News

Financial Highlights

• First quarter revenue of $180.0 million, an increase of 37% from first quarter 2020
• GAAP net loss total of $51.7 million compared to net loss of $8.9 million in first quarter 2020
• Non-GAAP adjusted EBITDA¹ of $34.4 million, an increase of 58% from first quarter 2020

DALLAS and NEW YORK – May 11, 2021 – Signify Health, Inc. (NYSE: SGFY), a leading healthcare platform that leverages advanced analytics, technology and nationwide healthcare networks to create and power value-based payment programs, today announced the Company’s financial results for the first quarter 2021.

“Strong execution against our strategies and continued positive momentum in our Home & Community Services segment drove significant growth in the first quarter,” said Kyle Armbrester, Chief Executive Officer of Signify Health. "Accelerated customer demand for our comprehensive member evaluations and the investments we have made in people and process to handle the increased demand effectively contributed to in-home evaluation volume growth. We continue to expand our commercial capabilities in the Episodes of Care segment to drive growth with new entrants such as commercial plans and employers.”

Mr. Armbrester continued, “Our two highly complementary businesses are focused on reducing healthcare costs through the deployment of services and value-based payment models backed by sophisticated analytics and software, extensive data, and contracted networks of health care providers. For the balance of 2021 and beyond, we will invest in and leverage the collective services of both segments to drive better patient outcomes and advance our mission to transform how healthcare is paid for and delivered so that people can enjoy more healthy, happy days at home.”

First Quarter 2021 Financial Results

• Total revenue for the first quarter increased 37% to $180.0 million, up from $131.7 million in the same period a year ago. Overall growth in the first quarter 2021 was driven by a 48% increase in Home & Community Services (HCS) segment revenue to $152.4 million. Episodes of Care Services (ECS) segment first quarter revenue declined 3% to $27.6 million compared to a year ago.
• The strong HCS revenue in the first quarter was due to an increase in in-home evaluations (IHE) volume to approximately 462,000 compared to approximately 303,000 in the first quarter of 2020.
• ECS first quarter revenue was marginally lower, as expected, due to the impact of COVID-19 on program size.
• First quarter total net loss was $51.7 million compared to a net loss of $8.9 million for the same period a year ago. Net loss included $56.8 million of other expense related to the remeasurement of the fair value of our Equity Appreciation Rights (EAR), reflecting the Company’s post IPO valuation.
• Non-GAAP Adjusted EBITDA¹ for the first quarter increased 58% to $34.4 million, compared to $21.9 million for the first quarter 2020, driven primarily by HCS revenue growth.
• Non-GAAP Adjusted EBITDA margin¹ for the first quarter was 19.1%, a 250 basis point improvement from the comparable year ago period.

2021 Outlook
Signify Health is maintaining 2021 guidance, although based on first quarter results the Company is trending towards the higher end of the range for total revenue and adjusted EBITDA. The following estimates are for the full year 2021 and assume that the COVID-19 situation continues to improve in 2021:

• Total GAAP revenue in the range of $725 million to $760 million (reduced by approximately $19.7 million relating to the EARs); and
• Total adjusted EBITDA¹ in the range of $150 million to $160 million.

Signify Health is also maintaining estimates for the following key performance indicators for full year 2021:

• HCS segment IHEs in the range of 1.70 million to 1.75 million;
• ECS segment weighted average program size in the range of $5.1 billion to $5.3 billion; and
• ECS segment weighted average savings rate improvement of 25-50 basis points from 2020.

¹Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. Refer to the reconciliation in “Non-GAAP Financial Measures.” We have not reconciled 2021 guidance for adjusted EBITDA to net income (loss), the most directly comparable GAAP measure, and have not provided forward-looking guidance for net income (loss) because of the uncertainty around certain items that may impact net income (loss), including, among others, stock-based compensation and the fair valuation of the EARs, that are not within our control or cannot be reasonably predicted.

Conference Call Information
Signify Health will host a conference call to discuss the Company’s first quarter 2021 results on May 12, 2021 at 9:00am ET. A live audio webcast of the conference call may be accessed through the investor relations section of Signify Health’s website at investors.signifyhealth.com/events/default.aspx and will be available for replay through July 12, 2021.

About Signify Health
Signify Health is a leading healthcare platform that leverages advanced analytics, technology, and nationwide healthcare provider networks to create and power value-based payment programs. Our mission is to transform how care is paid for and delivered so that people can enjoy more healthy, happy days at home. Our solutions support value-based payment programs by aligning financial incentives around outcomes, providing tools to health plans and healthcare organizations designed to assess and manage risk and identify actionable opportunities for improved patient outcomes, coordination and cost-savings. Through our platform, we coordinate what we believe is a holistic suite of clinical, social, and behavioral services to address an individual’s healthcare needs and prevent adverse events that drive excess cost, all while shifting services towards the home.

Forward Looking Statements
This press release contains forward-looking statements. All statements other than statements of historical fact included in this press release are forward-looking statements. These statements may be preceded by, followed by or include the words “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business, our plan to drive better patient outcomes, our 2021 Outlook, including our 2021 estimates for total GAAP revenue, total Adjusted EBITDA, in-home evaluations, program size and weighted average savings rate improvements, and our plan to utilize the proceeds from our IPO to expand our investment in value-based payment programs and in our product portfolio. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements.

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Some of the factors that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include: the COVID-19 pandemic and whether the pandemic will continue to subside in 2021; our dependence upon a limited number of key customers; our dependence on certain key government programs; our failure to maintain and grow our network of high-quality providers; our failure to continue to innovate and provide services that are useful to customers and achieve and maintain market acceptance; our limited operating history with certain of our solutions; our failure to compete effectively; the length and unpredictability of our sales cycle; failure of our existing customers to continue or renew their contracts with us; failure of service providers to meet its obligations to us; seasonality that may cause fluctuations in our sales, cash flows and results of operations; our failure to achieve or maintain profitability; our revenue not growing at the rates they historically have, or at all; our failure to successfully execute on our growth initiatives, business strategies, or operating plans, including growth in our Commercial Episodes business; our failure to successfully launch new products; our failure to diversify sources of revenues and earnings; inaccurate estimates and assumptions used to determine the size of our total addressable market; changes in accounting principles applicable to us; incorrect estimates or judgments relating to our critical accounting policies; increases in our level of indebtedness; our failure to effectively adapt to changes in the healthcare industry, including changes in the rules governing Medicare or other federal healthcare programs; our failure to adhere to complex and evolving governmental laws and regulations; our failure to comply with current and future federal and state privacy, security and data protection laws, regulations or standards; our employment of and contractual relationships with our providers subjecting us to licensing or other regulatory risks, including recharacterization of our contracted providers as employees; adverse findings from inspections, reviews, audits and investigations from health plans; inadequate investment in or maintenance of our operating platform and other information technology and business systems; our ability to develop and/or enhance information technology systems and platforms to meet our changing customer needs; higher than expected investments in our business including, but not limited to, investments in our technology and operating platform, which could reduce our profitability; security breaches or incidents, loss or misuse of data, a failure in or breach of our operational or security systems or other disruptions; disruptions in our disaster recovery systems or management continuity planning; our ability to comply with, and changes to, laws, regulations and standards relating to privacy or data protection; our ability to obtain, maintain, protect and enforce our intellectual property; our dependence on distributions from Cure TopCo, LLC, our operating subsidiary, to fund dividend payments, if any, and to pay our taxes and expenses, including payments under the Tax Receivable Agreement; the control certain equity holders have over us and our status as a controlled company; our ability to realize any benefit from our organizational structure; risks associated with acquiring other businesses including our ability to effectively integrate the operations and technologies of the acquired business; risks associated with an increase in our indebtedness; and the other risk factors described under “Risk Factors” in our filings with the Securities and Exchange Commission (“SEC”), including our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which are available free of charge on the SEC's website at: www.sec.gov.

All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements. In addition, all forward-looking statements speak only as of the date of this press release. We undertake no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise other than as required under the federal securities laws.

About Non-GAAP Financial Measures
This press release contains certain financial measures not presented in accordance with generally accepted accounting principles in the United State (“GAAP”), including Adjusted EBITDA and Adjusted EBITDA margin, which are used by management in making operating decisions, allocating financial resources, and internal planning and forecasting and for business strategy purposes. Adjusted EBITDA and Adjusted EBITDA margin are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing our financial results. Therefore, these measures should not be considered in isolation or as an alternative to GAAP measures. Our presentation of Adjusted EBITDA and Adjusted EBITDA margin may not be comparable to similarly-titled measures used by other companies. Management believes that such measures are commonly reported by issuers and widely used by investors as indicators of a company’s operating performance. Please refer to the reconciliations of Adjusted EBITDA and Adjusted EBITDA margin to the most directly comparable financial measures prepared in accordance with GAAP below.