GoHealth (GOCO) 8-K GoHealth Reports Third Quarter 2020 Results and Increases 2020 Outlook

Exhibit 99.1

GoHealth Reports Third Quarter 2020 Results and Increases 2020 Outlook

As a Result of Strong Medicare Enrollments and Operating Leverage

CHICAGO, November 11, 2020 — GoHealth, Inc. (GoHealth or the Company) (Nasdaq: GOCO), a leading health insurance marketplace, announced financial results for the three and nine months ended September 30, 2020.

• Third quarter 2020 net revenues of $163.4 million increased 52% compared to the prior year period, and year-to-date 2020 net revenues of $431.4 million increased 72% compared to the prior year period

• Third quarter 2020 net loss of $206.5 million, included $209.3 million of accelerated vesting of certain equity awards in connection with the IPO¹, and year-to-date 2020 net loss of $230.3 million, included $209.3 million of accelerated vesting of certain equity awards in connection with the IPO¹

• Third quarter 2020 adjusted EBITDA² of $39.3 million increased 142% compared to the prior year period, and year-to-date 2020 adjusted EBITDA of $101.1 million increased 149% compared to the prior year period

• The Company also updated its full year 2020 outlook, and now expects net revenues of $850-$890 million and adjusted EBITDA² of $270-$290 million given the robust start to the Annual Enrollment Period, with 83% submission growth in October and a 4% improvement in agent conversion

Clint Jones, co-founder and CEO said, “GoHealth’s third quarter adjusted EBITDA growth of 142% was powered by 52% revenue growth and strong operating leverage as we continue to efficiently scale the business. These excellent results marked a continuation of year-to-date trends as consumers increasingly turn to GoHealth’s leading DTC platform to find the best Medicare policies to meet their unique needs.”

Jones continued, “Our proprietary, vertically-integrated technology platform and high performance marketing organization allow us to efficiently grow our carrier partners’ Medicare membership base. This growth is guided by our LTV/CAC focus, ensuring that we generate quick payback periods. Our TeleCare team administers GoHealth’s Encompass programs on behalf of our carrier partners and further supports consumer persistency by proactively engaging with and educating consumers about their benefits through Plan Fit Check calls. The strength and differentiation of our business model is evident in our third quarter operating cash flow of $33 million as well as a 5% increase in LTVs, fueled by improving persistency trends.”

Year-To-Date 2020 Highlights

• Total Medicare Submitted Policies³ grew 103% during the first nine months to 355,544

• Medicare—Internal revenue increased 172% to $316.2 million

• Medicare—Internal profit increased 191% to $123.9 million

• Adjusted EBITDA growth of 149% as margins expanded from 16.2% to 23.4%

• LTV/CAC⁴ for the Medicare-Internal segment increased from 2.5x to 3.0x during the first nine months of 2020, driven by lower marketing costs per opportunity and higher agent sales conversion

• LTV per carrier approved Medicare Advantage submission increased 2% from $899 to $913 during the first nine months of 2020

• 2% improvement in persistency during the first nine months compared to the prior year period

• LTV per carrier-approved Medicare Advantage submission increased 5% from $939 to $987 during the third quarter

• Generated positive year-to-date cash flow from operations of $28.8 million while increasing commission receivables by $117.9 million

• 76% increase in Medicare – Internal licensed agents from 849 to 1,493 as of September 30, 2020 and made substantial investments in training ahead of the Annual Enrollment Period

• Year over year new agent productivity +13%

• TeleCare team of 275 agents ramped up retention conversations including Plan Fit Checks to maximize satisfaction and improve recapture rates into AEP

• Expanded Enterprise programs to 26, including the addition of six new Encompass initiatives across multiple partners

• Significantly expanded carrier footprint with UnitedHealthcare, Aetna, Cigna, Kaiser Permanente and Allwell, providing consumers with market-leading plan options in almost all counties in the United States

Financial Outlook

The trajectory of the US economy remains challenging to predict, particularly given the heightened uncertainty associated with the COVID-19 pandemic. During this time, demand for healthcare has demonstrated great resilience, and we believe that the COVID-19 pandemic has created favorable industry dynamics for technology-driven direct-to-consumer models such as GoHealth’s insurance marketplace. The Company has updated its outlook for the fiscal year ending December 31, 2020 based on current market conditions and expectations:

• Full year 2020 net revenue of $850 - $890 million, representing year-over-year growth of 58% - 65%

• Full year 2020 adjusted EBITDA of $270 - $290 million, representing year-over-year growth of 58% - 70%

Jones concluded, “We are increasing our expectations for fiscal 2020 given our robust start to the Annual Enrollment Period, with October submissions up 83% over the prior October and well ahead of the 53% implied midpoint of revenue growth for the fourth quarter. The Medicare market is large and growing quickly, and we are just beginning to realize our long-term growth opportunity as we create value for our partners and deliver great results for our shareholders.”

Conference Call Details

The Company will host a conference call today, Wednesday, November 11, 2020 at 5:00 pm (ET) to discuss its financial results. A live audio webcast and a supplemental presentation will be available online at https://investors.gohealth.com. The conference call can also be accessed by dialing 1-833-519-1310 for U.S. participants, or 1-914-800-3876 for international participants, and referencing participant code 4374976. A replay of the call will be available via webcast for on-demand listening shortly after the completion of the call, at the same web link.

About GoHealth

As a leading health insurance marketplace, 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 carrier that is best for them. Since its inception, GoHealth has enrolled millions of people in Medicare and individual and family plans. For more information, visit https://www.gohealth.com

¹  Represents non-cash share-based compensation expense relating to the accelerated vesting of performance-vesting units in connection with the IPO for the three months ended September 30, 2020

²  Adjusted EBITDA is a non-GAAP measure. For a definition of Adjusted EBITDA and a reconciliation to the most comparable GAAP measure, please refer to the appendix.

³  Total Medicare Advantage Submitted Policies includes Commissionable and non-Commissionable Policies.

⁴  LTV/CAC defined as (i) aggregate commissions estimated to be collected over the estimated life of all Approved Submissions based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints, or LTV, divided by (ii) the cost to convert a prospect into a customer less other non-commission carrier revenue for such period, or CAC.

Investor Relations:

Jay Koval, VP of Investor Relations

IR@gohealth.com

Media Relations:

Pressinquiries@gohealth.com

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this press release may be forward-looking statements. Statements regarding the Company’s future results of operations and financial position, business strategy and plans and objectives of management for future operations, including, among others, statements regarding expected financial performance and operational performance for the fiscal year 2020, including with respect to revenue and Adjusted EBITDA, and the Company’s performance during the Annual Enrollment Period, including with respect to agent conversion and implied growth for the fourth quarter of 2020, are forward-looking statements. In some cases, you can identify forward-looking statements by terms, such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “targets,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” 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 the Company believes 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 the Company’s actual results to differ materially from those indicated in these forward-looking statements, including, but are not limited to, the following: the Company’s ability to comply with the numerous, complex and frequently changing laws regulating the marketing and sale of Medicare plans; the potential for an adverse change in the Company’s relationships with carriers, including a loss of a carrier relationships; failure to grow the Company’s customer base or retain its existing customers; carriers’ ability to reduce commissions paid to the Company and adversely change their underwriting practices; significant consolidation in the healthcare industry which could adversely alter the Company’s relationships with carriers; information technology systems failures or capacity constraints interrupting the Company’s operations; factors that adversely impact the Company’s estimate of LTV; the Company’s dependence on agents to sell insurance plans; changes in the health insurance system and laws and regulation governing health insurance markets; the inability to effectively advertise the Company’s products; and our ability to successfully implement our business plan during a global economic downturn caused by the COVID-19 pandemic.

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 Company’s Quarterly Report on Form 10-Q for the third quarter ended September 30, 2020 filed with the SEC. If one or more events related to these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, actual results may differ materially from what the Company anticipates. Many of the important factors that will determine these results are beyond the Company’s 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, the Company does 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, the Company cannot assess the impact of each factor on its 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, or 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.

Adjusted EBITDA represents EBITDA as further adjusted for share-based compensation, expense related to the accelerated vesting of certain equity awards, change in fair value of contingent consideration liability, Centerbridge Acquisition costs, severance costs and incremental organizational costs in connection with the IPO. 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 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. 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 and Adjusted EBITDA to its most directly comparable GAAP financial measure, 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.

Management has provided its outlook regarding adjusted EBITDA, which is a non-GAAP financial measure and excludes certain charges. Management has not reconciled these non-GAAP financial measures to the corresponding GAAP financial measures because guidance for the various reconciling items are not provided. Management is unable to provide guidance for these reconciling items because we cannot determine their probable significance, as certain items are outside of our control and cannot be reasonably predicted since these items could vary significantly from period to period. Accordingly, reconciliations to the corresponding GAAP financial measures are not available without unreasonable effort.

“LTV/CAC” refers to the Lifetime Value of Commissions per Consumer Acquisition Cost, which we define as (i) aggregate commissions estimated to be collected over the estimated life of all commissionable Approved Submissions for the relevant period based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints, or LTV, divided by (ii) the cost to convert a prospect into a customer less other noncommission carrier revenue for such period, or CAC. CAC is comprised of cost of revenue, marketing and advertising expenses and customer care and enrollment expenses less other revenue and is presented on a per commissionable Approved Submission basis. “Approved Submissions” refer to Submitted Policies approved by carriers for the identified product during the indicated period. “LTV Per Approved Submission” refers to the Lifetime Value of Commissions per Approved Submission, which we define as (i) aggregate commissions estimated to be collected over the estimated life of all commissionable Approved Submissions for the relevant period based on multiple factors, including but not limited to, contracted commission rates, carrier mix and expected policy persistency with applied constraints, divided by (ii) the number of commissionable Approved Submissions for such period.

Combined Results

On September 13, 2019, Centerbridge Capital Partners III, L.P., indirectly through a subsidiary of GoHealth Holdings, LLC, (formerly known as Blizzard Parent, LLC), an entity formed in contemplation of the acquisition, acquired a 100% interest in Norvax, LLC. We refer to this transaction as the “Centerbridge Acquisition.” As a result of the Centerbridge Acquisition, the Company’s financial results for the three and nine months ended September 30, 2019 are presented for two periods, the Predecessor and Successor periods, which relate to the period preceding the acquisition on September 13, 2019 and the period succeeding the acquisition, respectively. The Company’s financial results for the periods from July 1, 2019 through September 12, 2019 and from January 1, 2019 through September 12, 2019 are referred to as those of the “Predecessor” period. The Company’s financial results for the period from September 13, 2019 through September 30, 2019, the three months ended September 30, 2020 and the nine months ended September 30, 2020 are referred to as those of the “Successor” period. The Company’s results of operations as reported in our Consolidated Financial Statements for these periods are prepared in accordance with GAAP. Although GAAP requires that we report on the Company’s results for the period from July 1, 2019 through September 12, 2019, from January 1, 2019 through September 12, 2019 and the period from September 13, 2019 through September 30, 2019 separately, management views the Company’s operating results for the three and nine months ended September 30, 2019 by combining the results of the applicable Predecessor and Successor periods because such presentation provides the most meaningful comparison to its results for the three and nine months ended September 30, 2020.

The Company cannot adequately benchmark the operating results of the period from September 13, 2019 through September 30, 2019 against any of the current periods reported in its Consolidated Financial Statements without combining it with the period from July 1, 2019 through September 12, 2019 and the period from January 1, 2019 through September 12, 2019 and does not believe that reviewing the results of this period in isolation would be useful in identifying trends in or reaching conclusions regarding the Company’s overall operating performance. Management believes that the key performance metrics such as revenue, net (loss) income and Adjusted EBITDA for the Successor period when combined with the Predecessor period provides more meaningful comparisons to other periods and are useful in identifying current business trends. Accordingly, in addition to presenting the Company’s results of operations as reported in our Consolidated Financial Statements in accordance with GAAP, the tables and discussion throughout this press release also present the combined results for the three and nine months ended September 30, 2019.

The combined results for the three months ended September 30, 2019, which we refer to herein as the results for the “three months ended September 30, 2019” represent the sum of the reported amounts for the Predecessor period from July 1, 2019 through September 12, 2019 and the Successor period from September 13, 2019 through September 30, 2019. The combined results for the nine months ended September 30, 2019, which we refer to herein as the results for the “nine months ended September 30, 2019” represent the sum of the reported amounts for the Predecessor period from January 1, 2019 through September 12, 2019 and the Successor period from September 13, 2019 through September 30, 2019. The combined results do not reflect the actual results the Company would have achieved had the Centerbridge Acquisition occurred on January 1, 2019 and may not be indicative of future results. These combined results are not considered to be prepared in accordance with GAAP and have not been prepared on a pro forma basis, which would reflect pro forma adjustments including, but not limited to: amortization expense for intangible assets, share-based compensation expense related to the Centerbridge Acquisition and the IPO, and transaction-related costs related to the Centerbridge Acquisition and the IPO.

The following table sets forth the components of our results of operations for the periods indicated (unaudited):

	Successor									Predecessor			Non-GAAP Combined
	Three Months Ended Sep 30, 2020						Period from Sep 13, 2019 through Sep 30, 2019			Period from Jul 1, 2019 through Sep 12, 2019			Three Months Ended Sep 30, 2019
(in thousands, except percentages, share and per share amounts)	Dollars			% of Net Revenues			Dollars			Dollars			Dollars			% of Net Revenues			$ Change			% Change
Net revenues:
Commission	$	101,390			62.1	%	$	13,723		$	64,542		$	78,265			73.0	%	$	23,125			29.5	%
Enterprise		61,970			37.9	%		6,067			22,868			28,935			27.0	%		33,035			114.2	%
Net revenues		163,360			100.0	%		19,790			87,410			107,200			100.0	%		56,160			52.4	%
Operating expenses:
Cost of revenue		25,827			15.8	%		4,737			25,055			29,792			27.8	%		(3,965	)		-13.3	%
Marketing and advertising		62,848			38.5	%		7,140			21,332			28,472			26.6	%		34,376			120.7	%
Customer care and enrollment		52,896			32.4	%		4,625			19,396			24,021			22.4	%		28,875			120.2	%
Technology		39,520			24.2	%		518			31,856			32,374			30.2	%		7,146			22.1	%
General and administrative		156,551			95.8	%		2,286			65,123			67,409			62.9	%		89,142			132.2	%
Amortization of intangible assets		23,514			14.4	%		4,703			—			4,703			4.4	%		18,811			400.0	%
Acquisition related transaction costs		—			—			6,245			1,968			8,213			7.7	%		(8,213	)		-100.0	%
Total operating expenses		361,156			221.1	%		30,254			164,730			194,984			181.9	%		166,172			85.2	%
(Loss) income from operations		(197,796	)		-121.1	%		(10,464	)		(77,320	)		(87,784	)		-81.9	%		(110,012	)		125.3	%
Interest expense		8,636			5.3	%		1,289			31			1,320			1.2	%		7,316			554.2	%
Other (income) expense		2			0.0	%		(10	)		67			57			0.1	%		(55	)		-96.5	%
(Loss) income before income taxes		(206,434	)		-126.4	%		(11,743	)		(77,418	)		(89,161	)		-83.2	%		(117,273	)		131.5	%
Income tax expense (benefit)		62			0.0	%		(37	)		(78	)		(115	)		-0.1	%		177			-153.9	%
Net (loss) income	$	(206,496	)		-126.4	%	$	(11,706	)	$	(77,340	)	$	(89,046	)		-83.1	%	$	(117,450	)		131.9	%
Net loss attributable to noncontrolling interests		(150,076	)		NM
Net loss attributable to GoHealth, Inc.	$	(56,420	)		NM
Net loss per share:
Net loss per share of Class A common stock—basic and diluted	$		(0.65)
Weighted-average shares of Class A common stock outstanding - basic and diluted		84,182,961
Non-GAAP Financial Measures:
EBITDA	$	(173,021	)				$	(5,659	)	$	(76,183	)	$	(81,842	)
Adjusted EBITDA	$	39,284					$	682		$	15,569		$	16,251
Adjusted EBITDA margin		24.0	%					3.4	%		17.8	%		15.2	%

* NM = Not meaningful

The following table sets forth the reconciliations of GAAP net loss to EBITDA and Adjusted EBITDA for the periods indicated:

	Successor						Predecessor			Non-GAAP Combined
	Three Months Ended Sep 30, 2020			Period from Sep 13, 2019 through Sep 30, 2019			Period from Jul 1, 2019 through Sep 12, 2019			Three Months Ended Sep 30, 2019
(in thousands)	Dollars			Dollars			Dollars			Dollars
Net revenues	$	163,360		$	19,790		$	87,410		$	107,200
Net loss	$	(206,496	)	$	(11,706	)	$	(77,340	)	$	(89,046	)
Interest expense		8,636			1,289			31			1,320
Income tax (benefit) expense		62			(37	)		(78	)		(115	)
Depreciation and amortization expense		24,777			4,795			1,204			5,999
EBITDA		(173,021	)		(5,659	)		(76,183	)		(81,842	)
Share-based compensation expense (1)		2,770			—			—			—
Accelerated vesting of certain equity awards (2)		209,300			—			87,060			87,060
Centerbridge Acquisition costs (3)		—			6,245			4,609			10,854
IPO transaction costs (4)		235			—			—			—
Severance costs (5)		—			96			83			179
Adjusted EBITDA	$	39,284		$	682		$	15,569		$	16,251
Adjusted EBITDA margin		24.0	%		3.4	%		17.8	%		15.2	%

(1) Represents non-cash share-based compensation expense relating to stock options, restricted stock units and time-vesting units.

(2) Represents non-cash share-based compensation expense relating to the accelerated vesting of performance-vesting units in connection with the IPO for the three months ended September 30, 2020 and the accelerated vesting of profit interests and incentive share units in connection with the Centerbridge Acquisition for the period from July 1, 2019 through September 12, 2019.

(3) Represents legal, accounting, consulting, and other costs related to the Centerbridge Acquisition.

(4) Represents legal, accounting, consulting, and other indirect costs associated with the Company’s IPO.

(5) Represents costs associated with the termination of employment.

The following table summarizes share based compensation by operating function:

	Successor				Predecessor		Successor				Predecessor
	Three Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from July 1, 2019 through Sep 12, 2019		Nine Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from Jan 1, 2019 through Sep 12, 2019
Marketing and advertising	$	24,709	$	—	$	1,674	$	24,829	$	—	$	1,674
Customer care and enrollment		11,993		—		—		12,050		—		—
Technology		32,748		—		27,059		32,907		—		27,059
General and administrative		142,620		—		58,327		143,360		—		58,327
Total share-based compensation expense	$	212,070	$	—	$	87,060	$	213,146	$	—	$	87,060

The following table sets forth the components of our results of operations for the periods indicated (unaudited):

	Successor									Predecessor			Non-GAAP Combined
	Nine Months Ended Sep 30, 2020						Period from Sep 13, 2019 through Sep 30, 2019			Period from Jan 1, 2019 through Sep 12, 2019			Nine Months Ended Sep 30, 2019
(in thousands, except percentages, share and per share amounts)	Dollars			% of Net Revenues			Dollars			Dollars			Dollars			% of Net Revenues			$ Change				% Change
Net revenues:
Commission	$	310,506			72.0	%	$	13,723		$	175,834		$	189,557			75.6	%	$	120,949				63.8	%
Enterprise		120,921			28.0	%		6,067			55,176			61,243			24.4	%		59,678				97.4	%
Net revenues		431,427			100.0	%		19,790			231,010			250,800			100.0	%		180,627				72.0	%
Operating expenses:
Cost of revenue		104,520			24.2	%		4,737			79,169			83,906			33.5	%		20,614				24.6	%
Marketing and advertising		110,556			25.6	%		7,140			37,769			44,909			17.9	%		65,647				146.2	%
Customer care and enrollment		105,267			24.4	%		4,625			49,149			53,774			21.4	%		51,493				95.8	%
Technology		49,818			11.5	%		518			40,312			40,830			16.3	%		8,988				22.0	%
General and administrative		177,400			41.1	%		2,286			79,219			81,505			32.5	%		95,895				117.7	%
Change in fair value of contingent consideration liability		19,700			4.6	%		—			—			—			—			19,700				NM
Amortization of intangible assets		70,543			16.4	%		4,703			—			4,703			1.9	%		65,840				1400.0	%
Acquisition related transaction costs		—			—			6,245			2,267			8,512			3.4	%		(8,512	)			-100.0	%
Total operating expenses		637,804			147.8	%		30,254			287,885			318,139			126.8	%		319,665				100.5	%
(Loss) income from operations		(206,377	)		-47.8	%		(10,464	)		(56,875	)		(67,339	)		-26.8	%		(139,038	)			206.5	%
Interest expense		24,378			5.7	%		1,289			140			1,429			0.6	%		22,949				1605.9	%
Other (income) expense		(494	)		-0.1	%		(10	)		114			104			0.0	%		(598	)			-575.0	%
(Loss) income before income taxes		(230,261	)		-53.4	%		(11,743	)		(57,129	)		(68,872	)		-27.5	%		(161,389	)			234.3	%
Income tax expense (benefit)		38			0.0	%		(37	)		(66	)		(103	)		0.0	%		141				-136.9	%
Net (loss) income	$	(230,299	)		-53.4	%	$	(11,706	)	$	(57,063	)	$	(68,769	)		-27.4	%	$	(161,530	)			234.9	%
Net loss attributable to noncontrolling interests		(150,076	)		NM
Net loss attributable to GoHealth, Inc.	$	(80,223	)		NM
Net loss per share:
Net loss per share of Class A
common stock—basic and diluted	$	(0.65	)
Weighted-average shares of Class A common stock outstanding - basic and diluted		84,182,961																				��
Non-GAAP Financial Measures:
EBITDA	$	(132,441	)				$	(5,659	)	$	(52,742	)	$	(58,401	)
Adjusted EBITDA	$	101,141					$	682		$	39,973		$	40,655
Adjusted EBITDA margin		23.4	%					3.4	%		17.3	%		16.2	%

* NM = Not meaningful

The following table sets forth the reconciliations of GAAP net loss to EBITDA and Adjusted EBITDA for the periods indicated:

	Successor						Predecessor			Non-GAAP Combined
	Nine Months Ended Sep 30, 2020			Period from Sep 13, 2019 through Sep 30, 2019			Period from Jan 1, 2019 through Sep 12, 2019			Nine Months Ended Sep 30, 2019
(in thousands)	Dollars			Dollars			Dollars			Dollars
Net revenues	$	431,427		$	19,790		$	231,010		$	250,800
Net loss	$	(230,299	)	$	(11,706	)	$	(57,063	)	$	(68,769	)
Interest expense		24,378			1,289			140			1,429
Income tax (benefit) expense		38			(37	)		(66	)		(103	)
Depreciation and amortization expense		73,442			4,795			4,247			9,042
EBITDA		(132,441	)		(5,659	)		(52,742	)		(58,401	)
Share-based compensation expense (1)		3,846			—			—			—
Accelerated vesting of certain equity awards (2)		209,300			—			87,060			87,060
Change in fair value of contingent consideration liability (3)		19,700			—			—			—
Centerbridge Acquisition costs (4)		—			6,245			4,908			11,153
IPO transaction costs (5)		659			—			—			—
Severance costs (6)		77			96			747			843
Adjusted EBITDA	$	101,141		$	682		$	39,973		$	40,655
Adjusted EBITDA margin		23.4	%		3.4	%		17.3	%		16.2	%

(1) Represents non-cash share-based compensation expense relating to stock options, restricted stock units and time-vesting units.

(2) Represents non-cash share-based compensation expense relating to the accelerated vesting of performance-vesting units in connection with the IPO for the nine months ended September 30, 2020 and the accelerated vesting of profit interests and incentive share units in connection with the Centerbridge Acquisition for the period from January 1, 2019 through September 12, 2019.

(3) Represents the change in fair value of the contingent consideration liability due to the predecessor owners of the Company arising from the Centerbridge Acquisition.

(4) Represents legal, accounting, consulting, and other costs related to the Centerbridge Acquisition.

(5) Represents legal, accounting, consulting, and other indirect costs associated with the Company’s IPO.

(6) Represents costs associated with the termination of employment.

GoHealth, Inc.

Condensed Consolidated Balance Sheets

(dollars in thousands, except share and per share amounts)

	Successor			Successor
	September 30, 2020			December 31, 2019
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	294,598		$	12,276
Accounts receivable, net of allowance for doubtful accounts of $522 in 2020 and $904 in 2019		7,921			24,461
Commissions receivable – current		95,122			101,078
Prepaid expenses and other current assets		19,530			5,954
Total current assets		417,171			143,769
Commissions receivable – non-current		405,697			281,853
Property, equipment, and capitalized software, net		15,463			6,339
Intangible assets, net		712,240			782,783
Goodwill		386,553			386,553
Other long-term assets		1,134			998
Total assets	$	1,938,258		$	1,602,295
Liabilities and stockholders/members’ equity
Current liabilities:
Accounts payable	$	9,181		$	13,582
Accrued liabilities		20,775			22,568
Commissions payable – current		52,029			56,003
Deferred revenue		55,406			15,218
Current portion of debt		4,170			3,000
Other current liabilities		3,765			2,694
Total current liabilities		145,326			113,065
Non-current liabilities:
Commissions payable – non-current		129,446			97,489
Long-term debt, net of current portion		396,817			288,233
Contingent consideration		—			242,700
Other non-current liabilities		3,500			664
Total non-current liabilities		529,763			629,086
Commitments and contingencies (Note 11)
Stockholders’/members’ equity:
Members’ interest		—			860,161
Class A common stock – $0.0001 par value; 1,100,000,000 shares authorized; 84,182,961 shares issued and outstanding at September 30, 2020		8			—
Class B common stock – $0.0001 par value; 690,000,000 shares authorized; 230,722,681 shares issued and outstanding at September 30, 2020		23			—
Preferred stock – $0.0001 par value; 20,000,000 shares authorized; no shares issued and outstanding at September 30, 2020		—			—
Additional paid-in capital		392,491			—
Accumulated other comprehensive loss		(85	)		(17	)
Accumulated deficit		(54,758	)
Total stockholders’ equity attributable to GoHealth, Inc./members’ equity		337,679			860,144
Non-controlling interests		925,490			—
Total stockholders’/members’ equity		1,263,169			860,144
Total liabilities and stockholders’/members’ equity	$	1,938,258		$	1,602,295

GoHealth, Inc.

Condensed Consolidated Statements of Cash Flows

(dollars in thousands, unaudited)

	Successor						Predecessor
	Nine Months Ended September 30, 2020			Period from September 13, 2019 through September 30, 2019			Period from January 1, 2019 through September 12, 2019
Operating activities:
Net loss	$	(230,299	)	$	(11,706	)	$	(57,063	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Share-based compensation		213,146			—			87,060
Depreciation and amortization		2,899			92			4,247
Amortization of intangible assets		70,543			4,703			—
Amortization of debt discount and issuance costs		1,744			79			—
Change in fair value of contingent consideration		19,700			—			—
Other non-cash items		(1,100	)		285			150
Changes in assets and liabilities:
Accounts receivable		17,552			(122	)		(108	)
Commissions receivable		(117,888	)		(15,405	)		(63,448	)
Prepaid expenses and other assets		(13,576	)		(140	)		1,325
Accounts payable		(4,402	)		3,276			(1,981	)
Accrued liabilities		(1,793	)		(5,028	)		17,860
Deferred revenue		40,188			18,098			1,926
Commissions payable		27,983			8,283			19,228
Other liabilities		4,138			13,728			85
Net cash provided by operating activities		28,835			16,143			9,281
Investing activities:
Acquisition of business, net of cash		—			(807,591	)		—
Purchases of property, equipment and software		(12,023	)		(813	)		(5,597	)
Net cash used in investing activities		(12,023	)		(808,404	)		(5,597	)
Financing activities:
Proceeds from issuance of Class A common stock sold in initial public offering, net of offering costs		852,407			—			—
Payment of partial consideration of the Blocker Merger		(96,165	)		—			—
Purchase of LLC Interests		(508,320	)		—			—
Settlement of Senior Preferred Earnout Units		(100,000	)		—			—
Issuance of preferred units		—			541,263			—
Proceeds received upon issuance of common units		10,000			—			—
Borrowings under term loans		117,000			300,000			—
Principal payments under term loans		(2,835	)		—			—
Borrowings under revolving credit facilities		—			—			56,534
Payments under revolving credit facilities		—			—			(59,915	)
Debt issuance cost payments		(6,291	)		(9,283	)		—
Principal payments under capital lease obligations		(218	)		(270	)		(68	)
Net cash provided by (used in) financing activities		265,578			831,710			(3,449	)
Effect of exchange rate changes on cash		(68	)		(2	)		(32	)
Increase in cash and cash equivalents		282,322			39,447			203
Cash and cash equivalents at beginning of period		12,276			708			505
Cash and cash equivalents at end of period	$	294,598		$	40,155		$	708
Supplemental disclosure of cash flow information:
Non-cash investing and financing activities:
Purchases of property, equipment and software included in accounts payable	$	1,104		$	277		$	113
Purchases of property, equipment and software under capital leases	$	—		$	—		$	744
Issuance of senior preferred earnout units to settle contingent consideration liability	$	100,000		$	—		$	—
Issuance of common A and B units to settle contingent consideration liability	$	100,000		$	—		$	—
Issuance of Class A and Class B common stock in connection with Reorganization Transactions	$	30		$	—		$	—
Settlement of contingent consideration liability	$	62,400		$	—		$	—

Segment Information

The following table sets forth operating segment results for the periods indicated:

	Successor									Predecessor			Non-GAAP Combined
	Three Months Ended Sep 30, 2020						Period from Sep 13, 2019 through Sep 30, 2019			Period from Jul 1, 2019 through Sep 12, 2019			Three Months Ended Sep 30, 2019
(in thousands, except percentages)	Dollars			% of Net Revenues			Dollars			Dollars			Dollars			% of Net Revenues			$ Change			% Change
Net revenues:
Medicare - Internal	$	133,723			81.9	%	$	14,208		$	48,872		$	63,080			58.8	%	$	70,643			112.0	%
Medicare - External		20,252			12.4	%		3,865			16,577			20,442			19.1	%		(190	)		-0.9	%
IFP and Other - Internal		6,147			3.8	%		764			11,129			11,893			11.1	%		(5,746	)		-48.3	%
IFP and Other - External		3,238			2.0	%		953			10,832			11,785			11.0	%		(8,547	)		-72.5	%
Total revenues		163,360			100.0	%		19,790			87,410			107,200			100.0	%		56,160			52.4	%
Segment profit:
Medicare - Internal		49,464			30.3	%		2,500			20,218			22,718			21.2	%		26,746			117.7	%
Medicare - External		720			0.4	%		734			(4,178	)		(3,444	)		-3.2	%		4,164			-120.9	%
IFP and Other - Internal		(245	)		-0.1	%		(2,446	)		1,583			(863	)		-0.8	%		618			-71.6	%
IFP and Other - External		147			0.1	%		495			378			873			0.8	%		(726	)		-83.2	%
Total segment profit		50,086			30.7	%		1,283			18,001			19,284			18.0	%		30,802			159.7	%
Corporate expense		224,368			137.3	%		799			93,353			94,152			87.8	%		130,216			138.3	%
Amortization of intangible assets		23,514			14.4	%		4,703			—			4,703			4.4	%		18,811			400.0	%
Transaction costs		—			—			6,245			1,968			8,213			7.7	%		(8,213	)		-100.0	%
Interest expense		8,636			5.3	%		1,289			31			1,320			1.2	%		7,316			554.2	%
Other (income) expense		2			0.0	%		(10	)		67			57			0.1	%		(55	)		-96.5	%
Loss before income taxes	$	(206,434	)		-126.4	%	$	(11,743	)	$	(77,418	)	$	(89,161	)		-83.2	%	$	(117,273	)		131.5	%

* NM = Not meaningful

The following table sets forth operating segment results for the periods indicated:

	Successor									Predecessor			Non-GAAP Combined
	Nine Months Ended Sep 30, 2020						Period from Sep 13, 2019 through Sep 30, 2019			Period from Jan 1, 2019 through Sep 12, 2019			Nine Months Ended Sep 30, 2019
(in thousands, except percentages)	Dollars			% of Net Revenues			Dollars			Dollars			Dollars			% of Net Revenues			$ Change			% Change
Net revenues:
Medicare - Internal	$	316,211			73.3	%	$	14,208			$  102,196			$  116,404			46.4	%		$199,807			171.6	%
Medicare - External		77,305			17.9	%		3,865			55,981			59,846			23.9	%		17,459			29.2	%
IFP and Other - Internal		21,798			5.1	%		764			37,909			38,673			15.4	%		(16,875	)		-43.6	%
IFP and Other - External		16,113			3.7	%		953			34,924			35,877			14.3	%		(19,764	)		-55.1	%
Total revenues		431,427			100.0	%		19,790			231,010			250,800			100.0	%		180,627			72.0	%
Segment profit:
Medicare - Internal		123,946			28.7	%		2,500			40,024			42,524			17.0	%		81,422			191.5	%
Medicare - External		892			0.2	%		734			4,893			5,627			2.2	%		(4,735	)		-84.1	%
IFP and Other - Internal		181			0.0	%		(2,446	)		2,195			(251	)		-0.1	%		432			-172.1	%
IFP and Other - External		789			0.2	%		495			1,748			2,243			0.9	%		(1,454	)		-64.8	%
Total segment profit		125,808			29.2	%		1,283			48,860			50,143			20.0	%		75,665			150.9	%
Corporate expense		241,942			56.1	%		799			103,469			104,268			41.6	%		137,674			132.0	%
Change in fair value of contingent consideration liability		19,700			4.6	%		—			—			—			—			19,700			NM
Amortization of intangible assets		70,543			16.4	%		4,703			—			4,703			1.9	%		65,840			1,400.0	%
Transaction costs		—			—			6,245			2,267			8,512			3.4	%		(8,512	)		-100.0	%
Interest expense		24,378			5.7	%		1,289			140			1,429			0.6	%		22,949			1,605.9	%
Other (income) expense		(494	)		-0.1	%		(10	)		114			104			0.0	%		(598	)		-575.0	%
Loss before income taxes	$	(230,261	)		-53.4	%	$	(11,743	)	$	(57,129	)	$	(68,873	)		-27.5	%	$	(161,388	)		234.3	%

* NM = Not meaningful

The following table presents the number of Submitted Policies by product for the Medicare segments for the three and nine months ended September 30, 2020 and 2019, split between those submissions that are commissionable (compensated through commissions received from carriers) and those that are non-commissionable (compensated via hourly fees and enrollment fees):

	Successor				Predecessor		Combined		Successor				Predecessor		Combined
	Three Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from July 1, 2019 through Sep 12, 2019		Three Months Ended Sep 30, 2019		Nine Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from Jan 1, 2019 through Sep 12, 2019		Nine Months Ended Sep 30, 2019
Medicare Advantage		97,675		13,608		51,078		64,686		314,088		13,608		134,173		147,781
Medicare Supplement		1,245		763		3,091		3,854		6,164		763		11,205		11,968
Prescription Drug Plans		2,006		452		2,217		2,669		6,437		452		7,675		8,127
Total Medicare - Commissionable		100,926		14,823		56,386		71,209		326,689		14,823		153,053		167,876
Medicare Advantage		6,472		1,005		2,338		3,343		20,806		1,005		4,240		5,245
Medicare Supplement		1,716		234		635		869		5,262		234		1,051		1,285
Prescription Drug Plans		1,034		155		335		490		2,787		155		471		626
Total Medicare - Non Commissionable		9,222		1,394		3,308		4,702		28,855		1,394		5,762		7,156
Total Medicare Submitted Policies		110,148		16,217		59,694		75,911		355,544		16,217		158,815		175,032

The following tables present the number of Approved Submissions by product relating to commissionable policies for the Medicare segments for the three and nine months ended September 30, 2020 and 2019. Only commissionable policies are used to calculate our LTV.

Medicare—Internal

	Successor				Predecessor		Combined		Successor				Predecessor		Combined
	Three Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from July 1, 2019 through Sep 12, 2019		Three Months Ended Sep 30, 2019		Nine Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from Jan 1, 2019 through Sep 12, 2019		Nine Months Ended Sep 30, 2019
Medicare Advantage		77,186		8,940		36,270		45,210		228,612		8,940		86,544		95,484
Medicare Supplement		315		199		944		1,143		1,602		199		3,198		3,397
Prescription Drug Plans		1,574		313		1,611		1,924		5,319		313		5,078		5,391
Total Medicare - Internal Commissionble Approved Submissions		79,075		9,452		38,825		48,277		235,533		9,452		94,820		104,272

Medicare—External

	Successor				Predecessor		Combined		Successor				Predecessor		Combined
	Three Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from July 1, 2019 through Sep 12, 2019		Three Months Ended Sep 30, 2019		Nine Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from Jan 1, 2019 through Sep 12, 2019		Nine Months Ended Sep 30, 2019
Medicare Advantage		19,390		3,441		15,551		18,992		80,656		3,441		48,341		51,782
Medicare Supplement		844		466		1,852		2,318		4,035		466		7,065		7,531
Prescription Drug Plans		352		139		606		745		1,206		139		2,597		2,736
Total Medicare - External Commissionble Approved Submissions		20,586		4,046		18,009		22,055		85,897		4,046		58,003		62,049

The following table presents the LTV per Approved Submission by product for the Medicare segments for the three and nine months ended September 30, 2020 and 2019:

	Successor				Predecessor		Combined Non-GAAP		Successor				Predecessor		Combined Non-GAAP
	Three Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from July 1, 2019 through Sep 12, 2019		Three Months Ended Sep 30, 2019		Nine Months Ended Sep 30, 2020		Period from Sep 13, 2019 through Sep 30, 2019		Period from Jan 1, 2019 through Sep 12, 2019		Nine Months Ended Sep 30, 2019
Medicare Advantage	$	987	$	1,013	$	922	$	939	$	913	$	1,013	$	888	$	899
Medicare Supplement	$	934	$	951	$	846	$	867	$	929	$	951	$	911	$	914
Prescription Drug Plans	$	215	$	200	$	198	$	198	$	216	$	200	$	194	$	194