8-K
false000007928200000792822024-03-012024-03-01

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 1, 2024

BROWN & BROWN, INC.

(Exact name of registrant as specified in its charter)

 

Florida

001-13619

59-0864469

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

300 North Beach Street, Daytona Beach, Florida 32114

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (386) 252-9601

N/A

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, $0.10 Par Value

BRO

New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 


Item 2.02 Results of Operations and Financial Condition.

Item 7.01 Regulation FD Disclosure.

The information contained in this Current Report on Form 8-K, including the accompanying Exhibit 99.1, is being furnished pursuant to Item 2.02 and 7.01 of Form 8-K and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section. The information contained in this Current Report on Form 8-K that is furnished under this Item 2.02 and 7.01, including the accompanying Exhibit 99.1, shall not be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such a filing.

Segment Reorganization

On January 22, 2024, Brown & Brown, Inc. (the “Company”) issued a press release announcing that in conjunction with the divestiture of certain businesses within the Company’s Services segment in the fourth quarter of 2023, it had aligned its business from four to three segments beginning in 2024. As a result of the segment reorganization, the Services segment was eliminated as a business segment. Effective for fiscal year 2024, which began January 1, 2024, the Company will report its financial results in the following three reportable segments: Retail, Programs and Wholesale Brokerage.

The Company’s new business segment structure reflects that the ongoing operations that had been part of the Services segment were integrated into the operation and management of the Retail segments, where the services provided more closely align with the services in Retail than they do with the Company’s other ongoing segments. The historical results for the businesses that were sold were combined with the Programs segment as they either derived a certain portion of their business from activities associated with managing general underwriter (MGU) programs in this segment or have similar customers to other businesses in the Programs segment.

Supplemental Information

The Company is providing Exhibit 99.1 to this Current Report on Form 8-K, as supplemental information, unaudited historical business segment information for each quarter of the Company’s fiscal year 2023 and for each of the full years from 2019 -2023, as recast to reflect the new business segment structure. Exhibit 99.1 is furnished herewith and is incorporated herein by reference. The segment reorganization has no impact to the Company’s previously reported consolidated statements of income, balance sheets, statements of cash flows, statements of comprehensive income or statements of shareholders’ equity. The Company did not operate under the realigned segment structure for any of these prior periods. The information in this Current Report on Form 8-K, including Exhibit 99.1, should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and the Company’s Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2023, June 30, 2023 and September 30, 2023, which reports have previously been filed with the Securities and Exchange Commission.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

The following exhibit is furnished herewith:

 

Exhibit No.

 

Description

 

 

 

99.1

 

Brown & Brown, Inc. Historical Business Segment Information as Reclassified for Segment Changes.

 

 

 

104

 

Cover Page Interactive Data File (formatted as inline XBRL).

 


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: March 1, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BROWN & BROWN, INC.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Registrant)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Anthony M. Robinson

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Anthony M. Robinson

Secretary

 


EX-99.1

 

Exhibit 99.1

BROWN & BROWN, INC.

HISTORICAL BUSINESS SEGMENT INFORMATION

AS RECLASSIFIED FOR SEGMENT CHANGES

(Unaudited)

The following tables set forth Brown & Brown, Inc. historical business segment financial information as reclassified for segment changes for the twelve months ended December 31, 2023, 2022, 2021, 2020 and 2019 (unaudited).

 

 

Retail

 

 

Programs

 

 

Twelve months ended December 31,

 

 

Twelve months ended December 31,

 

(in millions)

2019

 

2020

 

2021

 

2022

 

2023

 

 

2019

 

2020

 

2021

 

2022

 

2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

1,457

 

$

1,549

 

$

1,840

 

$

2,154

 

$

2,503

 

 

$

620

 

$

707

 

$

807

 

$

957

 

$

1,160

 

Investment income

 

 

 

 

 

 

 

 

 

1

 

 

 

2

 

 

1

 

 

1

 

 

1

 

 

12

 

Other income, net

 

1

 

 

1

 

 

1

 

 

3

 

 

4

 

 

 

 

 

 

 

 

 

 

 

1

 

Total revenues

 

1,458

 

 

1,550

 

 

1,841

 

 

2,157

 

 

2,508

 

 

 

622

 

 

708

 

 

808

 

 

958

 

 

1,173

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

799

 

 

856

 

 

982

 

 

1,126

 

 

1,336

 

 

 

274

 

 

313

 

 

352

 

 

376

 

 

425

 

Other operating expenses

 

257

 

 

245

 

 

290

 

 

377

 

 

421

 

 

 

135

 

 

147

 

 

158

 

 

223

 

 

247

 

(Gain)/loss on disposal

 

(10

)

 

(2

)

 

(6

)

 

(8

)

 

(3

)

 

 

 

 

 

 

(4

)

 

1

 

 

(141

)

Amortization

 

67

 

 

72

 

 

82

 

 

101

 

 

112

 

 

 

27

 

 

28

 

 

29

 

 

37

 

 

42

 

Depreciation

 

8

 

 

10

 

 

12

 

 

14

 

 

19

 

 

 

7

 

 

9

 

 

11

 

 

16

 

 

13

 

Interest

 

91

 

 

90

 

 

94

 

 

96

 

 

85

 

 

 

17

 

 

21

 

 

11

 

 

33

 

 

36

 

Change in estimated acquisition earn-out payables

 

 

 

6

 

 

42

 

 

(26

)

 

1

 

 

 

(1

)

 

(11

)

 

(8

)

 

(11

)

 

 

Total expenses

 

1,212

 

 

1,277

 

 

1,496

 

 

1,680

 

 

1,971

 

 

 

459

 

 

507

 

 

549

 

 

675

 

 

622

 

Income before income taxes

$

246

 

$

273

 

$

345

 

$

477

 

$

537

 

 

$

163

 

$

201

 

$

259

 

$

283

 

$

551

 

 

 

 

Wholesale Brokerage

 

 

Other

 

 

Twelve months ended December 31,

 

 

Twelve months ended December 31,

 

(in millions)

2019

 

2020

 

2021

 

2022

 

2023

 

 

2019

 

2020

 

2021

 

2022

 

2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

309

 

$

352

 

$

403

 

$

453

 

$

539

 

 

$

(1

)

$

(2

)

$

(2

)

$

(1

)

$

(3

)

Investment income

 

 

 

 

 

 

 

 

 

2

 

 

 

4

 

 

2

 

 

 

 

6

 

 

37

 

Other income, net

 

1

 

 

1

 

 

 

 

 

 

 

 

 

 

 

2

 

 

1

 

 

 

 

1

 

Total revenues

 

310

 

 

353

 

 

403

 

 

453

 

 

541

 

 

 

3

 

 

2

 

 

(1

)

 

5

 

 

35

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

158

 

 

184

 

 

213

 

 

239

 

 

284

 

 

 

77

 

 

83

 

 

90

 

 

76

 

 

142

 

Other operating expenses

 

52

 

 

54

 

 

61

 

 

70

 

 

85

 

 

 

(67

)

 

(80

)

 

(106

)

 

(73

)

 

(103

)

(Gain)/loss on disposal

 

 

 

 

 

 

 

3

 

 

 

 

 

 

 

 

 

 

 

(1

)

 

1

 

Amortization

 

11

 

 

9

 

 

9

 

 

9

 

 

11

 

 

 

 

 

 

 

 

 

 

 

1

 

Depreciation

 

1

 

 

2

 

 

3

 

 

3

 

 

3

 

 

 

7

 

 

5

 

 

7

 

 

6

 

 

5

 

Interest

 

5

 

 

10

 

 

16

 

 

13

 

 

12

 

 

 

(49

)

 

(62

)

 

(56

)

 

(1

)

 

57

 

Change in estimated acquisition earn-out payables

 

 

 

 

 

6

 

 

(2

)

 

20

 

 

 

 

 

 

 

 

 

 

 

 

Total expenses

 

227

 

 

259

 

 

308

 

 

335

 

 

415

 

 

 

(32

)

 

(54

)

 

(65

)

 

7

 

 

103

 

Income before income taxes

$

83

 

$

94

 

$

95

 

$

118

 

$

126

 

 

$

35

 

$

56

 

$

64

 

$

(2

)

$

(68

)

 

1


 

 

 

 

Total

 

 

Twelve months ended December 31,

 

(in millions)

2019

 

2020

 

2021

 

2022

 

2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

2,385

 

$

2,606

 

$

3,048

 

$

3,563

 

$

4,199

 

Investment income

 

6

 

 

3

 

 

1

 

 

7

 

 

52

 

Other income, net

 

2

 

 

4

 

 

2

 

 

3

 

 

6

 

Total revenues

 

2,393

 

 

2,613

 

 

3,051

 

 

3,573

 

 

4,257

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

1,308

 

 

1,436

 

 

1,637

 

 

1,817

 

 

2,187

 

Other operating expenses

 

377

 

 

366

 

 

403

 

 

597

 

 

650

 

(Gain)/loss on disposal

 

(10

)

 

(2

)

 

(10

)

 

(5

)

 

(143

)

Amortization

 

105

 

 

109

 

 

120

 

 

147

 

 

166

 

Depreciation

 

23

 

 

26

 

 

33

 

 

39

 

 

40

 

Interest

 

64

 

 

59

 

 

65

 

 

141

 

 

190

 

Change in estimated acquisition earn-out payables

 

(1

)

 

(5

)

 

40

 

 

(39

)

 

21

 

Total expenses

 

1,866

 

 

1,989

 

 

2,288

 

 

2,697

 

 

3,111

 

Income before income taxes

$

527

 

$

624

 

$

763

 

$

876

 

$

1,146

 

The following tables set forth Brown & Brown, Inc. historical business segment financial information as reclassified for segment changes for the three months ended March 31, June 30, September 30, December 31, 2023 and for the year ended December 31, 2023 (unaudited).

 

 

Retail

 

 

Three months ended

 

 

Twelve months ended

 

(in millions)

March 31,
2023

 

June 30,
2023

 

September 30,
2023

 

December 31,
2023

 

 

December 31,
2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

732

 

$

590

 

$

600

 

$

581

 

 

$

2,503

 

Investment income

 

 

 

 

 

 

 

1

 

 

 

1

 

Other income, net

 

1

 

 

1

 

 

2

 

 

 

 

 

4

 

Total revenues

 

733

 

 

591

 

 

602

 

 

582

 

 

 

2,508

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

363

 

 

323

 

 

331

 

 

319

 

 

 

1,336

 

Other operating expenses

 

104

 

 

105

 

 

102

 

 

110

 

 

 

421

 

(Gain)/loss on disposal

 

 

 

 

 

(3

)

 

 

 

 

(3

)

Amortization

 

28

 

 

28

 

 

28

 

 

28

 

 

 

112

 

Depreciation

 

5

 

 

5

 

 

5

 

 

4

 

 

 

19

 

Interest

 

22

 

 

22

 

 

22

 

 

19

 

 

 

85

 

Change in estimated acquisition earn-out payables

 

(3

)

 

2

 

 

5

 

 

(3

)

 

 

1

 

Total expenses

 

519

 

 

485

 

 

490

 

 

477

 

 

 

1,971

 

Income before income taxes

$

214

 

$

106

 

$

112

 

$

105

 

 

$

537

 

 

2


 

 

Programs

 

 

Three months ended

 

 

Twelve months ended

 

(in millions)

March 31,
2023

 

June 30,
2023

 

September 30,
2023

 

December 31,
2023

 

 

December 31,
2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

254

 

$

308

 

$

301

 

$

297

 

 

$

1,160

 

Investment income

 

1

 

 

2

 

 

4

 

 

5

 

 

 

12

 

Other income, net

 

 

 

 

 

 

 

1

 

 

 

1

 

Total revenues

 

255

 

 

310

 

 

305

 

 

303

 

 

 

1,173

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

103

 

 

101

 

 

106

 

 

115

 

 

 

425

 

Other operating expenses

 

59

 

 

62

 

 

63

 

 

63

 

 

 

247

 

(Gain)/loss on disposal

 

(6

)

 

 

 

 

 

(135

)

 

 

(141

)

Amortization

 

11

 

 

11

 

 

10

 

 

10

 

 

 

42

 

Depreciation

 

3

 

 

3

 

 

3

 

 

4

 

 

 

13

 

Interest

 

10

 

 

9

 

 

8

 

 

9

 

 

 

36

 

Change in estimated acquisition earn-out payables

 

 

 

 

 

 

 

 

 

 

 

Total expenses

 

180

 

 

186

 

 

190

 

 

66

 

 

 

622

 

Income before income taxes

$

75

 

$

124

 

$

115

 

$

237

 

 

$

551

 

 

 

 

Wholesale Brokerage

 

 

Three months ended

 

 

Twelve months ended

 

(in millions)

March 31,
2023

 

June 30,
2023

 

September 30,
2023

 

December 31,
2023

 

 

December 31,
2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

123

 

$

139

 

$

149

 

$

128

 

 

$

539

 

Investment income

 

 

 

 

 

1

 

 

1

 

 

 

2

 

Other income, net

 

 

 

 

 

 

 

 

 

 

 

Total revenues

 

123

 

 

139

 

 

150

 

 

129

 

 

 

541

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

67

 

 

72

 

 

73

 

 

72

 

 

 

284

 

Other operating expenses

 

18

 

 

24

 

 

21

 

 

22

 

 

 

85

 

(Gain)/loss on disposal

 

 

 

 

 

 

 

 

 

 

 

Amortization

 

3

 

 

3

 

 

3

 

 

2

 

 

 

11

 

Depreciation

 

1

 

 

1

 

 

1

 

 

 

 

 

3

 

Interest

 

3

 

 

3

 

 

3

 

 

3

 

 

 

12

 

Change in estimated acquisition earn-out payables

 

 

 

(2

)

 

25

 

 

(3

)

 

 

20

 

Total expenses

 

92

 

 

101

 

 

126

 

 

96

 

 

 

415

 

Income before income taxes

$

31

 

$

38

 

$

24

 

$

33

 

 

$

126

 

 

 

3


 

 

Other

 

 

Three months ended

 

 

Twelve months ended

 

(in millions)

March 31,
2023

 

June 30,
2023

 

September 30,
2023

 

December 31,
2023

 

 

December 31,
2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

(1

)

$

(1

)

$

(1

)

$

 

 

$

(3

)

Investment income

 

6

 

 

8

 

 

12

 

 

11

 

 

 

37

 

Other income, net

 

 

 

 

 

 

 

1

 

 

 

1

 

Total revenues

 

5

 

 

7

 

 

11

 

 

12

 

 

 

35

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

38

 

 

34

 

 

22

 

 

48

 

 

 

142

 

Other operating expenses

 

(20

)

 

(29

)

 

(18

)

 

(36

)

 

 

(103

)

(Gain)/loss on disposal

 

 

 

 

 

 

 

1

 

 

 

1

 

Amortization

 

(1

)

 

(1

)

 

 

 

3

 

 

 

1

 

Depreciation

 

1

 

 

1

 

 

1

 

 

2

 

 

 

5

 

Interest

 

12

 

 

14

 

 

15

 

 

16

 

 

 

57

 

Change in estimated acquisition earn-out payables

 

1

 

 

2

 

 

 

 

(3

)

 

 

 

Total expenses

 

31

 

 

21

 

 

20

 

 

31

 

 

 

103

 

Income before income taxes

$

(26

)

$

(14

)

$

(9

)

$

(19

)

 

$

(68

)

 

 

 

Total

 

 

Three months ended

 

 

Twelve months ended

 

(in millions)

March 31,
2023

 

June 30,
2023

 

September 30,
2023

 

December 31,
2023

 

 

December 31,
2023

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

Commissions and fees

$

1,108

 

$

1,036

 

$

1,049

 

$

1,006

 

 

$

4,199

 

Investment income

 

7

 

 

10

 

 

17

 

 

18

 

 

 

52

 

Other income, net

 

1

 

 

1

 

 

2

 

 

2

 

 

 

6

 

Total revenues

 

1,116

 

 

1,047

 

 

1,068

 

 

1,026

 

 

 

4,257

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

571

 

 

530

 

 

532

 

 

554

 

 

 

2,187

 

Other operating expenses

 

161

 

 

162

 

 

168

 

 

159

 

 

 

650

 

(Gain)/loss on disposal

 

(6

)

 

 

 

(3

)

 

(134

)

 

 

(143

)

Amortization

 

41

 

 

41

 

 

41

 

 

43

 

 

 

166

 

Depreciation

 

10

 

 

10

 

 

10

 

 

10

 

 

 

40

 

Interest

 

47

 

 

48

 

 

48

 

 

47

 

 

 

190

 

Change in estimated acquisition earn-out payables

 

(2

)

 

2

 

 

30

 

 

(9

)

 

 

21

 

Total expenses

 

822

 

 

793

 

 

826

 

 

670

 

 

 

3,111

 

Income before income taxes

$

294

 

$

254

 

$

242

 

$

356

 

 

$

1,146

 

 

4