Press Release Details

Grubhub Reports Second Quarter 2019 Results

07/30/2019
Grubhub generates 36% revenue growth in the second quarter

CHICAGO, July 30, 2019 /PRNewswire/ -- Grubhub Inc. (NYSE: GRUB), the nation's leading online and mobile food-ordering and delivery marketplace, today announced financial results for the second quarter ended June 30, 2019. The Company posted revenues of $325 million, which is a 36% year-over-year increase from $240 million in the second quarter of 2018. Gross Food Sales grew 20% year-over-year to $1.5 billion, up from $1.2 billion in the same period last year.

"The team continued executing in the second quarter, adding thousands of new, high-quality independent and enterprise restaurants and growing our active diner base to more than 20 million," said Matt Maloney, Grubhub founder and CEO. "We are excited about the trajectory of our two-sided marketplace – both in terms of geographic diversity and depth in individual markets. Restaurants are increasingly valuing the incremental sales and products we provide, while diners highly regard our robust restaurant selection and consistently low transaction fees."

Second Quarter 2019 Highlights

The following results reflect the financial performance and key operating metrics of our business for the three months ended June 30, 2019, as compared to the same period in 2018.

Second Quarter Financial Highlights

  • Revenues: $325.1 million, a 36% year-over-year increase from $239.7 million in the second quarter of 2018.
  • Net Income: $1.3 million, or $0.01 per diluted share, a 96% year-over-year decrease from $30.1 million, or $0.33 per diluted share, in the second quarter of 2018.
  • Non-GAAP Adjusted EBITDA: $54.7 million, a 19% year-over-year decrease from $67.4 million in the second quarter of 2018.
  • Non-GAAP Net Income: $24.9 million, or $0.27 per diluted share, a 46% year-over-year decrease from $46.3 million, or $0.50 per diluted share, in the second quarter of 2018.

Second Quarter Key Business Metrics Highlights1

  • Active Diners: 20.3 million, a 30% year-over-year increase from 15.6 million Active Diners in the second quarter of 2018.
  • Daily Average Grubs (DAGs): 488,900, a 16% year-over-year increase from 423,200 DAGs in the second quarter of 2018.
  • Gross Food Sales: $1.5 billion, a 20% year-over-year increase from $1.2 billion in the second quarter of 2018.

"Our Adjusted EBITDA per order increased by $0.14 from the first quarter to $1.23 despite the headwind of the seasonally slower second quarter. This sequential improvement was primarily driven by increasing delivery efficiency, especially in our quickly ramping recently launched markets," said Adam DeWitt, Grubhub president and CFO. "We have achieved this profitability improvement while extending our delivery business into smaller and less dense markets, setting us up for continued unit economic improvement as we head into our seasonally stronger months at the end of the year."

Third Quarter and Full Year 2019 Guidance

Based on information available as of July 30, 2019, the Company is providing the following financial guidance for the third quarter and full year of 2019.



Third Quarter 2019


Full Year 2019



(in millions)

Expected Revenue range


$320 - $340


$1,340 - $1,390

Expected Adjusted EBITDA range


$53 - $60


$235 - $250

Second Quarter 2019 Financial Results Conference Call

Grubhub will webcast a conference call today at 9:00 a.m. CT to discuss the second quarter 2019 financial results. The webcast can be accessed on the Grubhub Investor Relations website at https://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.

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 125,000 restaurant partners in over 2,400 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 June 30, 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

June 30,



Six Months Ended
June 30,



2019



2018



2019



2018


Revenues

$

325,058



$

239,741



$

648,828



$

472,311


Costs and expenses:
















Operations and support


162,406




102,445




323,756




198,728


Sales and marketing


74,128




46,231




152,582




94,987


Technology (exclusive of amortization)


29,400




18,717




56,650




36,048


General and administrative


25,784




18,180




48,571




35,877


Depreciation and amortization


27,223




19,849




52,312




40,800


Total costs and expenses


318,941




205,422




633,871




406,440


Income from operations


6,117




34,319




14,957




65,871


Interest expense - net


5,467




8




8,279




1,030


Income before provision for income taxes


650




34,311




6,678




64,841


Income tax (benefit) expense


(602)




4,191




(1,464)




3,955


Net income attributable to common stockholders

$

1,252



$

30,120



$

8,142



$

60,886


Net income per share attributable to common stockholders:
















Basic

$

0.01



$

0.34



$

0.09



$

0.69


Diluted

$

0.01



$

0.33



$

0.09



$

0.67


Weighted-average shares used to compute net income per share attributable to common stockholders:
















Basic


91,177




89,503




91,064




88,294


Diluted


92,786




92,503




92,852




91,297


 

KEY BUSINESS METRICS





Three Months Ended
June 30,



Six Months Ended
June 30,





2019



2018



2019



2018


Active Diners (000s)




20,288




15,581




20,288




15,581


Daily Average Grubs




488,900




423,200




504,900




430,000


Gross Food Sales (millions)



$

1,459



$

1,220



$

2,962



$

2,465


 


GRUBHUB INC.


CONSOLIDATED BALANCE SHEETS


(in thousands, except share data)



























June 30, 2019



December   31,   2018


ASSETS








CURRENT ASSETS:








Cash and cash equivalents

$

358,847



$

211,245


Short-term investments


18,190




14,084


Accounts receivable, less allowances for doubtful accounts


123,801




110,855


Income tax receivable


9,520




9,949


Prepaid expenses and other current assets


23,752




17,642


Total current assets


534,110




363,775


PROPERTY AND EQUIPMENT:








Property and equipment, net of depreciation and amortization


148,995




119,495


OTHER ASSETS:








Other assets


23,166




14,186


Operating lease right-of-use asset


104,078





Goodwill


1,005,477




1,019,239


Acquired intangible assets, net of amortization


527,423




549,013


Total other assets


1,660,144




1,582,438


TOTAL ASSETS

$

2,343,249



$

2,065,708


LIABILITIES AND STOCKHOLDERS' EQUITY








CURRENT LIABILITIES:








Restaurant food liability

$

124,261



$

127,344


Accounts payable


21,527




26,656


Accrued payroll


21,296




18,173


Current portion of long-term debt





6,250


Current operating lease liability


6,875





Other accruals


46,697




44,745


Total current liabilities


220,656




223,168


LONG-TERM LIABILITIES:








Deferred taxes, non-current


32,695




46,383


Noncurrent operating lease liability


114,724





Long-term debt


492,723




335,548


Other accruals


751




18,270


Total long-term liabilities


640,893




400,201


STOCKHOLDERS' EQUITY:








Common stock, $0.0001 par value


9




9


Accumulated other comprehensive loss


(1,980)




(1,891)


Additional paid-in capital


1,126,174




1,094,866


Retained earnings


357,497




349,355


Total Stockholders' Equity

$

1,481,700



$

1,442,339


TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

2,343,249



$

2,065,708


 

GRUBHUB INC.


CONSOLIDATED STATEMENTS OF CASH FLOWS


(in thousands)













Six Months Ended June 30,




2019



2018


CASH FLOWS FROM OPERATING ACTIVITIES









Net income


$

8,142



$

60,886


Adjustments to reconcile net income to net cash from operating activities:









Depreciation



13,626




10,526


Deferred taxes



298




(3,308)


Amortization of intangible assets and developed software



38,686




30,274


Stock-based compensation



36,527




22,170


Other



3,240




3,042


Change in assets and liabilities, net of the effects of business acquisitions:









Accounts receivable



(13,349)




3,888


Income taxes receivable



429




1,882


Prepaid expenses and other assets



(14,857)




(8,446)


Restaurant food liability



(3,078)




(9,870)


Accounts payable



(10,216)




(107)


Accrued payroll



3,122




(1,961)


Other accruals



7,219




7,041


Net cash provided by operating activities



69,789




116,017


CASH FLOWS FROM INVESTING ACTIVITIES









Purchases of investments



(25,526)




(44,271)


Proceeds from maturity of investments



21,636




29,116


Capitalized website and development costs



(22,188)




(13,145)


Purchases of property and equipment



(23,140)




(19,266)


Acquisition of other intangible assets



(8,889)





Acquisitions of businesses, net of cash acquired



127




737


Other cash flows from investing activities






24


Net cash used in investing activities



(57,980)




(46,805)


CASH FLOWS FROM FINANCING ACTIVITIES









Proceeds from the issuance of senior notes



500,000





Repayments of borrowings under the credit facility



(342,313)




(51,562)


Proceeds from the issuance of common stock






200,000


Taxes paid related to net settlement of stock-based compensation awards



(15,360)




(18,717)


Proceeds from exercise of stock options



2,930




9,958


Payments for debt issuance costs



(8,954)





Net cash provided by financing activities



136,303




139,679


Net change in cash, cash equivalents, and restricted cash



148,112




208,891


Effect of exchange rates on cash, cash equivalents and restricted cash



(2)




(318)


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


$

363,912



$

446,812


SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS









Cash paid for income taxes


$

567



$

7,426


 

GRUBHUB INC.

NON-GAAP FINANCIAL MEASURES RECONCILIATION

(in thousands, except per share data)



Three Months Ended
June 30,



Six Months Ended

June 30,



2019



2018



2019



2018


Net income

$

1,252



$

30,120



$

8,142



$

60,886


Income taxes


(602)




4,191




(1,464)




3,955


Interest expense - net


5,467



8




8,279


1


1,030


Depreciation and amortization


27,223




19,849




52,312




40,800


EBITDA


33,340




54,168




67,269




106,671


Acquisition, restructuring and legal costs


1,341




1,312




1,827




2,641


Stock-based compensation


20,049


 2


11,939




36,527


 2


22,170


Adjusted EBITDA

$

54,730



$

67,419



$

105,623



$

131,482





Three Months Ended
June 30,



Six Months Ended
June 30,



2019



2018



2019



2018


Net income

$

1,252



$

30,120



$

8,142



$

60,886


Stock-based compensation


20,049


2


11,939




36,527


2


22,170


Amortization of acquired intangible assets


11,828




9,527




23,770




21,070


Acquisition, restructuring and legal costs


1,341




1,312




1,827




2,641


Income tax adjustments


(9,595)




(6,628)




(17,457)




(13,305)


Non-GAAP net income

$

24,875



$

46,270



$

52,809



$

93,462


Weighted-average diluted shares used to compute net income per share attributable to common stockholders


92,786




92,503




92,852




91,297


Non-GAAP net income per diluted share attributable to common stockholders

$

0.27



$

0.50



$

0.57



$

1.02


 


Guidance



Three Months Ended
September 30, 2019



Year Ended
December 31, 2019



Low



High



Low



High



(in millions)


Net income (loss)

$

(1.6)



$

2.8



$

18.8



$

28.1


Income taxes


(0.9)




1.7




5.1




10.8


Interest expense ̶ net


6.5




6.5




21.3




21.3


Depreciation and amortization


30.0




30.0




114.0




114.0


EBITDA


34.0




41.0




159.2




174.2


Acquisition and restructuring costs








1.8




1.8


Stock-based compensation


19.0




19.0




74.0




74.0


Adjusted EBITDA

$

53.0



$

60.0



$

235.0



$

250.0



_____________________________
1 Interest expense for the three and six months ended June 30, 2019 included $1.8 million and $1.9 million, respectively, of expense for the write-off of unamortized debt issuance costs in February and June of 2019.
Stock-based compensation for the three and six months ended June 30, 2019 included $1.6 million of expense related to the accelerated vesting of equity awards to a terminated acquired employee.

Grubhub is the nation's leading online and mobile food-ordering company. Dedicating 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 40,000 restaurant partners in over 1,000 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, AllMenus, MenuPages, Restaurants on the Run, DiningIn and Delivered Dish. (PRNewsFoto/GrubHub) (PRNewsfoto/Grubhub)

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/grubhub-reports-second-quarter-2019-results-300892809.html

SOURCE Grubhub Inc.

Contact

Email: press@grubhub.com

Only members of the press will receive a response. Please visit our Contact Us page for all other inquiries.

Email Alerts

Email Address *
Mailing Lists *

 
Enter the code shown above.