Public Policy Regulatory News (PPHC)

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this announcement via a Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.

Public Policy Holding Company, Inc.

("PPHC", the "Group" or the "Company")

Business Update

 Public Policy Holding Company, Inc., the government relations and public affairs group providing clients with a fully integrated and comprehensive range of services, is pleased to provide an update on its M&A pipeline, current trading and employee shareholding.

M&A pipeline and strategy

Following the successful completion of the earnings accretive acquisitions of KP Public Affairs in October 2022 and MultiState Associates in March 2023, the Group has seen a marked acceleration in its pipeline of M&A opportunities and looks forward to updating shareholders in the second half of the year to the extent these current opportunities crystallise.

The Group's stated M&A strategy includes its desire to add certain complementary specialisations to its portfolio, as well as to expand its footprint both in the United States and internationally into the EU and UK.

The Group continues to adopt a disciplined approach to its M&A strategy with a focus on:

· Best in class ethical and compliance standards in place at target companies;

· Resultant market share and diversification benefits;

· Attractive financial profiles;

· Long term revenue synergy potential;

· Sufficient level of scale and institutionalisation; and

· Negotiating deal structures that align the owners of the target with the Group in the long term and deliver shareholder value.

Current trading

The Group reiterates existing guidance for FY23 and expects organic growth for the year to be 5% to 10%. Overall, management expects revenue growth for the year of between 20% and 30%, factoring in the incremental contribution from KP Public Affairs and Multistate Associates.

The Group continues to manage the business such that the Underlying EBITDA margin is expected to be between 25% and 30% on a full year basis. The Group saw moderated growth in Q1 primarily as a result of delays in U.S. Congress formation, however Q2 to date has been strong. H1 margins are therefore anticipated to be marginally below 25%, which is expected to reverse through H2. Management retains immediate and long-term confidence in the Group's growth and margin prospects.

Dividend and cash

Following the payment of the FY22 final dividend of $10.6m on 2 June 2023, the Group had gross cash on its balance sheet of $4m and $13m debt outstanding under its $17m credit facility with Bank of America, N.A., resulting in a net debt position of $9m. The Group continues to accumulate cash on a monthly basis and the next dividend is due to be paid in October 2023 following the announcement of the interim results for the six months ending 30 June 2023.

The Group views its current dividend policy and the payment of semi-annual dividends as a key tool in the alignment of its internal (employee) shareholders and external shareholders and as validation of the strong free cash flow generation of the business.

The Group expects to announce its interim results for the six months ending 30 June 2023 in September 2023.

Employee Shareholding

As at the date of the Group's IPO on 16 December 2021, an aggregate of 80,354,500 shares (74.2% of total issued shares at admission) were held by employee shareholders and subject to a five-year vesting schedule with vesting occurring in equal instalments on each of the first five anniversaries from admission. Following the first vesting on 16 December 2022, no employee-owned shares have been sold and those employees are now unable to sell due to the current blackout period until after the release of the Group's interim results. Management views this stable employee shareholding situation as a testament to the belief the Group's employees hold in the Group's future prospects.

Enquiries

About PPHC

Incorporated in 2014, PPHC is a US-based government relations and public affairs group providing clients with a fully integrated and comprehensive range of services including government and public relations, research and digital advocacy campaigns. Retained by over two-thirds of its 1000+ clients, including corporates, trade associations and non-governmental organisations, the Group is active in all major sectors of the U.S. economy, including healthcare and pharmaceuticals, financial services, energy, technology, telecoms and transportation. PPHC's services support clients to enhance and defend their reputations, advance policy goals, manage regulatory risk, and engage with US federal and state-level policy makers, stakeholders, media and the public.

PPHC operates a holding company structure and currently has seven operating entities comprising Crossroads Strategies, Forbes Tate Partners, Seven Letter, O'Neill & Associates, Alpine Group Partners, KP Public Affairs and MultiState Associates. Operating in the strategic communications market, the Group has a strong track record of organic and acquisitive growth, the latter focused on enhancing its capabilities and to establish new verticals, either within new geographies or new related offerings.

For more information, see www.pphcompany.com.