Spetner Reports 95% Revenue Growth and Tripled Net Income in Q1 2025, Highlighting Strong Profitability and Cash Flows Ahead of Planned AcquisitionLAKEWOOD, NJ, June 26, 2025 (GLOBE NEWSWIRE) -- Reliance Global Group, Inc. (Nasdaq: RELI) (“Reliance,” “we,” “us,” “our” or the “Company”) today highlighted the strong preliminary unaudited financial results of Spetner Associates, Inc. (“Spetner”) for the first quarter ended March 31, 2025. As previously announced, Reliance has entered into a definitive agreemen ...

Group 1 - Reliance Global Group, Inc. has announced a private placement for the issuance and sale of 1,488,096 shares of common stock and short-term warrants to purchase up to 2,976,192 shares at a price of $1.68 per share, with expected gross proceeds of approximately $2.5 million [1][3] - The short-term warrants will be exercisable at an exercise price of $1.43 per share and will expire two years from the effective date of the Resale Registration Statement [1][3] - The company intends to use the net proceeds from the offering for working capital and general corporate purposes [3] Group 2 - H.C. Wainwright & Co. is acting as the exclusive placement agent for the offering [2] - The securities offered in the private placement are not registered under the Securities Act and are only available to accredited investors [4] - The company has agreed to file registration statements with the SEC covering the resale of the shares and shares issuable upon exercise of the warrants [4] Group 3 - Reliance Global Group, Inc. is an InsurTech pioneer utilizing AI and cloud-based technologies to enhance efficiencies in the insurance agency and brokerage industry [6] - The company's platform, RELI Exchange, provides independent insurance agencies with business development tools to compete effectively with larger agencies [6] - Reliance also operates a consumer platform, 5minuteinsure.com, which offers competitive online insurance quotes for auto, home, and life insurance [6]

Core Viewpoint - Reliance Global Group, Inc. has signed a non-binding Letter of Intent to sell Fortman Insurance Agency for $5 million, indicating a strategic move to unlock capital for the acquisition of Spetner Associates, which is expected to enhance shareholder value and operational efficiency [1][3][4]. Group 1: Transaction Details - The sale price of $5 million represents a significant premium over the original acquisition cost of Fortman, showcasing the company's ability to enhance and monetize its assets [1][3]. - Proceeds from the sale are intended to support the acquisition of Spetner Associates, a rapidly growing insurance platform that is expected to generate strong cash flow [3][4]. Group 2: Operational Enhancements - Since its acquisition, Reliance has made operational improvements at Fortman, including upgrading internal systems and establishing a strong leadership team, resulting in a well-capitalized agency with a growing customer base [2]. - The company aims to replace Fortman with Spetner to align with its long-term vision for scale, synergy, and sustained cash flow generation [4]. Group 3: Strategic Vision - The CEO of Reliance emphasized that the potential sale of Fortman reflects a disciplined capital allocation strategy and a commitment to value creation, highlighting the underlying value across the company's broader portfolio [3]. - Reliance's strategy focuses on pursuing transformative and accretive growth opportunities within the InsurTech and insurance agency industries [4].

Core Viewpoint - Reliance Global Group, Inc. has filed a request for withdrawal of its Registration Statement on Form S-1 with the SEC, indicating it will not pursue a public offering at this time [1] Company Overview - Reliance Global Group, Inc. is an InsurTech pioneer utilizing artificial intelligence and cloud-based technologies to enhance efficiencies in the insurance agency and brokerage industry [3] - The company's B2B platform, RELI Exchange, offers independent insurance agencies a suite of business development tools to compete with larger national agencies while reducing operational costs [3] - The B2C platform, 5minuteinsure.com, provides quick online insurance quotes for auto, home, and life insurance using AI and data mining [3] - The company also operates a portfolio of retail insurance agencies across the United States, offering a variety of insurance products [3]

Reliance Global Group Inc (RELI) Q1 2025 Earnings Call May 14, 2025 04:30 PM ET Company Participants Theodore Ayvas - Vice PresidentEzra Beyman - CEO & Executive ChairmanJoel Markovits - Chief Financial Officer Conference Call Participants None - Analyst Operator Good day, everyone. Welcome to the Reliance Global Group First Quarter Business Update Conference Call. At this time, all participants have been placed on a listen only mode, and the floor will be open for your questions and comments after the pres ...

Financial Data and Key Metrics Changes - Commission income increased by $154,000 or 4% to $4,200,000 in Q1 2025 compared to $4,100,000 in Q1 2024, reflecting organic growth across insurance distribution channels [12] - Net loss decreased by $3,600,000 or 68% to $1,700,000 in Q1 2025 versus $5,300,000 in Q1 2024, attributed to improved operational efficiency and reduced impairment charges [14] - Adjusted EBITDA improved significantly by 300% from a loss of $74,000 in Q1 2024 to a gain of $145,000 in Q1 2025, indicating a trend towards sustained profitability [14][15] Business Line Data and Key Metrics Changes - The launch of Reliance Auto Leasing is a significant development, allowing agency partners to offer vehicle leasing, which is expected to enhance client relationships and create a recurring revenue stream [8][9] - The acquisition of Spetner Associates is anticipated to expand market footprint and enhance agency network, contributing to revenue growth and margin improvement [9][10] Market Data and Key Metrics Changes - The company is focused on expanding its market share through innovative services and strategic acquisitions, positioning itself for scalable long-term growth [8][10] Company Strategy and Development Direction - The company emphasizes a disciplined financial approach and a streamlined operating model to enhance profitability and market presence [6][8] - Reliance Global Group is committed to innovation and disciplined growth, with a focus on expanding services for agency partners and increasing revenue opportunities [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's trajectory towards scalable long-term growth, supported by new service offerings and strategic acquisitions [10][11] - The positive feedback from agents regarding new services indicates strong market acceptance and potential for future growth [9] Other Important Information - The company is nearing completion of the Bettner Associates acquisition, which is expected to create immediate cross-selling opportunities and enhance overall capabilities [9][10] Q&A Session Summary Question: Insights on the Septner acquisition benefits - The acquisition is expected to significantly increase EBITDA positivity and revenue, with potential for substantial cross-selling opportunities due to access to new insurance products [18][19] Question: Key drivers behind positive adjusted EBITDA - Positive adjusted EBITDA is driven by a combination of revenue growth, expense streamlining, and a focus on cost efficiency, with expectations for continued improvement through technology [20][21]

Acquisition Strategy - As of March 31, 2025, the Company has acquired nine insurance agencies as part of its aggressive acquisition strategy[61] - The Company plans to acquire 80% of Spetner Associates for $16,050,000, which includes $6,500,000 in cash and the issuance of common stock and promissory notes[62] - The Company focuses on acquiring undervalued wholesale and retail insurance agencies in growing or underserved segments, including healthcare and Medicare[68] - The Company aims to expand its business through continued asset acquisitions and organic growth over the next 12 months[62] Financial Performance - Commission income for Q1 2025 was $4,236,220, a 4% increase from $4,082,438 in Q1 2024[77] - Total operating expenses decreased by 38% to $5,643,362 in Q1 2025 from $9,114,159 in Q1 2024[77] - Net loss improved to $(1,736,882) in Q1 2025, a 68% reduction from $(5,346,663) in Q1 2024[79] - AEBITDA for Q1 2025 was $145,407, compared to $(73,654) in Q1 2024, representing a significant turnaround[79] - Cash balance as of March 31, 2025, was approximately $1,812,000, with negative working capital of approximately $77,000[80] - Net cash provided by operating activities was $197,830 in Q1 2025, compared to net cash used of $(204,382) in Q1 2024[83] - Cash used in investing activities was approximately $14,944 in Q1 2025, down from $29,444 in Q1 2024[85] - Cash used in financing activities decreased to $169,073 in Q1 2025 from $392,100 in Q1 2024[86] - The company experienced a 15% increase in commission expenses, correlating with revenue growth[77] Operational Strategy - The 5MinuteInsure.com platform operates in 46 states and allows consumers to compare quotes from up to 30 insurance carriers, utilizing advanced AI and data mining techniques[62] - RELI Exchange has increased its agent roster by over 300% since its inception, providing a B2B InsurTech platform for agency partners[63] - The Company adopted a "OneFirm" strategy to enhance market presence and improve relationships with carriers, leading to better commission contracts[64] Market Challenges - The competitive landscape includes challenges from technology companies entering the insurance intermediary business and direct sales by insurance companies[65] - The company noted potential impacts of inflation on operating expenses, particularly in labor and facility leases[81] Stock and Shareholder Information - The Company effectuated a 1-for-17 reverse stock split on July 1, 2024, resulting in a rounding addition of approximately 110,350 shares valued at par, totaling $9,490[72] Key Financial Metrics - Adjusted EBITDA (AEBITDA) is a key financial performance metric used by the Company to evaluate operational performance across reporting periods[73]

Financial Performance - Commission income revenue increased by $153,782, or 4%, to $4,236,220 in Q1 2025, compared to $4,082,438 in Q1 2024[3] - Commission expense increased by $192,885, or 15%, to $1,469,427 in Q1 2025, compared to $1,276,542 in Q1 2024[7] - Salaries and wages increased by $398,175, or 22%, to $2,229,837 in Q1 2025, compared to $1,831,662 in Q1 2024[7] - Net loss decreased by $3,609,781, or 68%, to $1,736,882 in Q1 2025, compared to $5,346,663 in Q1 2024[7] - Adjusted EBITDA ("AEBITDA") increased by $219,061, or 297%, to an AEBITDA gain of $145,407 in Q1 2025, compared to an AEBITDA loss of ($73,654) in Q1 2024[7] Strategic Initiatives - The company is moving closer to completing the Spetner acquisition, which is expected to enhance insurance capabilities and strengthen financial and market position[2] - The launch of RELI Auto Leasing allows agency partners to provide vehicle leasing access nationwide, enhancing client relationships and opening a new revenue stream[2] - Continued adoption of advanced InsurTech solutions is transforming the agent experience through AI-driven automation and improved underwriting precision[2] - The company aims to build RELI Exchange into the largest agency partner network in the U.S., driving significant shareholder value[9] - Management's disciplined cost controls and efficiencies gained under the OneFirm initiative are reflected in decreasing standard non-equity-based costs[7]

Core Viewpoint - Reliance Global Group, Inc. reported improved financial results for Q1 2025, highlighting organic revenue growth, reduced net loss, and increased AEBITDA, positioning the company for long-term growth and enhanced profitability [2][5]. Financial Performance - Commission income revenue increased by $153,782, or 4%, to $4,236,220 in Q1 2025 from $4,082,438 in Q1 2024, reflecting organic growth in insurance distribution channels [5]. - Commission expense rose by $192,885, or 15%, to $1,469,427 in Q1 2025 compared to $1,276,542 in Q1 2024, due to higher payouts to agents [5]. - Salaries and wages increased by $398,175, or 22%, to $2,229,837 in Q1 2025 from $1,831,662 in Q1 2024, primarily due to $540,015 in non-cash equity awards [5]. - General and administrative expenses increased by $141,388 to $1,516,228 in Q1 2025 from $1,374,890 in Q1 2024, mainly due to $484,970 of non-cash equity pay [5]. - Net loss decreased by $3,609,781, or 68%, to $1,736,882 in Q1 2025 from $5,346,663 in Q1 2024, driven by the elimination of impairment charges [5]. - Adjusted EBITDA (AEBITDA) increased by $219,061, or 297%, to a gain of $145,407 in Q1 2025 compared to a loss of ($73,654) in Q1 2024, indicating a trend toward increased profitability [5][14]. Strategic Initiatives - The company is focused on completing the Spetner acquisition, which is expected to enhance its insurance capabilities and strengthen its market position [2]. - The launch of RELI Auto Leasing allows agency partners to offer vehicle leasing services, enhancing client relationships and creating a new revenue stream [2]. - Continued adoption of advanced InsurTech solutions is transforming the agent experience through AI-driven automation and improved underwriting precision [2].

Company Overview - Reliance Global Group, Inc. is an InsurTech pioneer utilizing artificial intelligence (AI) and cloud-based technologies to enhance efficiencies in the insurance agency and brokerage industry [4] - The company's B2B InsurTech platform, RELI Exchange, offers independent insurance agencies a comprehensive suite of business development tools to compete with large national agencies while minimizing back-office costs [4] - Reliance also operates a B2C platform, 5minuteinsure.com, which uses AI and data mining to provide quick online insurance quotes for auto, home, and life insurance [4] - The company has a portfolio of retail insurance agencies that are leaders in their regions across the United States, offering a diverse range of insurance products [4] Upcoming Events - Reliance Global Group will host a conference call on May 14, 2025, at 4:30 PM Eastern Time to discuss Q1 2025 financial results and provide a business update [1] - The conference call can be accessed via telephone or through a webcast available on the company's investor relations website [2] Replay Information - A replay of the conference call will be available on the investor relations section of the company's website until May 13, 2026 [3] - Telephone replay will be accessible approximately one hour after the call until May 27, 2025 [3]