Report on Form 10-K for the year ended December 31, 2024. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Non-GAAP Financial Measures and Key Performance IndicatorsOrganic Revenue, Organic Revenue Growth, Adjusted Net Income, Adjusted Net Income Margin, Adjusted Diluted Earnings Per Share, Adjusted EBITDA, Adjusted EBITDA Margin and Adjusted Free Cash Flow included in this release are not measures of financial performance in accordance with generally accepted accounting principles in the United States of America ('GAAP') and should not be considered substitutes for GAAP measures, including revenues (for Organic Revenue and Organic Revenue Growth), net income (for Adjusted Net Income, Adjusted Net Income Margin, Adjusted EBITDA and Adjusted EBITDA Margin), diluted earnings per share (Adjusted Diluted Earnings Per Share), and cash flow from operating activities (for Adjusted Free Cash Flow), which we consider to be the most directly comparable GAAP measures. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, you should not consider these non-GAAP financial measures in isolation or as substitutes for revenues, net income, operating cash flow or other consolidated financial statement data prepared in accordance with GAAP. Other companies may calculate any or all of these non-GAAP financial measures differently than we do, limiting their usefulness as comparative measures. Since the first quarter of 2025, we have utilized the revised calculation methodology for Organic Revenue to include policy fee income as it is directly correlated to MGA commission income. Our legacy calculation methodology removed policy fee income from Organic Revenue. Organic Revenue is total revenue (the most directly comparable GAAP measure) for the relevant period, excluding contingent income, non-policy fee income, other income and those revenues generated from acquired businesses with over $0.5 million in annualized revenue that have not reached the twelve-month owned mark. Organic Revenue Growth is the change in Organic Revenue period-to-period, with prior period results adjusted to include revenues that were excluded in the prior period because the relevant acquired businesses had not reached the twelve-month-owned milestone but have reached the twelve-month owned milestone in the current period. We believe Organic Revenue Growth is an appropriate measure of operating performance because it eliminates the impact of acquisitions, which affects the comparability of results from period to period. Adjusted Net Income is a supplemental measure of our performance and is defined as net income (the most directly comparable GAAP measure) before amortization, non-recurring or non-operating income and expenses, including equity-based compensation, adjusted to assume a single class of stock (Class A) and assuming noncontrolling interests do not exist. We believe Adjusted Net Income is a useful measure because it adjusts for the after-tax impact of significant one-time, non-recurring items and eliminates the impact of any transactions that do not directly affect what management considers to be our ongoing operating performance in the period. These adjustments generally eliminate the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. We are subject to U.S. federal income taxes, in addition to state, and local taxes, with respect to our allocable share of any net taxable income of TWFG Holding Company, LLC. Adjusted Net Income pre-IPO did not reflect adjustments for income taxes since TWFG Holding Company, LLC is a limited liability company and is classified as a partnership for U.S. federal income tax purposes. Post-IPO, the calculation incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of TWFG Holding Company, LLC. Adjusted Net Income Margin is Adjusted Net Income divided by total revenues. We believe that Adjusted Net Income Margin is a useful measurement of operating profitability for the same reasons we find Adjusted Net Income useful and also because it provides a period-to-period comparison of our after-tax operating performance. Adjusted Diluted Earnings Per Share is Adjusted Net Income divided by diluted shares outstanding after adjusting for the effect of (i) the exchange of 100% of the outstanding Class B common stock of the Company (the 'Class B Common Stock') and Class C common stock of the Company (the 'Class C Common Stock') (together with the related limited liability units in TWFG Holding Company, LLC (the 'LLC Units')) into shares of Class A common stock of the Company ('Class A Common Stock') and (ii) the vesting of 100% of the unvested equity awards and exchange into shares of Class A Common Stock. This measure does not deduct earnings related to the noncontrolling interests in TWFG Holding Company, LLC for the period prior to July 19, 2024, when we did not own 100% of the business. The most directly comparable GAAP financial metric is diluted earnings per share. We believe Adjusted Diluted Earnings Per Share may be useful to an investor in evaluating our operating performance and efficiency because this measure is widely used by investors to measure a company's operating performance without regard to items excluded from the calculation of such measure, which can vary substantially from company to company depending upon acquisition activity and capital structure. This measure also eliminates the impact of expenses that do not relate to core business performance, among other factors. Adjusted EBITDA is a supplemental measure of our performance and is defined as EBITDA adjusted to reflect items such as equity-based compensation, interest income, other non-operating and certain nonrecurring items. EBITDA is defined as net income (the most directly comparable GAAP measure) before interest, income taxes, depreciation, and amortization. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it adjusts for significant one-time, non-recurring items and eliminates the ongoing accounting effects of certain capital spending and acquisitions, such as depreciation and amortization, that do not directly affect what management considers to be our ongoing operating performance in the period. These adjustments eliminate the effects of certain items that may vary from company to company for reasons unrelated to overall operating performance. Our measure of Adjusted EBITDA is not necessarily comparable to other similarly titled captions of other companies due to potential inconsistencies in the methods of calculation. Adjusted EBITDA Margin is Adjusted EBITDA divided by total revenue. We believe that Adjusted EBITDA Margin is a useful measurement of operating profitability for the same reasons we find Adjusted EBITDA useful and also because it provides a period-to-period comparison of our operating performance. Adjusted Free Cash Flow is a supplemental measure of our performance. We define Adjusted Free Cash Flow as cash flow from operating activities (the most directly comparable GAAP measure) less cash payments for tax distributions, purchases of property and equipment and acquisition-related costs. We believe Adjusted Free Cash Flow is a useful measure of operating performance because it represents the cash flow from the business that is within our discretion to direct to activities including investments, debt repayment, and returning capital to stockholders. The reconciliation of the above non-GAAP measures to their most comparable GAAP financial measure is outlined in the reconciliation table accompanying this Written Premium represents, for any reported period, the total amount of current premium (net of cancellation) placed with insurance carriers. We utilize Total Written Premium as a key performance indicator when planning, monitoring, and evaluating our performance. We believe Total Written Premium is a useful metric because it is the underlying driver of the majority of our revenue. ContactsInvestor Contact:Gene Padgett, CAO for TWFGEmail: PR Contact:Alex Bunch, CMO for TWFGEmail: alex@ Consolidated Statements of Income (Unaudited)(Amounts in thousands, except share and per share data) Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Revenues Commission income(1) $ 54,562 $ 48,662 $ 103,347 $ 91,207 Contingent income 2,033 1,258 3,696 2,334 Fee income(2) 3,329 2,689 6,340 4,921 Other income 384 402 748 693 Total revenues 60,308 53,011 114,131 99,155 Expenses Commission expense 34,151 31,962 65,965 58,405 Salaries and employee benefits 9,493 6,816 17,689 13,070 Other administrative expenses(3) 5,400 3,744 10,124 6,874 Depreciation and amortization 3,901 2,968 7,260 5,981 Total operating expenses 52,945 45,490 101,038 84,330 Operating income 7,363 7,521 13,093 14,825 Interest expense 68 872 151 1,714 Interest income 1,751 255 3,614 424 Other non-operating income, net 574 14 573 12 Income before tax 9,620 6,918 17,129 13,547 Income tax expense 620 — 1,276 — Net income 9,000 6,918 15,853 13,547 Less: net income attributable to noncontrolling interests 7,043 6,918 12,558 13,547 Net income attributable to TWFG, Inc. $ 1,957 $ — $ 3,295 $ — Weighted average shares of common stock outstanding: Basic 14,904,083 14,896,951 Diluted 56,278,869 15,083,695 Earnings per share: Basic $ 0.13 $ 0.22 Diluted $ 0.13 $ 0.22 (1) Commission income - related party of $2,784 and $1,912 for the three months ended and $5,918 and $3,021 for the six months ended June 30, 2025 and 2024, respectively(2) Fee income - related party of $893 and $561 for the three months ended and $1,727 and $915 for the six months ended June 30, 2025 and 2024, respectively(3) Other administrative expenses - related party of $779 and $382 for the three months ended and $1,549 and $783 for the six months ended June 30, 2025 and 2024, respectivelyThe following table presents the disaggregation of our revenues by offerings (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Insurance Services Agency-in-a-Box $ 39,316 $ 34,422 $ 75,312 $ 66,151 Corporate Branches 11,393 9,351 19,615 16,627 Total Insurance Services 50,709 43,773 94,927 82,778 TWFG MGA 9,233 8,830 18,428 15,625 Other 366 408 776 752 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 The following table presents the disaggregation of our commission income by offerings (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Insurance Services Agency-in-a-Box $ 36,275 $ 32,259 $ 69,634 $ 62,159 Corporate Branches 11,294 9,412 19,508 16,662 Total Insurance Services 47,569 41,671 89,142 78,821 TWFG MGA 6,993 6,991 14,205 12,386 Total commission income $ 54,562 $ 48,662 $ 103,347 $ 91,207 The following table presents the disaggregation of our fee income by major sources (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Policy fees $ 1,082 $ 933 $ 2,134 $ 1,446 Branch fees 1,416 1,220 2,671 2,351 License fees 559 444 1,167 959 TPA fees 272 92 368 165 Total fee income $ 3,329 $ 2,689 $ 6,340 $ 4,921 The following table presents the disaggregation of our commission expense by offerings (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Insurance Services Agency-in-a-Box $ 28,013 $ 25,529 $ 53,967 47,557 Corporate Branches 1,568 1,256 2,674 2,118 Total Insurance Services 29,581 26,785 56,641 49,675 TWFG MGA 4,544 5,158 9,270 8,693 Other 26 19 54 37 Total commission expense $ 34,151 $ 31,962 $ 65,965 $ 58,405 Condensed Consolidated Balance Sheets (Unaudited)(Amounts in thousands, except share/unit data) June 30, 2025 December 31, 2024 Assets Current assets Cash and cash equivalents $ 159,827 $ 195,772 Restricted cash 11,174 9,551 Commissions receivable, net 25,234 27,067 Accounts receivable 9,353 7,839 Other current assets, net 2,937 1,619 Total current assets 208,525 241,848 Non-current assets Intangible assets, net 125,901 72,978 Property and equipment, net 3,263 3,499 Lease right-of-use assets, net 4,381 4,493 Other non-current assets 779 610 Total assets $ 342,849 $ 323,428 Liabilities, Redeemable Noncontrolling Interest and Equity Current liabilities Commissions payable $ 16,223 $ 13,848 Carrier liabilities 15,225 12,392 Operating lease liabilities, current 1,355 1,013 Short-term bank debt 1,942 1,912 Deferred acquisition payable, current 1,954 601 Other current liabilities 8,695 9,851 Total current liabilities 45,394 39,617 Non-current liabilities Operating lease liabilities, net of current portion 3,008 3,372 Long-term bank debt 3,028 4,007 Deferred acquisition payable, non-current 2,448 1,122 Other non-current liabilities — 24 Total liabilities 53,878 48,142 Commitments and contingencies (Note 13) Redeemable noncontrolling interests 9,761 — Stockholders' Equity Class A common stock ($0.01 par value per share - 300,000,000 authorized, 14,904,083 and 14,811,874 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively ) 149 148 Class B common stock ($0.00001 par value per share - 100,000,000 authorized, 7,277,651 shares issued and outstanding at June 30, 2025 and December 31, 2024) — — Class C common stock ($0.00001 par value per share - 100,000,000 authorized, 33,893,810 shares issued and outstanding at June 30, 2025 and December 31, 2024) — — Additional paid-in capital 59,889 58,365 Retained earnings 18,583 15,288 Accumulated other comprehensive income 52 83 Total stockholders' equity attributable to TWFG, Inc. 78,673 73,884 Noncontrolling interests 200,537 201,402 Total stockholders' equity 279,210 275,286 Total liabilities, redeemable noncontrolling interest and equity $ 342,849 $ 323,428 Non-GAAP Financial Measures A reconciliation of Organic Revenue and Organic Revenue Growth Rate to Total Revenue and Total Revenue Growth Rate, the most directly comparable GAAP measures, is as follows (in thousands): Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 Acquisition adjustments(1) (1,524 ) (1,217 ) (2,133 ) (2,684 ) Contingent income (2,033 ) (1,258 ) (3,696 ) (2,334 ) Fee income (3,329 ) (2,689 ) (6,340 ) (4,921 ) Policy fee income 1,082 933 2,134 1,446 Other income (384 ) (402 ) (748 ) (693 ) Organic Revenue $ 54,120 $ 48,378 $ 103,348 $ 89,969 Organic Revenue Growth(2) $ 5,196 $ 6,159 $ 11,366 $ 10,756 Total Revenue Growth Rate(3) 13.8 % 17.2 % 15.1 % 16.5 % Organic Revenue Growth Rate(2) 10.6 % 14.6 % 12.4 % 13.6 % (1) Represents revenues generated from the acquired businesses during the first 12 months following an acquisition.(2) Revised Organic Revenue for the three months ended June 30, 2024 and 2023, and for the six months ended June 30, 2024 and 2023 used to calculate Organic Revenue Growth for the three months ended June 30, 2025 and 2024, was $48.9 million, $42.2 million, $92.0 million, and $79.2 million respectively, which is adjusted to reflect revenues from acquired businesses with over $0.5 million in annualized revenue that reached the twelve-month owned mark during the three and six months ended June 30, 2025 and 2024, respectively. Organic Revenue Growth Rate represents the period-to-period change in Organic Revenue divided by the total adjusted Organic Revenue in the prior period.(3) Represents the period-to-period change in total revenues divided by the total revenues in the prior period. Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 Acquisition adjustments(1) (1,524 ) (1,217 ) (2,133 ) (2,684 ) Contingent income (2,033 ) (1,258 ) (3,696 ) (2,334 ) Fee income (3,329 ) (2,689 ) (6,340 ) (4,921 ) Other income (384 ) (402 ) (748 ) (693 ) Organic Revenue $ 53,038 $ 47,445 $ 101,214 $ 88,523 Organic Revenue Growth(2) $ 5,047 $ 5,747 $ 10,678 $ 10,386 Total Revenue Growth Rate(3) 13.8 % 17.2 % 15.1 % 16.5 % Organic Revenue Growth Rate(2) 10.5 % 13.8 % 11.8 % 13.3 % (1) Represents revenues generated from the acquired businesses during the first 12 months following an acquisition.(2) Revised Organic Revenue for the three months ended June 30, 2024 and 2023, and for the six months ended June 30, 2024 and 2023 used to calculate Organic Revenue Growth for the three months ended June 30, 2025 and 2024, was $48.0 million, $41.7 million, $90.5 million, and $78.1 million respectively, which is adjusted to reflect revenues from acquired businesses with over $0.5 million in annualized revenue that reached the twelve-month owned mark during the three and six months ended June 30, 2025 and 2024, respectively. Organic Revenue Growth Rate represents the period-to-period change in Organic Revenue divided by the total adjusted Organic Revenue in the prior period.(3) Represents the period-to-period change in total revenues divided by the total revenues in the prior period.A reconciliation of Adjusted Net Income and Adjusted Net Income Margin to Net income and Net income Margin, the most directly comparable GAAP measures, for each of the periods indicated is as follows (in thousands): Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 Net income $ 9,000 $ 6,918 $ 15,853 $ 13,547 Income tax expense 620 — 1,276 — Acquisition-related expenses 19 — 52 — Equity-based compensation 1,515 — 2,719 — Other non-recurring items(1) 10 — 10 (1,477 ) Amortization expense 3,762 2,904 6,971 5,851 Adjusted income before income taxes 14,926 9,822 26,881 17,921 Adjusted income tax expense(2) (3,407 ) — (6,135 ) — Adjusted Net Income $ 11,519 $ 9,822 $ 20,746 $ 17,921 Net Income Margin 14.9 % 13.1 % 13.9 % 13.7 % Adjusted Net Income Margin 19.1 % 18.5 % 18.2 % 18.1 % Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 Net income $ 9,000 $ 6,918 $ 15,853 $ 13,547 Income tax expense 620 — 1,276 — Acquisition-related expenses 19 — 52 — — Equity-based compensation 1,515 — 2,719 — — Other non-recurring items(1) 10 — 10 — (1,477 ) Adjusted income before income taxes 11,164 6,918 19,910 12,070 Adjusted income tax expense(2) (2,548 ) — (4,544 ) — Adjusted Net Income $ 8,616 $ 6,918 $ 15,366 $ 12,070 Net Income Margin 14.9 % 13.1 % 13.9 % 13.7 % Adjusted Net Income Margin 14.3 % 13.1 % 13.5 % 12.2 % (1) Represents a one-time adjustment reducing commission expense, which resulted from the branch conversions. In January 2024, nine of our Branches converted to Corporate Branches. Upon conversion, agents of the newly converted Corporate Branches became employees and received salaries, employee benefits, and bonuses for services rendered instead of commissions. As a result, we released a portion of the unpaid commissions related to the converted branches that we no longer are required to settle.(2) Post-IPO, we are subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect to our allocable share of any net taxable income of TWFG Holding Company, LLC. For the three and six months ended June 30, 2025, the calculation of adjusted income tax expense is based on a federal statutory rate of 21% and a blended state income tax rate of 1.82% on 100% of our adjusted income before income taxes as if we owned 100% of the TWFG Holding Company, LLC.A reconciliation of Adjusted EBITDA and Adjusted EBITDA Margin to Net income and Net income margin, the most directly comparable GAAP measures, for each of the periods indicated is as follows (in thousands): Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Total revenues $ 60,308 $ 53,011 $ 114,131 $ 99,155 Net income $ 9,000 $ 6,918 $ 15,853 $ 13,547 Interest expense 68 872 151 1,714 Interest income (1,751 ) (255 ) (3,614 ) (424 ) Depreciation and amortization 3,901 2,968 7,260 5,981 Income tax expense 620 — 1,276 — EBITDA 11,838 10,503 20,926 20,818 Acquisition-related expenses 19 — 52 — Equity-based compensation 1,515 — 2,719 — Interest income 1,751 255 3,614 424 Other non-recurring items(1) 10 — 10 (1,477 ) Adjusted EBITDA $ 15,133 $ 10,758 $ 27,321 $ 19,765 Net Income Margin 14.9 % 13.1 % 13.9 % 13.7 % Adjusted EBITDA Margin 25.1 % 20.3 % 23.9 % 19.9 % (1) Represents a one-time adjustment reducing commission expense, which resulted from the branch conversions. In January 2024, nine of our Branches converted to Corporate Branches. Upon conversion, agents of the newly converted Corporate Branches became employees and received salaries, employee benefits, and bonuses for services rendered instead of commissions. As a result, we released a portion of the unpaid commissions related to the converted branches that we no longer are required to settle.A reconciliation of Adjusted Free Cash Flow to Cash Flow from Operating Activities, the most directly comparable GAAP measure, for each of the periods indicated is as follows (in thousands): Three Months EndedJune 30, Six Months EndedJune 30, 2025 2024 2025 2024 Cash Flow from Operating Activities $ 9,615 $ 7,400 $ 25,260 $ 17,154 Purchase of property and equipment (44 ) (39 ) (59 ) (47 ) Tax distribution to members(1) (6,728 ) (3,685 ) (8,752 ) (6,104 ) Acquisition-related expenses 19 — 52 — Adjusted Free Cash Flow $ 2,862 $ 3,676 $ 16,501 $ 11,003 (1) Tax distributions to members represents the amount distributed to the members of TWFG Holding Company, LLC in respect of their income tax liability related to the net income of TWFG Holding Company, LLC allocated to its members.A reconciliation of Adjusted Diluted Earnings Per Share to diluted earnings per share, the most directly comparable GAAP measure, is as follows: Three Months EndedJune 30, Six Months EndedJune 30, 2025 2025 Earnings per share of common stock – diluted $ 0.13 $ 0.22 Plus: Impact of all LLC Units exchanged for Class A Common Stock(1) 0.03 0.06 Plus: Adjustments to Adjusted net income(2) 0.04 0.09 Adjusted Diluted Earnings Per Share $ 0.20 $ 0.37 Weighted average common stock outstanding – diluted 56,278,869 15,083,695 Plus: Impact of all LLC Units exchanged for Class A Common Stock(1) — 41,171,461 Adjusted Diluted Earnings Per Share diluted share count 56,278,869 56,255,156 (1) For comparability purposes, this calculation incorporates the net income that would be distributable if all shares of Class B Common Stock and Class C Common Stock, together with the related LLC Units, were exchanged for shares of Class A Common Stock. For the three and six months ended June 30, 2025, this includes $7.0 million of net income on 56,278,869 weighted-average shares of common stock outstanding - diluted and $12.6 million of net income on 56,255,156 weighted-average shares of common stock outstanding - diluted, respectively. For the three and six months ended June 30, 2025, — weighted average outstanding Class B Common Stock and Class C Common Stock were considered dilutive and included in the 56,278,869 and 56,255,156 weighted-average shares of common stock outstanding - diluted within diluted earnings per share calculation, respectively.(2) Adjustments to Adjusted Net Income are described in the footnotes of the reconciliation of Adjusted Net Income to Net Income in 'Adjusted Net Income and Adjusted Net Income Margin', which represent the difference between Net Income of $9.0 million and Adjusted Net Income of $11.5 million and Net Income of $15.9 million and Adjusted Net Income of $20.7 million for the three and six months ended June 30, 2025, respectively. For the three and six months ended June 30, 2025, Adjusted Diluted Earnings Per Share include adjustments of $2.5 million to Adjusted Net Income on 56,278,869 weighted-average shares of common stock outstanding - diluted and $4.9 million to Adjusted Net Income on 56,255,156 weighted-average shares of common stock outstanding - diluted for the period presented, Performance Indicators The following presents the disaggregation of Total Written Premium by offerings, business mix and line of business (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 Amount % of Total Amount % of Total Amount % of Total Amount % of Total Offerings: Insurance Services Agency-in-a-Box $ 293,846 65 % $ 256,203 65 % $ 543,321 66 % $ 475,139 66 % Corporate Branches 95,551 21 78,169 20 163,650 20 136,053 19 Total Insurance Services 389,397 86 334,372 85 706,971 86 611,192 85 TWFG MGA 60,891 14 59,263 15 114,280 14 103,709 15 Total written premium $ 450,288 100 % $ 393,635 100 % $ 821,251 100 % $ 714,901 100 % Business Mix: Insurance Services Renewal business $ 301,930 67 % $ 260,121 66 % $ 546,775 67 % $ 474,598 66 % New business 87,467 19 74,251 19 160,196 20 136,594 19 Total Insurance Services $ 389,397 86 $ 334,372 85 $ 706,971 87 $ 611,192 85 TWFG MGA Renewal business $ 47,366 11 $ 43,825 11 $ 83,741 10 $ 79,289 11 New business 13,525 3 15,438 4 30,539 3 24,420 4 Total TWFG MGA 60,891 14 59,263 15 114,280 13 103,709 15 Total written premium $ 450,288 100 % $ 393,635 100 % $ 821,251 100 % $ 714,901 100 % Written Premium Retention: Insurance Services 90 % 94 % 89 % 95 % TWFG MGA 80 85 81 84 Consolidated 89 93 88 93 Line of Business: Personal lines $ 365,409 81 % $ 322,349 82 % $ 663,699 81 % $ 577,213 81 % Commercial lines 84,879 19 71,286 18 157,552 19 137,688 19 Total written premium $ 450,288 100 % $ 393,635 100 % $ 821,251 100 % $ 714,901 100 % Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
