Grubhub Reports First Quarter 2021 Results

CHICAGO, April 28, 2021 /PRNewswire/ -- Grubhub Inc. (NYSE: GRUB), a leading online and mobile food-ordering and delivery marketplace, today announced financial results for the first quarter ended March 31, 2021 and also posted a letter to shareholders on its investor relations website. For the first quarter, the Company reported revenues of $551 million, which is a 52% year-over-year increase from $363 million in the same period last year. Gross Food Sales grew 60% year-over-year to $2.6 billion, up from $1.6 billion in the first quarter of 2020.

"We are proud of our continued role in helping restaurants grow their businesses and supporting the communities where they operate. Our team continued its strong execution in the first quarter – easily hitting records for all of our key business metrics," said Matt Maloney, Grubhub founder and CEO. "With yesterday's public filing of the registration statement and preliminary proxy statement with the SEC and the Grubhub special stockholder meeting expected to take place in June, we are looking forward to closing the transaction in the coming months and beginning our next chapter as part of the Just Eat Takeaway.com family."

First Quarter 2021 Highlights
The following results reflect the financial performance and key operating metrics of our business for the three months ended March 31, 2021, as compared to the same period in 2020.

First Quarter Financial Highlights

Revenues: $550.6 million, a 52% year-over-year increase from $363.0 million in the first quarter of 2020.
Net (Loss): $(75.5) million, or $(0.81) per diluted share, a decrease from $(33.4) million, or $(0.36) per diluted share, in the first quarter of 2020.
Non-GAAP Adjusted EBITDA: $(9.3) million, a decrease from $21.0 million in the first quarter of 2020.
Non-GAAP Net (Loss): $(52.5) million, or $(0.56) per diluted share, a decrease from $(37) thousand, or $(0.00) per diluted share, in the first quarter of 2020.

First Quarter Key Business Metrics Highlights¹

Active Diners: 33.0 million, a 38% year-over-year increase from 23.9 million Active Diners in the first quarter of 2020.
Daily Average Grubs (DAGs): 745,700, a 44% year-over-year increase from 516,300 DAGs in the first quarter of 2020.
Gross Food Sales: $2.6 billion, a 60% year-over-year increase from $1.6 billion in the first quarter of 2020.


¹ Key Business Metrics are defined on page 29 of our Annual Report on Form 10-K filed on March 1, 2021.

"We saw strength across all of our markets during the first quarter, with the highest growth coming in places with a heavy existing competitive presence. We also observed a continued, steady recovery in our largest market, New York City," said Adam DeWitt, Grubhub president and CFO. "Order growth accelerated in the high-single digits compared to the fourth quarter of 2020, even when normalizing for the initial COVID-related deceleration in the second half of March 2020. We believe our robust hybrid marketplace model is well positioned as we transition to a post-COVID environment."

Guidance
Given Grubhub's pending acquisition by Just Eat Takeaway.com, it is no longer issuing forward-looking guidance.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as 33 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 300,000 restaurants and is proud to partner with over 280,000 of these restaurants in over 4,000 U.S. cities. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages.

Forward-Looking Statements
This communication contains "forward-looking statements" regarding Grubhub, Just Eat Takeaway.com or their respective management's future expectations, beliefs, intentions, goals, strategies, plans and prospects, which, in the case of Grubhub, are made in reliance on the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve substantial risks, known and unknown, uncertainties, assumptions and other factors that may cause actual results, performance or achievements to differ materially from future results expressed or implied by such forward-looking statements including, but not limited to, the occurrence of any event, change or other circumstances that could give rise to the right of one or both of Grubhub or Just Eat Takeaway.com to terminate the merger agreement; the ability to obtain approval by Grubhub stockholders on the expected schedule or at all; difficulties and delays in integrating Grubhub's and Just Eat Takeaway.com's businesses; risks that the proposed merger disrupts Grubhub's or Just Eat Takeaway.com's current plans and operations; failing to fully realize anticipated synergies, cost savings and other anticipated benefits of the proposed merger when expected or at all; potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed merger; the risk that unexpected costs will be incurred; the ability of Grubhub or Just Eat Takeaway.com to retain and hire key personnel; the diversion of management's attention from ongoing business operations; uncertainty as to the value of the Just Eat Takeaway.com ordinary shares to be issued in connection with the proposed merger; uncertainty as to the long-term value of the common stock of the combined company following the proposed merger; the continued availability of capital and financing following the proposed merger; the outcome of any legal proceedings that may be instituted against Grubhub, Just Eat Takeaway.com or their respective directors and officers; changes in global, political, economic, business, competitive, market and regulatory forces; changes in tax laws, regulations, rates and policies; future business acquisitions or disposals; competitive developments; and the timing and occurrence (or non-occurrence) of other events or circumstances that may be beyond Grubhub's and Just Eat Takeaway.com's control. These and other risks, uncertainties, assumptions and other factors may be amplified or made more uncertain by the COVID-19 pandemic, which has caused significant economic uncertainty.

The extent to which the COVID-19 pandemic impacts Grubhub's and Just Eat Takeaway.com's businesses, operations and financial results, including the duration and magnitude of such effects, will depend on numerous factors, which are unpredictable, including, but not limited to, the duration and spread of the outbreak, its severity, the actions taken to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. Forward-looking statements generally relate to future events or Grubhub and Just Eat Takeaway.com's future financial or operating performance and include, without limitation, statements relating to the proposed merger and the potential impact of the COVID-19 outbreak on Grubhub and Just Eat Takeaway.com's business and operations. In some cases, you can identify forward-looking statements because they contain words such as "anticipates," "believes," "contemplates," "could," "seeks," "estimates," "intends," "may," "plans," "potential," "predicts," "projects," "should," "will," "would" or similar expressions and the negatives of those terms.

While forward-looking statements are Grubhub's and Just Eat Takeaway.com's current predictions at the time they are made, you should not rely upon them. Forward-looking statements represent Grubhub's and Just Eat Takeaway.com's management's beliefs and assumptions only as of the date of this communication, unless otherwise indicated, and there is no implication that the information contained in this communication is made subsequent to such date. For additional information concerning factors that could cause actual results and outcomes to differ materially from those expressed or implied in the forward-looking statements, please refer to the cautionary statements and risk factors included in Grubhub's filings with the Securities and Exchange Commission (the "SEC"), including Grubhub's Annual Report on Form 10-K filed with the SEC on March 1, 2021, Grubhub's Quarterly Reports on Form 10-Q and any further disclosures Grubhub makes in Current Reports on Form 8-K. Grubhub's SEC filings are available electronically on Grubhub's investor website at investors.grubhub.com or the SEC's website at www.sec.gov. For additional information concerning factors that could cause future results to differ from those expressed or implied in the forward-looking statements, please refer to Just Eat Takeaway.com's non-exhaustive list of key risks and cautionary statements included in Just Eat Takeaway.com's Annual Report, which is available electronically on Just Eat Takeaway.com's investor website at www.justeattakeaway.com. Except as required by law, Grubhub and Just Eat Takeaway.com assume no obligation to update these forward-looking statements or this communication, or to update, supplement or correct the information set forth in this communication or the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. All subsequent written and oral forward-looking statements attributable to Grubhub, Just Eat Takeaway.com or any person acting on behalf of either party are expressly qualified in their entirety by the cautionary statements referenced above.

Additional Information and Where to Find It
In connection with the proposed merger, Just Eat Takeaway.com has filed with the SEC a registration statement on Form F-4 to register the shares to be issued in connection with the proposed merger. The registration statement has not yet become effective and includes a preliminary proxy statement of Grubhub/prospectus of Just Eat Takeaway.com which, when finalized, will be sent to the stockholders of Grubhub seeking their approval of the respective merger-related proposals. Also in connection with the proposed merger, Just Eat Takeaway.com will file with the Netherlands Authority for the Financial Markets ("AFM") and/or the UK Financial Conduct Authority ("FCA") a prospectus for the listing and admission to trading on Euronext Amsterdam and/or the admission to listing on the FCA's Official List and to trading on the London Stock Exchange's Main Market for listed securities of the shares to be issued in connection with the proposed merger (the "Prospectus").

INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT ON FORM F-4 AND THE RELATED PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM F-4, THE PROSPECTUS, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC, THE AFM AND/OR THE FCA IN CONNECTION WITH THE PROPOSED MERGER, WHEN THEY BECOME AVAILABLE, BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT GRUBHUB, JUST EAT TAKEAWAY.COM AND THE PROPOSED MERGER.

Investors and security holders may obtain copies of these documents and any other documents filed with or furnished to the SEC by Grubhub or Just Eat Takeaway.com free of charge through the website maintained by the SEC at www.sec.gov, from Grubhub at its website, investors.grubhub.com, or from Just Eat Takeaway.com at its website www.justeattakeaway.com. The Prospectus, as well as any supplement thereto, will be made available on the website of Just Eat Takeaway.com at its website www.justeattakeaway.com.

Participants in the Solicitation
Grubhub, Just Eat Takeaway.com and their respective directors and certain of their respective executive officers and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed merger under the rules of the SEC. Information about Grubhub's directors and executive officers is available in Grubhub's definitive proxy statement dated April 28, 2021 for its 2021 Annual Meeting of Stockholders. To the extent holdings of Grubhub securities by directors or executive officers of Grubhub have changed since the amounts contained in the definitive proxy statement for Grubhub's 2021 Annual Meeting of Stockholders, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. These documents are available free of charge from the sources indicated above, and from Grubhub by going to its investor relations page on its corporate website at investors.grubhub.com. Information about Just Eat Takeaway.com's directors and executive officers and a description of their interests are set forth in Just Eat Takeaway.com's 2020 Annual Report, which may be obtained free of charge from Just Eat Takeaway.com's website, www.justeattakeaway.com. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed merger when they become available. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Grubhub or Just Eat Takeaway.com using the sources indicated above.

No Offer or Solicitation
This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended and applicable United Kingdom, Dutch and other European regulations.

Use of Non-GAAP Financial Measures
Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) 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 (loss) adjusted to exclude merger, acquisition, restructuring and certain legal costs, income taxes, net interest expense, depreciation and amortization and stock-based compensation expense. Non-GAAP net income (loss) and non-GAAP net income (loss) per diluted share attributable to common stockholders exclude merger, 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 (loss) and non-GAAP net income (loss) 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 (loss) to Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per diluted share attributable to common stockholders.

GRUBHUB INC.
STATEMENTS OF OPERATIONS
(in thousands, except per share data)

	Three Months Ended March 31,
	2021		2020
Revenues	$	550,592	$	362,980
Costs and expenses:
Operations and support		393,486		214,561
Sales and marketing		127,234		90,742
Technology (exclusive of amortization)		31,951		31,273
General and administrative		29,124		38,949
Depreciation and amortization		37,717		33,363
Total costs and expenses		619,512		408,888
Loss from operations		(68,920)		(45,908)
Interest expense, net		7,158		6,380
Loss before provision for income taxes		(76,078)		(52,288)
Income tax benefit		(617)		(18,861)
Net loss attributable to common stockholders	$	(75,461)	$	(33,427)
Net loss per share attributable to common stockholders
Basic	$	(0.81)	$	(0.36)
Diluted	$	(0.81)	$	(0.36)
Weighted-average shares used to compute net loss per share attributable to common stockholders:
Basic		93,215		91,793
Diluted		93,215		91,793

KEY BUSINESS METRICS

	Three Months Ended March 31,
	2021		2020
Active Diners (000s)		32,960		23,892
Daily Average Grubs		745,700		516,300
Gross Food Sales (millions)	$	2,604	$	1,630

GRUBHUB INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)

	March 31, 2021		December 31, 2020
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	348,837	$	360,232
Short-term investments		55,824		53,126
Accounts receivable, less allowances for doubtful accounts		104,727		111,802
Income tax receivable		22,229		22,472
Prepaid expenses and other current assets		20,408		24,765
Total current assets		552,025		572,397
PROPERTY AND EQUIPMENT:
Property and equipment, net of depreciation and amortization		217,677		216,146
OTHER ASSETS:
Other assets		54,373		49,201
Deferred tax assets, non-current		142		142
Operating lease right-of-use asset		85,150		88,227
Goodwill		1,007,968		1,007,968
Acquired intangible assets, net of amortization		445,136		454,838
Total other assets		1,592,769		1,600,376
TOTAL ASSETS	$	2,362,471	$	2,388,919
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Restaurant food liability	$	136,280	$	141,802
Accounts payable		16,877		19,859
Accrued payroll		40,871		27,346
Current operating lease liability		17,598		17,897
Other accruals		180,412		149,278
Total current liabilities		392,038		356,182
LONG-TERM LIABILITIES:
Deferred taxes, non-current		16,823		17,777
Noncurrent operating lease liability		100,251		103,416
Long-term debt		494,330		494,103
Other accruals		6		644
Total long-term liabilities		611,410		615,940
STOCKHOLDERS' EQUITY:
Common stock, $0.0001 par value		9		9
Accumulated other comprehensive loss		(1,167)		(1,275)
Additional paid-in capital		1,260,714		1,243,135
Retained earnings		99,467		174,928
Total Stockholders' Equity	$	1,359,023	$	1,416,797
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	2,362,471	$	2,388,919

GRUBHUB INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)

	Three Months Ended March 31,
	2021		2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(75,461)	$	(33,427)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation		12,294		8,658
Amortization of intangible assets and developed software		25,423		24,705
Stock-based compensation		20,954		20,185
Deferred taxes		(954)		(2,725)
Other		(448)		3,479
Changes in assets and liabilities
Accounts receivable		6,861		(18,333)
Income taxes receivable		243		(16,311)
Prepaid expenses and other assets		(83)		(4,602)
Restaurant food liability		(5,522)		20,857
Accounts payable		(3,460)		4,678
Accrued payroll		13,525		4,277
Other accruals		30,583		26,085
Net cash provided by operating activities		23,955		37,526
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of investments		(31,150)		(19,790)
Proceeds from maturity of investments		28,465		32,900
Capitalized website and development costs		(13,848)		(14,243)
Purchases of property and equipment		(9,833)		(19,678)
Acquisition of other intangible assets		—		(510)
Other cash flows from investing activities		(200)		(250)
Net cash used in investing activities		(26,566)		(21,571)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings under the credit facility		—		175,000
Taxes paid related to net settlement of stock-based compensation awards		(9,028)		(8,051)
Proceeds from exercise of stock options		1,088		1,414
Other cash flows from financing activities		(900)		—
Net cash provided by (used in) financing activities		(8,840)		168,363
Net change in cash, cash equivalents, and restricted cash		(11,451)		184,318
Effect of exchange rates on cash, cash equivalents and restricted cash		66		(600)
Cash, cash equivalents, and restricted cash at beginning of year		362,897		379,594
Cash, cash equivalents, and restricted cash at end of the period	$	351,512	$	563,312

GRUBHUB INC.
NON-GAAP FINANCIAL MEASURES RECONCILIATION
(in thousands, except per share and per order data)

	Three Months Ended March 31,
	2021		2020
Net loss	$	(75,461)	$	(33,427)
Income taxes		(617)		(18,861)
Interest expense, net		7,158		6,380
Depreciation and amortization		37,717		33,363
EBITDA		(31,203)		(12,545)
Merger, acquisition, restructuring and certain legal costs		967		13,376
Stock-based compensation		20,954		20,185
Adjusted EBITDA	$	(9,282)	$	21,016

Net loss per order	$	(1.12)	$	(0.71)
Adjusted EBITDA per order	$	(0.14)	$	0.45

	Three Months Ended March 31,
	2021		2020
Net loss	$	(75,461)	$	(33,427)
Stock-based compensation		20,954		20,185
Amortization of acquired intangible assets		9,702		12,685
Merger, acquisition, restructuring and certain legal costs		967		13,376
Income tax adjustments		(8,696)		(12,856)
Non-GAAP loss	$	(52,534)	$	(37)
Weighted-average diluted shares used to compute Non-GAAP loss per share attributable to common stockholders		93,215		91,793
Non-GAAP loss per diluted share attributable to common stockholders	$	(0.56)	$	(0.00)