Business Wire | Nov 11, 2021 04:15PM EST

RYAN SPECIALTY GROUP REPORTS THIRD QUARTER 2021 RESULTS

Nov. 11, 2021

CHICAGO--(BUSINESS WIRE)--Nov. 11, 2021--Ryan Specialty Group Holdings, Inc. (NYSE: RYAN) ("Ryan Specialty" or the "Company"), a leading international specialty insurance firm, today announced results for the third quarter ended September 30, 2021.

Third Quarter 2021 Highlights

* Total Revenue grew 49.0% year-over-year to $352.8 million, compared to $236.8 million in the prior-year period * Organic Revenue Growth Rate* was 28.9% for the quarter, compared to 13.6% for the same quarter last year * Net Loss of $32.6 million, compared to Net Income of $10.8 million in the prior-year period. Net Loss included $58.6 million of one-time costs incurred by the Company in the third quarter of 2021 primarily related to the Company's completed initial public offering ("IPO"). Net Loss per Share was $0.16 * Adjusted EBITDAC* increased 55.9% to $105.0 million, compared to $67.4 million in the prior-year period * Adjusted EBITDAC Margin* rose 140 basis points year-over-year to 29.8% * Adjusted Net Income* increased 51.1% to $62.9 million, compared to $41.7 million in the prior-year period. Adjusted Diluted Earnings per Share for the third quarter of 2021 was $0.24

"The Ryan Specialty team didn't miss a beat as we completed our IPO and debuted on the NYSE," said Patrick G. Ryan, Founder, Chairman and Chief Executive Officer of Ryan Specialty Group. "We delivered a very strong financial performance across the board, with organic revenue growth for the quarter eclipsing 28% driven by our extraordinary talent, differentiated platform, ongoing broker consolidation, and a robust E&S market. In addition, our platform's scalability facilitated another quarter of improved margins on a year-over-year basis. With the integration of All Risks in the home stretch and our exceptionally talented team of specialists, we are well positioned to maintain our momentum and execute on all phases of our game plan."

Summary of Third Quarter Results

Three months ended Change September 30, (in thousands, 2021 2020except $ % percentages)GAAP financialmeasures $ $ $ 49.0%Total revenue 352,766 236,811 115,955

Compensation 286,538 162,981 123,557 and benefits 75.8

General and 38,754 31,370 7,384 administrative 23.5

Total 353,496 210,985 142,511 operating 67.5expensesOperating (730) 25,826 (26,556) income (loss) (102.8)

Net income (32,590) 10,796 (43,386) (loss) (401.9)

Net income (loss) (1,334) 10,211 (11,545) (113.1)attributableto membersCompensation 81.2% 68.8%and BenefitsExpense RatioGeneral and 11.0% 13.2%AdministrativeExpense RatioNet Income (9.2)% 4.6%(Loss) MarginEarnings $ (Loss) per (0.16)ShareDiluted Earnings $ (0.16)(Loss) perShareNon-GAAPfinancialmeasures*Organic 28.9% 13.6%Revenue Growth RateAdjusted Compensation $ 212,590 $ 149,058 $ 63,532 42.6%and Benefits ExpenseAdjustedCompensation 60.3% 62.9%and Benefits ExpenseRatioAdjusted General and $ 35,153 $ 20,393 $ 14,760 72.4%Administrative ExpenseAdjustedGeneral and 10.0% 8.6%Administrative ExpenseRatioAdjusted $ $ $ 55.9%EBITDAC 105,023 67,360 37,663

Adjusted 29.8% 28.4%EBITDAC MarginAdjusted Net $ $ $ 51.1%Income 62,949 41,664 21,285

Adjusted Net 17.8% 17.6%Income MarginAdjusted Diluted $ 0.24Earnings perShare*For a definition and a reconciliation of Organic Revenue Growth Rate, Adjusted Compensation and Benefits Expense, Adjusted Compensation and Benefits Ratio, Adjusted General and Administrative Expense, Adjusted General and Administrative Expense Ratio, Adjusted EBITDAC, Adjusted EBITDAC Margin, Adjusted Net Income, and Adjusted Net Income Margin, and Adjusted Diluted Earnings per Share to the most directly comparable GAAP measure, see "Non-GAAP Financial Measures and Key Performance Indicators" below. Third Quarter 2021 Review*

Total revenue for the third quarter of 2021 was $352.8 million, an increase of 49.0% compared to $236.8 million in the prior-year period. This increase was primarily driven by strong organic growth as well as the All Risks acquisition, which was completed on September 1, 2020. Organic revenue growth of 28.9%, was driven by new client wins, expanded relationships with existing clients, an overall expansion of the E&S market, and premium rate increases.

Total operating expenses for the third quarter of 2021 were $353.5 million, a 67.5% increase compared to the prior-year period. This was primarily due to an increase in compensation and benefits expense, which is heavily correlated to revenue growth as many of Ryan Specialty's producers are compensated based on a percentage of the revenue they generate for the Company. Additionally, the Company recognized IPO-related compensation expense of $57.6 million. This IPO-related compensation expense reflects several one-time payments made at the IPO, the revaluation of existing equity grants at IPO, as well as the first period of expense related to one-time IPO awards. General and administrative expense also rose compared to the prior-year period to accommodate revenue growth, while amortization of intangible assets increased as a result of the All Risks acquisition.

Net loss for the third quarter of 2021 was $32.6 million, compared to net income of $10.8 million in the prior-year period. The reduction was due to certain non-operating charges in connection with the IPO, amortization from the acquired intangible assets from the All Risks acquisition, and increased interest expense in connection with the debt used to fund the All Risks acquisition.

Adjusted EBITDAC of $105.0 million grew 55.9% from $67.4 million in the prior-year period. Adjusted EBITDAC Margin for the quarter was 29.8%, a 140 basis point improvement compared to the prior-year period. The increases in Adjusted EBITDAC and Adjusted EBITDAC Margin were primarily driven by revenue growth creating operating leverage in compensation and benefits expense, as well as continued execution of the Company's restructuring plan, partially offset by increased General and Administrative expense. The restructuring plan, which the Company initiated in 2020, is anticipated to achieve $25 million in cumulative annualized cost savings when fully actioned by June 30, 2022.

Adjusted Net Income for the third quarter of 2021 rose 51.1% to $62.9 million, compared to $41.7 million in the prior-year period. Adjusted Net Income Margin rose 20 basis points to 17.8%, reflecting operating leverage as revenue growth outpaced growth in operating expenses.

For a definition and a reconciliation of Organic Revenue Growth Rate, Adjusted Compensation and Benefits Expense, Adjusted Compensation and Benefits Ratio, Adjusted General and Administrative Expense, Adjusted General* and Administrative Expense Ratio, Adjusted EBITDAC, Adjusted EBITDAC Margin, Adjusted Net Income, and Adjusted Net Income Margin, and Adjusted Diluted Earnings per Share to the most directly comparable GAAP measure, see "Non-GAAP Financial Measures and Key Performance Indicators" below. Third Quarter 2021 Review*

Total revenue for the third quarter of 2021 was $352.8 million, an increase of 49.0% compared to $236.8 million in the prior-year period. This increase was primarily driven by strong organic growth as well as the All Risks acquisition, which was completed on September 1, 2020. Organic revenue growth of 28.9%, was driven by new client wins, expanded relationships with existing clients, an overall expansion of the E&S market, and premium rate increases.

Total operating expenses for the third quarter of 2021 were $353.5 million, a 67.5% increase compared to the prior-year period. This was primarily due to an increase in compensation and benefits expense, which is heavily correlated to revenue growth as many of Ryan Specialty's producers are compensated based on a percentage of the revenue they generate for the Company. Additionally, the Company recognized IPO-related compensation expense of $57.6 million. This IPO-related compensation expense reflects several one-time payments made at the IPO, the revaluation of existing equity grants at IPO, as well as the first period of expense related to one-time IPO awards. General and administrative expense also rose compared to the prior-year period to accommodate revenue growth, while amortization of intangible assets increased as a result of the All Risks acquisition.

Net loss for the third quarter of 2021 was $32.6 million, compared to net income of $10.8 million in the prior-year period. The reduction was due to certain non-operating charges in connection with the IPO, amortization from the acquired intangible assets from the All Risks acquisition, and increased interest expense in connection with the debt used to fund the All Risks acquisition.

Adjusted EBITDAC of $105.0 million grew 55.9% from $67.4 million in the prior-year period. Adjusted EBITDAC Margin for the quarter was 29.8%, a 140 basis point improvement compared to the prior-year period. The increases in Adjusted EBITDAC and Adjusted EBITDAC Margin were primarily driven by revenue growth creating operating leverage in compensation and benefits expense, as well as continued execution of the Company's restructuring plan, partially offset by increased General and Administrative expense. The restructuring plan, which the Company initiated in 2020, is anticipated to achieve $25 million in cumulative annualized cost savings when fully actioned by June 30, 2022.

Adjusted Net Income for the third quarter of 2021 rose 51.1% to $62.9 million, compared to $41.7 million in the prior-year period. Adjusted Net Income Margin rose 20 basis points to 17.8%, reflecting operating leverage as revenue growth outpaced growth in operating expenses.

For the definition of each of the non-GAAP measures referred to above as well* as a reconciliation of such non-GAAP measures to their most directly comparable GAAP measures, see "Non-GAAP Financial Measures and Key Performance Indicators" below. Review of Third Quarter 2021 Revenue by Specialty

Wholesale Brokerage net commissions and fees increased by 48.3% to $229.1 million, compared to $154.5 million in the prior-year period. This increase was primarily due to strong organic growth within the specialty, as well as revenue from the All Risks acquisition, which was included in the organic growth calculation beginning September 1st.

Binding Authority net commissions and fees grew by 46.1% to $52.8 million, compared to $36.1 million in the prior-year period. This increase was primarily due to strong organic growth within the specialty, as well as revenue from the All Risks acquisition, which was included in the organic growth calculation beginning September 1st.

Underwriting Management net commissions and fees increased by 53.4% to $70.7 million, compared to $46.1 million in the prior-year period. This increase was primarily due to strong organic growth within the specialty, as well as revenue from the All Risks acquisition, which was included in the organic growth calculation beginning September 1st.

Liquidity and Financial Condition

As of September 30, 2021, the Company had cash and cash equivalents of $413.7 million and outstanding debt principal of $1.6 billion.

Full Year 2021 Outlook*

The Company is raising its full year 2021 outlook for both Organic Revenue Growth Rate and Adjusted EBITDAC Margin:

* Organic Revenue Growth Rate for full year 2021 is now expected to be between 21.5% - 22.5%, compared to the Company's prior outlook of between 18.0% - 20.0%. * Adjusted EBITDAC Margin for full year 2021 is now expected to be between 31.5% - 32.0%, compared to the Company's prior outlook of between 30.0% - 30.5%.

For a definition of Organic Revenue Growth Rate and Adjusted EBITDAC Margin* as well as an explanation of the Company's inability to provide reconciliations of these forward-looking non-GAAP measures, see "Non-GAAP Financial Measures and Key Performance Indicators" below. Conference Call Information

Ryan Specialty will host a conference call today at 5:00 PM ET to discuss these results. A live audio webcast of the conference call will be available on the Company's website at ryansg.com in its Investors section.

The dial-in number for the conference call is (877) 451-6152 (toll-free) or (201) 389-0879 (international). Please dial the number 10 minutes prior to the scheduled start time.

A webcast replay of the call will be available on the Company's website at ryansg.com in its Investors section for one year following the call.

About Ryan Specialty Group

Founded by Patrick G. Ryan in 2010, Ryan Specialty Group (NYSE: RYAN) is a rapidly growing service provider of specialty products and solutions for insurance brokers, agents and carriers. Ryan Specialty Group provides distribution, underwriting, product development, administration and risk management services by acting as a wholesale broker and a managing underwriter. Our mission is to provide industry-leading innovative specialty insurance solutions for insurance brokers, agents and carriers. Learn more at ryansg.com.

Forward-Looking Statements

All statements in this release and in the corresponding earnings call that are not historical are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve substantial risks and uncertainties. For example, all statements the Company makes relating to its estimated and projected costs, expenditures, cash flows, growth rates and financial results or its plans and objectives for future operations, growth initiatives, or strategies and the statements under the caption "Full Year 2021 Outlook" are forward-looking statements. Words such as "anticipate," "estimate," "expect," "project," "plan," "intend," "believe," "may," "will," "should," "can have," "likely" and variations of such words and similar expressions are intended to identify such forward-looking statements. All forward-looking statements are subject to risks and uncertainties, known and unknown, that may cause actual results to differ materially from those that the Company expected. Specific factors that could cause such a difference include, but are not limited to, those disclosed previously in the Company's filings with the Securities and Exchange Commission ("SEC") that include, but are not limited to: the Company's potential failure to develop a succession plan for the senior management team, including Patrick G. Ryan; the Company's failure to recruit and retain revenue producers; the cyclicality of, and the economic conditions in, the markets in which the Company operates; conditions that result in reduced insurer capacity; the potential loss of the Company's relationships with insurance carriers or its clients, becoming dependent upon a limited number of insurance carriers or clients or the failure to develop new insurance carrier and client relationships; significant competitive pressures in each of the Company's businesses; decreases in the premiums or commission rates set by insurers, or actions by insurers seeking repayment of commissions; decreases in the amounts of supplemental or contingent commissions the Company receives; the Company's inability to collect its receivables; the potential that the Company's underwriting models contain errors or are otherwise ineffective; any damage to the Company's reputation; decreases in current market share as a result of disintermediation within the insurance industry; impairment of goodwill; the inability to maintain rapid growth or to generate sufficient revenue to achieve and maintain profitability; the impact if the Company's MGU programs are terminated or changed; the risks associated with the evaluation of potential acquisitions and the integration of acquired businesses as well as introduction of new products, lines of business and markets; the occurrence of natural or man-made disasters; being subject to E&O claims as well as other contingencies and legal proceedings; the impact on the Company's operations and financial condition from the effects of the current COVID-19 pandemic; the impact of breaches in security that cause significant system or network disruptions; not being able to generate sufficient cash flow to service all of the Company's indebtedness and being forced to take other actions to satisfy its obligations under such indebtedness; and the impact of being unable to refinance the Company's indebtedness.

For more detail on the risk factors that may affect the Company's results, see the section entitled "Risk Factors" in our Prospectus filed in connection with our IPO with the Securities and Exchange Commission on July 23, 2021, and in other documents that we file with, or furnish to, the SEC. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. Given these factors, as well as other variables that may affect the Company's operating results, you are cautioned not to place undue reliance on these forward-looking statements, not to assume that past financial performance will be a reliable indicator of future performance, and not to use historical trends to anticipate results or trends in future periods. The forward-looking statements included in this press release and on the related earnings call relate only to events as of the date hereof. We do not undertake, and expressly disclaim, any duty or obligation to update publicly any forward-looking statement after the date of this release, whether as a result of new information, future events, changes in assumptions or otherwise.

Non-GAAP Financial Measures and Key Performance Indicators

In assessing the performance of our business, we use non-GAAP financial measures that are derived from our consolidated financial information, but which are not presented in our consolidated financial statements prepared in accordance with GAAP. We use these non-GAAP financial measures when planning, monitoring and evaluating our performance. We consider these non-GAAP financial measures to be useful metrics for management and investors to facilitate operating performance comparisons from period to period by excluding potential differences caused by variations in capital structures, tax positions, depreciation, amortization and certain other items that we believe are not representative of our core business. We use the following non-GAAP measures for business planning purposes, in measuring our performance relative to that of our competitors, to help investors to understand the nature of our growth, and to enable investors to evaluate the run-rate performance of the Company. Non-GAAP measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for an analysis of our results as reported under GAAP.

Organic Revenue Growth Rate: Organic Revenue Growth Rate represents the percentage change in revenue, as compared to the same period for the year prior, adjusted for revenue attributable to acquisitions during their first 12 months of the Company's ownership, and other adjustments such as contingent commissions, fiduciary investment income, and foreign exchange rates. The most directly comparable GAAP financial metric is Total Revenue Growth Rate.

Adjusted Compensation and Benefits Expense: Adjusted Compensation and Benefits Expense represents Compensation and Benefits Expense adjusted to reflect items such as (i) equity-based compensation, (ii) acquisition and restructuring related compensation expenses, and (iii) other exceptional or non-recurring compensation expenses, as applicable. The most directly comparable GAAP financial metric is Compensation and Benefits Expense.

Adjusted General and Administrative Expense: Adjusted General and Administrative Expense represents General and Administrative Expense adjusted to reflect items such as (i) acquisition and restructuring related general and administrative expenses, and (ii) other exceptional or non-recurring general and administrative expenses, as applicable. The most directly comparable GAAP financial metric is General and Administrative Expense.

Adjusted Compensation and Benefits Expense Ratio: Adjusted Compensation and Benefits Expense Ratio represents the Adjusted Compensation and Benefits Expense as a percentage of total revenue. The most directly comparable GAAP financial metric is Compensation and Benefits Expense Ratio.

Adjusted General and Administrative Expense Ratio: Adjusted General and Administrative Expense Ratio represents the Adjusted General and Administrative Expense as a percentage of total revenue. The most directly comparable GAAP financial metric is General and Administrative Expense Ratio.

Adjusted EBITDAC: Adjusted EBITDAC is defined as Net Income before interest expense, income tax expense, depreciation, amortization, and change in contingent consideration, adjusted to reflect items such as (i) equity-based compensation, (ii) acquisition-related expenses, and (iii) other exceptional or non-recurring items, as applicable. The most directly comparable GAAP financial metric is Net Income.

Adjusted EBITDAC Margin Adjusted EBITDAC Margin is defined as Adjusted EBITDAC as a percentage of total revenue. The most directly comparable GAAP financial metric is Net Income Margin.

Adjusted Net Income Adjusted Net Income is tax-effected earnings before amortization and certain items of income and expense, gains and losses, equity-based compensation, acquisition-related expenses, and certain exceptional or non-recurring items. The Company will be subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect to our allocable share of any net taxable income of Ryan Specialty Group, LLC. For comparability purposes, this calculation incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of Ryan Specialty Group, LLC. The most directly comparable GAAP financial metric is Net Income.

Adjusted Net Income Margin Adjusted Net Income Margin is defined as Adjusted Net Income as a percentage of total revenue. The most directly comparable GAAP financial metric is Net Income Margin.

Adjusted Diluted Earnings per Share: Adjusted Diluted Earnings per Share is defined as Adjusted Net Income divided by diluted shares outstanding after adjusting for the effect of the exchange of 100% of the outstanding common units of New RSG Holdings, LLC (together with the shares of Class B common stock) into shares of Class A common stock and the effect of unvested equity awards. The most directly comparable GAAP financial metric is Diluted Earnings per Share. The reconciliation of the above non-GAAP measures to their most directly comparable GAAP financial measure is set forth in the reconciliation table accompanying this release.

With respect to the Organic Revenue Growth Rate and Adjusted EBITDAC Margin outlook presented in the "Full Year 2021 Outlook" section of this press release, the Company is unable to provide a comparable outlook for, or a reconciliation to, Total Revenue Growth Rate or Net Income because it cannot provide a meaningful or accurate calculation or estimation of certain reconciling items without unreasonable effort. Its inability to do so is due to the inherent difficulty in forecasting the timing of items that have not yet occurred and quantifying certain amounts that are necessary for such reconciliation, including variations in effective tax rate, expenses to be incurred for acquisition activities and other one-time or exceptional items.

Consolidated Statements of Income (Unaudited)

Three months ended Nine months ended September 30, September 30, (in thousands, 2021 2020 2021 2020exceptpercentages)RevenueNet $ $ $ $ commissions 352,610 236,683 1,053,800 689,833and feesFiduciary 156 128 436 1,494investmentincome $ $ $ $ Total revenue 352,766 236,811 1,054,236 691,327

ExpensesCompensation 286,538 162,981 737,825 461,094and benefitsGeneral and 38,754 31,370 96,984 81,755administrativeAmortization 26,982 15,640 82,095 34,789

Depreciation 1,179 1,029 3,601 2,658

Change in 43 (35) 2,356 997contingentconsiderationTotal $ $ $ $ operating 353,496 210,985 922,861 581,293expensesOperating $ $ $ $ income (loss) (730) 25,826 131,375 110,034

Interest 21,193 10,859 60,224 26,295expenseIncome fromequity method 176 326 610 413investment inrelated partyOther (16,211) (1,574) (45,547) (4,066)non-operating(loss) incomeIncome (loss) $ $ $ $ before income (37,958) 13,719 26,214 80,086taxesIncome tax (5,368) 2,923 (802) 6,085expense(benefit)Net income $ $ $ $ (loss) (32,590) 10,796 27,016 74,001

GAAP financialmeasures $ $ $ $ Revenue 352,766 236,811 1,054,236 691,327

Compensation 286,538 162,981 737,825 461,094and benefitsGeneral and 38,754 31,370 96,984 81,755administrativeNet Income $ $ $ $ (loss) (32,590) 10,796 27,016 74,001

Compensation 81.2% 68.8% 70.0% 66.7%and BenefitsExpense RatioGeneral and 11.0% 13.2% 9.2% 11.8%AdministrativeExpense RatioNet Income (9.2)% 4.6% 2.6% 10.7%(loss) MarginEarnings $ $ (loss) per (0.16) (0.16)ShareDiluted Earnings $ (0.16) $ (0.16)(loss) perShare Non-GAAP Financial Measures (unaudited)

Three months ended Nine months ended September 30, September 30, (in thousands, 2021 2020 2021 2020exceptpercentages)Non-GAAPfinancialmeasures*Organic 28.9% 13.6% 25.6% 19.8%Revenue GrowthRateAdjusted Compensation $ 212,590 $ 149,058 $ 625,452 $ 434,209and BenefitsExpenseAdjustedCompensation 60.3% 62.9% 59.3% 62.8%and BenefitsExpense RatioAdjusted General and $ 35,153 $ 20,393 $ 88,870 $ 65,366AdministrativeExpenseAdjustedGeneral and 10.0% 8.6% 8.4% 9.5%AdministrativeExpense RatioAdjusted $ $ $ $ EBITDAC 105,023 67,360 339,914 191,752

Adjusted 29.8% 28.4% 32.2% 27.7%EBITDAC MarginAdjusted Net $ $ $ $ Income 62,949 41,664 209,739 121,261

Adjusted Net 17.8% 17.6% 19.9% 17.5%Income MarginAdjusted Diluted $ 0.24 $ 0.78Earnings perShare Consolidated Statements of Financial Position (Unaudited - All balances presented in thousands, except unit and par value data

September 30, 2021 December 31, 2020 ASSETSCURRENT ASSETSCash and cash $ 413,695 $ equivalents 312,651

Commissions and 171,862 177,699fees receivable- netFiduciary 1,916,585 1,978,152assetsPrepaid 7,738 8,842incentives -netOther current 21,039 16,006assetsTotal current $ 2,530,919 $ assets 2,493,350

NON-CURRENTASSETSGoodwill 1,223,957 1,224,196

Other 527,804 604,764intangibleassetsPrepaid 27,044 36,199incentives -netEquity method 47,087 47,216investment inrelated partyProperty and 15,034 17,423equipment - netLease 80,295 93,941right-of-useassetsDeferred tax 395,805 - assetsOther 10,511 12,293non-currentassetsTotal $ 2,327,537 $ non-current 2,036,032assets $ 4,858,456 $ TOTAL ASSETS 4,529,382

LIABILITIES,MEZZANINEEQUITY ANDSTOCKHOLDERS'/MEMBERS' EQUITYCURRENTLIABILITIESAccountspayable and 78,777 115,573accruedliabilitiesAccrued 335,923 349,558compensationOperating lease 18,811 19,880liabilitiesShort-term debtand current 26,769 19,158portion oflong-term debtFiduciary 1,916,585 1,978,152liabilitiesTotal current $ 2,376,865 $ liabilities 2,482,321

NON-CURRENTLIABILITIESAccrued - 69,121compensationOperating lease 69,928 83,737liabilitiesLong-term debt 1,568,410 1,566,192

Deferred tax 379 577liabilitiesTax receivable 282,470 - agreementliabilities Other 5,306 16,709non-currentliabilitiesTotal $ 1,926,493 $ non-current 1,736,336liabilitiesTOTAL $ 4,303,358 $ LIABILITIES 4,218,657

MEZZANINEEQUITYPreferred units($1.00 parvalue; 0 issuedand outstandingat September $ $ 30, 2021 and - 239,635260,000,000issued andoutstanding atDecember 31,2020)STOCKHOLDERS'/MEMBERS' EQUITYMembers' - 67,088interestClass A commonstock ($0.001par value;1,000,000,000shares 110 -authorized,109,903,867shares issuedand outstandingat September30, 2021)Class B commonstock ($0.001par value;1,000,000,000shares 149 -authorized,149,162,107shares issuedand outstandingat September30, 2021)Class X commonstock ($0.001par value;10,000,000shares - -authorized,640,784 sharesissued and 0outstanding atSeptember 30,2021)Preferred stock($0.001 parvalue;500,000,000shares - -authorized, 0shares issuedandoutstanding atSeptember 30,2021)Additional 327,805 -paid-in capitalAccumulated (17,115) -deficitAccumulatedother 1,760 2,702comprehensiveincomeTotalstockholders'equity attributable to $ 312,709 $ 69,790Ryan SpecialtyGroup Holdings,Inc. /members'equityNon-controlling 242,389 1,300interestsTotal 555,098 71,090stockholders'/members' equityTOTALLIABILITIES, $ 4,858,456 $ MEZZANINE AND 4,529,382STOCKHOLDERS'/MEMBERS' EQUITY Consolidated Statements of Cash Flows (Unaudited)

Nine months ended September 30, 2021 2020

CASH FLOWS FROMOPERATING ACTIVITIESNet income $ 27,016 $ 74,001

Adjustments toreconcile net incometo cash flows from(used for) operatingactivities:Loss (gain) from (610) (413)equity methodinvestmentAmortization 82,095 34,789

Depreciation 3,601 2,658

Prepaid and deferred 34,960 12,559compensation expenseNon-cash equity based 46,877 6,355compensationAmortization of 8,546 1,758deferred debtissuance costsDeferred income taxes (5,860) (56)

Loss on 8,634 1,708extinguishment ofexisting debtChange (net ofacquisitions anddivestitures) in:Commissions and fees 6,004 17,669receivable - netAccrued interest 602 19

Other current assets 27,751 (121,565)and accruedliabilitiesOther non-current (85,241) (27,218)assets and accruedliabilitiesTotal cash flows $ 154,375 $ 2,264provided by operatingactivitiesCASH FLOWS FROMINVESTING ACTIVITIESCash paid for - (808,546)acquisitions - net ofcash acquiredAsset acquisitions (343,158) (5,236)

Prepaid incentives 4,136 (6,213)issued - net ofrepaymentsEquity method - (23,500)investment in relatedpartyCapital expenditures (6,429) (10,596)

Total cash flows used $ (345,451) $ (854,091)for investingactivitiesCASH FLOWS FROMFINANCING ACTIVITIESContributions of - 118,936members' equity andpreferred equityPurchase of remaining (48,368) -interest in Ryan RePayment of contingent (4,495) -considerationEquity repurchases (3,880) (44,957)from pre-IPOunitholdersRepurchase of (78,256) -preferred equityCash distribution to (47,039) (45,705)pre-IPO unitholdersRepayment of term (12,375) (140,625)debtRepayment of (1,108) -unsecured promissorynotesBorrowing of term - 1,650,000debtRepayment of - (25,000)subordinated notesRepayments on - (428,697)revolving creditfacilitiesFinance lease and (108) 230other costs paidDebt issuance costs (1,893) (70,484)paidRepurchase of Class A (183,616) -common stock in theIPORepurchase of pre-IPOLLC Units and payment (780,352) -of Alternative TRAPaymentsIssuance of Class Acommon stock in the 1,455,184 -IPO, net of offeringcosts paidTotal cash flows $ 293,694 $ 1,013,698provided by financingactivitiesEffect of changes inforeign exchange (1,574) (1,095)rates on cash andcash equivalentsNET CHANGE IN CASH $ 101,044 $ 160,776AND CASH EQUIVALENTSCASH AND CASH $ 312,651 $ 52,016EQUIVALENTS-BeginningbalanceCASH AND CASH $ 413,695 $ 212,792EQUIVALENTS-EndingbalanceSupplemental cashflow information:Interest and $ 51,050 $ 23,641financing costs paidIncome taxes paid $ 6,341 $ 5,811

Issuance of Class A common stock in $ 21 $ -connection withCommon Blocker MergerIssuance of Class X common stock in $ 1 $ -connection withCommon Blocker MergerExchange of Founders' subordinated $ - $ (74,990)promissory notes forequity issuedPreferred equityissued in exchange $ $ 74,270for Founders' -subordinatedpromissory notesCommon equity issuedin exchange for $ $ 7,661Founders' -subordinatedpromissory notesLoss onextinguishment of $ $ (6,941)Founders' -subordinatedpromissory notesCommon equity issued $ $ 102,000as consideration for -business combination Net Commissions and Fees

Three months ended September 30,(in thousands, 2021 % of 2020 % of Changeexcept total total percentages)Wholesale $ 65.0% $ 65.3% $ 48.3%Brokerage 229,146 154,484 74,662

Binding 52,795 15.0 36,130 15.3 Authorities 16,665 46.1

Underwriting 70,669 20.0 46,069 19.4 Management 24,600 53.4

Total Net $ $ $ 49.0%commissions 352,610 236,683 115,927and feesNine months ended September 30,(in thousands, except percentages)2021

% of total

2020

% of total

Change

Wholesale Brokerage$

676,229

64.2%

$

460,706

66.8%

$

215,523

46.8%

Binding Authorities161,436

15.3

101,837

14.8

59,599

58.5

Underwriting Management216,135

20.5

127,290

18.4

88,845

69.8

Total Net commissions and fees$

1,053,800

$

689,833

$

363,967

52.8%

Reconciliation of Organic Revenue Growth Rate to Total Revenue Growth Rate

Nine months ended September 30,(in % of % ofthousands, 2021 total 2020 total Changeexceptpercentages)Wholesale $ 64.2% $ 66.8% $ 46.8%Brokerage 676,229 460,706 215,523

Binding 161,436 15.3 14.8 Authorities 101,837 59,599 58.5

Underwriting 216,135 20.5 18.4 Management 127,290 88,845 69.8

Total Net $ $ $ 52.8%commissions 1,053,800 689,833 363,967and fees Reconciliation of Organic Revenue Growth Rate to Total Revenue Growth Rate

Three months ended September 30, 2021 2020

Total Revenue Growth Rate (GAAP) (1) 49.0% 22.4%

Less: Mergers and Acquisitions (2) (18.8) (9.8)

Change in Other (3) (1.3) 1.0

Organic Revenue Growth Rate 28.9% 13.6%(Non-GAAP)(1)

September 30, 2021 revenue of $352.8 million less September 30, 2020 revenue of $236.8 million is a $116.0 million period-over-period change. The change, $116.0 million, divided by the September 30, 2020 revenue of $236.8 million is a total revenue change of 49.0%. September 30, 2020 revenue of $236.8 million less September 30, 2019 revenue of $193.5 million is a $43.3 million period-over-period change. The change, $43.3 million, divided by the September 30, 2019 revenue of $193.5 million is a total revenue change of 22.4%. Refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 10-Q for the third quarter of 2021 to be filed with the SEC (the "10-Q") for further details.(2)

The mergers and acquisitions adjustment excludes net commission and fees revenue generated during the first 12 months following an acquisition. The total adjustment for the three months ended September 30, 2021 and three months ended September 30, 2020 was $44.4 million and $19.0 million, respectively.(3)

The other adjustments exclude the period-over-period change in contingent commissions, fiduciary investment income, and foreign exchange rates. The total adjustment for the three months ended September 30, 2021 and three months ended September 30, 2020 was $2.9 million and $1.9 million, respectively. September 30, 2021 revenue of $352.8 million less September 30, 2020 revenue of $236.8 million is a $116.0 million period-over-period change. The change, $116.0 million, divided by the September 30, 2020 revenue of $236.8 million is a total revenue change of 49.0%. September 30, 2020(1) revenue of $236.8 million less September 30, 2019 revenue of $193.5 million is a $43.3 million period-over-period change. The change, $43.3 million, divided by the September 30, 2019 revenue of $193.5 million is a total revenue change of 22.4%. Refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's 10-Q for the third quarter of 2021 to be filed with the SEC (the "10-Q") for further details. The mergers and acquisitions adjustment excludes net commission and fees(2) revenue generated during the first 12 months following an acquisition. The total adjustment for the three months ended September 30, 2021 and three months ended September 30, 2020 was $44.4 million and $19.0 million, respectively. The other adjustments exclude the period-over-period change in contingent(3) commissions, fiduciary investment income, and foreign exchange rates. The total adjustment for the three months ended September 30, 2021 and three months ended September 30, 2020 was $2.9 million and $1.9 million, respectively.Nine months endedSeptember 30,2021

2020

Total Revenue Growth Rate (GAAP) (1)52.5%

26.8%

Less: Mergers and Acquisitions (2)(26.7)

(7.5)

Change in Other (3)(0.2)

0.5

Organic Revenue Growth Rate (Non-GAAP)25.6%

19.8%

Nine months ended September 30, 2021 2020

Total Revenue Growth Rate (GAAP) (1) 52.5% 26.8%

Less: Mergers and Acquisitions (2) (26.7) (7.5)

Change in Other (3) (0.2) 0.5

Organic Revenue Growth Rate 25.6% 19.8%(Non-GAAP)(1)

September 30, 2021 revenue of $1,054.2 million less September 30, 2020 revenue of $691.3 million is a $362.9 million year-over-year change. The change, $362.9 million, divided by the September 30, 2020 revenue of $691.3 million is a total revenue change of 52.5%. September 30, 2020 revenue of $691.3 million less September 30, 2019 revenue of $545.3 million is a $146.1 million year-over-year change. The change, $146.1 million, divided by the September 30, 2019 revenue of $545.3 million is a total revenue change of 26.8%. Refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the 10-Q for further details.(2)

The mergers and acquisitions adjustment excludes net commission and fees revenue generated during the first 12 months following an acquisition. The total adjustment for the nine months ended September 30, 2021 and nine months ended September 30, 2020 was $184.4 million and $40.6 million, respectively.(3)

The other adjustments exclude the year-over-year change in contingent commissions, fiduciary investment income, and foreign exchange rates. The total adjustment for the nine months ended September 30, 2021 and 2020 was $1.2 million and $3.2 million, respectively. Reconciliation of Adjusted Compensation and Benefits Expense to Compensation and Benefits Expense

September 30, 2021 revenue of $1,054.2 million less September 30, 2020 revenue of $691.3 million is a $362.9 million year-over-year change. The change, $362.9 million, divided by the September 30, 2020 revenue of $691.3 million is a total revenue change of 52.5%. September 30, 2020(1) revenue of $691.3 million less September 30, 2019 revenue of $545.3 million is a $146.1 million year-over-year change. The change, $146.1 million, divided by the September 30, 2019 revenue of $545.3 million is a total revenue change of 26.8%. Refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the 10-Q for further details. The mergers and acquisitions adjustment excludes net commission and fees(2) revenue generated during the first 12 months following an acquisition. The total adjustment for the nine months ended September 30, 2021 and nine months ended September 30, 2020 was $184.4 million and $40.6 million, respectively. The other adjustments exclude the year-over-year change in contingent(3) commissions, fiduciary investment income, and foreign exchange rates. The total adjustment for the nine months ended September 30, 2021 and 2020 was $1.2 million and $3.2 million, respectively. Reconciliation of Adjusted Compensation and Benefits Expense to Compensation and Benefits Expense

Three months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 352,766 236,811

$ $ Compensation and Benefits Expense 286,538 162,981

Acquisition-related expense - (2,811)

Acquisition related long-term incentive (10,333) (3,419)compensationRestructuring and related expense (895) (3,301)

Amortization and expense related to (1,759) (1,974)discontinued prepaid incentivesEquity-based compensation (3,371) (2,422)

Discontinued programs expense - 4

Initial public offering related expense (57,590) -

$ $ Adjusted Compensation and Benefits Expense (1) 212,590 149,058

Compensation and Benefits Expense Ratio (2) 81.2% 68.8%

Adjusted Compensation and Benefits Expense 60.3% 62.9%Ratio (3)(1)

Adjustments to Compensation and Benefits Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2)

Compensation and Benefits Expense Ratio is Compensation and Benefits Expense as a percentage of total revenue.(3)

Adjusted Compensation and Benefits Expense Ratio is Adjusted Compensation and Benefits Expense as a percentage of total revenue.(1) Adjustments to Compensation and Benefits Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2) Compensation and Benefits Expense Ratio is Compensation and Benefits Expense as a percentage of total revenue.(3) Adjusted Compensation and Benefits Expense Ratio is Adjusted Compensation and Benefits Expense as a percentage of total revenue.Nine months endedSeptember 30,(in thousands, except percentages)2021

2020

Total Revenue$

1,054,236

$

691,327

Compensation and Benefits Expense$

737,825

$

461,094

Acquisition-related expense-

(4,423)

Acquisition related long-term incentive compensation(28,837)

(4,483)

Restructuring and related expense(9,246)

(3,301)

Amortization and expense related to discontinued prepaid incentives(5,441)

(7,037)

Equity-based compensation(11,259)

(7,153)

Discontinued programs expense-

(488)

Initial public offering related expense(57,590)

-

Adjusted Compensation and Benefits Expense (1)$

625,452

$

434,209

Compensation and Benefits Expense Ratio (2)70.0%

66.7%

Adjusted Compensation and Benefits Expense Ratio (3)59.3%

62.8%

Nine months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 1,054,236 691,327

$ $ Compensation and Benefits Expense 737,825 461,094

Acquisition-related expense - (4,423)

Acquisition related long-term incentive (28,837) (4,483)compensationRestructuring and related expense (9,246) (3,301)

Amortization and expense related to (5,441) (7,037)discontinued prepaid incentivesEquity-based compensation (11,259) (7,153)

Discontinued programs expense - (488)

Initial public offering related expense (57,590) -

$ $ Adjusted Compensation and Benefits Expense (1) 625,452 434,209

Compensation and Benefits Expense Ratio (2) 70.0% 66.7%

Adjusted Compensation and Benefits Expense 59.3% 62.8%Ratio (3)(1)

Adjustments to Compensation and Benefits Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2)

Compensation and Benefits Expense Ratio is Compensation and Benefits Expense as a percentage of total revenue.(3)

Adjusted Compensation and Benefits Expense Ratio is Adjusted Compensation and Benefits Expense as a percentage of total revenue. Reconciliation of Adjusted General and Administrative Expense to General and Administrative Expense

(1) Adjustments to Compensation and Benefits Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2) Compensation and Benefits Expense Ratio is Compensation and Benefits Expense as a percentage of total revenue.(3) Adjusted Compensation and Benefits Expense Ratio is Adjusted Compensation and Benefits Expense as a percentage of total revenue. Reconciliation of Adjusted General and Administrative Expense to General and Administrative Expense

Three months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 352,766 236,811

$ $ General and Administrative Expense 38,754 31,370

Acquisition-related expense (106) (9,792)

Restructuring and related expense (2,465) (397)

Discontinued programs expense - (698)

Other non-recurring expense - (90)

Initial public offering related expense (1,030) -

Adjusted General and Administrative $ $ Expense (1) 35,153 20,393

General and Administrative Expense Ratio 11.0% 13.2%(2)Adjusted General and Administrative 10.0% 8.6%Expense Ratio (3)(1)

Adjustments to General and Administrative Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2)

General and Administrative Expense Ratio is General and Administrative Expense as a percentage of total revenue.(3)

Adjusted General and Administrative Expense Ratio is Adjusted General and Administrative Expense as a percentage of total revenue.(1) Adjustments to General and Administrative Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2) General and Administrative Expense Ratio is General and Administrative Expense as a percentage of total revenue.(3) Adjusted General and Administrative Expense Ratio is Adjusted General and Administrative Expense as a percentage of total revenue.Nine months endedSeptember 30,(in thousands, except percentages)2021

2020

Total Revenue$

1,054,236

$

691,327

General and Administrative Expense$

96,984

$

81,755

Acquisition-related expense(2,128)

(13,783)

Restructuring and related expense(4,286)

(1,822)

Discontinued programs expense-

(601)

Other non-recurring expense(354)

(183)

Initial public offering related expense(1,346)

-

Adjusted General and Administrative Expense (1)$

88,870

$

65,366

General and Administrative Expense Ratio (2)9.2%

11.8%

Adjusted General and Administrative Expense Ratio (3)8.4%

9.5%

Nine months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 1,054,236 691,327

$ $ General and Administrative Expense 96,984 81,755

Acquisition-related expense (2,128) (13,783)

Restructuring and related expense (4,286) (1,822)

Discontinued programs expense - (601)

Other non-recurring expense (354) (183)

Initial public offering related expense (1,346) -

Adjusted General and Administrative $ $ Expense (1) 88,870 65,366

General and Administrative Expense Ratio 9.2% 11.8%(2)Adjusted General and Administrative 8.4% 9.5%Expense Ratio (3)(1)

Adjustments to General and Administrative Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2)

General and Administrative Expense Ratio is General and Administrative Expense as a percentage of total revenue.(3)

Adjusted General and Administrative Expense Ratio is Adjusted General and Administrative Expense as a percentage of total revenue. Reconciliation of Adjusted EBITDAC to Net Income

(1) Adjustments to General and Administrative Expense are described in the footnotes of the reconciliation of Adjusted EBITDAC to Net Income in "Reconciliation of Adjusted EBITDAC to Net Income."(2) General and Administrative Expense Ratio is General and Administrative Expense as a percentage of total revenue.(3) Adjusted General and Administrative Expense Ratio is Adjusted General and Administrative Expense as a percentage of total revenue. Reconciliation of Adjusted EBITDAC to Net Income

Three months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 352,766 236,811

$ $ Net Income (loss) (32,590) 10,796

Interest expense 21,193 10,859

Income tax expense (benefit) (5,368) 2,923

Depreciation 1,179 1,029

Amortization 26,982 15,640

Change in contingent consideration 43 (35)

$ $ EBITDAC 11,439 41,212

Acquisition-related expense (1) 106 12,603

Acquisition related long-term incentive 10,333 3,419compensation (2)Restructuring and related expense (3) 3,360 3,698

Amortization and expense related to 1,759 1,974discontinued prepaid incentives (4)Other non-operating loss (income) (5) 16,211 1,574

Equity-based compensation (6) 3,371 2,422

Discontinued programs expense (7) - 694

Other non-recurring expense (8) - 90

IPO related expenses (9) 58,620 -

(Income) from equity method investments in (176) (326)related party $ $ Adjusted EBITDAC (10) 105,023 67,360

Net Income (loss) Margin (11) (9.2)% 4.6%

Adjusted EBITDAC Margin (12) 29.8% 28.4%

(1)

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $2.8 million for the three months ended September 30, 2020, while General and administrative expenses contributed to $0.1 million and $9.8 million of the acquisition-related expense for the three months ended September 30, 2021 and 2020, respectively.(2)

Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions.(3)

Restructuring and related expense consists of compensation and benefits of $0.9 million and $3.3 million for the three months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $2.5 million and $0.4 million for the three months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5. Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(4)

Amortization and expense related to discontinued prepaid incentive programs - see the 10-Q, Unaudited Note 15. Employee Benefit Plans, Prepaid and Long-Term Incentives.(5)

Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $16.2 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the three months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(6)

Equity-based compensation reflects non-cash equity-based expense.(7)

Discontinued programs expense includes $0.1 million of General and administrative expense for the three months ended September 30, 2020. Compensation and benefits expense was $0.0 million for the three months ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.6 million related to additional cancellation activity associated with these programs in the three months ended September 30, 2020.(8)

Other non-recurring items include one-time professional services costs associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes.(9)

Initial public offering related expenses includes $1.0 million of General and administrative expense associated with the preparations for Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the three months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(10)

Consolidated Adjusted EBITDAC does not reflect a deduction for the Adjusted EBITDAC associated with the non-controlling interest in Ryan Re.(11)

Net Income Margin is Net Income as a percentage of total revenue.(12)

Adjusted EBITDAC margin is Adjusted EBITDAC as a percentage of total revenue. Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $2.8 million(1) for the three months ended September 30, 2020, while General and administrative expenses contributed to $0.1 million and $9.8 million of the acquisition-related expense for the three months ended September 30, 2021 and 2020, respectively.(2) Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions. Restructuring and related expense consists of compensation and benefits of $0.9 million and $3.3 million for the three months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $2.5 million and(3) $0.4 million for the three months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5. Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(4) Amortization and expense related to discontinued prepaid incentive programs - see the 10-Q, Unaudited Note 15. Employee Benefit Plans, Prepaid and Long-Term Incentives. Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $16.2 million is due to the occurrence of a(5) Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the three months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(6) Equity-based compensation reflects non-cash equity-based expense.

Discontinued programs expense includes $0.1 million of General and administrative expense for the three months ended September 30, 2020. Compensation and benefits expense was $0.0 million for the three months(7) ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.6 million related to additional cancellation activity associated with these programs in the three months ended September 30, 2020. Other non-recurring items include one-time professional services costs(8) associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes. Initial public offering related expenses includes $1.0 million of General and administrative expense associated with the preparations for(9) Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the three months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(10) Consolidated Adjusted EBITDAC does not reflect a deduction for the Adjusted EBITDAC associated with the non-controlling interest in Ryan Re.(11) Net Income Margin is Net Income as a percentage of total revenue.

(12) Adjusted EBITDAC margin is Adjusted EBITDAC as a percentage of total revenue.Nine months endedSeptember 30,(in thousands, except percentages)2021

2020

Total Revenue$

1,054,236

$

691,327

Net Income$

27,016

$

74,001

Interest expense60,224

26,295

Income tax expense (benefit)(802)

6,085

Depreciation3,601

2,658

Amortization82,095

34,789

Change in contingent consideration2,356

997

EBITDAC$

174,490

$

144,825

Acquisition-related expense (1)2,128

18,206

Acquisition related long-term incentive compensation (2)28,837

4,483

Restructuring and related expense (3)13,532

5,123

Amortization and expense related to discontinued prepaid incentives (4)5,441

7,037

Other non-operating loss (income) (5)45,547

4,066

Equity-based compensation (6)11,259

7,153

Discontinued programs expense (7)-

1,089

Other non-recurring expense (8)354

183

IPO related expenses (9)58,936

-

(Income) from equity method investments in related party(610)

(413)

Adjusted EBITDAC (10)$

339,914

$

191,752

Net Income Margin (11)2.6%

10.7%

Adjusted EBITDAC Margin (12)32.2%

27.7%

Nine months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 1,054,236 691,327

$ $ Net Income 27,016 74,001

Interest expense 60,224 26,295

Income tax expense (benefit) (802) 6,085

Depreciation 3,601 2,658

Amortization 82,095 34,789

Change in contingent consideration 2,356 997

$ $ EBITDAC 174,490 144,825

Acquisition-related expense (1) 2,128 18,206

Acquisition related long-term incentive 28,837 4,483compensation (2)Restructuring and related expense (3) 13,532 5,123

Amortization and expense related to 5,441 7,037discontinued prepaid incentives (4)Other non-operating loss (income) (5) 45,547 4,066

Equity-based compensation (6) 11,259 7,153

Discontinued programs expense (7) - 1,089

Other non-recurring expense (8) 354 183

IPO related expenses (9) 58,936 -

(Income) from equity method investments in (610) (413)related party $ $ Adjusted EBITDAC (10) 339,914 191,752

Net Income Margin (11) 2.6% 10.7%

Adjusted EBITDAC Margin (12) 32.2% 27.7%

(1)

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $4.4 million for the nine months ended September 30, 2020, while General and administrative expenses contributed to $2.1 million and $13.8 million of the acquisition-related expense for the nine months ended September 30, 2021 and 2020, respectively.(2)

Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions(3)

Restructuring and related expense consists of compensation and benefits of $9.2 million and $3.3 million for the nine months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $4.3 million and $1.8 million for the nine months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5. Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(4)

Amortization and expense related to discontinued prepaid incentive programs - see the 10-Q, Unaudited Note 15. Employee Benefit Plans, Prepaid and Long-Term Incentives.(5)

Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $36.9 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the nine months ended September 30, 2021, non-operating loss (income) includes costs associated with the extinguishment of a portion of our deferred debt issuance costs on the term debt. For the nine months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(6)

Equity-based compensation reflects non-cash equity-based expense.(7)

Discontinued programs expense includes $0.3 million of General and administrative expense for the nine months ended September 30, 2020. Compensation and benefits expense was $0.5 million for the nine months ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.3 million related to additional cancellation activity associated with these programs in the nine months ended September 30, 2020.(8)

Other non-recurring items include one-time professional services costs associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes.(9)

Initial public offering related expenses includes $1.3 million of General and administrative expense associated with the preparations for Sarbanes- Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the nine months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(10)

Consolidated Adjusted EBITDAC does not reflect a deduction for the Adjusted EBITDAC associated with the non-controlling interest in Ryan Re.(11)

Net Income Margin is Net Income as a percentage of total revenue.(12)

Adjusted EBITDAC margin is Adjusted EBITDAC as a percentage of total revenue. Reconciliation of Adjusted Net Income to Net Income

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $4.4 million(1) for the nine months ended September 30, 2020, while General and administrative expenses contributed to $2.1 million and $13.8 million of the acquisition-related expense for the nine months ended September 30, 2021 and 2020, respectively.(2) Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions Restructuring and related expense consists of compensation and benefits of $9.2 million and $3.3 million for the nine months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $4.3 million and(3) $1.8 million for the nine months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5. Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(4) Amortization and expense related to discontinued prepaid incentive programs - see the 10-Q, Unaudited Note 15. Employee Benefit Plans, Prepaid and Long-Term Incentives. Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $36.9 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified(5) Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the nine months ended September 30, 2021, non-operating loss (income) includes costs associated with the extinguishment of a portion of our deferred debt issuance costs on the term debt. For the nine months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(6) Equity-based compensation reflects non-cash equity-based expense.

Discontinued programs expense includes $0.3 million of General and administrative expense for the nine months ended September 30, 2020. Compensation and benefits expense was $0.5 million for the nine months(7) ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.3 million related to additional cancellation activity associated with these programs in the nine months ended September 30, 2020. Other non-recurring items include one-time professional services costs(8) associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes. Initial public offering related expenses includes $1.3 million of General and administrative expense associated with the preparations for(9) Sarbanes- Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the nine months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(10) Consolidated Adjusted EBITDAC does not reflect a deduction for the Adjusted EBITDAC associated with the non-controlling interest in Ryan Re.(11) Net Income Margin is Net Income as a percentage of total revenue.

(12) Adjusted EBITDAC margin is Adjusted EBITDAC as a percentage of total revenue. Reconciliation of Adjusted Net Income to Net Income

Three months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 352,766 236,811

$ $ Net Income (loss) (32,590) 10,796

Income tax expense (benefit) (5,368) 2,923

Amortization 26,982 15,640

Amortization of deferred issuance costs (1) 2,777 1,070

Change in contingent consideration 43 (35)

Acquisition-related expense (2) 106 12,603

Acquisition related long-term incentive 10,333 3,419compensation (3)Restructuring expense (4) 3,360 3,698

Amortization and expense related to 1,759 1,974discontinued prepaid incentives (5)Other non-operating loss (income) (6) 16,211 1,574

Equity-based compensation (7) 3,371 2,422

Discontinued programs expense (8) - 694

Other non-recurring expense (9) - 90

IPO related expenses (10) 58,620 -

(Income) / loss from equity method investments (176) (326)in related party $ $ Adjusted Income before Income Taxes 85,428 56,542

Adjusted tax expense (11) (22,479) (14,878)

$ $ Adjusted Net Income (12) 62,949 41,664

Net Income (loss) Margin (13) (9.2)% 4.6%

Adjusted Net Income Margin (14) 17.8% 17.6%

(1)

Interest Expense includes amortization of deferred issuance costs.(2)

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $2.8 million for the three months ended September 30, 2020, while General and administrative expenses contributed to $0.1 million and $9.8 million of the acquisition-related expense for the three months ended September 30, 2021 and 2020, respectively.(3)

Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions.(4)

Restructuring and related expense consists of compensation and benefits of $0.9 million and $3.3 million for the three months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $2.5 million and $0.4 million for the three months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5, Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(5)

Amortization and expense related to discontinued prepaid incentive programs-see the 10-Q, Unaudited Note 15, Employee Benefit Plans, Prepaid and Long-Term Incentives.(6)

Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $16.2 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the three months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(7)

Equity-based compensation reflects non-cash equity-based expense.(8)

Discontinued programs expense includes $0.1 million of General and administrative expense for the three months ended September 30, 2020. Compensation and benefits expense was $0.0 million for the three months ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.6 million related to additional cancellation activity associated with these programs in the three months ended September 30, 2020.(9)

Other non-recurring items include one-time professional services costs associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes.(10)

Initial public offering related expenses includes $1.0 million of General and administrative expense associated with the preparations for Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the three months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(11)

Ryan Specialty Group Holdings, Inc. will be subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect to our allocable share of any net taxable income of Ryan Specialty Group, LLC. For comparability purposes, this calculation of adjusted tax expense incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of Ryan Specialty Group, LLC.(12)

Consolidated Adjusted Net Income does not reflect a deduction for the Adjusted Net Income associated with the non-controlling interest in Ryan Re.(13)

Net Income Margin is Net Income as a percentage of total revenue.(14)

Adjusted Net Income Margin is Adjusted Net Income as a percentage of total revenue.(1) Interest Expense includes amortization of deferred issuance costs.

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $2.8 million(2) for the three months ended September 30, 2020, while General and administrative expenses contributed to $0.1 million and $9.8 million of the acquisition-related expense for the three months ended September 30, 2021 and 2020, respectively.(3) Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions. Restructuring and related expense consists of compensation and benefits of $0.9 million and $3.3 million for the three months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $2.5 million and(4) $0.4 million for the three months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5, Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(5) Amortization and expense related to discontinued prepaid incentive programs-see the 10-Q, Unaudited Note 15, Employee Benefit Plans, Prepaid and Long-Term Incentives. Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $16.2 million is due to the occurrence of a(6) Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the three months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(7) Equity-based compensation reflects non-cash equity-based expense.

Discontinued programs expense includes $0.1 million of General and administrative expense for the three months ended September 30, 2020. Compensation and benefits expense was $0.0 million for the three months(8) ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.6 million related to additional cancellation activity associated with these programs in the three months ended September 30, 2020. Other non-recurring items include one-time professional services costs(9) associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes. Initial public offering related expenses includes $1.0 million of General and administrative expense associated with the preparations for(10) Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the three months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO. Ryan Specialty Group Holdings, Inc. will be subject to United States federal income taxes, in addition to state, local, and foreign taxes,(11) with respect to our allocable share of any net taxable income of Ryan Specialty Group, LLC. For comparability purposes, this calculation of adjusted tax expense incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of Ryan Specialty Group, LLC.(12) Consolidated Adjusted Net Income does not reflect a deduction for the Adjusted Net Income associated with the non-controlling interest in Ryan Re.(13) Net Income Margin is Net Income as a percentage of total revenue.

(14) Adjusted Net Income Margin is Adjusted Net Income as a percentage of total revenue.Nine months endedSeptember 30,(in thousands, except percentages)2021

2020

Total Revenue$

1,054,236

$

691,327

Net Income$

27,016

$

74,001

Income tax expense (benefit)(802)

6,085

Amortization82,095

34,789

Amortization of deferred issuance costs (1)8,546

1,763

Change in contingent consideration2,356

997

Acquisition-related expense (2)2,128

18,206

Acquisition related long-term incentive compensation (3)28,837

4,483

Restructuring expense (4)13,532

5,123

Amortization and expense related to discontinued prepaid incentives (5)5,441

7,037

Other non-operating loss (income) (6)45,547

4,066

Equity-based compensation (7)11,259

7,153

Discontinued programs expense (8)-

1,089

Other non-recurring items (9)354

183

IPO related expenses (10)58,936

-

(Income) / loss from equity method investments in related party(610)

(413)

Adjusted Income before Income Taxes$

284,635

$

164,562

Adjusted tax expense (11)(74,896)

(43,301)

Adjusted Net Income (12)$

209,739

$

121,261

Net Income Margin (13)2.6%

10.7%

Adjusted Net Income Margin (14)19.9%

17.5%

Nine months ended September 30, (in thousands, except percentages) 2021 2020

$ $ Total Revenue 1,054,236 691,327

$ $ Net Income 27,016 74,001

Income tax expense (benefit) (802) 6,085

Amortization 82,095 34,789

Amortization of deferred issuance costs (1) 8,546 1,763

Change in contingent consideration 2,356 997

Acquisition-related expense (2) 2,128 18,206

Acquisition related long-term incentive 28,837 4,483compensation (3)Restructuring expense (4) 13,532 5,123

Amortization and expense related to 5,441 7,037discontinued prepaid incentives (5)Other non-operating loss (income) (6) 45,547 4,066

Equity-based compensation (7) 11,259 7,153

Discontinued programs expense (8) - 1,089

Other non-recurring items (9) 354 183

IPO related expenses (10) 58,936 -

(Income) / loss from equity method investments (610) (413)in related party $ $ Adjusted Income before Income Taxes 284,635 164,562

Adjusted tax expense (11) (74,896) (43,301)

$ $ Adjusted Net Income (12) 209,739 121,261

Net Income Margin (13) 2.6% 10.7%

Adjusted Net Income Margin (14) 19.9% 17.5%

(1)

Interest Expense includes amortization of deferred issuance costs.(2)

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $4.4 million for the nine months ended September 30, 2020, while General and administrative expenses contributed to $2.1 million and $13.8 million of the acquisition-related expense for the nine months ended September 30, 2021 and 2020, respectively.(3)

Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions.(4)

Restructuring and related expense consists of compensation and benefits of $9.2 million and $3.3 million for the nine months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $4.3 million and $1.8 million for the nine months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5, Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs.(5)

Amortization and expense related to discontinued prepaid incentive programs-see the 10-Q, Unaudited Note 15, Employee Benefit Plans, Prepaid and Long-Term Incentives in the consolidated financial statements.(6)

Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $36.9 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the nine months ended September 30, 2021, non-operating loss (income) includes costs associated with the extinguishment of a portion of our deferred debt issuance costs on the term debt. For the nine months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(7)

Equity-based compensation reflects non-cash equity-based expense.(8)

Discontinued programs expense includes $0.3 million of General and administrative expense for the nine months ended September 30, 2020. Compensation and benefits expense was $0.5 million for the nine months ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.3 million related to additional cancellation activity associated with these programs in the nine months ended September 30, 2020(9)

Other non-recurring items include one-time professional services costs associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes.(10)

Initial public offering related expenses includes $1.3 million of General and administrative expense associated with the preparations for Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the nine months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO.(11)

Ryan Specialty Group Holdings, Inc. will be subject to United States federal income taxes, in addition to state, local, and foreign taxes, with respect to our allocable share of any net taxable income of Ryan Specialty Group, LLC. For comparability purposes, this calculation of adjusted tax expense incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of Ryan Specialty Group, LLC.(12)

Consolidated Adjusted Net Income does not reflect a deduction for the Adjusted Net Income associated with the non-controlling interest in Ryan Re.(13)

Net Income Margin is Net Income as a percentage of total revenue.(14)

Adjusted Net Income Margin is Adjusted Net Income as a percentage of total revenue. Reconciliation of Adjusted Diluted Earnings per Share to Diluted Earnings per Share

(1) Interest Expense includes amortization of deferred issuance costs.

Acquisition-related expense includes diligence, transaction-related, and integration costs. Compensation and benefits expenses were $4.4 million(2) for the nine months ended September 30, 2020, while General and administrative expenses contributed to $2.1 million and $13.8 million of the acquisition-related expense for the nine months ended September 30, 2021 and 2020, respectively.(3) Acquisition related long-term incentive compensation arises from long-term incentive plans associated with acquisitions. Restructuring and related expense consists of compensation and benefits of $9.2 million and $3.3 million for the nine months ended September 30, 2021 and 2020, respectively, and General and administrative costs including occupancy and professional services fees of $4.3 million and(4) $1.8 million for the nine months ended September 30, 2021 and 2020, respectively, related to the Restructuring Plan. The compensation and benefits expense includes severance as well as employment costs related to services rendered between the notification and termination dates. See the 10-Q, Unaudited Note 5, Restructuring. The remaining costs that preceded the Restructuring Plan were associated with organizational design, other severance, and non-recurring lease costs. Amortization and expense related to discontinued prepaid incentive(5) programs-see the 10-Q, Unaudited Note 15, Employee Benefit Plans, Prepaid and Long-Term Incentives in the consolidated financial statements. Other non-operating loss (income) includes the change in fair value of the embedded derivatives on the redeemable Class B preferred units. This change in fair value of $36.9 million is due to the occurrence of a Realization Event in the third quarter, which is defined as a Qualified(6) Public Offering or a Sale Transaction in the Onex Purchase Agreement. See the 10-Q, Unaudited Note 11, Redeemable Preferred Units. For the nine months ended September 30, 2021, non-operating loss (income) includes costs associated with the extinguishment of a portion of our deferred debt issuance costs on the term debt. For the nine months ended September 30, 2020, non-operating loss (income) includes the change in fair value of interest rate swaps which were discontinued in 2020.(7) Equity-based compensation reflects non-cash equity-based expense.

Discontinued programs expense includes $0.3 million of General and administrative expense for the nine months ended September 30, 2020. Compensation and benefits expense was $0.5 million for the nine months(8) ended September 30, 2020. These costs were associated with concluding specific programs that are no longer core to our business. This adjustment also includes $0.3 million related to additional cancellation activity associated with these programs in the nine months ended September 30, 2020 Other non-recurring items include one-time professional services costs(9) associated with term debt repricing, and one-time non-income tax charges and tax and accounting consultancy costs associated with potential structure changes. Initial public offering related expenses includes $1.3 million of General and administrative expense associated with the preparations for(10) Sarbanes-Oxley compliance, tax and accounting advisory services on IPO-related structure changes, and Compensation-related expense of $57.6 million for the nine months ended September 30, 2021 related to the revaluation of existing equity awards at IPO as well as initial period expense for new awards issued at IPO. Ryan Specialty Group Holdings, Inc. will be subject to United States federal income taxes, in addition to state, local, and foreign taxes,(11) with respect to our allocable share of any net taxable income of Ryan Specialty Group, LLC. For comparability purposes, this calculation of adjusted tax expense incorporates the impact of federal and state statutory tax rates on 100% of our adjusted pre-tax income as if the Company owned 100% of Ryan Specialty Group, LLC.(12) Consolidated Adjusted Net Income does not reflect a deduction for the Adjusted Net Income associated with the non-controlling interest in Ryan Re.(13) Net Income Margin is Net Income as a percentage of total revenue.

(14) Adjusted Net Income Margin is Adjusted Net Income as a percentage of total revenue. Reconciliation of Adjusted Diluted Earnings per Share to Diluted Earnings per Share

Three months ended September 30, 2021 Adjustments Plus: Net income Plus: Impact of all Plus: Plus: Dilutive Adjusted (loss) attributable LLC Common Adjustments impact of Diluted U.S. GAAP to RSG LLC before Units exchanged to Adjusted unvested Earnings the Organizational for Class A shares Net Income equity awards per Share Transactions (1) (2) (3) Numerator:Net income(loss)attributable $ $ $ $ $ $ to Class A (17,115) 15,781 (31,256) 95,539 - 62,949commonshareholders-dilutedDenominator: Weighted-averageshares of Class A common 105,309 - 142,727 - 19,684 267,721stockoutstanding-dilutedNet income(loss) per $ $ $ $ $ $ share of Class A (0.16) 0.15 (0.12) 0.39 (0.02) 0.24commonstock - diluted(1)

For comparability purposes, this calculation incorporates the net income (loss) and weighted average shares of Class A common stock that would be outstanding if all LLC Common Units (together with shares of Class B common stock) were exchanged for shares of Class A common stock.(2)

Adjustments to Adjusted Net Income are described in the footnotes of the reconciliation of Adjusted Net Income to Net Income in "Adjusted Net Income and Adjusted Net Income Margin".(3)

For comparability purposes and to be consistent with the treatment of the adjustments to arrive at Adjusted Net Income, the dilutive effect of unvested equity awards is calculated using the treasury stock method as if the weighted average unrecognized cost associated with the awards was $0 over the period, less any unvested equity awards determined to be dilutive within the Diluted Loss Per Share calculation disclosed in Note 13, Loss Per Share of the unaudited quarterly consolidated financial statements. For comparability purposes, this calculation incorporates the net income(1) (loss) and weighted average shares of Class A common stock that would be outstanding if all LLC Common Units (together with shares of Class B common stock) were exchanged for shares of Class A common stock.(2) Adjustments to Adjusted Net Income are described in the footnotes of the reconciliation of Adjusted Net Income to Net Income in "Adjusted Net Income and Adjusted Net Income Margin". For comparability purposes and to be consistent with the treatment of the adjustments to arrive at Adjusted Net Income, the dilutive effect of unvested equity awards is calculated using the treasury stock method as(3) if the weighted average unrecognized cost associated with the awards was $0 over the period, less any unvested equity awards determined to be dilutive within the Diluted Loss Per Share calculation disclosed in Note 13, Loss Per Share of the unaudited quarterly consolidated financial statements.Nine months ended September 30, 2021AdjustmentsU.S. GAAPPlus: Net income(loss) attributableto RSG LLC beforethe OrganizationalTransactionsPlus: Impact of allLLC CommonUnits exchangedfor Class A shares(1)Plus:Adjustmentsto AdjustedNet Income(2)Plus: Dilutiveimpact ofunvestedequity awards(3)AdjustedDilutedEarnings perShareNumerator:Net income (loss) attributableto Class A commonshareholders- diluted$ (17,115)

$ 75,387

$ (31,256)

$ 182,723

$ -

$ 209,739

Denominator:Weighted-average shares ofClass A common stockoutstanding- diluted105,309

-

142,727

-

19,684

267,721

Net income (loss) pershare of Class A commonstock - diluted$ (0.16)

$ 0.72

$ (0.44)

$ 0.74

$ (0.06)

$ 0.78

Nine months ended September 30, 2021 Adjustments Plus: Net income Plus: Impact of all Plus: Plus: Dilutive Adjusted U.S. (loss) attributable LLC Common Adjustments impact of Diluted GAAP to RSG LLC before Units exchanged to Adjusted unvested Earnings the Organizational for Class A shares Net Income equity awards per Transactions (1) (2) (3) Share Numerator:Net income(loss)attributable $ $ $ $ $ $ to Class A (17,115) 75,387 (31,256) 182,723 - 209,739commonshareholders-dilutedDenominator: Weighted-averageshares of Class A common 105,309 - 142,727 - 19,684 267,721stockoutstanding-dilutedNet income(loss) per $ $ $ $ $ $ share of Class A (0.16) 0.72 (0.44) 0.74 (0.06) 0.78commonstock - diluted(1)

For comparability purposes, this calculation incorporates the net income (loss) and weighted average shares of Class A common stock that would be outstanding if all LLC Common Units (together with shares of Class B common stock) were exchanged for shares of Class A common stock.(2)

Adjustments to Adjusted Net Income are described in the footnotes of the reconciliation of Adjusted Net Income to Net Income in "Adjusted Net Income and Adjusted Net Income Margin".(3)

For comparability purposes and to be consistent with the treatment of the adjustments to arrive at Adjusted Net Income, the dilutive effect of unvested equity awards is calculated using the treasury stock method as if the weighted average unrecognized cost associated with the awards was $0 over the period, less any unvested equity awards determined to be dilutive within the Diluted Loss Per Share calculation disclosed in Note 13, Loss Per Share of the unaudited quarterly consolidated financial statements. View source version on businesswire.com: https://www.businesswire.com/news/home/20211111005994/en/

CONTACT: Investor Relations Noah Angeletti SVP, Treasurer Ryan Specialty Group IR@ryansg.com Phone: (312) 784-6152 Media Relations Alice Phillips Topping SVP, Chief Marketing & Communications Officer Ryan Specialty Group Alice.Topping@ryansg.com Phone: (312) 635-5976