OCTAVE SPECIALTY GROUP INC
For the period ended Dec 31, 2025. Filed Mar 4, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 4, 2026
Contents
Non-GAAP Financial Measures
In addition to reporting the Company’s quarterly financial results in accordance with GAAP, the Company is reporting non-GAAP financial measures: EBITDA, Adjusted EBITDA and Adjusted EBITDA Margin, Organic Revenue Growth Rate (Insurance Distribution segment only), Adjusted Net Income and Adjusted Net Income Margin. These amounts are derived from our consolidated financial information, but are not presented in our consolidated financial results.
We present non-GAAP supplemental financial information because we believe such information is of interest to the investment community, and that it provides greater transparency and enhanced visibility into the underlying drivers and performance of our businesses on a basis that may not be otherwise apparent on a GAAP basis. We view these non-GAAP financial measures as important indicators when assessing and evaluating our performance on a segmented and consolidated basis and they are presented to improve the comparability of our results between periods by eliminating the impact of the items that may not be representative of our core operating performance. These non-GAAP financial measures are not substitutes for the Company’s GAAP reporting, should not be viewed in isolation and may differ from similar reporting provided by other companies, which may define non-GAAP measures differently.
Beginning December 31, 2024, Octave replaced the non-GAAP measure Adjusted Net Income with new non-GAAP measures Adjusted Net Income and Adjusted Net Income Margin and added Adjusted EBITDA and Adjusted EBITDA Margin to better align with other participants in the Property & Casualty insurance industry, including insurance carriers and other peers in the insurance distribution business.
The following paragraphs define each non-GAAP financial measure. A tabular reconciliation of the non-GAAP financial measure and the most comparable GAAP financial measure is also presented below.
EBITDA — EBITDA is net income (loss) from continuing operations before interest expense, income taxes, depreciation and amortization of intangible assets.
Adjusted EBITDA and Adjusted EBITDA Margin — We define Adjusted EBITDA as net income (loss) from continuing operations before interest expense, income taxes, depreciation, amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration-related expenses, severance, and other exceptional or non-recurring items, including those related to raising capital. We believe that Adjusted EBITDA is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance, and that the presentation of this measure enhances an investor's understanding of our financial performance.
| Year Ended December 31, | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2023 | ||||||||||
| Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Total | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Total | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Total | |
| Net income (loss) from continuing operations | $2,956 | $(15,353) | $(83,406) | $(95,803) | $10,469 | $(6,881) | $(62,509) | $(58,921) | $335 | $7,133 | $(30,701) | $(23,232) |
| Adjustments: | ||||||||||||
| Interest expense | — | 18,640 | — | 18,640 | — | 9,379 | — | 9,379 | — | — | — | — |
| Income taxes | 374 | (5,103) | (482) | (5,211) | 1,753 | (928) | (1,748) | (924) | 48 | 156 | (1,193) | (989) |
| Depreciation | — | 690 | 3,218 | 3,908 | — | 481 | 1,864 | 2,345 | — | 42 | 1,036 | 1,078 |
| Intangible amortization | — | 38,044 | — | 38,044 | — | 17,602 | — | 17,602 | — | 4,152 | — | 4,152 |
| EBITDA | 3,330 | 36,918 | (80,670) | (40,422) | 12,222 | 19,653 | (62,393) | (30,518) | 383 | 11,483 | (30,858) | (18,991) |
| Add: Impact of noncontrolling interests | — | (14,507) | — | (14,507) | — | (6,448) | — | (6,448) | — | (2,102) | — | (2,102) |
| EBITDA attributable to shareholders | 3,330 | 22,411 | (80,670) | (54,929) | 12,222 | 13,205 | (62,393) | (36,966) | 383 | 9,381 | (30,858) | (21,094) |
| Net income margin | — | — | NM | — | — | — | NM | — | — | — | NM | — |
| Net income margin attributable to shareholders | — | — | NM | — | — | — | NM | — | — | — | NM | — |
| EBITDA margin | — | — | NM | — | — | — | NM | — | — | — | NM | — |
| EBITDA margin attributable to shareholders | — | — | NM | — | — | — | NM | — | — | — | NM | — |
| Add: Acquisition and integration related expenses | — | 375 | 9,106 | 9,481 | — | — | 27,388 | 27,388 | — | — | 567 | 567 |
| Add: Equity-based compensation expense | 447 | 368 | 11,494 | 12,309 | 414 | — | 8,941 | 9,355 | 634 | — | 11,632 | 12,266 |
| Add: Severance and restructuring expense | — | 60 | 21,173 | 21,233 | — | 248 | 7,352 | 7,600 | — | — | — | — |
| Add: Other non-operating (income) losses | — | (591) | 5,108 | 4,517 | (7,500) | — | 2,318 | (5,182) | — | — | 279 | 279 |
| Adjusted EBITDA | 3,777 | 37,041 | (33,789) | 7,028 | 5,136 | 19,901 | (16,394) | 8,643 | 1,017 | 11,483 | (18,380) | (5,879) |
| Adjusted EBITDA attributable to shareholders | $3,777 | $22,542 | $(33,789) | $(7,471) | $5,136 | $13,453 | $(16,394) | $2,195 | $1,017 | $9,381 | $(18,380) | $(7,981) |
| Adjusted EBITDA Margin | 4.3% | 22.6% | NM | 2.8% | 4.1% | 20.1% | NM | 3.7% | 1.6% | 22.3% | NM | (4.7)% |
| Adjusted EBITDA Margin attributable to shareholders | 4.3% | 13.8% | NM | (3.0)% | 4.1% | 13.6% | NM | 0.9% | 1.6% | 18.2% | NM | (6.2)% |
Organic Revenue Growth
(Insurance Distribution only)
Organic revenue is based on commissions and fees for the relevant period by excluding (i) the first twelve months of commissions and fees generated from acquisitions, (ii) commissions and fees from divestitures and (iii) other items such as contingent commissions, profit commissions and the impact of changes in foreign exchange rates.
Organic revenue growth is the change in organic revenue period-to-period, with prior period results adjusted to (i) include commissions and fees that were excluded from organic revenue in the prior period and reached the twelve-month owned mark in the current period and (ii) exclude commissions and fees related to divestitures from organic revenue.
Organic revenue growth rate to Total revenue growth rate, the most directly comparable GAAP measure, for each of the periods indicated is as follows (in percentages):
| Year Ended December 31, · Year Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| 2025 | 2024 | % Growth | 2024 | 2023 | % Growth | |
| Total Insurance Distribution revenue (1) | $163,855 | $99,236 | 65.1% | $99,236 | $51,546 | 92.5% |
| Less: Acquired revenues (2) | (50,102) | (1,200) | (45,202) | — | ||
| Less: Profit commission and contingent commission income | (11,898) | (9,031) | (4,273) | (4,489) | ||
| Less: Impact of F.X. rates | 2,572 | (183) | — | — | ||
| Total Organic Revenue & Growth Percentage | $104,427 | $88,822 | 17.6% | $49,761 | $47,057 | 5.7% |
(1)Total ID revenue includes investment income.
(2)Organic revenue growth includes a $1.2m reduction to 4Q24 revenue to adjust for a revenue recognition accounting policy adjustment made in 4Q24 in connection with the acquisition of Octave Ventures to recognize revenues that otherwise should have been recorded in 3Q24.
Adjusted Net Income and Adjusted Net Income Margin —We define Adjusted Net Income as net income (loss) from continuing operations attributable to Octave adjusted for amortization of intangible assets, change in fair value of contingent consideration and certain items of income and expense, including share-based compensation expense, acquisition and integration -related expenses, severance and non-recurring income and loss items that, in the opinion of management, significantly affect the period-over-period assessment of operating results, and the related tax effect of those adjustments. Per share amounts exclude any impact of revaluing non-controlling interests as otherwise reported under GAAP earnings per share. We believe that Adjusted Net Income is an appropriate measure of operating performance because it eliminates the impact of income and expenses that may obfuscate business performance.
| Year Ended December 31, | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2023 | ||||||||||
| Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | |
| Net income (loss) (Continuing Operations) | $2,956 | $(15,353) | $(83,406) | $(95,802) | $10,469 | $(6,881) | $(62,509) | $(58,921) | $335 | $7,133 | $(30,701) | $(23,232) |
| Adjustments: | ||||||||||||
| Add: Acquisition and integration related expenses | — | 375 | 9,106 | 9,481 | — | — | 27,388 | 27,388 | — | — | 567 | 567 |
| Add: Intangible amortization | — | 38,044 | — | 38,044 | — | 17,602 | — | 17,602 | — | 4,152 | — | 4,152 |
| Add: Equity-based compensation expense | 447 | 368 | 11,494 | 12,309 | 414 | — | 8,941 | 9,355 | 634 | — | 11,632 | 12,266 |
| Add: Severance and restructuring expense | — | 60 | 23,065 | 23,125 | — | 248 | 7,352 | 7,600 | — | — | — | — |
| Add: Other non-operating (income) losses (1) | — | (591) | 5,108 | 4,517 | (7,500) | — | 2,318 | (5,182) | — | — | 279 | 279 |
| Adjusted net income (loss) before tax and NCI | 3,403 | 22,903 | (34,633) | (8,328) | 3,383 | 10,969 | (16,510) | (2,158) | 969 | 11,285 | (18,223) | (5,968) |
| Income tax effects | (58) | (6,009) | 58 | (6,009) | — | — | — | — | — | — | — | — |
| Adjusted net income (loss) before NCI | 3,345 | 16,894 | (34,575) | (14,337) | 3,383 | 10,969 | (16,510) | (2,158) | 969 | 11,285 | (18,223) | (5,968) |
| Net (income) loss attributable to NCI | — | (13,394) | — | (13,394) | — | (6,448) | — | (6,448) | — | (2,102) | — | (2,102) |
| Adjusted net income (loss) attributable to shareholders | $3,345 | $3,500 | $(34,575) | $(27,731) | $3,383 | $4,521 | $(16,510) | $(8,606) | $969 | $9,183 | $(18,223) | $(8,070) |
(1) Other non-operating expense includes one-time add-backs related to gain on sale of CNIC, partially offset by losses related to minority interest strategy and write-down of certain capitalized software. costs.
| Year Ended December 31, | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2025 | 2024 | 2023 | ||||||||||
| Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | Specialty Property & Casualty Insurance | Insurance Distribution | Corporate & Other | Consoli-dated | |
| Net income (loss) margin | 3.3% | (9.4)% | NM | (38.1)% | 8.3% | (6.9)% | NM | (25.0)% | 0.5% | 13.8% | NM | (18.6)% |
| Adjusted net income (loss) margin | 3.8% | 14.0% | NM | (3.3)% | 2.7% | 11.1% | NM | (0.9)% | 1.5% | 21.9% | NM | (4.8)% |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.