EX-99.1 2 grub-ex991_6.htm EX-99.1 grub-ex991_6.htm

Exhibit 99.1

 

 

GRUBHUB REPORTS first QUARTER 2019 RESULTS

 

Grubhub generates 39% revenue growth in the first quarter

 

CHICAGO, April 25, 2019 – 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.

 


 

1 

Key Business Metrics are defined on page 29 of our Annual Report on Form 10-K filed on February 28, 2019.

 

 


 

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.

 

 

 

Second Quarter 2019

 

Full Year 2019

 

 

(in millions)

Expected Revenue range

 

$305 - $325

 

$1,315 - $1,415

Expected Adjusted EBITDA range

 

$49 - $59

 

$235 - $265

 

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.

 

 

 


Exhibit 99.1

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.

 


Contacts:

Adam Patnaude

Investor Relations

ir@grubhub.com

 

Katie Norris

Media Relations

press@grubhub.com

 

 


 

 

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

 

 

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

 

 

 

 

 


 

GRUBHUB INC.

 

CONSOLIDATED BALANCE SHEETS

 

(in thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2019

 

 

December 31, 2018

 

ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

 

Cash and cash equivalents

$

189,694

 

 

$

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

 

PROPERTY AND EQUIPMENT:

 

 

 

 

 

 

 

Property and equipment, net of depreciation and amortization

 

136,347

 

 

 

119,495

 

OTHER ASSETS:

 

 

 

 

 

 

 

Other assets

 

22,427

 

 

 

14,186

 

Operating lease right-of-use asset

 

78,674

 

 

 

 

Goodwill

 

1,005,381

 

 

 

1,019,239

 

Acquired intangible assets, net of amortization

 

534,989

 

 

 

549,013

 

Total other assets

 

1,641,471

 

 

 

1,582,438

 

TOTAL ASSETS

$

2,154,064

 

 

$

2,065,708

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

 

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

 

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