Resources Connection, Inc. provides agile consulting services in North America, Europe, and the Asia Pacific. The company offers finance and accounting services, including process transformation and optimization, financial reporting and analysis, technical and operational accounting, merger and acquisition due diligence and integration, audit readiness, preparation and response, implementation of new accounting standards, and remediation support. It also provides information management services, such as program and project management, business and technology integration, data strategy, and business performance management. In addition, the company offers corporate advisory, strategic communications, and restructuring services; and corporate governance, risk, and compliance management services, such as contract and regulatory compliance, enterprise risk management, internal controls management, and operation and information technology (IT) audits. Further, it provides supply chain management services comprising strategy development, procurement and supplier management, logistics and materials management, supply chain planning and forecasting, and unique device identification compliance; and human capital services, including change management, organization development and effectiveness, compensation and incentive plan strategies, and optimization of human resources technology and operations. Additionally, the company offers legal and regulatory supporting services for commercial transactions, global compliance initiatives, law department operations, and law department business strategies and analytics. It also provides policyIQ, a proprietary cloud-based governance, risk, and compliance software application. The company was formerly known as RC Transaction Corp. and changed its name to Resources Connection, Inc. in August 2000. Resources Connection, Inc. was founded in 1996 and is headquartered in Irvine, California.
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Initiating Research Coverage. We are initiating research coverage of Resources Connection, Inc. (RGP) with an Outperform rating and a $15 price target. We view RGP as a disruptor in the rapidly evolving management consulting field focused on improving outcomes for both its consulting clients as well as staff, be it internal or external.
Who Is Resources Connection? Resources Connection is a global consulting firm focused on project execution services that power clients’ operational needs and change initiatives utilizing on-demand, experienced, and diverse talent. As a next-generation human capital partner, RGP specializes in co-delivery of enterprise initiatives typically precipitated by business transformation, strategic transactions, or regulatory change.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
AI Adding to Growth. Total revenue for the first quarter was $30.3 million compared to $8.3 million in the prior year. This surpassed our $23.5 million estimate, as a higher bitcoin price and the Company’s inclusion of AI revenue led to the increase. The AI revenue comes from the Company’s anchor AI contract with expected annualized revenue of $50 million. We believe the AI contract provides an alternative revenue stream non-correlated to the cryptocurrency market.
Potential for More Soon. Although the $50 million contract is in place, earlier in the year Bit Digital received a proposal for an expansion of its contract. With the expansion, the proposal calls for an additional 2,048 GPUs on top of the 2,048 GPUs already in the contract, effectively doubling revenue to $100 million. The Company is currently in talks with the client on the terms of the expansion and we expect an announcement in the coming weeks.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
NEW YORK, May 15, 2024 /PRNewswire/ — Bit Digital, Inc. (Nasdaq: BTBT) (the “Company”), a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City, today announced its unaudited financial results for the First Quarter ended March 31, 2024.
Financial Highlights for the First Quarter of 2024
Total revenue was $30.3 million for the First Quarter of 2024, a 266% increase compared to the First Quarter of 2023. The increase was primarily driven by the commencement of our Bit Digital AI business and by a higher realized bitcoin price.
Revenue from bitcoin mining was $21.9 million for the First Quarter of 2024, a 166% increase compared to the prior year’s quarter. The Company’s Bit Digital AI business, referred to as High performance computing services (“HPC”), began generating revenue in January 2024, and recognized $8.1 million of revenue during the quarter. The Company issued a one-time service credit of $1.3 million to its HPC customer as compensation for decreased utilization during the initial deployment period, which included testing and optimization phases. Illustratively, adding back this credit would yield pro forma gross margins of approximately 72% on a net basis compared to reported gross margins of 61% for the segment. Revenue from ETH staking was approximately $0.3 million.
The Company had cash, cash equivalents and restricted cash of $35.5 million, and total liquidity (defined as cash equivalents and restricted cash, USDC, and the fair market value of digital assets) of approximately $163.21 million, as of March 31, 2024.
Total assets were $291.1 million and Shareholders’ Equity amounted to $265.2 million as of March 31, 2024.
Adjusted EBITDA2 was $58.5 million for the First Quarter of 2024 compared to $1.5 million for the First Quarter of 2023.
GAAP earnings per share was $0.43 on a fully-diluted basis for the First Quarter of 2024 compared to a loss of $0.03 for the First Quarter of 2023.
Operational Highlights for the First Quarter 2024
The Company earned 410.7 bitcoins during the First Quarter of 2024, a 13% increase from the prior year. Growth was primarily driven by a higher active hash rate and partially offset by an increase in network difficulty.
The Company paid approximately $0.05 per kilowatt hour to its hosting partners for electricity consumed during the First Quarter of 2024.
The average fleet efficiency for the active fleet was approximately 28.3 J/TH as of March 31, 2024.
The Company earned 111.1 ETH in native staking and 1.3 ETH in liquid staking, respectively, in the First Quarter of 2024.
Treasury holdings of BTC and ETH were 956.4 and 16,031.43, respectively, with a fair market value of approximately $68.2 million and $58.5 million on March 31, 2024, respectively.
The BTC equivalent4 of our digital asset holdings as of March 31, 2024 (defined as if all ETH and USDC holdings were converted into BTC as of that date) was approximately 1,790.0 BTC5, or approximately $127.7 million.
As of March 31, 2024, we had 48,898 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 4.2 EH/S.
The Company’s active hash rate of its bitcoin mining fleet was approximately 2.76 EH/s as of March 31, 2024.
The Company purchased approximately 2,350 bitcoin mining units during the First Quarter of 2024.
Approximately 85% of our fleet’s run-rate electricity consumption was generated from carbon-free energy sources as of March 31, 2024. These figures are based on data provided by our hosts, publicly available sources, and internal estimates, demonstrating our commitment to sustainable practices in the digital asset mining industry.
The Company had approximately 3,008 ETH actively staked in native staking protocols as of March 31, 2024. The decrease relative to the prior quarter was due to the Company changing its provider for native staking solutions. As of April 30, 2024, the Company had approximately 17,184 ETH actively staked in native staking protocols.
On January 22, 2024, approximately 192 servers (1,536 GPUs) began generating revenue from the Company’s AI customer contract. Subsequently, approximately 64 additional servers (512 GPUs) commenced revenue generation on February 2, 2024.
On January 26, 2024, the Company finalized an agreement with Coinmint for up to 6 MW of additional mining capacity at Coinmint’s hosting facility in Massena, New York. This new agreement brings the Company’s total contracted hosting capacity with Coinmint to approximately 46 MW.
Management Commentary
“Our First Quarter 2024 results represent a strong start to the year with revenue growing by more than 250% and GAAP Net Income in excess of $50 million. The primary drivers for the improved performance were the commencement of our Bit Digital AI business and a higher realized bitcoin price.
We were well prepared for the halving which occurred in April 2024. Our balance sheet remains a core strength with over $160 million of total liquidity as of March 31, 2024, zero debt, and a growing revenue stream that is not correlated to the economics of bitcoin mining. While we continue to evaluate the post-halving bitcoin mining landscape, our goal of reaching 6.0 EH/s this year remains intact. We are actively engaged in discussions for both incremental hosting opportunities and potential acquisitions.
We continue to believe that capital allocation optionality provided by our complementary business lines is a key differentiator for our Company. We are actively evaluating a number of growth opportunities, both organic and inorganic, across each of our business lines. We are in the late stages of finalizing an agreement to double the size of the GPU fleet for our anchor client and our negotiations with prospective clients are progressing well. Our target of reaching a $100 million annualized revenue run-rate by year-end for this segment remains intact.”
About Bit Digital
Bit Digital, Inc. is a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. The Company has established a business line, Bit Digital AI, that offers infrastructure services for artificial intelligence applications. For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.
Investor Notice
Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 3.D of our Annual Report on Form 20-F for the fiscal year ended December 31, 2023. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital’s production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors. See “Safe Harbor Statement” below.
Safe Harbor Statement
This press release may contain certain “forward-looking statements” relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
Footnotes:
1 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.
2 Adjusted EBITDA refers to earnings before interest expense, income tax expense and depreciation and amortization expense (“EBITDA”) adjusted to eliminate the effects of certain non-cash and / or non-recurring items.
3 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.
4 “BTC equivalent” is a hypothetical illustration of the value of our digital asset portfolio in bitcoin terms. BTC equivalent is defined as if all non-BTC digital assets, comprised of ETH and USDC, were converted into BTC as of March 31, 2024, and added to our existing BTC balance. Conversion values are found using the closing price on coinmarketcap.com.
5 This figure excludes approximately 2,701 ETH that were transferred to an internally managed fund.
Joe Gomes, CFA, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Guided by AI. Total revenue for the Company grew 266% y-o-y, driven by higher realized bitcoin price and from the Company’s AI business. The Company recognized $8.1 million of revenue during the quarter and reported a gross margin of 61%. With the potential increase of the segment’s AI contract earlier in the year, we expect the performance of the segment to rival its mining revenue in the coming quarters.
Mining Side. Bit Digital’s bitcoin mining revenue was $21.9 million, a 168% increase from the previous year, as a higher hash rate coupled with the higher bitcoin price drove the revenue. As noted in our previous report, the active hash rate was 2.76 EH/s as of April 30, 2024. The Company has a total of 48,898 miners owned or operating for a total maximum hash rate of 4.2 EH/s. We believe the Company is well on its way towards its active hash goal of 6.0 EH/s.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
A transitional quarter. The company reported Q1 revenue of $138.5 million, down 15% year over year, but beating our estimate of $134.7 million. Adj. EBITDA in the quarter was $4.9 million, higher than our estimate of $4.0 million. The results reflected redeployment of kiosks and lowered results in California due to unfavorable legislation.
Favorable kiosk growth. We believe that the company is setting the stage for accelerated revenue and cash flow growth through the deployment of kiosks. In Q1, the company increased the number of deployed kiosks by roughly 700. Post Q1, the company announced the purchase of approximately 2,300 Bitcoin kiosks at a sizeable discount of roughly 50% per-kiosk. The purchase brings the number of kiosks owned by the company to over 10,000, of which 7,061 were deployed, as of the end of Q1.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Strengthens Footprint with Over 2,000 New Retail Locations Signed in the First Quarter of 2024
Committed to Acquire Approximately 3,200 Additional Kiosks Year-to-Date to Support Expansion Strategy
Remains on Track to Deploy 8,000 Kiosks by the End of 2024
ATLANTA, May 14, 2024 (GLOBE NEWSWIRE) — Bitcoin Depot Inc. (“Bitcoin Depot” or the “Company”), a U.S.-based Bitcoin ATM operator and leading fintech company, today reported financial results for the first quarter ended March 31, 2024. Bitcoin Depot will host a conference call and webcast at 10:00 a.m. ET today. An earnings presentation and link to the webcast will be made available at ir.bitcoindepot.com.
“Bitcoin Depot’s momentum continued in the first quarter as we fortified our industry-leading market share, expanded our footprint to new geographies, and purchased thousands of kiosks for our future growth plans,” said Brandon Mintz, CEO and Founder of Bitcoin Depot. “We plan to continue our expansion of our total operating fleet size and are on track to reach our goal of 8,000 Bitcoin ATMs installed by the end of 2024 ahead of schedule after signing over 2,000 new retail locations during the first quarter. Our strategic expansion into Puerto Rico and Australia marks a significant step toward our goal of bringing Bitcoin to the masses and establishing a market-leading presence outside of North America. Looking ahead, we remain well-positioned to execute our strategic goals this year as the world’s leading Bitcoin ATM network while continuing to optimize the business for maximum profitability ahead.”
First Quarter 2024 Financial Results
Revenue in the first quarter of 2024 was $138.5 million, down 15% from $163.6 million in the first quarter of 2023.
Gross Profit in the first quarter of 2024 was $14.4 million, down 26% from $19.5 million for the first quarter of 2023. Gross Profit margin in the first quarter of 2024 was 10.4% compared to 11.9% in the first quarter of 2023.
Total operating expenses were $16.6 million for the first quarter of 2024, compared to $13.6 million for the first quarter of 2023.
Net loss for the first quarter of 2024 was $4.2 million, compared to net income of $6.1 million for the first quarter of 2023.
Adjusted EBITDA, a non-GAAP measure, in the first quarter of 2024 was $4.9 million, compared to Adjusted EBITDA of $13.6 million for the first quarter of 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Trailing Twelve Months Ended March 31, 2024
Revenue during the trailing twelve months ended March 31, 2024 was $663.9 million, up 1% from $655.9 million compared to the twelve months ended March 31, 2023.
Gross Profit in the twelve months ended March 31, 2024 was $83.4 million, up 29% from $64.6 million compared to the twelve months ended March 31, 2023. Gross Profit margin in the twelve months ended March 31, 2024 was 12.6% compared to 9.8% in the twelve months ended March 31, 2023.
Total operating expenses were $73.5 million for the twelve months ended March 31, 2024, compared to $56.9 million for the twelve months ended March 31, 2023.
Net loss for the twelve months ended March 31, 2024 was $8.8 million, compared to net income of $13.0 million for the twelve months ended March 31, 2023.
Adjusted EBITDA, a non-GAAP measure, in the twelve months ended March 31, 2024 was $47.6 million, compared to Adjusted EBITDA of $49.5 million for the twelve months ended March 31, 2023. Please see “Explanation and Reconciliation of Non-GAAP Financial Measures” below.
Cash and cash equivalents were $42.2 million as of the end of the first quarter of 2024.
Recent Business Highlights
Bitcoin Depot continued to strengthen its industry-leading market share with 7,061 kiosk locations and 6,734 BDCheckout locations at the end of 1Q24
Announced sales team expansion and ordered approximately 3,200 kiosks year-to-date to meet the growing demand from retailers and to support bold expansion strategy
Announced over 2,000 new retail locations signed in 1Q24 spanning across several states to increase Bitcoin Depot’s fleet of deployed kiosks and support ambitious goal of deploying 8,000 Bitcoin ATMs by year-end
Strengthened profit share program through signed partnerships with Sopris Capital and an investment fund. Through the profit share program, Bitcoin Depot has already added more than 300 additional BTM kiosk locations in 2024
Expanded footprint internationally into Puerto Rico and Australia
Signed first major grocery store partnership with Fareway across 66 locations
Conference Call
Bitcoin Depot will hold a conference call at 10:00 a.m., Eastern time (7:00 a.m. Pacific time), today to discuss its financial results for the first quarter ended March 31, 2024.
Call Date: Tuesday, May 14, 2024 Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time) U.S. dial-in: 646-968-2525 International dial-in: 888-596-4144 Conference ID: 1037410
The conference call will broadcast live and be available for replay here following the call.
Please call the conference telephone number approximately 10 minutes before the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Bitcoin Depot’s investor relations team at 1-949-574-3860.
A replay of the call will be available beginning after 2:00 p.m. Eastern time on May 14, 2024 through May 21, 2024.
U.S. replay number: 609-800-9909 International replay number: 800-770-2030 Conference ID: 1037410
About Bitcoin Depot
Bitcoin Depot Inc. (Nasdaq: BTM) was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to bitcoin at Bitcoin Depot kiosks in 49 states and at thousands of name-brand retail locations in 29 states through its BDCheckout product. The Company has the largest market share in North America with approximately 7,100 kiosk locations as of April 1, 2024. Learn more at www.bitcoindepot.com.
This press release and any oral statements made in connection herewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, and include, but are not limited to, statements regarding the expectations of plans, business strategies, objectives and growth and anticipated financial and operational performance, including our growth strategy and ability to increase deployment of our products and services, our ability to strengthen our financial profile, and worldwide growth in the adoption and use of cryptocurrencies,. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Forward-looking statements are often identified by words such as “anticipate,” “appears,” “approximately,” “believe,” “continue,” “could,” “designed,” “effect,” “estimate,” “evaluate,” “expect,” “forecast,” “goal,” “initiative,” “intend,” “may,” “objective,” “outlook,“ ”plan,“ ”potential,“ ”priorities,“ ”project,“ ”pursue,“ ”seek,“ ”should,“ ”target,“ ”when,“ ”will,“ ”would,” or the negative of any of those words or similar expressions that predict or indicate future events or trends or that are not statements of historical matters, although not all forward-looking statements contain such identifying words. In making these statements, we rely upon assumptions and analysis based on our experience and perception of historical trends, current conditions, and expected future developments, as well as other factors we consider appropriate under the circumstances. We believe these judgments are reasonable, but these statements are not guarantees of any future events or financial results. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond our control.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination; risks relating to the uncertainty of our projected financial information; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; our ability to manage future growth; our ability to develop new products and services, bring them to market in a timely manner and make enhancements to our platform; the effects of competition on our future business; our ability to issue equity or equity-linked securities; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors described or referenced in filings with the Securities and Exchange Commission. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that we do not presently know or that we currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect our expectations, plans or forecasts of future events and views as of the date of this press release. We anticipate that subsequent events and developments will cause our assessments to change.
We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or otherwise revise any forward-looking statements, whether as a result of new information, future events, or other factors that affect the subject of these statements, except where we are expressly required to do so by law. All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement.
Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Impressive results. The company reported fiscal Q3 revenue of $376.4 million, beating our estimate of $341.8 million. Adj. EBITDA in the quarter was $46.6 million, also beating our estimate, which was $40.3 million. The robust 26% revenue growth was driven primarily by Pharmacy revenue, which grew 80% over the prior year period.
Strong OEP. Revenue from the Senior segment was 20% better than our estimate, indicating a favorable Medicare Advantage Open Enrollment Period for the company. Notably, Senior segment adj. EBITDA margins were 30% in the quarter.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
Patrick McCann, CFA, Research Analyst, Noble Capital Markets, Inc.
Michael Kupinski, Director of Research, Equity Research Analyst, Digital, Media & Technology , Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Q1 results. The company reported Q1 revenue of $185.6 million, in line with our estimate of $183.0 million. Adj. EBITDA of $26.9 million was below our forecast of $30.4 million. Management indicated that market dynamics in Q1, which featured the Medicare Advantage Open Enrollment Period, were fairly consistent with the Annual Enrollment Period in Q4.
Demonstrating model integrity. During the quarter, the company reaffirmed 94,000 health insurance policies, even though such outcomes do not generate incremental revenue for the company. In our view, this serves to highlight the company’s commitment to putting the consumer first and we believe the company could be rewarded for this in the long run.
Equity Research is available at no cost to Registered users of Channelchek. Not a Member? Click ‘Join’ to join the Channelchek Community. There is no cost to register, and we never collect credit card information.
This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
PHOENIX, May 09, 2024 (GLOBE NEWSWIRE) — QuoteMedia, a leading financial market data and financial technology solutions provider, continues to expand their global data offerings by adding support for the Cboe One Canada Feed, a real-time Canadian equities market data solution offered by Cboe Global Markets. The Feed aims to provide complete coverage of the Canadian equities market by aggregating data from all four trading venues operated by Cboe Canada and trading volume from all Canadian markets. Notably, it also includes unique coverage of more than 260 securities that are listed on Cboe Canada.
“We are thrilled to announce our support for the Cboe One Canada Feed, further enhancing our range of exchange price feeds available to our clients,” said Dave Shworan, CEO of QuoteMedia Ltd. “This collaboration enables us to offer more options for accessing reliable real-time market data, empowering investors to make informed decisions.”
Cboe Canada is the third most active marketplace in Canada, consistently representing close to 15% of all volume traded in Canadian-listed securities. The Cboe One Canada Feed will be integrated across all QuoteMedia enterprise and subscription products, giving users the flexibility to choose from a variety of exchange price feeds that best suit their needs.
“Cboe aims to deliver world-class solutions and services across all the markets in which we operate globally, and our dedication to Canada is no exception,” said Adam Inzirillo, Global Head of Data and Access Solutions at Cboe Global Markets. “Our Cboe One Canada Feed is designed to offer seamless and efficient access to data on all Canadian-listed securities, reflecting our commitment to driving continuous product innovation within this market, and we couldn’t be more pleased to collaborate with QuoteMedia to broaden market data accessibility for the industry.”
About QuoteMedia QuoteMedia is a leading software developer and cloud-based syndicator of financial market information and streaming financial data solutions to media, corporations, online brokerages, and financial services companies. The Company licenses interactive stock research tools such as streaming real-time quotes, market research, news, charting, option chains, filings, corporate financials, insider reports, market indices, portfolio management systems, and data feeds. QuoteMedia provides industry leading market data solutions and financial services for companies such as the Nasdaq Stock Exchange, TMX Group (TSX Stock Exchange), Canadian Securities Exchange (CSE), London Stock Exchange Group, FIS, U.S. Bank, Bank of Montreal (BMO), Broadridge Financial Systems, JPMorgan Chase, Scotiabank, CI Financial, Canaccord Genuity Corp., Hilltop Securities, Avantax, Zacks Investment Research, General Electric, Boeing, Bombardier, Telus International, Business Wire, PR Newswire, The Goldman Sachs Group, Regal Securities, ChoiceTrade, Cetera Financial Group, Dynamic Trend, Inc., Aviso Financial Inc., CNW Group, iA Private Wealth, Ally Invest, Inc., Suncor, Leede Jones Gable, Firstrade Securities, Charles Schwab, First Financial, Equisolve, Stock-Trak, Mergent, Cision and others. For more information, please visit www.quotemedia.com.
Third Quarter of Fiscal Year 2024 – Consolidated Earnings Highlights
Revenue of $376.4 million
Net income of $8.6 million
Adjusted EBITDA* of $46.6 million
Raising Fiscal Year 2024 Guidance Ranges:
Revenue expected in a range of $1.25 billion to $1.3 billion vs prior range of $1.23 billion to $1.3 billion
Net loss expected in a range of $34 million to $21 million vs prior range of $45 million to $22 million
Adjusted EBITDA* expected in a range of $100 million to $110 million vs prior range of $90 million to $105 million
Third Quarter of Fiscal Year 2024 – Segment Highlights
Senior
Revenue of $204.3 million
Adjusted EBITDA* of $61.5 million
Approved Medicare Advantage policies of 185,716
Healthcare Services
Revenue of $124.2 million
Adjusted EBITDA* of $1.6 million
Over 75,000 SelectRx members
Life
Revenue of $40.7 million
Adjusted EBITDA* of $3.1 million
Auto & Home
Revenue of $9.1 million
Adjusted EBITDA* of $3.6 million
OVERLAND PARK, Kan.–(BUSINESS WIRE)– SelectQuote, Inc. (NYSE: SLQT) reported consolidated revenue for the third quarter of fiscal year 2024 of $376.4 million, compared to consolidated revenue for the third quarter of fiscal year 2023 of $299.4 million. Consolidated net income for the third quarter of fiscal year 2024 was $8.6 million, compared to consolidated net income for the third quarter of fiscal year 2023 of $9.3 million. Finally, consolidated Adjusted EBITDA* for the third quarter of fiscal year 2024 was $46.6 million, compared to consolidated Adjusted EBITDA* for the third quarter of fiscal year 2023 of $44.0 million.
Chief Executive Officer Tim Danker commented, “SelectQuote outperformed our own expectations for the 9th consecutive quarter, and the company has never been better positioned to drive shareholder value. We firmly believe SelectQuote can amplify the strong operating results achieved over the past two years since our foundational strategic redesign.”
“Our Senior business completed another highly successful Medicare Advantage busy season in the quarter, which produced stable and attractive economics across both policy growth, LTV expansion, and operating efficiency. The segment’s core tenured agents helped over 185,000 Americans find the right Medicare Advantage policy and did so with strong overall cost per policy and efficient close rates, which drove a Senior Adjusted EBITDA margin above 30% in one of our highest open enrollment period (OEP) quarters for revenue in company history. The success in our Senior business also enhanced the continued expansion of our Healthcare Services business, which saw SelectRx grow by over 12,000 members, significantly exceeding our original outlook. Overall, our holistic healthcare platform created new customers at a highly efficient revenue to customer acquisition cost of over 4x, which will drive significant Adjusted EBITDA contribution as Healthcare Services continues to scale.”
Mr. Danker concluded, “The teams at SelectQuote and our leadership are energized about the successes experienced year-to-date. We have conviction that 2024 will prove to be an inflection point in our company’s history, and SelectQuote is poised to leverage our unique healthcare platform to drive attractive returns for our shareholders in the quarters and years ahead.”
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, Adjusted EBITDA,* and Adjusted EBITDA Margin.* 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.
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)
2024
2023
% Change
2024
2023
% Change
Revenue
$
204,259
$
185,200
10
%
$
541,705
$
486,541
11
%
Adjusted EBITDA*
61,494
59,166
4
%
138,871
138,933
—
%
Adjusted EBITDA Margin*
30
%
32
%
26
%
29
%
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:
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
226,692
196,372
15
%
602,936
538,247
12
%
Medicare Supplement
650
675
(4
)%
2,334
2,905
(20
)%
Dental, Vision and Hearing
16,588
21,175
(22
)%
48,892
59,513
(18
)%
Prescription Drug Plan
665
416
60
%
2,696
2,082
29
%
Other
774
1,864
(58
)%
3,724
5,402
(31
)%
Total
245,369
220,502
11
%
660,582
608,149
9
%
*See “Non-GAAP Financial Measures” below.
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,
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
185,716
165,530
12
%
517,973
467,540
11
%
Medicare Supplement
445
557
(20
)%
1,578
2,184
(28
)%
Dental, Vision and Hearing
14,042
16,968
(17
)%
41,474
47,940
(13
)%
Prescription Drug Plan
1,114
521
114
%
2,684
1,794
50
%
Other
789
1,029
(23
)%
2,834
3,932
(28
)%
Total
202,106
184,605
9
%
566,543
523,390
8
%
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):
2024
2023
% Change
2024
2023
% Change
Medicare Advantage
$
995
$
965
3
%
$
923
$
888
4
%
Medicare Supplement
1,271
871
46
%
1,108
994
11
%
Dental, Vision and Hearing
101
91
11
%
100
95
5
%
Prescription Drug Plan
237
194
22
%
237
211
12
%
Other
36
123
(71
)%
(3
)
100
(103
)%
Healthcare Services
Financial Results
The following table provides the financial results for the Healthcare Services segment for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
(in thousands)
2024
2023
% Change
2024
2023
% Change
Revenue
$
124,207
$
70,725
76
%
$
333,284
$
169,270
97
%
Adjusted EBITDA*
1,609
(3,366
)
148
%
6,911
(24,456
)
128
%
Adjusted EBITDA Margin*
1
%
(5
)%
2
%
(14
)%
*See “Non-GAAP Financial Measures” below.
Operating Metrics
Total Members
The total number of SelectRx members represents the amount of 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 for the date presented:
March 31, 2024
March 31, 2023
Total SelectRx Members
75,074
44,993
Prescriptions Per Day
Prescriptions per day represents the total average prescriptions shipped per business day, as this is a primary key driver of revenue for Healthcare Services.
The following table shows the prescriptions shipped per day for the periods presented:
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
2024
2023
Prescriptions Per Day
20,216
11,737
17,582
9,753
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 costs, 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.
Twelve Months Ended March 31,
(dollars per approved policy):
2024
2023
Medicare Advantage and Medicare Supplement approved policies
630,013
586,238
Medicare Advantage and Medicare Supplement commission per MA/MS policy
$
907
$
886
Other commission per MA/MS policy
10
15
Pharmacy revenue per MA/MS policy
641
320
Other revenue per MA/MS policy
126
66
Total revenue per MA/MS policy
1,684
1,287
Total operating expenses per MA/MS policy
(1,425
)
(1,167
)
Adjusted EBITDA per MA/MS policy (1)
$
259
$
120
Adjusted EBITDA Margin per MA/MS policy (1)
15
%
9
%
Revenue/CAC multiple
4.2
X
3.5
X
(1) These financial measures are not calculated in accordance with GAAP. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures” in the Company’s Quarterly Report on Form 10-Q for information regarding our use of these non-GAAP financial measures and a reconciliation of such measures to their nearest comparable financial measures calculated and presented in accordance with GAAP.
Total revenue per MA/MS policy increased 31% for the twelve months ended March 31, 2024, compared to the twelve months ended March 31, 2023, primarily due to the increase in pharmacy revenue. Total operating expenses per MA/MS policy increased 22% for the twelve months ended March 31, 2024, compared to the twelve months ended March 31, 2023, primarily driven by increase in cost of goods sold-pharmacy revenue for SelectRx due to the growth of the business.
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)
2024
2023
% Change
2024
2023
% Change
Revenue
$
40,686
$
36,950
10
%
$
115,855
$
107,780
7
%
Adjusted EBITDA*
3,138
5,303
(41
)%
12,945
16,371
(21
)%
Adjusted EBITDA Margin*
8
%
14
%
11
%
15
%
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.
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)
2024
2023
% Change
2024
2023
% Change
Term Premiums
$
16,788
$
17,512
(4
)%
$
52,376
$
48,433
8
%
Final Expense Premiums
23,724
19,308
23
%
62,811
58,766
7
%
Total
$
40,512
$
36,820
10
%
115,187
107,199
7
%
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)
2024
2023
% Change
2024
2023
% Change
Revenue
$
9,134
$
8,238
11
%
$
28,649
$
23,128
24
%
Adjusted EBITDA*
3,609
2,591
39
%
11,654
7,315
59
%
Adjusted EBITDA Margin*
40
%
31
%
41
%
32
%
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):
2024
2023
% Change
2024
2023
% Change
Premiums
$
14,180
$
12,828
11
%
$
42,746
$
36,456
17
%
Amendment to Credit Agreement
On May 8, 2024, the Company and its lenders agreed to amend the Company’s credit agreement to extend the maturity date with respect to $683.8 million of extended term loans from February 15, 2025 to May 15, 2025. The amendment also provides for a minimum asset coverage ratio and minimum liquidity requirements for the extension period. Additional information regarding the amendment will be included in the Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2024.
Earnings Conference Call
SelectQuote, Inc. will host a conference call with the investment community today, Thursday, May 9, 2024, beginning at 9:00 a.m. ET. To register for this conference call, please use this link: https://www.netroadshow.com/events/login?show=2a79382d&confId=63927. 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.
*See “Non-GAAP Financial Measures” below.
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 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 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 the differences between the non-GAAP financial measures included herein and their most directly comparable GAAP financial measures are set forth 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 impacts of the 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 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 and meet our scheduled repayment obligations under our debt arrangements; our ability to access additional capital on acceptable terms; 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; failure to market and sell Medicare plans effectively or in compliance with laws; and other factors related to our pharmacy business, including manufacturing or supply chain disruptions, access to and demand for prescription drugs, and regulatory changes or other industry developments that may affect our pharmacy operations. 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 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 Patient-Centered Pharmacy Home™ (PCPH) accredited pharmacy, and Population Health, which proactively connects consumers with a wide breadth of healthcare services supporting their needs..
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)(In thousands)
March 31, 2024
June 30, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
37,808
$
83,156
Accounts receivable, net of allowances of $6.5 million and $2.7 million, respectively
253,083
154,565
Commissions receivable-current
69,165
111,148
Other current assets
24,115
14,355
Total current assets
384,171
363,224
COMMISSIONS RECEIVABLE—Net
763,958
729,350
PROPERTY AND EQUIPMENT—Net
22,536
27,452
SOFTWARE—Net
13,952
14,740
OPERATING LEASE RIGHT-OF-USE ASSETS
19,341
23,563
INTANGIBLE ASSETS—Net
7,926
10,200
GOODWILL
29,136
29,136
OTHER ASSETS
4,119
21,586
TOTAL ASSETS
$
1,245,139
$
1,219,251
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable
$
61,168
$
27,577
Accrued expenses
21,058
16,993
Accrued compensation and benefits
57,483
49,966
Operating lease liabilities—current
4,663
5,175
Current portion of long-term debt
37,717
33,883
Contract liabilities
3,655
1,691
Other current liabilities
4,227
1,972
Total current liabilities
189,971
137,257
LONG-TERM DEBT, NET—less current portion
648,331
664,625
DEFERRED INCOME TAXES
35,057
39,581
OPERATING LEASE LIABILITIES
22,326
27,892
OTHER LIABILITIES
2,649
2,926
Total liabilities
898,334
872,281
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value
1,692
1,669
Additional paid-in capital
577,389
567,266
Accumulated deficit
(238,752
)
(235,644
)
Accumulated other comprehensive income
6,476
13,679
Total shareholders’ equity
346,805
346,970
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
$
1,245,139
$
1,219,251
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS(Unaudited)(In thousands)
Three Months Ended March 31,
Nine Months Ended March 31,
2024
2023
2024
2023
REVENUE:
Commission
$
230,763
$
197,258
$
611,744
533,627
Pharmacy
120,282
66,948
323,865
159,641
Other
25,355
35,192
78,958
87,802
Total revenue
376,400
299,398
1,014,567
781,070
OPERATING COSTS AND EXPENSES:
Cost of revenue
84,315
79,186
254,250
235,827
Cost of goods sold—pharmacy revenue
106,172
62,302
284,360
154,753
Marketing and advertising
109,276
90,205
288,676
237,724
Selling, general, and administrative
34,971
27,544
97,049
86,662
Technical development
8,604
6,434
24,291
18,860
Total operating costs and expenses
343,338
265,671
948,626
733,826
INCOME FROM OPERATIONS
33,062
33,727
65,941
47,244
INTEREST EXPENSE, NET
(24,330
)
(21,105
)
(70,141
)
(58,885
)
OTHER INCOME (EXPENSE,) NET
(12
)
(206
)
(51
)
(118
)
INCOME (LOSS) BEFORE INCOME TAX EXPENSE (BENEFIT)
8,720
12,416
(4,251
)
(11,759
)
INCOME TAX EXPENSE (BENEFIT)
169
3,152
(1,143
)
(1,053
)
NET INCOME (LOSS)
$
8,551
$
9,264
$
(3,108
)
(10,706
)
NET INCOME (LOSS) PER SHARE:
Basic
$
0.05
$
0.06
$
(0.02
)
$
(0.06
)
Diluted
$
0.05
$
0.06
$
(0.02
)
$
(0.06
)
WEIGHTED-AVERAGE COMMON STOCK OUTSTANDING USED IN PER SHARE AMOUNTS:
Basic
169,070
166,543
168,291
165,951
Diluted
170,956
167,905
168,291
165,951
OTHER COMPREHENSIVE INCOME (LOSS) NET OF TAX:
Gain (loss) on cash flow hedge
(1,771
)
(2,661
)
(7,203
)
1,358
OTHER COMPREHENSIVE INCOME (LOSS)
(1,771
)
(2,661
)
(7,203
)
1,358
COMPREHENSIVE INCOME (LOSS)
$
6,780
$
6,603
$
(10,311
)
$
(9,348
)
SELECTQUOTE, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)(In thousands)
Nine Months Ended March 31,
2024
2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss
$
(3,108
)
$
(10,706
)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization
18,591
21,087
Loss on disposal of property, equipment, and software
13
390
Share-based compensation expense
10,512
8,525
Deferred income taxes
(2,151
)
(1,416
)
Amortization of debt issuance costs and debt discount
4,863
6,250
Write-off of debt issuance costs
293
710
Accrued interest payable in kind
14,323
8,450
Non-cash lease expense
1,945
3,115
Changes in operating assets and liabilities:
Accounts receivable, net
(98,519
)
(62,738
)
Commissions receivable
7,375
17,092
Other assets
(2,620
)
3,166
Accounts payable and accrued expenses
36,073
6,440
Operating lease liabilities
(3,802
)
(4,331
)
Other liabilities
11,453
(8,869
)
Net cash used in operating activities
(4,759
)
(12,835
)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment
(3,114
)
(1,056
)
Proceeds from sales of property and equipment
253
—
Purchases of software and capitalized software development costs
(6,065
)
(5,804
)
Net cash used in investing activities
(8,926
)
(6,860
)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on Term Loans
(30,412
)
(17,833
)
Payments on other debt
(112
)
(123
)
Proceeds from common stock options exercised and employee stock purchase plan
8
1,187
Payments of tax withholdings related to net share settlement of equity awards
(374
)
(40
)
Payments of debt issuance costs
(773
)
(10,110
)
Payment of acquisition holdback
—
(2,335
)
Net cash used in financing activities
(31,663
)
(29,254
)
NET DECREASE IN CASH AND CASH EQUIVALENTS
(45,348
)
(48,949
)
CASH AND CASH EQUIVALENTS—Beginning of period
83,156
140,997
CASH AND CASH EQUIVALENTS—End of period
$
37,808
$
92,048
SELECTQUOTE, INC. AND SUBSIDIARIESNet Income (Loss) to Adjusted EBITDA Reconciliation(Unaudited)
Three Months Ended March 31, 2024
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
204,259
$
124,207
$
40,686
$
9,134
$
(1,886
)
$
376,400
Operating expenses
(142,765
)
(122,598
)
(37,548
)
(5,524
)
(21,355
)
(329,790
)
Other income (expense), net
—
—
—
(1
)
(11
)
(12
)
Adjusted EBITDA
$
61,494
$
1,609
$
3,138
$
3,609
$
(23,252
)
$
46,598
Share-based compensation expense
(3,515
)
Transaction costs
(3,325
)
Depreciation and amortization
(6,704
)
Loss on disposal of property, equipment, and software
(4
)
Interest expense, net
(24,330
)
Income tax expense
(169
)
Net income
$
8,551
Three Months Ended March 31, 2023
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
185,200
$
70,725
$
36,950
$
8,238
$
(1,715
)
$
299,398
Operating expenses
(126,034
)
(74,091
)
(31,446
)
(5,648
)
(17,947
)
(255,166
)
Other income (expense), net
—
—
(201
)
1
(6
)
(206
)
Adjusted EBITDA
$
59,166
$
(3,366
)
$
5,303
$
2,591
$
(19,668
)
$
44,026
Share-based compensation expense
(2,959
)
Transaction costs
(433
)
Depreciation and amortization
(7,098
)
Loss on disposal of property, equipment, and software
(15
)
Interest expense, net
(21,105
)
Income tax expense
(3,152
)
Net income
$
9,264
Nine Months Ended March 31, 2024
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
541,705
$
333,284
$
115,855
$
28,649
$
(4,926
)
$
1,014,567
Operating expenses
(402,834
)
(326,373
)
(102,910
)
(16,994
)
(62,770
)
(911,881
)
Other income (expense), net
—
—
—
(1
)
(50
)
(51
)
Adjusted EBITDA
$
138,871
$
6,911
$
12,945
$
11,654
$
(67,746
)
$
102,635
Share-based compensation expense
(10,512
)
Transaction costs
(7,629
)
Depreciation and amortization
(18,591
)
Loss on disposal of property, equipment, and software
(13
)
Interest expense, net
(70,141
)
Income tax benefit
1,143
Net loss
$
(3,108
)
Nine Months Ended March 31, 2023
(in thousands)
Senior
Healthcare Services
Life
Auto & Home
Corp & Elims
Consolidated
Revenue
$
486,541
$
169,270
$
107,780
$
23,128
$
(5,649
)
$
781,070
Operating expenses
(347,608
)
(193,726
)
(91,409
)
(15,812
)
(52,270
)
(700,825
)
Other income (expense), net
—
—
—
(1
)
(117
)
(118
)
Adjusted EBITDA
$
138,933
$
(24,456
)
$
16,371
$
7,315
$
(58,036
)
$
80,127
Share-based compensation expense
(8,525
)
Transaction costs
(3,003
)
Depreciation and amortization
(21,087
)
Loss on disposal of property, equipment, and software
(386
)
Interest expense, net
(58,885
)
Income tax benefit
1,053
Net loss
$
(10,706
)
SELECTQUOTE, INC. AND SUBSIDIARIESNet Loss to Adjusted EBITDA Reconciliation(Unaudited)
Guidance net loss to Adjusted EBITDA reconciliation, year ending June 30, 2024:
NEW YORK, May 8, 2024 /PRNewswire/ — Bit Digital, Inc. (Nasdaq: BTBT) (“Bit Digital” or the “Company”), a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York, announced today that it will release its First Quarter 2024 results on Wednesday, May 15, 2024, after the stock market closes. Senior management will host a live webcast and conference call to review the results on Thursday, May 16, 2024, at 10 a.m. ET.
To register for the earnings call, please click here. Additionally, participants can join the conference call by dialing 1-855-303-0072 (passcode: 951267).
The Company will issue a press release regarding First Quarter 2024 earnings prior to the conference call. The press release will be posted on the Bit Digital website at www.bit-digital.com.
About Bit Digital
Bit Digital, Inc. is a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. The Company has established a business line, Bit Digital AI, that offers specialized cloud-infrastructure services for artificial intelligence applications. For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.
Investor Notice
Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 3.D of our most recent Annual Report on Form 20-F for the fiscal year ended December 31, 2023. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital’s production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors.
Safe Harbor Statement
This press release may contain certain “forward-looking statements” relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
NEW YORK, May 6, 2024 /PRNewswire/ — Bit Digital, Inc. (Nasdaq: BTBT) (“Bit Digital” or the “Company”), a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York, announced its unaudited digital asset production and corporate updates for the month of April 2024.
Corporate Highlights for April 2024
In April 2024, the Company produced 119.3 BTC, a 12.5% decrease compared to the prior month. The decrease relative to the prior month was predominantly due to the reduction of bitcoin block rewards post-halving.
The Company’s active hash rate was approximately 2.76 EH/s as of April 30, 2024.
Treasury holdings1 of BTC and ETH were 992.4 and 20,241.7 with a fair market value of approximately $60.2 million and $61.0 million, respectively, on April 30, 2024.
The BTC equivalent2 of our digital asset holdings as of April 30, 2024, was approximately 2,010.1 or approximately $121.9 million.
The Company had cash and cash equivalents of $43.7 million as of April 30, 2024.
Bit Digital AI Update
As of April 30, 2024, the Company had 251 servers actively generating revenue from its initial Bit Digital AI contract. The Company earned an estimated $4.1 million of unaudited revenue from this contract during the month of April 2024.
Proof-of-Stake Highlights
The Company had approximately 17,184 ETH actively staked in native staking protocols as of April 30, 2024.
Bit Digital earned a blended APY of approximately 1.0% on its staked ETH position for the month of April 2024. The decrease in yield was due to the lag time in redeploying its staked ETH after changing its provider for native staking solutions.
The Company earned aggregate staking rewards of approximately 13.9 ETH during April 2024.
About Bit Digital
Bit Digital, Inc. is a sustainable platform for digital assets and artificial intelligence (“AI”) infrastructure headquartered in New York City. Our bitcoin mining operations are located in the US, Canada, and Iceland. The Company has established a business line, Bit Digital AI, that offers specialized cloud-infrastructure services for artificial intelligence applications. For additional information, please contact ir@bit-digital.com or visit our website at www.bit-digital.com.
Investor Notice
Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under “Risk Factors” in Item 3.D of our most recent Annual Report on Form 20-F for the fiscal year ended December 31, 2023. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or bitcoin hash rate may also materially affect the future performance of Bit Digital’s production of bitcoin. Actual operating results will vary depending on many factors including network difficulty rate, total hash rate of the network, the operations of our facilities, the status of our miners, and other factors.
Safe Harbor Statement
This press release may contain certain “forward-looking statements” relating to the business of Bit Digital, Inc., and its subsidiary companies. All statements, other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects,” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
Footnotes:
1 “Treasury holdings” excludes approximately 2,701 ETH that were transferred to an internally managed fund.
2 “BTC equivalent” is a hypothetical illustration of the value of our digital asset portfolio in bitcoin terms. BTC equivalent is defined as if all non-BTC digital assets, comprised of ETH, and USDC, were converted into BTC as of April 30, 2024, and added to our existing BTC balance. Conversion values are found using the closing price on coinmarketcap.com.
Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.
Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.
Refer to the full report for the price target, fundamental analysis, and rating.
Bitcoin Mining. For the month of April, Bit Digital produced 119.3 BTC, a 12.5% decrease from last month’s 136.4 BTC. The decrease was primarily due to the reduction of bitcoin block rewards post-halving, which we believe we’ll continue to see a lower production rate until more miners are potentially up and running. The active hash rate was approximately 2.76 EH/s as of April 30, 2024, compared to 2.73 EH/s last month.
AI and ETH Staking. Bit Digital had 251 servers running on its AI contract and earned an estimated $4.1 million in unaudited revenue during the month. The Company had approximately 17,184 ETH actively staked in native staking compared to 3,008 ETH last month. This is due to the Company changing providers last month for its native staking solutions. The Company earned a blended APY of approximately 1.0% on its staked ETH position versus 2.8% last month, with the decrease due to the lag time in redeploying its staked ETH after changing providers.
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This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).
*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision.
