There were 578 press releases posted in the last 24 hours and 165,010 in the last 365 days.

GWG Holdings, Inc. Reports Results for the First Quarter Ended March 31, 2019

/EIN News/ -- MINNEAPOLIS, Aug. 05, 2019 (GLOBE NEWSWIRE) -- GWG Holdings, Inc. (Nasdaq: GWGH), a financial services holding company committed to transforming the alternative asset industry through innovative liquidity products and related services for the owners of illiquid alternative investments, today announced its financial and operating results for the first quarter ended March 31, 2019.

First Quarter 2019 Financial and Operating Highlights

  • Realized a record $30.5 million of face amount of policy benefits from 20 life insurance policies;
  • Reported additional policy realizations of $30.7 million from 25 policies through July 31, 2019, bringing the 2019 total to $61.2 million from 45 policies.  This compares to total policy realizations of $71.1 million from 62 policies for the full year of 2018;
  • Acquired $80.2 million of face amount of policy benefits;
  • Ended the quarter with a life insurance portfolio of $2.098 billion in face amount of policy benefits consisting of 1,194 policies; and
  • Reported total assets of $1.6 billion.

1. Financial & Operating Highlights

($ Thousands except per share information)   Q1 2019   Q1 2018
Revenue   $ 25,217,000     $ 14,542,000  
Expenses     37,904,000       23,720,000  
Per Share Data1:                
Net Income (Loss)2     (0.57 )     (2.22 )
Capital Raised     125,985,000       87,526,000  
Liquidity3,4     183,896,000       141,897,000  
Life Insurance Portfolio5     2,098,428,000       1,758,066,000  
Life Insurance Acquired5     80,211,000       94,352,000  
Face Value of Matured Policies     30,459,000       14,504,000  
TTM Benefits / Premiums6     154.8 %     113.3 %

(1) Attributable to common shareholders
(2) Per basic and fully diluted share outstanding
(3) Includes cash, restricted cash and policy benefits receivable
(4) Cash, restricted cash and policy benefits receivable totaled $51.5 million on July 31, 2019
(5) Face amount of policy benefits
(6) The ratio of policy benefits recognized to premiums paid on a trailing twelve month (TTM) basis

2. Revenue and Expense Discussion

First Quarter 2019 vs. First Quarter 2018:

  • Total revenue was $25.2 million in the current period, compared to $14.5 million in the prior period primarily due to:
    • Higher gain from policy benefits due to increased realization of policy benefits – $30.5 million of life insurance policy benefits realized in the current period compared to $14.5 million in the prior period.
  • Total expenses were $37.9 million in the current period, compared to $23.7 million in the prior period primarily due to:
    • Increased interest expense of $10.9 million; and
    • Costs of $1.4 million relating to the YouSurance and Life Epigenetics wholly owned insurtech subsidiaries.

3. Life Insurance Portfolio Statistics

Portfolio Summary:

Total life insurance portfolio face value of policy benefits   $ 2,098,428,000  
Average face value per policy   $ 1,757,000  
Average face value per insured life   $ 1,885,000  
Average age of insured (years)     81.7  
Average life expectancy estimate (years)     7.6  
Total number of policies     1,194  
Number of unique lives     1,113  
Demographics     78% Male; 22% Female  
Number of smokers     53  
Largest policy as % of total portfolio face value     0.6 %
Average policy as % of total portfolio     0.1 %
Average annual premium as % of face value     3.0 %

Distribution of Policies and Benefits by Current Age of Insured:

                    Percentage of Total      
Min Age   Max Age   Number
of
Policies
    Policy
Benefits
    Number
of
Policies
    Policy
Benefits
    Wtd. Avg.
LE (yrs.)
95   100     18     $ 29,153,000       1.5 %     1.4 %     2.3
90   94     131       254,273,000       11.0 %     12.1 %     3.5
85   89     252       579,409,000       21.1 %     27.6 %     5.3
80   84     245       430,373,000       20.5 %     20.5 %     7.5
75   79     234       409,470,000       19.6 %     19.5 %     10.4
70   74     227       314,465,000       19.0 %     15.0 %     11.3
60   69     87       81,285,000       7.3 %     3.9 %     11.6
Total         1,194     $ 2,098,428,000       100.0 %     100.0 %     7.6
                                           
                                           

4. Life Insurance Policy Origination

Life Insurance Portfolio Activity:

      Three Months Ended
      March 31, 2019     March 31, 2018
             
Total policy benefits purchased   $ 80,211,000   $ 94,352,000
Total life insurance policies purchased     60     59
Average policy benefit purchased   $ 1,337,000   $ 1,599,000
Direct policy benefits purchased   $ 12,337,000   $ 5,000,000
Direct insurance policies purchased     16     11

5. Additional Information     

Gain (Loss) on Life Insurance Policies:

    Three Months Ended
March 31,
 
    2019     2018  
Change in estimated probabilistic cash flows(1)   $ 17,131,000     $ 19,005,000  
Unrealized gain on acquisitions(2)     4,459,000       6,974,000  
Premiums and other annual fees     (15,832,000 )     (12,197,000 )
Change in discount rates(3)     -       -  
Change in life expectancy evaluation(4)     -       (4,868,000 )
Face value of matured policies     30,459,000       14,504,000  
Fair value of matured policies     (14,721,000 )     (9,549,000 )
Gain (loss) on life insurance policies, net   $ 21,496,000     $ 13,869,000  

(1) Change in fair value of expected future cash flows from our life insurance policies not specifically attributable to other factors.
(2) Gain resulting from fair value in excess of the purchase price for life insurance policies acquired during the reporting period.
(3) The discount rate applied to estimate the fair value of the portfolio of life insurance policies we own was 8.25% at both March 31, 2019 and December 31, 2018, and 10.45% at both March 31, 2018 and December 31, 2017. See our Form 10-K filed with the Securities and Exchange Commission (SEC) on July 9, 2019 for important changes to how we estimate the discount rate for fair value purposes.
(4) The change in fair value due to updating life expectancy estimates on certain life insurance policies in our portfolio. See our Form 10-K filed with the SEC on July 9, 2019 for important changes to how we use updated life expectancy reports.

Policy Benefits Recognized and Premiums Paid (TTM):  

Quarter End Date   Portfolio
Face Amount ($)
  12-Month
Trailing
Benefits
Realized
($)
  12-Month
Trailing
Premiums
Paid ($)
  12-Month
Trailing
Benefits/Premium
Coverage
Ratio
June 30, 2015   806,274,000   47,125,000   24,348,000   193.5 %
September 30, 2015   878,882,000   44,482,000   25,313,000   175.7 %
December 31, 2015   944,844,000   31,232,000   26,650,000   117.2 %
March 31, 2016   1,027,821,000   21,845,000   28,771,000   75.9 %
June 30, 2016   1,154,798,000   30,924,000   31,891,000   97.0 %
September 30, 2016   1,272,078,000   35,867,000   37,055,000   96.8 %
December 31, 2016   1,361,675,000   48,452,000   40,239,000   120.4 %
March 31, 2017   1,447,558,000   48,189,000   42,753,000   112.7 %
June 30, 2017   1,525,363,000   49,295,000   45,414,000   108.5 %
September 30, 2017   1,622,627,000   53,742,000   46,559,000   115.4 %
December 31, 2017   1,676,148,000   64,719,000   52,263,000   123.8 %
March 31, 2018   1,758,066,000   60,248,000   53,169,000   113.3 %
June 30, 2018   1,849,079,000   76,936,000   53,886,000   142.8 %
September 30, 2018   1,961,598,000   75,161,000   55,365,000   135.8 %
December 31, 2018   2,047,992,000   71,090,000   52,675,000   135.0 %
March 31, 2019   2,098,428,000   87,045,000   56,227,000   154.8 %
                   

Earnings Webcast Details

Information will be forthcoming about an earnings webcast to discuss GWGH’s financial results.

About GWG Holdings, Inc. 

GWG Holdings, Inc. (Nasdaq: GWGH), the parent company of GWG Life, Life Epigenetics and YouSurance, is a leading provider of liquidity to consumers owning life insurance policies, an owner of a portfolio of alternative assets, and the developer of epigenetic technology for the life insurance and related industries. GWG Life provides value to consumers owning illiquid life insurance products across America, delivering $565 million more for their policies since 2006 than the cash surrender value on those policies. GWG Life owns a life insurance policy portfolio of $2.1 billion in face value of policy benefits as of March 31, 2019. Life Epigenetics is working to commercialize epigenetic technology for the life insurance and related industries. YouSurance, a digital life insurance agency, is working to embed epigenetic testing into life insurance purchasing to provide consumers a value-added ecosystem that supports their health and wellness while reducing the cost of their insurance. GWGH also has a strategic investment in The Beneficient Company Group, L.P., a financial services company providing proprietary liquidity solutions to owners of alternative assets.

For more information about GWG Holdings, email info@gwgh.com or visit www.gwgh.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, included in this press release regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and objectives of management are forward-looking statements. The words "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "would," "target" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These forward-looking statements include, among other things, statements about our estimates regarding future revenue and financial performance. We may not actually achieve the expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the expectations disclosed in the forward-looking statements that we make. More information about potential factors that could affect our business and financial results is contained in our filings with the Securities and Exchange Commission. Additional information will also be set forth in our future quarterly reports on Form 10-Q, annual reports on Form 10-K and other filings that we make with the Securities and Exchange Commission. We do not intend, and undertake no duty, to release publicly any updates or revisions to any forward-looking statements contained herein.

Media Contact:
Dan Callahan
Director of Communication
GWG Holdings, Inc.
(612) 746-1935
dcallahan@gwgh.com

   
GWG HOLDINGS, INC. AND SUBSIDIARIES  
CONSOLIDATED BALANCE SHEETS  
   
    March 31,
2019
(unaudited)
    December 31,
2018
 
ASSETS            
Cash and cash equivalents   $ 154,384,426     $ 114,587,084  
Restricted cash     20,311,646       10,849,126  
Investment in life insurance policies, at fair value     782,184,731       747,922,465  
Life insurance policy benefits receivable, net     9,200,000       16,460,687  
Financing receivable from affiliate     186,738,243       184,768,874  
Equity method investment     359,096,434       360,841,651  
Other assets     50,116,768       45,437,164  
TOTAL ASSETS   $ 1,562,032,248     $ 1,480,867,051  
                 
LIABILITIES & STOCKHOLDERS’ EQUITY                
LIABILITIES                
Senior credit facility with LNV Corporation   $ 146,868,215     $ 148,977,596  
L Bonds     756,397,420       651,402,663  
Seller Trust L Bonds     366,891,940       366,891,940  
Accounts payable     6,079,306       9,276,507  
Interest and dividends payable     18,506,588       18,555,293  
Other accrued expenses     6,030,841       4,705,170  
TOTAL LIABILITIES     1,300,774,310       1,199,809,169  
                 
STOCKHOLDERS’ EQUITY                
                 
REDEEMABLE PREFERRED STOCK                
(par value $0.001; shares authorized 100,000; shares outstanding 96,954 and
97,524; liquidation preference of $97,520,000 and $98,093,000 as of March
31, 2019 and December 31, 2018, respectively)
    86,340,335       86,910,335  
SERIES 2 REDEEMABLE PREFERRED STOCK                
(par value $0.001; shares authorized 150,000; shares outstanding 148,110 and
148,359; liquidation preference of $148,974,000 and $149,225,000 as of
March 31, 2019 and December 31, 2018, respectively)
    128,813,787       129,062,704  
COMMON STOCK                
(par value $0.001; shares authorized 210,000,000; shares issued and outstanding
32,992,606 as of March 31, 2019 and 33,018,161 as of December 31, 2018)
    32,993       33,018  
Additional paid-in capital     245,294,858       249,662,168  
Accumulated deficit     (199,224,035 )     (184,610,343 )
TOTAL STOCKHOLDERS’ EQUITY     261,257,938       281,057,882  
                 
TOTAL LIABILITIES & EQUITY   $ 1,562,032,248     $ 1,480,867,051  
                 
                 


GWG HOLDINGS, INC. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF OPERATIONS  
(unaudited)  
 
 
    Three Months Ended  
    March 31,
2019
    March 31,
2018
 
REVENUE            
Gain (loss) on life insurance policies, net   $ 21,496,390     $ 13,868,745  
Interest and other income     3,720,550       672,927  
TOTAL REVENUE     25,216,940       14,541,672  
                 
EXPENSES                
Interest expense     26,974,988       16,063,337  
Employee compensation and benefits     5,153,984       3,742,669  
Legal and professional fees     2,947,196       1,173,629  
Other expenses     2,827,721       2,740,577  
TOTAL EXPENSES     37,903,889       23,720,212  
                 
INCOME (LOSS) BEFORE INCOME TAXES     (12,686,949 )     (9,178,540 )
INCOME TAX EXPENSE (BENEFIT)     -       -  
                 
NET INCOME (LOSS) BEFORE EARNINGS FROM EQUITY METHOD INVESTMENT     (12,686,949 )     (9,178,540 )
                 
Earnings (loss) from equity method investment     (1,926,743 )     -  
                 
NET INCOME (LOSS)     (14,613,692 )     (9,178,540 )
                 
Preferred stock dividends     4,296,314       3,704,484  
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS   $ (18,910,006 )   $ (12,883,024 )
NET INCOME (LOSS) PER COMMON SHARE                
Basic   $ (0.57 )   $ (2.22 )
Diluted   $ (0.57 )   $ (2.22 )
                 
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING                
Basic     32,984,741       5,813,555  
Diluted     32,984,741       5,813,555  

Primary Logo

Distribution channels: Business & Economy, Insurance Industry


EIN Presswire does not exercise editorial control over third-party content provided, uploaded, published, or distributed by users of EIN Presswire. We are a distributor, not a publisher, of 3rd party content. Such content may contain the views, opinions, statements, offers, and other material of the respective users, suppliers, participants, or authors.