Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - HEALTHEQUITY, INC. | jpmhcconf2018.htm |
| 8-K - 8-K - HEALTHEQUITY, INC. | a8-kxestimatedsalesresults.htm |
Copyright © 2017 HealthEquity, Inc. All rights reserved.
Investor presentation
JP Morgan Healthcare Conference January 2018
Safe Harbor
2
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 (SEC), which public filings
are expressly incorporated herein by reference (see http://ir.healthequity.com/), and other publicly available information. Readers are encouraged to review
our public filings for further information.
This presentation contains “forward-looking” statements that are based on our management’s beliefs and assumptions and on information currently available to
management. These forward-looking statements include, without limitation, statements regarding our industry, business strategy, plans, goals and expectations
concerning our market position, product expansion, future operations, margins, profitability, future efficiencies, capital expenditures, liquidity and capital resources and
other financial and operating information. When used in this discussion, the words “may,” “believes,” “intends,” “seeks,” “anticipates,” “plans,” “estimates,” “expects,”
“should,” “assumes,” “continues,” “could,” “will,” “future” and the negative of these or similar terms and phrases are intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be
materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Forward-looking statements represent
our management’s beliefs and assumptions only as of the date of this presentation. Our actual future results may be materially different from what we expect. Except as
required by law, we assume no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those
anticipated in the forward-looking statements, even if new information becomes available in the future. Readers are encouraged to review our public filings with the SEC
for further disclosure of other factors that could cause actual results to differ materially from those indicated in any forward-looking statements included herein.
This presentation also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other data about our
industry. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates.
This presentation includes certain non-GAAP financial measures as defined by SEC rules. As required by Regulation G, we have provided a reconciliation of those
measures to the most directly comparable GAAP measures, which is available in our public filings.
No part of this presentation may be copied, recorded, or rebroadcast in any form.
Investment highlights
3
1. HealthEquity data measured for fiscal years 2014 to 2017
2. Based on Devenir Research HSA reports December 31, 2010-2016
Key metrics
4
0%
100%
200%
300%
400%
500%
600%
700%
FY14 FY15 FY16 FY17 YTD FY18 TTM
C
u
m
ula
ti
ve
Gro
w
th
1. For the fiscal year ended January 31, 2017
2. Balances as of October 31, 2017
Revenue
Adj. EBITDA
HSAs
Custodial Assets
Rising first dollar responsibility
5
The differences among health plans are narrowing as all plans
trend toward higher deductibles
10-Year
CAGR
Deductible:
HMO PPO POS HDHP
Source: Kaiser Family Foundation 2017 Survey report – September 2017
13.7% 9.2% 7.1% 2.3%
$-
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Deductible for Family Plan
HMO PPO POS HDHP HDHP min
Our core – health savings accounts
6
$6,900
Maximum family HSA contribution
$1,900
Average premium savings1
$1,417
Average employer contribution1
SOURCE: 1. Kaiser Family Foundation, 2017 Employee Benefits Survey
2. MEDACorp Survey referenced in Leerink 2017 Outlook report December 12, 2016.
6%
9%
11% 11%
14%
15%
19% 19%
8%
7%
7% 7% 6% 6% 6% 6%
2010 2011 2012 2013 2014 2015 2016 2017
HSA plan penetration1
Commercial healthcare inflation2
Expanding market
7 1. Devenir HSA Report 6/30/20172. Management estimate
Growing market share
8
4%
7%
8%
9% 9%
11%
13%
4%
6%
7%
8%
9%
10%
12%
2010 2011 2012 2013 2014 2015 2016
Rank
Based on Devenir Research HSA reports December 31, 2010-2016
HealthEquity HSAs market share
UNH
20%
HQY
12%
WBS
14%
All
Others
54%
Custodial assets
UNH
16%
HQY
13%
WBS
11%
All
Others
60%
HSAs
#7 #6 #4/5 #4/5 #4/5 #4/3 #2/3
By custodial assets
By HSA
Proprietary end-to-end platform
9 HealthEquity data as of January 31, 2017
FY 18 sales results
10
• Largest HSA take
away
• Preferred relationship
agreements with
Blue Cross Blue
Shield Association
and Health Plan
Alliance
• Renewal of
Anthem partnership
Powerful monetization
11
Service
Card
Cash
Investing
Service
40%
Custodial
38%
Interchange
22%
FY18 YTD*
Service
50%
Custodial
31%
Interchange
19%
FY14
*Nine months as of October 31, 2017
Growing forward
12
1. Kaiser Family Foundation Annual Survey 2017
2. Devenir Research HSA report, December 31, 2016
3. Management estimate based on HealthEquity HSAs as a percent of eligible employees within enterprise employers
Account balance growth by age
13
$7,457
$6,783
$5,493
$4,588
$4,059
$3,595
$3,053
$2,464
$2,061 $1,710 $1,355 $1,232
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
12/31/16 12/31/15 12/31/14 12/31/13 12/31/12
Average balance by year the account opened*
* Devenir Research HSA report December 31, 2016
Value of mature accounts
14
$1,595
$4,544 $3,914 $240
$9,993
$1,835
$320
$4,544
$13,907
AVG HSA SPENDER CONFIDENT CONSUMER HEALTHY SAVER
NOTE: HealthEquity data as of January 31, 2017
Rising above
15
1. Data as of January 31, 2017
2. Devenir Research HSA report, December 31, 2016
3. Management estimate as of January 31, 2017
4. HealthEquity data as of October 31, 2017
3rd quarter operating results
16
HSAs (000s)
• New organic Q3 HSAs of 109K vs 89K YoY
• An additional 14K FIBK HSAs
• 27% Q3 growth in ending HSAs YoY
• Net increase of $1.3B YoY
• 30% growth YoY
NOTE: Historic performance depicted is not necessarily indicative of past and future performance. For more information, see our Company’s public filings with the Securities and Exchange Commission
2,308
3,713
4,593
385
571
987
2,693
4,284
5,580
Q3 FY16 Q3 FY17 Q3 FY18
Cash Assets Investment Assets
Custodial Assets ($M)
1,108
1,602
2,378
494
776
635
1,602
2,378
3,013
Q3 FY16 Q3 FY17 Q3 FY18
Net new HSAs
3rd quarter financial results
17
NOTE: Historic performance depicted is not necessarily indicative of past and future performance. For more information, see our Company’s public filings with the Securities and Exchange Commission
(1) See Appendix for a reconciliation of net income, the most comparable GAAP measure, to Adjusted EBITDA.
• 31% Q3 revenue growth YoY
- 22% Q3 growth in Service Revenue
- 48% Q3 growth in Custodial Revenue
- 22% Q3 growth in Interchange Revenue
• 46% Adjusted EBITDA growth Q3 YoY
• Q3 Gross margins 59%
• Q3 Operating margins 24%
Revenue ($M)
Three Months
$30.6
$43.4
$56.8
FY16 FY17 FY18
$90.9
$131.6
$169.1
FY16 FY17 FY18
Nine Months
$31.8
$51.0
$67.6
FY16 FY17 FY18
Adjusted EBITDA
(1)
($M)
$9.9
$14.5
$21.2
FY16 FY17 FY18
Three Months Nine Months
Capitalization
18
($ in millions) January 31, 2017 October 31, 2017
Cash, cash equivalents
& marketable securities $180.4 $225.1
Long-term debt ($100M available LOC) $0.0 $0.0
Total equity $261.9 $334.4
NOTE: For more information, see our public filings with the Securities and Exchange Commission.
Guidance
19
Business Outlook
For the Fiscal Year Ending January 31, 2018
Guidance as of:
($ in millions, except per share) December 5, 2017
* September 5, 2017 June 6, 2017 March 21, 2017
Revenue $225 - $228 $223 – $228 $222 - $227 $220 - $225
Non-GAAP Net Income** $39 - $41 $39 - $43 $38 - $42
Non-GAAP EPS diluted** $0.64 - $0.66 $0.64 - $0.68 $0.62 - $0.67
Adjusted EBITDA** $80 - $83 $79 – $84 $78 - $83 $77 - $82
*Guidance issued in press release dated December 5, 2017. We do not undertake to update this guidance, which speaks only as of the date given.
** See press release on December 5, 2017, for a reconciliation of net income, the most comparable GAAP measure, to Non-GAAP Net Income, Non-GAAP EPS and Adjusted EBITDA.
