Abacus Global Management (ABL) Sidoti Micro-Cap Virtual Conference summary

Business overview and strategy

• Focuses on life settlements, acquiring life insurance policies and placing them with institutional investors as an uncorrelated asset class.

• Has grown from a small team to over 150 employees and went public on Nasdaq in July 2023, with two equity raises since.

• Maintains a high-growth, high-margin business model with a significant competitive moat from 30 years of discipline and network.

• Direct-to-consumer and wealth manager channels are expanding, reducing reliance on brokers and improving margins.

• Diversifies through ABL Wealth (financial planning) and ABL Tech (mortality data services).

Financial performance and capital deployment

• Q3 revenue was $28.1 million, nearly matching Q2's $29.1 million, with stable EBITDA and improved margins.

• Deployed $93.2 million in capital in Q3 and $104.7 million in Q2, acquiring life insurance policies.

• Return on equity opportunities in the portfolio exceed 20%, driving recent equity raises.

• Holds policies on the balance sheet for an average of 116 days, aiming for flexibility and accretion benefits.

• Carrier buybacks and tertiary market participation are growing components of the business.

Market dynamics and growth drivers

• U.S. life insurance market is $13 trillion, with a $250 billion annual addressable market for life settlements.

• Institutional interest in mortality as an asset class is increasing, supporting market health and placement opportunities.

• Direct-to-consumer marketing generates 12,000 leads monthly, primarily through traditional TV and radio advertising.

• Institutional involvement is seen as a tailwind, increasing competition for policies and supporting margins.

• ABL Tech's mortality data service, launched in March 2024, has 25 clients and high-margin potential.