• Total Revenue (Q4 2024): $33.2 million, a 40% increase year over year.
• Total Revenue (Full Year 2024): $111.9 million, a 69% increase year over year.
• Adjusted Net Income (Q4 2024): $13.4 million, a 126% increase year over year.
• Adjusted Net Income (Full Year 2024): $46.5 million, a 58% increase year over year.
• Adjusted IBEA (Q4 2024): $16.6 million, a 51% increase year over year.
• Adjusted IBEA (Full Year 2024): $61.6 million, a 57% increase year over year.
• Adjusted IBEA Margin (Q4 2024): 50% compared to 47% in the prior year.
• Adjusted IBEA Margin (Full Year 2024): 55% compared to 59% in the prior year.
• GAAP Net Loss (Q4 2024): $18.3 million, primarily due to non-cash stock-based compensation and acquisition-related expenses.
• Capital Deployed (Q4 2024): $96.6 million, a 41% increase year over year.
• Policies Originated (Q4 2024): 214 policies.
• Assets Under Management (Acquisitions): Approximately $2.6 billion added through acquisitions.
• Cash and Cash Equivalents (End of 2024): $128.8 million.
• Outstanding Long-term Debt (End of 2024): $342.4 million.
• Adjusted Return on Equity (Full Year 2024): 17%.
• Adjusted Return on Invested Capital (Full Year 2024): 15%.

• Warning! GuruFocus has detected 5 Warning Signs with ABL.

Release Date: March 27, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Abacus Global Management Inc (NASDAQ:ABL) achieved a 40% year-over-year increase in total revenue for Q4 2024, reaching $33.2 million.
• The company recorded a 126% growth in adjusted net income for Q4 2024, amounting to $13.4 million.
• Abacus successfully completed two strategic acquisitions, adding approximately $2.6 billion in assets under management.
• The company raised $181.7 million in additional equity through oversubscribed offerings, enhancing its liquidity position.
• Abacus initiated a strong 2025 outlook, projecting adjusted net income growth between 51% and 68%.

Negative Points

• The company reported a GAAP net loss attributable to stockholders of $18.3 million for Q4 2024, primarily due to non-cash stock-based compensation and non-recurring acquisition expenses.
• Operating expenses increased significantly to $45.5 million in Q4 2024, compared to $18.9 million in the prior year.
• The adjusted EBITDA margin decreased to 55% for the full year 2024, down from 59% in the prior year.
• Abacus's balance sheet showed outstanding long-term debt of $342.4 million as of December 31, 2024.
• The company faces risks and uncertainties related to forward-looking statements, which could materially affect future results.

Q & A Highlights

Q: Could you provide some color on the key swing factors in your assumptions between the high and low end of your guidance range? Does the high end assume a full draw in deployment of the $50 million remaining on the revolver? A: The guidance range is not dependent on the $50 million additional draw. Key drivers include origination and integration of asset management into the balance sheet. There is significant upside potential as we continue to integrate businesses and raise more capital through our acquisitions and strategies. The additional $50 million would be incremental.

Q: How have the direct channel metrics been tracking since you resumed advertising after the election? A: We did not pause total advertising; we shifted it to non-swing states. The campaign continues to be successful, with positive returns on advertising spend. It has also increased awareness among financial advisors and agents, leading to more inquiries and interest.

Q: How much of the capital raised in the November equity and December debt offerings was deployed in Q4 and Q1 to date? When do you expect to be fully deployed? A: A significant amount was deployed by the end of 2024, with a strong cash position of around $131 million. We are well-positioned for Q1, deploying capital at or better than previous quarters. We do not anticipate needing additional equity raises in 2025.

Q: Can you discuss your strategy of holding policies on the balance sheet? Are there any changes in holding duration or strategy? A: We typically target two turns per year, with an average holding period of 4 to 6 months. The balance sheet amount will hover around $370 to $450 million as we replace sold policies with new ones. This strategy maximizes the return on invested capital.

Q: Are you seeing any change in behavior from individuals settling life insurance policies due to the current economic environment? A: Volatile markets can increase origination interest as individuals seek liquidity. We also see increased interest from investors seeking alternative assets. Our position is strong, with interest from both consumers and investors in this market environment.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.