Abacus Life(ABL) - 2025 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 more than doubled year over year to $44.1 million from$21.5 million [7][13] - Adjusted net income increased to $17.3 million, representing a 158$6.7 million in the prior year [15] - Adjusted EBITDA also more than doubled to $24.5 million, with an adjusted EBITDA margin of 55.6$4.6 million, compared to a GAAP net loss of $1.3 million in the prior year [15][16] Business Line Data and Key Metrics Changes - Life Solutions revenue was a key driver, with capital deployed increasing 128$124.9 million in Q1 2025 compared to $54.6 million in the prior year [13][14] - Asset management revenue for Q1 2025 was$7.8 million, marking the first full quarter of fees from acquisitions made in late 2024 [14] - New AUM inflows for asset management offerings were $151 million, with$123 million coming from newly launched private funds [9][10] Market Data and Key Metrics Changes - As of March 31, 2025, the company held cash and cash equivalents of $43.8 million and balance sheet policy assets valued at$448.1 million [9][16] - The company reported annualized adjusted return on equity of 16% and adjusted return on invested capital of 16.7% [16] Company Strategy and Development Direction - The company aims to solidify its position as a leader in alternative asset management and wealth management, focusing on uncorrelated assets [12] - The rebranding to Abacus Global Management reflects its evolution and expanded global market presence [10] - The company is committed to executing its growth strategy and expanding its brand recognition through new advertising campaigns [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating current market volatility and achieving full-year 2025 adjusted net income guidance of $70 million to$78 million, implying growth of 51% to 68% [7][16] - The macro environment remains uncertain, but the company believes it is well-positioned to capitalize on opportunities arising from market dislocations [9][12] Other Important Information - The company has purchased over $10 billion in face value of life insurance policies since February 2004 [10] - The technology solutions segment has seen significant growth, with nearly one million lives currently tracked and an additional 700,000 in trial [42] Q&A Session Summary Question: Has there been an uptick in inquiries from policyholders since Liberation Day? - Management noted a noticeable uptick in interest from policyholders seeking liquidity and from investors looking for uncorrelated assets [21][23] Question: How does the company view the new repurchase authorization? - Management discussed the strategic decision to repurchase stock based on valuation and potential returns compared to acquiring new policies [24][25] Question: Is the company fully deployed today? - Management confirmed that the capital deployment in Q1 was higher than historical levels and expressed confidence in continuing to recycle capital effectively [28][30] Question: What are the latest thoughts on the carrier buyback program? - Management indicated ongoing activity in the buyback program and noted increasing competition for assets from investors [32][33] Question: Can you provide an update on the technology solutions segment? - Management reported significant growth in the number of lives tracked and highlighted the potential for cross-selling asset management services [42][44] Question: What is the mix of policy acquisitions? - Management stated that approximately 40% of policy flow was direct to consumer, 40% from financial advisors, and 20% from brokers, maintaining a consistent split [66]