2019 Best Practices Study

AGENCIES WITH REVENUES OF:

AVERAGE

<$1.25M $1.25-$2.5M $2.5-$5M $5-$10M $10-$25M >$25M

Current Ratio

2.10:1 2.37:1 11.4% 33.1% 13.0% 52.4% 20.8% 76.5%

1.82:1 2.05:1

2.00:1 2.27:1 13.6% 46.6% 14.4% 13.4% 33.0% 64.7%

1.82:1 2.21:1 11.3% 45.6%

1.57:1 2.29:1 10.7% 43.7% 19.4% 15.1% 38.1% 59.6%

1.51:1 1.81:1

Trust Ratio

Tangible Net Worth (% of Net Rev) Receivables-to-Payables Ratio Accounts Receivables: % Receivables Aged 61-90 Days

9.0%

9.4%

35.9%

46.4%

24.3% 22.3% 19.0% 78.5%

10.4%

6.3% 5.5%

% Receivables Aged Past 90 Days

8.1%

% of P&C Revenues - Agency Billed % of P&C Revenues - Direct Billed

28.6% 69.2%

47.0% 50.7%

AGENCIES WITH REVENUES OF:

TOP QUARTILE

<$1.25M $1.25-$2.5M $2.5-$5M $5-$10M $10-$25M >$25M

Current Ratio

4.07:1 4.34:1 31.0%

3.54:1 3.94:1 24.6% -7.3%

3.76:1 4.07:1 30.8%

2.91:1 3.67:1 26.9%

2.69:1 4.04:1 26.1% 14.2%

2.44:1 3.11:1 24.1% 16.4%

Trust Ratio

Tangible Net Worth (% of Net Rev) Receivables-to-Payables Ratio Accounts Receivables: % Receivables Aged 61-90 Days

4.7%

1.5%

6.8%

-38.1%

-6.2% -9.0%

-15.4%

-11.2% 30.6%

-1.7%

-5.5% -3.4%

% Receivables Aged Past 90 Days

0.4%

-6.2%

-14.8%

AGENCIES WITH REVENUES OF:

AVERAGE

<$1.25M $1.25-$2.5M $2.5-$5M $5-$10M $10-$25M >$25M

Debt Metrics: % of All Loans by Source Type: Community Bank

51.6%

66.7% 11.9%

45.5%

58.0%

43.9%

45.7%

Industry Lender

9.7%

9.1% 1.8%

6.0% 0.0%

4.1% 0.0%

4.3% 0.0%

Private Equity Lender

16.1%

2.4% 7.1%

Shareholder

9.7%

14.5% 29.1%

16.0% 20.0%

35.7% 16.3%

19.6% 30.4%

Other

12.9%

11.9%

% of Firms that have Identified Debt

40.7%

41.4%

37.3%

51.2%

62.7%

60.7%

Of those firms that have debt: Average Total Debt

$281,325

$373,583 $1,395,181 $1,418,163 $4,131,024 $14,088,334

Total Leverage 1

1.0x 5.2%

2.1x 4.4%

2.1x 4.2%

0.9x 4.2%

1.2x 4.3%

1.1x 4.6%

Average Effective Interest Rate Average Term (Years to Maturity)

4.1

4.5

5.0

5.0

5.5

5.0

1 Total Debt / Pro Forma EBITDA

 67