UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 16, 2023
_________________________
(Exact name of registrant as specified in its charter)
_________________________
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
(312 ) 386-8200
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
_________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425). | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12). | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)). | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)). | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
$0.0001 par value per share | ||||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On March 16, 2023 , GoHealth, Inc. issued a press release announcing its financial results for the year ended December 31, 2022. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information furnished pursuant to this Item 2.02 and Exhibit 99.1 attached hereto shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act except as shall be expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit Number | Exhibit Description | |||||||
| 99.1 | ||||||||
| 104 | Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| GoHealth, Inc. (Registrant) | |||||||||||
| Date: | By: | /s/ Jason Schulz | |||||||||
Jason Schulz Chief Financial Officer (Principal Financial and Accounting Officer) | |||||||||||
| Exhibit 99.1 | ||||||||
GoHealth Reports Fourth Quarter and Fiscal 2022 Results |  | |||||||
CHICAGO, March 16, 2023 — GoHealth, Inc. (NASDAQ: GOCO), a leading health insurance marketplace and Medicare-focused digital health company, today announced unaudited financial results and select operating metrics for the fourth quarter and year ended December 31, 2022.
 | Full year 2022 positive cash flow from operations of $60.9 million, a $359.9 million improvement compared to the prior year period, driven by strong operating results including improvements in efficiency year-over-year and Encompass penetration rates. | ||||
| Fourth quarter 2022 net revenue of $69.4 million, net loss of $150.7 million, and Adjusted EBITDA1 of negative $94.8 million. Full year 2022 net revenue of $631.7 million, net loss of $376.4 million, and Adjusted EBITDA1 of negative $129.8 million. | ||||
| Fourth quarter negative revenue adjustments that represent changes in estimates relating to performance obligations satisfied in prior periods (the “Lookback Adjustments”) reduced net revenue by $266.4 million and reduced both net loss and Adjusted EBITDA1 by $186.6 million. Full year 2022 Lookback Adjustments reduced net revenue by $275.7 million and reduced both net loss and Adjusted EBITDA1 by $192.7 million. | ||||
| Excluding the Lookback Adjustments, fourth quarter 2022 net revenue was $335.8 million and full year 2022 net revenue was $907.4 million. Excluding the Lookback Adjustments, fourth quarter 2022 Adjusted EBITDA1 was $91.8 million and full year 2022 Adjusted EBITDA1 was $62.9 million.2 | ||||
| Full Year 2023 Guidance | |||||
| The Company provided its full year 2023 outlook, and expects total net revenue of $750 - $850 million and Adjusted EBITDA1 of $100 - $140 million, both excluding non-Encompass BPO Services.3 The Company also expects positive cash flow from operations of $75 - $115 million. | ||||
“Our focus on the continued improvement of the beneficiary experience resulted in positive operating results, reinforcing our confidence in our business transformation strategy. Our top-tier team drove exceptional execution with improvements on key measures including conversion, customer acquisition costs, and effectuation during AEP. Full year cash flow of $60.9 million, driven by the Encompass model and our operating efficiency, validates our momentum,” said Vijay Kotte, CEO of GoHealth. Kotte continued, “The move to Encompass was a strategic decision to reset the cash dynamics and margin profile of the business and deliver a better shopping experience for beneficiaries. With Encompass and our proprietary technology, GoHealth uniquely delivers an unbiased, personalized shopping experience for ever-changing beneficiary needs as well as seamless, customized onboarding by health plan dedicated resources. We believe beneficiaries are getting the best health plan for their needs, and more importantly gaining peace of mind.” “After adjusting for trends we are seeing in today’s market and reflecting Q4 AEP results in our actuarial review of our back-book, we recorded a negative lookback adjustment of $266.4 million in revenue for policies sold in 2021 and prior years, which had an unfavorable impact of $186.6 million to net loss and Adjusted EBITDA1. With this adjustment, we believe we have done our best to mitigate the risk of any further out-of-period negative lookback adjustments,” said Jason Schulz, CFO of GoHealth. | ||
The Company made the strategic decision to exit its non-Encompass BPO Services3 to focus on its core business. The financial benefit of this change will begin to flow through the Company’s results in the second quarter of 2023, while the exit is expected to be complete in the third quarter of 2023. In 2022, non-Encompass BPO Services3 contributed $110.9 million of net revenue with a gross margin of $20.5 million. Full year 2022 net revenue excluding both non-Encompass BPO Services3 revenue of $110.9 million and the Lookback Adjustments of $275.7 million was $796.5 million, and Adjusted EBITDA1 excluding both the non-Encompass BPO Services3 gross margin of $20.5 million and the Lookback Adjustments of $192.7 million was $42.4 million.4
The unaudited results for the fourth quarter and year ended December 31, 2022 included in this release, which are the responsibility of management, were prepared by the Company's management in connection with the preparation of the Company's financial statements. The Company's independent registered public accounting firm has not completed its audit of the unaudited financial information, nor have they expressed any opinion or any other form of assurance on such information or its achievability, and assume no responsibility for, and disclaim any association with, such unaudited financial information. These unaudited results should not be viewed as a substitute for complete financial statements prepared in accordance with generally accepted accounting principles ("GAAP"). Accordingly, investors are cautioned not to place undue reliance on this unaudited financial information. See the information below under the heading "Forward-Looking Statements" and "Risk Factors" and "Management's Discussion and Analysis of Financial Conditions and Results of Operations" in the Company's 2021 Form 10-K, Quarterly Report on Form 10-Q for the first quarter ended March 31, 2022, Quarterly Report on Form 10-Q for the second quarter ended June 30, 2022, Quarterly Report on Form 10-Q for the third quarter ended September 30, 2022, the forthcoming 2022 Form 10-K, and other SEC filings.
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Conference Call Details
The Company will host a conference call today, Thursday, March 16, 2023 at 5:00 p.m. (ET) to discuss its financial results. Participants can pre-register for the conference call at the following link: https://register.vevent.com/register/BId24e31536feb464b907f05de8417ecf7. A live audio webcast of the conference call will be available via GoHealth's Investor Relations website, https://investors.gohealth.com/. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call.
About GoHealth, Inc.:
As a leading health insurance marketplace and Medicare-focused digital health company, GoHealth's mission is to improve access to healthcare in America. Enrolling in a health insurance plan can be confusing for customers, and the seemingly small differences between plans can lead to significant out-of-pocket costs or lack of access to critical medicines and even providers. GoHealth combines cutting-edge technology, data science and deep industry expertise to match customers with the healthcare policy and health plan that is right for them. GoHealth has enrolled millions of people in Medicare plans and individual and family plans. For more information, visit https://www.gohealth.com.
| Investor Relations: | ||
| IR@gohealth.com | ||
| Media Relations: | ||
| Pressinquiries@gohealth.com | ||
(1)Adjusted EBITDA is a non-GAAP measure. For a definition of Adjusted EBITDA and a reconciliation to the most comparable GAAP measure, please see below.
(2)Net revenue excluding the Lookback Adjustments and Adjusted EBITDA excluding the Lookback Adjustments are non-GAAP measures. For fourth quarter and full year impact on revenue and Adjusted EBITDA for the Lookback Adjustments and for a reconciliation to the most comparable GAAP measure, please see table provided below.
(3)Non-Encompass BPO Services are those services in which we dedicate certain agents to specific health plans and agencies, outside of the Encompass Solution.
(4)Net revenue excluding the Lookback Adjustments and non-Encompass BPO Services and Adjusted EBITDA excluding the Lookback Adjustments and non-Encompass BPO Services gross margin are non-GAAP measures. For a reconciliation to the most comparable GAAP measure, please see table provided below.
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Forward-Looking Statements
This press release contains forward-looking statements. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (“the Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“the Exchange Act”). All statements other than statements of historical facts contained in this press release may be forward-looking statements. Statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding our expected growth, level of cash flow, future capital expenditures and debt service obligations are forward-looking statements.
In some cases, you can identify forward-looking statements by terms, such as “may,” “will,” “should,” “aim,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “likely,” “future,” or “continue” or the negative of these terms or other similar expressions. 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.
These forward-looking statements speak only as of the date of this press release and are subject to a number of important factors that could cause actual results to differ materially from those in the forward-looking statements, including, but are not limited to, the following: the marketing and sale of Medicare plans are subject to numerous, complex and frequently changing laws, regulations and guidelines; our operating results have been, and may continue to be, adversely impacted by factors that impact our estimate of LTV; our gradual expansion of the Encompass Solution may not be as successful as we expect; our business may be harmed if we lose our relationships with health plans or if our relationships with health plans change; health plans may reduce the commissions paid to us and change their underwriting practices in ways that reduce the number of, or impact the renewal or approval rates of, insurance policies sold through our platform; our management identified a material weakness in our internal controls over financial reporting, and we may be unable to develop, implement and maintain appropriate controls in future periods, which may lead to errors or omissions in our financial statements; we currently depend on a small group of health plans for a substantial portion of our revenue; information technology system failures could interrupt our operations; factors that impact our estimate of LTV (as defined below); we may lose key employees or fail to attract qualified employees; our failure to grow our customer base or retain our existing customers; we may not realize the benefits we expect from our strategic cash flow optimization and other cash management initiatives; our ability to sell Medicare-related health insurance plans is largely dependent on our licensed health insurance agents; operating and growing our business may require additional capital; and the Founders and Centerbridge have significant influence over us, including control over decisions that require the approval of stockholders.
The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this press release, as well as the cautionary statements and other risk factors set forth in the 2021 Form 10-K, Quarterly Report on Form 10-Q for the first quarter ended March 31, 2022, Quarterly Report on Form 10-Q for the second quarter ended June 30, 2022, Quarterly Report on Form 10-Q for the third quarter ended September 30, 2022, the forthcoming 2022 Form 10-K, and other SEC filings. If one or more events related to these or other risks or uncertainties materialize, or our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. Many of the important factors that will determine these results are beyond our ability to control or predict. 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. New factors emerge from time to time, and it is not possible for us to predict which will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Use of Non-GAAP Financial Measures and Key Performance Indicators
In this press release, we use supplemental measures of our performance that are derived from our consolidated financial information, but which are not presented in our Consolidated Financial Statements prepared in accordance with Generally Accepted Accounting Principles (“GAAP”). These non-GAAP financial measures include net income (loss) before interest expense, income tax expense (benefit) and depreciation and amortization expense (“EBITDA”); Adjusted EBITDA and Adjusted EBITDA margin. Adjusted EBITDA is the primary financial performance measure used by management to evaluate its business and monitor its results of operations.
Additional non-GAAP financial measures, including net revenue excluding the Lookback Adjustments, Adjusted EBITDA excluding the Lookback Adjustments, net revenue excluding both the non-Encompass BPO services revenue and the Lookback Adjustments and Adjusted EBITDA excluding both the non-Encompass BPO Services gross margin and the Lookback Adjustments, are also discussed in this press release. The Lookback Adjustments are revenue adjustments that represent changes in estimates relating to performance obligations satisfied in prior periods and relate to the fiscal years 2021 and prior.
Adjusted EBITDA represents, as applicable for the period, EBITDA as further adjusted for certain items summarized below in this press release. Adjusted EBITDA margin represents Adjusted EBITDA divided by net revenues.
We use non-GAAP financial measures to supplement financial information presented on a GAAP basis. We believe that excluding certain items from our GAAP results allows management to better understand our consolidated financial performance from period to period and better project our future consolidated financial performance as forecasts are developed at a level of
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detail different from that used to prepare GAAP-based financial measures. Moreover, we believe these non-GAAP financial measures provide our stakeholders with useful information to help them evaluate our operating results by facilitating an enhanced understanding of our operating performance and enabling them to make more meaningful period to period comparisons. Adjusted EBITDA is used as a basis for certain compensation programs sponsored by the Company. There are limitations to the use of the non-GAAP financial measures presented in this press release. For example, our non-GAAP financial measures may not be comparable to similarly titled measures of other companies. Other companies, including companies in our industry, may calculate non-GAAP financial measures differently than we do, limiting the usefulness of those measures for comparative purposes.
The non-GAAP financial measures are not meant to be considered as indicators of performance in isolation from or as a substitute for net income (loss) prepared in accordance with GAAP, and should be read only in conjunction with financial information presented on a GAAP basis. Reconciliations of each of EBITDA, Adjusted EBITDA, net revenue excluding the Lookback Adjustments, Adjusted EBITDA excluding the Lookback Adjustments, net revenue excluding both the non-Encompass BPO Services revenue and the Lookback Adjustments, and Adjusted EBITDA excluding both the non-Encompass BPO Services contribution and the Lookback Adjustments to its most directly comparable GAAP financial measure, net revenue or net income (loss), are presented in the tables below in this press release. We encourage you to review the reconciliations in conjunction with the presentation of the non-GAAP financial measures for each of the periods presented. In future periods, we may exclude similar items, may incur income and expenses similar to these excluded items and include other expenses, costs and non-recurring items.
The Company is unable to provide a full reconciliation of guidance for Adjusted EBITDA without unreasonable effort because it is not possible to predict certain adjustment items with a reasonable degree of certainty since they are not yet known or quantifiable, and do not relate to the Company’s routine activities. This information is dependent upon future events, which may be outside of the Company’s control and could have a significant impact on its GAAP financial results for fiscal 2023.
Glossary
•“EBITDA” represents net income (loss) before interest expense, income tax expense (benefit) and depreciation and amortization expense.
•“Adjusted EBITDA” represents, as applicable for the period, EBITDA as further adjusted for certain items summarized below in this press release.
•“Adjusted EBITDA Margin” refers to Adjusted EBITDA divided by net revenues.
•“Gross margin” refers to net revenue divided by cost of revenue, marketing and advertising expenses and customer care and enrollment expenses.
•“LTV” refers to the Lifetime Value of Commissions, which we define as aggregate commissions estimated to be collected over the estimated life of all commissionable Submissions for the relevant period based on multiple factors, including but not limited to, contracted commission rates, health plan mix and expected policy persistency with applied constraints.
•“Non-Encompass BPO Services” refer to programs in which GoHealth-employed agents are dedicated to certain health plans and agencies we partner with outside of the Encompass Solution.
•“Sales per Submission” refers to (x) the combination sum of (i) aggregate commissions estimated to be collected over the estimated life of all commissionable Submissions for the relevant period based on multiple factors, including but not limited to, contracted commission rates, health plan mix and expected policy persistency with applied constraints, excluding revenue adjustments recorded in the period, but relating to performance obligations satisfied in prior periods, (ii) Encompass revenue, and (iii) partner marketing and enrollment services, divided by (y) the number of Submissions for such period.
•“Submission” refers to either (i) a completed application with our licensed agent that is submitted to the insurance health plan partner and subsequently approved by the health plan partner during the indicated period, excluding applications through our non-Encompass BPO Services or (ii) a transfer by our agent to the health plan partner through the Encompass marketplace during the indicated period.
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The following tables set forth the components of our results of operations for the periods indicated (unaudited):
| Three months ended Dec. 31, | ||||||||||||||||||||||||||||||||||||||
| (in thousands, except percentages and per share amounts) | 2022 | 2021 | ||||||||||||||||||||||||||||||||||||
| Dollars | % of Net Revenues | Dollars | % of Net Revenues | $ Change | % Change | |||||||||||||||||||||||||||||||||
| Net revenues: | ||||||||||||||||||||||||||||||||||||||
| Commission | $ | (73,268) | (105.6) | % | $ | 384,826 | 85.6 | % | $ | (458,094) | (119.0) | % | ||||||||||||||||||||||||||
| Enterprise | 142,644 | 205.6 | % | 64,774 | 14.4 | % | 77,870 | 120.2 | % | |||||||||||||||||||||||||||||
| Net revenues | 69,376 | 100.0 | % | 449,600 | 100.0 | % | (380,224) | (84.6) | % | |||||||||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||||||||||||||
| Cost of revenue | 20,629 | 29.7 | % | 99,886 | 22.2 | % | (79,257) | (79.3) | % | |||||||||||||||||||||||||||||
| Marketing and advertising expense | 56,151 | 80.9 | % | 195,411 | 43.5 | % | (139,260) | (71.3) | % | |||||||||||||||||||||||||||||
| Customer care and enrollment | 64,752 | 93.3 | % | 122,269 | 27.2 | % | (57,517) | (47.0) | % | |||||||||||||||||||||||||||||
| Technology expense | 11,525 | 16.6 | % | 15,178 | 3.4 | % | (3,653) | (24.1) | % | |||||||||||||||||||||||||||||
| General and administrative | 25,671 | 37.0 | % | 29,007 | 6.5 | % | (3,336) | (11.5) | % | |||||||||||||||||||||||||||||
| Amortization of intangible assets | 23,514 | 33.9 | % | 23,513 | 5.2 | % | 1 | — | % | |||||||||||||||||||||||||||||
| Restructuring and other related charges | 312 | 0.4 | % | — | — | % | 312 | NM | ||||||||||||||||||||||||||||||
| Goodwill impairment charges | — | — | % | 386,553 | 86.0 | % | (386,553) | NM | ||||||||||||||||||||||||||||||
| Operating lease impairment charges | — | — | % | 1,062 | 0.2 | % | (1,062) | NM | ||||||||||||||||||||||||||||||
| Total operating expenses | 202,554 | 292.0 | % | 872,879 | 194.1 | % | (670,325) | (76.8) | % | |||||||||||||||||||||||||||||
| Income (loss) from operations | (133,178) | (192.0) | % | (423,279) | (94.1) | % | 290,101 | (68.5) | % | |||||||||||||||||||||||||||||
| Interest expense | 17,317 | 25.0 | % | 9,619 | 2.1 | % | 7,698 | 80.0 | % | |||||||||||||||||||||||||||||
| Other (income) expense, net | (50) | (0.1) | % | (696) | (0.2) | % | 646 | (92.8) | % | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | (150,445) | (216.9) | % | (432,202) | (96.1) | % | 281,757 | (65.2) | % | |||||||||||||||||||||||||||||
| Income tax expense (benefit) | 292 | 0.4 | % | 118 | — | % | 174 | 147.5 | % | |||||||||||||||||||||||||||||
| Net income (loss) | $ | (150,737) | (217.3) | % | $ | (432,320) | (96.2) | % | $ | 281,583 | (65.1) | % | ||||||||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests | (89,338) | (128.8) | % | (277,225) | (61.7) | % | 187,887 | (67.8) | % | |||||||||||||||||||||||||||||
| Net income (loss) attributable to GoHealth, Inc. | $ | (61,399) | (88.5) | % | $ | (155,095) | (34.5) | % | $ | 93,696 | (60.4) | % | ||||||||||||||||||||||||||
| Net income (loss) per share: | ||||||||||||||||||||||||||||||||||||||
| Net income (loss) per share of common stock — basic and diluted | $ | (7.00) | $ | (20.22) | ||||||||||||||||||||||||||||||||||
| Weighted-average shares of Class A common stock outstanding — basic and diluted | 8,895 | 7,669 | ||||||||||||||||||||||||||||||||||||
| Non-GAAP financial measures: | ||||||||||||||||||||||||||||||||||||||
| EBITDA | $ | (106,550) | $ | (392,251) | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | (94,781) | $ | 1,499 | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDA margin | (136.6) | % | 0.3 | % | ||||||||||||||||||||||||||||||||||
NM = Not meaningful
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| Twelve months ended Dec. 31, | ||||||||||||||||||||||||||||||||||||||
| (in thousands, except percentages and per share amounts) | 2022 | 2021 | ||||||||||||||||||||||||||||||||||||
| Dollars | % of Net Revenues | Dollars | % of Net Revenues | $ Change | % Change | |||||||||||||||||||||||||||||||||
| Net revenues: | ||||||||||||||||||||||||||||||||||||||
| Commission | $ | 341,467 | 54.1 | % | $ | 881,263 | 82.9 | % | $ | (539,796) | (61.3) | % | ||||||||||||||||||||||||||
| Enterprise | 290,208 | 45.9 | % | 181,152 | 17.1 | % | 109,056 | 60.2 | % | |||||||||||||||||||||||||||||
| Net revenues | 631,675 | 100.0 | % | 1,062,415 | 100.0 | % | (430,740) | (40.5) | % | |||||||||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||||||||||||||
| Cost of revenue | 187,670 | 29.7 | % | 239,335 | 22.5 | % | (51,665) | (21.6) | % | |||||||||||||||||||||||||||||
| Marketing and advertising expense | 207,559 | 32.9 | % | 365,141 | 34.4 | % | (157,582) | (43.2) | % | |||||||||||||||||||||||||||||
| Customer care and enrollment | 260,902 | 41.3 | % | 319,103 | 30.0 | % | (58,201) | (18.2) | % | |||||||||||||||||||||||||||||
| Technology expense | 46,094 | 7.3 | % | 48,429 | 4.6 | % | (2,335) | (4.8) | % | |||||||||||||||||||||||||||||
| General and administrative | 116,530 | 18.4 | % | 98,183 | 9.2 | % | 18,347 | 18.7 | % | |||||||||||||||||||||||||||||
| Amortization of intangible assets | 94,057 | 14.9 | % | 94,056 | 8.9 | % | 1 | — | % | |||||||||||||||||||||||||||||
| Operating lease impairment charges | 25,345 | 4.0 | % | 1,062 | 0.1 | % | 24,283 | NM | ||||||||||||||||||||||||||||||
| Restructuring and other related charges | 12,184 | 1.9 | % | — | — | % | 12,184 | NM | ||||||||||||||||||||||||||||||
| Goodwill impairment charges | — | — | % | 386,553 | 36.4 | % | (386,553) | NM | ||||||||||||||||||||||||||||||
| Total operating expenses | 950,341 | 150.4 | % | 1,551,862 | 146.1 | % | (601,521) | (38.8) | % | |||||||||||||||||||||||||||||
| Income (loss) from operations | (318,666) | (50.4) | % | (489,447) | (46.1) | % | 170,781 | (34.9) | % | |||||||||||||||||||||||||||||
| Interest expense | 57,069 | 9.0 | % | 33,505 | 3.2 | % | 23,564 | 70.3 | % | |||||||||||||||||||||||||||||
| Loss on extinguishment of debt | — | — | % | 11,935 | 1.1 | % | (11,935) | NM | ||||||||||||||||||||||||||||||
| Other (income) expense, net | (115) | — | % | (669) | (0.1) | % | 554 | (82.8) | % | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | (375,620) | (59.5) | % | (534,218) | (50.3) | % | 158,598 | (29.7) | % | |||||||||||||||||||||||||||||
| Income tax expense (benefit) | 764 | 0.1 | % | (24) | — | % | 788 | (3283.3) | % | |||||||||||||||||||||||||||||
| Net income (loss) | $ | (376,384) | (59.6) | % | $ | (534,194) | (50.3) | % | $ | 157,810 | (29.5) | % | ||||||||||||||||||||||||||
| Net income (loss) attributable to noncontrolling interests | (227,678) | (36.0) | % | (344,837) | (32.5) | % | $ | 117,159 | (34.0) | % | ||||||||||||||||||||||||||||
| Net income (loss) attributable to GoHealth, Inc. | $ | (148,706) | (23.5) | % | $ | (189,357) | (17.8) | % | $ | 40,651 | (21.5) | % | ||||||||||||||||||||||||||
| Net income (loss) per share: | ||||||||||||||||||||||||||||||||||||||
| Net income (loss) per share of common stock — basic and diluted | $ | (17.72) | $ | (26.80) | ||||||||||||||||||||||||||||||||||
| Weighted-average shares of Class A common stock outstanding — basic and diluted | 8,445 | 7,066 | ||||||||||||||||||||||||||||||||||||
| Non-GAAP financial measures: | ||||||||||||||||||||||||||||||||||||||
| EBITDA | $ | (211,549) | $ | (393,206) | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDA | $ | (129,776) | $ | 33,821 | ||||||||||||||||||||||||||||||||||
| Adjusted EBITDA margin | (20.5) | % | 3.2 | % | ||||||||||||||||||||||||||||||||||
_________________________
NM = Not meaningful
6
The following tables set forth the reconciliations of GAAP net income (loss) to EBITDA and Adjusted EBITDA for the periods indicated (unaudited):
| Three months ended Dec. 31, | ||||||||||||||
| (in thousands) | 2022 | 2021 | ||||||||||||
| Net revenues | $ | 69,376 | $ | 449,600 | ||||||||||
| Net income (loss) | (150,737) | (432,320) | ||||||||||||
| Interest expense | 17,317 | 9,619 | ||||||||||||
| Income tax expense (benefit) | 292 | 118 | ||||||||||||
| Depreciation and amortization expense | 26,578 | 30,332 | ||||||||||||
| EBITDA | (106,550) | (392,251) | ||||||||||||
| Share-based compensation expense (1) | 6,256 | 7,197 | ||||||||||||
| Legal fees (2) | 3,478 | — | ||||||||||||
| Professional services (3) | 773 | — | ||||||||||||
| Other (income) loss related to the adjustment of liabilities under the Tax Receivable Agreement (4) | 550 | — | ||||||||||||
| Severance costs (5) | 400 | — | ||||||||||||
| Restructuring and other related charges (6) | 312 | — | ||||||||||||
| Goodwill impairment charges (7) | — | 386,553 | ||||||||||||
| Adjusted EBITDA | $ | (94,781) | $ | 1,499 | ||||||||||
| Adjusted EBITDA margin | (136.6) | % | 0.3 | % | ||||||||||
_________________________
(1)Represents non-cash share-based compensation expense relating to equity awards as well as share-based compensation expense relating to liability classified awards that will be settled in cash..
(2)Represents non-recurring legal fees unrelated to our core operations.
(3)Represents costs associated with non-recurring consulting fees and other professional services.
(4)Represents expense related to the measurement of our Tax Receivable Agreement obligation.
(5)Represents costs associated with the termination of employment and associated fees unrelated to restructuring activities.
(6)Represents employee termination benefits and other associated costs related to restructuring activities.
(7)Represents goodwill impairment charges related to the Medicare— Internal and Medicare— External reporting units for the twelve months ended December 31, 2021.
| Twelve months ended Dec. 31, | ||||||||||||||
| (in thousands) | 2022 | 2021 | ||||||||||||
| Net revenues | $ | 631,675 | $ | 1,062,415 | ||||||||||
| Net income (loss) | (376,384) | (534,194) | ||||||||||||
| Interest expense | 57,069 | 33,505 | ||||||||||||
| Income tax expense (benefit) | 764 | (24) | ||||||||||||
| Depreciation and amortization expense | 107,002 | 107,507 | ||||||||||||
| EBITDA | (211,549) | (393,206) | ||||||||||||
| Share-based compensation expense (1) | 32,124 | 27,297 | ||||||||||||
| Operating lease impairment charges (2) | 25,345 | 1,062 | ||||||||||||
| Restructuring and other related charges (3) | 12,184 | — | ||||||||||||
| Professional services (4) | 4,752 | — | ||||||||||||
| Severance costs (5) | 3,340 | — | ||||||||||||
| Legal fees (6) | 3,478 | 180 | ||||||||||||
| Other (income) loss related to the adjustment of liabilities under the Tax Receivable Agreement (7) | 550 | — | ||||||||||||
| Loss on extinguishment of debt (8) | — | 11,935 | ||||||||||||
| Goodwill impairment charges (9) | — | 386,553 | ||||||||||||
| Adjusted EBITDA | $ | (129,776) | $ | 33,821 | ||||||||||
| Adjusted EBITDA margin | (20.5) | % | 3.2 | % | ||||||||||
_________________________
(1)Represents non-cash share-based compensation expense relating to equity awards as well as share-based compensation expense relating to liability classified awards that will be settled in cash.
(2)Represents operating lease impairment charges, reducing the carrying value of the associated ROU assets and leasehold improvements to the estimated fair values.
(3)Represents employee termination benefits and other associated costs related to restructuring activities.
(4)Represents costs associated with non-recurring consulting fees and other professional services.
(5)Represents costs associated with the termination of employment and associated fees unrelated to restructuring activities.
(6)Represents non-recurring legal fees unrelated to our core operations.
(7)Represents expense related to the measurement of our Tax Receivable Agreement obligation.
(8)Represents the loss on debt extinguishment related to the Initial Term Loan Facility.
(9)Represents goodwill impairment charges related to the Medicare— Internal and Medicare— External reporting units for the twelve months ended December 31, 2021.
7
The following table summarizes net revenue and Adjusted EBITDA excluding the Lookback Adjustments and non-Encompass BPO Services for the periods indicated (unaudited):
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||||||||||||||||
| (in thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
| Net revenue | $ | 69,376 | $ | 449,600 | $ | 631,675 | $ | 1,062,415 | ||||||||||||||||||
| Lookback Adjustments reported during the indicated periods | 266,383 | 155,002 | 275,709 | 165,296 | ||||||||||||||||||||||
| Lookback Adjustments attributed to 2021 | — | (57,942) | — | (208,848) | ||||||||||||||||||||||
| Net revenue excluding Lookback Adjustments | 335,759 | 546,660 | 907,384 | 1,018,863 | ||||||||||||||||||||||
| Exit of non-Encompass BPO Services | (34,198) | (83,947) | (110,865) | (163,563) | ||||||||||||||||||||||
| Net revenues excluding Lookback Adjustments and non-Encompass BPO Services | 301,561 | 462,713 | 796,519 | 855,300 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | (94,781) | $ | 1,499 | $ | (129,776) | $ | 33,821 | ||||||||||||||||||
| Lookback Adjustments reported during the indicated periods | 186,617 | 105,373 | 192,693 | 111,863 | ||||||||||||||||||||||
| Lookback Adjustments attributed to 2021 | — | (42,484) | — | (149,559) | ||||||||||||||||||||||
| Adjusted EBITDA excluding Lookback Adjustments | 91,836 | 64,388 | 62,917 | (3,875) | ||||||||||||||||||||||
| Exit of non-Encompass BPO Services | (6,980) | (13,319) | (20,476) | (25,295) | ||||||||||||||||||||||
| Adjusted EBITDA excluding Lookback Adjustments and non-Encompass BPO Services | $ | 84,856 | $ | 51,069 | $ | 42,441 | $ | (29,170) | ||||||||||||||||||
| Adjusted EBITDA margin excluding Lookback Adjustments and non-Encompass BPO Services | 28.1 | % | 11.0 | % | 5.3 | % | (3.4) | % | ||||||||||||||||||
The following table summarizes share-based compensation expense by operating function for the periods indicated (unaudited):
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||||||||||||||||
| (in thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
| Marketing and advertising | 490 | 646 | $ | 1,653 | $ | 2,108 | ||||||||||||||||||||
| Customer care and enrollment | 484 | 980 | 2,218 | 3,775 | ||||||||||||||||||||||
| Technology | 471 | 984 | 2,924 | 3,775 | ||||||||||||||||||||||
| General and administrative | 4,811 | 4,587 | 25,329 | 17,639 | ||||||||||||||||||||||
| Total share-based compensation expense | $ | 6,256 | 7,197 | $ | 32,124 | $ | 27,297 | |||||||||||||||||||
8
The following table sets forth our balance sheets for the periods indicated (unaudited):
| Dec. 31, | ||||||||||||||
| (in thousands, except per share amounts) | 2022 | 2021 | ||||||||||||
| Assets | ||||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 16,464 | $ | 84,361 | ||||||||||
| Accounts receivable, net of allowance for doubtful accounts of $89 in 2022 and $558 in 2021 | 4,703 | 17,276 | ||||||||||||
| Commissions receivable - current | 335,796 | 268,663 | ||||||||||||
| Prepaid expense and other current assets | 57,593 | 58,695 | ||||||||||||
| Total current assets | 414,556 | 428,995 | ||||||||||||
| Commissions receivable - non-current | 695,637 | 993,844 | ||||||||||||
| Operating lease ROU asset | 21,483 | 23,462 | ||||||||||||
| Other long-term assets | 1,721 | 3,608 | ||||||||||||
| Property, equipment, and capitalized software, net | 25,282 | 24,273 | ||||||||||||
| Intangible assets, net | 500,611 | 594,669 | ||||||||||||
| Total assets | $ | 1,659,290 | $ | 2,068,851 | ||||||||||
| Liabilities, Redeemable Convertible Preferred Stock and Stockholders’ Equity | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable | $ | 15,148 | $ | 39,843 | ||||||||||
| Accrued liabilities | 53,334 | 52,788 | ||||||||||||
| Commissions payable - current | 122,023 | 104,160 | ||||||||||||
| Short-term operating lease liability | 8,974 | 6,126 | ||||||||||||
| Deferred revenue | 50,594 | 536 | ||||||||||||
| Current portion of long-term debt | 5,270 | 5,270 | ||||||||||||
| Other current liabilities | 10,112 | 8,344 | ||||||||||||
| Total current liabilities | 265,455 | 217,067 | ||||||||||||
| Non-current liabilities: | ||||||||||||||
| Commissions payable - non-current | 253,118 | 274,403 | ||||||||||||
| Long-term operating lease liability | 38,367 | 19,776 | ||||||||||||
| Long-term debt, net of current portion | 504,810 | 665,115 | ||||||||||||
| Other non-current liabilities | 5,839 | — | ||||||||||||
| Total non-current liabilities | 802,134 | 959,294 | ||||||||||||
| Commitments and Contingencies | ||||||||||||||
| Series A redeemable convertible preferred stock — $0.0001 par value; 50 shares authorized; 50 shares issued and outstanding at December 31, 2022. No shares issued and outstanding as of December 31, 2021. Liquidation preference of $50.9 million at December 31, 2022. | 49,302 | — | ||||||||||||
| Stockholders’ equity: | ||||||||||||||
| Class A common stock – $0.0001 par value; 1,100,000 shares authorized; 8,963 and 7,699 shares issued; 8,950 and 7,699 shares outstanding at December 31, 2022 and December 31, 2021, respectively. | 1 | 1 | ||||||||||||
| Class B common stock – $0.0001 par value; 616,259 and 587,360 shares authorized; 13,054 and 13,690 shares issued and outstanding at December 31, 2022 and December 31, 2021, respectively. | 1 | 1 | ||||||||||||
| Preferred stock – $0.0001 par value; 20,000 shares authorized (including 50 shares of Series A redeemable convertible preferred stock authorized and 200 shares of Series A-1 convertible preferred stock authorized); 50 shares issued and outstanding at December 31, 2022; no shares issued and outstanding at December 31, 2021. | — | — | ||||||||||||
| Series A-1 convertible preferred stock— $0.0001 par value; 200 shares authorized; no shares issued and outstanding at December 31, 2022 and December 31, 2021. | — | — | ||||||||||||
| Treasury stock – at cost; 13 shares of Class A common stock at December 31, 2022 | (345) | — | ||||||||||||
| Additional paid-in capital | 626,269 | 561,477 | ||||||||||||
| Accumulated other comprehensive income (loss) | (144) | (59) | ||||||||||||
| Accumulated deficit | (357,023) | (208,317) | ||||||||||||
| Total stockholders’ equity attributable to GoHealth, Inc. | 268,759 | 353,103 | ||||||||||||
| Non-controlling interests | 273,640 | 539,387 | ||||||||||||
| Total stockholders’ equity | 542,399 | 892,490 | ||||||||||||
| Total liabilities, redeemable convertible preferred stock and stockholders’ equity | $ | 1,659,290 | $ | 2,068,851 | ||||||||||
9
The following table sets forth our statements of cash flows for the periods indicated (unaudited):
| Twelve months ended Dec. 31, | ||||||||||||||
| (in thousands) | 2022 | 2021 | ||||||||||||
| Operating Activities | ||||||||||||||
| Net income (loss) | $ | (376,384) | $ | (534,194) | ||||||||||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||||||||||||||
| Share-based compensation | 27,142 | 27,297 | ||||||||||||
| Depreciation and amortization | 12,945 | 13,451 | ||||||||||||
| Amortization of intangible assets | 94,057 | 94,056 | ||||||||||||
| Amortization of debt discount and issuance costs | 2,896 | 2,222 | ||||||||||||
| Loss on extinguishment of debt | — | 11,935 | ||||||||||||
| Operating lease impairment charges | 25,345 | 1,062 | ||||||||||||
| Goodwill impairment charges | — | 386,553 | ||||||||||||
| Non-cash restructuring charges | 976 | — | ||||||||||||
| Non-cash lease expense | 4,017 | 5,033 | ||||||||||||
| Other non-cash items, net | (250) | (5) | ||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Accounts receivable | 12,574 | (2,758) | ||||||||||||
| Commissions receivable | 231,274 | (452,950) | ||||||||||||
| Prepaid expenses and other assets | 2,140 | (18,613) | ||||||||||||
| Accounts payable | (24,795) | 30,477 | ||||||||||||
| Accrued liabilities | 546 | 25,745 | ||||||||||||
| Deferred revenue | 50,058 | (200) | ||||||||||||
| Commissions payable | (3,423) | 117,489 | ||||||||||||
| Operating lease liabilities | (6,597) | (4,885) | ||||||||||||
| Other liabilities | 8,383 | (721) | ||||||||||||
| Net cash provided by (used in) operating activities | 60,904 | (299,006) | ||||||||||||
| Investing Activities | ||||||||||||||
| Purchases of property, equipment and software | (13,512) | (19,801) | ||||||||||||
| Net cash used in investing activities | (13,512) | (19,801) | ||||||||||||
| Financing Activities | ||||||||||||||
| Repayment of borrowings | (160,270) | (298,970) | ||||||||||||
| Proceeds from stock option exercises | 5 | — | ||||||||||||
| Proceeds from sale of Series A redeemable convertible preferred stock | 50,000 | — | ||||||||||||
| Issuance cost payments from issuance of Series A redeemable convertible preferred stock | (1,641) | — | ||||||||||||
| Debt issuance cost payments | (2,697) | (4,108) | ||||||||||||
| Repurchase of shares to satisfy employee tax withholding obligations | (345) | — | ||||||||||||
| Principal payments under capital lease obligations | (103) | (318) | ||||||||||||
| Proceeds from borrowings | — | 565,000 | ||||||||||||
| Call premium paid for debt extinguishment | — | (5,910) | ||||||||||||
| Advancement to NVX Holdings, Inc. | — | 3,395 | ||||||||||||
| Net cash (used in) provided by financing activities | (115,051) | 259,089 | ||||||||||||
| Effect of exchange rate changes on cash and cash equivalents | (238) | (155) | ||||||||||||
| Increase (decrease) in cash and cash equivalents | (67,897) | (59,873) | ||||||||||||
| Cash and cash equivalents at beginning of period | 84,361 | 144,234 | ||||||||||||
| Cash and cash equivalents at end of period | $ | 16,464 | $ | 84,361 | ||||||||||
| Supplemental Disclosure of Cash Flow Information | ||||||||||||||
| Interest paid | 56,920 | 28,244 | ||||||||||||
| Income taxes paid | 486 | 879 | ||||||||||||
10
The following tables set forth operating segment results for the periods indicated (unaudited):
| Three months ended Dec. 31, | ||||||||||||||||||||||||||||||||||||||
| (in thousands, except percentages) | 2022 | 2021 | ||||||||||||||||||||||||||||||||||||
| Dollars | % of Net Revenues | Dollars | % of Net Revenues | $ Change | % Change | |||||||||||||||||||||||||||||||||
| Net revenues: | ||||||||||||||||||||||||||||||||||||||
| Medicare - Internal | $ | 34,477 | 49.7 | % | $ | 368,503 | 82.1 | % | $ | (334,026) | (90.6) | % | ||||||||||||||||||||||||||
| Medicare - External | 28,504 | 41.1 | % | 72,447 | 16.1 | % | (43,943) | (60.7) | % | |||||||||||||||||||||||||||||
| IFP and Other - Internal | 6,069 | 8.7 | % | 6,182 | 1.4 | % | (113) | (1.8) | % | |||||||||||||||||||||||||||||
| IFP and Other - External | 327 | 0.5 | % | 2,468 | 0.5 | % | (2,141) | (86.8) | % | |||||||||||||||||||||||||||||
| Net revenues | 69,377 | 100.0 | % | 449,600 | 100.0 | % | (380,223) | (84.6) | % | |||||||||||||||||||||||||||||
| Segment profit (loss): | ||||||||||||||||||||||||||||||||||||||
| Medicare - Internal | (69,790) | (100.6) | % | 10,771 | 2.4 | % | (80,561) | (747.9) | % | |||||||||||||||||||||||||||||
| Medicare - External | (15,631) | (22.5) | % | 3,075 | 0.7 | % | (18,706) | (608.3) | % | |||||||||||||||||||||||||||||
| IFP and Other - Internal | 1,986 | 2.9 | % | 2,162 | 0.5 | % | (176) | (8.1) | % | |||||||||||||||||||||||||||||
| IFP and Other - External | (257) | (0.4) | % | 472 | 0.1 | % | (729) | (154.4) | % | |||||||||||||||||||||||||||||
| Segment profit (loss) | (83,692) | (120.6) | % | 16,480 | 3.7 | % | (100,172) | (607.8) | % | |||||||||||||||||||||||||||||
| Corporate expense | 25,660 | 37.0 | % | 29,693 | 6.6 | % | (4,033) | (13.6) | % | |||||||||||||||||||||||||||||
| Amortization of intangible assets | 23,514 | 33.9 | % | 23,513 | 5.2 | % | 1 | — | % | |||||||||||||||||||||||||||||
| Restructuring and other related charges | 312 | 0.4 | % | — | — | % | 312 | NM | ||||||||||||||||||||||||||||||
| Goodwill impairment charges | — | — | % | 386,553 | 86.0 | % | (386,553) | NM | ||||||||||||||||||||||||||||||
| Interest expense | 17,317 | 25.0 | % | 9,619 | 2.1 | % | 7,698 | 80.0 | % | |||||||||||||||||||||||||||||
| Other (income) expense, net | (50) | (0.1) | % | (696) | (0.2) | % | 646 | (92.8) | % | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | (150,445) | (216.9) | % | $ | (432,202) | (96.1) | % | $ | 281,757 | (65.2) | % | ||||||||||||||||||||||||||
_________________________
NM = Not meaningful
| Twelve months ended Dec. 31, | ||||||||||||||||||||||||||||||||||||||
| 2022 | 2021 | |||||||||||||||||||||||||||||||||||||
| (in thousands, except percentages) | Dollars | % of Net Revenues | Dollars | % of Net Revenues | $ Change | % Change | ||||||||||||||||||||||||||||||||
| Net revenues: | ||||||||||||||||||||||||||||||||||||||
| Medicare - Internal | $ | 421,273 | 66.7 | % | $ | 844,894 | 79.5 | % | $ | (423,621) | (50.1) | % | ||||||||||||||||||||||||||
| Medicare - External | 189,886 | 30.1 | % | 189,563 | 17.8 | % | 323 | 0.2 | % | |||||||||||||||||||||||||||||
| IFP and Other - Internal | 17,972 | 2.8 | % | 19,687 | 1.9 | % | (1,715) | (8.7) | % | |||||||||||||||||||||||||||||
| IFP and Other - External | 2,544 | 0.4 | % | 8,271 | 0.8 | % | (5,727) | (69.2) | % | |||||||||||||||||||||||||||||
| Net revenues | 631,675 | 100.0 | % | 1,062,415 | 100.0 | % | (430,740) | (40.5) | % | |||||||||||||||||||||||||||||
| Segment profit (loss): | ||||||||||||||||||||||||||||||||||||||
| Medicare - Internal | (43,382) | (6.9) | % | 84,345 | 7.9 | % | (127,727) | (151.4) | % | |||||||||||||||||||||||||||||
| Medicare - External | (31,260) | (4.9) | % | 2,622 | 0.2 | % | (33,882) | (1292.2) | % | |||||||||||||||||||||||||||||
| IFP and Other - Internal | 4,654 | 0.7 | % | 2,819 | 0.3 | % | 1,835 | 65.1 | % | |||||||||||||||||||||||||||||
| IFP and Other - External | (1,502) | (0.2) | % | 245 | — | % | (1,747) | (713.1) | % | |||||||||||||||||||||||||||||
| Segment profit (loss) | (71,490) | (11.3) | % | 90,031 | 8.5 | % | (161,521) | (179.4) | % | |||||||||||||||||||||||||||||
| Corporate expense | 115,590 | 18.3 | % | 97,807 | 9.2 | % | 17,783 | 18.2 | % | |||||||||||||||||||||||||||||
| Amortization of intangible assets | 94,057 | 14.9 | % | 94,056 | 8.9 | % | 1 | — | % | |||||||||||||||||||||||||||||
| Operating lease impairment charges | 25,345 | 4.0 | % | 1,062 | 0.1 | % | 24,283 | NM | ||||||||||||||||||||||||||||||
| Restructuring and other related charges | 12,184 | 1.9 | % | — | — | % | 12,184 | NM | ||||||||||||||||||||||||||||||
| Loss on extinguishment of debt | — | — | % | 11,935 | 1.1 | % | (11,935) | NM | ||||||||||||||||||||||||||||||
| Goodwill impairment charges | — | — | % | 386,553 | 36.4 | % | (386,553) | NM | ||||||||||||||||||||||||||||||
| Interest expense | 57,069 | 9.0 | % | 33,505 | 3.2 | % | 23,564 | 70.3 | % | |||||||||||||||||||||||||||||
| Other (income) expense, net | (115) | — | % | (669) | (0.1) | % | 554 | (82.8) | % | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | $ | (375,620) | (59.5) | % | $ | (534,218) | (50.3) | % | $ | 158,598 | (29.7) | % | ||||||||||||||||||||||||||
_________________________
NM = Not meaningful
11
In addition to traditional financial metrics, we rely upon certain business and operating metrics to evaluate our business performance and facilitate our operations. Below are the most relevant business and operating metrics for each segment, except for EBITDA and Adjusted EBITDA, which are not presented on a segment basis.
The following tables present the number of Submissions by product for each of the Medicare segments for the periods presented.
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||||||||||||||||
| Submissions | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
| Medicare-Internal | ||||||||||||||||||||||||||
| Medicare Advantage | 176,975 | 439,968 | 482,356 | 793,267 | ||||||||||||||||||||||
| Medicare Supplement | 76 | 471 | 281 | 1,025 | ||||||||||||||||||||||
| Prescription Drug Plans | 5,934 | 16,438 | 11,347 | 22,322 | ||||||||||||||||||||||
| Medicare-Internal Submissions | 182,985 | 456,877 | 493,984 | 816,614 | ||||||||||||||||||||||
| Medicare-External | ||||||||||||||||||||||||||
| Medicare Advantage | 128,529 | 145,616 | 346,900 | 266,795 | ||||||||||||||||||||||
| Medicare Supplement | 179 | 708 | 458 | 2,531 | ||||||||||||||||||||||
| Prescription Drug Plans | 12,440 | 11,628 | 21,314 | 12,344 | ||||||||||||||||||||||
| Medicare-External Submissions | 141,148 | 157,952 | 368,672 | 281,670 | ||||||||||||||||||||||
| Total Submissions | ||||||||||||||||||||||||||
| Medicare Advantage | 305,504 | 585,584 | 829,256 | 1,060,062 | ||||||||||||||||||||||
| Medicare Supplemental | 255 | 1,179 | 739 | 3,556 | ||||||||||||||||||||||
| Prescription Drug Plans | 18,374 | 28,066 | 32,661 | 34,666 | ||||||||||||||||||||||
| Total Medicare Submissions | 324,133 | 614,829 | 862,656 | 1,098,284 | ||||||||||||||||||||||
The following table presents the Sales per Submission by product for the Medicare segments for the periods presented:
| Three months ended Dec. 31, | Twelve months ended Dec. 31, | |||||||||||||||||||||||||
| Sales Per Submission | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
| Medicare Advantage | $ | 918 | $ | 785 | $ | 929 | $ | 813 | ||||||||||||||||||
| Medicare Supplement | $ | 1,221 | $ | 900 | $ | 965 | $ | 853 | ||||||||||||||||||
| Prescription Drug Plans | $ | 108 | $ | 215 | $ | 109 | $ | 215 | ||||||||||||||||||
12