Release Date: August 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Abacus Life Inc (ABL, Financial) more than doubled its total revenue year over year to $29.1 million in the second quarter of 2024.
- The company achieved an 83% year-over-year growth in adjusted EBITDA, reaching $16.7 million.
- Abacus Life Inc (ABL) announced a definitive agreement to acquire Carlisle Management Company, adding approximately $2 billion in assets under management.
- The company successfully closed an oversubscribed public offering, raising over $90 million in proceeds.
- Abacus Life Inc (ABL) established a national distribution relationship with Amcor, enhancing its market reach and distribution capabilities.
Negative Points
- Total operating expenses for the second quarter of 2024 increased significantly to $18.9 million compared to $1.3 million in the prior year period.
- The adjusted EBITDA margin decreased to 57.5% from 80.4% in the prior year period.
- GAAP net income attributable to stockholders for the quarter was only $0.8 million, a decrease from $6.8 million in the prior year period.
- The company incurred $6.2 million in non-cash stock compensation expense and $0.8 million in public company related expenses, which were not present in the prior year period.
- There were technical difficulties during the earnings call, which disrupted communication and may have affected the clarity of the presentation.
Q & A Highlights
Q: Can you discuss the deployment of the $90 million raised in June and your capacity for deployment going forward?
A: Jay Jackson, CEO: We were able to deploy some of the capital quickly due to pent-up inventory. We expect to have the majority of the capital deployed before year-end, possibly as early as Q3. The market conditions are favorable for us, and we see continued growth opportunities into 2025.
Q: What are your expectations for adjusted EBITDA for the full year, considering the $28 million generated in the first half?
A: Jay Jackson, CEO: We had a strong Q2 and aim to manage expectations for Q3 and Q4. We feel positive about the numbers projected by analysts and expect to maintain profitability through the end of the year.
Q: Can you provide details on the active management revenue, which more than doubled to $27 million?
A: Jay Jackson, CEO: The increase is due to deploying capital from our follow-on investments. We expect this level of revenue to be sustainable and profitable, with no fall-off in return on equity. We anticipate maintaining these numbers through the end of the year.
Q: What is your strategy for future M&A, considering the recent acquisitions of Carlisle and FCF Advisors?
A: Jay Jackson, CEO: Carlisle was a unique opportunity with a strong track record. We aim to integrate and drive profitability in both acquired businesses. We will continue to be opportunistic and strategic in future M&A, focusing on expanding ABL Wealth.
Q: How is Abacus Tech progressing, particularly with potential clients like governments, insurance companies, and pensions?
A: William McCauley, CFO: ABL Tech is growing as planned, with new clients being added. We see it as a growth opportunity for recurring earnings and are optimistic about its future potential.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
