What You Need to Know
- Focus Financial expects to grow revenue from the $1.8 billion it reported for 2021 to about $4 billion in 2025.
- Reaching its growth targets will require Focus to increase its number of partner firms by about 50%, CEO Rudy Adolf says.
- The $161.9 million that the company raised in December gives it additional working capital flexibility to capture M&A opportunities globally.
Focus Financial Partners has set aggressive financial targets for 2025 that include more than doubling its annual revenue from the $1.8 billion for 2021 it reported on Thursday to about $4 billion in 2025, according to Rudy Adolf, the firm’s CEO, chairman and founder.
The company, meanwhile, plans to continue pursuing mergers and acquisitions, which will play a key role in that growth.
“We have made substantial progress in the evolution of our business, with the COVID crisis reinforcing the stability and resiliency of our business model,” Adolf told analysts during an earnings call on Thursday. “And we increased our 2025 financial targets to reflect this.”
In addition to the revenue target, Adolf said his company is looking to report adjusted earnings before interest, tax, depreciation and amortization of $1.1 billion and adjusted EBITDA margin of 28% in 2025, “supported by a future partnership of approximately 125 firms.”
To hit those targets in “about four years’ time requires that we more than double the size of our revenues and adjusted EBITDA, while increasing the number of partner firms we have by about 50%,” he said.
“We believe that these targets are aggressive, but achievable,” he told analysts. Focus Financial continues to “attract some of the highest quality firms in the industry, and we ended 2021 with 84 partner firms in four countries,” he said.
The company entered 2022 with “excellent momentum, extending the strong pace of activity we experienced last year [and is] working on a substantial pipeline in the U.S., Australia, Canada, and the U.K., and plan to expand into other countries,” he disclosed.