Reliance Global Group Achieves 92% Increase in Revenue for the Second Quarter of 2022

Rhea-AI Summary

Reliance Global Group (NASDAQ: RELI, RELIW) reported a 92% year-over-year increase in revenue for Q2 2022, reaching approximately $4.2 million, compared to $2.2 million in Q2 2021. This growth is attributed to acquisitions and organic expansion. However, operating expenses surged to $6.2 million, up from $3.3 million a year ago, primarily due to higher commissions and marketing costs. The company reported a net income of approximately $10.5 million, significantly improving from a loss of $1.3 million in Q2 2021, driven mainly by warrant liability adjustments.

Positive

• Revenue growth of 92% year-over-year for Q2 2022, totaling approximately $4.2 million.
• Net income for Q2 2022 of approximately $10.5 million, a reversal from a $1.3 million loss in Q2 2021.
• Successful acquisitions contributing to revenue and operational synergies.
• Over 30% growth in agent partners for the RELI Exchange platform within three months.

Negative

• Operating expenses for Q2 2022 rose to approximately $6.2 million from $3.3 million in Q2 2021.
• Increased operational costs, including higher commissions and marketing expenses, due to acquired agencies.

RELI Exchange driving agency partner channel growth

Company to host conference call today at 2:00 PM

LAKEWOOD, NJ, Aug. 15, 2022 (GLOBE NEWSWIRE) -- via NewMediaWire – Reliance Global Group, Inc. (Nasdaq: RELI; RELIW) (“Reliance”, “we” or the “Company”), which combines artificial intelligence (AI) and cloud-based technologies with the personalized experience of a traditional insurance agency, today provided a business update and reported financial results for the second quarter ended June 30, 2022.

Ezra Beyman, CEO of Reliance Global Group, commented, “We are extremely pleased to report a 92% year-over-year increase in revenue for the second quarter of 2022. Our strong growth reflects the successful acquisitions of JP Kush & Associates, Medigap Health Insurance Company and Barra & Associates. Importantly, we are also experiencing solid organic growth, which illustrates the synergies of our portfolio. As an example, we recently relaunched Barra & Associates as RELI Exchange, our new business-to-business InsurTech platform and agency partner network, which builds on the artificial intelligence and data mining backbone of 5MinuteInsure.com. RELI Exchange combines the best of digital and the human element by providing agents and customers quotes from multiple carriers within minutes, while reducing back office expenses and driving operational efficiency. Due to the competitive advantages and compelling value proposition of our platform, we are aggressively adding new agency partners to RELI Exchange, as evidenced by an increase in agents of more than 30% in just three months. We are committed to achieving our goal of building RELI Exchange into the largest agency partner network in the U.S. Overall, we have built a highly scalable business model that we believe will drive significant shareholder value for years to come.”

Financial results for the three months ended June 30, 2022

• Revenue for the three months ended June 30, 2022, was approximately $4.2 million, an increase of approximately 92%, compared to $2.2 million for the three months ended June 30, 2021. The increase of $2.0 million was primarily driven by expanded operations, both organic and due to the additional insurance agencies acquired throughout 2021 and 2022.
• Operating expenses for the three months ended June 30, 2022, were approximately $6.2 million, compared to approximately $3.3 million for the three months ended June 30, 2021. The increase in operating expenses was primarily attributable to higher commission expenses, salaries, and wages, general and administrative, advertising and marketing expenses, reflecting operating expenses of the acquired insurance agencies during 2021 and 2022, as well as increased expenses to support the Company’s growth. Operating expenses also included certain non-cash expenses and non-recurring expenses related to financing activities.
• Net income for three months ended June 30, 2022, was approximately $10.5 million, compared to a loss of $1.3 million for the same period last year. The increase is primarily attributable to the recognition and change in fair value of warrant liabilities of $12.6 million.
  
  

Financial results for the six months ended June 30, 2022

• Revenue for the six months ended June 30, 2022, was approximately $8.4 million, an increase of approximately 86.7%, compared to $4.5 million for the six months ended June 30, 2021. The increase was primarily driven by expanded operations, both organic and due to the additional insurance agencies acquired throughout 2021 and 2022.
• Operating expenses for the six months ended June 30, 2022, were approximately $12.8 million, compared to approximately $6.1 million for the six months ended June 30, 2021. The increase in operating expenses was primarily attributable to higher commission expense, salaries, and wages, general and administrative, advertising and marketing expenses, reflecting operating expenses of the acquired insurance agencies during 2021 and 2022, as well as increased expenses to support the Company’s growth. Operating expenses also included certain non-cash expenses and non-recurring expenses related to financing activities.
• Net income for six months ended June 30, 2022, was approximately $19.8 million, compared to a loss of $1.9 million for the same period last year is attributable primarily to the recognition and change in fair value of warrant liabilities of $24.5 million.
  
  

The complete financial results will be available in the Company’s Form 10-Q, which is expected to be filed with the U.S. Securities & Exchange Commission later today.

Conference Call

Reliance Global Group will host a conference call today at 2:00 P.M. Eastern Time to discuss the Company’s financial results for the second quarter ended June 30, 2022, as well as the Company’s corporate progress and other developments.

The conference call will be available via telephone by dialing toll free 888-506-0062 for U.S. callers or +1 973-528-0011 for international callers and using entry code: 581329. A webcast of the call may be accessed at https://www.webcaster4.com/Webcast/Page/2381/46386 or on the investor relations section of the Company’s website at https://relianceglobalgroup.com/investor-relations/.

A webcast replay will also be available on the Company’s Investors section of the website (https://relianceglobalgroup.com/investor-relations/) through August 15, 2023. A telephone replay of the call will be available approximately one hour following the call, through August 29, 2022, and can be accessed by dialing 877-481-4010 for U.S. callers or +1 919-882-2331 for international callers and entering conference ID: 46386.

About Reliance Global Group, Inc.

Reliance Global Group, Inc. (NASDAQ: RELI, RELIW) is combining advanced technologies with the personalized experience of a traditional insurance agency model. Reliance Global Group’s growth strategy is focused on both organic expansion, including 5minuteinsure.com and RELI Exchange, as well as acquiring well managed, undervalued and cash flow positive insurance agencies. Additional information about the Company is available at https://www.relianceglobalgroup.com/.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. In some cases, forward-looking statements can be identified by terminology such as “may,” “should,” “potential,” “continue,” “expects,” “anticipates,” “intends,” “plans,” “believes,” “estimates,” and similar expressions and include statements such achieving the Company’s goal of building RELI Exchange into the largest agency partner network in the U.S. and driving significant shareholder value for years to come Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission and elsewhere and risk as and uncertainties related to: the Company’s ability to generate the revenue anticipated and the ability to build the RELI Exchange into the largest agency partner network in the U.S., and the other factors described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021. The foregoing review of important factors that could cause actual events to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere, including the risk factors included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2021, the Company’s Quarterly Reports on Form 10-Q, the Company’s recent Current Reports on Form 8-K and subsequent filings with the Securities and Exchange Commission. The Company undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

Contact:
Crescendo Communications, LLC
Tel: +1 (212) 671-1020
Email: RELI@crescendo-ir.com

FAQ

What was Reliance Global Group's revenue for Q2 2022?

Reliance Global Group reported approximately $4.2 million in revenue for Q2 2022, marking a 92% increase from the prior year.

How much did Reliance Global Group earn in net income for Q2 2022?

The company reported a net income of approximately $10.5 million for Q2 2022, compared to a loss of $1.3 million in Q2 2021.

What are the primary drivers of Reliance Global Group's revenue growth?

Revenue growth is primarily driven by successful acquisitions and organic growth from the company's expanded operations.

What challenges did Reliance Global Group face in terms of expenses?

The company faced increased operating expenses, which rose to approximately $6.2 million for Q2 2022, mainly due to higher commission and marketing costs.

What is the current trend in agent partnerships for RELI Exchange?

RELI Exchange saw over 30% growth in agent partners over a three-month period, reflecting strong interest in the platform.