Form 8-K |
HEALTHEQUITY, INC. | ||
Delaware | 7389 | 52-2383166 | ||
(State or other jurisdiction of incorporation or organization) | (Primary Standard Industrial Classification Code Number) | (I.R.S. Employer Identification Number) |
99.1 | Press release issued by HealthEquity, Inc. dated June 6, 2017, announcing financial results for its first quarter ended April 30, 2017. |
HEALTHEQUITY, INC. | |||
Date: June 6, 2017 | By: | /s/ Darcy Mott | |
Name: | Darcy Mott | ||
Title: | Executive Vice President and Chief Financial Officer |
Exhibit no. | Description | |
99.1 | Press release issued by HealthEquity, Inc. dated June 6, 2017, announcing financial results for its first quarter ended April 30, 2017. |
• | Revenue of $55.4 million, an increase of 26% compared to Q1 FY17. |
• | Net income of $14.0 million, an increase of 74% compared to Q1 FY17. |
• | Net income per diluted share of $0.23 compared to $0.14 in Q1 FY17. |
• | Adjusted EBITDA of $22.4 million, an increase of 24% compared to Q1 FY17. |
• | Service revenue of $22.5 million, an increase of 18% compared to Q1 FY17. |
• | Custodial revenue of $19.3 million, an increase of 40% compared to Q1 FY17. |
• | Interchange revenue of $13.6 million, an increase of 21% compared to Q1 FY17. |
• | Custodial Cash Assets of $4.4 billion, an increase of 24% compared to Q1 FY17; and |
• | Custodial Investment Assets of $0.8 billion, an increase of 58% compared to Q1 FY17. |
(in thousands, except par value) | April 30, 2017 | January 31, 2017 | |||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 155,085 | $ | 139,954 | |||
Marketable securities, at fair value | 40,472 | 40,405 | |||||
Total cash, cash equivalents and marketable securities | 195,557 | 180,359 | |||||
Accounts receivable, net of allowance for doubtful accounts of $75 as of April 30, 2017 and January 31, 2017 | 18,988 | 17,001 | |||||
Inventories | 529 | 592 | |||||
Other current assets | 4,069 | 2,867 | |||||
Total current assets | 219,143 | 200,819 | |||||
Property and equipment, net | 6,083 | 5,170 | |||||
Intangible assets, net | 64,683 | 65,020 | |||||
Goodwill | 4,651 | 4,651 | |||||
Deferred tax asset | 6,438 | 1,615 | |||||
Other assets | 1,851 | 1,861 | |||||
Total assets | $ | 302,849 | $ | 279,136 | |||
Liabilities and stockholders’ equity | |||||||
Current liabilities | |||||||
Accounts payable | $ | 1,545 | $ | 3,221 | |||
Accrued compensation | 4,325 | 8,722 | |||||
Accrued liabilities | 4,435 | 3,760 | |||||
Total current liabilities | 10,305 | 15,703 | |||||
Long-term liabilities | |||||||
Other long-term liabilities | 1,700 | 1,456 | |||||
Deferred tax liability | — | 37 | |||||
Total long-term liabilities | 1,700 | 1,493 | |||||
Total liabilities | 12,005 | 17,196 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity | |||||||
Preferred stock, $0.0001 par value, 100,000 shares authorized, no shares issued and outstanding as of April 30, 2017 and January 31, 2017, respectively | — | — | |||||
Common stock, $0.0001 par value, 900,000 shares authorized, 59,904 and 59,538 shares issued and outstanding as of April 30, 2017 and January 31, 2017, respectively | 6 | 6 | |||||
Additional paid-in capital | 238,953 | 232,114 | |||||
Accumulated other comprehensive loss | (191 | ) | (165 | ) | |||
Accumulated earnings | 52,076 | 29,985 | |||||
Total stockholders’ equity | 290,844 | 261,940 | |||||
Total liabilities and stockholders’ equity | $ | 302,849 | $ | 279,136 |
(in thousands, except per share data) | Three months ended April 30, | ||||||
2017 | 2016 | ||||||
Revenue: | |||||||
Service revenue | $ | 22,487 | $ | 18,994 | |||
Custodial revenue | 19,319 | 13,811 | |||||
Interchange revenue | 13,615 | 11,208 | |||||
Total revenue | 55,421 | 44,013 | |||||
Cost of revenue: | |||||||
Service costs | 15,575 | 11,257 | |||||
Custodial costs | 2,801 | 2,356 | |||||
Interchange costs | 3,304 | 2,719 | |||||
Total cost of revenue | 21,680 | 16,332 | |||||
Gross profit | 33,741 | 27,681 | |||||
Operating expenses: | |||||||
Sales and marketing | 4,621 | 4,183 | |||||
Technology and development | 6,242 | 4,625 | |||||
General and administrative | 5,868 | 4,574 | |||||
Amortization of acquired intangible assets | 1,083 | 1,049 | |||||
Total operating expenses | 17,814 | 14,431 | |||||
Income from operations | 15,927 | 13,250 | |||||
Other expense: | |||||||
Other expense, net | (90 | ) | (641 | ) | |||
Total other expense | (90 | ) | (641 | ) | |||
Income before income taxes | 15,837 | 12,609 | |||||
Income tax provision | 1,808 | 4,536 | |||||
Net income | $ | 14,029 | $ | 8,073 | |||
Net income per share: | |||||||
Basic | $ | 0.23 | $ | 0.14 | |||
Diluted | $ | 0.23 | $ | 0.14 | |||
Weighted-average number of shares used in computing net income per share: | |||||||
Basic | 59,720 | 57,820 | |||||
Diluted | 61,400 | 59,399 | |||||
Comprehensive income: | |||||||
Net income | 14,029 | 8,073 | |||||
Other comprehensive loss: | |||||||
Unrealized loss on available-for-sale marketable securities, net of tax | (26 | ) | (39 | ) | |||
Comprehensive income | $ | 14,003 | $ | 8,034 |
Three months ended April 30, | |||||||
(in thousands) | 2017 | 2016 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 14,029 | $ | 8,073 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 3,482 | 2,947 | |||||
Amortization of deferred financing costs and other | 41 | 18 | |||||
Deferred taxes | 3,218 | 34 | |||||
Stock-based compensation | 3,010 | 1,822 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (1,987 | ) | (1,398 | ) | |||
Inventories | 63 | 22 | |||||
Other assets | (1,207 | ) | (4,739 | ) | |||
Accounts payable | (1,545 | ) | (1,241 | ) | |||
Accrued compensation | (4,397 | ) | (5,173 | ) | |||
Accrued liabilities | 625 | 1,164 | |||||
Other long-term liabilities | 244 | 583 | |||||
Net cash provided by operating activities | 15,576 | 2,112 | |||||
Cash flows from investing activities: | |||||||
Purchases of marketable securities | (109 | ) | (86 | ) | |||
Purchase of property and equipment | (1,437 | ) | (321 | ) | |||
Purchase of software and capitalized software development costs | (2,728 | ) | (2,003 | ) | |||
Net cash used in investing activities | (4,274 | ) | (2,410 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from exercise of common stock options | 3,829 | 145 | |||||
Tax benefit from exercise of common stock options | — | 9,278 | |||||
Net cash provided by financing activities | 3,829 | 9,423 | |||||
Increase in cash and cash equivalents | 15,131 | 9,125 | |||||
Beginning cash and cash equivalents | 139,954 | 83,641 | |||||
Ending cash and cash equivalents | $ | 155,085 | $ | 92,766 | |||
Supplemental disclosures of non-cash investing and financing activities: | |||||||
Purchases of property and equipment included in accounts payable or accrued liabilities at period end | $ | 133 | $ | 8 | |||
Purchases of software and capitalized software development costs included in accounts payable or accrued liabilities at period end | 141 | 111 |
Three months ended April 30, | |||||||
(in thousands) | 2017 | 2016 | |||||
Cost of revenue | $ | 491 | $ | 375 | |||
Sales and marketing | 317 | 213 | |||||
Technology and development | 672 | 357 | |||||
General and administrative | 1,530 | 877 | |||||
Total stock-based compensation expense | $ | 3,010 | $ | 1,822 |
April 30, 2017 | April 30, 2016 | % Change | January 31, 2017 | |||||||||
HSA Members | 2,805,280 | 2,228,041 | 26 | % | 2,746,132 | |||||||
Average HSA Members - Year-to-date | 2,782,779 | 2,211,860 | 26 | % | 2,339,091 | |||||||
Average HSA Members - Quarter-to-date | 2,782,779 | 2,211,860 | 26 | % | 2,519,382 | |||||||
HSA Members with investments | 76,996 | 49,761 | 55 | % | 65,906 |
(in thousands, except percentages) | April 30, 2017 | April 30, 2016 | % Change | January 31, 2017 | |||||||||||
Custodial cash | $ | 4,454,928 | $ | 3,597,111 | 24 | % | $ | 4,380,487 | |||||||
Custodial investments | 772,867 | 488,343 | 58 | % | 658,580 | ||||||||||
Total custodial assets | $ | 5,227,795 | $ | 4,085,454 | 28 | % | $ | 5,039,067 | |||||||
Average daily custodial cash - Year-to-date | $ | 4,410,507 | $ | 3,518,081 | 25 | % | $ | 3,661,058 | |||||||
Average daily custodial cash - Quarter-to-date | $ | 4,410,507 | $ | 3,518,081 | 25 | % | $ | 3,854,518 |
Three months ended April 30, | |||||||
(in thousands) | 2017 | 2016 | |||||
Net income | $ | 14,029 | $ | 8,073 | |||
Interest income | (157 | ) | (120 | ) | |||
Interest expense | 67 | 68 | |||||
Income tax provision | 1,808 | 4,536 | |||||
Depreciation and amortization | 2,398 | 1,898 | |||||
Amortization of acquired intangible assets | 1,083 | 1,049 | |||||
Stock-based compensation expense | 3,010 | 1,822 | |||||
Other (1) | 180 | 693 | |||||
Adjusted EBITDA | $ | 22,418 | $ | 18,019 |
(1) | For the three months ended April 30, 2017 and 2016, Other consisted of non-income-based taxes of $88 and $84, other costs of $54 and $24, and acquisition-related costs of $38 and $585, respectively. |
Outlook for the year ending | |
(in millions) | January 31, 2018 |
Net income | $33 - $37 |
Income tax provision | 14 - 15 |
Depreciation and amortization | ~ 12 |
Amortization of acquired intangible assets | ~ 4 |
Stock-based compensation expense | ~ 14 |
Other | ~ 1 |
Adjusted EBITDA | $78 - $83 |
Three months ended | Outlook for the year ending | |||
(in millions, except per share data) | April 30, 2017 | January 31, 2018 | ||
Net income | $14 | $33 - $37 | ||
Stock compensation, net of tax (1) | 2 | ~ 9 | ||
Excess tax benefit due to adoption of ASU 2016-09 | (4 | ) | ~ (4) | |
Non-GAAP net income | $12 | $38 - $42 | ||
Diluted weighted-average shares used in computing GAAP and Non-GAAP per share amounts | 61 | 62 | ||
Non-GAAP net income per diluted share | $0.19 | $0.62 - $0.67 |