Healthequity, Inc. · NASDAQ:HQY
Healthequity — JP Morgan Healthcare Conference 2017
20 slides from Healthequity's conference presentation, January 2017
Slide 1: JP Morgan Healthcare Conference Investor Presentation
JP Morgan Healthcare Conference Investor Presentation January 2017 Copyright © 2015 HealthEquity, Inc. All rights reserved. HealthEquity and the HealthEquity logo are registered trademarks and service marks of HealthEquity, Inc. Confidential and proprietary. Reproduction without express written cons
Slide 2: Notice and disclaimer
Notice and disclaimer This presentation does not constitute an offer or invitation for the sale or purchase of securities and has been prepared solely for informational purposes. This presentation is a summary of information contained in our public filings filed with the Securities and Exchange Comm
Slide 3: Legal disclaimers
Legal disclaimers HealthEquity Advisors, LLC is a separate, wholly-owned subsidiary of HealthEquity. Investments available to HSA holders are subject to risk, including the possible loss of the principal invested and are not FDIC insured or guaranteed by HealthEquity, Inc.. HealthEquity, Inc. does n
Slide 4: Investment highlights
Investment highlights Momentum Innovation Rapid growth Vast ecosystem in customers, revenue, profit of 3rd-party solutions enabled and lead over competitors by HQY’s technology An independent, trusted platform used by millions of consumers Opportunity to build health savings Leadership Powerful tren
Slide 5: Key financial metrics
Key financial metrics Revenue ($M) 44% $126.8 $43.4 $87.9 $30.6 $62.0 42% 42% FY16 Q3 FY17 Q3 FY14 FY15 FY16 Adjusted EBITDA ($M) $40.6 61% $14.5 $25.2 $9.9 $15.8 60% 47% FY16 Q3 FY17 Q3 FY14 FY15 FY16 HSA Members (000s) 2,378 2,141 1,602 48% 50% 1,427 968 47% FY16 Q3 FY17 Q3 FY14 FY15 FY16 AUM ($M)
Slide 6: Our core – health savings accounts
Our core – health savings accounts $2,266 Average premium savings* $6,750 $1,617 Maximum contribution to HSA Average employer contribution** For consumers For HealthEquity Triple tax savings Engaged consumers Lower premiums Sticky relationships Fully portable Diverse revenue Same annual out-of-pocke
Slide 7: Expanding market
Expanding market 14% Penetration of HSA +20% CAGR Market Growth* plans among under-65, privately insured* *Devenir Midyear HSA Report 6/30/2016 ** Management estimate 7
Slide 8: Competition: 2016 midyear estimates
(1) Competition: 2016 midyear estimates AUM 1-year HSAs 1-year $ billion growth 000’s growth (2) UNH 6.776 37% 2,896 32% WBS 4.930 15% 2,012 20% HQY 4.201 60% 2,300 50% XRX/BK 2.724 47% 2,230 42% BAC 1.743 29% 729 33% Top 20 total 27.710 27% 13,569 27% (1) SOURCE: Devenir Research, 2016 Midyear HSA
Slide 9: HealthEquity difference
HealthEquity difference NOTE: Data as of December 31, 2016 except for Network partners data as of January 1, 2017 9
Slide 10: Advanced functionality and mobility
Advanced functionality and mobility 10
Slide 11: B2B2C
B2B2C Network 584 87 >1/3 Growth in HSA members partners Large employers Health plans Of Americans under 65 are covered by HQY 47% 50% network partners* FY 15 FY 16 Health plan and broker sales, account execs Share from existing partners 77% 87% FY 15 FY 16 34K+ Employers Unit acquisition cost ** $2
Slide 12: Value of mature accounts
Value of mature accounts The average HealthEquity HSA All HSAs 5+ year HSAs Investors Average cash balance $1,532 $5,444 Average investment balance $189 $14,217 Total AUM balance $1,721 $19,661 >10x growth opportunity Source: HealthEquity data as of January 31, 2016 12
Slide 13: Early innings
Early innings Expand Grow market ecosystems Consolidate Increase market Penetrate yield Add new network partners Monetize core Expand opportunity Tailwinds Leverage Scale 13
Slide 14: Seeds of future growth
Seeds of future growth 57% Of HSAs are new to HQY platform $1,721 Average account balance 98% Of HSA members yet to invest < 10% Penetration of network partners Low Interest rate environment > 97% Retention rate for FY2016 FY 2016 data 14
Slide 15: 3rd quarter operating results
3rd quarter operating results HSAs (000s) AUM ($M) Net new HSAs Cash AUM Investment AUM $4,284 2,378 $571 776 1,602 $2,693 $385 493 $1,836 1,109 $3,713 $257 349 1,602 $2,308 1,109 $1,579 760 FY15 Q3 FY16 Q3 FY17 Q3 FY15 Q3 FY16 Q3 FY17 Q3 • Net increase of 776K YoY • Net increase of $1.4B YoY - 195K
Slide 16: 3rd quarter financial results
3rd quarter financial results (1) Revenue ($M) Adjusted EBITDA ($M) Three Months Nine Months Three Months Nine Months $131.6 $51.0 $90.9 $43.4 $14.5 $31.8 $63.0 $9.9 $30.6 $6.1 $21.9 $19.7 FY15 FY16 FY17 FY15 FY16 FY17 FY15 FY16 FY17 FY15 FY16 FY17 • 45% YTD revenue growth YoY • 60% YTD Adjusted EBI
Slide 17: Capitalization
Capitalization ($ in millions) October 31, 2016 January 31, 2016 Cash, cash equivalents & $165.7 $123.8 marketable securities Long-term debt $0.0 $0.0 ($100M available LOC) Total equity $252.6 $203.5 NOTE: For more information, see our public filings with the Securities and Exchange Commission. 17
Slide 18: Guidance
Guidance For the Fiscal Year Ending January 31, 2017 Guidance as of December 6, 2016 ($ in millions, except per share) Revenue $174 – $178 Net Income $23 - $25 Earnings per diluted share $0.38 - $0.42 Adjusted EBITDA** $59 – $62 *Guidance issued in earnings press release on December 6, 2016. We do n
Slide 19: Powerful monetization
Powerful monetization Gross margin 57% 68% 72% FY 16 overall 3-year old HSA 6-year old HSA Investing 10x HSA balance of Payments mature accounts Balance investing Account growth opening HQY data as of January 31, 2016 19
Slide 20: HealthEquity: Building Health Savings
HealthEquity: Building Health Savings”