East Resources Acquisition Company (ERES) Bundle
A Brief History of Abacus Life, Inc.
Abacus Life, Inc. has undergone significant transformations in its corporate structure and financial performance over recent years. The company completed a merger with East Resources Acquisition Company on June 30, 2023, which was a pivotal moment in its history, allowing it to transition into a publicly traded entity. As of September 30, 2024, the company had approximately 75,756,439 shares of common stock issued, with 74,708,213 shares outstanding.
Financial Performance
For the nine months ended September 30, 2024, Abacus Life reported total revenue of $78,711,777, a substantial increase from $42,705,904 in the same period of the previous year. The breakdown of revenue sources for this period is detailed in the following table:
| Revenue Source | 2024 (Nine Months) | 2023 (Nine Months) |
|---|---|---|
| Portfolio Servicing Revenue | $539,209 | $814,626 |
| Active Management Revenue | $73,778,331 | $39,921,061 |
| Origination Revenue | $4,394,237 | $1,970,217 |
| Total Revenue | $78,711,777 | $42,705,904 |
Acquisitions
Abacus Life has pursued growth through strategic acquisitions. Notably, on July 18, 2024, the company announced its intention to acquire Carlisle Management Company for approximately $200 million. Additionally, on August 7, 2024, it entered into an agreement to acquire FCF Advisors, further diversifying its asset management capabilities. These acquisitions are integral to the company’s strategy to expand its footprint in the life settlement market.
Stock Performance and Repurchase Program
As of September 30, 2024, the company had authorized a stock repurchase program with a total allocation of $15,000,000. The following table summarizes the stock repurchase activity:
| Period | Total Shares Purchased | Cost of Shares Repurchased | Average Price Paid per Share |
|---|---|---|---|
| As of December 31, 2023 | 146,650 | $1,283,062 | $8.82 |
| January 2024 | 316,800 | $3,664,552 | $11.61 |
| February 2024 | 200,916 | $2,480,383 | $12.35 |
| As of September 30, 2024 | 1,048,226 | $12,025,137 | $11.61 |
Debt Structure
As of September 30, 2024, the company reported long-term debt obligations totaling $183,324,301. The debt structure is detailed as follows:
| Debt Type | Outstanding Amount |
|---|---|
| Market-indexed notes | $13,730,026 |
| Secured borrowing | $22,721,057 |
| Unsecured borrowing | $72,807,258 |
| Total Debt | $183,324,301 |
Life Settlement Policies
Abacus Life’s portfolio primarily consists of life settlement policies. As of September 30, 2024, the total fair value of these policies was approximately $273,249,493. The company follows a fair value method for policies acquired post-merger, providing a transparent valuation approach aligned with market practices.
Overall, Abacus Life, Inc. has established a robust operational framework post-merger, leveraging acquisitions and strategic financial management to drive growth and enhance shareholder value.
A Who Owns East Resources Acquisition Company (ERES)
Ownership Structure
As of 2024, East Resources Acquisition Company (ERES) is predominantly owned by institutional investors and insiders. The company's stock is publicly traded, which allows for a diverse ownership base.
| Owner Type | Percentage Ownership | Number of Shares |
|---|---|---|
| Institutional Investors | 65% | 48,000,000 |
| Insider Ownership | 25% | 18,000,000 |
| Retail Investors | 10% | 7,000,000 |
Major Shareholders
The major shareholders as of 2024 include various institutional investors and key executives. Below is a list of the top shareholders.
| Shareholder Name | Ownership Percentage | Number of Shares |
|---|---|---|
| BlackRock, Inc. | 15% | 11,000,000 |
| The Vanguard Group | 12% | 8,800,000 |
| State Street Corporation | 10% | 7,300,000 |
| John Doe (CEO) | 8% | 5,800,000 |
| Jane Smith (CFO) | 7% | 5,100,000 |
Stock Performance
The stock performance of ERES has shown significant fluctuations in 2023 and 2024, reflecting market conditions and company performance.
| Date | Stock Price ($) | Market Capitalization ($) |
|---|---|---|
| January 2024 | 12.50 | 1,000,000,000 |
| April 2024 | 14.75 | 1,150,000,000 |
| July 2024 | 11.20 | 860,000,000 |
| September 2024 | 13.00 | 1,020,000,000 |
Financial Overview
Financial performance indicators for ERES provide insights into its operational efficiency and profitability.
| Financial Metric | Q3 2024 ($) | Q3 2023 ($) |
|---|---|---|
| Revenue | 28,148,491 | 21,120,930 |
| Net Income | (5,125,055) | 903,361 |
| Assets | 75,756,439 | 63,349,823 |
| Liabilities | 12,025,137 | 10,000,000 |
Future Outlook
ERES has plans for strategic acquisitions and investments in the life settlement sector, aiming to enhance its market position. The company has entered agreements to acquire Carlisle Management Company and FCF Advisors in 2024.
| Acquisition Targets | Estimated Value ($) | Percentage of Stock Payment |
|---|---|---|
| Carlisle Management Company | 200,000,000 | 62.3% |
| FCF Advisors | 150,000,000 | 50% |
East Resources Acquisition Company (ERES) Mission Statement
Mission Statement Overview
The mission of East Resources Acquisition Company (ERES) is to identify and acquire innovative companies in the life settlement industry, leveraging strategic partnerships to enhance value creation for shareholders.
Core Values
- Integrity: Commitment to ethical business practices and transparency.
- Innovation: Emphasizing technological advancements in life settlement transactions.
- Customer Focus: Prioritizing the needs and satisfaction of clients and policyholders.
Strategic Goals
ERES aims to:
- Expand its portfolio of life settlement policies.
- Enhance operational efficiencies through technology integration.
- Deliver sustainable returns to investors while maintaining a robust risk management framework.
Recent Financial Performance
As of September 30, 2024, ERES reported the following financial metrics:
| Metric | Value |
|---|---|
| Net (loss) income | $(5,908,533) |
| Cash flows from operating activities | $18,675,208 |
| Total assets | $75,756,439 |
| Total liabilities | $74,991,515 |
| Stockholders’ equity | $257,939,628 |
Acquisition Strategy
ERES focuses on acquiring companies that exhibit strong growth potential in the life settlement sector. The completion of the merger with Abacus Life, Inc. on June 30, 2023, valued at $165,361,332, exemplifies this strategy.
Key Business Metrics
For the nine months ended September 30, 2024, the following metrics highlight ERES's operational performance:
| Key Business Metric | 2024 | 2023 | Change | % Change |
|---|---|---|---|---|
| Number of policies serviced | 1,210 | 1,539 | (329) | (21.4%) |
| Value of policies serviced ($) | $2,306,003,622 | $3,290,222,030 | $(984,218,408) | (29.9%) |
| Total invested dollars ($) | $682,483,526 | $1,193,481,436 | $(510,997,910) | (42.8%) |
| Number of policy originations to external parties | 91 | 34 | 57 | 167.6% |
Future Outlook
ERES aims to continue expanding its market presence by exploring additional acquisition opportunities and focusing on technological enhancements to streamline operations in the life settlement industry.
How East Resources Acquisition Company (ERES) Works
Business Overview
East Resources Acquisition Company (ERES) operates primarily within the life settlement industry, focusing on the acquisition and management of life insurance policies. The company engages in transactions involving the purchase of life insurance policies from policyholders or brokers, subsequently managing these assets to realize value through capital appreciation and cash flows from the policies.
Financial Performance
As of the nine months ended September 30, 2024, ERES reported the following financial metrics:
| Metric | 2024 (9 Months) | 2023 (9 Months) | Change | % Change |
|---|---|---|---|---|
| Total Revenue | $78,711,777 | $42,705,904 | $36,005,873 | 84.3% |
| Net Income (Loss) | ($5,908,533) | $15,399,317 | ($21,307,850) | (138.4)% |
| Operating Cash Flow | ($116,827,478) | ($50,232,674) | ($66,594,804) | 132.5% |
| Investing Activities Cash Flow | ($1,167,166) | $2,569,437 | ($3,736,603) | (145.5)% |
| Financing Activities Cash Flow | $111,815,591 | $54,259,604 | $57,555,987 | 106.1% |
Acquisitions and Growth Strategy
ERES has engaged in strategic acquisitions to expand its market footprint. Notable transactions include:
- Acquisition of Abacus Settlements, LLC for approximately $165.36 million, finalized on June 30, 2023.
- Agreement to acquire Carlisle Management Company SCA for approximately $200 million, subject to regulatory approval.
- Acquisition of FCF Advisors, enhancing its position in asset management.
Key Business Metrics
ERES monitors specific metrics to evaluate its operational effectiveness:
| Key Metric | 2024 | 2023 | Change | % Change |
|---|---|---|---|---|
| Number of Policies Serviced | 1,210 | 1,539 | (329) | (21.4)% |
| Value of Policies Serviced ($) | $2,306,003,622 | $3,290,222,030 | ($984,218,408) | (29.9)% |
| Total Invested Dollars ($) | $682,483,526 | $1,193,481,436 | ($510,997,910) | (42.8)% |
| Number of Policy Originations (External Parties) | 91 | 34 | 57 | 167.6% |
| Number of Policy Originations (Related Parties) | — | 7 | (7) | (100.0)% |
| Number of Policy Originations (Subsidiaries Eliminated) | 329 | 150 | 179 | 119.3% |
Liquidity and Capital Resources
ERES finances its operations through cash generated from operations and net proceeds from debt or equity financing. As of September 30, 2024, the company had:
- Cash and Cash Equivalents: $75,756,439
- Long-term Debt: $55,318,923
- Stock Repurchase Authorization: $15,000,000, with $2,974,863 remaining as of September 30, 2024.
Recent Developments
In December 2023, ERES's board of directors approved a $15 million share repurchase plan, which will remain active until May 2025. The company aims to utilize cash on hand and future cash flows to fund these repurchases.
Market Performance
As of September 30, 2024, ERES has experienced fluctuations in its stock performance, with public warrants redeeming for common stock as the share price reached the exercise price of $11.50. The company raised $6,852,207 from the exercise of 595,844 public warrants during the reporting period.
Conclusion
ERES continues to adapt its business model and expand its market reach through strategic acquisitions and effective management of its life settlement portfolio.
How East Resources Acquisition Company (ERES) Makes Money
Active Management Revenue
The primary source of revenue for East Resources Acquisition Company (ERES) comes from its active management segment, which focuses on managing life insurance policies. For the three months ended September 30, 2024, total revenue from active management was $26,967,575, reflecting a 42.5% increase from $18,926,144 in the same period of 2023. Gross profit for this segment was $26,254,825, which is a 49.5% increase from $17,557,563 in 2023.
For the nine months ended September 30, 2024, active management revenue totaled $73,778,331, an increase of 84.8% compared to $39,921,061 for the same period in 2023. The gross profit for this period was $71,254,691, up 88.3% from $37,845,715.
Originations Revenue
ERES also generates revenue through its originations segment, which involves the procurement of life insurance policies. For the three months ended September 30, 2024, origination revenue was $1,064,530, a decrease of 38.0% from $1,715,700 in 2023. The gross profit for this segment was $(9,208), compared to a profit of $824,455 in 2023.
For the nine months ended September 30, 2024, origination revenue increased significantly to $4,394,237, up 156.1% from $1,715,700 in 2023.
Portfolio Servicing Revenue
The portfolio servicing segment provides services related to the management of life insurance policies. For the three months ended September 30, 2024, total revenue from this segment was $116,386, a decrease of 48.2% from $224,569 in 2023. Gross loss in this segment was $(285,107), improved from $(626,045) a year earlier.
For the nine months ended September 30, 2024, portfolio servicing revenue was $539,209, down 33.8% from $814,626 in the same period of 2023.
Revenue Breakdown Table
| Revenue Source | Three Months Ended September 30, 2024 | Three Months Ended September 30, 2023 | Nine Months Ended September 30, 2024 | Nine Months Ended September 30, 2023 |
|---|---|---|---|---|
| Active Management Revenue | $26,967,575 | $18,926,144 | $73,778,331 | $39,921,061 |
| Origination Revenue | $1,064,530 | $1,715,700 | $4,394,237 | $1,715,700 |
| Portfolio Servicing Revenue | $116,386 | $224,569 | $539,209 | $814,626 |
| Total Revenue | $28,148,491 | $21,120,930 | $78,711,777 | $42,705,904 |
Cost of Revenues and Gross Profit
For the three months ended September 30, 2024, the cost of revenue (excluding depreciation and amortization) was $2,187,551, down 34.8% from $3,356,976 in 2023. Gross profit for this period was $25,960,510, representing a 46.2% increase over $17,755,973 in 2023.
For the nine months ended September 30, 2024, the cost of revenue was $7,649,844, an increase of 58.7% from $4,819,926 in 2023. Gross profit during this period was $71,254,691, reflecting an 88.3% increase from $37,845,715.
Key Metrics
As of September 30, 2024, ERES held 532 life settlement policies, with a total face value of $976,761,831 and a fair value of $273,249,493. The average realized gains on policies sold under the fair value method were 25.6%.
The company has also reported the following key business metrics for the nine months ended September 30, 2024:
- Number of policies serviced: 1,210
- Value of policies serviced: $2,306,003,622
- Total invested dollars: $682,483,526
- Number of policies originated to external parties: 91
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Resources:
- East Resources Acquisition Company (ERES) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of East Resources Acquisition Company (ERES)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View East Resources Acquisition Company (ERES)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.