Press Release Details

Grubhub Reports Record First Quarter Results

05/03/2016

Grubhub generates 27% revenue growth in the first quarter

CHICAGO, May 3, 2016 /PRNewswire/ -- Grubhub Inc. (NYSE: GRUB), the leading takeout marketplace, today announced financial results for the quarter ended March 31, 2016. 

"We had a strong start to 2016, generating a record $713 million in gross food sales during the quarter, even with significant headwinds from weather," said Matt Maloney, CEO. "Revenue grew 27%, driven by the continued expansion of quality restaurants through Grubhub delivery, improvements in our technology platform and the rollout of our updated Grubhub branding." 

First Quarter 2016 Highlights

The following results reflect the financial performance and key operating metrics of our business for the three months ended March 31, 2016 as compared to the same period in 2015.

First Quarter Financial Highlights

  • Revenues: $112.2 million, a 27% year-over-year increase from $88.2 million in the first quarter of 2015.
  • Non-GAAP Adjusted EBITDA: $32.4 million, a 15% year-over-year increase from $28.3 million in the first quarter of 2015.
  • Net Income: $9.9 million, or $0.12 per diluted share, a 6% year-over-year decrease from $10.6 million, or $0.12 per diluted share, in the first quarter of 2015.
  • Non-GAAP Net Income: $17.2 million, or $0.20 per diluted share, a 15% year-over-year increase from $14.9 million, or $0.18 per diluted share.

First Quarter Key Business Metrics Highlights

  • Active Diners were 6.97 million, a 24% year-over-year increase from 5.60 million Active Diners in the first quarter of 2015.
  • Daily Average Grubs were 267,800, a 14% year-over-year increase from 234,700 Daily Average Grubs in the first quarter of 2015.
  • Gross Food Sales were $713 million, a 21% year-over-year increase from $590 million in the first quarter of 2015.

Delivery

The Company has entered into an agreement to acquire LAbite, one of the largest restaurant delivery services in the U.S. In 2015, LAbite diners ordered almost $80 million in gross food sales, with most of the volume coming from the greater Los Angeles area.

"We are excited by the acquisition of LAbite as it adds to the tremendous strides we've made in expanding the breadth and depth of our delivery network and boosts our presence in an important market," noted Maloney. "With more than 5,000 restaurants now using Grubhub delivery and our total network comprised of more than 44,000 restaurants, we are making great progress towards fulfilling our goal of being the most comprehensive marketplace for takeout diners and restaurants."

Excluding the pending acquisition of LAbite, Grubhub is now delivering annual gross food sales volume of approximately $250 million.  This compares to almost no delivery volume at the beginning of 2015.

Credit Facility

On April 29, 2016, the Company entered into a revolving credit facility.  The credit facility will be available to the Company until April 28, 2021 and provides for a commitment of $185 million and the ability to increase the line under certain conditions up to $215 million.

Second Quarter and Full Year 2016 Guidance*

Based on information available as of May 3rd, 2016, the company is providing the following financial guidance for the second quarter and full year of 2016:


Second Quarter 2016


Full Year 2016


(in millions)

Expected revenue range

$109 - $111


$450 - $465

Expected Adjusted EBITDA range

$29 - $31


$122 - $130

*The above guidance excludes any impact from Grubhub's pending acquisition of LAbite.  The Company will update guidance to include LAbite when the acquisition closes.

First Quarter 2016 Financial Results Conference Call: Grubhub will webcast a conference call today at 9 a.m. CT to discuss the first 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 May 17, 2016.

About Grubhub

Grubhub (NYSE: GRUB) is the nation's leading online and mobile food-ordering company. 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 44,000 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.

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 February 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 March 31, 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.

 

GRUBHUB INC.


STATEMENTS OF OPERATIONS

(in thousands, except per share data)



Three Months Ended

March 31,


2016


2015

Revenues

$

112,240


$

88,249

Costs and expenses:






Sales and marketing


28,833



24,107

Operations and support


34,987



22,701

Technology (exclusive of amortization)


10,192



7,666

General and administrative


13,589



9,101

Depreciation and amortization


7,308



6,249

Total costs and expenses


94,909



69,824

Income before provision for income taxes


17,331



18,425

Provision for income taxes


7,398



7,855

Net income attributable to common stockholders

$

9,933


$

10,570

Net income per share attributable to common stockholders:






Basic

$

0.12


$

0.13

Diluted

$

0.12


$

0.12

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






Basic


84,710



82,783

Diluted


85,699



85,098

 

KEY OPERATING METRICS



Three Months Ended

March 31,


2016


2015

Active Diners (000s)


6,970



5,604

Daily Average Grubs


267,800



234,700

Gross Food Sales (millions)

$

712.8


$

589.9

 


GRUBHUB INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)




















March 31, 2016


December 31, 2015

ASSETS






CURRENT ASSETS:






Cash and cash equivalents

$

203,312


$

169,293

Short term investments


121,129



141,448

Accounts receivable, less allowances for doubtful accounts


51,414



42,051

Prepaid expenses


3,578



3,482

Total current assets


379,433



356,274

PROPERTY AND EQUIPMENT:






Property and equipment, net of depreciation and amortization


24,226



19,082

OTHER ASSETS:






Other assets


3,383



3,105

Goodwill


396,220



396,220

Acquired intangible assets, net of amortization


280,772



285,567

Total other assets


680,375



684,892

TOTAL ASSETS

$

1,084,034


$

1,060,248

LIABILITIES AND STOCKHOLDERS' EQUITY






CURRENT LIABILITIES:






Restaurant food liability

$

74,375


$

64,326

Accounts payable


4,176



8,189

Accrued payroll


3,805



4,841

Taxes payable


423



426

Other accruals


15,699



11,830

Total current liabilities


98,478



89,612

LONG TERM LIABILITIES:






Deferred taxes, non-current


84,262



87,584

Other accruals


5,523



5,456

Total long term liabilities


89,785



93,040

Commitments and contingencies






STOCKHOLDERS' EQUITY:






Common stock, $0.0001 par value


8



8

Accumulated other comprehensive loss


(826)



(604)

Additional paid-in capital


767,756



759,292

Retained earnings


128,833



118,900

Total Stockholders' Equity

$

895,771


$

877,596

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

1,084,034


$

1,060,248

 

GRUBHUB INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)








Three Months Ended March 31,


2016


2015

CASH FLOWS FROM OPERATING ACTIVITIES






Net income

$

9,933


$

10,570

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






Depreciation


1,344



1,215

Provision for doubtful accounts


443



93

Deferred taxes


(3,321)



1,219

Amortization of intangible assets


5,964



5,034

Stock-based compensation


6,901



3,007

Other


26



239

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






Accounts receivable


(9,956)



(11,862)

Prepaid expenses and other assets


(136)



255

Restaurant food liability


10,081



24,376

Accounts payable


(5,434)



(1,826)

Accrued payroll


(1,034)



(3,146)

Other accruals


3,855



1,248

Net cash provided by operating activities


18,666



30,422

CASH FLOWS FROM INVESTING ACTIVITIES






Purchases of investments


(56,227)



(37,068)

Proceeds from maturity of investments


76,615



38,060

Capitalized website and development costs


(2,331)



(1,213)

Purchases of property and equipment


(3,259)



(441)

Acquisitions of businesses, net of cash acquired




(55,506)

Acquisition of other intangible assets


(250)



Other cash flows from investing activities


(173)



Net cash provided by (used in) investing activities


14,375



(56,168)

CASH FLOWS FROM FINANCING ACTIVITIES






Repurchases of common stock


(9,771)



Proceeds from exercise of stock options


1,012



5,823

Excess tax benefits related to stock-based compensation


10,610



6,492

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


(682)



Net cash provided by financing activities


1,169



12,315

Net change in cash and cash equivalents


34,210



(13,431)

Effect of exchange rates on cash


(191)



(210)

Cash and cash equivalents at beginning of year


169,293



201,796

Cash and cash equivalents at end of the period

$

203,312


$

188,155

SUPPLEMENTAL DISCLOSURE OF NON CASH ITEMS






Fair value of common stock issued for acquisitions

$


$

15,980

 

NON-GAAP FINANCIAL MEASURES RECONCILIATION

(in thousands, except per share data)



Three Months Ended

March 31,


2016


2015

Net income

$

9,933


$

10,570

Income taxes


7,398



7,855

Depreciation and amortization


7,308



6,249

EBITDA


24,639



24,674

Acquisition and restructuring costs


831



569

Stock-based compensation


6,901



3,007

Adjusted EBITDA

$

32,371


$

28,250

 


Three Months Ended

 March 31,


2016


2015

Net income

$

9,933


$

10,570

Stock-based compensation


6,901



3,007

Amortization of acquired intangible assets


5,045



4,115

Acquisition and restructuring costs


831



569

Income tax adjustments


(5,469)



(3,330)

Non-GAAP net income

$

17,241


$

14,931

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


85,699



85,098

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

$

0.20


$

0.18

 

 Grubhub logo.

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To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/grubhub-reports-record-first-quarter-results-300261372.html

SOURCE GrubHub Inc.

Anan Kashyap, Corporate Finance & Investor Relations, ir@grubhub.com; or Katie Norris, Press, press@grubhub.com