Benefitfocus, Inc.

Greetings and welcome to the BenefitFocus first quarter 2021 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Patty Leahy. Thank you, Patty. You may begin.

Thank you, Operator. Good afternoon and welcome to BenefitFocus's first quarter 2021 earnings call. Joining me today are Steve Schwad, President and Chief Executive Officer, and Alpana Wegner, Chief Financial Officer. Steve and Alpana will offer some prepared remarks, and then we'll open up the call for questions. Before we begin, let me remind you that today's discussion will include forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those statements, including impacts of COVID-19, reliance on key personnel, and development of our market and business. For more information, please refer to risk factors discussed in our most recent form 10-K filed with the SEC. During today's call, we will also refer to certain non-GAAP financial measures. You can find important disclosures about those measures in today's earnings press release. With that, I'll now turn the call over to Steve.

Thank you, Patty. I'm looking forward to sharing the great start we had to the year, but before we do that, I'd like to begin with the leadership announcement we released this morning. On behalf of the entire board, I could not be more excited to share that Matt Levin will be joining Benefitfocus as the company's president and chief executive officer, effective next week. Let me share why the board and I believe Matt is the right person to lead the company going forward and why we believe now is the right time to make this change. Matt brings over two decades of deep industry experience centered on driving growth and value creation in the Ben Admin, health insurance, and healthcare technology industries. He also has well-established executive relationships across our industry with employers, health plans, consultants, and brokers. Most importantly, he shares my conviction and the conviction of our board that there is tremendous opportunity to unlock and create value at BenefitFocus. Matt comes to us from ADP, where he most recently led strategic planning, corporate development, and their venture portfolio. Prior to ADP, Matt was head of global strategy at Aon, where he largely focused on its healthcare businesses. One of his largest contributions there was growing its benefits administration business through the launch of Ann's Healthcare Exchanges, which remain amongst the largest and most successful in the country. Before that, Matt was part of the turnaround of Hewitt Associates, where he helped recenter the business around benefits administration and adjacent capabilities. He was also part of the core team that led the merger between Hewitt and Aon. The common thread woven throughout Matt's experience is customer centricity and his ability to identify strategies, partnerships, and adjacencies to drive innovation and fuel revenue growth. Now let's shift to why we believe it's the right time to make this change. As I've previously shared with you, a key area of focus for me has been to attract more top talent to this company. We came across Matt as part of our broader search to continue to strengthen the leadership team. We knew he was capable of filling a variety of roles, and after getting to know him, it became clear that he was ideally suited to lead the company in its next phase of growth. A few years ago, I stepped off the board to serve as CFO and now CEO, and we've made real progress. It's a good time for me to return to the board and hand the reins to Matt, since we are executing well on our plans to return the company to growth. To that end, I'm pleased to report that we've re-established our SAS enrollment business as the most important priority. We've reengaged our associates and reoriented the company to put the customer at the center of everything we do. Our focus on operational excellence is improving customer service and guiding our near-term product roadmap. We have moved the company from consuming cash to generating cash. And we've attracted some very strong talent to drive necessary changes in the business. We continue to prioritize building the absolute best team in the industry, and Matt will accelerate this. Last quarter, I told you we believe successful execution around our core initiatives could increase bookings, improve customer retention, and continue to drive operating leverage in the business. We made good progress in each of these areas during the quarter, specifically We exceeded the high end of Q1 guidance for all metrics. Both SAP and employer channels had a strong quarter. Q1 revenue retention improved year over year, and we improved EBITDA margins and grew free cash flow. Additionally, we are pacing well against our subscription booking targets, and we remain focused on driving to the rule of 40. With this foundation in place, the board and I believe this is the right time and Matt is the right person to help take this company to the next level. In speaking with Matt, I know he's eager to get started. And importantly, he shares my belief that our top priority is to grow our SAS enrollment platform and to serve our customers with excellence. He also shares my belief that when we take good care of our customers, other avenues for growth will open up. This is where we believe Matt's deep industry expertise and his track record for growing through adjacencies and creating valuable partnerships will be so valuable to benefit focus going forward. I will remain on the board for the remainder of my term, and I will stay on as an advisor to Matt to ensure a smooth transition. I'd also like to acknowledge other actions this quarter to continue diversifying our board and strengthening its independence with the addition of Karitha Rushing, former CHRO for Coca-Cola and Equifax. While only working with her for a few months, it's clear to me that her experience and skills bring tremendous value to our board and our company. Finally, before handing off to Alpana, I want to thank the team at BenefitFocus. Our associates have demonstrated incredible resilience and dedication while also raising the bar to better serve our customers. Most importantly, they've supported one another and grown stronger as a team through what has no doubt been one of the most challenging times in recent memory. I appreciate each and every one of them and know we would not be where we are today without them. With that, I'll turn it over to Alpana to discuss our Q1 results and more Tito. Alpana?