Health Insurance Innovations, Inc. (NASDAQ: HIIQ) (“HIIQ” or “the
Company”) today announced that as a result of its in-progress
strategic transformation and successful development and growth of
its Medicare business, the Company is extending its process for
exploring, reviewing, and evaluating alternative strategies focused
on maximizing shareholder value that commenced in July 2019. These
alternatives could include, among other things, a sale of the
Company or a portion thereof, a strategic business combination,
changes in the Company’s operations or strategy, or continuing to
execute on the Company’s current business plan.
“The Board of Directors believes that the best path for
enhancing value for our shareholders is to allow additional time
for potential strategic and financial partners to review the
Company’s strategy and recent and projected operating results,”
said Paul Gabos, Chairman of the Board. “We are encouraged by our
recent Medicare sales volume success and the level of interest that
this has garnered in the marketplace. Since the announcement of our
Medicare results in early December, we have received additional
inquiries from multiple new strategic parties expressing an
interest in participating in our process. We believe it is prudent
to allow these parties more time to complete their assessment of
the Company in light of the business transformation in
progress.”
The Company’s Board of Directors has not set a timetable for
completing the strategic review nor has it made any decisions
related to strategic alternatives at this time, and there can be no
assurance that the Board’s exploration of strategic alternatives
will result in changes in strategy or any transaction or, if a
transaction is undertaken, as to its terms, structure or timing.
The Company does not expect to make further public comment
regarding these matters unless and until the Board has approved a
specific transaction or alternative or otherwise concludes its
review of strategic alternatives.
BofA Securities is acting as financial advisor and Weil, Gotshal
& Manges LLP is acting as legal advisor to the Company.
In addition, the Company also announced preliminary financial
results and key metrics for fourth quarter and fiscal year
2019:
($ in millions except
per share data) |
Fourth Quarter
2019 |
Fiscal Year 2019 |
GAAP Revenues |
|
|
Individual and Family
Plan Products (“IFP”) |
$104 - $108 |
$313 - $317 |
Medicare |
$ 55 - $
56 |
$ 67 - $ 68 |
Total Revenues |
$159 - $164 |
$ 380 - $ 385 |
|
|
|
Adjusted EBITDA |
$ 44
- $ 48 |
$ 80 - $
84 |
|
|
|
Adjusted net income
per share |
$2.30 - $2.55 |
$4.10 - $4.35 |
|
|
|
|
As of 12/31/19 |
|
Gross Contract Asset
[1] |
|
|
IFP |
$ 322 |
|
Medicare |
$ 74 |
|
Total Gross Contract
Asset |
$ 396 |
|
|
|
|
Net Contract Asset
[2] |
|
|
IFP |
$ 191 |
|
Medicare |
$ 74 |
|
Total Net Contract
Asset |
$ 265 |
|
|
|
|
Debt Outstanding |
$ 179 |
|
|
|
|
Consolidated Total
Leverage |
2.3X |
|
(Credit Facility
Covenant Max: 3.5X) |
|
|
[1] The gross contract asset is inclusive of all future
collections from our members, reduced by the amount due to the
carriers or discount benefit plan providers.
[2] The net contract asset is the gross asset, less the future
commissions due to our third-party distribution partners.
“We are pleased with our preliminary fourth quarter and fiscal
year 2019 financial results which reflect annual growth in revenues
of approximately 8-10%, growth in Adjusted EBITDA of approximately
34-41%, and growth in Adjusted net income per share of
approximately 57-67%. Although revenues were slightly below our
forecast for 2019, we benefitted from the successful build-out of
our Medicare platform while narrowing our focus on certain IFP
products,” said Gavin Southwell, HIIQ’s President and Chief
Executive Officer.
The Company has not yet closed and finalized its financial
statement review process for the fourth quarter and full year 2019.
As a result, the information in this release is preliminary and
based upon information available to the Company as of the date of
this release, and thus remains subject to completion of normal
year-end accounting procedures, adjustments and audit. During the
course of the Company’s review process, items may be identified
that would require the Company to make adjustments, which could
result in changes to our preliminary selected financial information
above. As a result, the preliminary selected financial information
above is forward-looking information and subject to risks and
uncertainties, including possible adjustments to such information.
The Company expects to report its fourth quarter and full year 2019
results in March of 2020.
About Health Insurance Innovations, Inc.
(HIIQ)
HIIQ is a market leading cloud-based technology platform and
distributor of innovative health and life insurance products that
are affordable and meet the needs of consumers. HIIQ helps develop
insurance products through our relationships with best-in-class
insurance companies and markets them via its broad distribution
network of third-party licensed insurance agents across the nation,
its call center network and its unique online capabilities.
Additional information about HIIQ can be found
at HIIQ.com.
Non-GAAP Financial Information
The Company uses Adjusted EBITDA and Adjusted net income per
share, which are not calculated and presented in accordance with
U.S. generally accepted accounting principles (“GAAP”), to
understand and evaluate our core operating performance and trends
and to make period-to-period comparisons of our business.
To calculate Adjusted EBITDA, we calculate EBITDA, which is then
further adjusted for items such as stock-based compensation and
related costs, and items that are not generally a part of regular
operating activities, including tax receivable adjustments,
indemnity and other related legal costs, and severance,
restructuring, and acquisition costs. We define EBITDA as net
income before interest, income taxes and depreciation and
amortization.
Adjusted net income per share is computed by dividing adjusted
net income by the total number of weighted-average diluted Class A
and weighted-average Class B shares of our common stock for each
period. To calculate Adjusted net income, we calculate net income
then add back amortization (but not depreciation), interest, tax
expense, items such as stock-based compensation and related costs,
and other items that are not generally a part of regular operating
activities, including, tax receivable adjustments, indemnity and
other related legal costs, severance, restructuring, and
acquisition costs. From adjusted pre-tax net income, we apply a pro
forma tax expense calculated at an assumed rate of 24%, which
consists of the maximum federal corporate rate of 21%, with an
assumed 3% state tax rate.
The Company has not included a GAAP reconciliation of Adjusted
EBITDA and Adjusted net income per share because such
reconciliation could not be produced without unreasonable
effort.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995. Forward-looking statements are statements other than
historical fact, and may include statements relating to our
anticipated fourth quarter and full year 2019 financial results and
the strategic alternatives review process and potential
transactions that may be identified and explored as a result of
such review process, as well as statements relating to goals, plans
and projections regarding new markets, products, services, growth
strategies, anticipated trends in our business, and anticipated
changes and developments in the United States health insurance
system and laws. Forward-looking statements are based on HIIQ’s
current assumptions, expectations and beliefs are generally
identifiable by use of words “may,” “might,” “will,” “should,”
“expects,” “plans,” “anticipates,” “believes,” “estimates,”
“predicts,” “potential” or “continue,” or similar expressions and
involve significant risks and uncertainties that could cause actual
results, developments and business decisions to differ materially
from those contemplated by these statements. These risks and
uncertainties include, among other things, the timing, benefits and
outcome of our strategic alternatives review process, our ability
to maintain relationships and develop new relationships with health
insurance carriers and distributors, our ability to retain our
members, the demand for products offered through our platform,
factors affecting growth in the Medicare market, our ability to
grow our Medicare business, cash flow from our IFP business,
regulatory oversight and examinations of us and our carriers and
distributors, legal and regulatory compliance by our carriers and
distributors, the amount of commissions paid to us or changes in
health insurance plan pricing practices, competition, changes and
developments in the United States health insurance system and laws,
and HIIQ’s ability to adapt to them, the ability to maintain and
enhance our name recognition, difficulties arising from
acquisitions or other strategic transactions, and our ability to
build the necessary infrastructure and processes to maintain
effective controls over financial reporting. These and other risk
factors that could cause actual results to differ materially from
those expressed or implied in our forward-looking statements are
discussed in HIIQ's Annual Report on Form 10-K filed with the
Securities and Exchange Commission (SEC) as well as other documents
that may be filed by HIIQ from time to time with the Securities and
Exchange Commission, which are available at www.sec.gov. Any
forward-looking statement made by us in this press release is based
only on information currently available to us and speaks only as of
the date on which it is made. You should not rely on any
forward-looking statement as representing our views in the future.
We undertake no obligation to publicly update any forward-looking
statement, whether written or oral, that may be made from time to
time, whether as a result of new information, future developments
or otherwise.
Contact:
Health Insurance Innovations, Inc.: Mike DeVriesSVP Finance
(813) 906-5314 mdevries@hiiq.com
Health Insurance Innovat... (NASDAQ:HIIQ)
Gráfica de Acción Histórica
De May 2024 a Jun 2024
Health Insurance Innovat... (NASDAQ:HIIQ)
Gráfica de Acción Histórica
De Jun 2023 a Jun 2024