Attached files
| file | filename |
|---|---|
| 8-K - 8-K - GrubHub Inc. | grub-8k_20161026.htm |
Exhibit 99.1
GRUBHUB REPORTS RECORD THIRD QUARTER RESULTS
Grubhub generates 44% revenue growth in the third quarter
CHICAGO, Oct. 26, 2016 – Grubhub Inc. (NYSE: GRUB), the nation’s leading takeout marketplace, today announced financial results for the quarter ended Sept. 30, 2016. Order growth accelerated to 26% year-over-year, and the Company posted quarterly revenues of $123.5 million, which is a 44% year-over-year increase from $85.7 million in the third quarter of 2015.
“We are pleased with Grubhub’s third quarter growth, as we continue building the most comprehensive marketplace for restaurants and takeout diners. Our product improvements and investment in delivery continue to generate high levels of sustainable growth,” said Matt Maloney, Grubhub CEO. “Grubhub is now delivering for restaurant partners in over 60 markets nationwide, and our growth rate is generally highest in markets where a substantial percentage of orders are being delivered by our drivers.”
Third Quarter 2016 Highlights
The following results reflect the financial performance and key operating metrics of our business for the three months ended Sept. 30, 2016, as compared to the same period in 2015.
Third Quarter Financial Highlights
|
|
• |
Revenues: $123.5 million, a 44% year-over-year increase from $85.7 million in the third quarter of 2015. |
|
|
• |
Net Income: $13.2 million, or $0.15 per diluted share, a 92% year-over-year increase from $6.9 million, or $0.08 per diluted share, in the third quarter of 2015. |
|
|
• |
Non-GAAP Adjusted EBITDA: $35.5 million, a 65% year-over-year increase from $21.5 million in the third quarter of 2015. |
|
|
• |
Non-GAAP Net Income: $19.9 million, or $0.23 per diluted share, a 73% year-over-year increase from $11.5 million, or $0.13 per diluted share. |
Third Quarter Key Business Metrics Highlights
|
|
• |
Active Diners were 7.69 million, a 19% year-over-year increase from 6.43 million Active Diners in the third quarter of 2015. |
|
|
• |
Daily Average Grubs were 267,500, a 26% year-over-year increase from 211,500 Daily Average Grubs in the third quarter of 2015. |
|
|
• |
Gross Food Sales were $735 million, a 33% year-over-year increase from $554 million in the third quarter of 2015. |
"Grubhub had strong topline and bottom line results in the third quarter, generating record net revenues and significant operating leverage,” said Adam DeWitt, Grubhub CFO. “This strong growth, combined with the high incremental margins of our business model, drove adjusted EBITDA per order to $1.44, a 31% increase compared to the third quarter of 2015.”
Fourth Quarter Guidance
Based on information available as of Oct. 26, 2016, the Company is providing the following financial guidance for the fourth quarter of 2016:
|
|
Fourth Quarter 2016 |
|
|
(in millions) |
|
Expected Revenue range |
$136 - $138 |
|
Expected Adjusted EBITDA range |
$38 - $40 |
Third Quarter 2016 Financial Results Conference Call: Grubhub will webcast a conference call today at 9 a.m. CDT to discuss the third quarter 2016 financial results. The webcast can be accessed on the Grubhub Investor Relations website at http://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 until Nov. 9, 2016.
About Grubhub
Grubhub (NYSE: GRUB) is the nation’s leading online and mobile takeout food-ordering marketplace with the most comprehensive network of restaurant partners and largest active diner base. Dedicated to moving eating forward and connecting diners with the food they love from their favorite local restaurants, the Company's platforms and services strive 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 45,000 restaurant partners in over 1,100 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, AllMenus, MenuPages, LAbite, Restaurants on the Run, DiningIn and Delivered Dish.
Use of Forward Looking Statements:
This press release contains forward-looking statements regarding our management's future expectations, beliefs, intentions, goals, strategies, plans and prospects, including the expected financial performance of Grubhub following its recent acquisitions and investment in delivery. 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 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 Feb. 26, 2016, which are on file with the SEC and are available on the Investor Relations section of our website at http://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 Sept. 30, 2016, which should be read in conjunction with these financial results. Please also note that forward-looking statements represent our management's beliefs and assumptions only as of the date of this press release. Except as required by law, we assume 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 and restructuring costs, income taxes, 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 and restructuring 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 and restructuring, 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 “Schedule of 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.
|
Dave Zaragoza Corporate Finance & Investor Relations ir@grubhub.com |
Katie Norris Press press@grubhub.com |
GRUBHUB INC.
STATEMENTS OF OPERATIONS
(in thousands, except per share data)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
||||
|
Revenues |
$ |
123,461 |
|
|
$ |
85,662 |
|
|
$ |
355,874 |
|
|
$ |
261,866 |
|
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing |
|
26,499 |
|
|
|
21,443 |
|
|
|
80,687 |
|
|
|
66,229 |
|
|
Operations and support |
|
44,346 |
|
|
|
27,637 |
|
|
|
120,029 |
|
|
|
74,941 |
|
|
Technology (exclusive of amortization) |
|
11,006 |
|
|
|
8,412 |
|
|
|
31,765 |
|
|
|
23,980 |
|
|
General and administrative |
|
11,754 |
|
|
|
10,203 |
|
|
|
37,501 |
|
|
|
29,049 |
|
|
Depreciation and amortization |
|
9,089 |
|
|
|
6,299 |
|
|
|
25,282 |
|
|
|
21,377 |
|
|
Total costs and expenses |
|
102,694 |
|
|
|
73,994 |
|
|
|
295,264 |
|
|
|
215,576 |
|
|
Income before provision for income taxes |
|
20,767 |
|
|
|
11,668 |
|
|
|
60,610 |
|
|
|
46,290 |
|
|
Provision for income taxes |
|
7,585 |
|
|
|
4,801 |
|
|
|
24,690 |
|
|
|
19,501 |
|
|
Net income attributable to common stockholders |
$ |
13,182 |
|
|
$ |
6,867 |
|
|
$ |
35,920 |
|
|
$ |
26,789 |
|
|
Net income per share attributable to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.15 |
|
|
$ |
0.08 |
|
|
$ |
0.42 |
|
|
$ |
0.32 |
|
|
Diluted |
$ |
0.15 |
|
|
$ |
0.08 |
|
|
$ |
0.42 |
|
|
$ |
0.31 |
|
|
Weighted-average shares used to compute net income per share attributable to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
85,217 |
|
|
|
84,583 |
|
|
|
84,889 |
|
|
|
83,827 |
|
|
Diluted |
|
86,424 |
|
|
|
85,867 |
|
|
|
85,957 |
|
|
|
85,599 |
|
KEY OPERATING METRICS
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
||||
|
Active Diners (000s) |
|
7,685 |
|
|
|
6,431 |
|
|
|
7,685 |
|
|
|
6,431 |
|
|
Daily Average Grubs |
|
267,500 |
|
|
|
211,500 |
|
|
|
268,800 |
|
|
|
222,000 |
|
|
Gross Food Sales (millions) |
$ |
735.0 |
|
|
$ |
553.6 |
|
|
$ |
2,180.4 |
|
|
$ |
1,711.1 |
|
|
GRUBHUB INC. |
|
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|
CONSOLIDATED BALANCE SHEETS |
|
||||||
|
(in thousands, except share data) |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 30, 2016 |
|
|
December 31, 2015 |
|
||
|
ASSETS |
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
177,838 |
|
|
$ |
169,293 |
|
|
Short term investments |
|
118,743 |
|
|
|
141,448 |
|
|
Accounts receivable, less allowances for doubtful accounts |
|
65,729 |
|
|
|
42,051 |
|
|
Prepaid expenses |
|
6,264 |
|
|
|
3,482 |
|
|
Total current assets |
|
368,574 |
|
|
|
356,274 |
|
|
PROPERTY AND EQUIPMENT: |
|
|
|
|
|
|
|
|
Property and equipment, net of depreciation and amortization |
|
43,398 |
|
|
|
19,082 |
|
|
OTHER ASSETS: |
|
|
|
|
|
|
|
|
Other assets |
|
4,873 |
|
|
|
3,105 |
|
|
Goodwill |
|
437,009 |
|
|
|
396,220 |
|
|
Acquired intangible assets, net of amortization |
|
318,431 |
|
|
|
285,567 |
|
|
Total other assets |
|
760,313 |
|
|
|
684,892 |
|
|
TOTAL ASSETS |
$ |
1,172,285 |
|
|
$ |
1,060,248 |
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Restaurant food liability |
$ |
78,321 |
|
|
$ |
64,326 |
|
|
Accounts payable |
|
9,532 |
|
|
|
8,189 |
|
|
Accrued payroll |
|
6,103 |
|
|
|
4,841 |
|
|
Taxes payable |
|
785 |
|
|
|
426 |
|
|
Other accruals |
|
16,054 |
|
|
|
11,830 |
|
|
Total current liabilities |
|
110,795 |
|
|
|
89,612 |
|
|
LONG TERM LIABILITIES: |
|
|
|
|
|
|
|
|
Deferred taxes, non-current |
|
105,642 |
|
|
|
87,584 |
|
|
Other accruals |
|
6,245 |
|
|
|
5,456 |
|
|
Total long term liabilities |
|
111,887 |
|
|
|
93,040 |
|
|
STOCKHOLDERS’ EQUITY: |
|
|
|
|
|
|
|
|
Common stock, $0.0001 par value |
|
9 |
|
|
|
8 |
|
|
Accumulated other comprehensive loss |
|
(1,641 |
) |
|
|
(604 |
) |
|
Additional paid-in capital |
|
796,414 |
|
|
|
759,292 |
|
|
Retained earnings |
|
154,821 |
|
|
|
118,900 |
|
|
Total Stockholders’ Equity |
$ |
949,603 |
|
|
$ |
877,596 |
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
1,172,285 |
|
|
$ |
1,060,248 |
|
|
GRUBHUB INC. |
|
|||||||
|
CONSOLIDATED STATEMENTS OF CASH FLOWS |
|
|||||||
|
(in thousands) |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|||||
|
|
|
2016 |
|
|
2015 |
|
||
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
35,920 |
|
|
$ |
26,789 |
|
|
Adjustments to reconcile net income to net cash from operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
5,567 |
|
|
|
3,846 |
|
|
Provision for doubtful accounts |
|
|
719 |
|
|
|
565 |
|
|
Deferred taxes |
|
|
(1,908 |
) |
|
|
(2,793 |
) |
|
Amortization of intangible assets |
|
|
19,715 |
|
|
|
17,531 |
|
|
Stock-based compensation |
|
|
17,755 |
|
|
|
9,378 |
|
|
Deferred rent |
|
|
980 |
|
|
|
(73 |
) |
|
Other |
|
|
(292 |
) |
|
|
553 |
|
|
Change in assets and liabilities, net of the effects of business acquisitions: |
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(22,299 |
) |
|
|
(6,912 |
) |
|
Prepaid expenses and other assets |
|
|
(2,874 |
) |
|
|
(1,456 |
) |
|
Restaurant food liability |
|
|
11,361 |
|
|
|
(31,444 |
) |
|
Accounts payable |
|
|
(4,592 |
) |
|
|
(633 |
) |
|
Accrued payroll |
|
|
582 |
|
|
|
(2,150 |
) |
|
Other accruals |
|
|
1,799 |
|
|
|
389 |
|
|
Net cash provided by operating activities |
|
|
62,433 |
|
|
|
13,590 |
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
|
|
|
|
Purchases of investments |
|
|
(187,456 |
) |
|
|
(154,268 |
) |
|
Proceeds from maturity of investments |
|
|
210,567 |
|
|
|
122,856 |
|
|
Capitalized website and development costs |
|
|
(8,859 |
) |
|
|
(4,961 |
) |
|
Purchases of property and equipment |
|
|
(17,083 |
) |
|
|
(2,866 |
) |
|
Acquisitions of businesses, net of cash acquired |
|
|
(65,849 |
) |
|
|
(55,687 |
) |
|
Acquisition of other intangible assets |
|
|
(250 |
) |
|
|
— |
|
|
Other cash flows from investing activities |
|
|
(540 |
) |
|
|
— |
|
|
Net cash used in investing activities |
|
|
(69,470 |
) |
|
|
(94,926 |
) |
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
|
|
|
|
Repurchases of common stock |
|
|
(14,774 |
) |
|
|
— |
|
|
Proceeds from exercise of stock options |
|
|
11,814 |
|
|
|
10,689 |
|
|
Excess tax benefits related to stock-based compensation |
|
|
22,114 |
|
|
|
21,987 |
|
|
Taxes paid related to net settlement of stock-based compensation awards |
|
|
(1,205 |
) |
|
|
— |
|
|
Payments for debt issuance costs |
|
|
(1,477 |
) |
|
|
— |
|
|
Net cash provided by financing activities |
|
|
16,472 |
|
|
|
32,676 |
|
|
Net change in cash and cash equivalents |
|
|
9,435 |
|
|
|
(48,660 |
) |
|
Effect of exchange rates on cash |
|
|
(890 |
) |
|
|
(108 |
) |
|
Cash and cash equivalents at beginning of year |
|
|
169,293 |
|
|
|
201,796 |
|
|
Cash and cash equivalents at end of the period |
|
$ |
177,838 |
|
|
$ |
153,028 |
|
|
SUPPLEMENTAL DISCLOSURE OF NON CASH ITEMS |
|
|
|
|
|
|
|
|
|
Fair value of common stock issued for acquisitions |
|
$ |
— |
|
|
$ |
15,980 |
|
|
Cash paid for income taxes |
|
|
5,757 |
|
|
|
— |
|
NON-GAAP FINANCIAL MEASURES RECONCILIATION
(in thousands, except per share data)
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
||||
|
Net income |
$ |
13,182 |
|
|
$ |
6,867 |
|
|
$ |
35,920 |
|
|
$ |
26,789 |
|
|
Income taxes |
|
7,585 |
|
|
|
4,801 |
|
|
|
24,690 |
|
|
|
19,501 |
|
|
Depreciation and amortization |
|
9,089 |
|
|
|
6,299 |
|
|
|
25,282 |
|
|
|
21,377 |
|
|
EBITDA |
|
29,856 |
|
|
|
17,967 |
|
|
|
85,892 |
|
|
|
67,667 |
|
|
Acquisition and restructuring costs |
|
261 |
|
|
|
383 |
|
|
|
1,789 |
|
|
|
1,086 |
|
|
Stock-based compensation |
|
5,349 |
|
|
|
3,113 |
|
|
|
17,755 |
|
|
|
9,378 |
|
|
Adjusted EBITDA |
$ |
35,466 |
|
|
$ |
21,463 |
|
|
$ |
105,436 |
|
|
$ |
78,131 |
|
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
||||||||||
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
||||
|
Net income |
$ |
13,182 |
|
|
$ |
6,867 |
|
|
$ |
35,920 |
|
|
$ |
26,789 |
|
|
Stock-based compensation |
|
5,349 |
|
|
|
3,113 |
|
|
|
17,755 |
|
|
|
9,378 |
|
|
Amortization of acquired intangible assets |
|
5,385 |
|
|
|
4,674 |
|
|
|
16,070 |
|
|
|
13,462 |
|
|
Accelerated write-down of Seamless technology platform |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,897 |
|
|
Acquisition and restructuring costs |
|
261 |
|
|
|
383 |
|
|
|
1,789 |
|
|
|
1,086 |
|
|
Income tax adjustments |
|
(4,243 |
) |
|
|
(3,538 |
) |
|
|
(14,780 |
) |
|
|
(11,181 |
) |
|
Non-GAAP net income |
$ |
19,934 |
|
|
$ |
11,499 |
|
|
$ |
56,754 |
|
|
$ |
41,431 |
|
|
Weighted-average diluted shares used to compute net income per share attributable to common stockholders |
|
86,424 |
|
|
|
85,867 |
|
|
|
85,957 |
|
|
|
85,599 |
|
|
Non-GAAP net income per diluted share attributable to common stockholders |
$ |
0.23 |
|
|
$ |
0.13 |
|
|
$ |
0.66 |
|
|
$ |
0.48 |
|
|
|
Guidance |
|
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Three Months Ended December 31, 2016 |
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Low |
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High |
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(in millions) |
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Net income |
$ |
14 |
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$ |
15 |
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Income taxes |
|
9 |
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|
10 |
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Depreciation and amortization |
|
9 |
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|
9 |
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|
EBITDA |
|
32 |
|
|
|
34 |
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|
Acquisition and restructuring costs |
|
— |
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|
— |
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Stock-based compensation |
|
6 |
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|
6 |
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Adjusted EBITDA |
$ |
38 |
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|
$ |
40 |
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