OCTAVE SPECIALTY GROUP INC

For the period ended Jun 30, 2026. Filed Aug 6, 2026.

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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Jun 30, 2026 · Filed Aug 6, 2026

OSG$5.27+5.6%Stored close · as of Nov 9, 2026

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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 because they are not calculated in accordance with GAAP.

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.

The following paragraphs define each non-GAAP financial measure. A tabular reconciliation of the non-GAAP financial measure to 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.

EBITDA Margin —EBITDA divided by total revenues.

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 capital raising. 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.

Octave Specialty Group, Inc.	39	Second Quarter 2026 Form 10-Q

	Three Months Ended June 30, 2026					Three Months Ended June 30, 2025
	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total
Net income (loss) (Continuing Operations)	$1,119	$(1,325)	$(11,637)	$(313)	$(12,156)	$428	$(7,992)	$(13,240)	$—	$(20,802)
Adjustments:
Add: Interest expense	—	2,774	—	—	2,774	—	5,570	—	—	5,570
Add: Income tax expense (benefit)	125	479	(119)	—	485	192	(2,181)	(183)	—	(2,172)
Add: Depreciation expense	—	350	305	—	655	—	—	440	—	440
Add: Intangible amortization expense	—	11,609	—	—	11,609	—	9,301	—	—	9,301
EBITDA	1,244	13,887	(11,451)	(313)	3,367	620	4,698	(12,983)	—	(7,663)
Add: Impact of noncontrolling interests	—	(5,217)	—	113	(5,104)	—	(2,185)	—	—	(2,185)
EBITDA attributable to shareholders	1,244	8,670	(11,451)	(200)	(1,737)	620	2,513	(12,983)	—	(9,848)
Net income margin	4.2%	(2.3)%	NM	NM	(14.6)%	2.0%	(24.2)%	NM	NM	(37.9)%
Net income margin to shareholders	4.2%	(6.4)%	NM	NM	(17.4)%	2.0%	(23.4)%	NM	NM	(37.4)%
EBITDA margin	4.7%	23.8%	NM	NM	4.1%	2.9%	14.2%	NM	NM	(13.9)%
EBITDA margin to shareholders	4.7%	14.8%	NM	NM	(2.1)%	2.9%	7.6%	NM	NM	(17.9)%
Add: Acquisition and integration-related expenses	—	451	688	—	1,139	—	375	399	—	774
Add: Equity-based compensation expense	372	991	2,650	—	4,013	61	67	1,895	—	2,023
Add: Severance and restructuring expense	141	—	449	—	590	—	31	2,918	—	2,949
Add: Other non-operating (income) losses	—	—	—	—	—	—	(591)	—	—	(591)
Adjusted EBITDA	$1,757	$15,329	$(7,664)	$(313)	$9,109	$681	$4,580	$(7,771)	$—	$(2,508)
Impact of noncontrolling interest	—	(5,537)	—	113	(5,424)	—	(2,061)	—	—	(2,061)
Adjusted EBITDA to shareholders	$1,757	$9,792	$(7,664)	$(200)	$3,685	$681	$2,519	$(7,771)	$—	$(4,569)
Adjusted EBITDA to shareholders per diluted share	$0.04	$0.22	$(0.17)	$—	$0.08	$0.01	$0.05	$(0.16)	$—	$(0.09)
Adjusted EBITDA margin	6.7%	26.2%	NM	NM	11.0%	3.2%	13.9%	NM	NM	(4.6)%
Adjusted EBITDA margin to shareholders	6.7%	16.8%	NM	NM	4.4%	3.2%	7.6%	NM	NM	(8.3)%

Octave Specialty Group, Inc.	40	Second Quarter 2026 Form 10-Q

Six Months Ended June 30, 2026 · Six Months Ended June 30, 2025
Specialty Property & Casualty Insurance · Insurance Distribution · Corporate & Other · Eliminations · Total · Specialty Property & Casualty Insurance · Insurance Distribution · Corporate & Other · Eliminations · Total
Net income (loss) (Continuing Operations)	$(6,571)	$15,828	$(23,963)		$(313)		$(15,019)		$1,852		$(9,735)		$(27,410)		$—		$(35,292)
Adjustments:
Add: Interest expense	—	4,864	—		—		4,864		—		11,024		—		—		11,024
Add: Income tax expense (benefit)	(467)	111	360		—		4		270		(2,681)		(378)		—		(2,789)
Add: Depreciation expense	—	645	577		—		1,222		—		109		744		—		853
Add: Intangible amortization expense	—	23,256	—		—		23,256		—		18,064		—		—		18,064
EBITDA	(7,038)	44,704	(23,026)		(313)		14,327		2,122		16,781		(27,044)		—		(8,140)
Add: Impact of noncontrolling interests	—	(12,567)	—		113		(12,454)		—		(7,205)		—			(7,205)
EBITDA attributable to shareholders	(7,038)	32,137	(23,026)		(200)		1,873		2,122		9,576		(27,044)		—		(15,345)
Net income margin	(12.7)%	11.6%	NM	NM		(8.0)%		4.4%		(13.1)%		NM	NM	(30.0)%
Net income margin to shareholders	(12.7)%	6.9%	NM	NM		(11.4)%		4.4%		(15.0)%		NM	NM	(31.2)%
EBITDA margin	(13.6)%	32.6%	NM	NM		7.7%		5.0%		22.7%		NM	NM	(6.9)%
EBITDA margin to shareholders	(13.6)%	23.5%	NM	NM		1.0%		5.0%		12.9%		NM	NM	(13.0)%
Add: Acquisition and integration-related expenses	—	1,855	1,752		—		3,607		—		375		1,081		—		1,456
Add: Equity-based compensation expense	1,069	1,765	5,771		—		8,605		147		67		3,469		—		3,683
Add: Severance and restructuring expense	1,432	—	868		—		2,300		—		60		4,737		—		4,797
Add: Other non-operating (income) losses	7,912	—	82		—		7,994		—		(591)		—		—		(591)
Adjusted EBITDA	$3,375	$48,324	$(14,553)		$(313)		$36,833		$2,270		$16,692		$(17,759)		$—		$1,205
Impact of noncontrolling interest	—	(13,192)	—		113		(13,079)		—		(7,081)		—		—		(7,081)
Adjusted EBITDA to shareholders	$3,375	$35,132	$(14,553)		$(200)		$23,754		$2,270		$9,611		$(17,759)		$—		$(5,876)
Adjusted EBITDA to shareholders per diluted share	$0.07	$0.77	$(0.32)		$—		$0.52		$0.04		$0.20		$(0.37)		$—		$(0.12)
Adjusted EBITDA margin	6.5%	35.3%	NM	NM		19.7%		5.3%		22.5%		NM	NM	1.0%
Adjusted EBITDA margin to shareholders	6.5%	25.7%	NM	NM		12.7%		5.3%		13.0%		NM	NM	(5.0)%

Organic Revenue Growth & Rate (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):

Three Months Ended June 30,	2026	2025	% Growth
Total Insurance Distribution revenue & growth percentage (1)	$58,418	$33,041	76.8%
Less: Acquired revenues	(7,289)	—
Less: Profit commission and contingent commission income	(5,620)	(2,266)
Less: Other conforming adjustments	—	(2,074)
Less: impact of F.X. rates	(445)	2,564
Total Organic Revenue & Growth Percentage	$45,064	$31,265	44.1%

Octave Specialty Group, Inc.	41	Second Quarter 2026 Form 10-Q

Six months ended June 30,	2026	2025	% Growth
Total Insurance Distribution revenue & growth percentage (1)	$136,944	$74,039	85.0%
Less: Acquired revenues	(28,410)	—
Less: Profit commission and contingent commission income	(11,808)	(6,957)
Less: Other conforming adjustments	—	(4,307)
Less: impact of F.X. rates	(1,722)	3,710
Total Organic Revenue & Growth Percentage	$95,004	$66,485	42.9%

(1)Total Insurance Distribution revenue includes investment income.

Adjusted Net Income and Adjusted Net Income Margin — We define Adjusted Net Income as net income (loss) from continuing operations attributable to shareholders 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.

	Three Months Ended June 30,
	2026					2025
	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total
Net income (loss) (Continuing Operations)	$1,119	$(1,325)	$(11,637)	$(313)	$(12,156)	$428	$(7,992)	$(13,240)	$—	$(20,802)
Adjustments:
Add: Acquisition and integration-related expenses	—	451	688	—	1,139	—	375	399	—	774
Add: Intangible amortization expense	—	11,609	—	—	11,609	—	9,301	—	—	9,301
Add: Equity-based compensation expense	372	991	2,650	—	4,013	61	67	1,895	—	2,023
Add: Severance and restructuring expense	141	—	449	—	590	—	31	2,918	—	2,949
Add: Other non-operating (income) losses	—	—	—	—	—	—	(591)	—	—	(591)
Adjusted net income (loss) before tax adjustments and NCI	1,632	11,726	(7,850)	(313)	5,195	489	1,191	(8,028)	—	(6,348)
Income tax effects	(1,132)	(2,307)	1,132	—	(2,307)	(15)	(1,892)	15	—	(1,892)
Adjusted net income (loss) before NCI	500	9,419	(6,718)	(313)	2,888	474	(701)	(8,013)	—	(8,240)
Net (income) loss attributable to NCI	—	(4,814)	—	113	(4,701)	—	(2,312)	—	—	(2,312)
Adjusted net income (loss) to shareholders	500	4,605	(6,718)	(200)	(1,813)	474	(3,013)	(8,013)	—	(10,552)
Net income (loss) margin	4.2%	(2.3)%	NM	NM	(14.6)%	2.0%	(24.2)%	NM	NM	(37.9)%
Adjusted Net income (loss) attributable to stockholders margin	1.9%	7.9%	NM	NM	(2.2)%	2.2%	(9.1)%	NM	NM	(19.2)%

Octave Specialty Group, Inc.	42	Second Quarter 2026 Form 10-Q

	Six Months Ended June 30,
	2026					2025
	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total	Specialty Property & Casualty Insurance	Insurance Distribution	Corporate & Other	Eliminations	Total
Net income (loss) (Continuing Operations)	$(6,571)	$15,828	$(23,963)	$(313)	$(15,019)	$1,852	$(9,735)	$(27,410)	$—	$(35,292)
Adjustments:
Add: Acquisition and integration-related expenses	—	1,855	1,752	—	3,607	—	375	1,081	—	1,456
Add: Intangible amortization expense	—	23,256	—	—	23,256	—	18,064	—	—	18,064
Add: Equity-based compensation expense	1,069	1,765	5,771	—	8,605	147	67	3,469	—	3,683
Add: Severance and restructuring expense	1,432	—	868	—	2,300	—	60	4,737	—	4,797
Add: Other non-operating (income) losses	7,912	—	82	—	7,994	—	(591)	—	—	(591)
Adjusted net income (loss) before tax adjustments and NCI	3,842	42,704	(15,490)	(313)	30,743	2,000	8,240	(18,123)	—	(7,883)
Income tax effects	(2,187)	(4,536)	2,187	—	(4,536)	(15)	(1,892)	15	—	(1,892)
Adjusted net income (loss) before NCI	1,655	38,168	(13,303)	(313)	26,207	1,985	6,348	(18,108)	—	(9,775)
Net (income) loss attributable to noncontrolling interest	—	(11,518)	—	113	(11,405)	—	(6,812)	—	—	(6,812)
Adjusted net income (loss) attributable to shareholders	$1,655	$26,650	$(13,303)	$(200)	$14,802	$1,985	$(464)	$(18,108)	$—	$(16,587)
Net income (loss) margin	(12.7)%	11.6%	NM	NM	(8.0)%	4.4%	(13.1)%	NM	NM	(30.0)%
Adjusted Net income (loss) attributable to stockholders margin	3.2%	19.5%	NM	NM	7.9%	4.7%	(0.6)%	NM	NM	(14.1)%

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