Grubhub Reports Fourth Quarter And Full Year 2015 Results

Grubhub generates 36% revenue growth in the fourth quarter

04 Feb, 2016, 09:00 ET from GrubHub Inc.

CHICAGO, Feb. 4, 2016 /PRNewswire/ -- Grubhub Inc. (NYSE: GRUB), the leading takeout marketplace, today announced financial results for the quarter and year ended December 31, 2015. 

"The fourth quarter capped off a strong year for Grubhub.  We generated a record $643 million in gross food sales during the quarter and $2.4 billion during the year," said Matt Maloney, CEO.  "The growth in our delivery network has greatly expanded our potential universe of restaurant partners, helping us work with restaurants that don't currently offer delivery, but want access to our 6.7 million active diners.  As a result, our restaurant network is broader and deeper than ever, with over 40,000 partners in more than 1,000 cities."

Fourth Quarter and Full Year 2015 Highlights

The following results reflect the financial performance and key operating metrics of our business for the three months and year ended December 31, 2015 as compared to the same period in 2014.

Fourth Quarter Financial Highlights

  • Revenues: $100.0 million, a 36% year-over-year increase from $73.3 million in the fourth quarter of 2014.
  • Non-GAAP Adjusted EBITDA: $26.8 million, a 7% year-over-year increase from $25.0 million in the fourth quarter of 2014.
  • Net Income: $11.3 million, or $0.13 per diluted share, a 5% year-over-year increase from $10.8 million, or $0.13 per diluted share, in the fourth quarter of 2014.
  • Non-GAAP Net Income: $16.7 million, or $0.19 per diluted share, a 16% year-over-year increase from $14.4 million, or $0.17 per diluted share.

Fourth Quarter Key Business Metrics Highlights

  • Active Diners were 6.75 million, a 34% year-over-year increase from 5.03 million Active Diners in the fourth quarter of 2014.
  • Daily Average Grubs were 241,800, a 19% year-over-year increase from 202,700 Daily Average Grubs in the fourth quarter of 2014.
  • Gross Food Sales were $643 million, a 26% year-over-year increase from $508 million in the fourth quarter of 2014.

Full Year Financial Highlights

  • Revenues: $361.8 million, a 43% year-over-year increase from $253.9 million in 2014.
  • Non-GAAP Adjusted EBITDA: $105.0 million, a 33% year-over-year increase from $78.7 million in 2014.
  • Net Income: $38.1 million, or $0.44 per diluted share, a 57% year-over-year increase from $24.3 million, or $0.30 per diluted share, in 2014.
  • Non-GAAP Net Income: $58.1 million, or $0.68 per diluted share, a 51% year-over-year increase from $38.5 million, or $0.47 per diluted share, in 2014.

Full Year Key Business Metrics Highlights

  • Active Diners were 6.75 million, a 34% increase from 5.03 million Active Diners in 2014.
  • Daily Average Grubs were 227,100, a 24% year-over-year increase from 182,800 Daily Average Grubs in 2014.
  • Gross Food Sales were $2.4 billion, a 32% year-over-year increase from $1.8 billion processed in 2014.

"We are incredibly proud of the progress we made in 2015.  Our significant upgrades in product and technology as well as our investments in restaurant partnerships set us up for continued growth in 2016 and beyond," continued Maloney.  "Our capital-efficient model and strong free cash flow have enabled us to introduce a share buyback to return value opportunistically to shareholders while increasing our overall flexibility through the planned establishment of a credit facility.  This flexibility will allow us to acquire attractive assets at reasonable prices if the recent market volatility creates opportunities."

First Quarter and Full Year 2016 Guidance

Based on information available as of February 4, 2016, the company is providing the following financial guidance for the first quarter and full year of 2016:

First Quarter 2016

Full Year 2016

(in millions)

Expected revenue range

$109 - $112

$445 - $465

Expected Adjusted EBITDA range

$30 - $33

$122 - $130

Fourth Quarter 2015 Financial Results Conference Call: Grubhub will webcast a conference call today at 9 a.m. CT to discuss the fourth quarter 2015 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 February 18, 2016.

About Grubhub Grubhub (NYSE: GRUB) is one of the nation's largest portfolios of online and mobile takeout food ordering and delivery services. Connecting diners to more than 40,000 restaurants in more than 1,000 U.S. cities and London, the company's platforms and services strive to make takeout better through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. The Grubhub Inc. 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 March 5, 2015 and our most recent Quarterly Report on Form 10-Q for the quarter ended September 30, 2015, 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 Annual Report on Form 10-K that will be filed for the year ended December 31, 2015, 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.

Contacts:

Anan Kashyap

Katie Norris

Corporate Finance & Investor Relations

Press

ir@grubhub.com

press@grubhub.com

 

GRUBHUB INC.

STATEMENTS OF OPERATIONS

(in thousands, except per share data)

Three Months Ended

December 31,

Year Ended

December 31,

2015

2014

2015

2014

Revenues

$

99,959

$

73,313

$

361,825

$

253,873

Costs and expenses:

Sales and marketing

24,921

19,033

91,150

66,201

Operations and support

32,483

17,766

107,424

62,509

Technology (exclusive of amortization)

8,802

7,212

32,782

25,185

General and administrative

11,457

7,220

40,506

32,307

Depreciation and amortization

6,657

5,809

28,034

22,687

Total costs and expenses

84,320

57,040

299,896

208,889

Income before provision for income taxes

15,639

16,273

61,929

44,984

Provision for income taxes

4,351

5,508

23,852

20,721

Net income

$

11,288

$

10,765

$

38,077

$

24,263

Net income per share attributable to common stockholders:

Basic

$

0.13

$

0.13

$

0.45

$

0.33

Diluted

$

0.13

$

0.13

$

0.44

$

0.30

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

Basic

84,823

81,605

84,076

73,571

Diluted

86,028

84,311

85,706

81,698

KEY OPERATING METRICS

Three Months Ended December 31,

Year Ended December 31,

2015

2014

2015

2014

Active Diners (000s)

6,746

5,029

6,746

5,029

Daily Average Grubs

241,800

202,700

227,100

182,800

Gross Food Sales (millions)

$

642.5

$

508.0

$

2,353.6

$

1,787.4

GRUBHUB INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

December 31, 2015

December 31, 2014

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

169,293

$

201,796

Short term investments

141,448

111,341

Accounts receivable, less allowances for doubtful accounts

42,051

36,127

Prepaid expenses

3,482

2,940

Total current assets

356,274

352,204

PROPERTY AND EQUIPMENT:

Property and equipment, net of depreciation and amortization

19,082

16,003

OTHER ASSETS:

Other assets

3,105

3,543

Goodwill

396,220

352,788

Acquired intangible assets, net of amortization

285,567

254,339

Total other assets

684,892

610,670

TOTAL ASSETS

$

1,060,248

$

978,877

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

Restaurant food liability

$

64,326

$

91,575

Accounts payable

8,189

3,371

Accrued payroll

4,841

5,958

Taxes payable

426

1,660

Other accruals

11,830

8,441

Total current liabilities

89,612

111,005

LONG TERM LIABILITIES:

Deferred taxes, non-current

87,584

91,419

Other accruals

5,456

5,931

Total long term liabilities

93,040

97,350

Commitments and contingencies

STOCKHOLDERS' EQUITY:

Common stock, $0.0001 par value

8

8

Accumulated other comprehensive loss

(604)

(262)

Additional paid-in capital

759,292

689,953

Retained earnings

118,900

80,823

Total Stockholders' Equity

$

877,596

$

770,522

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

1,060,248

$

978,877

GRUBHUB INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Year Ended December 31,

2015

2014

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

38,077

$

24,263

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

Depreciation

5,085

5,032

Provision for doubtful accounts

850

426

Loss on disposal of fixed assets

11

Deferred taxes

(3,835)

4,612

Intangible asset amortization

22,949

17,655

Tenant allowance amortization

(159)

(159)

Stock-based compensation

13,450

9,393

Deferred rent

32

(17)

Investment premium amortization

688

315

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

Accounts receivable

(4,343)

(7,394)

Prepaid expenses and other assets

242

(1,669)

Restaurant food liability

(29,409)

13,414

Accounts payable

3,312

(259)

Accrued payroll

(2,104)

4,243

Other accruals

(80)

3,038

Net cash provided by operating activities

44,755

72,904

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of investments

(220,667)

(113,156)

Proceeds from maturity of investments

189,872

1,500

Capitalized website and development costs

(7,137)

(3,431)

Purchases of property and equipment

(4,150)

(3,653)

Acquisitions of businesses, net of cash acquired

(73,907)

Other cash flows from investing activities

(408)

Net cash used in investing activities

(116,397)

(118,740)

CASH FLOWS FROM FINANCING ACTIVITIES

Net proceeds from the issuance of common stock

142,541

Repurchases of common stock

(116)

Proceeds from exercise of stock options

11,919

8,322

Excess tax benefit related to stock-based compensation

27,830

12,975

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

(345)

(2,070)

Preferred stock tax distributions

(320)

Net cash provided by financing activities

39,404

161,332

Net change in cash and cash equivalents

(32,238)

115,496

Effect of exchange rates on cash

(265)

(242)

Cash and cash equivalents at beginning of year

201,796

86,542

Cash and cash equivalents at end of the period

$

169,293

$

201,796

SUPPLEMENTAL DISCLOSURE OF NON CASH ITEMS

Fair value of common stock issued for acquisitions

$

15,980

$

Cash paid for income taxes

1,326

NON-GAAP FINANCIAL MEASURES RECONCILIATION

(in thousands, except per share data)

Three Months Ended December 31,

Year Ended December 31,

2015

2014

2015

2014

Net income

$

11,288

$

10,765

$

38,077

$

24,263

Income taxes

4,351

5,508

23,852

20,721

Depreciation and amortization

6,657

5,809

28,034

22,687

EBITDA

22,296

22,082

89,963

67,671

Acquisition and restructuring costs

468

477

1,554

1,639

Stock-based compensation

4,072

2,412

13,450

9,393

Adjusted EBITDA

$

26,836

$

24,971

$

104,967

$

78,703

Three Months Ended December 31,

Year Ended December 31,

2015

2014

2015

2014

Net income

$

11,288

$

10,765

$

38,077

$

24,263

Stock-based compensation

4,072

2,412

13,450

9,393

Amortization of acquired intangible assets

4,774

3,526

18,236

14,102

Accelerated write-down of Seamless technology platform

1,897

Acquisition and restructuring costs

468

477

1,554

1,639

Income tax adjustments

(3,928)

(2,778)

(15,109)

(10,883)

Non-GAAP net income

$

16,674

$

14,402

$

58,105

$

38,514

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

86,028

84,311

85,706

81,698

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

$

0.19

$

0.17

$

0.68

$

0.47

 

SOURCE GrubHub Inc.



RELATED LINKS

http://www.grubhub.com