Second Quarter of Fiscal Year 2025 – Consolidated Earnings
Highlights
- Revenue of $481.1 million
- Net income of $53.2 million
- Adjusted EBITDA* of $87.5 million
Fiscal Year 2025 Guidance Ranges:
- Revenue expected in a range of $1.500 billion to $1.575
billion
- Net income (loss) expected in a range of $(24) million to $11
million
- Adjusted EBITDA* expected in a range of $115 million to $140
million
Second Quarter Fiscal Year 2025 – Segment Highlights
Senior
- Revenue of $255.6 million
- Adjusted EBITDA* of $100.5 million
- Approved Medicare Advantage policies of 247,849
Healthcare Services
- Revenue of $183.4 million
- Adjusted EBITDA* of $2.2 million
- 96,695 SelectRx members
Life
- Revenue of $39.9 million
- Adjusted EBITDA* of $7.4 million
SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for
the second quarter of fiscal year 2025 of $481.1 million compared
to consolidated revenue for the second quarter of fiscal year 2024
of $405.4 million. Consolidated net income for the second quarter
of fiscal year 2025 was $53.2 million compared to consolidated net
income for the second quarter of fiscal year 2024 of $19.4 million.
Finally, consolidated Adjusted EBITDA* for the second quarter of
fiscal year 2025 was $87.5 million compared to consolidated
Adjusted EBITDA* for the second quarter of fiscal year 2024 of
$67.4 million.
SelectQuote Chief Executive Officer, Tim Danker, remarked,
“SelectQuote delivered impressive results during our fiscal second
quarter despite a historically disruptive Annual Enrollment Period.
Our strong policy volume and Senior Adjusted EBITDA margin of 39%,
up approximately 750 basis points year-over-year, are additional
proof points of our differentiated, high-touch, agent-led model.
American Seniors faced an unprecedented level of plan terminations
and benefit changes this season, and we take great pride in that
fact that consumers sought out SelectQuote as they navigated such a
challenging market backdrop. As we’ve said before, SelectQuote wins
when our customers win, and this quarter is evidence of that.”
Mr. Danker continued, “SelectQuote also delivered another
quarter of strong results within our Healthcare Services segment,
led by SelectRx. We now have over 96,000 members, which represents
growth of 54% compared to a year ago. Importantly, we expanded our
global Revenue to CAC to 5.3X, which demonstrates our continued
ability to generate attractive returns as a comprehensive
healthcare services provider.”
“Additionally, we took another large step to improve our capital
structure with today’s announcement of a $350 million strategic
investment led by Bain Capital and Morgan Stanley Private Credit.
The transaction provides improved liquidity and operating
flexibility to grow within our Senior and Healthcare Services
businesses. We are excited to have Bain Capital and Morgan Stanley
Private Credit as strategic partners as we pursue the tremendous
growth opportunity provided by our unique platform within the
healthcare ecosystem.”
* See “Non-GAAP Financial Measures” below.
Segment Results
We currently have three reportable segments: 1) Senior, 2)
Healthcare Services and 3) Life. The performance measures of the
segments include total revenue and Adjusted EBITDA.* Costs of
commissions and other services revenue, cost of goods sold-pharmacy
revenue, marketing and advertising, selling, general, and
administrative, and technical development operating expenses that
are directly attributable to a segment are reported within the
applicable segment. Indirect costs of revenue, marketing and
advertising, selling, general, and administrative, and technical
development operating expenses are allocated to each segment based
on varying metrics such as headcount. Adjusted EBITDA is our
segment profit measure to evaluate the operating performance of our
business. We define Adjusted EBITDA as income (loss) before income
tax expense (benefit) plus: (i) interest expense, net; (ii)
depreciation and amortization; (iii) share-based compensation; (iv)
goodwill, long-lived asset, and intangible assets impairments; (v)
transaction costs; (vi) loss on disposal of property, equipment and
software, net; (vii) other non-recurring expenses and income;
(viii) changes in fair value of warrant liabilities. Adjusted
EBITDA Margin is calculated as Adjusted EBITDA divided by
revenue.
Senior
Financial Results
The following table provides the financial results for the
Senior segment for the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
255,578
$
247,529
3
%
$
348,487
$
337,445
3
%
Adjusted EBITDA*
100,521
78,713
28
%
108,247
77,376
40
%
Adjusted EBITDA Margin*
39
%
32
%
31
%
23
%
Operating Metrics
Submitted Policies
Submitted policies are counted when an individual completes an
application with our licensed agent and provides authorization to
the agent to submit the application to the insurance carrier
partner. The applicant may have additional actions to take before
the application will be reviewed by the insurance carrier.
The following table shows the number of submitted policies for
the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
284,774
271,712
5
%
387,055
376,244
3
%
All other (1)
26,861
24,049
12
%
43,117
38,969
11
%
Total
311,635
295,761
5
%
430,172
415,213
4
%
(1) Represents the submitted policies for medicare supplement,
dental, vision and hearing, prescription drug plan and other.
Approved Policies
Approved policies represents the number of submitted policies
that were approved by our insurance carrier partners for the
identified product during the indicated period. Not all approved
policies will go in force.
* See “Non-GAAP Financial Measures” below.
The following table shows the number of approved policies for
the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
247,849
234,576
6
%
339,529
332,257
2
%
All other (1)
19,714
19,985
(1
)%
32,693
32,180
2
%
Total
267,563
254,561
5
%
372,222
364,437
2
%
(1) Represents the approved policies for medicare supplement,
dental, vision and hearing, prescription drug plan and other.
Lifetime Value of Commissions per Approved Policy
Lifetime value of commissions per approved policy represents
commissions estimated to be collected over the estimated life of an
approved policy based on multiple factors, including but not
limited to, contracted commission rates, carrier mix and expected
policy persistency with applied constraints. The lifetime value of
commissions per approved policy is equal to the sum of the
commission revenue due upon the initial sale of a policy, and when
applicable, an estimate of future renewal commissions.
The following table shows the lifetime value of commissions per
approved policy for the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
(dollars per policy):
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
$
907
$
934
(3
)%
$
881
$
883
—
%
All other (1)
111
112
(1
)%
134
131
2
%
(1) Represents the weighted average LTV per approved policy.
Healthcare Services
Financial Results
The following table provides the financial results for the
Healthcare Services segment for the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
183,370
$
111,710
64
%
$
339,108
$
209,078
62
%
Adjusted EBITDA*
2,212
2,981
(26
)%
7,089
5,304
34
%
Adjusted EBITDA Margin*
1
%
3
%
2
%
3
%
Operating Metrics
Members
The total number of SelectRx members represents the amount of
active customers to which an order has been shipped and the
prescriptions per day represents the total average prescriptions
shipped per business day. These two metrics are the primary drivers
of revenue for Healthcare Services.
* See “Non-GAAP Financial Measures” below.
The following table shows the total number of SelectRx members
as of the periods presented:
December 31, 2024
December 31, 2023
Total SelectRx Members
96,695
62,623
The total number of SelectRx members increased by 54% as of
December 31, 2024, compared to December 31, 2023, due to our
continued operating strategy to grow SelectRx.
The following table shows the average prescriptions shipped per
day for the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
2024
2023
2024
2023
Prescriptions Per Day
26,846
17,010
25,922
16,244
Combined Senior and Healthcare Services - Consumer Per Unit
Economics
The opportunity to leverage our existing database and
distribution model to improve access to healthcare services for our
consumers has created a need for us to review our key metrics
related to our per unit economics. As we think about the revenue
and expenses for Healthcare Services, we note that they are
primarily driven by the marketing acquisition costs associated with
the sale of an MA or MS policy, some of which costs are allocated
directly to Healthcare Services, and therefore determined that our
per unit economics measure should include components from both
Senior and Healthcare Services. See details of revenue and expense
items included in the calculation below.
Combined Senior and Healthcare Services consumer per unit
economics represents total MA and MS commissions; other product
commissions; other revenues, including revenues from Healthcare
Services; and operating expenses associated with Senior and
Healthcare Services, each shown per number of approved MA and MS
policies over a given time period. Management assesses the business
on a per-unit basis to help ensure that the revenue opportunity
associated with a successful policy sale is attractive relative to
the marketing acquisition cost. Because not all acquired leads
result in a successful policy sale, all per-policy metrics are
based on approved policies, which is the measure that triggers
revenue recognition.
The MA and MS commission per MA/MS policy represents the LTV for
policies sold in the period. Other commission per MA/MS policy
represents the LTV for other products sold in the period, including
DVH prescription drug plan, and other products, which management
views as additional commission revenue on our agents’ core function
of MA/MS policy sales. Pharmacy revenue per MA/MS policy represents
revenue from SelectRx, and other revenue per MA/MS policy
represents revenue from Population Health, production bonuses,
marketing development funds, lead generation revenue, and
adjustments from the Company’s reassessment of its cohorts’
transaction prices. Total operating expenses per MA/MS policy
represents all of the operating expenses within Senior and
Healthcare Services. The revenue to customer acquisition cost
(“CAC”) multiple represents total revenue as a multiple of total
marketing acquisition cost, which represents the direct costs of
acquiring leads. These costs are included in marketing and
advertising expense within the total operating expenses per MA/MS
policy.
The following table shows combined Senior and Healthcare
Services consumer per unit economics for the periods presented.
Based on the seasonality of Senior and the fluctuations between
quarters, we believe that the most relevant view of per unit
economics is on a rolling 12-month basis. All per MA/MS policy
metrics below are based on the sum of approved MA/MS policies, as
both products have similar commission profiles.
Twelve Months Ended December
31,
(dollars per approved policy):
2024
2023
MA and MS approved policies
634,135
609,939
MA and MS commission per MA / MS
policy
$
909
$
896
Other commission per MA/MS policy
12
11
Pharmacy revenue per MA/MS policy
938
575
Other revenue per MA/MS policy
153
140
Total revenue per MA / MS policy
2,012
1,622
Total operating expenses per MA / MS
policy
(1,685
)
(1,365
)
Adjusted EBITDA per MA/MS policy *
$
327
$
257
Adjusted EBITDA Margin per MA/MS policy
*
16
%
16
%
Revenue / CAC multiple
5.3X
4.2X
Total revenue per MA/MS policy increased 24% for the twelve
months ended December 31, 2024, compared to the twelve months ended
December 31, 2023, primarily due to the increase in pharmacy
revenue. Total operating expenses per MA/MS policy increased 23%
for the twelve months ended December 31, 2024, compared to the
twelve months ended December 31, 2023, driven by an increase in
cost of goods sold-pharmacy revenue for Healthcare Services due to
the growth of the business.
Life
Financial Results
The following table provides the financial results for the Life
segment for the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
39,861
$
37,367
7
%
$
79,151
$
75,170
5
%
Adjusted EBITDA*
7,423
4,569
62
%
13,383
9,808
36
%
Adjusted EBITDA Margin*
19
%
12
%
17
%
13
%
Operating Metrics
Life premium represents the total premium value for all policies
that were approved by the relevant insurance carrier partner and
for which the policy document was sent to the policyholder and
payment information was received by the relevant insurance carrier
partner during the indicated period. Because our commissions are
earned based on a percentage of total premium, total premium volume
for a given period is the key driver of revenue for our Life
segment.
The following table shows term and final expense premiums for
the periods presented:
Three Months Ended December
31,
Six Months Ended December
31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Term Premiums
$
17,311
$
17,398
(1
)%
$
32,529
$
35,588
(9
)%
Final Expense Premiums
22,139
19,388
14
%
46,612
39,087
19
%
Total
$
39,450
$
36,786
7
%
$
79,141
$
74,675
6
%
* See “Non-GAAP Financial Measures” below.
Earnings Conference Call
SelectQuote, Inc. will host a conference call with the
investment community on February 10, 2025, beginning at 5:00 p.m.
ET. To register for this conference call, please use this link:
https://registrations.events/direct/Q4I731198247. After
registering, a confirmation will be sent via email, including
dial-in details and unique conference call codes for entry.
Registration is open through the live call, but to ensure you are
connected for the full call we suggest registering at least 10
minutes before the start of the call. The event will also be
webcasted live via our investor relations website
https://ir.selectquote.com/investor-home/default.aspx.
Non-GAAP Financial Measures
This release includes certain non-GAAP financial measures
intended to supplement, not substitute for, comparable GAAP
measures. To supplement our financial statements presented in
accordance with GAAP and to provide investors with additional
information regarding our GAAP financial results, we have presented
in this release Adjusted EBITDA and Adjusted EBITDA Margin, which
are non-GAAP financial measures. These non-GAAP financial measures
are not based on any standardized methodology prescribed by GAAP
and are not necessarily comparable to similarly titled measures
presented by other companies. We define Adjusted EBITDA as net
income (loss) before income tax expense (benefit), plus interest
expense, depreciation and amortization, changes in fair value of
warrant liabilities, and certain add-backs for non-cash or
non-recurring expenses, including restructuring and share-based
compensation expenses. The most directly comparable GAAP measure is
income (loss) before tax expense (benefit). We define Adjusted
EBITDA Margin as Adjusted EBITDA divided by revenue. The most
directly comparable GAAP measure is net income margin. We monitor
and have presented in this release Adjusted EBITDA and Adjusted
EBITDA Margin because they are key measures used by our management
and Board of Directors to understand and evaluate our operating
performance, to establish budgets, and to develop operational goals
for managing our business. In particular, we believe that excluding
the impact of these expenses in calculating Adjusted EBITDA can
provide a useful measure for period-to-period comparisons of our
core operating performance. We believe that these non-GAAP
financial measures help identify underlying trends in our business
that could otherwise be masked by the effect of the expenses that
we exclude in the calculations of these non-GAAP financial
measures. Accordingly, we believe that these financial measures
provide useful information to investors and others in understanding
and evaluating our operating results, enhancing the overall
understanding of our past performance and future prospects.
Reconciliations of net income (loss) before income tax expense
(benefit) to Adjusted EBITDA are presented below beginning on page
11.
Forward Looking Statements
This release contains forward-looking statements. These
forward-looking statements reflect our current views with respect
to, among other things, future events and our financial
performance. These statements are often, but not always, made
through the use of words or phrases such as “may,” “should,”
“could,” “predict,” “potential,” “believe,” “will likely result,”
“expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,”
“intend,” “plan,” “projection,” “would” and “outlook,” or the
negative version of those words or other comparable words or
phrases of a future or forward-looking nature. These
forward-looking statements are not historical facts, and are based
on current expectations, estimates and projections about our
industry, management’s beliefs and certain assumptions made by
management, many of which, by their nature, are inherently
uncertain and beyond our control. Accordingly, we caution you that
any such forward-looking statements are not guarantees of future
performance and are subject to risks, assumptions and uncertainties
that are difficult to predict. Although we believe that the
expectations reflected in these forward-looking statements are
reasonable as of the date made, actual results may prove to be
materially different from the results expressed or implied by the
forward-looking statements.
There are or will be important factors that could cause our
actual results to differ materially from those indicated in these
forward-looking statements, including, but not limited to, the
following: our reliance on a limited number of insurance carrier
partners and any potential termination of those relationships or
failure to develop new relationships; existing and future laws and
regulations affecting the health insurance market; changes in
health insurance products offered by our insurance carrier partners
and the health insurance market generally; insurance carriers
offering products and services directly to consumers; changes to
commissions paid by insurance carriers and underwriting practices;
competition with brokers, exclusively online brokers and carriers
who opt to sell policies directly to consumers; competition from
government-run health insurance exchanges; developments in the U.S.
health insurance system; our dependence on revenue from carriers in
our senior segment and downturns in the senior health as well as
life, automotive and home insurance industries; our ability to
develop new offerings and penetrate new vertical markets; risks
from third-party products; failure to enroll individuals during the
Medicare annual enrollment period; our ability to attract,
integrate and retain qualified personnel; our dependence on lead
providers and ability to compete for leads; failure to obtain
and/or convert sales leads to actual sales of insurance policies;
access to data from consumers and insurance carriers; accuracy of
information provided from and to consumers during the insurance
shopping process; cost-effective advertisement through internet
search engines; ability to contact consumers and market products by
telephone; global economic conditions, including inflation;
disruption to operations as a result of future acquisitions;
significant estimates and assumptions in the preparation of our
financial statements; impairment of goodwill; potential litigation
and other legal proceedings or inquiries; our existing and future
indebtedness; our ability to maintain compliance with our debt
covenants; access to additional capital; failure to protect our
intellectual property and our brand; fluctuations in our financial
results caused by seasonality; accuracy and timeliness of
commissions reports from insurance carriers; timing of insurance
carriers’ approval and payment practices; factors that impact our
estimate of the constrained lifetime value of commissions per
policyholder; changes in accounting rules, tax legislation and
other legislation; disruptions or failures of our technological
infrastructure and platform; failure to maintain relationships with
third-party service providers; cybersecurity breaches or other
attacks involving our systems or those of our insurance carrier
partners or third-party service providers; our ability to protect
consumer information and other data; failure to market and sell
Medicare plans effectively or in compliance with laws; and other
factors related to our pharmacy business, including manufacturing
or supply chain disruptions, access to and demand for prescription
drugs, and regulatory changes or other industry developments that
may affect our pharmacy operations. For a further discussion of
these and other risk factors that could impact our future results
and performance, see the section entitled “Risk Factors” in the
most recent Annual Report on Form 10-K (the “Annual Report”) and
subsequent periodic reports filed by us with the Securities and
Exchange Commission. Accordingly, you should not place undue
reliance on any such forward-looking statements. Any
forward-looking statement speaks only as of the date on which it is
made, and, except as otherwise required by law, we do not undertake
any obligation to publicly update or review any forward-looking
statement, whether as a result of new information, future
developments or otherwise.
About SelectQuote:
Founded in 1985, SelectQuote (NYSE: SLQT) pioneered the model of
providing unbiased comparisons from multiple, highly-rated
insurance companies, allowing consumers to choose the policy and
terms that best meet their unique needs. Two foundational pillars
underpin SelectQuote’s success: a strong force of highly-trained
and skilled agents who provide a consultative needs analysis for
every consumer, and proprietary technology that sources and routes
high-quality leads. Today, the Company operates an ecosystem
offering high touchpoints for consumers across insurance, pharmacy,
and virtual care.
With an ecosystem offering engagement points for consumers
across insurance, Medicare, pharmacy, and value-based care, the
company now has three core business lines: SelectQuote Senior,
SelectQuote Healthcare Services, and SelectQuote Life. SelectQuote
Senior serves the needs of a demographic that sees around 10,000
people turn 65 each day with a range of Medicare Advantage and
Medicare Supplement plans. SelectQuote Healthcare Services is
comprised of the SelectRx Pharmacy, a Patient-Centered Pharmacy
Home™ (PCPH) accredited pharmacy, SelectPatient Management, a
provider of chronic care management services, and Healthcare Select
which proactively connects consumers with a wide breadth of
healthcare services supporting their needs.
SELECTQUOTE, INC. AND
SUBSIDIARIES
CONSOLIDATED BALANCE
SHEETS
(Unaudited)
(In thousands)
December 31, 2024
June 30, 2024
ASSETS
CURRENT ASSETS:
Cash and, cash equivalents, and restricted
cash
$
12,104
$
42,690
Accounts receivable, net of allowances of
$12.1 million and $8.2 million, respectively
115,795
150,035
Commissions receivable-current
224,787
119,871
Other current assets
19,686
20,327
Total current assets
372,372
332,923
COMMISSIONS RECEIVABLE—Net
812,037
761,446
PROPERTY AND EQUIPMENT—Net
16,257
18,973
SOFTWARE—Net
14,127
13,978
OPERATING LEASE RIGHT-OF-USE ASSETS
22,002
23,437
INTANGIBLE ASSETS—Net
8,130
10,194
GOODWILL
29,438
29,438
OTHER ASSETS
4,804
3,519
TOTAL ASSETS
$
1,279,167
$
1,193,908
LIABILITIES AND SHAREHOLDERS’
EQUITY
CURRENT LIABILITIES:
Accounts payable
$
87,165
$
36,587
Accrued expenses
12,617
16,904
Accrued compensation and benefits
55,666
57,594
Operating lease liabilities—current
4,981
4,709
Current portion of long-term debt
27,577
45,854
Contract liabilities
954
8,066
Other current liabilities
5,440
4,873
Total current liabilities
194,400
174,587
LONG-TERM DEBT, NET—less current
portion
684,284
637,480
DEFERRED INCOME TAXES
31,868
37,478
OPERATING LEASE LIABILITIES
23,539
25,685
OTHER LIABILITIES
19,074
1,877
Total liabilities
953,165
877,107
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value
1,721
1,694
Additional paid-in capital
585,360
580,764
Accumulated deficit
(261,079
)
(269,769
)
Accumulated other comprehensive income
—
4,112
Total shareholders’ equity
326,002
316,801
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
$
1,279,167
$
1,193,908
SELECTQUOTE, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
COMPREHENSIVE LOSS
(Unaudited)
(In thousands)
Three Months Ended December
31,
Six Months Ended December
31,
2024
2023
2024
2023
REVENUE:
Commissions and other services
$
301,069
$
296,643
$
440,449
$
434,584
Pharmacy
180,000
108,795
332,883
203,583
Total revenue
481,069
405,438
773,332
638,167
OPERATING COSTS AND EXPENSES:
Cost of commissions and other services
revenue
101,138
97,424
166,872
169,935
Cost of goods sold—pharmacy revenue
156,201
94,180
285,724
178,188
Marketing and advertising
97,725
117,078
161,489
179,400
Selling, general, and administrative
45,021
33,412
81,166
62,078
Technical development
10,044
8,050
19,119
15,687
Total operating costs and expenses
410,129
350,144
714,370
605,288
INCOME FROM OPERATIONS
70,940
55,294
58,962
32,879
INTEREST EXPENSE, NET
(23,721
)
(24,415
)
(46,752
)
(45,811
)
OTHER EXPENSE, NET
(7,663
)
—
(7,674
)
(39
)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE
(BENEFIT)
39,556
30,879
4,536
(12,971
)
INCOME TAX EXPENSE (BENEFIT)
(13,680
)
11,487
(4,154
)
(1,312
)
NET INCOME (LOSS)
$
53,236
$
19,392
$
8,690
$
(11,659
)
NET INCOME (LOSS) PER SHARE:
Basic
$
0.31
$
0.12
$
0.05
$
(0.07
)
Diluted
$
0.30
$
0.11
$
0.05
$
(0.07
)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING
USED IN PER SHARE AMOUNTS:
Basic
171,802
168,349
171,116
167,901
Diluted
175,101
169,737
175,024
167,901
OTHER COMPREHENSIVE INCOME (LOSS) NET OF
TAX:
Change in cash flow hedge
(1,327
)
(3,422
)
(4,112
)
(5,432
)
OTHER COMPREHENSIVE INCOME (LOSS)
(1,327
)
(3,422
)
(4,112
)
(5,432
)
COMPREHENSIVE INCOME (LOSS)
$
51,909
$
15,970
$
4,578
$
(17,091
)
SELECTQUOTE, INC. AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CASH FLOWS
(Unaudited)
(In thousands)
Six months ended December
31,
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)
$
8,690
$
(11,659
)
Adjustments to reconcile net income (loss)
to net cash, cash equivalents, and restricted cash used in
operating activities:
Depreciation and amortization
10,659
11,887
Loss on disposal of property, equipment,
and software
157
9
Share-based compensation expense
8,545
6,997
Deferred income taxes
(4,154
)
(1,182
)
Amortization of debt issuance costs and
debt discount
2,379
3,356
Write-off of debt issuance costs
93
—
Change in fair value of warrant
liabilities
7,642
—
Accrued interest payable in kind
9,673
9,020
Non-cash lease expense
1,846
1,528
Bad debt expense
4,203
2,743
Changes in operating assets and
liabilities:
Accounts receivable, net
30,038
9,232
Commissions receivable
(155,507
)
(113,860
)
Other assets
(4,802
)
(2,075
)
Accounts payable and accrued expenses
46,211
29,206
Operating lease liabilities
(2,285
)
(2,689
)
Other liabilities
(8,692
)
8,248
Net cash used in operating activities
(45,304
)
(49,239
)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment
(741
)
(2,062
)
Proceeds from sales of property and
equipment
—
253
Purchases of software and capitalized
software development costs
(4,105
)
(3,883
)
Net cash used in investing activities
(4,846
)
(5,692
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from revolving line of credit
84,900
—
Payments on revolving line of credit
(26,900
)
—
Payments on Term Loans
(123,215
)
(16,942
)
Proceeds on ABS Notes
99,095
—
Payments on ABS Notes
(6,272
)
—
Payments on other debt
(114
)
(75
)
Proceeds from common stock options
exercised and employee stock purchase plan
38
—
Payments of tax withholdings related to
net share settlement of equity awards
(3,960
)
(359
)
Payments of debt issuance costs
(2,479
)
—
Net cash provided (used in) financing
activities
21,093
(17,376
)
NET DECREASE IN CASH, CASH EQUIVALENTS AND
RESTRICTED CASH
(29,057
)
(72,307
)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
—Beginning of period
42,690
83,156
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
—End of period
$
13,633
$
10,849
SELECTQUOTE, INC. AND
SUBSIDIARIES
Adjusted EBITDA to Income
(Loss) before income tax expense (benefit) Reconciliation
(Unaudited)
Three Months Ended December
31, 2024
(in thousands)
Senior
Healthcare Services
Life
Total
Adjusted Segment EBITDA
$
100,521
$
2,212
$
7,423
$
110,156
All other Adjusted EBITDA
2,303
Corporate & elimination of
intersegment profits
(24,940
)
Adjusted EBITDA
$
87,519
Share-based compensation expense
(4,699
)
Transaction costs
(6,719
)
Depreciation and amortization
(5,060
)
Loss on disposal of property, equipment,
and software, net
(122
)
Change in fair value of warrant
liabilities
(7,642
)
Interest expense, net
(23,721
)
Income before income tax expense
(benefit)
$
39,556
Three Months Ended December
31, 2023
(in thousands)
Senior
Healthcare Services
Life
Total
Adjusted Segment EBITDA
$
78,713
$
2,981
$
4,569
$
86,263
All other Adjusted EBITDA
4,725
Corporate & elimination of
intersegment profits
(23,574
)
Adjusted EBITDA
$
67,414
Share-based compensation expense
(3,822
)
Transaction costs
(2,400
)
Depreciation and amortization
(5,898
)
Loss on disposal of property, equipment,
and software, net
—
Interest expense, net
(24,415
)
Income before income tax expense
(benefit)
$
30,879
Six Months Ended December 31,
2024
(in thousands)
Senior
Healthcare Services
Life
Total
Adjusted Segment EBITDA
$
108,247
$
7,089
$
13,383
$
128,719
All other Adjusted EBITDA
6,099
Corporate & elimination of
intersegment profits
(48,983
)
Adjusted EBITDA
$
85,835
Share-based compensation expense
(8,545
)
Transaction costs
(7,544
)
Depreciation and amortization
(10,659
)
Loss on disposal of property, equipment,
and software, net
(157
)
Change in fair value of warrant
liabilities
(7,642
)
Interest expense, net
(46,752
)
Income before income tax expense
(benefit)
$
4,536
Six Months Ended December 31,
2023
(in thousands)
Senior
Healthcare Services
Life
Total
Adjusted Segment EBITDA
$
77,376
$
5,304
$
9,808
$
92,488
All other Adjusted EBITDA
8,045
Corporate & elimination of
intersegment profits
(44,495
)
Adjusted EBITDA
$
56,038
Share-based compensation expense
(6,997
)
Transaction costs
(4,305
)
Depreciation and amortization
(11,887
)
Loss on disposal of property, equipment,
and software, net
(9
)
Interest expense, net
(45,811
)
Loss before income tax expense
(benefit)
$
(12,971
)
SELECTQUOTE, INC. AND
SUBSIDIARIES
Net Income (Loss) to Adjusted
EBITDA Reconciliation
(Unaudited)
Guidance Net income (loss) to Adjusted
EBITDA reconciliation, year ending June 30, 2025:
(in thousands)
Range
Net income (loss)
$
(24,000
)
$
11,000
Income tax expense (benefit)
(7,000
)
2,000
Interest expense, net
85,000
75,000
Depreciation and amortization
24,000
20,000
Share-based compensation expense
19,000
16,000
Change in FV of warrant liability
8,000
8,000
Transaction costs
10,000
8,000
Adjusted EBITDA
$
115,000
$
140,000
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250210814597/en/
Investor Relations: Sloan Bohlen 877-678-4083
investorrelations@selectquote.com
Media: Matt Gunter 913-286-4931 matt.gunter@selectquote.com
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