– Total Revenue Grew 20% Year-over-Year to $21.1 Million –
– Increased Originations Capital Deployment by 43% Year-over-Year to $51 Million –
– GAAP Net Income of $0.9 Million; non-GAAP Adjusted Net Income of $9.2 Million –
– Non-GAAP Adjusted EBITDA Grew 26% Year-over-Year to $10.8 Million –
ORLANDO, Fla., Nov. 13, 2023 (GLOBE NEWSWIRE) — Abacus Life, Inc. (“Abacus” or the “Company”) (NASDAQ: ABL), a leading buyer of life insurance policies and vertically integrated alternative asset manager specializing in specialty insurance products, today reported results for the quarter ended September 30, 2023.
“Our strong third quarter results continue to validate Abacus’ differentiated business model and further contributes to our solid track record of sustained growth,” said Jay Jackson, Chief Executive Officer of Abacus. “We achieved additional milestones following the end of the third quarter, successfully completing our first public bond offering and refinancing prior debt with the proceeds, improving our cost of capital by approximately 275 basis points while extending our maturity wall.”
“We also recently announced the launch of our new wealth division, ABL Wealth, to offer clients custom lifespan-based financial solutions in partnership with Dynasty Financial Partners, one of the country’s leading wealth management platforms for independent wealth management firms. As we close out 2023, we believe our proven business model positions us to continue executing on our multiple strategic growth initiatives, generating sustained profitability and ultimately creating long-term value for our shareholders,” concluded Jackson.
Third Quarter 2023 Highlights (on a Proforma Basis)
- Total revenue for the third quarter of 2023 grew 20% to $21.1 million, compared to $17.5 million in the prior-year period.
- Originations capital deployment for the third quarter of 2023 increased 43% to $51 million, compared to $34 million in the prior-year period; number of policy originations for the third quarter of 2023 grew 61% to 181, compared to 112 in the prior-year period.
- GAAP net income attributable to shareholders for the third quarter of 2023 was $0.9 million, compared to $11.2 million in the prior-year period.
- Adjusted net income was $9.2 million, compared to $10.2 million in the prior-year period.
- Adjusted EBITDA for the third quarter of 2023 grew 26% to $10.8 million, compared to $8.5 million in the prior-year period, which was primarily attributable to strong revenue growth, partially offset by higher operating expenses. Adjusted EBITDA margin (a non-GAAP measure) for the third quarter of 2023 was 51.1%, compared to 48.7% in the prior-year period.
- Annualized return on invested capital (ROIC) (a non-GAAP measure defined below) for the third quarter of 2023 was 2.8%; adjusted ROIC of 29%.
- Annualized Return on equity (ROE) (a non-GAAP measure defined below) for the third quarter of 2023 was 2.2%; adjusted ROE of 22%.
- Total operating expenses for the third quarter of 2023 were $12.9 million, compared to $1.4 million in the prior-year period. Higher operating expenses were primarily driven by non-cash expense of $4.6 million related to employee stock compensation and public company expenses incurred in the third quarter of 2023 that were not recorded in the prior-year period.
Third Quarter 2023 Results (on a Proforma Basis)
- Active management revenue for the third quarter of 2023 increased 70% to $18.9 million, compared to $11.1 million in the prior-year period, primarily due to increased policy acquisition and realized trade revenue.
- Total revenue from portfolio servicing segment for the third quarter of 2023 was $0.2 million, compared to $0.4 million in the prior-year period.
- Total Originations revenue for the third quarter of 2023 was $2.0 million, compared to $6.0 million in the prior-year period, primarily due to fewer policies sold to third parties.
- GAAP net income attributable to shareholders for the third quarter of 2023 of $0.9 million, compared to GAAP net income attributable to shareholders of $11.2 million in the prior-year period, primarily driven by a non-cash expense of $4.6 million related to employee stock compensation and public company expenses incurred in the third quarter of 2023 that were not recorded in the prior-year period.
Liquidity and Capital
As of September 30, 2023, the Company had cash and cash equivalents of $36.6 million, balance sheet policy assets of $87.7 million and outstanding long-term debt of $118.8 million.
Webcast and Conference Call
A webcast and conference call to discuss the Company’s results will be held today beginning at 9:00 a.m. (Eastern Time). A live webcast of the conference call will be available on Abacus Life’s investor relations website at ir.abacuslife.com. The dial-in number for the conference call is (877) 407-9716 (toll-free) or (201) 493-6779 (international). Please dial the number 10 minutes prior to the scheduled start time.
A webcast replay of the call will be available at ir.abacuslife.com for one year following the call.
Non-GAAP Financial Information
Adjusted Net Income, a non-GAAP measure, is defined as net income (loss) attributable to Abacus adjusted for non-controlling interest income, amortization, change in fair value of warrants and non-cash stock-based compensation and the related tax effect of those adjustments. Management believes that Adjusted Net Income is an appropriate measure of operating performance because it eliminates the impact of expenses that do not relate to business performance. A reconciliation of Adjusted Net Income to Net income attributable to Abacus, the most directly comparable GAAP measure, appears below.
Adjusted EBITDA, a non-GAAP measure, is defined as net income (loss) attributable to Abacus adjusted for depreciation expense, amortization, interest expense, income tax and other non-cash and non-recurring items that in our judgement significantly impact the period-over-period assessment of performance and operating results that do not directly relate to business performance within Abacus’ control.]. A reconciliation of Adjusted EBITDA to Net income attributable to Abacus Life, the most directly comparable GAAP measure, appears below.
Adjusted EBITDA margin, a non-GAAP measure, is defined as Adjusted EBITDA divided by Total revenues. A reconciliation of Adjusted EBITDA margin to Net income margin, the most directly comparable GAAP measure, appears below.
Annualized return on invested capital (ROIC), a non-GAAP measure, is defined as Adjusted net income for the quarter divided by the result of Total Assets less Intangible assets, net, Goodwill and Current Liabilities multiplied by four. ROIC is not a measure of financial performance under GAAP. We believe ROIC should be considered in addition to, not as a substitute for, operating income or loss, net income or loss, cash flows provided by or used in operating, investing and financing activities or other income statement or cash flow statement line items reported in accordance with GAAP.
Annualized return on equity (ROE), a non-GAAP measure, is defined as [Adjusted net income divided by total shareholder equity multiplied by four. ROE is not a measure of financial performance under GAAP. We believe ROE should be considered in addition to, not as a substitute for, operating income or loss, net income or loss, cash flows provided by or used in operating, investing and financing activities or other income statement or cash flow statement line items reported in accordance with GAAP. The below table presents our calculation of ROE.
Forward-Looking Statements
All statements in this press release (and oral statements made regarding the subjects of this press release) other than historical facts are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements rely on a number of assumptions concerning future events and are subject to a number of uncertainties and factors that could cause actual results to differ materially from such statements, many of which are outside the control of Abacus. Forward-looking information includes but is not limited to statements regarding: Abacus’s financial and operational outlook; Abacus’s operational and financial strategies, including planned growth initiatives and the benefits thereof, Abacus’s ability to successfully effect those strategies, and the expected results therefrom. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “expect,” ”intend,” “anticipate,” “goals,” “prospects,” “will,” “would,” “will continue,” “will likely result,” and similar expressions (including the negative versions of such words or expressions).
While Abacus believes that the assumptions concerning future events are reasonable, it cautions that there are inherent difficulties in predicting certain important factors that could impact the future performance or results of its business. The factors that could cause results to differ materially from those indicated by such forward-looking statements include, but are not limited to: the fact that Abacus’s loss reserves are bases on estimates and may be inadequate to cover its actual losses; the failure to properly price Abacus’s insurance policies; the geographic concentration of Abacus’s business; the cyclical nature of Abacus’s industry; the impact of regulation on Abacus’s business; the effects of competition on Abacus’s business; the failure of Abacus’s relationships with independent agencies; the failure to meet Abacus’s investment objectives; the inability to raise capital on favorable terms or at all; the effects of acts of terrorism; and the effectiveness of Abacus’s control environment, including the identification of control deficiencies.
These forward-looking statements are also affected by the risk factors, forward-looking statements and challenges and uncertainties set forth in documents filed by Abacus with the U.S. Securities and Exchange Commission from time to time, including the Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and subsequent periodic reports. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Abacus cautions you not to place undue reliance on the forward-looking statements contained in this press release. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Abacus assumes no obligation and, except as required by law, does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise. Abacus does not give any assurance that it will achieve its expectations.
About Abacus
Abacus is a leading vertically integrated alternative asset manager and market maker, specializing in longevity and actuarial technology. The company is democratizing the life insurance space through three groundbreaking new channels: ABL Tech, ABL Wealth, and ABL Longevity Funds. Since 2004, Abacus has purchased life insurance policies from consumers seeking liquidity and has actively managed those policies over time (via trading, holding, and/or servicing). With over $4.6BN in face value of policies purchased, we have helped thousands of clients maximize the value of life insurance. Abacus Life is the only public life settlement company, trading on the Nasdaq Exchange under the ticker symbol ABL.
Over the past 19 years, the company has built an institutionalized origination and portfolio management process that is supported by a 95+ person team, long-term relationships with 78 institutional partners and 30,000 financial advisors, and the ability to operate in 49 states. The Company complies with HIPAA and privacy laws to maintain and protect confidentiality of financial, health, and medical information. Abacus is also proud to be a BBB Accredited Business with an A+ rating.
www.Abacuslife.com
Contact:
Abacus Life Investor Relations
investors@abacuslife.com
Abacus Life Public Relations
press@abacuslife.com
ABACUS LIFE, INC. Condensed Consolidated Balance Sheets
| September 30, | December 31, | |||||
| 2023 | 2022 | |||||
| (unaudited) | ||||||
| ASSETS | ||||||
| CURRENT ASSETS: | ||||||
| Cash and cash equivalents | $ | 36,649,190 | $ | 30,052,823 | ||
| Accounts receivable | 960,720 | 10,448 | ||||
| Accounts receivable, related party | 174,875 | 198,364 | ||||
| Due from affiliates | 772,545 | 2,904,646 | ||||
| Prepaid expenses and other current assets | 961,427 | 116,646 | ||||
| Total current assets | 39,518,757 | 33,282,927 | ||||
| Property and equipment, net | 261,882 | 18,617 | ||||
| Intangible assets, net | 31,217,917 | — | ||||
| Goodwill | 140,287,000 | — | ||||
| Operating right-of-use assets | 171,295 | 77,011 | ||||
| Life settlement policies, at cost | 4,116,499 | 8,716,111 | ||||
| Life settlement policies, at fair value | 83,585,374 | 13,809,352 | ||||
| Available-for-sale securities, at fair value | 1,000,000 | 1,000,000 | ||||
| Other investments, at cost | 1,650,000 | 1,300,000 | ||||
| Other assets | 998,469 | — | ||||
| Equity securities, at fair value | 1,494,744 | 890,829 | ||||
| TOTAL ASSETS | $ | 304,301,937 | $ | 59,094,847 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||
| CURRENT LIABILITIES: | ||||||
| Accrued expenses | $ | 636,788 | $ | — | ||
| Accounts payable | 2,000 | 40,014 | ||||
| Operating lease liability, current | 173,799 | 48,127 | ||||
| Due to affiliates | 5,236 | 263,785 | ||||
| Due to owners | 1,159,712 | — | ||||
| Contract liabilities – deposits on pending settlements | 348,836 | — | ||||
| Accrued transaction costs | — | 908,256 | ||||
| Other current liabilities | 3,050,731 | 42,227 | ||||
| Income taxes payable | 80,573 | — | ||||
| Total current liabilities | 5,457,675 | 1,302,409 | ||||
| Long-term debt- Related party | 36,535,778 | — | ||||
| Long-term debt | 82,278,050 | 28,249,653 | ||||
| Operating lease liability, noncurrent | — | 29,268 | ||||
| Deferred tax liability | 10,558,687 | 1,363,820 | ||||
| Warrant liability | 3,382,000 | — | ||||
| TOTAL LIABILITIES | 138,212,190 | 30,945,150 | ||||
| COMMITMENTS AND CONTINGENCIES (11) | ||||||
| SHAREHOLDERS’ EQUITY (DEFICIT) | ||||||
| Class A common stock, 0.0001 par value; 200,000,000 authorized shares; 63,349,823 and 50,369,350 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively | 6,335 | 5,037 | ||||
| Additional paid-in capital | 194,197,780 | 704,963 | ||||
| Retained earnings | (28,503,752 | ) | 25,487,323 | |||
| Accumulated other comprehensive income | 100,175 | 1,052,836 | ||||
| Non-controlling interest | 289,248 | 899,538 | ||||
| Total shareholders’ equity (deficit) | 166,089,747 | 28,149,697 | ||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY (DEFICIT) | $ | 304,301,937 | $ | 59,094,847 | ||
ABACUS LIFE, INC. Proforma Condensed Consolidated Statement of Operations
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
| REVENUES: | |||||||||||||||||||||
| Portfolio servicing revenue | |||||||||||||||||||||
| Related party service revenue | $ | 168,899 | $ | 132,220 | $ | 711,975 | $ | 752,379 | |||||||||||||
| Portfolio servicing | 55,670 | 250,025 | 102,651 | 620,194 | |||||||||||||||||
| Total Portfolio servicing revenue | 224,569 | 382,245 | 814,626 | 1,372,573 | |||||||||||||||||
| Active management revenue | |||||||||||||||||||||
| Investment Income from life insurance policies held using investment method | 1,817,764 | 10,629,978 | 18,473,597 | 24,610,444 | |||||||||||||||||
| Change in fair value of life insurance policies (policies held using fair value method) | 17,108,380 | 1,450,525 | 28,242,105 | 5,226,231 | |||||||||||||||||
| Total Active management revenue | 18,926,144 | 12,080,503 | 46,715,702 | 29,836,674 | |||||||||||||||||
| Originations revenue | |||||||||||||||||||||
| Related Party origination revenue | 254,517 | 3,309,628 | 3,391,814 | 12,669,023 | |||||||||||||||||
| Originations | 1,715,700 | 1,766,853 | 4,968,438 | 4,951,921 | |||||||||||||||||
| Total Origination revenue | 1,970,217 | 5,076,481 | 8,360,252 | 17,620,944 | |||||||||||||||||
| Total Revenues | 21,120,930 | 17,539,229 | 55,890,580 | 48,830,191 | |||||||||||||||||
| COST OF REVENUES (excluding depreciation and amortization stated below) | |||||||||||||||||||||
| Related party cost of revenue | 7,981 | 2,930,990 | 6,566,335 | 8,453,302 | |||||||||||||||||
| Cost of revenue | 3,356,976 | 2,687,983 | 7,554,875 | 8,039,370 | |||||||||||||||||
| Total Cost of revenue | 3,364,957 | 5,618,973 | 14,121,210 | 16,492,673 | |||||||||||||||||
| Gross Profit | 17,755,973 | 11,920,256 | 41,769,370 | 32,337,519 | |||||||||||||||||
| OPERATING EXPENSES: | |||||||||||||||||||||
| Sales and marketing | 1,704,154 | 14,905 | 3,116,999 | 1,664,403 | |||||||||||||||||
| General, administrative and other | 9,838,951 | 2,344,237 | 15,961,962 | 6,938,942 | |||||||||||||||||
| (Gain) loss on change in fair value of debt | (2,088,797 | ) | (1,235,032 | ) | 309,865 | (859,519 | ) | ||||||||||||||
| Unrealized loss (gain) on investments | 306,800 | 246,846 | (491,356 | ) | 1,301,821 | ||||||||||||||||
| Depreciation and amortization expense | 1,694,853 | 4,219 | 1,702,591 | 12,360 | |||||||||||||||||
| Total Operating expenses | 11,455,961 | 1,375,175 | 20,600,061 | 9,058,007 | |||||||||||||||||
| Operating Income | $ | 6,300,012 | $ | 10,545,081 | $ | 21,169,309 | $ | 23,279,512 | |||||||||||||
| OTHER INCOME (EXPENSE) | |||||||||||||||||||||
| Change in fair value of warrant liability | (943,400 | ) | – | (943,400 | ) | – | |||||||||||||||
| Interest (expense) | (2,679,237 | ) | (2,449 | ) | (3,632,420 | ) | (1,449 | ) | |||||||||||||
| Interest income | 63,826 | – | 73,200 | – | |||||||||||||||||
| Other income (expense) | 20,086 | 42,288 | (1,565 | ) | (199,959 | ) | |||||||||||||||
| Total other income (expense) | (3,538,725 | ) | 39,839 | (4,504,185 | ) | (201,408 | ) | ||||||||||||||
| Net income before provision for income taxes | 2,761,287 | 10,584,920 | 16,665,124 | 23,078,104 | |||||||||||||||||
| Income tax expense | 1,710,315 | (948,600 | ) | 2,240,708 | (650,794 | ) | |||||||||||||||
| NET INCOME | 1,050,972 | 11,533,520 | 14,424,416 | 23,728,898 | |||||||||||||||||
| LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST | 147,611 | 363,452 | (339,692 | ) | 770,093 | ||||||||||||||||
| NET INCOME ATTRIBUTABLE TO SHAREHOLDERS | $ | 903,361 | $ | 11,170,068 | $ | 14,764,108 | $ | 22,958,805 | |||||||||||||
| EARNINGS PER SHARE: | |||||||||||||||||||||
| Earnings per share – basic and diluted | $ | 0.01 | $ | 0.22 | $ | 0.27 | $ | 0.46 | |||||||||||||
| Weighted-average units outstanding—basic and diluted | 63,349,823 | 50,369,350 | 54,632,826 | 50,369,350 | |||||||||||||||||
| NET INCOME | 1,050,972 | 11,533,520 | 14,424,416 | 23,728,898 | |||||||||||||||||
| Other comprehensive income, net of tax: | |||||||||||||||||||||
| Change in fair value of debt | (1,016,034 | ) | 2,017,559 | (1,599,104 | ) | 1,494,476 | |||||||||||||||
| Comprehensive income before non-controlling interests | 34,938 | 13,551,079 | 12,825,312 | 25,223,374 | |||||||||||||||||
| Comprehensive income (loss) attributable to non-controlling interests | (91,292 | ) | 1,011,909 | (709,641 | ) | 1,136,586 | |||||||||||||||
| Comprehensive income attributable to Abacus Life Inc. | $ | 126,230 | $ | 12,539,170 | $ | 13,534,953 | $ | 24,086,788 | |||||||||||||
| * 2022 solely includes historical results for Abacus Settlements, LLC and Longevity Market Assets, LLC | |||||||||||||||||||||
ABACUS LIFE, INC. Proforma Adjusted Net Income and Adjusted EPS
| Proforma adjusted Net Income and Adjusted EPS | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||
| Net income attributable to Abacus Life, Inc. | $ | 903,361 | $ | 9,992,003 | $ | 15,739,009 | $ | 21,507,702 | ||||||||||||
| Net income for Abacus Settlements, LLC | — | (122,998 | ) | (974,901 | ) | 149,790 | ||||||||||||||
| Proforma net income attributable to Abacus Life, Inc. | 903,361 | 9,869,005 | [1] | 14,764,108 | [2] | 21,657,492 | [3] | |||||||||||||
| Net income attributable to non-controlling interests | 147,611 | 363,452 | (339,692 | ) | 770,093 | |||||||||||||||
| Amortization expense | 1,682,083 | — | 1,682,083 | — | ||||||||||||||||
| Stock compensation expense | 4,583,632 | — | 4,583,632 | — | ||||||||||||||||
| Change in fair value of warrant liability | 943,400 | — | 943,400 | — | ||||||||||||||||
| Tax impact of items listed above | 908,271 | 908,271 | ||||||||||||||||||
| Proforma adjusted Net Income | $ | 9,168,359 | $ | 10,232,457 | $ | 22,541,803 | $ | 22,427,585 | ||||||||||||
| Weighted-average shares of Class A common stock outstanding | 63,349,823 | 50,369,350 | 54,632,826 | 50,369,350 | ||||||||||||||||
| Proforma Adjusted EPS | $ | 0.14 | $ | 0.20 | $ | 0.41 | $ | 0.45 | ||||||||||||
| [1] | Includes historical net income attributable to Abacus Life Inc. for the three months ended September 30, 2022 of $9,992,003 and a net loss of ($122,998) for Abacus Settlements, LLC. | |||||||||||||||||||
| [2] | Includes year-to-date net income attributable to Abacus Life Inc. as of September 30, 2023 of $15,739,009 plus net loss for the six month period ended on June 30, 2023 for Abacus Settlements, LLC of ($974,901). | |||||||||||||||||||
| [3] | Includes historical net income attributable to Abacus Life Inc. for the nine months ended September 30, 2022 of $21,507,702 and $149,790 for Abacus Settlements, LLC. | |||||||||||||||||||
ABACUS LIFE, INC. Proforma Adjusted EBITDA
| Proforma adjusted EBITDA | Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | |||||||||||||||||
| Net Income for Abacus Life Inc. | $ | 10,355,455 | $ | 15,399,317 | $ | 22,277,795 | ||||||||||||||
| Net Income for Abacus Settlements, LLC | (122,998 | ) | (974,901 | ) | 149,790 | |||||||||||||||
| Proforma Net Income | 1,050,972 | 10,232,457 | [1] | 14,424,416 | [2] | 22,427,585 | [3] | |||||||||||||
| Depreciation | 12,770 | 4,219 | 20,508 | 12,360 | ||||||||||||||||
| Amortization | 1,682,083 | — | 1,682,083 | — | ||||||||||||||||
| Interest expense | 2,679,237 | 2,449 | 3,632,420 | 1,449 | ||||||||||||||||
| Interest income | (63,826 | ) | — | (73,200 | ) | — | ||||||||||||||
| Income tax expense | 1,710,315 | (948,600 | ) | 2,240,708 | (650,794 | ) | ||||||||||||||
| Stock compensation | 4,583,632 | — | 4,583,632 | — | ||||||||||||||||
| Other (Income) / Expenses | (20,086 | ) | (42,288 | ) | 1,565 | 199,959 | ||||||||||||||
| Change in fair value of warrant liability | 943,400 | — | 943,400 | — | ||||||||||||||||
| Expense support agreement | — | 283,047 | — | 283,047 | ||||||||||||||||
| Change in fair value of debt | (2,088,797 | ) | (1,235,032 | ) | 309,865 | (859,519 | ) | |||||||||||||
| Unrealized loss / (gain) on investments | 306,800 | 246,846 | (491,356 | ) | 1,301,821 | |||||||||||||||
| Proforma Adjusted EBITDA | $ | 10,796,500 | $ | 8,543,099 | $ | 27,274,041 | $ | 22,715,908 | ||||||||||||
| Revenue | $ | 21,120,930 | $ | 17,539,229 | $ | 55,890,580 | $ | 48,830,191 | ||||||||||||
| Proforma Adjusted EBITDA Margin | 51.12 | % | 48.71 | % | 48.80 | % | 46.52 | % | ||||||||||||
| Proforma Net Income Margin | 4.98 | % | 58.34 | % | 25.81 | % | 45.93 | % | ||||||||||||
| [1] | Includes historical net income for the three months ended September 30, 2022 of $10,355,455 for Abacus Life Inc. and a loss of ($122,998) for Abacus Settlements, LLC. | |||||||||||||||||||
| [2] | Includes year-to-date net income as of September 30, 2023 of $15,399,317 plus net loss for the six month period ended on June 30, 2023 for Abacus Settlements, LLC of ($974,901). | |||||||||||||||||||
| [3] | Includes historical net income for the nine months ended September 30, 2022 of $22,277,795 for Abacus Life Inc. and $149,790 for Abacus Settlements, LLC. | |||||||||||||||||||
ABACUS LIFE, INC. Proforma Segment Revenue
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||
| Proforma Segment revenue | 2023 |
2022 |
2023 |
2022 |
||||||||||||||||
| Portfolio Servicing | $ | 224,569 | $ | 382,245 | $ | 814,626 | $ | 1,372,573 | ||||||||||||
| Active Management | 18,926,144 | 12,080,008 | [3] | 46,715,702 | [3] | 29,836,674 | [3] | |||||||||||||
| Originations | 10,214,489 | 6,031,481 | 23,399,165 | [1] | 19,046,144 | |||||||||||||||
| Total Revenue (including intersegment) | 29,365,202 | 18,493,734 | 70,929,493 | 50,255,391 | ||||||||||||||||
| Intersegment elimination | (8,244,272 | ) | (955,000 | ) | [2] | (15,038,913 | ) | (1,425,200 | ) | [2] | ||||||||||
| Total Revenue | $ | 21,120,930 | $ | 17,538,734 | $ | 55,890,580 | $ | 48,830,191 | ||||||||||||
| [1] | Includes historical Abacus Settlements, LLC revenue for the period ended June 30, 2023 plus the three months of revenue for the period ended September 30, 2023. | |||||||||||||||||||
| [2] | Represents amount paid from Longevity Market Assets, LLC to Abacus Settlements, LLC for origination services, as disclosed in the related party footnote within the Abacus Settlements, LLC financial statements. | |||||||||||||||||||
| [3] | Includes historical Active Management revenue plus the intersegment activity related to the origination services that Abacus Settlements, LLC is performing for Longevity Market Assets. | |||||||||||||||||||
| As the origination intersegment revenue is eliminated, this would result in an incremental change in fair value of the life settlement policies that were originated by Abacus Settlements, LLC, as it would reduce their cost basis. | ||||||||||||||||||||
ABACUS LIFE, INC. Return on Invested Capital (ROIC)
| For the Period Ended | |||||
| September 30, 2023 | |||||
| Total Assets | $ | 304,301,937 | |||
| Less: | |||||
| Intangible assets, net | (31,217,917 | ) | |||
| Goodwill | (140,287,000 | ) | |||
| Current Liabilities | (5,457,675 | ) | |||
| Total Invested Capital | $ | 127,339,345 | |||
| Net Income Attributable to shareholders | $ | 903,361 | |||
| Annualized ROIC | 2.8 | % | |||
| Proforma Adjusted Net income | $ | 9,168,359 | |||
| Adjusted Annualized ROIC | 29 | % | |||
ABACUS LIFE, INC. Return on Equity (ROE)
| For the Period Ended | |||||
| September 30, 2023 | |||||
| Total Shareholder Equity | $ | 166,089,747 | |||
| Net Income Attributable to shareholders | $ | 903,361 | |||
| Annualized ROE | 2.2 | % | |||
| Proforma Adjusted Net income | $ | 9,168,359 | |||
| Adjusted Annualized ROE | 22 | % | |||
