CHICAGO, Oct. 28, 2019 /PRNewswire/ -- Grubhub
Inc. (NYSE: GRUB), the nation's leading online and mobile
food-ordering and delivery marketplace, today announced financial
results for the third quarter ended September 30, 2019 and also posted a letter to
shareholders on its investor relations website. The Company
reported revenues of $322 million,
which is a 30% year-over-year increase from $247 million in the third quarter of 2018. Gross
Food Sales grew 15% year-over-year to $1.4
billion, up from $1.2 billion
in the same period last year.
"Our teams had another strong quarter of execution, adding
nearly one million active diners and 15,000 restaurants to our
platform," said Matt Maloney,
Grubhub founder and CEO. "As we detail in our shareholder letter,
we are entering the next phase of growth in the U.S. online food
ordering industry where it is increasingly important to create a
differentiated experience for diners and long-term value for
restaurants. We are excited to leverage the robust profitability of
our core business and best-in-class restaurant-facing products to
grow our two-sided marketplace in a sustainable manner."
Third Quarter 2019 Highlights
The following results
reflect the financial performance and key operating metrics of our
business for the three months ended September 30, 2019, as compared to the same
period in 2018.
Third Quarter Financial Highlights
- Revenues: $322.1 million, a 30%
year-over-year increase from $247.2
million in the third quarter of 2018.
- Net Income: $1.0 million, or
$0.01 per diluted share, a decrease
from $22.7 million, or $0.24 per diluted share, in the third quarter of
2018.
- Non-GAAP Adjusted EBITDA: $53.8
million, a 10% year-over-year decrease from $60.1 million in the third quarter of 2018.
- Non-GAAP Net Income: $24.7
million, or $0.27 per diluted
share, a decrease from $42.2 million,
or $0.45 per diluted share, in the
third quarter of 2018.
Third Quarter Key Business Metrics
Highlights1
- Active Diners: 21.2 million, a 29% year-over-year increase from
16.4 million Active Diners in the third quarter of 2018.
- Daily Average Grubs (DAGs): 457,300, a 10% year-over-year
increase from 416,000 DAGs in the third quarter of 2018.
- Gross Food Sales: $1.4 billion, a
15% year-over-year increase from $1.2
billion in the third quarter of 2018.
_____________________
|
1 Key
Business Metrics are defined on page 29 of our Annual Report on
Form 10-K filed on February 28, 2019.
|
"Last year, in the fourth quarter, we made opportunistic
investments to expand delivery market coverage, increase new diner
advertising and accelerate our enterprise brand sales efforts.
Through the third quarter of 2019, we believe all three of these
initiatives had a positive impact on our business and long-term
shareholder value," said Adam
DeWitt, Grubhub President and CFO. "Importantly, we
demonstrated the ability to generate operating leverage
consistently throughout 2019 with EBITDA per order increasing 31%
from $0.98 in the fourth quarter of
2018 to $1.28 in the third quarter of
2019. We are excited to embark on the initiatives detailed in
the shareholder letter to further differentiate our marketplace for
both restaurants and diners and position us for maintaining, and
eventually improving, profitability."
Fourth Quarter 2019 Guidance
Based on information
available as of October 28, 2019, the
Company is providing the following financial guidance for the
fourth quarter of 2019.
|
|
Fourth Quarter
2019
|
|
|
|
(in
millions)
|
|
Expected Revenue
range
|
|
$315 -
$335
|
|
Expected Adjusted
EBITDA range
|
|
$15 - $25
|
|
Third Quarter 2019 Financial Results Conference
Call
Grubhub will webcast a conference call tomorrow at
8:00 a.m. CT to discuss the third
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 letter to
shareholders, 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 140,000 restaurant partners in over 2,700 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 including, but not limited to,
achievement of the benefits of our planned additional
investments, 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 September 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.
GRUBHUB
INC.
|
STATEMENTS OF
OPERATIONS
|
(in thousands,
except per share data)
|
|
|
Three Months
Ended September
30,
|
|
|
Nine Months
Ended
September 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Revenues
|
$
|
322,053
|
|
|
$
|
247,225
|
|
|
$
|
970,881
|
|
|
$
|
719,536
|
|
Costs and
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operations and
support
|
|
161,387
|
|
|
|
111,511
|
|
|
|
485,143
|
|
|
|
310,239
|
|
Sales and
marketing
|
|
71,617
|
|
|
|
49,426
|
|
|
|
224,199
|
|
|
|
144,413
|
|
Technology (exclusive
of amortization)
|
|
29,483
|
|
|
|
21,258
|
|
|
|
86,133
|
|
|
|
57,306
|
|
General and
administrative
|
|
25,329
|
|
|
|
22,195
|
|
|
|
73,900
|
|
|
|
58,072
|
|
Depreciation and
amortization
|
|
30,649
|
|
|
|
20,987
|
|
|
|
82,961
|
|
|
|
61,787
|
|
Total costs and
expenses
|
|
318,465
|
|
|
|
225,377
|
|
|
|
952,336
|
|
|
|
631,817
|
|
Income from
operations
|
|
3,588
|
|
|
|
21,848
|
|
|
|
18,545
|
|
|
|
87,719
|
|
Interest expense -
net
|
|
6,025
|
|
|
|
337
|
|
|
|
14,304
|
|
|
|
1,367
|
|
Income (loss) before
provision for income taxes
|
|
(2,437)
|
|
|
|
21,511
|
|
|
|
4,241
|
|
|
|
86,352
|
|
Income tax (benefit)
expense
|
|
(3,447)
|
|
|
|
(1,234)
|
|
|
|
(4,911)
|
|
|
|
2,721
|
|
Net income
attributable to common stockholders
|
$
|
1,010
|
|
|
$
|
22,745
|
|
|
$
|
9,152
|
|
|
$
|
83,631
|
|
Net income per share
attributable to common stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.01
|
|
|
$
|
0.25
|
|
|
$
|
0.10
|
|
|
$
|
0.94
|
|
Diluted
|
$
|
0.01
|
|
|
$
|
0.24
|
|
|
$
|
0.10
|
|
|
$
|
0.91
|
|
Weighted-average
shares used to compute net income per share attributable to common
stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
91,349
|
|
|
|
90,494
|
|
|
|
91,159
|
|
|
|
89,027
|
|
Diluted
|
|
92,847
|
|
|
|
93,678
|
|
|
|
92,850
|
|
|
|
92,091
|
|
KEY BUSINESS
METRICS
|
|
|
Three Months
Ended
September 30,
|
|
|
Nine Months
Ended
September 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Active Diners
(000s)
|
|
21,197
|
|
|
|
16,379
|
|
|
|
21,197
|
|
|
|
16,379
|
|
Daily Average
Grubs
|
|
457,300
|
|
|
|
416,000
|
|
|
|
488,800
|
|
|
|
425,300
|
|
Gross Food Sales
(millions)
|
$
|
1,400
|
|
|
$
|
1,215
|
|
|
$
|
4,362
|
|
|
$
|
3,680
|
|
GRUBHUB
INC.
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(in thousands,
except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
2019
|
|
|
December 31, 2018
|
|
ASSETS
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
394,000
|
|
|
$
|
211,245
|
|
Short-term
investments
|
|
32,214
|
|
|
|
14,084
|
|
Accounts receivable,
less allowances for doubtful accounts
|
|
123,309
|
|
|
|
110,855
|
|
Income tax
receivable
|
|
2,227
|
|
|
|
9,949
|
|
Prepaid expenses and
other current assets
|
|
18,632
|
|
|
|
17,642
|
|
Total current
assets
|
|
570,382
|
|
|
|
363,775
|
|
PROPERTY AND
EQUIPMENT:
|
|
|
|
|
|
|
|
Property and
equipment, net of depreciation and amortization
|
|
160,368
|
|
|
|
119,495
|
|
OTHER
ASSETS:
|
|
|
|
|
|
|
|
Other
assets
|
|
25,452
|
|
|
|
14,186
|
|
Operating lease
right-of-use asset
|
|
100,736
|
|
|
|
—
|
|
Goodwill
|
|
1,007,968
|
|
|
|
1,019,239
|
|
Acquired intangible
assets, net of amortization
|
|
513,848
|
|
|
|
549,013
|
|
Total other
assets
|
|
1,648,004
|
|
|
|
1,582,438
|
|
TOTAL
ASSETS
|
$
|
2,378,754
|
|
|
$
|
2,065,708
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
|
|
|
Restaurant food
liability
|
$
|
130,544
|
|
|
$
|
127,344
|
|
Accounts
payable
|
|
23,392
|
|
|
|
26,656
|
|
Accrued
payroll
|
|
22,537
|
|
|
|
18,173
|
|
Current portion of
long-term debt
|
|
—
|
|
|
|
6,250
|
|
Current operating
lease liability
|
|
8,056
|
|
|
|
—
|
|
Other
accruals
|
|
59,686
|
|
|
|
44,745
|
|
Total current
liabilities
|
|
244,215
|
|
|
|
223,168
|
|
LONG-TERM
LIABILITIES:
|
|
|
|
|
|
|
|
Deferred taxes,
non-current
|
|
28,681
|
|
|
|
46,383
|
|
Noncurrent operating
lease liability
|
|
111,554
|
|
|
|
—
|
|
Long-term
debt
|
|
492,776
|
|
|
|
335,548
|
|
Other
accruals
|
|
817
|
|
|
|
18,270
|
|
Total long-term
liabilities
|
|
633,828
|
|
|
|
400,201
|
|
STOCKHOLDERS' EQUITY:
|
|
|
|
|
|
|
|
Common stock, $0.0001
par value
|
|
9
|
|
|
|
9
|
|
Accumulated other
comprehensive loss
|
|
(2,346)
|
|
|
|
(1,891)
|
|
Additional paid-in
capital
|
|
1,144,541
|
|
|
|
1,094,866
|
|
Retained
earnings
|
|
358,507
|
|
|
|
349,355
|
|
Total
Stockholders' Equity
|
$
|
1,500,711
|
|
|
$
|
1,442,339
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$
|
2,378,754
|
|
|
$
|
2,065,708
|
|
GRUBHUB
INC.
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
September 30,
|
|
|
|
2019
|
|
|
2018
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
9,152
|
|
|
$
|
83,631
|
|
Adjustments to
reconcile net income to net cash from operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
21,665
|
|
|
|
16,189
|
|
Amortization of
intangible assets and developed software
|
|
|
61,296
|
|
|
|
45,598
|
|
Stock-based
compensation
|
|
|
54,806
|
|
|
|
36,445
|
|
Deferred
taxes
|
|
|
(6,208)
|
|
|
|
2,048
|
|
Other
|
|
|
5,210
|
|
|
|
4,572
|
|
Change in assets and
liabilities, net of the effects of business
acquisitions:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(13,335)
|
|
|
|
(17,969)
|
|
Income taxes
receivable
|
|
|
7,722
|
|
|
|
(5,533)
|
|
Prepaid expenses and
other assets
|
|
|
(11,955)
|
|
|
|
(15,455)
|
|
Restaurant food
liability
|
|
|
3,247
|
|
|
|
1,608
|
|
Accounts
payable
|
|
|
(50)
|
|
|
|
5,265
|
|
Accrued
payroll
|
|
|
4,366
|
|
|
|
5,311
|
|
Other
accruals
|
|
|
20,088
|
|
|
|
3,752
|
|
Net cash provided by
operating activities
|
|
|
156,004
|
|
|
|
165,462
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
Purchases of
investments
|
|
|
(49,506)
|
|
|
|
(47,642)
|
|
Proceeds from maturity
of investments
|
|
|
31,736
|
|
|
|
54,916
|
|
Capitalized website
and development costs
|
|
|
(35,068)
|
|
|
|
(21,471)
|
|
Purchases of property
and equipment
|
|
|
(42,702)
|
|
|
|
(31,984)
|
|
Acquisition of other
intangible assets
|
|
|
(8,889)
|
|
|
|
—
|
|
Acquisitions of
businesses, net of cash acquired
|
|
|
127
|
|
|
|
(366,856)
|
|
Other cash flows from
investing activities
|
|
|
(250)
|
|
|
|
38
|
|
Net cash used in
investing activities
|
|
|
(104,552)
|
|
|
|
(412,999)
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
Proceeds from the
issuance of long-term debt
|
|
|
500,000
|
|
|
|
175,000
|
|
Repayments of
borrowings under the credit facility
|
|
|
(342,313)
|
|
|
|
(52,344)
|
|
Proceeds from the
issuance of common stock
|
|
|
—
|
|
|
|
200,000
|
|
Taxes paid related to
net settlement of stock-based compensation awards
|
|
|
(20,503)
|
|
|
|
(28,238)
|
|
Proceeds from exercise
of stock options
|
|
|
4,040
|
|
|
|
13,010
|
|
Payments for debt
issuance costs
|
|
|
(9,136)
|
|
|
|
—
|
|
Net cash provided by
financing activities
|
|
|
132,088
|
|
|
|
307,428
|
|
Net change in cash,
cash equivalents, and restricted cash
|
|
|
183,540
|
|
|
|
59,891
|
|
Effect of exchange
rates on cash, cash equivalents and restricted cash
|
|
|
(293)
|
|
|
|
(406)
|
|
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
|
|
$
|
399,049
|
|
|
$
|
297,724
|
|
SUPPLEMENTAL
DISCLOSURE OF NON-CASH ITEMS
|
|
|
|
|
|
|
|
|
Cash paid for income
taxes
|
|
$
|
567
|
|
|
$
|
7,508
|
|
GRUBHUB
INC.
|
NON-GAAP FINANCIAL
MEASURES RECONCILIATION
|
(in thousands,
except per share and per order data)
|
|
|
Three Months
Ended
September 30,
|
|
|
Nine Months
Ended
September 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Net income
|
$
|
1,010
|
|
|
$
|
22,745
|
|
|
$
|
9,152
|
|
|
$
|
83,631
|
|
Income
taxes
|
|
(3,447)
|
|
|
|
(1,234)
|
|
|
|
(4,911)
|
|
|
|
2,721
|
|
Interest expense -
net
|
|
6,025
|
|
|
|
337
|
|
|
|
14,304
|
|
|
|
1,367
|
|
Depreciation and
amortization
|
|
30,649
|
|
|
|
20,987
|
|
|
|
82,961
|
|
|
|
61,787
|
|
EBITDA
|
|
34,237
|
|
|
|
42,835
|
|
|
|
101,506
|
|
|
|
149,506
|
|
Acquisition,
restructuring and legal costs
|
|
1,312
|
|
|
|
3,024
|
|
|
|
3,139
|
|
|
|
5,665
|
|
Stock-based
compensation
|
|
18,279
|
|
|
|
14,275
|
|
|
|
54,806
|
|
|
|
36,445
|
|
Adjusted
EBITDA
|
$
|
53,828
|
|
|
$
|
60,134
|
|
|
$
|
159,451
|
|
|
$
|
191,616
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
order
|
$
|
0.02
|
|
|
$
|
0.59
|
|
|
$
|
0.07
|
|
|
$
|
0.72
|
|
Adjusted EBITDA per
order
|
$
|
1.28
|
|
|
$
|
1.57
|
|
|
$
|
1.19
|
|
|
$
|
1.65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
|
Nine Months
Ended
September 30,
|
|
|
2019
|
|
|
2018
|
|
|
2019
|
|
|
2018
|
|
Net income
|
$
|
1,010
|
|
|
$
|
22,745
|
|
|
$
|
9,152
|
|
|
$
|
83,631
|
|
Stock-based
compensation
|
|
18,279
|
|
|
|
14,275
|
|
|
|
54,806
|
|
|
|
36,445
|
|
Amortization of
acquired intangible assets
|
|
13,575
|
|
|
|
10,037
|
|
|
|
37,345
|
|
|
|
31,107
|
|
Acquisition,
restructuring and legal costs
|
|
1,312
|
|
|
|
3,024
|
|
|
|
3,139
|
|
|
|
5,665
|
|
Income tax
adjustments
|
|
(9,510)
|
|
|
|
(7,854)
|
|
|
|
(26,967)
|
|
|
|
(21,160)
|
|
Non-GAAP net
income
|
$
|
24,666
|
|
|
$
|
42,227
|
|
|
$
|
77,475
|
|
|
$
|
135,688
|
|
Weighted-average
diluted shares used to compute net income per share attributable to
common stockholders
|
|
92,847
|
|
|
|
93,678
|
|
|
|
92,850
|
|
|
|
92,091
|
|
Non-GAAP net income
per diluted share attributable to common stockholders
|
$
|
0.27
|
|
|
$
|
0.45
|
|
|
$
|
0.83
|
|
|
$
|
1.47
|
|
|
Guidance
|
|
|
Three Months
Ended December 31,
2019
|
|
|
Low
|
|
|
High
|
|
|
(in
millions)
|
|
Net loss
|
$
|
(44.8)
|
|
|
$
|
(33.9)
|
|
Income
taxes
|
|
3.8
|
|
|
|
2.9
|
|
Interest expense -
net
|
|
6.0
|
|
|
|
6.0
|
|
Depreciation and
amortization
|
|
31.0
|
|
|
|
31.0
|
|
EBITDA
|
|
(4.0)
|
|
|
|
6.0
|
|
Acquisition,
restructuring and legal costs
|
|
—
|
|
|
|
—
|
|
Stock-based
compensation
|
|
19.0
|
|
|
|
19.0
|
|
Adjusted
EBITDA
|
$
|
15.0
|
|
|
$
|
25.0
|
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/grubhub-reports-third-quarter-2019-results-300946534.html
SOURCE Grubhub Inc.