GRUB
$75.02
Grubhub
($1.45)
(1.90%)
Earnings Details
1st Quarter March 2019
Thursday, April 25, 2019 4:05:00 PM
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Summary

Grubhub Beats

Grubhub (GRUB) reported 1st Quarter March 2019 earnings of $0.31 per share on revenue of $323.8 million. The consensus earnings estimate was $0.25 per share on revenue of $322.8 million. The Earnings Whisper number was $0.27 per share. Revenue grew 39.2% on a year-over-year basis.

The company said it expects second quarter revenue of $305.0 million to $325.0 million and continues to expect 2019 revenue of $1.315 billion to $1.415 billion. The current consensus estimate is revenue of $326.8 million for the quarter ending June 30, 2019 and revenue of $1.37 billion for the year ending December 31, 2019.

GrubHub Inc provides an online and mobile platform for restaurant pick-up and delivery orders.

Results
Reported Earnings
$0.31
Earnings Whisper
$0.27
Consensus Estimate
$0.25
Reported Revenue
$323.8 Mil
Revenue Estimate
$322.8 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Grubhub Reports First Quarter 2019 Results

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.



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.

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.









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

 

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


 


Grubhub logo. (PRNewsFoto/GrubHub)

 

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SOURCE Grubhub Inc.