0001794783false00017947832024-11-042024-11-04




UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________

FORM 8-K
_______________________________________

CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 4, 2024
_____________________________________

SELECTQUOTE, INC.
(Exact name of registrant as specified in its charter)
_____________________________________
Delaware
 001-39295
94-3339273
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
6800 West 115th Street, Suite 2511
Overland Park, Kansas 66211
(Address of principal executive offices) (Zip code)
(913) 599-9225
(Registrant’s telephone number, including area code)
No change since last report
(Former Name or Address, If Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.01 par valueSLQTNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 2.02    Results of Operations and Financial Condition.

On November 4, 2024, the Company reported its financial results for the first quarter ended September 30, 2024. Copies of the related press release and investor presentation are attached hereto as Exhibits 99.1 and 99.2, respectively, and are incorporated herein by reference.

These exhibits are being furnished pursuant to Item 2.02, and the information contained therein shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall either of them be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits.

(d) Exhibits
Exhibit No.
Description of Exhibit
Press Release
Investor Presentation
104Cover Page Interactive Data File (embedded within the Inline XBRL document)



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

SELECTQUOTE, INC.

Date: November 4, 2024
By: /s/ Ryan M. Clement         
Name: Ryan M. Clement
Title: Chief Financial Officer











Exhibit 99.1
SelectQuote, Inc. Reports First Quarter of Fiscal Year 2025 Results

First Quarter of Fiscal Year 2025 – Consolidated Earnings Highlights

•Revenue of $292.3 million
•Net loss of $44.5 million
•Adjusted EBITDA* of $(1.7) million

Fiscal Year 2025 Guidance Ranges:

•Revenue expected in a range of $1.425 billion to $1.525 billion
•Net income (loss) expected in a range of $(59) million to $3 million
•Adjusted EBITDA* expected in a range of $100 million to $130 million

First Quarter Fiscal Year 2025 – Segment Highlights

Senior
•Revenue of $92.9 million
•Adjusted EBITDA* of $7.7 million
•Approved Medicare Advantage policies of 91,680

Healthcare Services
•Revenue of $155.7 million
•Adjusted EBITDA* of $4.9 million
•86,521 SelectRx members

Life
•Revenue of $39.3 million
•Adjusted EBITDA* of $6.0 million

OVERLAND PARK, Kan., November 4, 2024--(BUSINESS WIRE)--SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the first quarter of fiscal year 2025 of $292.3 million compared to consolidated revenue for the first quarter of fiscal year 2024 of $232.7 million. Consolidated net loss for the first quarter of fiscal year 2025 was $44.5 million compared to consolidated net loss for the first quarter of fiscal year 2024 of $31.1 million. Finally, consolidated Adjusted EBITDA* for the first quarter of fiscal year 2025 was $(1.7) million compared to consolidated Adjusted EBITDA* for the first quarter of fiscal year 2024 of $(11.4) million.

SelectQuote Chief Executive Officer, Tim Danker, remarked, “SelectQuote opened our fiscal 2025 with a strong quarter and our holistic approach to healthcare connectivity between Americans in need of care, and the insurers and caregivers that provide it, has never been more valuable. As reported in the market, benefit coverage for Medicare Advantage plans shifted significantly this season, and we are pleased to say that both seniors and insurance carriers have increasingly turned to SelectQuote’s agent-led, true-choice platform to ensure individual care needs are met with the best plan available. When our customers and carrier partners benefit, so do our performance metrics and shareholders, and we proud of this alignment.”

Mr. Danker continued, “This quarter was also a success for our broadening Healthcare Services platform led by SelectRx. Our bespoke prescription drug service now has over 86 thousand members, which represents growth of over 64% compared to a year ago. Separately, SelectQuote recently announced our initial receivable securitization, which was a critical first step in our ongoing strategy to improve our capital flexibility.”

“We look forward to sharing our AEP results next quarter and are excited by the value our differentiated model continues to provide to a large and growing population of American seniors,” Mr. Danker concluded.




* 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 net loss plus: (i) interest expense, net; (ii) expense (benefit) for income taxes; (iii) depreciation and amortization; (iv) share-based compensation; (v) goodwill, long-lived asset, and intangible assets impairments; (vi) transaction costs; (vii) loss on disposal of property, equipment and software, net; and (viii) other non-recurring expenses and income. 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:

(in thousands)
1Q 2025
1Q 2024
% Change
Revenue$92,908 $89,918 3 %
Adjusted EBITDA*7,724 (1,335)679 %
Adjusted EBITDA Margin*8 %(1)%

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:

1Q 2025
1Q 2024
% Change
Medicare Advantage102,281104,532(2)%
All other (1)
16,25614,9209 %
Total118,537119,452(1)%
(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:

1Q 2025
1Q 2024
% Change
Medicare Advantage91,68097,681(6)%
All other (1)
12,97912,1956 %
Total104,659109,876(5)%
(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:

(dollars per policy):
1Q 2025
1Q 2024
% Change
Medicare Advantage$812 $761 7 %
All other (1)
165164— %
(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:

(in thousands)
1Q 2025
1Q 2024
% Change
Revenue$155,739 $97,368 60 %
Adjusted EBITDA*4,878 2,322 110 %
Adjusted EBITDA Margin*3 %2 %
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.

The following table shows the total number of SelectRx members as of the periods presented:

September 30, 2024September 30, 2023
Total SelectRx Members86,52152,750

The total number of SelectRx members increased by 64% as of September 30, 2024, compared to September 30, 2023, due to our continued operating strategy to grow SelectRx.






* See “Non-GAAP Financial Measures” below.


The following table shows the average prescriptions shipped per day for the periods presented:

September 30, 2024September 30, 2023
Prescriptions Per Day
24,99815,479

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 derived from 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 September 30,
(dollars per approved policy):20252024
MA and MS approved policies621,040 594,554 
MA and MS commission per MA / MS policy$919 $872 
Other commission per MA/MS policy12 13 
Pharmacy revenue per MA/MS policy842 493 
Other revenue per MA/MS policy152 151 
Total revenue per MA / MS policy1,925 1,529 
Total operating expenses per MA / MS policy(1,626)(1,278)
Adjusted EBITDA per MA/MS policy *$299 $251 
Adjusted EBITDA Margin per MA/MS policy *16 %16 %
Revenue / CAC multiple 4.6X  4.3X



Total revenue per MA/MS policy increased 26% for the twelve months ended September 30, 2024, compared to the twelve months ended September 30, 2023, primarily due to the increase in pharmacy revenue. Total operating expenses per MA/MS policy increased 27% for the twelve months ended September 30, 2024, compared to the twelve months ended September 30, 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:

(in thousands)
1Q 2025
1Q 2024
% Change
Revenue$39,290 $37,803 4 %
Adjusted EBITDA*5,960 5,240 14 %
Adjusted EBITDA Margin*15 %14 %

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:

(in thousands)
1Q 2025
1Q 2024
% Change
Term Premiums$15,218 $18,190 (16)%
Final Expense Premiums24,473 19,699 24 %
Total$39,691 $37,889 5 %





* See “Non-GAAP Financial Measures” below.


Earnings Conference Call

SelectQuote, Inc. will host a conference call with the investment community on November 4, 2024, beginning at 8:30 a.m. ET. To register for this conference call, please use this link: https://registrations.events/direct/Q4I1559258472. 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 interest expense, income tax expense (benefit), depreciation and amortization, 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 net income (loss). 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) to Adjusted EBITDA are presented below beginning on page 13.

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: impacts of the COVID-19 pandemic and any other significant public health events; 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; our ability to regain and maintain compliance with NYSE listing standards; 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 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) provides solutions that help consumers protect their most valuable assets: their families, health, and property. The company 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.

With an ecosystem offering high touchpoints for consumers across Insurance, Medicare, Pharmacy, and Value-Based Care, the company now has four core business lines: SelectQuote Senior, SelectQuote Healthcare Services, SelectQuote Life, and SelectQuote Auto and Home. 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 specialized medication management pharmacy, and Population Health which proactively connects its members with best-in-class healthcare services that fit each member's unique healthcare needs. The platform improves health outcomes and lowers healthcare costs through proactive engagement and access to high-value healthcare solutions.

Investor Relations:
Sloan Bohlen
877-678-4083
investorrelations@selectquote.com

Media:
Matt Gunter
913-286-4931
matt.gunter@selectquote.com

Source: SelectQuote, Inc.



SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)

September 30, 2024June 30, 2024
ASSETS
CURRENT ASSETS:
Cash and cash equivalents$10,444 $42,690 
Accounts receivable, net of allowances of $10.1 million and $8.2 million, respectively99,534 150,035 
Commissions receivable-current176,760 119,871 
Other current assets20,144 20,327 
Total current assets306,882 332,923 
COMMISSIONS RECEIVABLE—Net743,024 761,446 
PROPERTY AND EQUIPMENT—Net18,191 18,973 
SOFTWARE—Net14,224 13,978 
OPERATING LEASE RIGHT-OF-USE ASSETS22,591 23,437 
INTANGIBLE ASSETS—Net9,162 10,194 
GOODWILL29,438 29,438 
OTHER ASSETS3,359 3,519 
TOTAL ASSETS$1,146,871 $1,193,908 
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable$51,108 $36,587 
Accrued expenses15,409 16,904 
Accrued compensation and benefits44,735 57,594 
Operating lease liabilities—current4,764 4,709 
Current portion of long-term debt43,290 45,854 
Contract liabilities2,952 8,066 
Other current liabilities4,487 4,873 
Total current liabilities166,745 174,587 
LONG-TERM DEBT, NET—less current portion637,155 637,480 
DEFERRED INCOME TAXES46,018 37,478 
OPERATING LEASE LIABILITIES24,560 25,685 
OTHER LIABILITIES2,954 1,877 
Total liabilities877,432 877,107 
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value1,715 1,694 
Additional paid-in capital580,712 580,764 
Accumulated deficit(314,315)(269,769)
Accumulated other comprehensive income1,327 4,112 
Total shareholders’ equity269,439 316,801 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$1,146,871 $1,193,908 


SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited)
(In thousands)
Three Months Ended September 30,
20242023
REVENUE:
Commissions and other services
$139,380 $137,942 
Pharmacy152,883 94,788 
Total revenue292,263 232,730 
OPERATING COSTS AND EXPENSES:
Cost of commissions and other services revenue
65,733 72,511 
Cost of goods sold—pharmacy revenue129,524 84,008 
Marketing and advertising63,764 62,323 
Selling, general, and administrative36,145 28,666 
Technical development9,074 7,637 
Total operating costs and expenses304,240 255,145 
LOSS FROM OPERATIONS(11,977)(22,415)
INTEREST EXPENSE, NET(23,031)(21,397)
OTHER EXPENSE, NET(12)(38)
LOSS BEFORE INCOME TAX EXPENSE (BENEFIT)
(35,020)(43,850)
INCOME TAX EXPENSE (BENEFIT)
9,526 (12,799)
NET LOSS$(44,546)$(31,051)
NET LOSS PER SHARE:
Basic$(0.26)$(0.19)
Diluted$(0.26)$(0.19)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic170,431 167,453 
Diluted170,431 167,453 
OTHER COMPREHENSIVE LOSS NET OF TAX:
Change in cash flow hedge
(2,785)(2,010)
OTHER COMPREHENSIVE LOSS
(2,785)(2,010)
COMPREHENSIVE LOSS$(47,331)$(33,061)


SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)

Three Months Ended September 30,
20242023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$(44,546)$(31,051)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
— 
Depreciation and amortization5,599 5,989 
Loss on disposal of property, equipment, and software68 9 
Share-based compensation expense3,846 3,175 
Deferred income taxes9,526 (13,049)
Amortization of debt issuance costs and debt discount1,064 1,612 
Accrued interest payable in kind5,289 3,622 
Non-cash lease expense903 784 
Changes in operating assets and liabilities:
Accounts receivable, net50,501 38,693 
Commissions receivable(38,466)(29,148)
Other assets(3,516)(2,027)
Accounts payable and accrued expenses12,761 5,257 
Operating lease liabilities(1,127)(1,498)
Other liabilities(18,512)(6,039)
Net cash used in operating activities(16,610)(23,671)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment(442)(616)
Proceeds from sales of property and equipment— 253 
Purchases of software and capitalized software development costs(2,132)(1,782)
Net cash used in investing activities(2,574)(2,145)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on Term Loans(8,471)(8,471)
Payments on other debt(30)(37)
Proceeds from common stock options exercised and employee stock purchase plan38 — 
Payments of tax withholdings related to net share settlement of equity awards(3,915)(346)
Payments of debt issuance costs(684)— 
Net cash used in financing activities
(13,062)(8,854)
NET DECREASE IN CASH AND CASH EQUIVALENTS(32,246)(34,670)
CASH AND CASH EQUIVALENTS—Beginning of period42,690 83,156 
CASH AND CASH EQUIVALENTS—End of period$10,444 $48,486 



SELECTQUOTE, INC. AND SUBSIDIARIES
Adjusted EBITDA to Loss before income tax expense (benefit) Reconciliation
(Unaudited)

Three Months Ended September 30, 2024
(in thousands)SeniorHealthcare ServicesLife
Total
Adjusted Segment EBITDA
$7,724 $4,878 $5,960 $18,562 
All other Adjusted EBITDA
3,797 
Corporate & elimination of intersegment profits(24,042)
Adjusted EBITDA
(1,683)
Share-based compensation expense(3,846)
Transaction costs (1)
(826)
Depreciation and amortization(5,599)
Loss on disposal of property, equipment, and software, net(35)
Interest expense, net(23,031)
Loss before income tax expense (benefit)$(35,020)

Three Months Ended September 30, 2023
(in thousands)SeniorHealthcare ServicesLife
Total
Adjusted Segment EBITDA$(1,335)$2,322 $5,240 $6,227 
All other Adjusted EBITDA3,319 
Corporate & elimination of intersegment profits(20,922)
Adjusted EBITDA
(11,376)
Share-based compensation expense(3,175)
Transaction costs (1)(1,904)
Depreciation and amortization(5,989)
Loss on disposal of property, equipment, and software(9)
Interest expense, net(21,397)
Loss before income tax expense (benefit)
$(43,850)










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)
$(59,000)$3,000 
Income tax expense
13,000 1,000 
Interest expense, net100,000 90,000 
Depreciation and amortization24,000 20,000 
Share-based compensation expense16,000 13,000 
Transaction costs6,000 3,000 
Adjusted EBITDA$100,000 $130,000 




| We shop. You save. 1st Quarter Fiscal 2025 Earnings Conference Call Presentation November 4, 2024 Exhibit 99.2

 
| We shop. You save. Forward-Looking Statements This presentation 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: impacts of the COVID-19 pandemic and any other significant public health events; 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; our ability to regain and maintain compliance with NYSE listing standards; 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 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. Certain information contained in this presentation and statements made orally during this presentation relate to or are based on publications and other data obtained from third-party sources. While we believe these third-party sources to be reliable as of the date of this presentation, we have not independently verified, and make no representation as to the adequacy, fairness, accuracy or completeness of, any information obtained from such third-party sources. No Offer or Solicitation; Further Information This presentation is for informational purposes only and is not an offer to sell with respect to any securities. This presentation should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes thereto included in the Annual Report and subsequent quarterly reports. Non-GAAP Financial Measures This presentation 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 presentation Adjusted EBITDA, which is a non-GAAP financial measure. This non-GAAP financial measure is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to any similarly titled measure presented by other companies. We define Adjusted EBITDA as income (loss) before interest expense, income tax expense (benefit), depreciation and amortization, 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 net income (loss). We monitor and have presented in this presentation Adjusted EBITDA because it is a key measure used by our management and Board of Directors to understand and evaluate our operating performance, establish budgets, and 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. For further discussion regarding these non-GAAP measures, please see today’s press release. See below beginning on slide 14 for reconciliations of these non-GAAP financial measures to their most directly comparable GAAP measures. Disclaimer 2

 
| We shop. You save. • Senior ◦ Strong agent retention and high tenured agent mix heading into AEP ◦ Solid close rates and agent productivity in the first few weeks of AEP • Healthcare Services ◦ Positive Adjusted EBITDA* for a sixth consecutive quarter despite continued growth investment ◦ SelectRx ended 1Q with over 86k members representing growth of 64% year-over-year 1Q Earnings Highlights *See "Non-GAAP Financial Measures" section on slide 2 $ in millions 1Q25 1Q24 Revenue $292.3 $232.7 Adjusted EBITDA* $(1.7) $(11.4) Financial Results• Consolidated Company Highlights ◦ Delivered year-over-year revenue growth of 26% at a Rev to CAC of 4.6X ◦ Higher Adjusted EBITDA* year-over-year during traditional investment quarter ◦ Raising FY2025 guidance ranges for Revenue, Adjusted EBITDA* and Net Income 3

 
| We shop. You save. Significant initial call volume for both new and re-shop policyholders Efficient early volume per marketing dollar invested Agents Marketing CarriersTechnology AEP Readiness 4 Strong agent retention throughout 2023 and 2024 Entering AEP with the most tenured agent force in recent years Utilizing early carrier plan data to strategically deploy marketing investments Proactive outreach to existing customers Carrier data helped proactively prioritize beneficiaries Policy terminations and benefit curtailment elevated this year Healthy and stable close rates Strong agent productivity Preparation Initial Observations Expanded use of AI: • Call screening and prioritization • Call monitoring and quality assurance • Back-end automation Continue to leverage data and processing power to drive best returns on customer acquisition SelectQuote's unbiased agents and true choice model designed to serve consumers Model alignment with policyholder & carrier

 
| We shop. You save. Receivables Balance Securitized ProceedsTerm Debt Securitized Debt On October 15th, SelectQuote closed a $100M investment grade rated securitization transaction Sept'25 Previous term debt maturity Executing on Recapitalization Plan Extended Maturities Lower Cost of Capital Future Optionality 5 Sept'28 Term debt maturity after milestone payments are achieved Sept'27 Extended term debt maturity Annual interest rate savings of ~$5M Lays foundation for potential future warehouse financing and securitization deals 500+ bps} >14% <9% ~15% ~85% Not Pledged Pledged $100m

 
| We shop. You save. $688 $573** 5.9x*** 4.5x**** Term Debt Balance Term Debt to Adj EBITDA* 6/30/24 Post-Securitization Future State Initial Progress to Improve Capital Flexibility SelectQuote's model has delivered strong operating results over the past 11 quarters, but growth and profitability have been hindered by high leverage and cost of capital. Our top priority is to eliminate that headwind in fiscal 2025. 6 Priority to Improve Capital Flexibility *See "Non-GAAP Financial Measures" section on slide 2 **Excludes securitized (Non-Recourse) debt ***Based on LTM Adjusted EBITDA as of 6/30/24 ****Based on LTM Adjusted EBITDA as of 9/30/24 Target term debt leverage in the 2-3x EBITDA range 26% YoY Consolidated Revenue Growth 4.6x Enterprise Rev/CAC***** >90% Tenured Agent mix 86k SelectRx members at the conclusion of Q1 Operational Highlights *****The revenue to customer acquisition cost (“CAC”) multiple represents total revenue as a multiple of total marketing acquisition costs for the Senior and Healthcare Services divisions, which represents the direct costs of acquiring leads.

 
| We shop. You save. Revenue $MM Adjusted EBITDA* $MM $(11) $(2) 1Q24 1Q25 Consolidated Financial Summary $233 $292 1Q24 1Q25 *See "Non-GAAP Financial Measures" section on slide 2 7

 
| We shop. You save. Total Approved Policies 000s MA LTV SelectQuote Senior KPIs $761 $812 1Q24 1Q25 110 105 98 92 12 13 MA Other 1Q24 1Q25 8

 
| We shop. You save. Revenue $MM Adjusted EBITDA* $MM Senior Financial Summary $90 $93 1Q24 1Q25 $(1) $8 1Q24 1Q25 *See "Non-GAAP Financial Measures" section on slide 2 9

 
| We shop. You save. SELECTRX Members 1Q24 2Q24 3Q24 4Q24 1Q25 — 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 Revenue & Adjusted EBITDA* $MM 10 $2 $3 $2 $1 $5 $97 $112 $124 $145 $156 1Q24 2Q24 3Q24 4Q24 1Q25 Healthcare Services KPIs REVENUE ADJUSTED EBITDA* *See "Non-GAAP Financial Measures" above on slide 2.

 
| We shop. You save. $38 $39 1Q24 1Q25 $5 $6 1Q24 1Q25 Life Financial Summary 11 *See "Non-GAAP Financial Measures" section on slide 2 Revenue $MM Adjusted EBITDA* $MM 15%14%Margin %

 
| We shop. You save. Raising FY25 Financial Guidance REVENUE 12 +12% YoY At the Midpoint $1.425B ADJUSTED EBITDA** NET INCOME (LOSS) to $1.525B $100M to $130M $(59)M to $3M +(2)% YoY At the Midpoint +18% YoY At the Midpoint from $90 million to $120 million* from $(42) million to $(6) million* *Original FY25 Guidance provided on September 13, 2024 **See "Non-GAAP Financial Measures" above on slide 2. from $1.4 billion to $1.5 billion*

 
| We shop. You save. Supplemental Information 13

 
| We shop. You save. Adjusted EBITDA to Loss before income tax expense (benefit) Reconciliation 1Q FY 2025 (in thousands) Senior Healthcare Services Life Total Adjusted Segment EBITDA $ 7,724 $ 4,878 $ 5,960 $ 18,562 All other Adjusted EBITDA 3,797 Corporate & elimination of intersegment profits (24,042) Adjusted EBITDA (1,683) Share-based compensation expense (3,846) Transaction costs (826) Depreciation and amortization (5,599) Loss on disposal of property, equipment, and software, net (35) Interest expense, net (23,031) Loss before income tax expense (benefit) $ (35,020) 14 1Q FY 2024 (in thousands) Senior Healthcare Services Life Total Adjusted Segment EBITDA $ (1,335) $ 2,322 $ 5,240 $ 6,227 All other Adjusted EBITDA 3,319 Corporate & elimination of intersegment profits (20,922) Adjusted EBITDA (11,376) Share-based compensation expense (3,175) Transaction costs (1,904) Depreciation and amortization (5,989) Loss on disposal of property, equipment, and software, net (9) Interest expense, net (21,397) Loss before income tax expense (benefit) $ (43,850)

 
| We shop. You save. (in thousands) Range Net income (loss) $ (59,000) $ 3,000 Income tax expense $ 13,000 $ 1,000 Interest expense, net $ 100,000 $ 90,000 Depreciation and amortization $ 24,000 $ 20,000 Share-based compensation expense $ 16,000 $ 13,000 Transaction costs $ 6,000 $ 3,000 Adjusted EBITDA $ 100,000 $ 130,000 Net Income (Loss) to Adjusted EBITDA Reconciliation FY25 Guidance 15

 
| We shop. You save. SelectQuote Inc. 6800 West 115th Street Suite 2511 Overland Park, Kansas 66211 Phone: (877) 678-4086 Investor Relations investorrelations@selectquote.com 16

 
v3.24.3
Cover
Nov. 04, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Nov. 04, 2024
Entity Registrant Name SELECTQUOTE, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-39295
Entity Tax Identification Number 94-3339273
Entity Address, Address Line One 6800 West 115th Street
Entity Address, Address Line Two Suite 2511
Entity Address, City or Town Overland Park
Entity Address, State or Province KS
Entity Address, Postal Zip Code 66211
City Area Code 913
Local Phone Number 599-9225
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.01 par value
Trading Symbol SLQT
Security Exchange Name NYSE
Entity Emerging Growth Company false
Entity Central Index Key 0001794783
Amendment Flag false
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