Reliance Global Group 2025 Q3 Earnings Call - Strategic Asset Sale Strengthens Balance Sheet and Propels InsureTech Growth

Jordan, Conference Operator: Thank you for standing by. My name is Jordan, and I’ll be your conference operator today. At this time, I’d like to welcome everyone to the Reliance Global Group third-quarter business update conference call. All lines have been placed on mute to prevent any background noise. At the end of the call, there’ll be a question-and-answer session. In order to ask a question, press star, one on your telephone keypad. I would now like to turn the conference over to Ted Avas of Investor Relations. You may begin.

Ted Avas, Investor Relations, Reliance Global Group: Thanks, Jordan. Good afternoon, and thank you for joining Reliance Global Group’s 2025 third-quarter financial results and business update conference call. On the call with us today are Ezra Beyman, Chairman and Chief Executive Officer of Reliance Global Group, and Joel Markovits, Chief Financial Officer at Reliance. Earlier today, the company announced its operating results for the quarter ended September 30, 2025, and the press release is posted on the company’s website, www.relianceglobalgroup.com. In addition, the company filed its quarterly report on Form 10-Q with the US Securities and Exchange Commission, which can also be accessed on the company’s website as well as the SEC’s website at www.sec.gov. If you have any questions after the call or would like any additional information about Reliance, please contact Crescendo Communications at 212-671-1020. Before Mr.

Beyman reviews the company’s operating results for the quarter ended September 30, 2025. We would like to remind everybody that this conference call may contain forward-looking statements. All statements other than statements of historical facts contained in the call, including statements regarding our future results of operations and financial position, strategy and plans, and our expectations for future operations, are forward-looking statements. The words anticipate, estimate, expect, project, plan, seek, intend, believe, may, might, will, should, could, likely, design, and continue, and the negative of such terms and other words and terms of similar expressions are intended to identify forward-looking statements. These forward-looking statements are based largely on the company’s current expectations and projections about future events and trends that it believes may affect its financial condition, results of operations, strategy, short-term and long-term business operations and objectives, and financial needs.

These forward-looking statements are subject to several risks, uncertainties, and assumptions as described in the company’s Form 10-K filed with the US Securities and Exchange Commission. Because of these risks, uncertainties, and assumptions, the forward-looking events and circumstances discussed in the call may not occur, and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. Although the company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, level of activity, performance, or achievements. In addition, neither the company nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. The company disclaims any duty to update any of these forward-looking statements.

All forward-looking statements attributable to the company are expressly qualified in their entirety by these cautionary statements as well as others made on the conference call. You should evaluate all forward-looking statements made by the company in the context of these risks and uncertainties. Having said that, I’d now like to turn the call over to Ezra Beyman, Chairman and Chief Executive Officer of Reliance Global Group. Ezra?

Ezra Beyman, Chairman and Chief Executive Officer, Reliance Global Group: Thanks, Ted. Good afternoon, and thank you, everyone, for joining us today. The third quarter marked another important step forward in Reliance’s transformation and execution of our long-term growth strategy. During the quarter, we completed the $5 million sale of Fortman Insurance Services, a wholly-owned subsidiary that had been part of our portfolio since 2019. The transaction was an important strategic step in our broader effort to streamline operations and focus resources on higher-margin technology-driven business segments. Fortman was a solid, well-managed business that performed well under our ownership. The sale allowed us to realize the value we had created since the acquisition and redeploy that capital toward initiatives with greater long-term scalability and alignment with our strategic priorities. We completed the sale, monetizing the asset at an approximate $3 million gain, which reflects both the operational value built over time and the disciplined execution of our portfolio strategy.

The proceeds added capital to our balance sheet, which we immediately used to reduce long-term debt by approximately 50%, significantly improving our financial flexibility and enabling us to focus on scaling higher-margin business segments through our Reliance Exchange platform. As a result of this and other prudent financial management steps taken, our unrestricted cash rose by approximately 590%, or $2.6 million compared to the prior fiscal year end, while working capital increased by $1.2 million, or 284%, and equity grew by $3.7 million, or 125%. Together, these achievements demonstrate our continued progress in building a stronger, more resilient balance sheet that supports sustainable growth. As expected, the sale of Fortman reduced short-term commission income, reflecting the divestiture of the asset. However, the transaction also eliminated related salary expenses and contributed to a leaner, more efficient operating model.

At the same time, we continue to advance our Reliance Exchange platform, the cornerstone of our InsureTech growth strategy, with the launch of our new client service center, a major enhancement that streamlines how our agency partners operate. The service center provides centralized support for day-to-day policy administration, including coverage changes, mortgage e-clause updates, and renewals, through a seamless white-label digital interface. This allows partners to focus on expanding their book of business and strengthening client relationships while our in-house team efficiently manages servicing behind the scenes. By improving scalability, client satisfaction, and partner productivity, this initiative is creating a smarter, more efficient operating model that positions Reliance for sustained profitability and long-term value creation.

The result is a smarter, more scalable model that improves client satisfaction, increases partner productivity, and reinforces our broader One-Firm Strategy by integrating technology and centralized resources to enhance collaboration, reduce redundancy, and drive profitability across the platform. The board of directors also approved the company’s first special cash dividend of $0.0003 per share. $0.03 per share, payable on or about December 22nd—I’m sorry, December 2nd, 2025—to shareholders of record as of October 30th, 2025. This dividend is a meaningful way to reward our shareholders for the continued support as we execute on our growth strategy. Over the past several quarters, we’ve strengthened both our financial position and operating performance, and this distribution reflects that progress. It also demonstrates the disciplined approach we’re taking to capital allocation, balancing reinvestment in our InsureTech and agency operations with returning value directly to shareholders.

The dividend aligns with our broader long-term strategy, which includes the diversification of our treasury through our digital asset treasury initiative, or DAT. Since launching the DAT earlier this year, we’ve taken a disciplined approach to building a measured and diversified position in leading digital assets, including Ethereum, Cardano, Bitcoin, XRP, and Solana. Each selected for its unique strengths from Bitcoin’s scarcity and institutional adoption to Ethereum’s smart contract capabilities, Cardano’s sustainability, and XRP’s enterprise-grade payment functionality, and Solana’s speed and scalability. Guided by our own Crypto Advisory Board, this initiative represents a forward-looking extension of our capital strategy, balancing innovation with financial responsibility. It’s more than a financial program. It’s part of our vision to position Reliance at the intersection of InsureTech, AI, and blockchain innovation, enhancing our balance sheet, maintaining liquidity, support growth, and creating long-term growth for our shareholders.

Looking ahead, we believe Reliance is stronger and more focused than ever. Our actions this quarter, streamlining operations, enhancing technology, recruiting shareholders, and positioning the company at the forefront of innovation, have created a solid foundation for continued growth. We remain committed to executing with discipline, driving profitability, and building long-term value for our shareholders. I would now like to turn the call over to Joel Markovits, Chief Financial Officer of Reliance Global Group, to review the financial results for the quarter ended September 30, 2025. Joel?

Joel Markovits, Chief Financial Officer, Reliance Global Group: Thank you very much, Ezra, and good afternoon. It’s my pleasure to review some of our key financial highlights for the quarter ended September 30, 2025. All figures presented are approximates. Let’s start with liquidity. As Ezra mentioned, it was significantly strengthened through prudent financial management. Unrestricted cash increased by approximately 590% to $2.6 million, an increase of $2.2 million compared to the prior fiscal year end. Continuing with the comparison to the 2024 fiscal year end, working capital increased by $1.2 million, or 284%, to $1.6 million, and equity increased by $3.7 million, or 125%, to $6.8 million. This reflects our continued focus on strengthening our balance sheet and maintaining financial flexibility to support our growth initiatives. Switching gears to the income statement, commission income totaled $2.5 million for this quarter compared to $3.4 million in 2024.

The change is primarily driven by the decrease in revenue following the asset sale of Fortman and lower medical commission revenues. Commission expense was $1 million for this quarter compared to $0.9 million in 2024. The slight increase is primarily influenced by market conditions and inherent competitiveness across the insurance sector. Salaries and wages were $3.9 million this quarter versus $1.7 million in 2024. Change is primarily attributed to non-cash equity grants, partially offset by decreased payroll pursuant to the Fortman subsidiary asset sale. General and administrative expenses came in at $1.1 million this quarter versus $0.8 million in 2024. The change is primarily attributed to non-employee non-cash equity payments, partially offset by less costs pursuant to the Fortman sale, one-firm efficiencies, and overall leaner operations. We recognized a gain on sale from the Fortman subsidiary transaction of $3 million.

Net loss for the quarter was $1.2 million compared to $0.8 million in the prior year. Change is primarily driven by the gain on sale from Fortman but offset by non-cash equity compensation. Adjusted EBITDA loss for the quarter in non-GAAP metric was $700,000 compared to a gain of $40,000 in 2024, and the change is primarily attributed to the fluctuations we discussed in the commission accounts. In summary, I’d like to stress that the third quarter reflected exciting progress across several key areas of our business, including. One, a much stronger balance sheet with increased cash, increased working capital, increased equity, and significantly reduced fixed debt. Two, a leaner and more efficient cost structure resulting from ongoing one-firm integration and operational streamlining. Three, our strategic reinvestment in technology and the Reliance Exchange platform to enhance scalability and partner productivity.

Four, the rollout and continued execution of our digital asset treasury strategy, positioning Reliance at the forefront of innovation in InsureTech, AI, and blockchain integration. Number five, the declaration of a special cash dividend to our much-valued shareholders. We’ll now turn it back to the operator to open the lines for questions, comments, and our feedback. Operator?

Jordan, Conference Operator: Thank you. We’ll now begin the question-and-answer session. If you have dialed in and you would like to ask a question, please press Star 1 on your telephone keypad to raise your hand and join the queue. If you’d like to withdraw your question, simply press Star 1 again. We’ll just take a moment to compile the Q&A roster. Your first question comes from the line of Ellen Litvak from Chorus Capital. Your line is live.

Ellen Litvak, Analyst, Chorus Capital: Hi. Thank you for taking my question. Also, congrats on the sale of Fortman and, of course, also the improvements in the balance sheet. Obviously, the stock dividend was a positive sign of your confidence on the outlook for the business. My question is, was this a one-time dividend or something you would consider again in the future quarters?

Ezra Beyman, Chairman and Chief Executive Officer, Reliance Global Group: Thank you for the compliment. No, it is certainly something that we are thinking about for the future as well, the dividends. We believe in giving it back to the shareholders, so we are certainly giving it consideration.

Ellen Litvak, Analyst, Chorus Capital: Thank you. I appreciate that. I’ll hop back on the queue if you have any other further questions. Thanks again.

Ezra Beyman, Chairman and Chief Executive Officer, Reliance Global Group: Thank you.

Jordan, Conference Operator: As a reminder, if you’d like to ask a question, press Star 1 on your telephone keypad. We’ll just take another moment while we wait for any other questions. It seems that’s all the questions we have for today. I’d like to turn the call back over to our operator or moderators for their final closing remarks.

Joel Markovits, Chief Financial Officer, Reliance Global Group: Thank you. On behalf of the entire Reliance team, we thank you very much for joining us today for our third quarterly business update. We’re thrilled about the progress we’ve made and are confident that we will continue to drive sustainable value for our highly valued shareholders, partners, and employees. We look forward to our next business update. Until then, we wish you all the very best.

Jordan, Conference Operator: Thank you. That concludes today’s meeting. You may now disconnect.