REG - Public Policy Hldg - PPHC Announces Full Year 2025 Financial Results
Today 07:00
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RNS Number : 7770X Public Policy Holding Company, Inc. 24 March 2026
Public Policy Holding Company, Inc.
("PPHC", the "Group" or the "Company")
Public Policy Holding Company, Inc. Announces Full Year 2025 Financial Results
Revenue Growth Driving Group to Record EBITDA
· Revenue of $186.5 million with organic revenue growth of 6.2%
· Record Adjusted EBITDA of $45.4 million, up 17.7% year over year, achieved at
a margin of 24.3%
· Successfully completed our $45.8 million IPO in the US and dual-listing on
Nasdaq in January 2026
· Net Debt of $26.6 million has reverted to a Net Cash position in 2026
· Completed two acquisitions in 2025, further expanding PPHC's capabilities and
geographic reach
Washington, DC - March 23, 2026 - Public Policy Holding Company, Inc. ("PPHC,"
"Company," "Group") (Nasdaq: PPHC and AIM: PPHC.L), a leading global strategic
communications provider offering a comprehensive range of advisory services in
the areas of Government Relations, Corporate Communications, and Public
Affairs, today reported unaudited financial results for the year ended
December 31, 2025 ("FY 2025").
Q4 2025 Financial Highlights
· Q4 revenue increased 27.8% over the prior period to $49.9 million, with
organic growth contributing 5.4%.
· GAAP Net Loss of $(15.2) million compared to $(6.7) million in Q4 2024.
· Adjusted EBITDA of $12.4 million, up 27.1% over the prior period, achieved at
a 24.9% margin.
· Adjusted Net Income of $11.3 million was up 66.1%.
· GAAP Basic and diluted loss per share of $(0.86) compared to $(0.46) in Q4
2024.
· Adjusted fully diluted EPS of $0.42 was up $0.15 or 58.0%.
FY 2025 Financial Highlights
· FY revenue increased 24.7% to $186.5 million, with organic growth contributing
6.2%.
· GAAP Net Loss of $(39.0) million compared to $(24.0) in 2024.
· Adjusted EBITDA of $45.4 million, up 17.7%, and achieved at a 24.3% margin.
· Adjusted Net Income of $36.6 million was up 32.1%.
· GAAP Basic and diluted loss per share of $(2.37) compared to $(2.34) in 2024.
· Adjusted fully diluted EPS of $1.39 was up $0.27 or 24.7%.
· GAAP Net Cash Provided by Operations of $24.8 million compared to $16.4
million in 2024.
· Adjusted Free Cash Flow of $36.9 million (2024: $22.2 million).
· Final dividend of $0.240 per Common Outstanding Share; total dividend for FY
2025 $0.355 per share.
Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA Incl. M&A
expense, Adjusted net income, Adjusted EPS, fully diluted, Organic Revenue
Growth, Adjusted Free Cash Flow, are non-GAAP financial measures, as defined
and reconciled below.
Stewart Hall, CEO of PPHC, commented:
"The Company's performance in 2025 was strong, with a marked uptick in organic
growth supplemented by our well-established M&A program. We have built a
diversified platform of high quality businesses that operate across the
political spectrum, giving us broad-based resilience and the ability to drive
organic revenue growth and achieve attractive margins in a volatile operating
landscape.
In 2025, our M&A program continued at pace: we acquired firms that broaden
our service offerings and extend our global reach, in line with our strategy.
We expect further strategic progress in 2026, supported by a strong and
recently enhanced balance sheet following our US IPO.
We continue to operate in a fast-moving and complex policy landscape, meaning
our clients - including nearly half of the Fortune 100 - require increasing
levels of support and continue to turn to PPHC as partner of choice. The
tailwinds driving organic growth are set to continue, positioning us well for
the balance of the fiscal year and reinforcing our longer-term outlook. "
Operational Highlights
· Significant progress in line with the Group's stated growth
strategy, with earnings accretive acquisitions providing an enhanced
complementary range of services to the Group's international client base:
o Organically, the Group recorded 6.2% growth in revenue for FY 2025,
year-on-year which represents a step-up from the 2.7% growth in FY 2024,
supported by a significant rebound in Corporate Communications and Public
Affairs.
o Acquired TrailRunner, expanding group-wide capabilities in Corporate
Communications and providing cross referral revenue opportunities.
o Acquired Pine Cove Capital, LLC (renamed "Pine Cove Strategies"), a
Texas-based strategic consulting firm, adding to the Group's state-based
government relations capabilities.
· Revenue remained highly diversified with the top 10 Group clients
representing 9.2% of revenue in 2025 versus 8.7% in 2024; and revenue mix by
segment was further diversified with Corporate Communications & Public
Affairs segment representing 34.9% in FY 2025 of total revenue (2024: 24.3%).
· By segment:
o Government Relations Consulting grew at 5.9% for FY 2025, as compared to
FY 2024 (3.6% organically compared to FY 2024).
o Corporate Communications & Public Affairs Consulting increased by
78.7% for the FY 2025, as compared to FY 2024 (8.9% organically compared to FY
2024).
o Compliance and Insights Services continued its strong growth at 21.5% for
the FY 2025, as compared to FY 2024 (reported and organic) as a result of high
renewal rates, price increases, and new clients wins, all together reflective
of a unique and high value-added offering.
· The Group grew its client base to approximately 1,400 (2024:
1,200), with representations of approximately half of the Fortune 100 in
addition to many more via trade associations; this is evidence that our
retention rates remain high.
· PPHC ended FY 2025 with 613 clients spending more than $100,000
(2024: 503 clients) and 176 spending more than $250,000 (2024: 137 clients).
Financial Outlook
Roel Smits, CFO of PPHC, commented:
"With the completion of our recent capital raise and US IPO, PPHC enters the
next phase of growth from a position of strength. Our balance sheet
flexibility allows us to pursue earnings-accretive acquisitions while our
strong cashflow allows us to continue investing in organic growth initiatives.
Momentum from Q4 has set us up well for a good start to 2026.
In general, PPHC expects to continue growing revenue at an average organic
rate of approximately 5%, and this will be supplemented by acquisitions. We
generally anticipate Adjusted EBITDA to come in at a margin around 25%,
although in 2026 we will experience the impact from assuming US public company
costs and certain technology investments.
Our focus continues to be on driving client retention rates, new business
generation, and the continued cross-selling of services across the member
companies to support organic growth prospects. Clients are increasingly
seeking integrated support to manage complex reputational, regulatory, and
stakeholder challenges.
The market for Strategic Communications services in key geographies remains
fragmented. Management continues to view the Group as a natural consolidator,
and the pipeline of acquisition opportunities under development in the U.S.,
U.K., and mainland Europe remains robust. The Group is actively seeking to
expand its portfolio of member companies internationally with strategically
and financially attractive opportunities while adding complementary
specializations."
Conference Call Webcast Information
PPHC management will host a conference call to discuss the Company's financial
results today at 4:30 p.m. Eastern Time. The call will be led by Stewart Hall,
Chief Executive Officer, Roel Smits, Chief Financial Officer, and Thomas
Gensemer, Chief Strategy Officer.
Date: Monday, March 23, 2026
Time: 4:30 p.m. Eastern Time
Webcast: Participants may access the conference call via live webcast at
https://edge.media-server.com/mmc/p/hqweq9hx/
(https://edge.media-server.com/mmc/p/hqweq9hx/) .
Dial-in: To participate via telephone, please register in advance and receive
a unique PIN at
https://register-conf.media-server.com/register/BI23772b4493ce4ac6b83992079c865d5f
(https://register-conf.media-server.com/register/BI23772b4493ce4ac6b83992079c865d5f)
A replay of the webcast of the conference call will be available on the
Investor Relations section of the Company's website at
investors.pphcompany.com (https://investors.pphcompany.com/) .
Enquiries
Public Policy Holding Company, Inc. +1 (202) 688 0020
Stewart Hall, CEO
Roel Smits, CFO
Stifel (Nominated Adviser & Joint Broker) +44 (0) 20 7710 7600
Fred Walsh, Brough Ransom, Ben Good, Daniel Dearden Williams
Canaccord Genuity (Joint Broker) +44 (0) 20 7523 8000
Simon Bridges, Andrew Potts
Burson Buchanan (Media Enquiries) +44 (0) 20 7466 5000
Helen Tarbet, Toto Berger, Jesse McNab pphc@buchanan.uk.com
About PPHC
Incorporated in 2014, PPHC is a global government relations, public affairs
and strategic communications group providing clients with a fully integrated
and comprehensive range of services including government and public relations,
research, and digital advocacy campaigns. Engaged by approximately 1,400
clients, including companies, trade associations and non-governmental
organizations the Group is active in all major sectors of the economy,
including healthcare and pharmaceuticals, financial services, energy,
technology, telecoms and transportation. PPHC's services support clients to
enhance and defend their reputations, advance policy goals, manage regulatory
risk, and engage with federal and state-level policy makers, stakeholders,
media, and the public.
For more information, see www.pphcompany.com
Operational Review
Introduction
The Group made significant progress in 2025, combining organic growth with two
strategically important, earnings-accretive acquisitions. The integration of
our Q2 2025 acquisition of TrailRunner International significantly enhances
our global corporate communications capabilities, while the addition of our Q3
2025 acquisition of Pine Cove Strategies further strengthens our Government
Relations presence in the State of Texas, together advancing our mission to
deliver strategic communications services at greater scale, breadth, and
sophistication.
As of December 31, 2025, the Group had approximately 1,400 clients. Every year
approximately 77% of these clients renew their relationship with the Group,
leading to revenue retention of approximately 86%, demonstrating the strength
of the Group's services, client relationships, and the quality of our
earnings.
A key focus of the Group remains on retained clients with greater annual
spending above certain thresholds. PPHC ended FY 2025 with 613 clients
spending more than $100,000 (2024: 503 clients) and 176 spending more than
$250,000 (2024: 137 clients). This increase was supported by a variety of
factors, including increasing cross-company client development, PPHC's
internal referral awards system, and compensation programs that are based on
Group-wide performance. In January 2025, we were pleased to appoint John Green
as Chief Client Officer, a new role underscoring PPHC's commitment to
maximizing cross-firm collaboration.
In FY 2025, the Group directly represented close to half of the Fortune 100,
in addition to many more via their trade associations that the Group serves.
Financial Review
Certain monetary amounts, percentages and other figures included elsewhere in
this earnings release have been subject to rounding adjustments. Accordingly,
figures shown as totals in certain tables or charts may not be the arithmetic
aggregation of the figures that precede them, and figures expressed as
percentages in the text may not total 100% or, as applicable, when aggregated
may not be the arithmetic aggregation of the percentages that precede them.
Adjusted Profit & Loss Statement
(Amounts in millions, except per share data)
Three months ended December 31, Years Ended December 31,
2025 2024 $ Change % Change 2025 2024 $ Change % Change
Revenue $49.9 $39.0 $10.8 27.8% $ 186.5 $149.6 $36.9 24.7%
GAAP Net loss $(15.2) $(6.7) $(8.6) 128.3% $(39.0) $(24.0) $(15.0) 62.8%
Adjusted EBITDA $12.4 $9.8 $2.7 27.1% $45.4 $38.6 $6.8 17.7%
Adjusted EBITDA margin 24.9% 25.0% (0.1)pts 24.3% 25.8% (1.5)pts
M&A expense $(0.4) $(0.8) $0.3 (44.7)% $(0.8) $(2.4) $1.6 (65.6)%
Adjusted EBITDA incl M&A expense $12.0 $9.0 $3.0 33.4% $44.5 $36.1 $8.4 23.3%
Depreciation $- $- $- 27.1% $(0.2) $(0.1) $(0.1) 73.5%
Adjusted EBIT $11.9 $9.0 $3.0 33.4% $44.4 $36.0 $8.4 23.3%
Interest $(0.9) $(0.5) $(0.4) 80.4% $(3.3) $(1.7) $(1.6) 92.8%
Adjusted EBT $11.0 $8.4 $2.6 30.5% $41.0 $34.3 $6.7 19.5%
Taxes $0.3 $(1.7) $1.9 (115.9)% $(4.4) $(6.5) $2.1 (32.1)%
Effective tax rate (2.4)% 19.6% (21.9)pts 10.7% 19.1% (8.4)pts
Adjusted Net Income $11.3 $6.8 $4.5 66.1% $36.6 $27.7 $8.9 32.1%
Adjusted Net Income margin 22.6% 17.4% 5.2pts 19.6% 18.5% 1.1pts
GAAP basic and diluted loss per share (0.86) (0.46) (0.40) 86.6% (2.37) (2.34) (0.03) 1.4%
Adjusted EPS ($) (basic) 0.45 0.28 0.17 58.5% 1.48 1.17 0.31 26.4%
Adjusted EPS ($) (fully diluted) 0.42 0.27 0.15 58.0% 1.39 1.11 0.27 24.7%
Dividend paid, per share 0.221 0.262 (0.041) (15.6)% 0.344 0.702 (0.358) (51.0)%
Bridge from Adjusted to Reported Results
(Amounts in millions)
Three months ended December 31, Years Ended December 31,
2025 2024 $ Change % Change 2025 2024 $ Change % Change
Adjusted Net Income $11.3 $6.8 $4.5 66.1% $36.6 $27.7 $8.9 32.1%
Share-based accounting charge 7.4 8.0 (0.6) (7.0)% 29.6 31.8 (2.2) (6.8) %
M&A: Post-combination comp 8.5 2.9 5.7 198.5% 21.3 11.6 9.7 83.4%
M&A: bargain purchase (2.0) - - (2.0) - (2.0) (2.5) 0.4 (17.1)%
M&A: change in contingent consideration 0.2 - 0.1 0.1 39.5% 5.1 1.9 3.2 169.5%
Long Term Incentive Program charges 2.5 1.2 1.3 105.2% 7.1 4.2 2.9 70.3%
Amortization intangibles 1.5 1.3 0.1 11.5% 6.0 4.7 1.4 29.4%
Loss on impairment of intangible assets $2.9 $- $2.9 - $2.9 $- $2.9 -
Loss on impairment of goodwill $6.2 $- $6.2 - $6.2 $- $6.2 -
Other income, net $(0.6) $- $(0.6) - $(0.6) $- $(0.6) -
Net Income (Reported) $(15.2) $(6.7) $(8.6) 128.3% $(39.0) $(24.0) $(15.0) 62.8%
Management reviews the progress and performance of its business on the basis
of the Adjusted Net Income shown above. The items excluded from the Adjusted
Net Income above, while included in our GAAP results, have been shown in the
Bridge above. These excluded items do not have a cash impact nor do they
reflect ongoing performance of the underlying business. Please refer to the
section 'basis of preparation' for a discussion of each of the non-cash items
excluded from Adjusted Net Income.
Please note that, during Q2 2025, the Company redefined its Underlying EBITDA
definition to be Adjusted EBITDA. Adjusted EBITDA excludes expenses related to
M&A transactions (which includes M&A related advisory fees, debt
origination, and transaction taxes) as follows:
(Amounts in millions)
Three months ended December 31, Years ended December 31,
Old Definition New Definition 2025 2024 2025 2024
Underlying EBITDA EBITDA including M&A $12.0 $9.0 $44.5 $36.1
Remove: M&A Expenses M&A Expenses 0.4 0.8 0.8 2.4
Adjusted EBITDA EBITDA excluding M&A $12.4 $9.8 $45.3 $38.6
M&A expenses were $0.8 million for the year ended December 31, 2025, down
from $2.4 million in 2024, with 2024 reflecting a substantial investment in
M&A expenses driven by the first international acquisition performed by
PPHC as well as debt acquisition charges. For its acquisitions in 2025, the
Company utilized less external resources and was able to build off the
international platform created in 2024.
Revenue
($ in millions, except percentages)
Three months ended December 31,
2025 2024
Revenue from acquisitions Organic revenue Total revenue Total revenue Organic Revenue Growth((1)) Total Growth
Government Relations Consulting $0.8 $26.8 $27.6 $25.9 3.6% 6.6%
Corporate Communications & Public Affairs Consulting 7.9 10.9 18.9 10.4 5.5% 82.1%
Compliance and Insights Services - 3.4 3.4 2.8 22.6% 22.6%
Total $8.7 $41.1 $49.9 $39.0 5.4% 27.8%
($ in millions, except percentages)
Years ended December 31,
2025 2024
Revenue from acquisitions Organic revenue Total revenue Total revenue Organic Revenue Growth((1)) Total Growth
Government Relations Consulting $2.3 $106.2 $108.5 $102.5 3.6% 5.9%
Corporate Communications & Public Affairs Consulting 25.4 39.7 65.1 36.4 8.9% 78.7%
Compliance and Insights Services - 13.0 13.0 10.7 21.5% 21.5%
Total $27.7 $158.9 $186.5 $149.6 6.2% 24.7%
($ in millions, except percentages)
Three months ended December 31, Years ended December 31,
2025 2024 $ change % change 2025 2024 $ change % change
United States $47.3 $37.3 $10.0 26.8% $177.6 $145.5 $32.1 22.1%
International 2.5 1.7 0.8 49.6% 8.9 4.1 4.8 117.1%
Revenue by geographic market $49.9 $39.0 $10.8 27.8% $186.5 $149.6 $36.9 24.7%
The Group's total revenue for the three and twelve months ended December 31,
2025 increased by 27.8% and 24.7% to $49.9 million and $186.5 million,
respectively, as compared to $39.0 million and $149.6 million reported for the
same periods in 2024. The organic growth rate was 5.4% and 6.2% as compared to
the same periods in 2024, demonstrating the stability of the Group's core
business operations, the dedication of our management teams across our member
companies, and the critical importance of our work to our clients, with the
remainder of growth driven by the successful integration of Lucas Public
Affairs, Pagefield Communications (acquisitions completed in Q2 2024) which
are now meaningfully contributing to the Group's financial performance,
TrailRunner International (completed in Q2 2025), and Pine Cove Strategies
(completed in Q3 2025).
Organic growth of 5.4% and 6.2% for the three and twelve months ended December
31, 2025, respectively, was the outcome of continued organic growth in
Government Relations at 3.6% and 3.6%, Corporate Communications & Public
Affairs at 5.5% and 8.9% and Compliance and Insights Services at 22.6% and
21.5%.
During the three and twelve months ended December 31, 2025, 55.3% and 58.1%,
respectively, of the Group's revenues stemmed from Government Relations as
compared to the same periods in 2024 of 66.3% and 68.5%, 37.9% and 34.9% came
from Corporate Communications & Public Affairs as compared to the same
periods in 2024 of 26.6% and 24.3%, and 6.9% and 7.0% from Compliance and
Insights Services as compared to the same periods in 2024 of 7.2%.
The Group's revenue realized outside of the US was $2.5 million, or 5.1%, and
$8.9 million, or 4.8%, for the three and twelve months ended December 31,
2025, respectively, as compared to $1.7 million, or 4.4%, and $4.1 million, or
2.7%, for the three and twelve months ended December 31, 2024, respectively.
Profit
Long-term Profit
(dollars in millions)
FY FY FY FY
2022 2023 2024 2025
GAAP Net loss $(15.0) $(14.2) $(24.0) $(39.0)
Adjusted EBITDA $31.5 $35.4 $38.6 $45.4
Adjusted EBITDA margin 29.0% 26.2% 25.8% 24.3%
GAAP Net losses increased from $(24.0) million in 2024 to $(39.0) million in
2025, the losses primarily being the result of a $29.6 million share based
accounting charge stemming from the UK IPO and the treatment of acquisitions
in our accounts. The increase in loss in 2025 was driven by a $9.7 million
increase in post-combination compensation charges primarily stemming from the
Lucas, Pagefield, TrailRunner and Pine Cove acquisitions, a $9.1 million
impairment charge related to Pagefield's intangibles and goodwill, and an
increase of $3.2 million in the change in fair value of contingent
consideration.
Adjusted EBITDA for the three and twelve months ended December 31, 2025 of
$12.4 million and $45.4 million, up 27.1% and 17.7% from the same periods in
2024, was achieved at a margin of 24.9% and 24.3%, close to the Group's
historic performance, while reflecting the change in businesses mix with
highly profitable Government Relations activities reducing in relative weight,
as well as a partial restoration of the bonus pool.
Revenue and Profit by Segment ($ in millions)
Three months ended December 31, Years ended December 31,
2025 2024 % variance 2025 2024 % variance
Government Relations
Revenue $27.6 $25.9 6.6% $108.5 $102.5 5.9%
Segment Adjusted pre-bonus EBITDA 12.8 11.5 10.8% $48.5 $46.9 3.4%
Segment Adjusted pre-bonus EBITDA margin 46.3% 44.6% 1.8pts 44.7% 45.8% (1.1) pts
Corporate Communications and Public Affairs
Revenue $18.9 $10.4 82.1% $65.1 $36.4 78.7%
Segment Adjusted pre-bonus EBITDA $6.1 $2.8 117.5% $18.8 $7.8 141.7%
Segment Adjusted pre-bonus EBITDA margin 32.3% 27.0 % 5.3pts 28.9% 21.4% 7.5pts
Compliance and Insights Services
Revenue $3.4 $2.8 22.6% $13.0 $10.7 21.5%
Segment Adjusted pre-bonus EBITDA $1.9 $1.4 42.1% $7.1 $5.1 39.5%
Segment Adjusted pre-bonus EBITDA margin 56.0% 48.3% 7.7pts 54.7% 47.7% 7.0pts
Total
Revenue $49.9 $39.0 27.8% $186.5 $149.6 24.7%
Segment Adjusted pre-bonus EBITDA $20.8 $15.7 32.6% $74.5 $59.8 24.5%
Segment Adjusted pre-bonus EBITDA margin 41.7% 40.2% 1.5pts 39.9% 40.0% (0.1) pts
Non-allocated Bonus (5.5) (3.3) 67.8% (16.7) (10.4) 61.1%
Non-allocated Corporate costs (2.8) (2.6) 8.1% (12.4) (10.9) 13.6%
Adjusted EBITDA 12.4 9.8 27.2% 45.4 38.6 17.7%
Adjusted EBITDA Margin 24.9% 25.0% (0.1) pts 24.3% 25.8% (1.5) pts
GAAP Net loss (15.2) (6.7) 128.3% (39.0) (24.0) 62.8%
In Government Relations, revenue has increased by 5.9% in the year ended
December 31, 2025 as a consequence of continued organic growth in tandem with
the acquisitions of Pagefield (2024 Q2) and Pine Cove Strategies (2025 Q3).
The margin of Segment Adjusted pre-bonus EBITDA remained relatively stable at
44.7%, reflecting the stable pricing of retainer contracts both at U.S.
Federal and State level.
In Corporate Communications and Public Affairs, revenue has increased by 78.7%
in the year ended December 31, 2025 as a consequence of continued strong
organic growth, rebounding from a slower first six months in 2024, in tandem
with the acquisitions of Pagefield, Lucas Public Affairs (both 2024 Q2) and
Trailrunner International (2025 Q2) . The margin of Segment Adjusted pre-bonus
EBITDA increased significantly from 21.4% in 2024 to 28.9% in 2025, reflecting
the operating leverage effects of realizing higher revenues, although still
operating at margins that are lower than the Group's average.
In Compliance and Insights Services, revenue has increased by 21.5% in the
year ended December 31, 2025 as a consequence of continued strong organic
growth. The margin of Segment Adjusted pre-bonus EBITDA further improved to
54.7%, reflecting the strong pricing of subscription contracts in this area,
in combination with the increased use of technology in servicing our clients.
Non-allocated Bonus went up from $10.4 million to 16.7 million in the year
ended December 31, 2025, as a result of the growth in pre-bonus EBITDA as well
as the restoring of the bonus pool
Non-allocated Corporate costs went up from $10.9 million to $12.4 million in
the year ended December 31, 2025, as a result of the building of a robust
central platform for supporting our clients, the dual listing, our further
growing group of member companies, Also external advisory costs increased as a
consequence of these same factors.
After interest and taxes, the Group's Adjusted Net Income for the year ended
December 31, 2025 amounted to $36.6 million, up 32.1% from $27.7 million in
2024.
Other
The Group's net finance costs for the year ended December 31, 2025 were $3.3
million as compared to 2024 of $1.7 million, reflecting the inclusion of
additional debt on the Group's balance sheet for the acquisitions of Lucas
Public Affairs and Pagefield in Q2 2024, and TrailRunner in Q2 2025.
The income tax (expense) benefit tax accrual for the year ended December 31,
2025 was $4.4 million as compared to $6.5 million in 2024, which represents a
blended effective tax charge of 10.7% for the year ended December 31, 2025 to
Adjusted Profit before Tax. This rate represents a substantial improvement
over the 19.1% effective rate in 2024. The reduction was driven by structural
and temporary differences between tax accounting and GAAP accounting. At a
high level, the two primary driving factors are amortization of goodwill for
tax purposes and the vesting of long-term incentive program ("LTIP")
compensation.
The Group ended 2024 with 367 employees and at December 31, 2025 this had
increased to 450, primarily as a result of the acquisition of TrailRunner. The
Group's average employee count during the year ended December 31, 2025 was 426
(2024: 349).
Cash Flow
PPHC's GAAP Cash Flow statement as presented below on page 22 of this earnings
release, has certain acquisition-related payments included in the Cash
provided by Operating Activities and in the Cash provided by Financing
Activities, as a consequence of certain acquisition payments being made
subject to continued employment.
In an effort to also provide a more traditional picture of our Cash Flow
build-up, we provide a calculation of Adjusted Free Cash Flow as well as an
Alternative Cash Flow Statement that ties abovementioned Adjusted Free Cash
Flow to the final movement on the balance sheet.
The Group recorded Adjusted Free Cash Flow of $36.9 million for the year ended
December 31, 2025 as compared to $22.2 million in 2024. In general, the
generation of Adjusted Free Cash Flow tends to be weighted towards the second
half of the year, as a consequence of the payment of annual bonuses in the
first half year.
Conversion Cash flow from Operations to Adjusted Free Cash Flow
(Amount in millions, except percentages)
Years Ended December 31,
2025 2024 $ Change % Change
Net cash provided by Operating Activities - as reported $24.8 $16.4 $8.4 51.0%
Prepaid post-combination expense 10.5 4.6 5.8 125.4%
Change in other liability 1.7 1.0 0.7 74.6%
Change in contingent consideration - 0.3 (0.3) (98.5)%
Acquisition Payments included in Cash flow from Operations 12.2 5.9 6.3 106.7%
Capex - (0.1) - (80.3)%
Adjusted Free Cash Flow $36.9 $22.2 $14.7 66.1%
As is typical for the Group, the primary uses of cash are acquisition payments
and dividends.
Cash outflows related to acquisitions increased from $26.4 million in 2024 to
$33.8 million in 2025, with the 2025 outflow resulting from the completion
payments for TrailRunner International and Pine Cove Strategies in combination
with an earnout payment for KP Public Affairs. The 2024 outlay was driven by
the acquisition payments for Lucas Public Affairs and Pagefield, in addition
to an earnout payment for MultiState.
Dividend payments reduced from $16.8 million in 2024 to $8.7 million in 2025.
The reduction in dividend reflects the new dividend policy which was announced
in January 2025.
Summary of Cash Uses and Sources
(Amount in millions, except percentages)
Years Ended December 31,
2025 2024 $ Change % Change
Adjusted Free Cash Flow $36.9 $22.2 $14.7 66.1%
Cash paid for acquisitions, net of cash acquired (21.1) (19.8) (1.3) 6.5%
Acquisition Payments included in Cash flow from Operations (12.2) (5.9) (6.3) 106.7%
Acquisition Payments included in Cash flow from Financing (0.6) (0.8) 0.2 (22.4)%
Cash flow related to acquisitions (33.8) (26.4) (7.4) 28.0%
Proceeds from notes payable 24.0 25.0 (1.0) (4.0)%
Payment of debt issuance costs (0.1) (0.2) 0.1 (40.5)%
Loan issued to related parties (0.5) - (0.5) -
Proceeds received for notes receivable - related parties - 0.4 (0.4) (100.0)%
Principal payment of note payable (9.2) (3.9) (5.3) 137.3%
Cash Flow related to debt financing 14.2 21.3 (7.1) (33.2)%
Dividends paid (8.7) (16.8) 8.2 (48.6)%
Payment of deferred equity offering costs (2.9) - (2.9) -
Cash Flow related to equity financing (11.6) (16.8) 5.3 (31.2)%
Effect of foreign exchange rate changes on cash and cash equivalents 0.2 (0.1) 0.2 (388.9)%
Net Cash Movement $5.9 $0.2 $5.7 2,925.6%
Net debt position
PPHC's debt position at December 31, 2025 of $47.0 million offset by cash of
$20.4 million, resulted in a Net Debt position of $26.6 million as compared to
a Net Debt position of $17.5 million at December 31, 2024. The increase in Net
Debt related to the acquisition of TrailRunner in the second quarter of 2025.
(Amounts in millions, except percentages)
December 31,
2025 2024 % Change $ Change
Cash and cash equivalents as of end of period $20.4 $14.5 40.6% $5.9
Notes payable, long-term, net (37.9) (26.0) 45.7% (11.9)
Notes payable, current portion, net (9.1) (6.0) 50.6% (3.1)
Total Debt $(47.0) $(32.0) 46.6% $(14.9)
Net debt at period-end $(26.6) $(17.5) 51.6% $(9.0)
Earnout obligations
As part of the typical structure applied for the acquisitions that were
completed post-UK IPO, the Group also committed to making certain contingent
earnout payments. These earnout payments are based on a profit-driven formula
and only materialize if the acquired company realizes profit growth after the
date of completion. Payments are typically made in a mix of cash and shares.
In turn, each of these components of earnout payments may be subject to
further vesting requirements and employment conditions, which keeps the
recipients financially committed to the Group.
In relation to these earnout payments, the Group has liabilities recorded of
$25.0 million on its balance sheet, spread across the 'Contingent
Consideration' and 'Other Liabilities' line items. This number is a reflection
not only of the estimated foreseen nominal payments, but also of discount
factors and fair value estimates.
The liabilities accrued under 'Contingent Consideration' relate to regular
M&A payments, whilst the liabilities accrued under "Other Liabilities"
relate to those M&A payments that have 'continued employment' requirements
and are therefore subject to 'clawback' provisions.
In nominal terms, over the period 2025-2030, based on expected performance of
each of the acquired companies, management anticipates having to make earnout
payments of $78.3 million, of which $44.6 million payable in cash and the
remainder in shares.
The maximum earnout liability over that same period, which would only be
reached if each acquisition meets very aggressive profit growth targets, would
be $141.9 million, of which $83.7 million payable in cash and the remainder in
shares. Generally, in order for an acquisition to reach maximum earnout
payments, it would need to grow its profit by 25-30% annually over the entire
earnout period.
Expected Earnout Liabilities - in Nominal Terms
($ in millions)
2026 2027 2028 2029 2030 Total
Expected earnout payments in Cash $12.0 $4.6 $22.8 $1.3 $3.9 $44.6
Expected earnout payments in PPHC stock 4.6 1.7 22.8 0.8 3.9 33.7
Expected earnout payments - total $16.6 $6.3 $45.5 $2.1 $7.9 $78.3
Maximum earnout payments in Cash $17.5 $15.4 $22.8 $18.0 $10.0 $83.7
Maximum earnout payments in PPHC stock 7.5 6.9 22.8 11.0 10.0 58.2
Maximum earnout payments - total $25.0 $22.4 $45.5 $29.0 $20.0 $141.9
Dividend
The Company's board of directors have declared a total dividend for 2025 of
$0.355 per Common Stock, which equates to an aggregate amount, based on the
anticipated number of outstanding Common Stock, of approximately $9.7 million.
Because $0.115 per Common Stock was paid as interim dividend in October 2025,
a final dividend of $0.240 per Common Stock remains payable to the holders of
record of all the issued and outstanding shares of the Company's Common Stock
as of the close of business on the record date, April 24, 2026.
The ex-dividend date for shares of the Company's Common Stock traded on AIM is
April 23, 2026, and for shares of the Company's Common Stock traded on Nasdaq,
the ex-dividend date is April 22, 2026. The final dividend will be paid no
later than May 22, 2026.
This proposed final dividend reflects the intended dividend reduction
announced in January 2025, aimed at retaining more of the Group's strong cash
flow, and enabling the Group to continue pursuing accretive M&A and drive
long-term growth. Information per Share
Share count in thousands
Years ended December 31,
2025 2024 Share count % Change
/ $ Change
# of shares period end - GAAP - basic and fully diluted 20,822 16,884 3,938 23.3%
# of shares period end - Legally outstanding - basic 25,174 24,018 1,157 4.8%
# of shares period end - Legally outstanding - fully diluted 26,868 25,564 1,305 5.1%
# weighted avg shares - GAAP - basic and fully diluted 17,467 13,409 4,058 30.3%
# weighted avg shares - Legally outstanding - basic 24,775 23,641 1,134 4.8%
# weighted avg shares - Legally outstanding - fully diluted 26,439 24,954 1,485 5.9%
EPS - GAAP reported (basic and fully diluted) $(2.37) $(2.34) $(0.03) 1.4%
Adjusted EPS - basic $1.48 $1.17 $0.31 26.4%
Adjusted EPS - fully diluted $1.39 $1.11 $0.27 24.7%
Dividend paid - per share $0.344 $0.702 $(0.358) (51.0)%
Adjusted Free Cash Flow per share $1.49 $0.94 $0.55 58.5%
For the purpose of giving investors a useful view on Earnings Per Share
("EPS"), the Group computed EPS not only on a GAAP Reported Profit basis, but
also on an Adjusted Net Income basis. For the latter calculation the Group
includes in the denominator the legally outstanding number of shares. This
definition not only includes the common shares outstanding, but also (i)
unvested portion of the pre-UK IPO Retained Shares, (ii) unvested shares that
have been issued in relation to post-IPO acquisitions, and (iii) unvested
Restricted Stock Awards. While those shares are still subject to vesting
rules, and therefore not part of the Common Outstanding share count per GAAP
definition, they entitle the recipients to dividends and voting rights.
Note that the growth in weighted of average number of shares for the year
ended December 31, 2025 (4.8% basic, 5.9% fully diluted) was driven by annual
LTIP issuance as well as M&A related issuances.
(Subsequent to period close, due to the Company's U.S. public offering in
January 2026, the number of outstanding shares has increased by 3,400,000
shares.)
Safe Harbor Statement Under the Private Securities Litigation Reform Act of
1995
Forward-Looking Statements
This earnings release contains "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Such forward looking
statements involve risks and uncertainties. Forward-looking statements are
often identified by words such as "anticipate," "believe," "could,"
"estimate," "expect," "intend," "may," "might," "plan," "potential,"
"predict," "project," "should," "target," "will," "would," and similar
expressions, or the negative of these terms or other comparable terminology.
These statements include, but are not limited to, statements regarding the
Company's future financial performance, business strategy, market
opportunities, anticipated financial position, liquidity and capital needs,
and other statements that are not historical facts. These statements are based
on various assumptions, whether or not identified in this earnings release,
and on the current expectations and assumptions of the Company's management,
which are inherently subject to uncertainties, risks and changes in
circumstances that are difficult to predict, including as detailed in our
filings with the Securities and Exchange Commission (the "SEC"). Moreover, we
operate in a very competitive and rapidly changing environment and new risks
emerge from time to time. It is not possible for our management to predict all
risks, many of which are outside the control of the Company, nor can we assess
the impact of all factors on our business or the extent to which any factor,
or combination of factors, may cause actual results to differ materially from
those discussed in the forward-looking statements. In light of these risks,
uncertainties and assumptions, the future events and trends discussed in this
earnings release may not occur and actual results could differ materially and
adversely from those anticipated or implied in the forward-looking statements
and we cannot guarantee any future performance, conditions or results. We
undertake no obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or otherwise, except as
required by law. Given these risks and uncertainties, readers are cautioned
not to place undue reliance on such forward-looking statements. Copies or our
filings with the SEC can be found on our investor relations website
(investors.pphcompany.com (https://investors.pphcompany.com/) ) or on the SEC
website (www.sec.gov
(https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.sec.gov%2F&data=05%7C02%7Cmary.abbott%40pphcompany.com%7C88ecf088c1c7410b4a0208de85c70bf0%7Cd89047a20db846939b061697f2e8c9b8%7C0%7C0%7C639095287121988764%7CUnknown%7CTWFpbGZsb3d8eyJFbXB0eU1hcGkiOnRydWUsIlYiOiIwLjAuMDAwMCIsIlAiOiJXaW4zMiIsIkFOIjoiTWFpbCIsIldUIjoyfQ%3D%3D%7C0%7C%7C%7C&sdata=TtmWa7gP%2B7houhiy3LC3O5Bkyxl5iVwMO9pIHQTSkvw%3D&reserved=0)
).
Industry Information
Market data and estimates used throughout this earnings release are based on
information from independent third parties and other publicly available
information in addition to management's internal estimates. Such data involves
a number of assumptions and limitations, and you are cautioned not to give
undue weight to such estimates. No representations or warranties are made by
the Company or any of its affiliates as to the accuracy of any such
information. Projections, assumptions and estimates of the future performance
of the industry in which the Company operates are necessarily subject to a
high degree of uncertainty and risk due to a variety of factors. These and
other factors could cause results to differ materially from those expressed in
management's estimates and beliefs and in the estimates prepared by
independent parties.
Basis of preparation
The financial statements have been prepared in accordance with Generally
Accepted Accounting Principles in the United States ("U.S. GAAP" or "GAAP").
When the Company purchases services or goods on behalf of its clients (for
example in the case of media purchases), the Group does not recognize the
purchased goods as net revenue, but only the net fees earned on the purchases.
Therefore, purchases on behalf of clients do not materially impact the
top-line or the margins.
Management believes that Adjusted EBITDA and Adjusted Net Income are more
useful performance indicators than the reported Net Income. The following
elements distinguish our Adjusted Net Income from our Reported Net Income:
(1) Share-based accounting charge: As mentioned in all prior filings and
annual reports, shares issued to employee shareholders at the time of the
London 2021 IPO are subject to a vesting schedule. In addition, their
employment agreements contain certain provisions which enable cash derived
from the sale of shares at the time of the London 2021 IPO to be clawed back
and forfeited on certain events of termination of employment. These items
create a non-cash share-based accounting charge in accordance with guidance
under U.S. GAAP, Accounting Standards Codification, 718- 10-S99-2,
"Compensation-Stock Compensation". Based on the value of the Company at the
time of admission ($197 million) and the pre-admission employee shares sold in
2021, for the three and twelve months ending December 31, 2025, the non-cash
charge are $7.4 million and $29.6 million (2024: $8.0 million and $31.8
million). This non-cash share-based charge has no impact on tax, nor share
count or Company operations.
(2) Post-combination compensation charge: In the acquisitions that have
been completed since the IPO in 2021, the Group makes payments in cash and
shares. In order to protect the interests of the Group, the shares issued as
part of these transactions were made subject to vesting schedules. To a
similar degree, also the cash paid as part of these transactions can be clawed
back and forfeited on certain events of termination of employment.
The addition of these provisions to purchase price paid creates a
post-combination compensation charge in accordance with accounting guidance
under U.S. GAAP, Accounting Standards Codification, ASC 805-10-55-25,
"Business Combinations - Contingent Payments". For the three and twelve months
ending December 31, 2025 the non-cash charges were $8.5 million and $21.3
million (2024: $2.9 million and $11.6 million). Again, this is a non-cash
charge and has no impact on either tax or Company operations.
(3) LTIP charges. In 2022 the Group issued the first stock-based
compensation units under the Omnibus Plan. This plan was introduced at the
time of the London 2021 IPO and allows the Group to issue up to a certain
number of stock-related units (e.g. options, restricted stock). In the year
ended December 31, 2025, PPHC issued 62,588 ( 2024: 85,000) stock options at a
premium exercise price (market price at time of grant plus 20%), exercisable
at the 3(rd) anniversary of the grant. Also, the Group issued 498,532
restricted stock units (2024: 586,000), and 195,593 restricted stock awards
(2024: 140,748). Similar to 2024, no restricted stock appreciation awards were
awarded in 2025 as these instruments are getting phased out. The charges
relating to these issuances were $7.1 million in the year ended December 31,
2025 (2024: $4.2 million), and those were computed using the Black Scholes
method.
(4) Amortization of intangibles: The non-cash amortization charge of $1.5
million and $6.0 million for the three and twelve months ending December 31,
2025 (2024: $1.3 million and $4.7 million) relates to the amortization of
customer relationships, developed technology, and noncompete agreements per
ASC 805.
(5) Bargain purchase: As laid out in point 2, because a significant part
of the purchase price of our acquisitions is tied to continued employment,
this part has been accounted for as post-combination compensation in the
Group's Consolidated Statements of Operations. As a consequence, for certain
acquisitions, the remaining book purchase price is lower than the tax purchase
price. The reason for the bargain purchase gain is tied directly to the tax
purchase price significantly exceeding the book purchase price and is not a
reflection of a true bargain purchase of the actual intangible and tangible
assets of these acquisitions. The income recorded relating to the bargain
purchase was $2.0 million in the three and twelve months ending December 31,
2025 (2024: zero and $2.5 million).
(6) Change in Contingent Consideration: The contingent consideration
liability recorded as part of the acquisitions is adjusted at each reporting
period for the change in the estimated fair value of that liability. The fair
value changes over time based on management assumptions, the passage of time,
payments made, and other external inputs, such as discount rates and
volatility. The change in the estimated fair value of the contingent
consideration is recorded as a non-operating expense of $0.2 million and $5.1
million in the three and twelve months ending December 31, 2025 (2024: $0.1
million and $1.9 million).
(7) Loss from Impairment: Based on the results of the Company's
qualitative assessment performed for our indefinite-lived assets, as of
October 1, 2025, we determined that the effects of the decline in operations
was a result of certain client relationships and employee turnover at
Pagefield constituted a triggering event for both the Pagefield Government
Relations Consulting reporting unit and the Pagefield Corporate Communications
& Public Affairs reporting unit. We conducted our annual test of the fair
value of the Pagefield acquisition's goodwill. We applied the discounted cash
flow method and the guideline public company method to determine the fair
value of both reporting units. The results of this approach indicated that the
Pagefield Government Relations Consulting reporting unit's carrying value
exceeded its fair value by 55.9% and the Pagefield Corporate Communications
& Public Affairs reporting unit's carrying value exceeded its fair value
by 21.1%. We therefore concluded that a portion of the goodwill was impaired
as of December 31, 2025 and recorded non-cash impairment charges of $4.8
million to the Pagefield Government Relations Consulting reporting unit and
$1.5 million to the Pagefield Corporate Communications & Public Affairs
reporting unit. No goodwill of indefinite-lived intangible asset was
impairment for the year ended December 31, 2024. Additionally, based on the
results of the Company's qualitative assessment performed on our
definite-lived assets which consist of customer relationships, developed
technology and non-compete agreements that have been acquired through various
acquisitions, we concluded that a portion of the trade names and customer
relationships was impaired as of December 31, 2025 and recorded a non-cash
impairment charges of $0.3 million and $2.6 million, respectively. The Company
has not recorded any impairment charges related to long-lived assets for the
year ended December 31, 2024.
(8) M&A expenses: since Q2 2025 reporting, the Group has been
excluding M&A expenses from the Adjusted EBITDA. M&A expenses have a
one-off character because expenses are incurred around the time the Group
executes an acquisition. Expenses typically exists of M&A advisory fees,
debt origination costs, and transaction related taxes. The M&A expenses in
the three and twelve months ending December 31, 2025 amounted to $0.4 million
and $0.8 million, a significant decline from $0.8 million and $2.4 million in
2024. The high costs in 2024 directly related to the acquisition of Pagefield,
which was the Group's first acquisition outside the U.S.
For the calculation of EPS based on GAAP Profit, as a denominator, the Group
uses the weighted average number of Common Stock outstanding during the
period. For the calculation of EPS based on Adjusted Profit, as a denominator,
the Group uses the weighted average number of Legally Issued shares during the
period. This comprises all the Common Stock outstanding, as well as those
shares that were yet unvested but entitled the owner to dividends and voting
rights.
Definitions and Uses of Non-GAAP Financial Measures
Our management uses a variety of financial and operating metrics to analyze
our performance. These metrics are significant factors in assessing our
operating results and profitability. These financial and operating metrics
include Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA Incl. M&A
expense, Adjusted net income, Adjusted EPS, fully diluted, Organic Revenue
Growth, Adjusted Free Cash Flow, which are financial measures not recognized
under US GAAP.
These non-GAAP financial measures are used by management to measure our
operating performance, but may not be directly comparable to similar measures,
such as EBITDA or Adjusted EBITDA, relied on or reported by other companies,
including other companies in our industry. We believe excluding items that
neither relate to the ordinary course of business nor reflect our underlying
business operating performance, such as equity-based compensation, the
amortization of acquired intangible assets, acquisition-related
post-combination compensation and contingent consideration, gains on bargain
purchase price, interest and tax enables meaningful period-to-period
comparisons of our operating performance. We also use these non-GAAP financial
measures when publicly providing our business outlook, for internal management
purposes, and as a basis for evaluating potential acquisitions and
dispositions.
We believe that the exclusion of equity-based compensation expense such as
stock options, restricted stock awards, restricted stock units and
equity-based compensation related to retained pre-UK IPO shares granted in
relation to our listing on the London Stock Exchange, is appropriate because
it eliminates the impact of non-cash expenses for equity-based compensation
costs that are based upon valuation methodologies and assumptions that can
vary significantly over time due to factors that are (i) unrelated to our core
operating performance, and (ii) can be outside of our control. Although we
exclude equity-based compensation expenses from our non-GAAP measures, equity
compensation has been, and will continue to be, an important part of our
future compensation strategy and a significant component of our future
expenses that may increase in future periods. Additionally, we believe the
exclusion of compensation expense related to share appreciation rights, which
are cash settled, is unrelated to our core operating performance in addition
to the fact that share appreciation rights are no longer part of our
compensation plans going forward.
We define Adjusted EBITDA, which is a non-GAAP financial measure, as
consolidated net loss before depreciation, interest income, interest expense,
income tax expense, mergers and acquisitions ("M&A") expenses, long-term
incentive program charges, share-based accounting charges, post-combination
compensation charges, impairment, change in fair value of contingent
consideration, gain on bargain purchase price net of deferred taxes and
amortization of intangible assets. Adjusted EBITDA Incl. M&A expense we
define as net loss before depreciation, interest income, interest expense,
income tax expense, long-term incentive program charges, share-based
accounting charges, post-combination compensation charges, change in fair
value of contingent consideration, gain on bargain purchase price net of
deferred taxes and amortization of intangible assets. We define Adjusted
EBITDA Margin as Adjusted EBITDA divided by revenue. We believe that these
non-GAAP financial measures, when considered together with our GAAP financial
results and GAAP financial measures, provide management and investors with a
more complete understanding of our operating results, including underlying
trends. While our Adjusted EBITDA may not be directly comparable to the EBITDA
or other measures used by others, we believe it helps provide a clearer
picture of the underlying performance of the business by removing certain
expenses tied to specific historical acquisitions, including post-combination
compensation charges, as well as non-cash charges such as depreciation and
amortization of intangibles. Additionally, we believe that Adjusted EBITDA
provides investors and management with operating results that reflect our core
operating activity of serving clients by removing the highly variable M&A
costs expenditure.
We define Adjusted Net Income, which is a non-GAAP financial measure, as
consolidated net loss before long-term incentive program charges, share-based
accounting charges, post-combination compensation charges, change in fair
value of contingent consideration, impairment, gain on bargain purchase price
net of deferred taxes and amortization of intangible assets. We use Adjusted
Net Income for the purpose of calculating Adjusted Earnings per Share
("Adjusted EPS", being referenced as either "Adjusted EPS, basic" or "Adjusted
EPS, fully diluted"). Management uses Adjusted EPS diluted to assess total
group operating performance on a consistent basis. We define Adjusted Net
Income as net income excluding the impact of long-term incentive program
charges, share-based accounting charges, post-combination compensation
charges, change in fair value of contingent consideration, gain on bargain
purchase price net of deferred taxes and amortization of intangible assets. We
believe that these non-GAAP financial measures, when considered together with
our GAAP financial results and GAAP financial measures, provide management and
investors with a clearer picture of our underlying business operating results.
We define Adjusted Free Cash Flow, which is a non-GAAP financial measure, as
net cash provided by operating activities less cash payments for purchases of
property and equipment and less acquisition related payouts classified in
operating cash flows specifically changes in prepaid post combination
payments, changes in other liability (liability classified earnout
obligations) and changes in contingent consideration. We believe this non-GAAP
financial measure, when considered together with our GAAP financial results,
provides management and investors with useful supplemental information on our
ability to generate cash for ongoing business operations and capital
deployment.
We define Net Cash (Debt) as total unrestricted cash and cash equivalents less
the total principal amount of debt outstanding. The total principal amount of
debt outstanding is comprised of the long-term debt and current maturities of
long-term debt as presented in our consolidated balance sheets adding back any
debt issuance costs. We believe that the presentation of Net Cash (Debt)
provides useful information to investors because our management reviews Net
Cash (Debt) as part of our oversight of overall liquidity, financial
flexibility and leverage.
We define Organic Revenue Growth as the year-over-year revenue growth
excluding revenues from acquired businesses for the first twelve months
following the date of acquisition. For purposes of this calculation, the
revenue of an acquired business is classified as acquired revenue and excluded
from Organic Revenue Growth until the thirteenth month following the
acquisition date. Beginning in the thirteenth month, the revenue from that
acquisition is included in the Organic Revenue Growth comparison against the
corresponding prior-year period. This approach ensures comparability by
aligning revenue bases year-over-year and isolating the performance of our
ongoing operations. We believe that Organic Revenue Growth is a useful
supplemental metric for investors and management, as it provides a clearer
view of underlying revenue trends excluding the impact of acquisition-related
growth.
Certain monetary amounts, percentages and other figures included elsewhere in
this earnings release have been subject to rounding adjustments. Accordingly,
figures shown as totals in certain tables or charts may not be the arithmetic
aggregation of the figures that precede them, and figures expressed as
percentages in the text may not total 100% or, as applicable, when aggregated
may not be the arithmetic aggregation of the percentages that precede them.
Condensed Consolidated Balance Sheets
(Amounts in thousands, except share and per share data)
December 31, 2025 December 31, 2024
(Unaudited)
ASSETS:
Current assets:
Cash and cash equivalents $20,436 $14,536
Contract receivables, net 21,851 18,285
Notes receivable - related parties, current portion 750 863
Income taxes receivable 2,068 3,185
Prepaid post-combination compensation, current portion 3,585 6,070
Prepaid expenses and other current assets 9,598 2,726
Amounts due from related parties 266 -
Total current assets 58,554 45,665
Property and equipment at cost, less accumulated depreciation 598 751
Notes receivable - related parties, long term 900 1,050
Operating lease right of use asset 18,829 18,428
Goodwill 56,990 64,308
Other intangible assets, net of accumulated amortization 37,113 32,144
Deferred income tax asset 24,600 11,038
Prepaid post-combination compensation, long term 4,692 888
Other long-term assets 276 189
TOTAL ASSETS $202,552 $174,461
LIABILITIES AND EQUITY:
Current liabilities:
Accounts payable and accrued expenses 30,819 20,044
Amounts owed to related parties - 556
Deferred revenue 3,310 3,150
Operating lease liability, current portion 5,070 4,827
Contingent consideration, current portion 3,134 2,093
Other liability, current portion 1,441 1,135
Notes payable, current portion, net 9,082 6,031
Total current liabilities 52,856 37,836
Notes payable, long term, net 37,906 26,014
Contingent consideration, long term 9,864 8,803
Other liability, long term 10,553 3,745
Operating lease liability, long term 16,469 16,808
Total liabilities $127,648 $93,206
Stockholders' equity:
Common stock, $0.001 par value, 1,000,000,000 shares authorized, 25,174,492 24 23
and 24,017,599 shares issued and outstanding as of December 31, 2025, and
2024, respectively
Additional paid-in capital 237,075 197,489
Accumulated deficit (163,381) (115,721)
Accumulated other comprehensive income (loss) 1,186 (536)
Total stockholders' equity 74,904 81,255
TOTAL LIABILITIES AND EQUITY $202,552 $174,461
Condensed Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
Years Ended December 31,
2025 2024
(Unaudited)
Revenue $186,541 $149,563
Operating expenses:
Salaries and other personnel costs 160,800 126,640
Office and other direct costs 7,094 5,651
Cost of services 167,894 132,291
Salaries, general and administrative 31,791 26,837
Mergers and acquisitions expense 837 2,434
Depreciation and amortization expense 5,676 4,244
Loss on impairment of intangible assets 2,890 -
Loss on impairment of goodwill 6,219 -
Change in fair value of contingent consideration 5,147 1,910
Total operating expenses 220,454 167,716
Loss from operations (33,913) (18,153)
Gain on bargain purchase 2,043 2,464
Interest income 81 177
Interest expense (3,402) (1,900)
Other income, net 589 -
Net loss before income taxes (34,602) (17,412)
Income tax expense (4,399) (6,545)
Net loss $(39,001) $(23,957)
Net loss per share attributable to common stockholders, basic and diluted $(2.37) $(2.34)
(2024 restated)
Basic and diluted 17,466,665 13,409,160
Net loss $(39,001) $(23,957)
Foreign currency translation gain (loss) 1,722 (536)
Total comprehensive loss $(37,279) $(24,493)
Condensed Consolidated Statements of Stockholders' Equity
(Amounts in thousands, except share and per share data)
(Unaudited)
Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders' Equity
Shares Amount
(Restated)
Balance at December 31, 2024 24,017,599 $23 $197,489 $(115,721) $(536) $81,255
Long term incentive program charges - - 5,790 - - 5,790,000
Issuance of unvested legally outstanding shares 719,618 - - - - -
Related to acquisitions
Issuance of common stock 177,744 - 1,284 - - 1,284
Issuance of common stock for settlement of other liability - - 342 - - 342,000
Vesting of stock issued from acquisitions - - 1 (1) - -
Vesting of restricted stock awards - - 1 (1) - -
Vesting of restricted stock units 329,141 1 - (1) - -
Repayment of note receivable by Alpine Group (63,356) - (532) - - (532)
Post-combination compensation charge-shares - - 3,074 - - 3,074
Dividends - - - (8,656) - (8,656)
Forfeiture of unvested restricted stock (6,254) - - - - -
Share-based accounting charge - - 29,626 - - 29,626
Foreign currency translation gain - - - - 1,722 1,722
Net loss - - - (39,001) - (39,001)
Balance at December 31, 2025 25,174,492 $24 $237,075 $(163,381) $1,186 $74,904
Condensed Consolidated Statements of Stockholders' Equity
(Amounts in thousands, except share and per share data)
Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive (Loss) Total Stockholders' Equity
Shares Amount
(Restated)
Balance at December 31, 2023 23,054,393 $22 $156,972 $(74,925) $- 82,069
Issuance of unvested legally outstanding shares 537,054 - - - - -
Long term incentive program charges - - 3,784 - - 3,784
Dividends - - - (16,836) - (16,836)
Vesting of stock issued from acquisitions - - 1 (1) - -
Vesting of restricted stock awards - 1 - (1) - -
Vesting of restricted stock units 158,337 - 1 (1) - -
Common stock issued to Multistate as settlement of contingent consideration 88,287 - 691 - - 691
Issuance of common stock for acquisition 179,528 - 1,443 - - 1,443
Post-combination compensation charge-shares - - 2,793 - - 2,793
Share-Based Accounting Charge Retained Pre-IPO Shares - - 31,804 - - 31,804
Foreign currency translation (loss) - - - - (536) (536)
Net loss - - - (23,957) - (23,957)
Balance at December 31, 2024 24,017,599 $23 $197,489 $(115,721) $(536) $81,255
Consolidated Statements of Cash Flows
(Amounts in thousands, except share and per share data)
Years Ended December 31,
2025 2024
(Unaudited)
Cash Flows from Operating Activities:
Net loss $(39,001) $(23,957)
Adjustments to reconcile net loss to net cash provided by operating
activities:
Depreciation 192 136
Amortization expense - intangibles 6,046 4,671
Amortization of right of use assets 5,466 4,071
Amortization of prepaid post-combination compensation 8,987 5,062
Accretion of other liability 8,490 3,742
Amortization of debt discount 236 182
Provision for deferred income taxes (2,712) (1,294)
Share-based accounting charge 29,626 31,804
Stock-based compensation 7,086 4,162
Post-combination compensation charge-shares 3,074 2,793
Change in fair value of contingent consideration 5,147 1,910
Gain on bargain purchase (2,043) (2,464)
Credit losses on accounts receivable 2,353 -
Impairment of goodwill and other intangible assets 9,109 -
Employee loan forgiveness 250 -
(Increase) decrease in:
Accounts receivable (5,060) (3,118)
Prepaid post-combination expense (10,456) (4,640)
Prepaid expenses and other assets (1,142) 573
Increase (decrease) in:
Accounts payable and accrued expenses 6,325 (2,053)
Income taxes payable and receivable 1,149 (2,219)
Deferred revenue 149 959
Contingent consideration (4) (269)
Operating lease liability (5,961) (4,277)
Other liabilities (1,714) (982)
Transactions with members and related parties (822) 1,611
Net Cash Provided by Operating Activities 24,770 16,403
Cash Flows from Investing Activities:
Purchases of property and equipment (11) (56)
Proceeds issued for notes receivable - related parties (500) -
Proceeds received for notes receivable - related parties - 350
Cash paid for acquisitions, net of cash acquired (21,065) (19,784)
Net Cash Used in Investing Activities (21,576) (19,490)
Cash Flows from Financing Activities:
Proceeds from notes payable 24,000 25,000
Payment of debt issuance costs (128) (215)
Payment of deferred equity offering costs (2,919) -
Principal payment of note payable (9,165) (3,863)
Payment of contingent considerations (582) (750)
Dividends paid (8,656) (16,836)
Net Cash Provided by Financing Activities 2,550 3,336
Effect of foreign exchange rate changes on cash and cash equivalents 156 (54)
Net Change in Cash and Cash Equivalents 5,900 195
Cash and Cash Equivalents as of Beginning of Period 14,536 14,341
Cash and Cash Equivalents at the End of Period $20,436 $14,536
Years Ended December 31,
2025 2024
(Unaudited)
Supplemental disclosure of cash flow information:
Cash paid for interest $3,165 $1,718
Cash paid for income taxes $5,939 $10,049
Common stock received for repayment of note receivable with Alpine Group $532 $-
Right of use assets obtained with lease liabilities $5,866 $1,065
Contingent consideration issued for acquisitions $- $3,798
Common stock issued for acquisitions $1,285 $1,443
Stock issued for settlement of other liability $342 $-
Accrued deferred equity offering costs $2,598 $-
Stock issued for settlement of contingent consideration $- $691
Contact Information
Public Policy Holding Company, Inc.
800 North Capitol St. NW
Washington, DC 20002
+1 (202) 688 0020
For Investors
Matthew Mazzanti, Investor Relations
IR@pphcompany.com
For Media & Other
inquiries@pphcompany.com
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