OpenTable, Inc. Announces Second Quarter Financial Results

-- Increases Revenue by 15% over Q2 2012 to $45.6 Million --

-- Grows Seated Diners by 26% over Q2 2012 --

-- Achieves EPS of $0.35 and Non-GAAP EPS of $0.50 --

Aug 01, 2013, 16:30 ET from OpenTable, Inc.

SAN FRANCISCO, Aug. 1, 2013 /PRNewswire/ -- OpenTable, Inc. (NASDAQ: OPEN), the world's leading provider of online restaurant reservations, today reported its financial results for the second quarter ended June 30, 2013.

(Logo: http://photos.prnewswire.com/prnh/20110606/MM07085LOGO )

OpenTable reported consolidated net revenues for Q2 2013 of $45.6 million, a 15% increase over Q2 2012. Consolidated net income for Q2 2013 was $8.3 million, or $0.35 per diluted share. Non-GAAP consolidated net income for Q2 2013, which excludes tax-affected stock-based compensation expense, tax-affected acquisition-related expenses and tax-affected amortization of acquired intangibles, was $12.0 million, or $0.50 per diluted share.

OpenTable provides operating results by geography as the Company is at different stages of development in its North America and International operations.

North America Results

  • Installed restaurant base as of June 30, 2013, totaled 20,588, a 12% increase over June 30, 2012.
  • Seated diners totaled 35.0 million, a 25% increase over Q2 2012.
  • Revenues totaled $39.7 million, a 15% increase over Q2 2012.
  • Non-GAAP adjusted EBITDA (earnings before interest, taxes, depreciation, amortization, stock-based compensation and acquisition-related expenses) totaled $21.2 million, or 53% of North America revenues, a 17% increase over Q2 2012.

International Results

  • Installed restaurant base as of June 30, 2013, totaled 7,686, a 15% increase over June 30, 2012.
  • Seated diners totaled 3.3 million, a 46% increase over Q2 2012.
  • Revenues totaled $5.8 million, a 15% increase over Q2 2012.
  • Non-GAAP adjusted EBITDA totaled a loss of $0.4 million compared to a loss of $0.8 million in Q2 2012.

"We're pleased with the strong growth in seated diners during the second quarter across both our North America and International business segments," said Matt Roberts, President and CEO of OpenTable. "With 38% of our seated diners now originating from smartphones and tablets, mobile remains a strategic focus for us and we're continuing to invest in mobile product optimization and adoption."

Q2 2013 Consolidated Financial and Operating Summary

  • Installed restaurant base as of June 30, 2013, totaled 28,274.
  • Seated diners totaled 38.2 million, a 26% increase over Q2 2012.
  • Total revenues were $45.6 million in Q2 2013, up 15% over Q2 2012 revenues of $39.6 million.
    • Reservation revenues were $27.7 million in Q2 2013, up 24% over Q2 2012 revenues of $22.3 million. Reservation revenues primarily increased as a result of the increase in seated diners and yield due to the change in the pricing of our promotional products from flat rate to a pay-for-performance model.
    • Subscription revenues were $15.1 million in Q2 2013, up 8% over Q2 2012 revenues of $13.9 million. Subscription revenues primarily increased as a result of the increase in installed restaurants using our Electronic Reservation Book solution.
    • Other revenues were $2.8 million in Q2 2013, down 15% over Q2 2012 revenues of $3.3 million. The decrease is primarily due to the change in the pricing of our promotional products from flat rate to a pay-for-performance model, which is now classified as Reservation revenues.
  • Total costs and expenses were $32.5 million in Q2 2013, up 6% over Q2 2012 costs and expenses of $30.7 million. The increase was driven by increases in marketing expense, facilities expense, and amortization of capitalized development, which is partially offset by a decrease in headcount related expenses.
  • Total operating income was $13.1 million in Q2 2013 compared to $8.9 million in Q2 2012. Non-GAAP consolidated operating income, excluding stock-based compensation expense, acquisition-related expenses and amortization of acquired intangibles, was $17.8 million in Q2 2013 compared to $15.2 million in Q2 2012.
  • The Q2 2013 GAAP income tax expense was $4.8 million, or a 36% tax rate.
  • Consolidated net income was $8.3 million, or $0.35 per diluted share, in Q2 2013 compared to $5.7 million, or $0.25 per diluted share, in Q2 2012. Non-GAAP consolidated net income, which excludes tax-affected stock-based compensation expense, tax-affected acquisition-related expenses, and tax-affected amortization of acquired intangibles, was $12.0 million, or $0.50 per diluted share, in Q2 2013 compared to $9.7 million, or $0.42 per diluted share, in Q2 2012.
  • As of June 30, 2013, OpenTable had cash and cash equivalents and short-term investments of $92.0 million.

"During the second quarter the business continued to deliver solid operating metrics, adjusted EBITDA margins and cash flows even as we invest for the future," said Duncan Robertson, CFO of OpenTable.

Business Outlook

As of today, OpenTable is providing guidance for Q3 2013 and the full year 2013 on revenue, non-GAAP adjusted EBITDA and other consolidated metrics. International segment guidance has been updated to reflect current foreign exchange rates.

Q3 2013 Guidance:

  • In the North America segment the Company estimates revenue to be in the range of $39.0 million to $39.9 million and non-GAAP adjusted EBITDA to be in the range of $18.3 million to $19.5 million.
  • In the International segment the Company estimates revenue to be in the range of $6.0 million to $6.4 million and non-GAAP adjusted EBITDA loss to be in the range of $0.6 million to $1.0 million.
  • On a consolidated basis the Company estimates revenue to be in the range of $45.0 million to $46.3 million, non-GAAP adjusted EBITDA to be in the range of $17.3 million to $18.9 million, GAAP EPS to be in the range of $0.21 to $0.25 and non-GAAP EPS to be in the range of $0.38 to $0.42.

Full Year 2013 Guidance:

  • In the North America segment the Company estimates revenue to be in the range of $160.6 million to $163.5 million and non-GAAP adjusted EBITDA to be in the range of $80.2 million to $83.6 million.
  • In the International segment the Company estimates revenue to be in the range of $25.6 million to $26.6 million and non-GAAP adjusted EBITDA loss to be in the range of $1.7 million to $2.8 million.
  • On a consolidated basis the Company estimates revenue to be in the range of $186.2 million to $190.1 million, non-GAAP adjusted EBITDA to be in the range of $77.4 million to $81.9 million, GAAP EPS to be in the range of $1.17 and $1.30 and non-GAAP EPS to be in the range of $1.80 to $1.92.

Quarterly Conference Call

A conference call will be webcast live today at 2 p.m. PT/5 p.m. ET and will be available through August 31, 2013, at http://investors.opentable.com/events.cfm. This call may contain forward-looking statements and other material information regarding the Company's financial and operating results.

About Non-GAAP Financial Information

This press release contains certain non-GAAP financial measures. Tables are provided in the press release that reconcile the non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP). The reconciliations of the forward-looking non-GAAP financial measures to the most directly comparable GAAP financial measures in the tables below include all information reasonably available to the Company at the date of this press release and adjustments that the Company can reasonably predict. Events that could cause the reconciliation to change include, but are not limited to, acquisitions and divestitures of businesses, goodwill and other asset impairments, and sales of available-for-sale debt securities and other investments.

The non-GAAP financial measures in this press release include non-GAAP consolidated net income and the related per diluted share amounts, non-GAAP consolidated operating income and non-GAAP adjusted EBITDA. Non-GAAP financial measure adjusted EBITDA is defined as earnings before interest, taxes, depreciation, amortization, stock-based compensation, and acquisition-related expenses. Within the Company's reconciliation to non-GAAP diluted net income per share, the impact of undistributed earnings allocated to participating securities has been excluded.

To supplement the Company's consolidated financial statements presented on a GAAP basis, management believes that these non-GAAP measures provide useful information about the Company's core operating results and thus are appropriate to enhance the overall understanding of the Company's past financial performance and its prospects for the future. Management believes it is useful to exclude stock-based compensation, acquisition-related expenses and amortization of acquired intangibles because they do not reflect the underlying performance of the Company's business operations. These adjustments to the Company's GAAP results are made with the intent of providing both management and investors a more complete understanding of the Company's underlying operational results and trends and performance. Management uses these non-GAAP measures to evaluate the Company's financial results. The presentation of non-GAAP measures is not meant to be considered in isolation or as a substitute for or superior to financial results determined in accordance with GAAP.

Background Information

The Company reports consolidated operations in U.S. dollars and operates in two geographic segments: North America and International. The North America segment is comprised of all operations in the United States, Canada and Mexico, and the International segment is comprised of all non-North America operations, which includes operations in Europe and Asia. The Company generates substantially all of its revenues from its restaurant customers. The Company's revenues primarily include monthly subscription fees, a fee for each restaurant guest seated through online reservations, and other revenue.

Forward-Looking Statements

This press release and its attachments contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks and uncertainties. These forward-looking statements include guidance for Q3 2013 and the full year 2013 and the quotations from management in this press release, as well as any statements regarding the Company's strategic and operational plans. The Company's actual results may differ materially from those anticipated in these forward-looking statements. Factors that may contribute to such differences include, among others, the Company's ability to accurately forecast revenues and expenses; worldwide economic conditions; the Company's ability to maintain an adequate rate of growth; the Company's ability to effectively manage its growth; the Company's ability to attract new restaurant customers; the Company's ability to increase the number of visitors to its websites and mobile applications and convert those visitors into diners; the Company's ability to retain existing restaurant customers and diners or encourage repeat reservations; the effects of increased competition; the Company's ability to successfully enter new markets and manage its international expansion; the impact of the fluctuations in currency exchange rates; the Company's ability to successfully manage any acquisitions of businesses, solutions or technologies; interruptions in service and any related impact on the Company's reputation; costs associated with defending intellectual property infringement and other claims; and the impact of natural catastrophic events. More information about potential factors that could affect the Company's business and financial results is contained in the Company's annual report on Form 10-K for the year ended December 31, 2012 and the Company's other filings with the SEC. The Company does not intend, and undertakes no duty, to update this information to reflect future events or circumstances.

About OpenTable, Inc.

OpenTable is the world's leading provider of online restaurant reservations, seating over 12 million diners per month via online bookings across approximately 28,000 restaurants. The OpenTable network connects restaurants and diners, helping diners discover and book the perfect table and helping restaurants deliver personalized hospitality to keep guests coming back. The OpenTable service enables diners to see which restaurants have available tables, select a restaurant based on verified diner reviews, menus and other helpful information, and easily book a reservation. In addition to the Company's website and mobile apps, OpenTable powers online reservations for nearly 600 partners, including many of the Internet's most popular global and local brands. For restaurants, the OpenTable hospitality solutions enable them to manage their reservation book, streamline their operations and enhance their service levels. Since its inception in 1998, OpenTable has seated more than 490 million diners around the world. The Company is headquartered in San Francisco, California, and the OpenTable service is available throughout the United States, as well as in Canada, Germany, Japan, Mexico and the UK. OpenTable also owns and operates toptable, the leading consumer destination site for restaurant reservations in the UK. More information is available on http://www.opentable.com.

OpenTable, OpenTable.com, OpenTable logos, toptable and other service names are the trademarks of OpenTable, Inc. and/or its affiliates.

OPENTABLE, INC.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

June 30,

December 31,

2013

2012

(In thousands)

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$ 80,883

$ 102,772

Short-term investments

11,087

733

Accounts receivable, net

23,604

22,015

Prepaid expenses and other current assets

5,079

2,924

Deferred tax asset

16,506

14,353

Total current assets

137,159

142,797

Property, equipment and software, net

28,436

21,271

Goodwill

59,850

46,304

Intangibles, net

17,830

15,226

Deferred tax asset

13,633

10,628

Other assets

941

1,021

TOTAL ASSETS

$ 257,849

$ 237,247

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable and accrued expenses

$ 11,100

$ 13,847

Accrued compensation

5,502

5,167

Deferred revenue

2,345

1,563

Deferred tax liability

315

107

Dining rewards payable

32,766

27,611

Total current liabilities

52,028

48,295

Deferred revenue — non-current

1,945

2,054

Deferred tax liability

4,186

3,268

Income tax liability

15,369

15,639

Other long-term liabilities

3,413

76

Total liabilities

76,941

69,332

STOCKHOLDERS' EQUITY:

Common stock

2

2

Additional paid-in capital

236,273

211,408

Treasury stock

(74,247)

(50,685)

Accumulated other comprehensive income (loss)

(2,906)

861

Retained earnings

21,786

6,329

Total stockholders' equity

180,908

167,915

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$ 257,849

$ 237,247

OPENTABLE, INC.

UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS

Three Months Ended

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

(In thousands, except per share amounts)

REVENUES

$ 45,565

$ 39,558

$ 91,066

$ 78,927

COSTS AND EXPENSES:

Operations and support (1)

11,458

10,338

22,821

20,858

Sales and marketing (1)

8,955

8,483

19,457

17,343

Technology (1)

4,611

3,610

9,111

6,858

General and administrative (1)

7,471

8,250

16,690

17,601

Total costs and expenses

32,495

30,681

68,079

62,660

Income from operations

13,070

8,877

22,987

16,267

Other income, net

(2)

13

11

30

Income before taxes

13,068

8,890

22,998

16,297

Income tax expense

4,752

3,145

7,541

5,736

NET INCOME

$ 8,316

$ 5,745

$ 15,457

$ 10,561

Net income per share:

Basic

$ 0.36

$ 0.25

$ 0.68

$ 0.47

Diluted

$ 0.35

$ 0.25

$ 0.65

$ 0.46

Weighted average shares outstanding:

Basic

22,826

22,578

22,882

22,557

Diluted

23,747

23,169

23,772

23,164

(1) Stock-based compensation included in above line items:

Operations and support

$ 223

$ 333

$ 246

$ 634

Sales and marketing

579

1,375

1,706

2,756

Technology

1,167

642

2,230

1,164

General and administrative

1,309

2,903

3,689

6,623

$ 3,278

$ 5,253

$ 7,871

$ 11,177

Other Operational Data:

Installed restaurants (at period end):

North America

20,588

18,373

20,588

18,373

International

7,686

6,664

7,686

6,664

Total

28,274

25,037

28,274

25,037

Seated diners (in thousands):

North America

34,955

28,038

69,223

55,754

International

3,271

2,244

6,359

4,498

Total

38,226

30,282

75,582

60,252

Headcount (at period end):

North America

415

418

415

418

International

159

161

159

161

Total

574

579

574

579

Additional Financial Data:

Revenues:

North America

Reservation

$ 23,752

$ 19,721

$ 47,244

$ 38,935

Subscription

13,298

12,265

26,188

24,165

Other

2,676

2,486

5,739

5,095

Total North America Revenues

$ 39,726

$ 34,472

$ 79,171

$ 68,195

International

Reservation

$ 3,933

$ 2,590

$ 7,498

$ 5,703

Subscription

1,755

1,662

3,547

3,302

Other

151

834

850

1,727

Total International Revenues

5,839

5,086

11,895

10,732

Total Revenues

$ 45,565

$ 39,558

$ 91,066

$ 78,927

Income (loss) from operations:

North America

$ 14,835

$ 11,374

$ 27,811

$ 21,354

International

(1,765)

(2,497)

(4,824)

(5,087)

Total

$ 13,070

$ 8,877

$ 22,987

$ 16,267

Depreciation and amortization:

North America

$ 3,136

$ 1,859

$ 5,685

$ 3,548

International

982

1,270

1,975

2,758

Total

$ 4,118

$ 3,129

$ 7,660

$ 6,306

Stock-based compensation:

North America

$ 2,903

$ 4,791

$ 7,110

$ 10,226

International

375

462

761

951

Total

$ 3,278

$ 5,253

$ 7,871

$ 11,177

OPENTABLE, INC.

RECONCILIATION OF GAAP TO NON-GAAP OPERATING RESULTS

Three Months Ended

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

(In thousands, except per share amounts)

Non-GAAP consolidated net income per share:

GAAP net income "as reported"

$ 8,316

$ 5,745

$ 15,457

$ 10,561

Add back: stock-based compensation expense

3,278

5,253

7,871

11,177

Income tax effect of stock-based compensation

(752)

(2,022)

(2,535)

(4,302)

Add back: acquisition-related expenses

327

51

417

51

Income tax effect of acquisition-related expenses

(123)

(19)

(157)

(19)

Add back: amortization of acquired intangibles

1,170

978

2,116

1,949

Income tax effect of amortization of intangibles

(254)

(259)

(524)

(515)

NON-GAAP CONSOLIDATED NET INCOME

$ 11,962

$ 9,727

$ 22,645

$ 18,902

Non-GAAP diluted net income per share

$ 0.50

$ 0.42

$ 0.95

$ 0.82

Weighted average diluted shares outstanding

23,747

23,169

23,772

23,164

Non-GAAP consolidated operating income:

GAAP operating income "as reported"

$ 13,070

$ 8,877

$ 22,987

$ 16,267

Add back: stock-based compensation expense

3,278

5,253

7,871

11,177

Add back: acquisition-related expenses

327

51

417

51

Add back: amortization of acquired intangibles

1,170

978

2,116

1,949

NON-GAAP OPERATING INCOME

$ 17,845

$ 15,159

$ 33,391

$ 29,444

North America Adjusted EBITDA:

GAAP operating income "as reported"

$ 14,835

$ 11,374

$ 27,811

$ 21,354

Adjustments:

Stock-based compensation expense

2,903

4,791

7,110

10,226

Acquisition-related expense

327

51

417

51

Amortization of acquired intangibles

814

88

1,400

176

Depreciation and other amortization expense

2,322

1,771

4,285

3,372

North America Adjusted EBITDA

$ 21,201

$ 18,075

$ 41,023

$ 35,179

International Adjusted EBITDA:

GAAP operating loss "as reported"

$ (1,765)

$ (2,497)

$ (4,824)

$ (5,087)

Adjustments:

Stock-based compensation expense

375

462

761

951

Amortization of acquired intangibles

356

890

716

1,773

Depreciation and other amortization expense

626

380

1,259

985

International Adjusted EBITDA

$ (408)

$ (765)

$ (2,088)

$ (1,378)

Consolidated Adjusted EBITDA:

GAAP operating income "as reported"

$ 13,070

$ 8,877

$ 22,987

$ 16,267

Adjustments:

Stock-based compensation expense

3,278

5,253

7,871

11,177

Acquisition-related expense

327

51

417

51

Amortization of acquired intangibles

1,170

978

2,116

1,949

Depreciation and other amortization expense

2,948

2,151

5,544

4,357

Consolidated Adjusted EBITDA

$ 20,793

$ 17,310

$ 38,935

$ 33,801

OPENTABLE, INC.

RECONCILIATION OF GAAP TO NON-GAAP FORWARD-LOOKING GUIDANCE

Forward-Looking Guidance

Three Months Ending

Twelve Months Ending

September 30, 2013

December 31, 2013

Range of Estimate

Range of Estimate

From

To

From

To

(In thousands, except per share amounts)

Non-GAAP consolidated net income per share:

GAAP net income

$ 5,019

$ 6,037

$ 28,131

$ 31,081

Add back: stock-based compensation expense

4,853

4,853

17,323

17,323

Income tax effect of stock-based compensation

(1,545)

(1,545)

(5,461)

(5,461)

Add back: acquisition-related expenses

-

-

417

417

Income tax effect of acquisition-related expenses

-

-

(126)

(126)

Add back: amortization of acquired intangibles

1,133

1,133

4,061

4,061

Income tax effect of amortization of intangibles

(377)

(377)

(1,224)

(1,224)

NON-GAAP CONSOLIDATED NET INCOME

$ 9,083

$ 10,101

$ 43,121

$ 46,071

GAAP diluted net income per share

$ 0.21

$ 0.25

$ 1.17

$ 1.30

Non-GAAP diluted net income per share

$ 0.38

$ 0.42

$ 1.80

$ 1.92

Weighted average diluted shares outstanding

23,800

23,800

24,000

24,000

North America Adjusted EBITDA:

GAAP operating income

$ 10,314

$ 11,514

$ 51,105

$ 54,505

Adjustments:

Stock-based compensation expense

4,431

4,431

15,631

15,631

Acquisition-related expense

-

-

417

417

Amortization of acquired intangibles

775

775

2,987

2,987

Depreciation and other amortization expense

2,780

2,780

10,060

10,060

North America Adjusted EBITDA

$ 18,300

$ 19,500

$ 80,200

$ 83,600

International Adjusted EBITDA:

GAAP operating loss

$ (2,452)

$ (2,052)

$ (8,275)

$ (7,175)

Adjustments:

Stock-based compensation expense

422

422

1,692

1,692

Amortization of acquired intangibles

358

358

1,074

1,074

Depreciation and other amortization expense

672

672

2,709

2,709

International Adjusted EBITDA

$ (1,000)

$ (600)

$ (2,800)

$ (1,700)

Consolidated Adjusted EBITDA:

GAAP operating income

$ 7,862

$ 9,462

$ 42,830

$ 47,330

Adjustments:

Stock-based compensation expense

4,853

4,853

17,323

17,323

Acquisition-related expense

-

-

417

417

Amortization of acquired intangibles

1,133

1,133

4,061

4,061

Depreciation and other amortization expense

3,452

3,452

12,769

12,769

Consolidated Adjusted EBITDA

$ 17,300

$ 18,900

$ 77,400

$ 81,900

SOURCE OpenTable, Inc.



RELATED LINKS

http://opentable.com