Healthequity, Inc. · NASDAQ:HQY
Healthequity — JPMorgan 2024 Healthcare Conference
21 slides from Healthequity's conference presentation, January 2024
Slide 1: JPMorgan 2024 Healthcare Conference Investor Presentation
JPMorgan 2024 Healthcare Conference Investor Presentation January 2024 Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal, tax or financial advice.
Slide 2: Safe harbor
Safe harbor 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 includes a summary of certain information contained in our public filings filed with the Securities and Exchange
Slide 3: FYE24 outlook key metrics
FYE24 outlook ~8.7M HSAs +9%YoY ~$24.5B HSA assets +11%YoY ~15.6M ~900k ~$2.4B HSA asset growth 200+ #1 HSA administrator Total accounts +5%YoY new HSA Network partners HealthEquity key metrics estimated for fiscal year ending January 31, 2024, except Devenir ranking is as of the Devenir June 30, 20
Slide 4: Leading the growth of health savings
Total HSA assets HQY HSA assets Leading the growth of health savings… 2010 Present Future Total HSAs ~6 million ~35 million ~50 million Total HSA assets ~$10B assets; 9% invested ~$120B assets; 36% invested ~$300B assets; 50%+ invested Total HSA + CDB revenue ~$2 billion ~$5 billion+ ~$10 billion+ H
Slide 5: Through an intelligent connected benefits ecosystem
Third party administrators Health plan partners Through an intelligent Brokers connected benefits Consultants ecosystem Members Powered by proprietary technology and deep integration capabilities, HealthEquity and our partners deliver unique value to members and clients Providers Benefit administrat
Slide 6: Remarkable experience
Frictionless Instant Digital Smart 72% first-chat Claim approval multi-product savings solutions Remarkable resolution in <1 min (beta) chip card (coming in FY25) experience Enabled by ecosystem data connectivity + predictive technologies Copyright © 2024 HealthEquity, Inc. All rights reserved. | He
Slide 7: Propels all facets of shared customer growth
Propels all facets of shared customer growth >40,000 Clients FY24 HSA sales from new HealthEquity Blues Partner Summit partnerships Members June 2023 Savings Shared customer objectives 3 out of 4 FY24 new sales ▪ Engagement with integrated ▪ Retention partnerships ▪ Growth Copyright © 2024 HealthEqu
Slide 8: Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal,
Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal, tax or financial advice. 8
Slide 9: HSA key metrics
HSA key metrics HSAs (000s) HSA Assets ($M) Total Accounts (000s) Net new HSA sales Invested assets Acq HSAs Cash assets HSA 8.3M Beg HSAs $22,568 8,295 7,650 645 $20,204 FSA 3.1M 739 6,241 $16,428 $8,597 670 621 $7,108 HRA 2.1M 160 $5,959 7,650 COBRA 0.5M 6,241 5,460 $13,096 $13,971 $10,469 Commute
Slide 10: Fiscal third quarter financial results
Fiscal third quarter financial results Revenue ($M) Adjusted EBITDA(1) ($M) Three Months Nine Months Three Months Nine Months $270.3 $737.2 $627.9 $198.7 $185.6 $553.3 $249.2 $216.1 $95.6 $180.0 $61.1 $73.4 FY22 FY23 FY24 FY22 FY23 FY24 FY22 FY23 FY24 FY22 FY23 FY24 15% Q3FY24 growth YoY 30% adjuste
Slide 11: Fiscal year 2024 guidance
Fiscal year 2024 guidance HealthEquity fiscal year ending January 31, 2024 Guidance as of: December 5, 2023 September 5, 2023 June 5, 2023 March 21, 2023 ($ in millions, except per share) Revenue $985 - $995 $980 - $990 $975 - $985 $960 - $975 Net Income $34 - $39 $19 - $24 $9 - $14 $0 - $11 Net inc
Slide 12: Fiscal year 2025 outlook
Fiscal year 2025 outlook HealthEquity fiscal year ending January 31, 2025 Outlook as of: December 5, 2023* Revenue ($ in millions) $1,140 - $1,160 Adjusted EBITDA (as a % of revenue) 38% - 39% Outlook based on HSA cash yield of approximately 3.0% *A reconciliation of our Adjusted EBITDA outlook for
Slide 13: Custodial yield - a multi-year tailwind
Custodial yield - a multi-year tailwind ▪ Maturity and repricing of low yielding contracts Treasury 5 year yield CD Jumbo 5 year average yield HQY HSA cash yield ▪ Favorable interest rate forward curve ▪ Continued mix shift to Enhanced Rates ▪ ~5-year laddered approach reduces volatility, enables HQ
Slide 14: HSA cash maturity schedule
HSA cash maturity schedule HSA cash custodial assets repricing in $billions ▪ $13.5 billion in fixed-rate $5.0 contracts as of Oct 31, 2023 ▪ $14.0 billion HSA cash less $0.5 billion in floating-rate contracts $3.3 ▪ Does not include subsequent $3.0 growth in HSA cash ▪ Q4 organic growth or transfer
Slide 15: Accelerating cash flow $470M+
Accelerating cash flow $470M+ Net cash flows provided by operating activities FY21 – FY23 ~$166M FY24 Q3 YTD net cash flows provided by operating activities BenefitWallet acquisition expected to increase leverage short-term but increasing cash flow will allow us to deleverage quickly ▪ Growing reven
Slide 16: Capital structure
Capital structure Capital allocation considerations October 31, January 31, ($ in millions) 2023 2023 Organic growth Cash, cash equivalents $334 $254 & marketable securities Portfolio M&A Long-term debt, net of debt issuance costs $874 $925 ($1B available LOC) Return of capital Debt to Adjusted 1.6x
Slide 17: HealthEquity Investor Day
HealthEquity Investor Day February 22 | HealthEquity Headquarters, Draper UT Register now Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal, tax or financial advice. 17
Slide 18: Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal,
Copyright © 2024 HealthEquity, Inc. All rights reserved. | HealthEquity does not provide legal, tax or financial advice. 18
Slide 19: GAAP to non-GAAP reconciliations for reported results
GAAP to non-GAAP reconciliations for reported results Three months ended October 31, Nine months ended October 31, (in thousands) 2023 2022 2021 2023 2022 2021 Net income (loss) 14,673 (1,641) (5,038) 29,348 (25,934) (11,471) Interest income (3,713) (443) (478) (7,795) (584) (1,419) Interest expense
Slide 20: GAAP to non-GAAP reconciliations for fiscal 2024 guidance
GAAP to non-GAAP reconciliations for fiscal 2024 guidance Outlook for the year ending Outlook for the year January 31, 2024 ending January 31, 2024 (in millions) (in millions, except per share data) Net income $34 - 39 Net income $34 - 39 Interest income (12) Income tax provision 19 - 24 Interest ex
Slide 21: HealthEquity
HealthEquity: