SelectQuote, Inc. Q1 FY2025 earnings call

• Strong start to the year with AEP ahead of expectations, leading to increased fiscal 2025 outlook on top- and bottom-line.
• Senior distribution: High retention of tenured agents, improved agent close rates and productivity, stable policy volume in slow quarter, Medicare Advantage LTV improved to $812.
• Healthcare Services: SelectRx membership up 64% YOY, sixth straight quarter of profitability, investing in new Olathe, Kansas facility.
• Balance sheet optimization: $100 million securitization, extended term debt maturities by ~2 years, lower cost of capital, potential for further balance sheet improvement.

Senior distribution: Revenue was $93 million, adjusted EBITDA improved to $8 million. Approved policies were stable year-over-year in a seasonally slow quarter, driven by close rates and agent productivity. Medicare Advantage LTV improved to $812. Healthcare Services (SelectRx): Membership over 86,000, up 64% year-over-year. Revenue $156 million, adjusted EBITDA $5 million (sixth straight quarter of profitability). Life business: Revenue $39 million, adjusted EBITDA grew almost 14%.

• Fiscal 2025 revenue revised to $1.425 billion to $1.525 billion, up from prior range of $1.4 billion to $1.5 billion.
• Adjusted EBITDA revised to $100 million to $130 million, up from prior range of $90 million to $120 million, driven by first quarter outperformance and AEP expectations.

• Uncertainties in forward-looking statements, including those described in earnings release, quarterly report on Form 10-Q for the period ended September 30, 2024, and other SEC filings.

Q: Ben Hendrix from RBC Capital Markets asked about balancing policy education and agent productivity in dynamic AEP, and how SelectRx fits in.

A: Tim Danker and Bob Grant responded, discussing increased agent close rates, efficiency through technology and tenured agents, and SelectRx being separate with no extra time for agents.

Q: George Sutton from Craig-Hallum asked about politics in AEP and extension of AEP.

A: Tim Danker and Bill Grant responded, noting strong Q1 results, reduced reliance on TV advertising, and optimism about AEP progress.

Q: Pat McCann from NOBLE Capital Markets asked about technology enhancements and marketing flexibility in Healthcare Services.

A: Bob Grant and Bill Grant responded, discussing agent-led technology, wide funnel marketing flexibility, and potential for acquisitions in healthcare ecosystem.