Slide 1: 2nd Quarter Fiscal 2023 Earnings Conference Call Presentation
2nd Quarter Fiscal 2023 Earnings Conference Call Presentation February 7, 2023 | We shop. You save.
Slide 2: Disclaimer
Disclaimer 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 o
Slide 3: 2QFY23 Earnings Highlights
2QFY23 Earnings Highlights SelectQuote delivered strong 2Q results fueled by a strong Senior Medicare AEP season • 2Q Consolidated Revenue totaled $319.2 million, compared to $194.2 million last year • 2Q Consolidated Net Income totaled $23 million or $0.14 per diluted share • 2Q Consolidated Adjust
Slide 4: Strategic Redesign Progress and Leverage in AEP
Strategic Redesign Progress and Leverage in AEP Agent Close Rates 54% AEP BY THE NUMBERS YoY % 0 Tenured Agent Mix 70%+ Approval Rates (YoY) 11% 2Q22 3Q22 4Q22 1Q23 2Q23 Marketing Expense Per Policy* MA Policies (YoY) (18)% Senior Revenue (YoY) 52% YoY % 0 Senior Adj. (50)% 37% EBITDA Margin** 2Q22
Slide 5: Four Pillar Strategy
Four Pillar Strategy New MA Growth Mitigate Operational MA Lifetime Value Healthcare Services Philosophy Risk Factors (LTV) Planned pullback in Full AEP team hired, New business written SelectRx members Medicare Advantage trained and onboarded in since 2Q FY22 performing exceeded 39K as of 2Q polici
Slide 6: Senior Efficiency Metrics
Senior Efficiency Metrics OPERATING EXPENSES PER APPROVED POLICY* % OF TOTAL REVENUE RECEIVED IN FIRST YEAR $1,134 $1,076 64% $799 56% 54% $637 47% 2Q22 2Q23 LTM 12/31/21 LTM 12/31/22 2Q22 2Q23 LTM 12/31/21 LTM 12/31/22 *Represents Senior operating costs divided by approved MA/MS policies. | We shop
Slide 7: Senior Financial Summary
Senior Financial Summary REVENUE ADJUSTED EBITDA* $MM $MM $224 $84 $148 $(140) 2Q22 2Q23 2Q22 2Q23 *See "Non-GAAP Financial Measures" above on slide 2. | We shop. You save. 7
Slide 8: SelectQuote Senior KPI's
SelectQuote Senior KPI’s TOTAL POLICIES APPROVED ADJUSTED EBITDA MARGIN* MA LTV 000s 318 $922 53% $870 49% 52 41% 43% 37% 241 22 266 219 2Q22 2Q23 (48)% (95)% MA Other 2Q18 2Q19 2Q20 2Q21 2Q22 2Q23 2Q22 2Q23 *See "Non-GAAP Financial Measures" above on slide 2. | We shop. You save. 8
Slide 9: MA LTV Bridge
MA LTV Bridge Strategic decisions prioritize performance stability and cash returns • Strategic Decision Making Strategic Decision Market Dynamics ◦ Carrier Mix: lower LTVs but shift Making toward historically higher retention carriers $922 ◦ Carrier Direct Mix: lower LTV policies that are more cash
Slide 10: Senior Policy Payback Period Timing
Senior Policy Payback Period Timing Remaining Renewals Remaining Fixed Renewals 2nd Renewal 2nd Renewal Direct Fixed Variable 1st Renewal 1st Renewal Direct Variable Variable First Year First Year Marketing Cash Cash Variable Marketing Cost Revenue Cost Revenue LTM Ending 12/31/2021 LTM Ending 12/31
Slide 11: Healthcare Services
Healthcare Services SELECTRX MEMBERS REVENUE & ADJUSTED EBITDA* 45,000 $MM 40,000 35,000 $55 30,000 $43 $30 $23 25,000 $11 20,000 2Q22 3Q22 4Q22 1Q23 2Q23 15,000 10,000 $(8) $(8) $(9) $(12) $(12) 5,000 — 2Q22 3Q22 4Q22 1Q23 2Q23 *See "Non-GAAP Financial Measures" above on slide 2. | We shop. You sav
Slide 12: Life and Auto & Home
Life and Auto & Home REVENUE ADJUSTED EBITDA* $MM $MM $8 $6 $2 $32 $34 $6 $1 $1 2Q22 2Q23 2Q22 2Q23 Life Auto & Home Life Auto & Home *See "Non-GAAP Financial Measures" above on slide 2. | We shop. You save. 12
Slide 13: Fiscal Full Year 2023 Guidance
Fiscal Full Year 2023 Guidance (#039;s in millions) Range Implied YoY Growth Revenue $910 - $960 19% - 26% Net Loss $94 - $78 NM - NM Adjusted EBITDA* $5 - $25 NM - NM *See "Non-GAAP Financial Measures" above on slide 2. | We shop. You save. 13
Slide 14: Supplemental Information
Supplemental Information | We shop. You save. 14
Slide 15: Net Income (Loss) to Adjusted EBITDA Reconciliation
Net Income (Loss) to Adjusted EBITDA Reconciliation 2Q FY 2023 Healthcare (in thousands) Senior Services Life Auto & Home Corp & Elims Consolidated Revenue $ 223,826 $ 55,480 $ 33,995 $ 7,808 $ (1,921) $ 319,188 Operating expenses (140,209) (64,781) (28,152) (5,524) (16,877) (1) (255,543) Other inco
Slide 16: Net Loss to Adjusted EBITDA Reconciliation (FY23 Guidance)
Net Loss to Adjusted EBITDA Reconciliation (FY23 Guidance) (in thousands) Range Net loss $ (94,000) $ (78,000) Income tax benefit (27,000) (25,000) Interest expense, net 74,000 74,000 Depreciation and amortization 24,000 24,000 Share-based compensation expense 12,000 12,000 Transaction costs 16,000
Slide 17: SelectQuote Inc. Contact and Investor Relations
SelectQuote Inc. 6800 West 115th Street Suite 2511 Overland Park, Kansas 66211 Phone: (913) 599-9225 Investor Relations investorrelations@selectquote.com | We shop. You save. 17