EX-99.1 2 selectquoteincjune302023pr.htm EX-99.1 Document
Exhibit 99.1
SelectQuote, Inc. Reports Fourth Quarter of Fiscal Year 2023 Results

Fourth Quarter of Fiscal Year 2023 – Consolidated Earnings Highlights

•Revenue of $221.8 million
•Net loss of $(47.8) million
•Adjusted EBITDA* of $(5.8) million

Fiscal Year 2024 Guidance Ranges:

•Revenue expected in a range of $1.05 billion to $1.2 billion
•Net loss expected in a range of $50 million to $22 million
•Adjusted EBITDA* expected in a range of $80 million to $105 million

Fourth Quarter Fiscal Year 2023 – Segment Highlights

Senior
•Revenue of $103.6 million
•Adjusted EBITDA* of $16.1 million
•Approved Medicare Advantage policies of 110,027

Healthcare Services
•Revenue of $82.8 million
•Adjusted EBITDA* of $1.7 million
•Approximately 49,000 SelectRx members

Life
•Revenue of $38.1 million
•Adjusted EBITDA* of $6.7 million

Auto & Home
•Revenue of $(1.3) million
•Adjusted EBITDA* of $(7.2) million
•Excluding the $10.4 million(1) change in estimate, Revenue of $9.2 million
•Excluding the $10.4 million(1) change in estimate, Adjusted EBITDA* of $3.2 million

OVERLAND PARK, Kan., September 13, 2023--(BUSINESS WIRE)--SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the fourth quarter of fiscal year 2023 of $221.8 million compared to consolidated revenue for the fourth quarter of fiscal year 2022 of $139.4 million. Consolidated net loss for the fourth quarter of fiscal year 2023 was $47.8 million compared to consolidated net loss for the fourth quarter of fiscal year 2022 of $104.7 million. Finally, consolidated Adjusted EBITDA* for the fourth quarter of fiscal year 2023 was $(5.8) million compared to consolidated Adjusted EBITDA* for the fourth quarter of fiscal year 2022 of $(60.8) million.

Consolidated revenue for the fiscal year ended June 30, 2023, was $1.0 billion compared to consolidated revenue for the fiscal year ended June 30, 2022, of $764.0 million. Consolidated net loss for the fiscal year ended June 30, 2023, was $58.5 million compared to consolidated net loss for the fiscal year ended June 30, 2022, of $297.5 million. Finally, consolidated Adjusted EBITDA* for the fiscal year ended June 30, 2023, was $74.3 million compared to consolidated Adjusted EBITDA* of $(260.5) million for the fiscal year ended June 30, 2022.

SelectQuote Chief Executive Officer, Tim Danker, remarked, “SelectQuote completed a highly successful fiscal 2023 with another strong quarter of results across each of our businesses. In total, our full year results significantly surpassed our initial forecasts driven by both higher growth, but most importantly, with outstanding operational execution against our paramount goal to optimize profitability and cash flow. The most stark example is nearly $80 million of outperformance in full-year Adjusted EBITDA versus our initial guidance. Similarly, excluding our investment in the growth of SelectRx, the SelectQuote model would have produced positive operating cash flow for the year, which we plan to scale in the quarters and years ahead.”

* See “Non-GAAP Financial Measures” below.
1) $10.4 million change in estimate related to the mutual termination of a contract with a certain Auto & Home carrier to provide for the ability to migrate the book of business to other carriers.

Mr. Danker continued, “Looking toward the future, our teams are excited to leverage our strategic redesign across each of our businesses, and we believe there is significant opportunity in our Healthcare Services segment. We can, and will, reproduce the success we have achieved in SelectRx with additional value-add services needed by seniors, healthcare providers, and our insurance carrier partners. We believe strongly that SelectQuote is unique in our ability to provide and optimize these services given the information and the leverage we can create via our role as the connective tissue between those in need and the providers of care and coverage. To say it more directly, SelectQuote is not just a Medicare Advantage distribution company, and we plan to decisively demonstrate that through our results in the coming years.”

Segment Results

We currently report on four segments: 1) Senior, 2) Healthcare Services, 3) Life, and 4) Auto & Home. The performance measures of the segments include total revenue and Adjusted EBITDA.* Costs of 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 calculated as total revenue for the applicable segment less direct and allocated costs of revenue, cost of goods sold, marketing and advertising, technical development, and selling, general, and administrative operating costs and expenses, excluding depreciation and amortization expense; gain or loss on disposal of property, equipment, and software; share-based compensation expense; and non-recurring expenses such as severance payments and transaction costs. 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)4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Revenue$103,592 $68,452 51 %$590,131 $527,907 12 %
Adjusted EBITDA*16,147 (32,574)150 %155,077 (161,702)196 %
Adjusted EBITDA Margin*16 %(48)%26%(31)%

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:











*See “Non-GAAP Financial Measures” below.
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4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Medicare Advantage114,383129,289(12)%652,630808,116(19)%
Medicare Supplement539890(39)%3,4447,208(52)%
Dental, Vision and Hearing14,66823,502(38)%74,181145,716(49)%
Prescription Drug Plan351649(46)%2,4336,842(64)%
Other2,0993,340(37)%7,50114,776(49)%
Total132,040157,670(16)%740,189982,658(25)%

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.

The following table shows the number of approved policies for the periods presented:

4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Medicare Advantage110,027115,707(5)%577,567661,738(13)%
Medicare Supplement435807(46)%2,6195,461(52)%
Dental, Vision and Hearing12,88423,738(46)%60,824124,989(51)%
Prescription Drug Plan350809(57)%2,1446,124(65)%
Other1,3563,208(58)%5,28812,407(57)%
Total125,052144,269(13)%648,442810,719(20)%

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):4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Medicare Advantage$830 $877 (5)%$877 $925 (5)%
Medicare Supplement1,2071,236(2)%1,0301,270(19)%
Dental, Vision and Hearing121122(1)%100123(19)%
Prescription Drug Plan185225(18)%207234(12)%
Other1056464 %1017338 %

Healthcare Services

Financial Results

The following table provides the financial results for the Healthcare Services segment for the periods presented:

(in thousands)4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Revenue$82,803 $30,036 176 %$252,075 $70,035 260 %
Adjusted EBITDA*1,685 (11,800)114 %(22,769)(32,097)29 %
Adjusted EBITDA Margin*2 %(39)%(9)%(46)%

*See “Non-GAAP Financial Measures” below.
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Operating Metrics

Members

The total number of SelectRx members represents the amount of active customers to which an order has been shipped, as this is the primary key driver of revenue for Healthcare Services.

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

June 30, 2023June 30, 2022
Total SelectRx Members49,04425,503

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.









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Twelve Months Ended June 30,
(dollars per approved policy):20232022
MA and MS approved policies580,186 667,199 
MA and MS commission per MA / MS policy$877 $928 
Other commission per MA/MS policy12 27 
Pharmacy revenue per MA/MS policy413 89 
Other revenue per MA/MS policy149 (147)
Total revenue per MA / MS policy1,451 897 
Total operating expenses per MA / MS policy(1,224)(1,187)
Adjusted EBITDA per MA/MS policy *$227 $(290)
Adjusted EBITDA Margin per MA/MS policy *16 %(32)%
Revenue / CAC multiple 4.1X  1.7X

Total revenue per MA/MS policy increased 62% for the twelve months ended June 30, 2023 compared to the twelve months ended June 30, 2022, primarily due to the increase in pharmacy revenue. Total operating expenses per MA/MS policy increased 3% for the twelve months ended June 30, 2023 compared to the twelve months ended June 30, 2022, driven by an increase in cost of goods sold-pharmacy revenue for Healthcare Services due to the growth of the business, offset by a decrease in our marketing and advertising costs.

Life

Financial Results

The following table provides the financial results for the Life segment for the periods presented:

(in thousands)4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Revenue$38,052 $37,331 2 %$145,832 $153,973 (5)%
Adjusted EBITDA*6,702 576 1064 %23,073 (129)NM
Adjusted EBITDA Margin*18 %2 %16%—%

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.



















*See “Non-GAAP Financial Measures” below.
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The following table shows term and final expense premiums for the periods presented:

(in thousands)4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Term Premiums$20,507 $16,374 25 %$68,941 $62,364 11 %
Final Expense Premiums18,960 25,500 (26)%77,725 109,218 (29)%
Total$39,467 $41,874 (6)%$146,666 $171,582 (15)%

Auto & Home

Financial Results

The following table provides the financial results for the Auto & Home segment for the periods presented:

(in thousands)4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Revenue$(1,266)(1)$7,126 (118)%$21,862 (1)$27,881 (22)%
Adjusted EBITDA*(7,235)(1)1,476 (590)%81 (1)5,433 (99)%
Adjusted EBITDA Margin*NM21 %— %19 %
(1) Decrease is due to the impact of the $10.4 million change in estimate related to the mutual termination of a contract with a certain Auto & Home carrier to provide for the ability to migrate the book of business to other carriers.

Operating Metrics

Auto & Home premium represents the total premium value of all new policies that were approved by our insurance carrier partners 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 Auto & Home segment.

The following table shows premiums for the periods presented:

(in thousands):4Q 20234Q 2022% ChangeFY 2023FY 2022% Change
Premiums$14,460 $13,756 5 %$50,917 $50,114 2 %



























*See “Non-GAAP Financial Measures” below.
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Earnings Conference Call

SelectQuote, Inc. will host a conference call with the investment community on September 13, 2023, beginning at 8:30 a.m. ET. To register for this conference call, please use this link: https://www.netroadshow.com/events/login?show=c37e5fba&confId=54604Avoid. 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 12.

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: the ultimate duration and impact of the ongoing COVID-19 pandemic and any other 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, including exclusively online brokers and carriers who opt to sell
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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; 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; and failure to market and sell Medicare plans effectively or in compliance with laws. 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.
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SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)

June 30, 2023June 30, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents$83,156 $140,997 
Accounts receivable, net of allowances of $2.7 million and $0.6 million, respectively154,565 129,748 
Commissions receivable-current111,148 116,277 
Other current assets14,355 15,751 
Total current assets363,224 402,773 
COMMISSIONS RECEIVABLE—Net729,350 722,349 
PROPERTY AND EQUIPMENT—Net27,452 41,804 
SOFTWARE—Net14,740 16,301 
OPERATING LEASE RIGHT-OF-USE ASSETS23,563 28,016 
INTANGIBLE ASSETS—Net10,200 31,255 
GOODWILL29,136 29,136 
OTHER ASSETS21,586 18,418 
TOTAL ASSETS$1,219,251 $1,290,052 
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable$27,577 $24,766 
Accrued expenses16,993 26,002 
Accrued compensation and benefits49,966 42,150 
Operating lease liabilities—current5,175 5,261 
Current portion of long-term debt33,883 7,169 
Contract liabilities1,691 3,404 
Other current liabilities1,972 4,761 
Total current liabilities137,257 113,513 
LONG-TERM DEBT, NET—less current portion664,625 698,423 
DEFERRED INCOME TAXES39,581 50,080 
OPERATING LEASE LIABILITIES27,892 33,946 
OTHER LIABILITIES2,926 2,985 
Total liabilities872,281 898,947 
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value1,669 1,644 
Additional paid-in capital567,266 554,845 
Accumulated deficit(235,644)(177,100)
Accumulated other comprehensive income13,679 11,716 
Total shareholders’ equity346,970 391,105 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$1,219,251 $1,290,052 
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SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(Unaudited)
(In thousands)
Three Months Ended June 30,Year Ended June 30,
2023202220232022
REVENUE:
Commission$119,844 $94,809 $653,470 $587,518 
Pharmacy79,905 27,929 239,547 59,460 
Other22,029 16,656 109,831 117,067 
Total revenue221,778 139,394 1,002,848 764,045 
OPERATING COSTS AND EXPENSES:
Cost of revenue65,697 37,722 301,524 391,528 
Cost of goods sold—pharmacy revenue71,211 64,172 225,963 64,172 
Marketing and advertising63,521 75,080 301,245 484,084 
Selling, general, and administrative49,856 30,449 136,518 100,945 
Technical development7,154 6,054 26,015 24,729 
Goodwill impairment— 44,596 — 44,596 
Total operating costs and expenses257,439 258,073 991,265 1,110,054 
INCOME (LOSS) FROM OPERATIONS(35,661)(118,679)11,583 (346,009)
INTEREST EXPENSE, NET(21,721)(12,295)(80,606)(43,595)
OTHER EXPENSE, NET(3)(26)(121)(202)
LOSS BEFORE INCOME TAX BENEFIT(57,385)(131,000)(69,144)(389,806)
INCOME TAX BENEFIT(9,547)(26,318)(10,600)(92,302)
NET LOSS$(47,838)$(104,682)$(58,544)$(297,504)
NET LOSS PER SHARE:
Basic$(0.29)$(0.64)$(0.35)$(1.81)
Diluted$(0.29)$(0.64)$(0.35)$(1.81)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic166,709 164,427 166,140 164,042 
Diluted166,709 164,427 166,140 164,042 
OTHER COMPREHENSIVE INCOME NET OF TAX:
Gain on cash flow hedge605 2,129 1,963 11,487 
OTHER COMPREHENSIVE INCOME605 2,129 1,963 11,487 
COMPREHENSIVE LOSS$(47,233)$(102,553)$(56,581)$(286,017)
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SELECTQUOTE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)

Three Months Ended June 30,Year Ended June 30,
2023202220232022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss$(47,838)$(104,682)$(58,544)$(297,504)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization6,794 6,768 27,881 24,724 
Goodwill impairment— 44,596 — 44,596 
Loss on disposal of property, equipment, and software364 717 754 1,458 
Impairment of long-lived assets17,332 3,147 17,332 3,147 
Share-based compensation expense2,785 800 11,310 7,052 
Deferred income taxes(9,760)(26,338)(11,176)(92,716)
Amortization of debt issuance costs and debt discount2,426 1,243 8,676 5,461 
Write-off of debt issuance costs— — 710 — 
Accrued interest payable in kind3,565 — 12,015 — 
Non-cash lease expense1,070 1,002 4,185 4,067 
Changes in operating assets and liabilities:
Accounts receivable, net37,921 34,085 (24,817)(25,749)
Commissions receivable(18,964)(329)(1,872)7,271 
Other assets(2,997)(2,641)169 (10,915)
Accounts payable and accrued expenses(10,089)(12,559)(3,649)(4,464)
Operating lease liabilities(1,312)(1,274)(5,643)(5,143)
Other liabilities12,161 1,513 3,292 401 
Net cash used in operating activities(6,542)(53,952)(19,377)(338,314)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment(391)(283)(1,447)(24,798)
Purchases of software and capitalized software development costs(1,874)(2,280)(7,678)(9,851)
Acquisition of business— — — (6,927)
Investment in equity securities— — — (1,000)
Net cash used in investing activities(2,265)(2,563)(9,125)(42,576)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Revolving Credit Facility— — — 50,000 
Payments on Revolving Credit Facility— — — (50,000)
Proceeds from Term Loans— — — 242,000 
Payments on Term Loans— (1,793)(17,833)(3,585)
Payments on other debt(35)(54)(158)(184)
Proceeds from common stock options exercised and employee stock purchase plan— — 1,187 3,179 
Payments of tax withholdings related to net share settlement of equity awards— — (40)(148)
Payments of debt issuance costs— — (10,110)(328)
Payment of acquisition holdback(50)— (2,385)(5,501)
Net cash (used in) provided by financing activities(85)(1,847)(29,339)235,433 
NET DECREASE IN CASH AND CASH EQUIVALENTS(8,892)(58,362)(57,841)(145,457)
CASH AND CASH EQUIVALENTS—Beginning of period92,048 199,359 140,997 286,454 
CASH AND CASH EQUIVALENTS—End of period$83,156 $140,997 $83,156 $140,997 

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SELECTQUOTE, INC. AND SUBSIDIARIES
Net Loss to Adjusted EBITDA Reconciliation
(Unaudited)

Three Months Ended June 30, 2023
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$103,592 $82,803 $38,052 $(1,266)$(1,403)$221,778 
Operating expenses(87,445)(81,118)(31,350)(5,970)(21,715)(227,598)
Other income (expense), net— — — 1 (4)(3)
Adjusted EBITDA$16,147 $1,685 $6,702 $(7,235)$(23,122)(5,823)
Share-based compensation expense(2,785)
Transactions costs(2,568)
Depreciation and amortization(6,793)
Loss on disposal of property, equipment, and software(363)
Impairment of long-lived assets(17,332)
Interest expense, net(21,721)
Income tax benefit9,547 
Net loss$(47,838)
Change in estimate from structured book of business migration for Auto & Home$10,427 
Adjusted consolidated net loss$(37,411)


Three Months Ended June 30, 2022
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$68,452 $30,036 $37,331 $7,126 $(3,551)$139,394 
Operating expenses(101,026)(41,836)(36,755)(5,650)(14,905)(200,172)
Other expenses, net— — — — (26)(26)
Adjusted EBITDA$(32,574)$(11,800)$576 $1,476 $(18,482)(60,804)
Share-based compensation expense(800)
Non-recurring expenses(1,873)
Depreciation and amortization(6,768)
Loss on disposal of property, equipment, and software(717)
Goodwill impairment(44,596)
Impairment of long-lived assets(3,147)
Interest expense, net(12,295)
Income tax benefit26,318 
Net loss$(104,682)

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Year Ended June 30, 2023
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$590,131 $252,075 $145,832 $21,862 $(7,052)$1,002,848 
Operating expenses(435,054)(274,844)(122,759)(21,782)(73,985)(928,424)
Other expenses, net— — — 1 (122)(121)
Adjusted EBITDA$155,077 $(22,769)$23,073 $81 $(81,159)74,303 
Share-based compensation expense(11,310)
Transaction costs(5,569)
Depreciation and amortization(27,881)
Loss on disposal of property, equipment, and software(749)
Impairment of long-lived assets(17,332)
Interest expense, net(80,606)
Income tax benefit10,600 
Net loss$(58,544)
Change in estimate from structured book of business migration for Auto & Home$10,427 
Adjusted consolidated net loss$(48,117)


Year Ended June 30, 2022
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$527,907 $70,035 $153,973 $27,881 $(15,751)$764,045 
Operating expenses(689,609)(102,132)(154,102)(22,448)(56,058)(1,024,349)
Other expenses, net— — — — (202)(202)
Adjusted EBITDA$(161,702)$(32,097)$(129)$5,433 $(72,011)(260,506)
Share-based compensation expense(7,052)
Non-recurring expenses(4,730)
Depreciation and amortization(24,724)
Loss on disposal of property, equipment, and software(1,456)
Goodwill impairment(44,596)
Impairment of long-lived assets(3,147)
Interest expense, net(43,595)
Income tax benefit92,302 
Net loss$(297,504)












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SELECTQUOTE, INC. AND SUBSIDIARIES
Revenue to Adjusted EBITDA - Revenue Adjustments
(Unaudited)

Three Months Ended June 30, 2023
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$103,592 $82,803 $38,052 $(1,266)$(1,403)$221,778 
Change in estimate from structured book of business migration for Auto & Home— — — 10,427 — 10,427 
Revenue, excluding change in estimate from structured book of business migration for Auto & Home103,592 82,803 38,052 9,161 (1,403)232,205 
Operating expenses(87,445)(81,118)(31,350)(5,970)(21,715)(227,598)
Other expenses, net— — — 1 (4)(3)
Adjusted EBITDA$16,147 $1,685 $6,702 $3,192 $(23,122)$4,604 



Year Ended June 30, 2023
(in thousands)SeniorHealthcare ServicesLifeAuto & HomeCorp & ElimsConsolidated
Revenue$590,131 $252,075 $145,832 $21,862 $(7,052)$1,002,848 
Change in estimate from structured book of business migration for Auto & Home— — — 10,427 — 10,427 
Revenue, excluding change in estimate from structured book of business migration for Auto & Home590,131 252,075 145,832 32,289 (7,052)1,013,275 
Operating expenses(435,054)(274,844)(122,759)(21,782)(73,985)(928,424)
Other expenses, net— — — 1 (122)(121)
Adjusted EBITDA$155,077 $(22,769)$23,073 $10,508 $(81,159)$84,730 



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SELECTQUOTE, INC. AND SUBSIDIARIES
Net Loss to Adjusted EBITDA Reconciliation
(Unaudited)



Guidance net loss to Adjusted EBITDA reconciliation, year ending June 30, 2024:

(in thousands)Range
Net loss$(50,000)$(22,000)
Income tax benefit(18,000)(8,000)
Interest expense, net102,000 97,000 
Depreciation and amortization24,000 22,000 
Share-based compensation expense14,000 12,000 
Transaction costs8,000 4,000 
Adjusted EBITDA$80,000 $105,000 



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