Revenue Growth - Total revenues for the three months ended March 31, 2025, were $44,139,346, a significant increase of $22,652,162 or 105.8% compared to $21,487,184 for the same period in 2024[149] - Asset management revenue surged to $7,773,077, reflecting an increase of $7,555,142 or 3466.7% compared to $217,935 in the prior year, primarily driven by the Carlisle and FCF acquisitions[151] - Life solutions revenue rose to $36,298,657, an increase of $15,029,408 or 70.7% from $21,269,249, mainly due to unrealized gains from life insurance policies[152] - Asset Management segment revenue reached $7,773,077 for the three months ended March 31, 2025, a significant increase of $7,555,142 or 3466.7% compared to the same period in 2024[168] - Life Solutions segment revenue increased to $36,298,657 for the three months ended March 31, 2025, up by $15,029,408 or 70.7% compared to the same period in 2024[170] Profitability - Gross profit increased by $18,264,652 or 97.3%, reaching $37,030,939 for the three months ended March 31, 2025, compared to $18,766,287 in 2024[155] - Operating income for the period was $21,026,964, a substantial increase from $2,253,129 in the previous year[150] - Net income attributable to common stockholders was $4,639,583 for the three months ended March 31, 2025, compared to a loss of $(1,348,745) in the same period of 2024[150] - Adjusted Net Income for the three months ended March 31, 2025, was $17,252,141, compared to $6,703,951 for the same period in 2024[178] - Net income for the three months ended March 31, 2025, was $5,399,026, compared to a loss of $1,275,471 in the same period of 2024, representing a significant turnaround[182] Expenses - Sales and marketing expenses increased by $686,056 or 35.5%, totaling $2,616,000, primarily due to higher advertising costs to support life policy revenue growth[157] - General and administrative expenses rose by $910,287 or 8.0%, amounting to $12,263,786, driven by payroll expenses related to business acquisitions and legal fees[158] - Depreciation and amortization expenses increased by $3,076,492 or 182.9%, totaling $4,758,546, attributed to the amortization of intangible assets from acquisitions[159] - Interest expense rose to $9,618,330 for the three months ended March 31, 2025, an increase of $5,947,885 or 162.0% compared to the same period in 2024[164] - Income tax expense increased by $1,160,572, or 98.9%, for the three months ended March 31, 2025, compared to the same period in 2024[166] Cash Flow and Liquidity - Cash and cash equivalents totaled $43,761,731 as of March 31, 2025, down from $131,944,282 at the end of 2024, indicating a need for careful liquidity management[195] - For the three months ended March 31, 2025, the company reported a net cash used in operating activities of $(61,590,694), a decrease of $(64,104,982) compared to a net cash provided of $2,514,288 in the same period of 2024[201] - The net cash used in investing activities increased to $(3,739,403) for the three months ended March 31, 2025, compared to $(253,793) in the prior year, reflecting a $(3,485,610) increase primarily due to a $(3,000,000) purchase of other investments[202] - Financing activities resulted in a net cash used of $(22,852,454) for the three months ended March 31, 2025, a decrease of $(60,389,803) from a net cash provided of $37,537,349 in the same period of 2024, mainly due to $(38,415,464) repayment of long-term debt[203] Investments and Assets - The aggregate face value of policies held at fair value reached $1,430,721,703, with a corresponding fair value of $446,207,963 as of March 31, 2025[184] - Total realized gains, net of premiums paid, increased by 59.8% to $13,875,116 compared to $8,683,082 in the prior year[184] - Assets under management (AUM) grew to $2,542,185,454, a significant increase from zero in the same period last year[185] - The number of policies serviced surged by 223.7% to 2,415, with the value of policies serviced increasing by 479.9% to $6,119,634,672[185] Shareholder Information - Pro forma adjusted net income available to common stockholders was $4,639,583 for the three months ended March 31, 2025, compared to $685,285 in 2024[189] - The company has a share repurchase plan approved for $15,000,000, with $2,974,863 remaining available for repurchases as of March 31, 2025[197] Future Outlook - Future capital requirements will depend on revenue growth and expansion activities, with potential plans for acquiring complementary businesses[196] Accounting Policies - The company has not reported any material changes to its critical accounting policies or methodologies since the last Annual Report on Form 10-K[204] - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures[207]
EAST RESOURCES A(ERES) - 2025 Q1 - Quarterly Report