CHICAGO, July 30, 2019 /PRNewswire/ -- Grubhub
Inc. (NYSE: GRUB), the nation's leading online and mobile
food-ordering and delivery marketplace, today announced financial
results for the second quarter ended June
30, 2019. The Company posted revenues of $325 million, which is a 36% year-over-year
increase from $240 million in the
second quarter of 2018. Gross Food Sales grew 20% year-over-year to
$1.5 billion, up from $1.2 billion in the same period last year.
"The team continued executing in the second quarter, adding
thousands of new, high-quality independent and enterprise
restaurants and growing our active diner base to more than 20
million," said Matt Maloney, Grubhub
founder and CEO. "We are excited about the trajectory of our
two-sided marketplace – both in terms of geographic diversity and
depth in individual markets. Restaurants are increasingly valuing
the incremental sales and products we provide, while diners highly
regard our robust restaurant selection and consistently low
transaction fees."
Second Quarter 2019 Highlights
The following results reflect the financial performance and key
operating metrics of our business for the three months ended
June 30, 2019, as compared to the
same period in 2018.
Second Quarter Financial Highlights
- Revenues: $325.1 million, a 36%
year-over-year increase from $239.7
million in the second quarter of 2018.
- Net Income: $1.3 million, or
$0.01 per diluted share, a 96%
year-over-year decrease from $30.1
million, or $0.33 per diluted
share, in the second quarter of 2018.
- Non-GAAP Adjusted EBITDA: $54.7
million, a 19% year-over-year decrease from $67.4 million in the second quarter of 2018.
- Non-GAAP Net Income: $24.9
million, or $0.27 per diluted
share, a 46% year-over-year decrease from $46.3 million, or $0.50 per diluted share, in the second quarter of
2018.
Second Quarter Key Business Metrics
Highlights1
- Active Diners: 20.3 million, a 30% year-over-year increase from
15.6 million Active Diners in the second quarter of 2018.
- Daily Average Grubs (DAGs): 488,900, a 16% year-over-year
increase from 423,200 DAGs in the second quarter of 2018.
- Gross Food Sales: $1.5 billion, a
20% year-over-year increase from $1.2
billion in the second quarter of 2018.
"Our Adjusted EBITDA per order increased by $0.14 from the first quarter to $1.23 despite the headwind of the seasonally
slower second quarter. This sequential improvement was primarily
driven by increasing delivery efficiency, especially in our quickly
ramping recently launched markets," said Adam DeWitt, Grubhub president and CFO. "We have
achieved this profitability improvement while extending our
delivery business into smaller and less dense markets, setting us
up for continued unit economic improvement as we head into our
seasonally stronger months at the end of the year."
Third Quarter and Full Year 2019 Guidance
Based on information available as of July
30, 2019, the Company is providing the following financial
guidance for the third quarter and full year of 2019.
|
|
Third Quarter
2019
|
|
Full Year
2019
|
|
|
(in
millions)
|
|
Expected Revenue
range
|
|
$320 -
$340
|
|
$1,340 -
$1,390
|
|
Expected Adjusted
EBITDA range
|
|
$53 - $60
|
|
$235 -
$250
|
Second Quarter 2019 Financial Results Conference Call
Grubhub will webcast a conference call today at 9:00 a.m. CT to discuss the second quarter 2019
financial results. The webcast can be accessed on the Grubhub
Investor Relations website at https://investors.grubhub.com, along
with the Company's earnings press release and financial tables. A
replay of the webcast will be available at the same website.
About Grubhub
Grubhub (NYSE: GRUB) is the nation's leading online and mobile
food-ordering and delivery marketplace with the largest and most
comprehensive network of restaurant partners, as well as the
largest diner base. Dedicated to connecting diners with the food
they love from their favorite local restaurants, Grubhub strives to
elevate food ordering through innovative restaurant technology,
easy-to-use platforms and an improved delivery experience. Grubhub
is proud to work with more than 125,000 restaurant partners in over
2,400 U.S. cities and London. The
Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp,
Tapingo, AllMenus and MenuPages.
Use of Forward Looking Statements
This press release contains forward-looking statements regarding
Grubhub, "the Company's" or our management's future expectations,
beliefs, intentions, goals, strategies, plans and prospects,
including the expected benefits to, and financial performance of,
Grubhub including its acquisitions. Such statements
constitute "forward-looking statements", which are
subject to the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements involve substantial known and unknown risks,
uncertainties and assumptions that could cause actual results,
performance or achievements to differ materially from any future
results, performance or achievements expressed or implied by the
forward-looking statements. Such risks and uncertainties include,
but are not limited to, the matters set forth in the filings that
we make with the Securities and Exchange Commission from time to
time, including those set forth in the section entitled "Risk
Factors" in our Annual Report on Form 10-K filed on
February 28, 2019, which is on file
with the SEC and is available on the Investor Relations section of
our website at https://investors.grubhub.com. Additional
information will be set forth in our Quarterly Report on Form 10-Q
that will be filed for the quarter ended June 30, 2019, which should be read in
conjunction with these financial results. Please also note that
forward-looking statements represent management's beliefs and
assumptions only as of the date of this press release. Except as
required by law, we disclaim any intention to, and undertake no
obligation to, publicly update these forward-looking statements, or
to update the reasons actual results could differ materially from
those anticipated in the forward-looking statements, even if new
information becomes available in the future.
Use of Non-GAAP Financial Measures
Adjusted EBITDA, non-GAAP net income and non-GAAP net income per
diluted share attributable to common stockholders are financial
measures that are not calculated in accordance with accounting
principles generally accepted in the
United States, or GAAP.
We define Adjusted EBITDA as net income adjusted to exclude
acquisition, restructuring and certain legal costs, income taxes,
net interest expense, depreciation and amortization and stock-based
compensation expense. Non-GAAP net income and non-GAAP net income
per diluted share attributable to common stockholders exclude
acquisition, restructuring and certain legal costs, amortization of
acquired intangible assets, stock-based compensation expense and
other nonrecurring items as well as the income tax effects of these
non-GAAP adjustments. We use these non-GAAP financial measures as
key performance measures because we believe they facilitate
operating performance comparisons from period to period by
excluding potential differences primarily caused by variations in
capital structures, tax positions, the impact of acquisitions,
restructuring and certain legal costs, the impact of depreciation
and amortization expense on our fixed assets and the impact of
stock-based compensation expense. Adjusted EBITDA, non-GAAP net
income and non-GAAP net income per diluted share attributable to
common stockholders are not measurements of our financial
performance under GAAP and should not be considered as an
alternative to performance measures derived in accordance with
GAAP.
See "Non-GAAP Financial Measures Reconciliation" below
for a reconciliation of net income to Adjusted EBITDA, non-GAAP net
income and non-GAAP net income per diluted share attributable to
common stockholders.
_____________________________
1 Key Business Metrics are defined on page 29 of our Annual
Report on Form 10-K filed on February
28, 2019.
|
GRUBHUB
INC.
STATEMENTS OF
OPERATIONS
(in thousands,
except per share data)
|
|
|
Three Months
Ended
June
30,
|
|
|
Six Months
Ended
June 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
Revenues
|
$
|
325,058
|
|
|
$
|
239,741
|
|
|
$
|
648,828
|
|
|
$
|
472,311
|
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations and
support
|
|
162,406
|
|
|
|
102,445
|
|
|
|
323,756
|
|
|
|
198,728
|
|
|
Sales and
marketing
|
|
74,128
|
|
|
|
46,231
|
|
|
|
152,582
|
|
|
|
94,987
|
|
|
Technology (exclusive
of amortization)
|
|
29,400
|
|
|
|
18,717
|
|
|
|
56,650
|
|
|
|
36,048
|
|
|
General and
administrative
|
|
25,784
|
|
|
|
18,180
|
|
|
|
48,571
|
|
|
|
35,877
|
|
|
Depreciation and
amortization
|
|
27,223
|
|
|
|
19,849
|
|
|
|
52,312
|
|
|
|
40,800
|
|
|
Total costs and
expenses
|
|
318,941
|
|
|
|
205,422
|
|
|
|
633,871
|
|
|
|
406,440
|
|
|
Income from
operations
|
|
6,117
|
|
|
|
34,319
|
|
|
|
14,957
|
|
|
|
65,871
|
|
|
Interest expense -
net
|
|
5,467
|
|
|
|
8
|
|
|
|
8,279
|
|
|
|
1,030
|
|
|
Income before
provision for income taxes
|
|
650
|
|
|
|
34,311
|
|
|
|
6,678
|
|
|
|
64,841
|
|
|
Income tax (benefit)
expense
|
|
(602)
|
|
|
|
4,191
|
|
|
|
(1,464)
|
|
|
|
3,955
|
|
|
Net income
attributable to common stockholders
|
$
|
1,252
|
|
|
$
|
30,120
|
|
|
$
|
8,142
|
|
|
$
|
60,886
|
|
|
Net income per share
attributable to common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.01
|
|
|
$
|
0.34
|
|
|
$
|
0.09
|
|
|
$
|
0.69
|
|
|
Diluted
|
$
|
0.01
|
|
|
$
|
0.33
|
|
|
$
|
0.09
|
|
|
$
|
0.67
|
|
|
Weighted-average
shares used to compute net income per share attributable to common
stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
91,177
|
|
|
|
89,503
|
|
|
|
91,064
|
|
|
|
88,294
|
|
|
Diluted
|
|
92,786
|
|
|
|
92,503
|
|
|
|
92,852
|
|
|
|
91,297
|
|
|
KEY BUSINESS
METRICS
|
|
|
|
|
Three Months
Ended
June 30,
|
|
|
Six Months
Ended
June 30,
|
|
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
Active Diners
(000s)
|
|
|
|
20,288
|
|
|
|
15,581
|
|
|
|
20,288
|
|
|
|
15,581
|
|
|
Daily Average
Grubs
|
|
|
|
488,900
|
|
|
|
423,200
|
|
|
|
504,900
|
|
|
|
430,000
|
|
|
Gross Food Sales
(millions)
|
|
|
$
|
1,459
|
|
|
$
|
1,220
|
|
|
$
|
2,962
|
|
|
$
|
2,465
|
|
|
GRUBHUB
INC.
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
(in thousands,
except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2019
|
|
|
December 31, 2018
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
358,847
|
|
|
$
|
211,245
|
|
|
Short-term
investments
|
|
18,190
|
|
|
|
14,084
|
|
|
Accounts receivable,
less allowances for doubtful accounts
|
|
123,801
|
|
|
|
110,855
|
|
|
Income tax
receivable
|
|
9,520
|
|
|
|
9,949
|
|
|
Prepaid expenses and
other current assets
|
|
23,752
|
|
|
|
17,642
|
|
|
Total current
assets
|
|
534,110
|
|
|
|
363,775
|
|
|
PROPERTY AND
EQUIPMENT:
|
|
|
|
|
|
|
|
|
Property and
equipment, net of depreciation and amortization
|
|
148,995
|
|
|
|
119,495
|
|
|
OTHER
ASSETS:
|
|
|
|
|
|
|
|
|
Other
assets
|
|
23,166
|
|
|
|
14,186
|
|
|
Operating lease
right-of-use asset
|
|
104,078
|
|
|
|
—
|
|
|
Goodwill
|
|
1,005,477
|
|
|
|
1,019,239
|
|
|
Acquired intangible
assets, net of amortization
|
|
527,423
|
|
|
|
549,013
|
|
|
Total other
assets
|
|
1,660,144
|
|
|
|
1,582,438
|
|
|
TOTAL
ASSETS
|
$
|
2,343,249
|
|
|
$
|
2,065,708
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
|
Restaurant food
liability
|
$
|
124,261
|
|
|
$
|
127,344
|
|
|
Accounts
payable
|
|
21,527
|
|
|
|
26,656
|
|
|
Accrued
payroll
|
|
21,296
|
|
|
|
18,173
|
|
|
Current portion of
long-term debt
|
|
—
|
|
|
|
6,250
|
|
|
Current operating
lease liability
|
|
6,875
|
|
|
|
—
|
|
|
Other
accruals
|
|
46,697
|
|
|
|
44,745
|
|
|
Total current
liabilities
|
|
220,656
|
|
|
|
223,168
|
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
|
|
|
|
Deferred taxes,
non-current
|
|
32,695
|
|
|
|
46,383
|
|
|
Noncurrent operating
lease liability
|
|
114,724
|
|
|
|
—
|
|
|
Long-term
debt
|
|
492,723
|
|
|
|
335,548
|
|
|
Other
accruals
|
|
751
|
|
|
|
18,270
|
|
|
Total long-term
liabilities
|
|
640,893
|
|
|
|
400,201
|
|
|
STOCKHOLDERS' EQUITY:
|
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value
|
|
9
|
|
|
|
9
|
|
|
Accumulated other
comprehensive loss
|
|
(1,980)
|
|
|
|
(1,891)
|
|
|
Additional paid-in
capital
|
|
1,126,174
|
|
|
|
1,094,866
|
|
|
Retained
earnings
|
|
357,497
|
|
|
|
349,355
|
|
|
Total
Stockholders' Equity
|
$
|
1,481,700
|
|
|
$
|
1,442,339
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$
|
2,343,249
|
|
|
$
|
2,065,708
|
|
|
GRUBHUB
INC.
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
2019
|
|
|
2018
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
8,142
|
|
|
$
|
60,886
|
|
|
Adjustments to
reconcile net income to net cash from operating
activities:
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
13,626
|
|
|
|
10,526
|
|
|
Deferred
taxes
|
|
|
298
|
|
|
|
(3,308)
|
|
|
Amortization of
intangible assets and developed software
|
|
|
38,686
|
|
|
|
30,274
|
|
|
Stock-based
compensation
|
|
|
36,527
|
|
|
|
22,170
|
|
|
Other
|
|
|
3,240
|
|
|
|
3,042
|
|
|
Change in assets and
liabilities, net of the effects of business
acquisitions:
|
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(13,349)
|
|
|
|
3,888
|
|
|
Income taxes
receivable
|
|
|
429
|
|
|
|
1,882
|
|
|
Prepaid expenses and
other assets
|
|
|
(14,857)
|
|
|
|
(8,446)
|
|
|
Restaurant food
liability
|
|
|
(3,078)
|
|
|
|
(9,870)
|
|
|
Accounts
payable
|
|
|
(10,216)
|
|
|
|
(107)
|
|
|
Accrued
payroll
|
|
|
3,122
|
|
|
|
(1,961)
|
|
|
Other
accruals
|
|
|
7,219
|
|
|
|
7,041
|
|
|
Net cash provided by
operating activities
|
|
|
69,789
|
|
|
|
116,017
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Purchases of
investments
|
|
|
(25,526)
|
|
|
|
(44,271)
|
|
|
Proceeds from maturity
of investments
|
|
|
21,636
|
|
|
|
29,116
|
|
|
Capitalized website
and development costs
|
|
|
(22,188)
|
|
|
|
(13,145)
|
|
|
Purchases of property
and equipment
|
|
|
(23,140)
|
|
|
|
(19,266)
|
|
|
Acquisition of other
intangible assets
|
|
|
(8,889)
|
|
|
|
—
|
|
|
Acquisitions of
businesses, net of cash acquired
|
|
|
127
|
|
|
|
737
|
|
|
Other cash flows from
investing activities
|
|
|
—
|
|
|
|
24
|
|
|
Net cash used in
investing activities
|
|
|
(57,980)
|
|
|
|
(46,805)
|
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Proceeds from the
issuance of senior notes
|
|
|
500,000
|
|
|
|
—
|
|
|
Repayments of
borrowings under the credit facility
|
|
|
(342,313)
|
|
|
|
(51,562)
|
|
|
Proceeds from the
issuance of common stock
|
|
|
—
|
|
|
|
200,000
|
|
|
Taxes paid related to
net settlement of stock-based compensation awards
|
|
|
(15,360)
|
|
|
|
(18,717)
|
|
|
Proceeds from exercise
of stock options
|
|
|
2,930
|
|
|
|
9,958
|
|
|
Payments for debt
issuance costs
|
|
|
(8,954)
|
|
|
|
—
|
|
|
Net cash provided by
financing activities
|
|
|
136,303
|
|
|
|
139,679
|
|
|
Net change in cash,
cash equivalents, and restricted cash
|
|
|
148,112
|
|
|
|
208,891
|
|
|
Effect of exchange
rates on cash, cash equivalents and restricted cash
|
|
|
(2)
|
|
|
|
(318)
|
|
|
Cash, cash
equivalents, and restricted cash at beginning of year
|
|
|
215,802
|
|
|
|
238,239
|
|
|
Cash, cash
equivalents, and restricted cash at end of the period
|
|
$
|
363,912
|
|
|
$
|
446,812
|
|
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH ITEMS
|
|
|
|
|
|
|
|
|
|
Cash paid for income
taxes
|
|
$
|
567
|
|
|
$
|
7,426
|
|
|
GRUBHUB
INC.
NON-GAAP FINANCIAL
MEASURES RECONCILIATION
(in thousands,
except per share data)
|
|
|
Three Months
Ended
June 30,
|
|
|
Six Months
Ended
June
30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
Net income
|
$
|
1,252
|
|
|
$
|
30,120
|
|
|
$
|
8,142
|
|
|
$
|
60,886
|
|
|
Income
taxes
|
|
(602)
|
|
|
|
4,191
|
|
|
|
(1,464)
|
|
|
|
3,955
|
|
|
Interest expense -
net
|
|
5,467
|
|
1
|
|
8
|
|
|
|
8,279
|
|
1
|
|
1,030
|
|
|
Depreciation and
amortization
|
|
27,223
|
|
|
|
19,849
|
|
|
|
52,312
|
|
|
|
40,800
|
|
|
EBITDA
|
|
33,340
|
|
|
|
54,168
|
|
|
|
67,269
|
|
|
|
106,671
|
|
|
Acquisition,
restructuring and legal costs
|
|
1,341
|
|
|
|
1,312
|
|
|
|
1,827
|
|
|
|
2,641
|
|
|
Stock-based
compensation
|
|
20,049
|
|
2
|
|
11,939
|
|
|
|
36,527
|
|
2
|
|
22,170
|
|
|
Adjusted
EBITDA
|
$
|
54,730
|
|
|
$
|
67,419
|
|
|
$
|
105,623
|
|
|
$
|
131,482
|
|
|
|
|
Three Months
Ended
June 30,
|
|
|
Six Months
Ended
June 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
|
Net income
|
$
|
1,252
|
|
|
$
|
30,120
|
|
|
$
|
8,142
|
|
|
$
|
60,886
|
|
|
Stock-based
compensation
|
|
20,049
|
|
2
|
|
11,939
|
|
|
|
36,527
|
|
2
|
|
22,170
|
|
|
Amortization of
acquired intangible assets
|
|
11,828
|
|
|
|
9,527
|
|
|
|
23,770
|
|
|
|
21,070
|
|
|
Acquisition,
restructuring and legal costs
|
|
1,341
|
|
|
|
1,312
|
|
|
|
1,827
|
|
|
|
2,641
|
|
|
Income tax
adjustments
|
|
(9,595)
|
|
|
|
(6,628)
|
|
|
|
(17,457)
|
|
|
|
(13,305)
|
|
|
Non-GAAP net
income
|
$
|
24,875
|
|
|
$
|
46,270
|
|
|
$
|
52,809
|
|
|
$
|
93,462
|
|
|
Weighted-average
diluted shares used to compute net income per share attributable to
common stockholders
|
|
92,786
|
|
|
|
92,503
|
|
|
|
92,852
|
|
|
|
91,297
|
|
|
Non-GAAP net income
per diluted share attributable to common stockholders
|
$
|
0.27
|
|
|
$
|
0.50
|
|
|
$
|
0.57
|
|
|
$
|
1.02
|
|
|
Guidance
|
|
|
Three Months
Ended
September 30, 2019
|
|
|
Year Ended
December 31, 2019
|
|
|
Low
|
|
|
High
|
|
|
Low
|
|
|
High
|
|
|
(in
millions)
|
|
|
Net income
(loss)
|
$
|
(1.6)
|
|
|
$
|
2.8
|
|
|
$
|
18.8
|
|
|
$
|
28.1
|
|
|
Income
taxes
|
|
(0.9)
|
|
|
|
1.7
|
|
|
|
5.1
|
|
|
|
10.8
|
|
|
Interest expense
̶ net
|
|
6.5
|
|
|
|
6.5
|
|
|
|
21.3
|
|
|
|
21.3
|
|
|
Depreciation and
amortization
|
|
30.0
|
|
|
|
30.0
|
|
|
|
114.0
|
|
|
|
114.0
|
|
|
EBITDA
|
|
34.0
|
|
|
|
41.0
|
|
|
|
159.2
|
|
|
|
174.2
|
|
|
Acquisition and
restructuring costs
|
|
—
|
|
|
|
—
|
|
|
|
1.8
|
|
|
|
1.8
|
|
|
Stock-based
compensation
|
|
19.0
|
|
|
|
19.0
|
|
|
|
74.0
|
|
|
|
74.0
|
|
|
Adjusted
EBITDA
|
$
|
53.0
|
|
|
$
|
60.0
|
|
|
$
|
235.0
|
|
|
$
|
250.0
|
|
_____________________________
1 Interest
expense for the three and six months ended June 30, 2019 included $1.8 million and $1.9
million, respectively, of expense for the write-off of
unamortized debt issuance costs in February and June of 2019.
2 Stock-based compensation for the three and six
months ended June 30, 2019 included
$1.6 million of expense related to
the accelerated vesting of equity awards to a terminated acquired
employee.
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SOURCE Grubhub Inc.