BRP Group Inc.

The stable outlook reflects our expectations that BRP will report revenue growth of 120%-140% (55%-65% on a pro forma basis) for 2021 supported by organic growth of 20%-21% and annualized acquired revenue of $200 million. For 2022, we forecast continued double-digit organic growth of 13%-15% and annualized acquired revenue of $100 million-$150 million. We expect topline growth and accretive acquisitions for 2021-2022 to translate into adjusted EBITDA margin expansion of 18%-22%. We expect BRP to end 2021 with pro forma debt to EBITDA of about 8.0x, deleveraging to roughly 7.0x by year-end 2022. We expect EBITDA interest coverage to remain above 3.0x over the next 12 months. We could lower our rating in the next 12 months if BRP's market

...Recent capital-markets activity has weakened BRP's credit measures. To provide capacity for further inorganic growth, BRP Group Inc. (BRP) issued a $350 million first-lien term loan add-on in December 2021 to partially repay revolver borrowings of $425 million outstanding at the time. Including annualized EBITDA contributions from new partners, estimated earnout liabilities, the December 2021 incremental add-on, and revolver borrowings of $75 million drawn for working capital purposes, pro forma leverage for the 12 months ended Sept. 30, 2021, was about 8.0x. Although leverage is trending higher than our expectations, we forecast BRP will reduce leverage to roughly 7.0x in 2022, supported by organic growth and accretive partnership activity. For the next 12 months, we expect BRP will acquire revenues at the higher end of $100 million to $150 million with activity weighted towards the back-half of 2022. Alongside aggressive acquisition growth, BRP also reported outsized organic growth in...

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