# EDGAR Filing Document

**Accession Number:** 0000079282
**File Stem:** 0000950170-23-001037
**Filing Date:** 2023-1
**Character Count:** 30250
**Document Hash:** b75d18b20008e481a7d9ee04b3af2dd7
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000950170-23-001037.hdr.sgml**: 20230124

**ACCESSION NUMBER**: 0000950170-23-001037

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20230123

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230124

**DATE AS OF CHANGE**: 20230123

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** BROWN & BROWN, INC.
- **CENTRAL INDEX KEY:** 0000079282
- **STANDARD INDUSTRIAL CLASSIFICATION:** INSURANCE AGENTS BROKERS & SERVICES [6411]
- **IRS NUMBER:** 590864469
- **STATE OF INCORPORATION:** FL
- **FISCAL YEAR END:** 0119

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-13619
- **FILM NUMBER:** 23545360

**BUSINESS ADDRESS:**
- **STREET 1:** 300 N. BEACH STREET
- **CITY:** DAYTONA BEACH
- **STATE:** FL
- **ZIP:** 32114
- **BUSINESS PHONE:** 386-252-9601

**MAIL ADDRESS:**
- **STREET 1:** 300 N. BEACH STREET
- **CITY:** DAYTONA BEACH
- **STATE:** FL
- **ZIP:** 32114

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** BROWN & BROWN, INC
- **DATE OF NAME CHANGE:** 20171108

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** BROWN & BROWN INC
- **DATE OF NAME CHANGE:** 19990623

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** POE & BROWN INC
- **DATE OF NAME CHANGE:** 19930827

?xml version="1.0" encoding="ASCII"? 8-K

**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):** January 23, 2023

BROWN & BROWN, INC.

**(Exact name of registrant as specified in its charter)**

---

| | | |
|:---|:---|:---|
| Florida | 001-13619 | 59-0864469 |
| **(State or other jurisdiction**<br>**of incorporation)** | **(Commission**<br>**File Number)** | **(IRS Employer**<br>**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.**

On January 23, 2023, Brown & Brown, Inc. issued a press release announcing its results of operations for the fourth quarter and fiscal year ended December 31, 2022. A copy of the press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

The information furnished herewith pursuant to Item 2.02 of this Current Report, including Exhibit 99.1, shall not be deemed to be filed for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section. The information in this current report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

**Item 9.01 Financial Statements and Exhibits.**

(d) Exhibits

The following exhibit is furnished herewith:

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 99.1 | [<u>Press Release dated January 23, 2023.</u>](bro-ex99_1.htm) |
| 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: January 23, 2023

---

| | |
|:---|:---|
|  | BROWN & BROWN, INC. |
|  | (Registrant) |
| By: | /s/ R. Andrew Watts |
|  | R. Andrew Watts, Executive Vice President, Chief Financial Officer and Treasurer |

---

------

## Exhibit 99.1

**Exhibit 99.1**

![img231960038_0.jpg](img231960038_0.jpg)

**Brown & Brown, Inc. announces quarterly revenues of $901.4 million, an increase of 22.1%, diluted net income per share of $0.51 and Diluted Net Income Per Share - Adjusted of $0.50**

**DAYTONA BEACH, Fla., January 23, 2023 -** Brown & Brown, Inc. (NYSE:BRO) (the "Company") today announced its unaudited financial results for the fourth quarter and full year of 2022.

Revenues for the fourth quarter of 2022 under U.S. generally accepted accounting principles ("GAAP") were $901.4 million, increasing $162.9 million, or 22.1%, compared to the fourth quarter of the prior year, with commissions and fees increasing by 21.3% and Organic Revenue increasing by 7.8%. Income before income taxes was $194.2 million, increasing 37.9% from the fourth quarter of the prior year with Income Before Income Taxes Margin increasing to 21.5% from 19.1%. EBITDAC - Adjusted was $283.1 million, increasing 34.9% from the fourth quarter of the prior year with EBITDAC Margin - Adjusted increasing to 31.4% from 28.5%. Net income was $145.2 million, increasing $43.5 million, or 42.8%, and diluted net income per share increased to $0.51, or 41.7%, with Diluted Net Income Per Share - Adjusted increasing to $0.50, or 28.2%, as compared to the fourth quarter of the prior year.

Revenues for the twelve months ended December 31, 2022 under GAAP were $3,573.4 million, increasing $522.0 million, or 17.1%, as compared to 2021, with commissions and fees increasing by 16.9%, and Organic Revenue increasing by 8.1%. Income before income taxes was $876.1 million, increasing 14.9% with Income Before Income Taxes Margin decreasing to 24.5% from 25.0% as compared to 2021. EBITDAC - Adjusted was $1,170.9 million, increasing 15.9% with EBITDAC Margin - Adjusted decreasing to 32.8% from 33.2% as compared to 2021. Net income was $671.8 million, increasing $84.7 million, or 14.4%, with diluted net income per share increasing to $2.37, or 14.5% and Diluted Net Income Per Share - Adjusted increasing to $2.28, or 6.5%, as compared to 2021.

J. Powell Brown, president and chief executive officer of the Company, noted, "Our team delivered another year of strong profitable growth. I want to thank all of our dedicated teammates throughout the world who continue to deliver for our customers every day."

------

**Reconciliation of Commissions and Fees**

**to Organic Revenue**

**Three and Twelve Months Ended December 31, 2022 and 2021**

**(in millions, unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Commissions and fees** | $**895.0** | $**737.9** | $**3563.2** | $**3047.5** |
| &nbsp;&nbsp;&nbsp;Profit-sharing contingent commissions | (30.2) | (19.1) | (88.7) | (82.2) |
| **Core commissions and fees** | $**864.8** | $**718.8** | $**3474.5** | $**2965.3** |
| &nbsp;&nbsp;&nbsp;Acquisitions | (100.1) |  | (288.6) |  |
| &nbsp;&nbsp;&nbsp;Dispositions |  | (8.0) |  | (14.8) |
| &nbsp;&nbsp;&nbsp;Foreign Currency Translation |  | (1.5) |  | (4.5) |
| **Organic Revenue** | $**764.7** | $**709.3** | $**3185.9** | $**2946.0** |
| **Organic Revenue growth** | $**55.4** |  | $**239.9** |  |
| **Organic Revenue growth %** | **7.8%** |  | **8.1%** |  |

---

See information regarding non-GAAP measures presented later in this press release.

**Reconciliation of Diluted Net Income Per Share to**

**Diluted Net Income Per Share - Adjusted**

**Three and Twelve Months Ended December 31, 2022 and 2021**

**(unaudited)**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,**<br>**Change** | **Change** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,**<br>**Change** | **Change** |
|  | **2022** | **2021** | **%** | **2022** | **2021** | **%** |
| **Diluted net income per share** | $**0.51** | $**0.36** | **41.7%** | $**2.37** | $**2.07** | **14.5%** |
| &nbsp;&nbsp;&nbsp;Change in estimated acquisition earn-out payables | (0.01) | 0.05) |  | (0.10) | 0.10) |  |
| &nbsp;&nbsp;&nbsp;(Gain)/loss on disposal | (0.01) | (0.01) |  | (0.02) | (0.02) |  |
| &nbsp;&nbsp;&nbsp;Acquisition/Integration Costs | 0.01 |  |  | 0.03 |  |  |
| &nbsp;&nbsp;&nbsp;Foreign Currency Translation |  | (0.01) |  |  | (0.01) |  |
| **Diluted Net Income Per Share - Adjusted** | $**0.50** | $**0.39** | **28.2%** | $**2.28** | $**2.14** | **6.5%** |

---

See information regarding non-GAAP measures presented later in this press release.

------

**Reconciliation of Total Revenues to Total Revenues - Adjusted, Income Before Income Taxes to** 

**EBITDAC and EBITDAC - Adjusted and Income Before Income Taxes Margin to EBITDAC Margin and EBITDAC Margin - Adjusted**

**Three and Twelve Months Ended December 31, 2022 and 2021**

**(in millions, unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Total revenues** | $**901.4** | $**738.5** | $**3573.4** | $**3051.4** |
| &nbsp;&nbsp;&nbsp;Foreign Currency Translation |  | (1.7) |  | (4.8) |
| **Total Revenues - Adjusted** | $**901.4** | $**736.8** | $**3573.4** | $**3046.6** |
| **Income before income taxes** | $**194.2** | $**140.8** | $**876.1** | $**762.8** |
| **Income Before Income Taxes Margin** | **21.5%** | **19.1%** | **24.5%** | **25.0%** |
| &nbsp;&nbsp;&nbsp;Amortization | 38.4 | 31.0 | 146.6 | 119.6 |
| &nbsp;&nbsp;&nbsp;Depreciation | 10.9 | 7.9 | 39.2 | 33.3 |
| &nbsp;&nbsp;&nbsp;Interest | 45.4 | 16.2 | 141.2 | 65.0 |
| &nbsp;&nbsp;&nbsp;Change in estimated acquisition earn-out payables | (5.8) | 19.8 | (38.9) | 40.4 |
| **EBITDAC** | $**283.1** | $**215.7** | $**1164.2** | $**1021.1** |
| **EBITDAC Margin** | **31.4%** | **29.2%** | **32.6%** | **33.5%** |
| &nbsp;&nbsp;&nbsp;(Gain)/loss on disposal | (3.6) | (5.3) | (4.5) | (9.6) |
| &nbsp;&nbsp;&nbsp;Acquisition/Integration Costs | 3.6 |  | 11.2 |  |
| &nbsp;&nbsp;&nbsp;Foreign Currency Translation |  | (0.5) |  | (1.4) |
| **EBITDAC - Adjusted** | $**283.1** | $**209.9** | $**1170.9** | $**1010.1** |
| **EBITDAC Margin - Adjusted** | **31.4%** | **28.5%** | **32.8%** | **33.2%** |

---

See information regarding non-GAAP measures presented later in this press release.

------

**Brown & Brown, Inc.**

**Consolidated Statements of Income**

(in millions, except per share data; unaudited)

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31,** | **Three Months Ended December 31,** | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **REVENUES** |  |  |  |  |
| Commissions and fees | $895.0 | $737.9 | $3563.2 | $3047.5 |
| Investment income | 4.7 | 0.2 | 6.5 | 1.1 |
| Other | 1.7 | 0.4 | 3.7 | 2.8 |
| &nbsp;&nbsp;&nbsp;Total revenues | 901.4 | 738.5 | 3573.4 | 3051.4 |
| **EXPENSES** |  |  |  |  |
| Employee compensation and benefits | 475.6 | 416.8 | 1816.9 | 1636.9 |
| Other operating expenses | 146.3 | 111.3 | 596.8 | 403.0 |
| (Gain)/loss on disposal | (3.6) | (5.3) | (4.5) | (9.6) |
| Amortization | 38.4 | 31.0 | 146.6 | 119.6 |
| Depreciation | 10.9 | 7.9 | 39.2 | 33.3 |
| Interest | 45.4 | 16.2 | 141.2 | 65.0 |
| Change in estimated acquisition earn-out payables | (5.8) | 19.8 | (38.9) | 40.4 |
| &nbsp;&nbsp;&nbsp;Total expenses | 707.2 | 597.7 | 2697.3 | 2288.6 |
| Income before income taxes | 194.2 | 140.8 | 876.1 | 762.8 |
| Income taxes | 49.0 | 39.1 | 204.3 | 175.7 |
| Net income | $145.2 | $101.7 | $671.8 | $587.1 |
| Net income per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | $0.51 | $0.36 | $2.38 | $2.08 |
| &nbsp;&nbsp;&nbsp;Diluted | $0.51 | $0.36 | $2.37 | $2.07 |
| Weighted average number of shares outstanding - in thousands: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 278048 | 276571 | 277521 | 276024 |
| &nbsp;&nbsp;&nbsp;Diluted | 279018 | 278128 | 278658 | 277414 |
| Dividends declared per share | $0.115 | $0.103 | $0.423 | $0.380 |

---

------

**Brown & Brown, Inc.**

**Consolidated Balance Sheets**

(in millions, except per share data, unaudited)

---

| | | |
|:---|:---|:---|
|  | **December 31,<br>2022** | **December 31,<br>2021** |
| **ASSETS** |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | $650.0 | $693.3 |
| &nbsp;&nbsp;&nbsp;Fiduciary cash | 1383.2 | 777.0 |
| &nbsp;&nbsp;&nbsp;Short-term investments | 12.0 | 12.9 |
| &nbsp;&nbsp;&nbsp;Commission, fees, and other receivable | 642.9 | 522.6 |
| &nbsp;&nbsp;&nbsp;Fiduciary receivables | 881.4 | 693.7 |
| &nbsp;&nbsp;&nbsp;Reinsurance recoverable | 831.0 | 63.1 |
| &nbsp;&nbsp;&nbsp;Prepaid reinsurance premiums | 393.2 | 392.2 |
| &nbsp;&nbsp;&nbsp;Other current assets | 202.3 | 175.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 4996.0 | 3330.3 |
| Fixed assets, net | 239.9 | 212.0 |
| Operating lease assets | 214.9 | 197.0 |
| Goodwill | 6674.2 | 4736.8 |
| Amortizable intangible assets, net | 1595.2 | 1081.5 |
| Investments | 22.4 | 31.0 |
| Other assets | 230.9 | 206.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $13973.5 | $9795.4 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Fiduciary liabilities | $2264.6 | $1470.7 |
| &nbsp;&nbsp;&nbsp;Losses and loss adjustment reserve | 841.1 | 63.1 |
| &nbsp;&nbsp;&nbsp;Unearned premiums | 412.3 | 392.2 |
| &nbsp;&nbsp;&nbsp;Accounts payable | 286.5 | 242.7 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other liabilities | 541.5 | 456.2 |
| &nbsp;&nbsp;&nbsp;Current portion of long-term debt | 250.6 | 42.5 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 4596.6 | 2667.4 |
| Long-term debt | 3691.5 | 1980.4 |
| Operating lease liabilities | 195.9 | 180.0 |
| Deferred income taxes, net | 584.0 | 386.8 |
| Other liabilities | 298.9 | 383.9 |
| Shareholders' equity: |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, par value $0.10 per share; authorized 560.0 shares; issued 302.9 shares and outstanding 283.2 shares at 2022, issued 301.0 shares and outstanding 282.5 shares at 2021, respectively | 30.3 | 30.1 |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 919.7 | 849.4 |
| &nbsp;&nbsp;&nbsp;Treasury stock, at cost 19.7 shares at 2022, 18.5 shares at 2021, respectively. | (748.0) | (673.9) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (148.4) | (9.4) |
| &nbsp;&nbsp;&nbsp;Retained earnings | 4553.0 | 4000.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 4606.6 | 4196.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $13973.5 | $9795.4 |

---

------

**Brown & Brown, Inc.**

**Consolidated Statements of Cash Flows**

(in millions, unaudited)

------

---

| | | |
|:---|:---|:---|
|  | **Twelve Months Ended December 31,** | **Twelve Months Ended December 31,** |
|  | **2022** | **2021** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net income | $671.8 | $587.1 |
| Adjustments to reconcile net income to net cash provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Amortization | 146.6 | 119.6 |
| &nbsp;&nbsp;&nbsp;Depreciation | 39.2 | 33.3 |
| &nbsp;&nbsp;&nbsp;Non-cash stock-based compensation | 66.1 | 61.0 |
| &nbsp;&nbsp;&nbsp;Change in estimated acquisition earn-out payables | (38.9) | 40.4 |
| &nbsp;&nbsp;&nbsp;Deferred income taxes | 42.8 | 33.6 |
| &nbsp;&nbsp;&nbsp;Amortization of debt discount and disposal of deferred financing costs | 3.8 | 2.8 |
| &nbsp;&nbsp;&nbsp;Amortization of discounts and premiums, investment | 0.2 | 0.1 |
| &nbsp;&nbsp;&nbsp;Net (gain)/loss on sales/disposals of investments, fixed assets and customer accounts | (3.6) | (7.1) |
| &nbsp;&nbsp;&nbsp;Payments on acquisition earn-outs in excess of original estimated payables | (30.1) | (21.1) |
| &nbsp;&nbsp;&nbsp;Effect of changes in foreign exchange rate | (0.6) | 0.5 |
| Changes in operating assets and liabilities, net of effect from acquisitions and divestitures: |  |  |
| &nbsp;&nbsp;&nbsp;Commissions and fees receivable (increase)/decrease | (60.9) | (61.9) |
| &nbsp;&nbsp;&nbsp;Reinsurance recoverables (increase)/decrease | (767.9) | (19.6) |
| &nbsp;&nbsp;&nbsp;Prepaid reinsurance premiums (increase)/decrease | (1.0) | (14.6) |
| &nbsp;&nbsp;&nbsp;Other assets (increase)/decrease | (17.6) | (53.7) |
| &nbsp;&nbsp;&nbsp;Losses and loss adjustment reserve increase/(decrease) | 777.9 | 19.6 |
| &nbsp;&nbsp;&nbsp;Unearned premiums increase/(decrease) | 20.1 | 14.6 |
| &nbsp;&nbsp;&nbsp;Accounts payable increase/(decrease) | 124.3 | 54.4 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other liabilities increase/(decrease) | 37.0 | 66.9 |
| &nbsp;&nbsp;&nbsp;Other liabilities increase/(decrease) | (127.8) | (47.1) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by operating activities** | 881.4 | 808.8 |
| **Cash flows from investing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Additions to fixed assets | (52.6) | (45.0) |
| &nbsp;&nbsp;&nbsp;Payments for businesses acquired, net of cash acquired | (1927.7) | (366.8) |
| &nbsp;&nbsp;&nbsp;Proceeds from sales of fixed assets and customer accounts | 60.3 | 16.7 |
| &nbsp;&nbsp;&nbsp;Purchases of investments | (0.1) | (12.4) |
| &nbsp;&nbsp;&nbsp;Proceeds from sales of investments | 7.4 | 10.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash used in investing activities** | (1912.7) | (396.7) |
| **Cash flows from financing activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Fiduciary receivables and liabilities, net | 96.2 | 133.7 |
| &nbsp;&nbsp;&nbsp;Deferred acquisition purchase payment | (5.1) |  |
| &nbsp;&nbsp;&nbsp;Payments on acquisition earn-outs | (76.2) | (62.5) |
| &nbsp;&nbsp;&nbsp;Proceeds from long-term debt | 2000.0 |  |
| &nbsp;&nbsp;&nbsp;Payments on long-term debt | (61.3) | (73.1) |
| &nbsp;&nbsp;&nbsp;Deferred debt issuance costs | (23.4) | (2.6) |
| &nbsp;&nbsp;&nbsp;Borrowings on revolving credit facilities | 350.0 |  |
| &nbsp;&nbsp;&nbsp;Payments on revolving credit facilities | (350.0) |  |
| &nbsp;&nbsp;&nbsp;Issuances of common stock for employee stock benefit plans | 37.6 | 34.0 |
| &nbsp;&nbsp;&nbsp;Repurchase shares to fund tax withholdings for non-cash stock-based compensation | (48.8) | (49.8) |
| &nbsp;&nbsp;&nbsp;Purchase of treasury stock | (74.1) | (82.6) |
| &nbsp;&nbsp;&nbsp;Cash dividends paid | (119.5) | (107.2) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net cash provided by/(used in) financing activities** | 1725.4 | (210.1) |
| Effect of foreign exchange rate changes in cash and cash equivalents inclusive of fiduciary cash | (131.2) | (3.6) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net increase in cash and cash equivalents inclusive of fiduciary cash** | 562.9 | 198.4 |
| Cash and cash equivalents inclusive of fiduciary cash at beginning of period | 1470.3 | 1271.9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Cash and cash equivalents inclusive of fiduciary cash at end of period** | $2033.2 | $1470.3 |

---

------

**<u>Conference call, webcast and slide presentation</u>**

A conference call to discuss the results of the fourth quarter and full year of 2022 will be held on Tuesday, January 24, 2023, at 8:00 AM (EST). The Company may refer to a slide presentation during its conference call. You can access the webcast and the slides from the "Investor Relations" section of the Company's website at <u>bbinsurance.com.</u>

**<u>About Brown & Brown</u>**

Brown & Brown, Inc. (NYSE: BRO) is a leading insurance brokerage firm, delivering risk management solutions to individuals and businesses since 1939. With more than 14,500 teammates in 450+ locations worldwide, we are committed to providing innovative strategies to help protect what our customers value most. For more information or to find an office near you, please visit <u>bbinsurance.com</u>.

**<u>Forward-looking statements</u>**

------

markets in which we operate; disintermediation within the insurance industry, including increased competition from insurance companies, technology companies and the financial services industry, as well as the shift away from traditional insurance markets; conditions that result in reduced insurer capacity; quarterly and annual variations in our commissions that result from the timing of policy renewals and the net effect of new and lost business production; intangible asset risk, including the possibility that our goodwill may become impaired in the future; the COVID-19 pandemic, as well as future pandemics, epidemics or outbreaks of infectious diseases, and the resulting governmental and societal responses; other risks and uncertainties as may be detailed from time to time in our public announcements and Securities and Exchange Commission ("SEC") filings; and other factors that the Company may not have currently identified or quantified. All forward-looking statements made herein are made only as of the date of this release, and the Company does not undertake any obligation to publicly update or correct any forward-looking statements to reflect events or circumstances that subsequently occur or of which the Company hereafter becomes aware.

**<u>Non-GAAP supplemental financial information</u>**

This press release contains references to "non-GAAP financial measures" as defined in SEC Regulation G, consisting of Total Revenues **-** Adjusted, Organic Revenue, EBITDAC, EBITDAC Margin, EBITDAC - Adjusted, EBITDAC Margin - Adjusted and Diluted Net Income Per Share - Adjusted. We present these measures because we believe such information is of interest to the investment community and because we believe it provides additional meaningful methods to evaluate the Company's operating performance from period to period on a basis that may not be otherwise apparent on a GAAP basis due to the impact of certain items that have a high degree of variability and that we believe are not indicative of ongoing performance. This non-GAAP financial information should be considered in addition to, not in lieu of, the Company's consolidated income statements and balance sheets as of the relevant date. Consistent with Regulation G, a description of such information is provided below and a reconciliation of such items to GAAP information can be found within this press release as well as in our periodic filings with the SEC.

We view Organic Revenue and Organic Revenue growth as important indicators when assessing and evaluating our performance on a consolidated basis and for each of our four segments, because it allows us to determine a comparable, but non-GAAP, measurement of revenue growth that is associated with the revenue sources that were a part of our business in both the current and prior year and that are expected to continue in the future. In addition, we believe Diluted Net Income Per Share - Adjusted provides a meaningful representation of our operating performance and improves the comparability of our results between periods by excluding the impact of the change in estimated acquisition earn-out payables, the impact of foreign currency translation and certain other non-recurring or infrequently occurring items. We also view Total Revenues - Adjusted, EBITDAC, EBITDAC - Adjusted, EBITDAC Margin and EBITDAC Margin - Adjusted as important indicators when assessing and evaluating our performance, as they present more comparable measurements of our operating margins in a meaningful and consistent manner. As disclosed in our most recent proxy statement, we use Organic Revenue, Diluted Net Income Per Share - Adjusted and EBITDAC Margin as key performance metrics for our short-term and long-term incentive compensation plans for executive officers and other key employees.

Beginning January 1, 2022, we include guaranteed supplemental commissions ("GSCs") as part of core commissions and fees and, therefore, GSCs are a component of Organic Revenue. All current and prior periods contained within this press release have been adjusted for this treatment. GSCs are a stable source of revenue that are highly correlated to core commissions, so isolating them separately provided no meaningful incremental value in evaluating our revenue.

Beginning January 1, 2022, the following, in addition to the change in estimated acquisition earn-out payables, are excluded from certain non-GAAP measures, as we believe these amounts are not indicative of the ongoing operating performance of the business and are not easily comparable from period-to-period:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**"(Gain)/loss on disposal,"** a caption on our consolidated statements of income which reflects net proceeds received as compared to net book value related to sales of books of business and other divestiture transactions, such as the disposal of a business through sale or closure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**"Acquisition/Integration Costs,"** which represent the acquisition and integration costs (e.g., costs associated with regulatory filings, legal/accounting services, due diligence and the costs of integrating our information technology systems) arising out of our acquisitions of GRP (Jersey) Holdco Limited and its business, Orchid Underwriters Agency and CrossCover Insurance Services, and BdB Limited companies, which are not expected to occur on an ongoing basis in the future.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**The period-over-period impact of foreign currency translation ("Foreign Currency Translation")**, which is calculated by applying current-year foreign exchange rates to the various functional currencies in our business to our reporting currency of US dollars for the same period in the prior year.

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We are presenting EBITDAC - Adjusted, EBITDAC Margin - Adjusted and Diluted Net Income Per Share - Adjusted for the current and prior year periods contained within this press release so these non-GAAP financial measures compare both periods on the same basis.

**Non-GAAP Revenue Measures**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**Total Revenues - Adjusted** is our total revenues, excluding the period-over-period impact of Foreign Currency Translation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**Organic Revenue** is our core commissions and fees less: (i) the core commissions and fees earned for the first 12 months by newly acquired operations; (ii) divested business (core commissions and fees generated from offices, books of business or niches sold or terminated during the comparable period); and (iii) the period-over-period impact of Foreign Currency Translation. The term "core commissions and fees" excludes profit-sharing contingent commissions and therefore represents the revenues earned directly from specific insurance policies sold and specific fee-based services rendered. Organic Revenue can be expressed as a dollar amount or a percentage rate when describing Organic Revenue growth.

**Non-GAAP Earnings Measures**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**EBITDAC** is defined as income before interest, income taxes, depreciation, amortization and the change in estimated acquisition earn-out payables.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**EBITDAC Margin** is defined as EBITDAC divided by total revenues.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**EBITDAC - Adjusted** is defined as EBITDAC, excluding (i) (gain)/loss on disposal, (ii) Acquisition/Integration Costs and (iii) the period-over-period impact of Foreign Currency Translation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**EBITDAC Margin - Adjusted** is defined as EBITDAC - Adjusted divided by Total Revenues - Adjusted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;•**Diluted Net Income Per Share - Adjusted** is defined as diluted net income per share, excluding the after-tax impact of (i) the change in estimated acquisition earn-out payables, (ii) (gain)/loss on disposal, (iii) Acquisition/Integration Costs and (iv) the period-over-period impact of Foreign Currency Translation.

Our industry peers may provide similar supplemental non-GAAP information with respect to one or more of these measures, although they may not use the same or comparable terminology and may not make identical adjustments and, therefore comparability may be limited. This supplemental non-GAAP financial information should be considered in addition to, and not in lieu of, the Company's condensed consolidated financial statements.

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**For more information:**

R. Andrew Watts

Chief Financial Officer

(386) 239-5770

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