Kingsway Financial Services Inc.

Second-quarter 2026 consolidated revenue increased 27.6% to $39.4 million from $30.9 million a year ago. Consolidated net income was $200,000 versus a net loss of $3.2 million in Q2 2025, and consolidated adjusted EBITDA was $5.2 million versus $1.7 million. KSX revenue rose 68.3% to $22.3 million and KSX adjusted EBITDA increased 77.9% to $4.3 million. Extended Warranty revenue declined 3.1% to $17.1 million versus $17.6 million, but on a pro forma basis for Trinity it increased 6.5% to $16.1 million, with pro forma cash sales up 6.9% and pro forma adjusted EBITDA at $1 million. Portfolio EBITDA was $7.2 million, a quarterly record, and LTM portfolio EBITDA was $22 million to $23 million as of June 30, 2026. Total net debt was $59.9 million versus $62.4 million at December 31, 2025. JT reaffirmed the 2026 targets of 3 to 5 acquisitions and double-digit organic growth at KSX and Extended Warranty.

JT Fitzgerald framed Kingsway as a public “compounder” built around asset-light, recurring-revenue services businesses and a search-fund acquisition model. He emphasized that the quarter was the strongest in his tenure, with record KSX EBITDA, record portfolio EBITDA, and improving momentum in several businesses, while also saying the company is still early in its journey. His tone was optimistic and confident, but he repeatedly noted that there is still “so much more to achieve” across the portfolio.

Kent Hansen focused on the quarter’s financial improvement and a few one-time items. He cited the 27.6% revenue increase to $39.4 million, the move to $200,000 of net income, and adjusted EBITDA of $5.2 million, while noting KSX and Extended Warranty both improved on a profitability basis. He also called out a $1.3 million gain on the Trinity sale, about $1.1 million of cash distributions from ARGO-related search investments, $1.4 million of noncash stock-based award expense, and about $600,000 tied to the legacy BNSF legal liability; he added that three operating subsidiaries were out of covenant compliance but were either waived or in process of being waived, and that those loans are nonrecourse to Kingsway.

Management said RCC was found through a broker and made sense because it has more than 80% recurring revenue, strong margins, and a history of organic growth, while Image Solutions now has room for tuck-in acquisitions after delevering. On ARGO, JT said there are a handful of active investments left and Kingsway expects more distributions or eventual monetizations. In response to questions on portfolio EBITDA and leverage, management said the $22 million to $23 million LTM figure is a fair anchor and that consolidated leverage is around $2.7 million, giving room for more acquisitions. On search competition, JT said Kingsway is not seeing deal multiples creep meaningfully and said the platform’s sourcing engine, tech stack, and industry map are helping attract more entrepreneurs to KSX.