Equibles

8-K

SelectQuote, Inc. (SLQT)

8-K 2022-05-05 For: 2022-05-05
View Original
Added on April 07, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________

Form 8-K

Current Report

_______________

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 5, 2022

SELECTQUOTE, INC.

(Exact name of registrant as specified in its charter)

_____________

Delaware 001-39295 94-3339273
(State or other jurisdiction of incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
6800 West 115th Street, Suite 2511
Overland Park, Kansas 66211
(Address of principal executive offices) (Zip code)
(913) 599-9225
(Registrant’s telephone number, including area code)
No change since last report
(Former Name or Address, If Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol Name of each exchange on which registered
Common Stock, $0.01 par value SLQT New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02    Results of Operations and Financial Condition.

On May 5, 2022, the Company reported its financial results for the third quarter ended March 31, 2022. A copy of the related press release and investor presentation are attached hereto as Exhibits 99.1 and 99.2, respectively.

These exhibits are being furnished pursuant to Item 2.02, and the information contained therein shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall either of them be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits.

(d)    Exhibits

Exhibit No. Description of Exhibit
99.1 Press Release
99.2 Investor Presentation
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

SELECTQUOTE, INC.

Date: May 5, 2022 By: /s/ Raffaele Sadun
Name: Raffaele Sadun
Title: Chief Financial Officer

Document

Exhibit 99.1

SelectQuote, Inc. Reports Third Quarter of Fiscal Year 2022 Results

Third Quarter of Fiscal Year 2022 – Consolidated Earnings Highlights

•Revenue of $275.1 million

•Net Loss of $6.4 million

•Adjusted EBITDA* of $13.0 million

•No update to Full-Year Fiscal 2022 Revenue, Net Loss and Adjusted EBITDA Guidance:

◦Revenue expected in a range of $810 million to $850 million

◦Net Loss expected in a range of $255 million to $236 million

◦Adjusted EBITDA* expected in a range of $(260) million to $(235) million

Third Quarter of Fiscal Year 2022 – Segment Highlights

Senior

•Revenue of $233.2 million

•Adjusted EBITDA* of $32.2 million

•Approved Medicare Advantage policies grew 48% Year-Over-Year

Life

•Revenue of $39.4 million

•Final expense premiums grew 15% Year-Over-Year

Auto & Home

•Revenue of $7.2 million

•Total Auto & Home premiums grew 4% Year-Over-Year

OVERLAND PARK, Kan., May 5, 2022--(BUSINESS WIRE)--SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the third quarter of fiscal year 2022 of $275.1 million compared to consolidated revenue for the third quarter of fiscal year 2021 of $265.3 million. Consolidated net loss for the third quarter of fiscal year 2022 was $6.4 million compared to consolidated net income for the third quarter of fiscal year 2021 of $35.2 million. Finally, consolidated Adjusted EBITDA* for the third quarter of fiscal year 2022 was $13.0 million, compared to consolidated Adjusted EBITDA* for the third quarter of fiscal year 2021 of $63.6 million.

Chief Executive Officer Tim Danker commented, “We were pleased with our third quarter results, which finished ahead of our internal expectations. During the quarter, we saw improved sales conversion rates and lower marketing cost per sale, which while early, gives us even more confidence about the steps we are taking to improve our operating and financial results. As we execute on our planned pullback in Medicare policy sales in the near term, we are focused now more than ever on delivering high-value business to our carrier partners and to improving the cash efficiency of our business. We are also thrilled with the continued momentum of the Population Health business, particularly our SelectRx pharmacy business, which ended April with over 23,000 members, a nearly 10-fold increase in less than a year.”

Raff Sadun, Chief Financial Officer, also commented, “As discussed on our second quarter call, a key aspect of our long-term strategy is to reduce the overall operating leverage of our business to deliver attractive returns in a wide range of potential market scenarios. We made major progress on that front during the quarter, identifying over $200 million in expense reduction opportunities, excluding our planned investments in the growth of our cash-efficient SelectRx business. Approximately 20% of those identified savings are fixed cost actions we already executed during the 3rd quarter. While we are not updating our 2022 guidance, so far we see similar trends in the fourth quarter and are more focused on full year 2023.”

*See reconciliation from GAAP to non-GAAP measures starting on page 11.

Segment Results

We currently report on three segments: 1) Senior, 2) Life and 3) Auto & Home. The performance measures of the segments include total revenue and Adjusted EBITDA.* Costs of revenue, marketing and advertising, and technical development operating costs and expenses that are directly attributable to a segment are reported within the applicable segment. Indirect costs of revenue, marketing and advertising, and technical development operating costs and 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, marketing and advertising, technical development, and 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; restructuring expenses; and non-recurring expenses such as severance payments and transaction costs.

Senior

Financial Results

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

Three Months Ended March 31, Nine Months Ended March 31,
(in thousands) 2022 2021 % Change 2022 2021 % Change
Revenue $ 233,172 $ 215,600 8 % $ 497,459 $ 604,309 (18) %
Adjusted EBITDA* 32,182 75,489 (57) % (149,424) 218,946 (168) %
Adjusted EBITDA Margin* 14 % 35 % (30) % 36 %

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, such as providing additional information, before the application will be reviewed by the insurance carrier.

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

Three Months Ended March 31, Nine Months Ended March 31,
2022 2021 % Change 2022 2021 % Change
Medicare Advantage 242,721 160,233 51 % 678,827 454,772 49 %
Medicare Supplement 1,389 3,738 (63) % 6,318 24,287 (74) %
Dental, Vision and Hearing 40,178 38,757 4 % 122,214 101,819 20 %
Prescription Drug Plan 1,079 1,568 (31) % 6,193 10,243 (40) %
Other 4,907 6,781 (28) % 11,436 12,603 (9) %
Total 290,274 211,077 38 % 824,988 603,724 37 %

*See reconciliation from GAAP to non-GAAP measures starting on page 11.

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:

Three Months Ended March 31, Nine Months Ended March 31,
2022 2021 % Change 2022 2021 % Change
Medicare Advantage 196,377 132,950 48 % 546,031 384,137 42 %
Medicare Supplement 1,159 3,073 (62) % 4,654 19,849 (77) %
Dental, Vision and Hearing 34,486 34,517 — % 101,251 84,370 20 %
Prescription Drug Plan 1,095 2,109 (48) % 5,315 9,556 (44) %
Other 3,836 5,129 (25) % 9,199 10,209 (10) %
Total 236,953 177,778 33 % 666,450 508,121 31 %

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:

Three Months Ended March 31, Nine Months Ended March 31,
(dollars per policy): 2022 2021 % Change 2022 2021 % Change
Medicare Advantage $ 933 $ 1,362 (31) % $ 935 $ 1,290 (28) %
Medicare Supplement 949 1,345 (29) % 1,275 1,263 1 %
Dental, Vision and Hearing 120 129 (7) % 123 140 (12) %
Prescription Drug Plan 229 213 8 % 235 230 2 %
Other 95 60 58 % 77 95 (19) %

Per Unit Economics

Per unit economics represents total Medicare Advantage and Medicare Supplement commissions, other product commissions, other revenues, and costs associated with the Senior segment, each shown per number of approved Medicare Advantage and Medicare Supplement policies over a given time period. Management assesses the business on a per-unit basis to help ensure 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 Medicare Advantage and Medicare Supplement commission per MA/MS policy represents the lifetime value of commissions for policies sold in the period. Other commission per MA/MS policy represents the lifetime value of commissions for other products sold in the period, including dental, vision and hearing, prescription drug plan, and other products, which management views as additional commission revenue on our agents’ core function of MA/MS policy sales. Other per MA/MS policy represents the production bonuses, lead sales revenue from InsideResponse, and updated estimates of prior period variable consideration based on actual policy renewals in the current period. Total operating expenses per MA/MS policy represents all of the operating expenses within the Senior segment. The Revenue to customer acquisition cost (“CAC”) multiple represents total revenue per MA/MS policy 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 per unit economics for the periods presented. Based on the seasonality of the Senior segment 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. These metrics are the basis on which management assesses the business:

Twelve Months Ended March 30,
(dollars per approved policy): 2022 2021 % Change
Medicare Advantage and Medicare Supplement approved policies 636,195 464,653 37 %
Medicare Advantage and Medicare Supplement commission per MA/MS policy $ 963 $ 1,286 (25) %
Other commission per MA/MS policy 29 38 (24) %
Other per MA/MS policy (14) 166 (108) %
Total revenue per MA/MS policy 978 1,490 (34) %
Total operating expenses per MA/MS policy (1,173) (947) 24 %
Adjusted EBITDA per MA/MS policy* $ (195) $ 543 (136) %
Adjusted EBITDA Margin per MA/MS policy* (20) % 36 % (155) %
Revenue/CAC multiple 1.8X 3.1X

Life

Financial Results

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

Three Months Ended March 31, Nine Months Ended March 31,
(in thousands) 2022 2021 % Change 2022 2021 % Change
Revenue $ 39,400 $ 44,823 (12) % $ 119,612 $ 121,917 (2) %
Adjusted EBITDA* (1,888) 1,598 (218) % 2,265 16,385 (86) %
Adjusted EBITDA Margin* (5) % 4 % 2 % 13 %

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 reconciliation from GAAP to non-GAAP measures starting on page 11.

The following table shows term and final expense premiums for the periods presented:

Three Months Ended March 31, Nine Months Ended March 31,
(in thousands) 2022 2021 % Change 2022 2021 % Change
Term Premiums $ 14,933 $ 19,043 (22) % $ 45,990 $ 56,784 (19) %
Final Expense Premiums 28,532 24,817 15 % 83,718 56,269 49 %
Total $ 43,465 $ 43,860 (1) % 129,708 113,053 15 %

Auto & Home

Financial Results

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

Three Months Ended March 31, Nine Months Ended March 31,
(in thousands) 2022 2021 % Change 2022 2021 % Change
Revenue $ 7,152 $ 6,973 3 % $ 20,755 $ 23,752 (13) %
Adjusted EBITDA* 1,150 1,096 5 % 3,957 6,863 (42) %
Adjusted EBITDA Margin* 16 % 16 % 19 % 29 %

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:

Three Months Ended March 31, Nine Months Ended March 31,
(in thousands): 2022 2021 % Change 2022 2021 % Change
Premiums $ 12,516 $ 12,010 4 % $ 36,358 $ 42,165 (14) %

*See reconciliation from GAAP to non-GAAP measures starting on page 11.

Earnings Conference Call

SelectQuote, Inc. will host a conference call with the investment community today, Thursday, May 5, 2022, beginning at 8:30 a.m. ET. To register for this conference call, please use this link: http://www.directeventreg.com/registration/event/1378747. 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 a day in advance or at minimum 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 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 monitor and have presented in this release Adjusted EBITDA because it is a key measure 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 this non-GAAP financial measure helps identify underlying trends in our business that could otherwise be masked by the effect of the expenses that we exclude in the calculations of this non-GAAP financial measure. Accordingly, we believe that this financial measure provides useful information to investors and others in understanding and evaluating our operating results, enhancing the overall understanding of our past performance and future prospects.

Forward Looking Statement

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, 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, exclusively online brokers and carriers who opt to sell 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; 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 claims, including IP litigation; our existing and future indebtedness; our ability to maintain compliance with or renegotiate or obtain waivers of our debt covenants; developments with respect to LIBOR; 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”) 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. SelectQuote 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 the company’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. SelectQuote has three core business lines: SelectQuote Senior, SelectQuote Life and SelectQuote Auto and Home. SelectQuote Senior, the largest and fastest-growing business, serves the needs of a demographic that sees 10,000 people turn 65 each day with a range of Medicare Advantage and Medicare Supplement plans. In 2021, SelectQuote expanded its business with the addition of Population Health, a healthcare services company, and SelectRx, a specialty medication management pharmacy.

Investor Relations:

Sloan Bohlen

877-678-4083

investorrelations@selectquote.com

Media:

Matt Gunter

913-286-4931

matt.gunter@selectquote.com

Source: SelectQuote, Inc.

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

March 31, 2022 June 30, 2021
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 199,359 $ 286,454
Accounts receivable 168,735 105,298
Commissions receivable-current 77,158 89,120
Other current assets 13,246 4,486
Total current assets 458,498 485,358
COMMISSIONS RECEIVABLE 761,138 756,777
PROPERTY AND EQUIPMENT—Net 45,558 29,510
SOFTWARE—Net 15,558 12,611
OPERATING LEASE RIGHT-OF-USE ASSETS 29,018 31,414
INTANGIBLE ASSETS—Net 36,022 40,670
GOODWILL 73,732 68,019
OTHER ASSETS 15,790 1,436
TOTAL ASSETS $ 1,435,314 $ 1,425,795
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable $ 27,445 $ 34,079
Accrued expenses 35,593 20,676
Accrued compensation and benefits 46,229 40,909
Operating lease liabilities—current 5,181 5,289
Current portion of long-term debt 7,169 2,360
Other current liabilities 2,079 5,504
Total current liabilities 123,696 108,817
LONG-TERM DEBT, NET—less current portion 699,386 459,043
DEFERRED INCOME TAXES 76,806 139,240
OPERATING LEASE LIABILITIES 35,301 38,392
OTHER LIABILITIES 3,533 11,743
Total liabilities 938,722 757,235
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value 1,644 1,635
Additional paid-in capital 554,045 544,771
Retained earnings (accumulated deficit) (68,684) 121,925
Accumulated other comprehensive income 9,587 229
Total shareholders’ equity 496,592 668,560
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 1,435,314 $ 1,425,795

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Unaudited)

(In thousands)

Three Months Ended March 31, Nine Months Ended March 31,
2022 2021 2022 2021
REVENUE:
Commission $ 222,538 $ 235,216 $ 495,494 $ 660,631
Production bonus and other 52,575 30,130 132,127 85,054
Total revenue 275,113 265,346 627,621 745,685
OPERATING COSTS AND EXPENSES:
Cost of revenue 119,459 71,439 359,732 206,605
Marketing and advertising 125,082 116,690 409,005 298,696
General and administrative 21,031 19,251 64,570 44,496
Technical development 6,436 4,860 18,675 13,458
Total operating costs and expenses 272,008 212,240 851,982 563,255
INCOME (LOSS) FROM OPERATIONS 3,105 53,106 (224,361) 182,430
INTEREST EXPENSE, NET (12,179) (7,355) (31,300) (20,898)
LOSS ON EXTINGUISHMENT OF DEBT — (3,315) — (3,315)
OTHER EXPENSE, NET (23) (349) (177) (1,545)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT) (9,097) 42,087 (255,838) 156,672
INCOME TAX EXPENSE (BENEFIT) (2,649) 6,852 (65,229) 31,846
NET INCOME (LOSS) $ (6,448) $ 35,235 $ (190,609) $ 124,826
NET INCOME (LOSS) PER SHARE:
Basic $ (0.04) $ 0.21 $ (1.16) $ 0.77
Diluted $ (0.04) $ 0.21 $ (1.16) $ 0.75
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic 164,083 163,023 163,914 162,705
Diluted 164,083 165,731 163,914 165,495
OTHER COMPREHENSIVE INCOME, NET OF TAX:
Gain on cash flow hedge 7,589 1,810 9,358 1,669
OTHER COMPREHENSIVE INCOME 7,589 1,810 9,358 1,669
COMPREHENSIVE INCOME (LOSS) $ 1,141 $ 37,045 $ (181,251) $ 126,495

SELECTQUOTE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

Nine Months Ended March 31,
2022 2021
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (190,609) $ 124,826
Adjustments to reconcile net income (loss) to net cash and cash equivalents used in operating activities:
Depreciation and amortization 17,957 11,260
Loss on disposal of property, equipment, and software 741 261
Share-based compensation expense 6,252 3,689
Deferred income taxes (65,623) 31,702
Amortization of debt issuance costs and debt discount 4,217 2,482
Write-off of debt issuance costs — 2,570
Fair value adjustments to contingent earnout obligations — 1,487
Non-cash lease expense 3,065 2,869
Changes in operating assets and liabilities:
Accounts receivable (62,803) (49,224)
Commissions receivable 7,601 (251,188)
Other assets (8,275) 4,349
Accounts payable and accrued expenses 8,096 26,223
Operating lease liabilities (3,868) (2,631)
Other liabilities (1,113) 30,378
Net cash used in operating activities (284,362) (60,947)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (24,515) (6,520)
Purchases of software and capitalized software development costs (7,570) (5,807)
Acquisition of business (6,927) (23,879)
Investment in equity securities (1,000) —
Net cash used in investing activities (40,012) (36,206)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Revolving Credit Facility 50,000 —
Payments on Revolving Credit Facility (50,000) —
Proceeds from DDTL Facility 242,000 —
Payments on DDTL Facility (613) —
Net proceeds from Term Loans — 228,753
Payments on Term Loans (1,180) (84,118)
Payments on other debt (130) (189)
Proceeds from common stock options exercised and employee stock purchase plan 3,179 1,778
Payments of tax withholdings related to net share settlement of equity awards (148) (10,026)
Payments of debt issuance costs (328) (885)
Payments of costs incurred in connection with private placement — (1,771)
Payments of costs incurred in connection with initial public offering — (3,911)
Payment of contingent earnout liability — (32,300)
Payment of acquisition holdback (5,501) —
Net cash provided by financing activities 237,279 97,331
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (87,095) 178
CASH AND CASH EQUIVALENTS—Beginning of period 286,454 368,870
CASH AND CASH EQUIVALENTS—End of period $ 199,359 $ 369,048

SELECTQUOTE, INC. AND SUBSIDIARIES

Adjusted EBITDA to Net Income (Loss) Reconciliation

(Unaudited)

Three Months Ended March 31, 2022
(in thousands) Senior Life Auto & Home Corp & Elims Consolidated
Revenue $ 233,172 $ 39,400 $ 7,152 $ (4,611) $ 275,113
Operating expenses (200,990) (41,288) (6,002) (13,819) (262,099)
Other expenses, net — — — (23) (23)
Adjusted EBITDA 32,182 (1,888) 1,150 (18,453) 12,991
Share-based compensation expense (2,143)
Non-recurring expenses (703)
Depreciation and amortization (6,679)
Loss on disposal of property, equipment, and software, net (384)
Interest expense, net (12,179)
Income tax benefit 2,649
Net loss $ (6,448)
Three Months Ended March 31, 2021
--- --- --- --- --- --- --- --- --- --- ---
(in thousands) Senior Life Auto & Home Corp & Elims Consolidated
Revenue $ 215,600 $ 44,823 $ 6,973 $ (2,050) $ 265,346
Operating expenses (140,111) (43,225) (5,877) (12,507) (201,720)
Other expenses, net — — — (15) (15)
Adjusted EBITDA 75,489 1,598 1,096 (14,572) 63,611
Share-based compensation expense (1,429)
Non-recurring expenses (4,667)
Fair value adjustments to contingent earnout obligations (334)
Depreciation and amortization (4,323)
Loss on disposal of property, equipment, and software (101)
Interest expense, net (7,355)
Loss on extinguishment of debt (3,315)
Income tax expense (6,852)
Net income $ 35,235

SELECTQUOTE, INC. AND SUBSIDIARIES

Adjusted EBITDA to Net Income (Loss) Reconciliation

(Unaudited)

Nine Months Ended March 31, 2022
(in thousands) Senior Life Auto & Home Corp & Elims Consolidated
Revenue $ 497,459 $ 119,612 $ 20,755 $ (10,205) $ 627,621
Operating expenses (646,883) (117,347) (16,798) (43,149) (824,177)
Other expenses, net — — — (177) (177)
Adjusted EBITDA (149,424) 2,265 3,957 (53,531) (196,733)
Share-based compensation expense (6,252)
Non-recurring expenses (2,857)
Depreciation and amortization (17,957)
Loss on disposal of property, equipment, and software, net (739)
Interest expense, net (31,300)
Income tax benefit 65,229
Net loss $ (190,609)
Nine Months Ended March 31, 2021
--- --- --- --- --- --- --- --- --- --- ---
(in thousands) Senior Life Auto & Home Corp & Elims Consolidated
Revenue $ 604,309 $ 121,917 $ 23,752 $ (4,293) $ 745,685
Operating expenses (385,363) (105,532) (16,889) (34,771) (542,555)
Other expenses, net — — — (58) (58)
Adjusted EBITDA 218,946 16,385 6,863 (39,122) 203,072
Share-based compensation expense (3,689)
Non-recurring expenses (5,490)
Fair value adjustments to contingent earnout obligations (1,487)
Depreciation and amortization (11,260)
Loss on disposal of property, equipment, and software (261)
Interest expense, net (20,898)
Loss on extinguishment of debt (3,315)
Income tax expense (31,846)
Net income $ 124,826

SELECTQUOTE, INC. AND SUBSIDIARIES

Net Loss to Adjusted EBITDA Reconciliation

(Unaudited)

Guidance net loss to Adjusted EBITDA reconciliation, year ending June 30, 2022:

(in thousands) Range
Net Loss $ (255,000) $ (236,000)
Income tax benefit (86,000) (80,000)
Interest expense, net 43,000 43,000
Depreciation and amortization 22,000 22,000
Share-based compensation expense 11,000 11,000
Non-recurring expenses 5,000 5,000
Adjusted EBITDA $ (260,000) $ (235,000)

13

selectquoteincmarch31202

| We shop. You save. 3rd Quarter Fiscal 2022 Earnings Conference Call Presentation May 5, 2022

| We shop. You save. 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 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; 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, exclusively online brokers and carriers who opt to sell 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; 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 claims, including IP litigation; our existing and future indebtedness; our ability to maintain compliance with or renegotiate or obtain waivers of our debt covenants; developments with respect to LIBOR; 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”) 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. Certain information contained in this presentation and statements made orally during this presentation relate to or are based on publications and other data obtained from third-party sources. While we believe these third-party sources to be reliable as of the date of this presentation, we have not independently verified, and make no representation as to the adequacy, fairness, accuracy or completeness of, any information obtained from such third-party sources. No Offer or Solicitation; Further Information This presentation is for informational purposes only and is not an offer to sell with respect to any securities. This presentation should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes thereto included in the Annual Report and subsequent quarterly reports. Non-GAAP Financial Measures This presentation 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 presentation 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 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 monitor and have presented in this presentation Adjusted EBITDA because it is a key measure 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. For further discussion regarding this non-GAAP measure, please see today’s press release. Disclaimer 2

| We shop. You save. Strong OEP results relative to internal forecast: • Bounce back in sales conversion rates driving additional policies • Improved marketing cost per approved policy driven by less competitive market and improved conversion • Actions taken to right-size cost structure Consolidated revenue totaled $275 million. Consolidated net loss totaled $6 million, or $(0.04) loss per diluted share. Consolidated Adjusted EBITDA* was $13 million We are making a clear shift toward a focus on profitability and cash generation in FY 2023 We have identified over $200M in Y/Y cost savings for FY23 (excluding SelectRx), with about 20% of that coming from fixed cost reductions already implemented during 3Q We continue to see strong performance and growth in our Population Health and SelectRx businesses, now totaling over 23,000 active SelectRx members as of April 30th 3rd Quarter Earnings Summary 3 *See reconciliations from GAAP measure, net income (loss), to non-GAAP measure, Adjusted EBITDA, on slide 11

| We shop. You save.| . . SelectRx active member growth from ~8,000 in January to over 23,000 as of April month end Announced creation of Healthcare Advisory Board SelectHearing will provide free hearing tests and affordable hearing aid options Planned pullback in MA submissions in FY23 Optimized marketing mix and refined targeting Reduced strain on recruiting, training, and onboarding functions Grow Healthcare Services MA Lifetime Value (LTV) Mitigate Operational Risk Factors New MA Growth Philosophy Go Forward Strategic Approach - Progress 4 Right-sizing cost structure with a plan to remove $200M in run rate cost ~20% of cost reductions from fixed cost actions taken during 3Q Smaller AEP hiring class resulting in more tenured agent force Constraint increased from 6% to 15% during Q2 Increased provision

| We shop. You save. 3rd Quarter Progress Category What Changed Results Marketing Agent Force (Operations) Cost Structure Decreased CAC 27% Y/Y Increased close rates 15% Y/Y Identified over $200M in Y/Y cost savings * • Refined targeting • Channel optimization • Softening of competition for leads • September class fully onboarded • Additional training • More tenured agent force • Actions taken during Q3 to reduce fixed costs 5 Population Health • Continued to increase SelectRx total active members throughout the quarter Ended April with over 23,000 SelectRx members *Excludes SelectRx

| We shop. You save. REVENUE $MM Adj. EBITDA* $MM $265 $275 3Q 2021 3Q 2022 $64 $13 3Q 2021 3Q 2022 6 Consolidated Financial Summary *See reconciliations from GAAP measure, net income (loss), to non-GAAP measure, Adjusted EBITDA, on slide 11

| We shop. You save. SelectQuote Senior KPI’s TOTAL POLICIES APPROVED 000s MA LTV 178 237 133 196 3 1 42 39 MA MS Other 3Q 2021 3Q 2022 7 $1,362 $933 3Q 2021 3Q 2022 PER UNIT OPERATING COSTS * $1,030 $837 3Q 2021 3Q 2022 *Represents Senior Distribution and Inside Response operating costs divided by Approved MA/MS Policies

| We shop. You save. SelectRx Progress 8 Members May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr — 5,000 10,000 15,000 20,000 25,000

| We shop. You save. Health Choice VBC & MCO ARIZONA Capitalization Summary • As of March 31, 2022: ◦ Net debt position of $516 million ▪ $199 million of cash and cash equivalents ▪ $715 million of term debt ◦ Accounts receivable, short and long term commissions receivable balances of $1 billion • No update to FY22 guidance 9

| We shop. You save. Supplemental Information 10

| We shop. You save. Net Income (Loss) to Adjusted EBITDA Reconciliation 3Q FY 2022 (in thousands) Senior Life Auto & Home Corp & Elims Consolidated Revenue $ 233,172 $ 39,400 $ 7,152 $ (4,611) $ 275,113 Operating expenses (200,990) (41,288) (6,002) (13,819) (1) (262,099) Other expenses, net — — — (23) (23) Adjusted EBITDA 32,182 (1,888) 1,150 (18,453) 12,991 Share-based compensation expense (2,143) Non-recurring expenses (703) Depreciation and amortization (6,679) Loss on disposal of property, equipment, and software, net (384) Interest expense, net (12,179) Income tax benefit 2,649 Net loss $ (6,448) 11 3Q FY 2021 (in thousands) Senior Life Auto & Home Corp & Elims Consolidated Revenue $ 215,600 $ 44,823 $ 6,973 $ (2,050) $ 265,346 Operating expenses (140,111) (43,225) (5,877) (12,507) (1) (201,720) Other expenses, net — — — (15) (15) Adjusted EBITDA 75,489 1,598 1,096 (14,572) 63,611 Share-based compensation expense (1,429) Non-recurring expenses (4,667) Fair value adjustments to contingent earnout obligations (334) Depreciation and amortization (4,323) Loss on disposal of property, equipment, and software (101) Interest expense, net (7,355) Loss on extinguishment of debt (3,315) Income tax expense (6,852) Net income $ 35,235

| We shop. You save. 12 SelectQuote Inc. 6800 West 115th Street Suite 2511 Overland Park, Kansas 66211 Phone: (913) 599-9225 Investor Relations investorrelations@selectquote.com

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