Grubhub Reports First Quarter 2019 Results
PRNewswire 25-Apr-2019 4:05 PM
CHICAGO, April 25, 2019 /PRNewswire/ -- Grubhub Inc. (NYSE:GRUB), the nation's leading online and mobile food-ordering and delivery marketplace, today announced financial results for the first quarter ended March 31, 2019. The Company posted revenues of $324 million, which is a 39% year-over-year increase from $233 million in the first quarter of 2018. Gross Food Sales grew 21% year-over-year to $1.5 billion, up from $1.2 billion in the same period last year.
"We are extremely proud of our entire team for another fantastic quarter of execution - record new diner growth, thousands of new quality restaurants added to our platform and a sixth consecutive quarter of organic order acceleration. Even with our recent ramp in growth investments, adjusted EBITDA per order improved during the quarter, underscoring our ability to grow in a long-term sustainable manner," said Grubhub Founder and CEO Matt Maloney. "Our partnership model allows restaurant brands, large and small, to own their online business. The success of the Taco Bell launch, which drove meaningful incremental business to both Taco Bell and Grubhub, exemplifies how powerful these partnerships can be."
First Quarter 2019 Highlights
The following results reflect the financial performance and key operating metrics of our business for the three months ended March 31, 2019, as compared to the same period in 2018.
First Quarter Financial Highlights
- Revenues: $323.8 million, a 39% year-over-year increase from $232.6 million in the first quarter of 2018.
- Net Income: $6.9 million, or $0.07 per diluted share, a 78% year-over-year decrease from $30.8 million, or $0.34 per diluted share, in the first quarter of 2018.
- Non-GAAP Adjusted EBITDA: $50.9 million, a 21% year-over-year decrease from $64.1 million in the first quarter of 2018.
- Non-GAAP Net Income: $27.9 million, or $0.30 per diluted share, a 41% year-over-year decrease from $47.2 million, or $0.52 per diluted share, in the first quarter of 2018.
First Quarter Key Business Metrics Highlights1
- Active Diners were 19.3 million, a 28% year-over-year increase from 15.1 million Active Diners in the first quarter of 2018.
- Daily Average Grubs (DAGs) were 521,000, a 19% year-over-year increase from 436,900 DAGs in the first quarter of 2018.
- Gross Food Sales were $1.5 billion, a 21% year-over-year increase from $1.2 billion in the first quarter of 2018.
"The strong momentum in our business throughout 2018 continued in the first quarter of 2019, including continued accelerating growth and a 21% sequential increase in adjusted EBITDA. The dramatic increase in the scale and diversity of our diner base combined with the consistent diner value outlined in the supplemental disclosure sets us up for a great future," added Grubhub President and CFO, Adam DeWitt. "We anticipate our typical seasonality in the second and third quarters and remain on track for both our topline and bottom-line objectives for the full year 2019."
Second Quarter and Full Year 2019 Guidance
Based on information available as of April 25, 2019, the Company is providing the following financial guidance for the second quarter and full year of 2019.
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Second Quarter
2019
|
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Full Year 2019
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(in millions)
|
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Expected Revenue range
|
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$305 - $325
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$1,315 - $1,415
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Expected Adjusted EBITDA range
|
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$49 - $59
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$235 - $265
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First Quarter 2019 Financial Results Conference Call and Supplemental Information
Grubhub will webcast a conference call today at 3:30 p.m. CT to discuss the first quarter 2019 financial results. The webcast can be accessed on the Grubhub Investor Relations website at https://investors.grubhub.com. A replay of the webcast will be available at the same website.
This quarter the Company will post supplemental information about the business and financial results, which will be available on the Grubhub Investor Relations website, along with the Company's earnings press release and financial tables.
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 115,000 restaurant partners in over 2,200 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 March 31, 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.
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1 Key Business Metrics are defined on page 29 of our Annual Report on Form 10-K filed on February 28, 2019.
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GRUBHUB INC.
STATEMENTS OF OPERATIONS
(in thousands, except per share data)
|
|
|
Three Months Ended March 31,
|
|
|
2019
|
|
|
2018
|
|
|
Revenues
|
$
|
323,770
|
|
|
$
|
232,570
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
Operations and support
|
|
161,350
|
|
|
|
96,283
|
|
|
Sales and marketing
|
|
78,454
|
|
|
|
48,756
|
|
|
Technology (exclusive of amortization)
|
|
27,250
|
|
|
|
17,331
|
|
|
General and administrative
|
|
22,787
|
|
|
|
17,697
|
|
|
Depreciation and amortization
|
|
25,089
|
|
|
|
20,951
|
|
|
Total costs and expenses
|
|
314,930
|
|
|
|
201,018
|
|
|
Income from operations
|
|
8,840
|
|
|
|
31,552
|
|
|
Interest expense - net
|
|
2,812
|
|
|
|
1,022
|
|
|
Income before provision for income taxes
|
|
6,028
|
|
|
|
30,530
|
|
|
Income tax benefit
|
|
(862)
|
|
|
|
(236)
|
|
|
Net income attributable to common stockholders
|
$
|
6,890
|
|
|
$
|
30,766
|
|
|
Net income attributable to common stockholders
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.08
|
|
|
$
|
0.35
|
|
|
Diluted
|
$
|
0.07
|
|
|
$
|
0.34
|
|
|
Weighted-average shares used to compute net income per share attributable to common stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
|
90,951
|
|
|
|
87,085
|
|
|
Diluted
|
|
92,918
|
|
|
|
90,091
|
|
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KEY BUSINESS METRICS
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
Active Diners (000s)
|
|
|
19,286
|
|
|
|
15,078
|
|
|
Daily Average Grubs
|
|
|
521,000
|
|
|
|
436,900
|
|
|
Gross Food Sales (millions)
|
|
$
|
1,502.3
|
|
|
$
|
1,245.0
|
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GRUBHUB INC.
|
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CONSOLIDATED BALANCE SHEETS
|
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(in thousands, except share data)
|
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|
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|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
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March 31, 2019
|
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|
December 31, 2018
|
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|
ASSETS
|
|
|
|
|
|
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|
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CURRENT ASSETS:
|
|
|
|
|
|
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Cash and cash equivalents
|
$
|
189,694
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|
|
$
|
211,245
|
|
|
Short-term investments
|
|
14,704
|
|
|
|
14,084
|
|
|
Accounts receivable, less allowances for doubtful accounts
|
|
141,047
|
|
|
|
110,855
|
|
|
Income tax receivable
|
|
10,865
|
|
|
|
9,949
|
|
|
Prepaid expenses and other current assets
|
|
19,936
|
|
|
|
17,642
|
|
|
Total current assets
|
|
376,246
|
|
|
|
363,775
|
|
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PROPERTY AND EQUIPMENT:
|
|
|
|
|
|
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|
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Property and equipment, net of depreciation and amortization
|
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136,347
|
|
|
|
119,495
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OTHER ASSETS:
|
|
|
|
|
|
|
|
|
Other assets
|
|
22,427
|
|
|
|
14,186
|
|
|
Operating lease right-of-use asset
|
|
78,674
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|
|
|
—
|
|
|
Goodwill
|
|
1,005,381
|
|
|
|
1,019,239
|
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Acquired intangible assets, net of amortization
|
|
534,989
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|
|
|
549,013
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Total other assets
|
|
1,641,471
|
|
|
|
1,582,438
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|
TOTAL ASSETS
|
$
|
2,154,064
|
|
|
$
|
2,065,708
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|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
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|
|
|
|
CURRENT LIABILITIES:
|
|
|
|
|
|
|
|
|
Restaurant food liability
|
$
|
140,469
|
|
|
$
|
127,344
|
|
|
Accounts payable
|
|
15,677
|
|
|
|
26,656
|
|
|
Accrued payroll
|
|
18,586
|
|
|
|
18,173
|
|
|
Taxes payable
|
|
1,179
|
|
|
|
422
|
|
|
Current portion of long-term debt
|
|
10,156
|
|
|
|
6,250
|
|
|
Current operating lease liability
|
|
13,436
|
|
|
|
—
|
|
|
Other accruals
|
|
50,164
|
|
|
|
44,323
|
|
|
Total current liabilities
|
|
249,667
|
|
|
|
223,168
|
|
|
LONG-TERM LIABILITIES:
|
|
|
|
|
|
|
|
|
Deferred taxes, non-current
|
|
31,411
|
|
|
|
46,383
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|
|
Noncurrent operating lease liability
|
|
82,405
|
|
|
|
—
|
|
|
Long-term debt
|
|
328,193
|
|
|
|
335,548
|
|
|
Other accruals
|
|
751
|
|
|
|
18,270
|
|
|
Total long-term liabilities
|
|
442,760
|
|
|
|
400,201
|
|
|
STOCKHOLDERS' EQUITY:
|
|
|
|
|
|
|
|
|
Common stock, $0.0001 par value
|
|
9
|
|
|
|
9
|
|
|
Accumulated other comprehensive loss
|
|
(1,664)
|
|
|
|
(1,891)
|
|
|
Additional paid-in capital
|
|
1,107,047
|
|
|
|
1,094,866
|
|
|
Retained earnings
|
|
356,245
|
|
|
|
349,355
|
|
|
Total stockholders' equity
|
$
|
1,461,637
|
|
|
$
|
1,442,339
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$
|
2,154,064
|
|
|
$
|
2,065,708
|
|
|
GRUBHUB INC.
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
6,890
|
|
|
$
|
30,766
|
|
|
Adjustments to reconcile net income to net cash from operating activities:
|
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
6,193
|
|
|
|
5,050
|
|
|
Deferred taxes
|
|
|
(986)
|
|
|
|
(2,976)
|
|
|
Amortization of intangible assets and developed software
|
|
|
18,896
|
|
|
|
15,901
|
|
|
Stock-based compensation
|
|
|
16,478
|
|
|
|
10,231
|
|
|
Other
|
|
|
735
|
|
|
|
2,048
|
|
|
Change in assets and liabilities, net of the effects of business acquisitions:
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
(30,391)
|
|
|
|
(172)
|
|
|
Income taxes receivable
|
|
|
(916)
|
|
|
|
4,090
|
|
|
Prepaid expenses and other assets
|
|
|
(10,666)
|
|
|
|
(3,516)
|
|
|
Restaurant food liability
|
|
|
13,099
|
|
|
|
6,885
|
|
|
Accounts payable
|
|
|
(18,644)
|
|
|
|
601
|
|
|
Accrued payroll
|
|
|
411
|
|
|
|
(3,295)
|
|
|
Other accruals
|
|
|
12,845
|
|
|
|
5,887
|
|
|
Net cash provided by operating activities
|
|
|
13,944
|
|
|
|
71,500
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Purchases of investments
|
|
|
(12,160)
|
|
|
|
(10,537)
|
|
|
Proceeds from maturity of investments
|
|
|
11,636
|
|
|
|
18,166
|
|
|
Capitalized website and development costs
|
|
|
(10,692)
|
|
|
|
(6,262)
|
|
|
Purchases of property and equipment
|
|
|
(8,018)
|
|
|
|
(5,462)
|
|
|
Acquisition of other intangible assets
|
|
|
(5,379)
|
|
|
|
—
|
|
|
Acquisitions of businesses, net of cash acquired
|
|
|
127
|
|
|
|
737
|
|
|
Other cash flows from investing activities
|
|
|
—
|
|
|
|
16
|
|
|
Net cash used in investing activities
|
|
|
(24,486)
|
|
|
|
(3,342)
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
Taxes paid related to net settlement of stock-based compensation awards
|
|
|
(9,966)
|
|
|
|
(11,485)
|
|
|
Proceeds from exercise of stock options
|
|
|
2,424
|
|
|
|
6,948
|
|
|
Repayments of borrowings under the credit facility
|
|
|
(2,031)
|
|
|
|
(25,781)
|
|
|
Payments for debt issuance costs
|
|
|
(1,647)
|
|
|
|
—
|
|
|
Net cash used in financing activities
|
|
|
(11,220)
|
|
|
|
(30,318)
|
|
|
Net change in cash, cash equivalents, and restricted cash
|
|
|
(21,762)
|
|
|
|
37,840
|
|
|
Effect of exchange rates on cash, cash equivalents and restricted cash
|
|
|
232
|
|
|
|
356
|
|
|
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
|
|
$
|
194,272
|
|
|
$
|
276,435
|
|
|
SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS
|
|
|
|
|
|
|
|
|
|
Cash paid for income taxes
|
|
$
|
351
|
|
|
$
|
227
|
|
|
GRUBHUB INC.
NON-GAAP FINANCIAL MEASURES RECONCILIATION
(in thousands, except per share data)
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
Net income
|
|
$
|
6,890
|
|
|
$
|
30,766
|
|
|
Income taxes
|
|
|
(862)
|
|
|
|
(236)
|
|
|
Interest expense - net
|
|
|
2,812
|
|
|
|
1,022
|
|
|
Depreciation and amortization
|
|
|
25,089
|
|
|
|
20,951
|
|
|
EBITDA
|
|
|
33,929
|
|
|
|
52,503
|
|
|
Acquisition, restructuring and legal costs
|
|
|
486
|
|
|
|
1,329
|
|
|
Stock-based compensation
|
|
|
16,478
|
|
|
|
10,231
|
|
|
Adjusted EBITDA
|
|
$
|
50,893
|
|
|
$
|
64,063
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
2019
|
|
|
2018
|
|
|
Net income
|
|
$
|
6,890
|
|
|
$
|
30,766
|
|
|
Stock-based compensation
|
|
|
16,478
|
|
|
|
10,231
|
|
|
Amortization of acquired intangible assets
|
|
|
11,942
|
|
|
|
11,543
|
|
|
Acquisition, restructuring and legal costs
|
|
|
486
|
|
|
|
1,329
|
|
|
Income tax adjustments
|
|
|
(7,862)
|
|
|
|
(6,677)
|
|
|
Non-GAAP net income
|
|
$
|
27,934
|
|
|
$
|
47,192
|
|
|
Weighted-average diluted shares used to compute net income per share attributable to common stockholders
|
|
|
92,918
|
|
|
|
90,091
|
|
|
Non-GAAP net income per diluted share attributable to common stockholders
|
|
$
|
0.30
|
|
|
$
|
0.52
|
|
|
|
Guidance
|
|
|
|
Three Months Ended
June 30, 2019
|
|
|
Year Ended
December 31, 2019
|
|
|
|
Low
|
|
|
High
|
|
|
Low
|
|
|
High
|
|
|
|
(in millions)
|
|
|
Net income
|
|
$
|
0.6
|
|
|
$
|
7.5
|
|
|
$
|
29.7
|
|
|
$
|
50.4
|
|
|
Income taxes
|
|
|
0.3
|
|
|
|
3.4
|
|
|
|
13.4
|
|
|
|
22.7
|
|
|
Interest expense ? net
|
|
|
2.8
|
|
|
|
2.8
|
|
|
|
11.4
|
|
|
|
11.4
|
|
|
Depreciation and amortization
|
|
|
27.0
|
|
|
|
27.0
|
|
|
|
106.0
|
|
|
|
106.0
|
|
|
EBITDA
|
|
|
30.7
|
|
|
|
40.7
|
|
|
|
160.5
|
|
|
|
190.5
|
|
|
Acquisition and restructuring costs
|
|
|
—
|
|
|
|
—
|
|
|
|
0.5
|
|
|
|
0.5
|
|
|
Stock-based compensation
|
|
|
18.3
|
|
|
|
18.3
|
|
|
|
74.0
|
|
|
|
74.0
|
|
|
Adjusted EBITDA
|
|
$
|
49.0
|
|
|
$
|
59.0
|
|
|
$
|
235.0
|
|
|
$
|
265.0
|
|
View original content to download multimedia:http://www.prnewswire.com/news-releases/grubhub-reports-first-quarter-2019-results-300838648.html
SOURCE Grubhub Inc.
