Abacus Life Reports Second Quarter 2023 Results

- Revenue Grew 30% Year-over-Year to $18.3 Million -

- Increased Originations Capital Deployment by 88% Year-over-Year to $59.7 Million -

- Net Income Increased 40% Year-over-Year to $6.4 Million -

- Adjusted EBITDA Grew 33% Year-over-Year to $8.8 Million -

ORLANDO, Fla., Aug. 14, 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 second quarter ended June 30, 2023.

“Our strong second quarter results continue to validate Abacus' differentiated business model and further contribute to our long track record of sustainable and profitable growth,” said Jay Jackson, Chief Executive Officer of Abacus Life. “In addition to our continued progress, we were very pleased to successfully complete our public listing post-quarter end, a milestone for our long-term growth ambitions. Our proven business model, expert team, and our wealth of data and innovative technology positions us well to execute on our strategic initiatives, take advantage of the many exciting opportunities that lie ahead, and ultimately create long-term value for our shareholders.”

Second Quarter 2023 Highlights

  • Total revenue grew 30% to $18.3 million, compared to $14.1 million in the prior-year period
  • Originations capital deployment increased 88% to $59.7 million, compared to $31.9 million in the prior-year period; number of policy originations grew 4% to 141, compared to 135 in the prior-year period
  • Total operating expenses (excluding unrealized gains and losses and change in fair value) were $4.3 million, compared to $4.6 million in the prior-year period
  • Net income increased 40% to $6.4 million, compared to $4.6 million in the prior-year period
  • Adjusted EBITDA grew 33% to $8.8 million, compared to $6.6 million in the prior-year period
  • Adjusted EBITDA margin of 48.4%, compared to 47.0% in the prior-year period
  • Annualized Return on invested capital (ROIC) for the quarter ended June 30, 2023 of 28.5%
  • Annualized Return on equity (ROE) for the quarter ended June 30, 2023 of 16.0%

Second Quarter 2023 Results

  • Active management revenue increased 38% to $11.0 million, compared to $8.0 million in the prior-year period. The increase was primarily attributable to maturities of policies accounted for under the investment method.
  • Total revenue from portfolio servicing segment was $0.4 million, roughly comparable to the prior-year period.
  • Originations revenue at Abacus Settlements nearly quadrupled to $2.7 million, compared to $0.7 million in the prior-year period. The increase was primarily attributable to higher pricing on the sale of broker policies which led to higher commission fees.
  • Related party revenue at Abacus Settlements was $4.1 million, compared to $4.9 million in the prior-year period. The decrease was mainly due to a decrease in Nova Origination sales and transaction fee reimbursements, partially offset by increased LMA Originations services.
  • Net income increased 40% to $6.4 million, compared to $4.6 million in the prior-year period, driven by strong top-line performance and managing costs efficiently.
  • Adjusted EBITDA for the quarter grew 33% to $8.8 million, compared to $6.6 million in the prior-year period. The increase was primarily attributable to strong revenue growth, partially offset by higher operating expenses. Adjusted EBITDA margin remained strong at 48.4% for the quarter, compared to 47.0% in the prior-year period.

Liquidity and Capital

As of June 30, 2023, the Company had cash and cash equivalents of $20.6 million, balance sheet policy assets of $66.5 million and outstanding long-term debt at fair value of $66.2 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 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 for one year following the call.

Safe Harbor Statement

Statements made in this press release that are not historical facts, including ‎statements accompanied by words such as "will," "believe," "estimate," "expect," ‎‎"intend," "anticipate," "goals," "prospects," or similar words, are forward-looking ‎statements within the meaning of the Private Securities Litigation Reform Act of ‎‎1995 regarding the Company's plans and performance. These statements are ‎based on management's estimates, assumptions and projections as of the date of ‎this release and are not guarantees of future performance. Actual results may ‎differ materially from the results expressed or implied in these statements as the ‎result of risks, uncertainties and other factors including, but not limited to: the ‎fact that our loss reserves are bases on estimates and may be inadequate to cover ‎our actual losses; the failure to properly price our insurance policies; the ‎geographic concentration of our business; the cyclical nature of our industry; the ‎impact of regulation on our business; the effects of competition; failing to sustain ‎our relationships with independent agencies; the failure to meet our investment ‎objectives; the inability to acquire additional capital on favorable terms; the ‎effects of acts of terrorism and the factors set forth in the Company's filings with ‎the Securities and Exchange Commission (the "SEC"), including the Annual ‎Report on Form 10-K and Quarterly Report on Form 10-Q and subsequent ‎periodic reports. The Company cautions you not to place undue reliance on the ‎forward-looking statements contained in this release. Any forward –looking statements speak only as of their dates. The Company does not ‎undertake any obligation to publicly update or revise any forward-looking ‎statements to reflect future events, information or circumstances that arise after ‎the date of this release.‎

About Abacus

Abacus is a leading vertically integrated alternative asset manager specializing in life insurance products. Since 2004, the Company 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 $2.9 billion in face value of policies purchased, Abacus has helped thousands of clients maximize the value of their life insurance.

Over the past 19 years, the Company has built an institutionalized origination and portfolio management process that is supported by an 84-person team, long-term relationships with 78 institutional partners and 30,000 financial advisors, and the ability to operate in 49 states. The Company has serviced approximately $950 million in policies and has managed assets for large asset managers and third-party investment funds.

Abacus’ leadership team averages 20+ years of experience and consists of innovators since the life settlements industry’s inception in the mid-90s.

The Company is a proud member of the Life Insurance Settlements Association (LISA) and 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.

Abacus Life Investor Relations

Abacus Life Public Relations

Condensed Consolidated Balance Sheets
 June 30,

   December 31,
Cash and cash equivalents$20,611,122  $30,052,823 
Accounts receivable 192,595   10,448 
Related party receivable 78,310   198,364 
Due from affiliates 10,473,748   2,904,646 
Other receivables 21,252   - 
Prepaid expenses and other current assets 829,595   116,646 
Total current assets 32,206,622   33,282,927 
Property and equipment, net 177,931   18,617 
Intangible assets, net 32,900,000   - 
Goodwill 140,287,000   - 
Operating right-of-use assets 240,816   77,011 
Life settlement policies, at cost 9,889,610   8,716,111 
Life settlement policies, at fair value 56,685,617   13,809,352 
Available for sale securities, at fair value 1,000,000   1,000,000 
Other investments 1,600,000   1,300,000 
Due from members and affiliates 75,582   - 
State security deposit 206,873   - 
Certificate of deposit 262,500   - 
Other assets, at fair value 1,801,886   890,829 
TOTAL ASSETS$277,334,437  $59,094,847 
Accrued expenses$524,400  $- 
Accounts payable 401,500   40,014 
Operating lease liabilities - current portion 227,561   48,127 
Due to members and affiliates 10,415,154   263,785 
Due to owners 717,429   - 
Contract liabilities - deposits on pending settlements 981,217   - 
Accrued transaction costs 182,571   908,256 
Other current liabilities 258,759   42,227 
Income taxes payable 185,831   - 
Total current liabilities 13,894,422   1,302,409 
SPV purchase and sale note 25,000,000   - 
Long-term debt, at fair value 66,165,396   28,249,653 
Operating lease liabilities - noncurrent portion 16,864   29,268 
Deferred tax liability 9,320,240   1,363,820 
Warrant liability 2,438,600   - 
TOTAL LIABILITIES 116,835,522   30,945,150 
Class A common stock, $0.0001 par value; 200,000,000 authorized shares;
62,961,688 shares issued and outstanding
 6,296   - 
LMA members’ capital -   50,000 
Additional paid-in capital 188,641,886   660,000 
Retained earnings/(accumulated deficit) (29,382,362)  25,487,323 
Accumulated other comprehensive income 877,306   1,052,836 
Non-controlling interest 355,789   899,538 
Total shareholders' equity (deficit) 160,498,915   28,149,697 
The accompanying notes are an integral part of these interim condensed consolidated financial statements.

Condensed Consolidated Statement of Operations
 Three Months Ended June 30,
  2023   2022 
Portfolio servicing revenue       
Related party servicing revenue 329,629  $419,253 
Portfolio Servicing revenue 24,737   169 
Total portfolio servicing revenue 354,366   419,422 
Active management revenue       
Investment Income from life insurance policies held using investment method 8,263,499   5,965,466 
Change in fair value of life insurance policies (policies held using fair value method) 2,760,900   2,014,013 
Total active management revenue 11,024,399   7,979,479 
Total revenues 11,378,765   8,398,901 
COST OF REVENUES (excluding depreciation stated below)       
Cost of revenue 973,400   666,119 
Total cost of revenue 973,400   666,119 
Gross Profit 10,405,365   7,732,782 
Sales and marketing 683,841   1,019,498 
General and administrative expenses 577,539   5,499 
Unrealized gain on life settlement policies -   - 
Loss on change in fair value of debt 1,445,229   333,879 
Unrealized loss (gain) on investments (672,936)  1,039,022 
Depreciation 1,098   1,098 
Total operating expenses 2,034,771   2,398,996 
Operating Income$8,370,594  $5,333,786 
Interest (expense) (584,075)  - 
Interest income -   - 
Other income (expense) 121,601   (127,455)
Total other income (expense) (462,474)  (127,455)
Net income before provision for income taxes 7,908,120   5,206,331 
Provision for income taxes (1,184,571)  (120,132)
NET INCOME 6,723,549   5,086,199 

Condensed Consolidated Statement of Operations
 Three Months Ended June 30
  2023   2022 
Origination revenue$2,745,339  $743,388 
Related party revenue 4,139,351   4,948,528 
Total revenue 6,884,690   5,691,916 
Cost of revenue 2,407,021   956,625 
Related party cost of revenue 2,490,959   2,615,307 
Total cost of revenue 4,897,980   3,571,932 
Gross Profit 1,986,710   2,119,984 
General and administrative expenses 2,297,577   2,208,051 
Depreciation 2,561   3,048 
Total operating expenses 2,300,138   2,211,099 
Income (Loss) from operations (313,428)  (91,115)
Interest income 1,193   599 
Interest (expense) (5,863)  - 
Other income -   273 
Total other income (expense) (4,670)  872 
Income (Loss) before provision for income taxes (318,098)  (90,243)
Provision for income taxes -   - 
Basic$400   400 
Diluted$400   400 
Basic earnings per unit$(795.25) $(225.61)
Diluted earnings per unit$(795.25) $(225.61)
See accompanying notes to interim condensed consolidated financial statement   

Condensed Consolidated Statement of Operations
 Q2 2023 Q2 2022 Increase % Increase 
Origination Revenue6,884,690 5,691,916 1,192,774 21%
Portfolio & Servicing Revenue354,366 419,422 (65,056)(16%)
Active Management Revenue11,024,399 7,979,479 3,044,920 38%
Total Revenue18,263,455 14,090,817 4,172,638 30%
Cost of Revenue     
Origination Cost of Revenue4,897,980 3,571,932 1,326,048 37%
Portfolio & Servicing Cost of Revenue973,400 666,119 307,281 46%
Total Cost of Revenue5,871,380 4,238,051 1,633,329 39%
Gross Profit12,392,075 9,852,766 2,539,309 26%
Operating Expenses (Abacus & LMA)4,334,909 4,610,095 (275,186)(6%)
Other (Income)/Expense467,144 126,583 340,561 269%
Income Tax Provision / (Benefit)1,184,571 120,132 1,064,439 886%
Non-Controlling Interest Income / (Loss)(26,596)406,641 (433,237)(107%)
Net Income Attributable to Shareholders6,432,047 4,589,315 1,842,732 40%
EBITDA8,833,118 6,619,991 2,213,127 33%
Capital Deployed through Abacus59,764,389 31,809,025 27,955,364 88%
3rd Party Capital Deployed through LMA20,638,467 46,274,631 (25,636,164)(55%)
Total Capital Deployed80,402,856 78,083,657 2,319,199 3%

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