Segment Information |
Segment Information The Company has two reportable segments: Corporate Channel and Franchise Channel. The Corporate Channel consists of company-owned and financed operations with employees who are hired, trained, and managed by Goosehead. The Franchise Channel network consists of franchisee operations that are owned and managed by individual business owners. These business owners have a contractual relationship with Goosehead to use the Company's processes, systems, and back-office support team to sell insurance and manage their business. In exchange, Goosehead is entitled to an initial franchise fee and ongoing royalty fees. Allocations of contingent commissions and certain operating expenses are based on reasonable assumptions and estimates primarily using revenue, headcount and other information. The Company’s chief operating decision maker uses net income before interest, income taxes, depreciation and amortization, adjusted to exclude equity-based compensation and other non-operating items, including, among other things, certain non-cash charges and certain non-recurring or non-operating gains or losses (“Adjusted EBITDA”) as a performance measure to manage resources and make decisions about the business. Summarized financial information concerning the Company’s reportable segments is shown in the following tables (in thousands). There are no intersegment sales, only interest income and interest expense related to an intersegment line of credit, all of which eliminate in consolidation. The “Other” column includes any income and expenses not allocated to reportable segments and corporate-related items, including equity-based compensation, certain legal expenses and interest related to the note payable.
| | | | | | | | | | | | | | | | | | | | Corporate Channel | | Franchise Channel | | Other | | Total | Three months ended June 30, 2019: | | | | | | | | | Revenues: | | | | | | | | | Commissions and fees | | $ | 10,672 |
| | $ | 91 |
| | $ | — |
| | $ | 10,763 |
| Franchise revenues | | — |
| | 8,475 |
| | — |
| | 8,475 |
| Interest income | | — |
| | 148 |
| | — |
| | 148 |
| Total | | 10,672 |
| | 8,714 |
| | — |
| | 19,386 |
| Operating expenses: | | | | | | | | | Employee compensation and benefits, excluding equity-based compensation | | 5,972 |
| | 4,038 |
| | — |
| | 10,010 |
| General and administrative expenses | | 2,078 |
| | 1,531 |
| | 592 |
| | 4,201 |
| Bad debts | | 275 |
| | 207 |
| | — |
| | 482 |
| Total | | 8,325 |
| | 5,776 |
| | 592 |
| | 14,693 |
| Adjusted EBITDA | | 2,347 |
| | 2,938 |
| | (592 | ) | | 4,693 |
| Equity-based compensation | | — |
| | — |
| | (368 | ) | | (368 | ) | Interest expense | | — |
| | — |
| | (626 | ) | | (626 | ) | Depreciation and amortization | | (234 | ) | | (218 | ) | | — |
| | (452 | ) | Taxes | | — |
| | — |
| | (430 | ) | | (430 | ) | Net income (loss) | | $ | 2,113 |
| | $ | 2,720 |
| | $ | (2,016 | ) | | $ | 2,817 |
| At June 30, 2019: | | | | | | | | | Total Assets | | $ | 7,018 |
| | $ | 13,165 |
| | $ | 17,909 |
| | $ | 38,092 |
|
| | | | | | | | | | | | | | | | | | | | Corporate Channel | | Franchise Channel | | Other | | Total | Three months ended June 30, 2018: | | | | | | | | | Revenues: | | | | | | | | | Commissions and fees | | $ | 8,525 |
| | $ | 191 |
| | $ | — |
| | $ | 8,716 |
| Franchise revenues | | — |
| | 5,969 |
| | — |
| | 5,969 |
| Interest income | | — |
| | 102 |
| | — |
| | 102 |
| Total | | 8,525 |
| | 6,262 |
| | — |
| | 14,787 |
| Operating expenses: | | | | | | | | | Employee compensation and benefits, excluding equity-based compensation | | 4,609 |
| | 2,852 |
| | — |
| | 7,461 |
| General and administrative expenses | | 1,794 |
| | 1,112 |
| | 119 |
| | 3,025 |
| Bad debts | | 217 |
| | 89 |
| | — |
| | 306 |
| Total | | 6,620 |
| | 4,053 |
| | 119 |
| | 10,792 |
| Adjusted EBITDA | | 1,905 |
| | 2,209 |
| | (119 | ) | | 3,995 |
| Equity-based compensation | | — |
| | — |
| | (26,394 | ) | | (26,394 | ) | Interest expense | | — |
| | — |
| | (972 | ) | | (972 | ) | Depreciation and amortization | | (238 | ) | | (112 | ) | | — |
| | (350 | ) | Taxes | | — |
| | — |
| | (154 | ) | | (154 | ) | Net income (loss) | | $ | 1,667 |
| | $ | 2,097 |
| | $ | (27,639 | ) | | $ | (23,875 | ) | At June 30, 2018: | | | | | | | | | Total Assets | | $ | 12,824 |
| | $ | 6,147 |
| | $ | 13,045 |
| | $ | 32,016 |
|
| | | | | | | | | | | | | | | | | | | | Corporate Channel | | Franchise Channel | | Other | | Total | Six Months Ended June 30, 2019: | | | | | | | | | Revenues: | | | | | | | | | Commissions and fees | | $ | 22,627 |
| | $ | 4,306 |
| | $ | — |
| | $ | 26,933 |
| Franchise revenues | | — |
| | 15,303 |
| | — |
| | 15,303 |
| Interest income | | — |
| | 283 |
| | — |
| | 283 |
| Total | | 22,627 |
| | 19,892 |
| | — |
| | 42,519 |
| Operating expenses: | | | | | | | | | Employee compensation and benefits, excluding equity-based compensation | | 11,039 |
| | 7,795 |
| | — |
| | 18,834 |
| General and administrative expenses | | 3,980 |
| | 3,162 |
| | 1,489 |
| | 8,631 |
| Bad debts | | 516 |
| | 367 |
| | — |
| | 883 |
| Total | | 15,535 |
| | 11,324 |
| | 1,489 |
| | 28,348 |
| Adjusted EBITDA | | 7,092 |
| | 8,568 |
| | (1,489 | ) | | 14,171 |
| Equity-based compensation | | — |
| | — |
| | (735 | ) | | (735 | ) | Interest expense | | — |
| | — |
| | (1,252 | ) | | (1,252 | ) | Depreciation and amortization | | (473 | ) | | (402 | ) | | — |
| | (875 | ) | Taxes | | — |
| | — |
| | (1,174 | ) | | (1,174 | ) | Net income (loss) | | $ | 6,619 |
| | $ | 8,166 |
| | $ | (4,650 | ) | | $ | 10,135 |
| At June 30, 2019: | | | | | | | | | Total Assets | | $ | 7,018 |
| | $ | 13,165 |
| | $ | 17,909 |
| | $ | 38,092 |
|
| | | | | | | | | | | | | | | | | | | | Corporate Channel | | Franchise Channel | | Other | | Total | Six Months Ended June 30, 2018: | | | | | | | | | Revenues: | | | | | | | | | Commissions and fees | | $ | 16,381 |
| | $ | 1,931 |
| | $ | — |
| | $ | 18,312 |
| Franchise revenues | | — |
| | 10,880 |
| | — |
| | 10,880 |
| Interest income | | — |
| | 185 |
| | — |
| | 185 |
| Total | | 16,381 |
| | 12,996 |
| | — |
| | 29,377 |
| Operating expenses: | | | | | | | | | Employee compensation and benefits, excluding equity-based compensation | | 8,653 |
| | 5,643 |
| | — |
| | 14,296 |
| General and administrative expenses | | 3,422 |
| | 1,857 |
| | 120 |
| | 5,399 |
| Bad debts | | 423 |
| | 163 |
| | — |
| | 586 |
| Total | | 12,498 |
| | 7,663 |
| | 120 |
| | 20,281 |
| Adjusted EBITDA | | 3,883 |
| | 5,333 |
| | (120 | ) | | 9,096 |
| Equity-based compensation | | — |
| | — |
| | (26,394 | ) | | (26,394 | ) | Interest expense | | — |
| | — |
| | (1,968 | ) | | (1,968 | ) | Depreciation and amortization | | (474 | ) | | (213 | ) | | — |
| | (687 | ) | Taxes | | — |
| | — |
| | (154 | ) | | (154 | ) | Net income (loss) | | $ | 3,409 |
| | $ | 5,120 |
| | $ | (28,636 | ) | | $ | (20,107 | ) | At June 30, 2018: | | | | | | | | | Total Assets | | $ | 12,824 |
| | $ | 6,147 |
| | $ | 13,045 |
| | $ | 32,016 |
|
|