Healthequity, Inc. · NASDAQ:HQY
Healthequity — Cantor Global Healthcare Conference 2021
19 slides from Healthequity's conference presentation, September 2021
Slide 1: Cantor Healthcare Conference Investor presentation
Cantor Healthcare Conference Investor presentation September 2021 Copyright © 2021 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 is a summary of information contained in our public filings filed with the Securities and Exchange Commission (SE
Slide 3: An industry leader
An industry leader 13.1M 100K Total Accounts Employer Clients 6.0M 174 HSA members Network partners $15.5B 15K HSA assets Integrations NOTE: HealthEquity Employer Clients, Network Partners and Integration metrics as of January 31, 2021. 3 Total Accounts, HSA Members and HSA Assets metrics as of July
Slide 4: Expanding market
Expanding market 1 Devenir HSA Research Report as of December 31, 2020 2 Management estimate as of September 2021 4 3 HealthEquity information as of July 31, 2021 4 Proprietary research June 2019
Slide 5: Multiple avenues for growth
Multiple avenues for growth New partners Cross-sell Uptake & M&A initiatives & clients balance growth Rate recovery, return to work and regulatory tailwinds 5
Slide 6: Win new network partners and clients
Win new network partners and clients Network partners 174 165 2 Advisors and brokers 174 141 5 #1 Mind share FY19 FY20 FY21 Health plan partners cover How Network Partners 2 employers ~50% find their HSA of commercially insured 35% Direct sales to partner1 3 25% ~100K Clients that employ 1 in 7 work
Slide 7: Lean into cross-sell
Lean into cross-sell Health plan Managed All others3 partners 1 clients 2 HealthEquity data as of January 2021 1 – Largest 50 HealthEquity health plan partners 7 2 – Largest 5K HealthEquity managed employer clients 3 – All other HealthEquity partners and clients estimated
Slide 8: Increase uptake
Increase uptake Engagement platform Virtual open enrollment Live specialists Just 24% of those with commercial health insurance have HSA-qualified plans 1 8 1 – Kaiser Family Foundation 2020 Survey report - October 2020
Slide 9: Grow balances
Grow balances HSA average balance growth HSA investors FY2021 Average HSA member balance Non-investing member $2,600 YoY growth of average member balance $2,479 16% Investing member $2,400 14% $2,200 $2,160 15% 12% $2,027 10% $2,000 8% $1,800 6% $1,600 7% 2% 4% $1,400 2% HSAs Assets $1,200 0% FY19 F
Slide 10: M&A initiatives
M&A initiatives Custodial consolidation1 Additional solutions HSA Provider Market Share Company 1 20% 16% ✓ Proven track record Company 3 12% Company 4 11% ✓ Disciplined approach Company 5 5% #9 Further 2% ✓ Integration playbook #14 Fifth Third Bank 1% Top 10 80% ✓ Go-to-market focus All Others 20%
Slide 11: Luum
Luum Return to work solution ▪ Beyond monthly passes ▪ Flexible platform (pc /mobile access) ▪ Strong partnerships and client base ▪ Sustainable business model 11
Slide 12: Headwinds becoming tailwinds
Headwinds becoming tailwinds Rate improvement Return to work Regulatory ▪ Custodial mix shift to ▪ Deferred client pipeline ▪ COBRA subsidy annuity products with higher ▪ Employment rebound ▪ HSA expansion yields than bank deposits ▪ Commuter utilization ▪ Medicare opportunities ▪ Balances continuin
Slide 13: Foundation of promises kept
Foundation of promises kept 42% 5-yr revenue CAGR 1 29 Beating adjusted Consecutive QUARTERS 43% 5-yr Adjusted EBITDA +10yrs Increased market EBITDA consensus 2 CAGR 1 share 3 Growth Visibility Profitable Sustainable 1- HealthEquity data based on changes from fiscal years 2016 to 2021 13 2- Based on
Slide 14: HSA key metrics
HSA key metrics HSAs (000s) HSA Assets ($M) Total Accounts Net new HSAs Invested assets Acq HSAs Beg HSAs 5,972 Cash assets $15,471 HSA 5,384 588 $12,211 6.0M 464 $5,443 4,163 757 $8,516 $3,241 FSA 3.1M 589 $2,056 5,384 3,574 4,163 $8,970 $10,028 HRA $6,460 1.8M Q2FY20 Q2FY21 Q2FY22 Q2FY20 Q2FY21 Q2
Slide 15: Fiscal second quarter financial results
Fiscal second quarter financial results (1) Revenue ($M) Adjusted EBITDA ($M) Three Months Six Months Three Months Six Months $373.3 $123.0 $124.5 $366.0 $65.5 $79.6 $189.1 $60.0 $176.0 $173.7 $40.6 $86.6 FY20 FY21 FY22 FY20 FY21 FY22 FY20 FY21 FY22 FY20 FY21 FY22 • 7% Q2 revenue growth YoY • 9% Adj
Slide 16: Capitalization and leverage
Capitalization and leverage ($ in millions) July 31, 2021 January 31, 2021 Cash, cash equivalents $754 $329 & marketable securities Long-term debt, net of debt issuance costs $974 $987 ($350M available LOC) Total stockholders’ equity $1,863 $1,379 Refinancing of debt Sources of funds ($ in millions)
Slide 17: Key benefits
Key benefits Before: After: ◼ Provides significant tenor Term loan 1 Term loan Unsecured notes extension with the revolver 769 Tenor 500 and term loan now maturing 271 70 102 in 2026 and the new notes 47 2 11 18 20 28 maturing in 2029 '22 '23 '24 '25 '26 '27 '28 '29 '30 '22 '23 '24 '25 '26 '27 '28 '
Slide 18: Guidance
Guidance Business outlook HealthEquity fiscal year ending January 31, 2022 September 8, 2021* June 7, 2021 March 15, 2021 $755 - $765 $755 - $765 $750 - $760 $122 - $126 $122 - $126 $115 - $119 $1.45 - $1.50 $1.45 - $1.50 $1.37 - $1.42 $241 - $247 $241 - $247 $240 - $246 *Guidance issued in press re
Slide 19: HealthEquity
HealthEquity:
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