Title

Presentation

The Baldwin Insurance Group, Inc. misses on earnings expectations. Reported EPS is $0.63 EPS, expectations were $0.64.

Operator: Greetings, and welcome to The Baldwin Insurance Group, Inc. First Quarter 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press 0 on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Bonnie Bishop, Executive Director, Investor Relations. Thank you, Ms. Bishop. You may begin.

Bonnie Bishop: Thank you. Welcome to The Baldwin Insurance Group, Inc. First Quarter 2026 Earnings Call. Today’s call is being recorded. First quarter financial results, supplemental information, and the company’s Form 10-Q were issued earlier this afternoon and are available on the company’s website at ir.baldwin.com. Please note that remarks made today may include forward-looking statements subject to various assumptions, risks, and uncertainties, including, for example, our strategy with respect to our capital allocation in the future. The company’s actual results may differ materially from those contemplated by such statements. For a more detailed discussion, please refer to the note regarding forward-looking statements in the company’s earnings release and our most recent Form 10-Q, both of which are available on The Baldwin Insurance Group, Inc.

website. During the call today, the company may also discuss certain non-GAAP financial measures. For a more detailed discussion of these non-GAAP financial measures and historical reconciliation to the most closely comparable GAAP measures, please refer to the company’s earnings release and supplemental information, both of which have been posted on the company’s website at ir.baldwin.com. I will now turn the call over to Trevor Baldwin, Chief Executive Officer of The Baldwin Insurance Group, Inc.

Trevor Baldwin: Good afternoon, and thank you for joining us to discuss our first quarter results reported earlier today. I am joined by Bradford Lenzie Hale, Chief Financial Officer, and Bonnie Bishop, Executive Director of Investor Relations. We had a solid start to the year on the heels of closing our partnerships with CAC, Ovi, and Capstone in January. We delivered total revenue of $532 million, adjusted EBITDA of $137 million, adjusted EBITDA margin of 26%, and adjusted diluted earnings per share of $0.63. Overall, commission and fee organic revenue growth was 3%, and total organic revenue growth was 2%. Adjusting for the impact of the QBE builder book transition, which we lapped on May 1, continued softness in our Medicare business due to disruption in the Medicare marketplace, and the procedural change impacting the timing of revenue recognition in IAS, overall organic revenue growth would have been 5%.

Layering in the impact of the March partnerships as if they had been owned by The Baldwin Insurance Group, Inc. in both comparable periods, overall organic revenue growth would have been 9%. Collectively, those three partnerships grew 27% over 2025—a remarkable start to the year. In Insurance Advisory Solutions, overall organic revenue growth was 4%, driven by sales velocity of 13% before layering in the results from CAC and Capstone, which compares to 14% in the prior year period. As a reminder, sales velocity is seasonally lowest in the first quarter as a result of a bulk of our employee benefits renewals booking on 1/1. The impact of rate and exposure in the quarter was a 70 basis point headwind. Including both CAC and Capstone as if those businesses had been owned in the prior year period, organic growth would have been 10%.

Combined sales velocity, including the acquired businesses, was 24%. We are incredibly enthused by the early contributions from CAC and Capstone, which delivered the strongest quarterly results in each of their respective histories. CAC generated new business of $38 million in the first quarter, up 39% compared to the same period in the prior year, and total revenue was $92 million, representing growth of 27% in relation to 2025. CAC sales velocity in the quarter was 61% across all product lines, and 15% for recurring lines of business. Net growth of transaction-related product lines, which consist primarily of our transaction liability and certain project-specific construction lines of business, was 22%. Going forward, we will report sales velocity on an aggregate basis, as well as broken out for recurring lines of business.

Separately, we will call out net growth in transaction-related product lines. These transaction-related product lines have some variability quarter to quarter due to the variable nature and timing of transactions and project starts. CAC’s strong growth in the quarter was driven by strong new business across key specialty industry groups, strength in the private equity and transaction liability practices, which supported several marquee transactions at the nexus of the AI infrastructure buildout across the U.S. and globally, as well as strong momentum from cross-sell opportunities between the legacy The Baldwin Insurance Group, Inc. and CAC teams. Our integration work is running ahead of schedule. Today, over $34 million in cost synergies have been actioned, representing nearly 80% of the three-year $43 million target we laid out on our last call.

We expect these to materialize in the P&L throughout the balance of this year and in 2027. On the revenue side, in the quarter we realized $1 million of revenue synergies, and as of today that number has grown to nearly $3 million, with over $10 million in client cross-sell opportunities being actively worked. Four months in, we are tracking ahead of plan on every dimension of this powerful business combination, and the industrial logic we saw is pulling through more quickly and more significantly than we had anticipated. Moving to our Underwriting, Capacity and Technology Solutions segment, organic revenue growth was 3% in the quarter, with core commissions and fees growing by approximately 6%. Importantly, we recognized a large one-time contingent payment in our real estate investor program in 2025, normalizing for which UCTS’s organic growth would have been 9% for the quarter.

The underlying momentum across the segment remains strong. Our multifamily business grew revenue 10% in the quarter, and Juniper Re grew over 90%, both reflecting the durable scale advantages of our proprietary capacity strategy. We did continue to see pressure in our E&S homeowners book; revenue was down roughly 30% in the quarter as we deliberately maintain underwriting discipline in a soft property environment. The transition of our builder book from QBE to Brev, our inaugural reciprocal insurance exchange, remains on track. Brev is now licensed in seven states and positioned to begin migration of business outside Texas in the back half of the year. Our second proprietary builder program with Hippo and Spinnaker remains on track to launch later this year.

Over time, we expect this to materially increase our capture rate of Westwood’s builder business in new proprietary MSI programs from approximately 30% today—a meaningful multiyear growth opportunity for our MGA, and a meaningful expansion of vital insurance capacity for our builder partners and their homebuyer customers. Our Main Street Insurance Solutions segment organic revenue growth was down 5% in the quarter, driven primarily by continued year-over-year headwinds from the QBE commission rate reduction at Westwood and softness in our Medicare business. Normalizing for impacts of those two headwinds, overall organic revenue growth was 7%. We fully lapped the QBE impact on May 1 and expect organic growth in our MIS segment to begin ramping again from here.

We are also seeing growing momentum in our embedded mortgage businesses, which went live in April with Fairway Independent Mortgage, a top-10 independent mortgage originator in the country. While Fairway has only been live on the platform for one month, early signs are very encouraging. The 3B30 Catalyst program is now fully underway. In the first quarter, we executed the first phase of role transformation within IAS and remain on track to deliver $3 million to $5 million in in-year savings. You can find additional information in the 3B30 Catalyst slide in our earnings supplement. Now, let me address the question of AI directly, because it is increasingly central to how we are running this business and how I expect us to outperform over time.

We are leaning into AI with conviction. Over the past several quarters, we have been building our own proprietary AI orchestration layer that enables delivery of fully automated workflows. The early productivity gains from the tools we are deploying internally are running up to 80%. We are embedding AI directly into our operating platforms, including VIP, our proprietary operating system supporting the MGA, and we are using AI to elevate and enhance the work our colleagues do every day. Catalyst is the operational expression of this strategy—AI-enabled process redesign, bold transformation, and an accelerated path to operating leverage. Said simply, AI is a meaningful tailwind for our business, and we are investing aggressively to capture it.

On the question of disintermediation, our thesis is unchanged and the underlying structural advantages have only strengthened. First, the clients we serve—middle market, upper middle market, and large organizations—have complex, multi-location, multifaceted risks that require deep and specialty advisory solutions, human judgment, and a multitude of risk transfer counterparties and vehicles in order to thoughtfully and effectively manage and finance risk. The CAC combination further shifts our center of gravity upmarket away from the account segments most exposed to AI commoditization. Second, our embedded distribution strategy places insurance at the point of major life and business transactions and workflows consumers are unlikely to bypass for a standalone insurance buying experience.

Third, our UCTS business vertically integrates our platform across the entire value chain—owning the client relationship, advising on complex risk issues, building proprietary insurance products, and arranging the third-party risk capital that stands behind them. We are the disruptor in this marketplace. The combination of human expertise and judgment, embedded distribution, proprietary product and risk capital formation, and AI-driven productivity is the right architecture for the AI era. As we enter 2026, we are pleased with our first quarter results and confident in our positioning to accelerate performance ratably through the year and beyond. The underlying momentum across our segments is strong. The idiosyncratic headwinds we have discussed—the QBE commission change we have now lapped, the Medicare market disruption, and the IAS revenue recognition procedural change—will all be substantially behind us by the end of the second quarter.

CAC is exceeding our expectations on both revenue and expense synergy execution. The Catalyst program is delivering, and we are deploying AI across our platform with real and measurable productivity gains. Quite simply, our business was built for this era. We are leaning in to accelerate our impact and our results. I want to extend our gratitude to our clients for their continued trust in us to provide strategic guidance, expert insights, and innovative solutions, and I want to thank our nearly 5 thousand colleagues for their dedication to helping our clients protect what is possible. I will now turn the call over to Bradford Lenzie Hale, who will detail our financial results.

Bradford Lenzie Hale: Thanks, Trevor, and good afternoon, everyone. For the first quarter, we generated organic revenue growth of 2% and total revenue of $532.2 million. Looking at the segment level, organic revenue growth was up 4% in IAS, up 3% in UCTS, and down 5% in MIS. Adjusted for the three transitory items Trevor walked through, underlying organic revenue growth would have been 5%. We recorded GAAP net loss for the first quarter of $1.9 million, or GAAP diluted earnings per share of $0.20. Adjusted net income for the first quarter, which excludes share-based compensation, amortization, and other one-time expenses, was $89.3 million, or $0.63 per fully diluted share. A table reconciling GAAP net income attributable to The Baldwin Insurance Group, Inc.

to adjusted net income can be found in our earnings release and our 10-Q filed with the SEC. Adjusted EBITDA for the first quarter was up 21% at $137.2 million compared to $113.8 million in the prior year period. Adjusted EBITDA margin declined approximately 170 basis points year over year to 25.8% for the quarter, compared to 27.5% in the prior year period. The approximately 170 basis point margin decline is fully explained by two items. First, the consolidation of CAC, which has different margin seasonality due to timing and mix of revenues, and second, the UCTS profit-sharing contract Trevor mentioned. Adjusted free cash flow for the first quarter was roughly flat compared to $26 million in Q1 2025. The decrease was driven by working capital timing, which resulted in a $60 million use of cash.

More than half of the working capital headwind was from CAC, given a material payout of approximately $40 million in previously accrued cash bonuses and commissions, which The Baldwin Insurance Group, Inc. assumed in the opening balance sheet. As mentioned on the year-end call, we would expect CAC’s free cash flow conversion in the year to be better than legacy The Baldwin Insurance Group, Inc.’s rate. As such, we expect the timing headwind to reverse in quarters two through four. It is important to remember that Q1 is expected to be our lowest quarter of free cash flow conversion, given the payout of bonuses, as well as the substantial receivables that are built in our employee benefits business, the majority of which renew in January with payment monthly throughout the balance of the year.

This was somewhat exacerbated in Q1 2026 because of approximately $15 million of CAC transaction costs, representing a material increase in one-time cash outlay. Our full-year cash flow trajectory remains on track for double-digit growth in 2026. We ended the quarter with net leverage at approximately 4.3 times, as we deployed approximately $50 million of our $250 million buyback authorization to repurchase 2.2 million shares. We will remain prudent in our share repurchase program as we assess overall market conditions and act on market dislocation opportunities relative to other capital allocation alternatives to drive shareholder returns. The January 2026 partnerships with CAC and Ovi generated a significant net deferred tax liability, which resulted in a benefit to income tax expense in Q1 of approximately $145 million from the reversal of the majority of our valuation allowance.

As an offset to this benefit, we recorded an above-the-line operating expense to establish a liability associated with our tax receivable agreement of approximately $130 million. Note that the impact of each of these one-time transactions has been removed from adjusted EBITDA and adjusted EPS. We would expect income tax expense/benefit for the balance of 2026 to be minimal, and changes to the TRA liability will largely flow to the balance sheet going forward, with minimal further expected impact on the P&L. There will be no change to the manner in which we calculate the tax impact to adjusted net income in 2026. Looking ahead, our full-year consolidated guidance remains unchanged. Despite the challenging market backdrop, we remain confident in our ability to accelerate our total organic growth throughout the year.

For the second quarter, we expect revenue of $485 million to $490 million and organic revenue growth in the mid-single digits. We anticipate adjusted EBITDA between $113 million and $118 million and adjusted diluted EPS of $0.44 to $0.48 per share. In summary, we are pleased with the quarter, encouraged by the strong contribution from our recent partnerships across both cost savings and revenue synergies, and by the early operational impact of our 3B30 Catalyst program. Organic growth momentum is building, and we continue to expect a clear inflection in financial results in 2026 as we fully lap the idiosyncratic headwinds of the past year. We remain focused on accelerating execution across our platform, fully integrating our recent partnerships into The Baldwin Insurance Group, Inc., and leveraging new and innovative technology and AI solutions to enhance our client impact and long-term shareholder value creation.

We will now open the call for questions.

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Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment while we poll for questions. The first question comes from the line of Charles Gregory Peters with Raymond James. Please go ahead.

Charles Gregory Peters: Well, good afternoon, everyone. For my first question, I would like to focus on the organic revenue results and then briefly the comments you made about the revenue growth at CAC. The one area that caught me by surprise was the result in the UCTS line, which I think you called out there is a one-time item in there. Even on a pro forma basis, it seems like it is tracking lower than I might have envisioned for the year. So maybe you could provide some color there. And then related to your comments around growth, if you could go back and more slowly go through what seems to be some positive indications of growth coming out of CAC, that would be helpful.

Trevor Baldwin: Yes. Hey, Greg, appreciate the question. Let us start with UCTS. I did mention there was a large one-time contingent item in the prior year period. Normalizing for that, you are looking at 9% organic in the quarter for UCTS. We continue to have very strong underlying momentum in the UCTS segment. Our multifamily portfolio grew double digits in the quarter. Juniper Re continues to have very strong momentum with growth of over 90%. As broader evidence of that underlying momentum, we expect organic growth to recover to high single digits for UCTS in Q2 and back into the teens in the back half of the year. We are seeing continued headwinds in our E&S home portfolio as a result of soft market dynamics. As we push through Q1, the impacts of that in the prior year were already fairly material and should have less of an impact.

Specifically, our E&S home portfolio was down 30% in Q1; however, we expect it to be down high single digits for the full year, which should give you a sense of the recovery we expect over the balance of the year. At a high level, the underlying momentum at UCTS continues to be quite strong. It is a double-digit growth business, with a combination of a one-time item and an acute prior-year-period impact from the soft dynamics in E&S home normalizing through the balance of the year. Moving on to CAC, when we announced that partnership, we did it with conviction. We had that conviction because of the industrial logic of the combination, the quality of the people, the scarcity value of the capability set, and how that enables us to continue to grow and strengthen the impact we can deliver for our clients.

I said the CAC team is a Ferrari; we were going to put them on the track and let them run. They have come out of the gate fast. We expected strong results, but the strength has pleasantly surprised us—both in speed and scale. On expense synergies of approximately $43 million, we have already actioned over $34 million, well ahead of plan. On revenue synergies, which typically have a fairly long sales cycle, we have already realized $1 million in the first quarter, and as of today, nearly $3 million, with more than $10 million of active cross-sell opportunities being worked by the combined teams. We are seeing strength not in any one pocket but broadly—industry practice groups, legacy middle market, and the transaction liability group, which is taking share.

Combined with the legacy The Baldwin Insurance Group, Inc. teams, we are leveraging those capabilities to drive more significant impact for existing clients. It is all incredibly positive.

Charles Gregory Peters: Great. I think I have to pivot from my follow-up question to the Catalyst program slide you put in your slide deck. You talk about this initiative in the context of the 3B30, getting to the 30% margin target. Can you walk us through the run-rate annualized savings and the positive payback? Does that get us to that 30% run rate that you are thinking about, or are there more levers you have to pull to get to your objective?

Trevor Baldwin: I think this on a standalone basis does not fully get there, but regular-way operating leverage that is in the business, in combination with the Catalyst program, does. As I mentioned, the program is live, on track, and the early results are positive. You may have seen a press release around our expanded partnership with Anthropic’s Claude on an enterprise basis, as well as the work we have been doing to build out our proprietary orchestration layer, driving real productivity and efficiency into our operations. A recent example: our product team at DMGA came together to build and launch an admitted insurance product. Historically, creating an admitted product requires a series of competitive analyses, rate and product feature determinations, and filing creation tasks—a process that has historically taken months, three on average, with significant manual manipulation of documents and data.

The product management team leveraged Claude on top of our proprietary data across each phase of the process and significantly compressed the timeline from months to three days. As you think about how that translates into the velocity of new products we can bring to market—whether the new builder products we expect later this year, a mortgage product we are working on, or a manufactured home program for a number of our property management software clients—the impact will be real and significant. We are excited about what we are seeing.

Bradford Lenzie Hale: Greg, I would just add it is the combination of the Catalyst program and the meaningful investments we have made in the business, such as mortgage embedded, in addition to the products that Trevor highlighted. The maturity of those businesses is also a meaningful driver of margin expansion toward the 3B30 goal.

Charles Gregory Peters: That makes sense. Thanks for the detail.

Trevor Baldwin: Thanks, Greg.

Operator: Thank you. Next question comes from the line of Thomas Patrick McJoynt-Griffith with KBW. Please go ahead.

Thomas Patrick McJoynt-Griffith: Hey, good evening. You sounded optimistic about the early signs of success around cross-sell with the CAC Group. Could you give us some examples of where you are actually seeing success there? Is it finding new solutions or taking market share from other brokers? Maybe elaborate on that point.

Trevor Baldwin: It is all of those things, and it is going both ways. A couple of examples: The CAC team has deep industry capabilities across natural resources, private equity, and real estate, and we have historically had deep capabilities across construction. One of the CAC colleagues brought forth an opportunity for a large general contractor prospect that historically they probably would not have pursued because they did not feel like they had all the capabilities to serve them at the level CAC seeks to serve clients. Because of the combination with our platform, they were able to bring in some of our construction professionals and, through an RFP process, we won that client. The incumbent was a top-five global broker, and our competition included both global brokers and large nationals.

It was a standout win and brought momentum to the team. Similarly, at legacy The Baldwin Insurance Group, Inc., we have professionals with deep expertise and strong relationships across private equity and the M&A universe, and CAC has an incredibly deep bench of talent here, not only on transaction solutions but also broadly across portfolio solutions. The legacy The Baldwin Insurance Group, Inc. team had a client entering into a complex cross-border international M&A transaction. I cannot get into detail due to NDAs, but this was highly complex. The CAC team stepped in, delivered a set of solutions that helped facilitate a seamless signing, and it is a significant six-figure revenue opportunity for an existing client that otherwise likely would have gone to one of our global broker competitors.

The pipeline is robust across construction, energy, data center, and power generation, as well as broad-based large upmarket complex opportunities. Momentum continues to build.

Thomas Patrick McJoynt-Griffith: Thanks. Switching gears to one of the headwinds you have been calling out—the Medicare side. Can you remind us, is the cadence or seasonality such that the 2026 headwind has been baked in? Or is that more of a 2027 issue?

Trevor Baldwin: We expect that headwind to largely resolve itself beginning next quarter. While we are not expecting a miraculous turnaround, we do not anticipate a meaningful headwind going forward there.

Operator: Next question comes from the line of Charles William Lederer with BMO Capital Markets. Please go ahead.

Charles William Lederer: Hey, thanks. I want to go back to UCTS for a second. I know you called out the headwind, but you also had a fairly nice tailwind in the earned premium line there. If I exclude that, you were down a little bit more in UCTS. Is that all E&S home and the real estate product? And what is going to drive the improvement over the rest of the year?

Trevor Baldwin: That is right. We did benefit from continued growth in the multifamily earned premium in the captive, which we view as incremental economics on a high-performing overall program. The headwind was almost entirely the one-time contingent as well as the headwinds in the E&S business. We expect momentum to pick up across most, if not all, of our product sets over the balance of the year, as evidenced by our confidence in high single-digit organic growth in Q2 and returning to teens organic growth in the back half of the year. Momentum is strong, with nuances from last year both in where the E&S book stood and that one-time contingent.

Charles William Lederer: Got it, thanks. Then on the buybacks, can you talk about how motivated you feel now to still buy back shares? Or now that the stock is closer to peers, maybe it is less of a priority?

Bradford Lenzie Hale: Our capital allocation priorities remain intact: number one, organic investments; two, M&A; followed by buybacks; and then dividends or debt paydown. We are not an indiscriminate buyer. We are thoughtful about price as we deploy capital, and we continue to target the best risk-weighted return alternative. To the extent we see dislocation of price, we will continue to be active.

Trevor Baldwin: Put differently, we can continue, even at these prices, to buy in our own shares at a meaningful discount to what smaller, lower-quality private agencies trade for today. We continue to find our stock price attractive.

Operator: Thank you. Next question comes from the line of Elyse Greenspan with Wells Fargo. Please go ahead.

Elyse Greenspan: Hi, thanks. I will continue on the buybacks. You did not raise the EPS guide for the year, but you obviously bought back in Q1, and it sounds like, Trevor, based on what you just said, you are open to continuing to buy back your shares. How come not raising the EPS guide? Or is the guidance assuming no additional buyback over the remaining three quarters?

Trevor Baldwin: We are not going to assume how stock price performance goes. To the extent we have the opportunity to buy back shares at an attractive price, that could create some upside. To the extent we do not, that likely reflects recovery in trading dynamics.

Elyse Greenspan: Thanks. My second question: you provided some figures on CAC highlighting strong new business growth and revenue growth in the first quarter. On the three deals, the revenue and EBITDA contributions you expect for 2026 have not changed, but it sounds like things are running ahead of expectations. Are you waiting to update that, or is it that some are running ahead and some are running below plan relative to the guidance you reaffirmed?

Trevor Baldwin: Broadly, the three partnership businesses are running ahead of plan, but we are one quarter in, so it is early to fully extrapolate. As I mentioned, momentum at CAC is incredibly strong. Some of that momentum is in transaction liability solutions, where there can be variability quarter to quarter and year to year. The pipeline in that part of the business is at an all-time high, and we continue to take share. We feel good about the momentum but believe it is early in the year to extrapolate to full-year expectations.

Elyse Greenspan: Lastly, on market impact, what are you seeing from an overall pricing perspective in the property market? We have heard about aggressive price declines. What are you embedding over the next three quarters?

Trevor Baldwin: The property market is deeply soft. We are seeing pricing levels that have returned to circa 2017. For large shared and layered coastal placements, we are seeing rate decreases at times of 30% to 40%. While those may not make long-term sense, our clients certainly enjoy them. We expect a more significant rate and exposure headwind in the second quarter, which is the heaviest quarter for property renewals. Whereas we saw approximately 70 basis points of headwind in Q1, I expect that to be 400 to 500 basis points in Q2. As a result, we expect our legacy IAS segment to be roughly flat from an organic standpoint in the second quarter before returning to mid- to high-single-digit organic growth in the back half of the year as we fully lap the procedural accounting change headwinds.

Based on what we are seeing today, rate and exposure headwinds in the back half of the year should be pretty close to flat—maybe a slight headwind in Q3 and a slight headwind or a tailwind in Q4. Overall, for the year, we expect rate and exposure to be a 100 to 200 basis point headwind, and that is fully incorporated into the expectations we have shared.

Operator: Thank you. Next question comes from the line of Andrew Kligerman with TD Cowen. Please go ahead.

Andrew Kligerman: Hey, thanks a lot. Good evening. I want to follow up on IAS organic growth. You had 4 points in the quarter of organic, and then CAC, if normalized, contributed 4 to the overall book. If IAS and CAC had been there for over a year, you are well into the double digits, which is fabulous. You noted transaction liability can be volatile, but typically when you do an acquisition you get a good year one and similar organic in year two. Extracting out the volatility of transaction liability, all else equal, you would probably be looking at high single into double digits potentially next year once you get a full year on board. Am I thinking about it right with regard to IAS?

Trevor Baldwin: At a high level, yes. It is a double-digit organic growth business inclusive of CAC and results, which we think is a standout outcome in today’s market backdrop. Specific to 2027, it is too early for us to opine on organic growth next year. However, everything we are seeing from underlying trends and datasets is very positive. Pipelines are building, cross-sell opportunities are growing. We expect in the back half of the year legacy IAS organic to re-rate back up into the mid- to high-single digits. Considering CAC’s momentum, historical seasonality, and pipelines, it is incredibly strong. We are proud of the results—relative to peers, a standout in the quarter, inclusive of CAC and Capstone. They reflect the wisdom of the business combination and the combined strengths of the organization across industry and product segments, enabling us to solve clients’ challenges and deliver meaningful impact to help them manage risk and grow their enterprises.

We feel really good about the momentum.

Andrew Kligerman: Following up on capital management, it sounds like the intrinsic value of the stock is still attractive here, so I want to make sure I heard that right. With respect to leverage, which inched up to 4.3 times—partly due to the buyback—where do you see leverage toward the end of the year? Do you get to three to four times, or is the stock so attractive that you are willing to let it hover where it is? And does that imply limited major M&A near term?

Bradford Lenzie Hale: We would continue to expect leverage to hover in the 4.0 to 4.5 times range over the intermediate term, particularly as we continue to execute on the buyback program. We are not price indiscriminate, so that can change, but that is our current view.

Trevor Baldwin: We continue to believe that mechanically deleveraging six months earlier, while our equity trades at a material discount, is a destruction of shareholder value, not a creation of it. We are comfortable here, particularly if we can take advantage of market dislocation. On M&A, it is difficult for us to find a financially prudent way to structure a deal that makes sense based on where our equity trades today. That plus where leverage sits creates a hurdle. Historically, we have allocated capital to M&A in a way that has created value intrinsically, and while we are very early, we appear to be off to a great start with the 2026 class of partnerships. Within our financial leverage policy and objectives to delever over time, and subject to us having a currency that supports M&A in an accretive fashion, we think it is a very good use of capital over time. The circumstances today dictate a more narrow set of priorities.

Andrew Kligerman: Super helpful. Thank you.

Operator: Thank you. Next question comes from the line of Pablo Singzon with JPMorgan. Please go ahead.

Pablo Singzon: Hi, thank you. First, can you unpack what is going on with the E&S homeowners business? I am a bit surprised. Given what other companies are reporting, pricing in homeowners is not experiencing the same pressure as in personal auto. Are you dealing with a different set of competitors in that business, and is that why you are a little more cautious?

Trevor Baldwin: No. That may be homeowners broadly across admitted and E&S products, but E&S home specifically has seen rate come in 40% to 50% plus. Eighteen months ago, we were writing $1.314 billion of new premium a month, and over the past twelve months averaging 2 to 3. As we continue to tweak our product, we are rolling out multiple new E&S home product variants to better compete in pockets of the market we find attractive. We expect new business flow to go up. We saw that reflected in March with over $4 million of new E&S home premium booked, the highest new business month in the past twelve months. That is one month, not a trend, but we feel like we hit the bottom in Q1 and will march back up through prudent product design and pricing tweaks and rollout of incremental product variants to resume growth.

Pablo Singzon: Thanks, Trevor. Second, could you talk about the Construction Risk Partners business you acquired some time ago? I think it is a decent-sized portion of IAS. Other brokers have spoken about activity related to data center construction. Are you getting benefit from that economic activity today?

Trevor Baldwin: The CRP team—the Baldwin Construction practice, which reflects the historical Construction Risk Partners business—has the largest and strongest pipeline in our construction business’s history. That is a combination of an influx of new cross-sell opportunities from CAC and a breadth of opportunities at the nexus of the data center and AI infrastructure buildout. The construction market is a tale of two cities. Overall expectations for construction spend this year are roughly flat year over year, if not modestly down, buoyed by significant spending in data centers, offset by slowdowns in non–data center areas. That means results will be lumpier because data center opportunities are fewer but larger in scale. We have some wins under our belt and multiple very large multibillion-dollar opportunities in the near- to intermediate-term pipeline, and we feel good about taking more than our fair share.

Operator: Thank you. Next question comes from the line of Joshua David Shanker with Bank of America. Please go ahead.

Joshua David Shanker: Good evening, everybody. I want to point out that 90% growth in Juniper Re and 27% growth in the new partnerships are staggering numbers. But it also implies contraction in legacy businesses that are older in the portfolio. If someone wanted to argue that The Baldwin Insurance Group, Inc. has bought growth but not long-term runners, and is once again buying growth, what is the pushback on that thesis?

Trevor Baldwin: The pushback is in the numbers and expectations we have shared. The headwinds have been well discussed—idiosyncratic drivers from Medicare to the IAS procedural accounting change to the QBE book roll transition to our reciprocal exchange. Normalizing for all three, you have a mid-single-digit growth business in the quarter and a business we expect to grow organically at double-digit rates exiting this year, before the impact of the three partnerships that grew 27% in the quarter. All businesses have ebbs and flows, and the market impacts are real across the industry. We are relatively uniquely positioned to accelerate to high single-digit and then double-digit growth by the fourth quarter, despite no expectation for market headwinds to meaningfully abate.

Joshua David Shanker: So you still believe if the insurance distribution industry at year-end is growing mid- to low-single digits, The Baldwin Insurance Group, Inc. will be growing at high single digits, edging toward double digits?

Bradford Lenzie Hale: That is correct.

Joshua David Shanker: Okay. I wish you the best of luck there then. Very good.

Bradford Lenzie Hale: Thanks, Josh.

Operator: Thank you. Ladies and gentlemen, we have reached the end of the question-and-answer session. I would now like to hand the floor over to Trevor Baldwin, CEO, for closing comments.

Trevor Baldwin: Thank you all for joining us this evening. As I noted at the open, we are pleased with our first quarter and confident in our trajectory through the balance of the year. The momentum here is real—our embedded distribution, our advisory businesses across our MGA platform, and as evidenced in the integration of our partnerships. It is the direct result of the work our colleagues are putting in every day. I want to thank our colleagues for how they show up in support of our clients, one another, and for the firm we are building together. To our clients and insurance company partners, thank you for your continued trust. To our shareholders, thank you for your engagement and support. We continue to deliver against our Catalyst 3B30 goals and objectives. We look forward to speaking with you again next quarter.

Bonnie Bishop: Thank you.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.

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