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Just Eat Takeaway.com to combine with Grubhub to create a leading global online food delivery player

Just Eat Takeaway.com N.V. (AMS: TKWY, LSE: JET), (the “Company” or “Just Eat Takeaway.com”), and Grubhub Inc. (NYSE: GRUB) (“Grubhub”) have entered into a definitive agreement whereby the Company is to acquire 100% of the shares of Grubhub in an all-stock transaction (the “Transaction”) to create the world’s largest online food delivery company outside of China, measured by Gross Merchandise Value (“GMV”) and revenues.

The Transaction represents Just Eat Takeaway.com’s entry into online food delivery in the United States (“U.S.”) and builds on the strategic rationale for its recent merger with Just Eat plc (“Just Eat”). A combined Just Eat Takeaway.com and Grubhub (the “Combined Group”) will become the world’s largest online food delivery company outside of China1, with strong brands connecting restaurant partners with their customers in 25 countries. The Combined Group will be built around four of the world’s largest profit pools in online food delivery: the U.S., the United Kingdom (“U.K.”), the Netherlands and Germany, increasing the Combined Group’s ability to deploy capital and resources to strengthen its competitive positions in all its markets. The Combined Group has strong leadership positions in almost all countries in which it is present and will become a significant player in North America. Just Eat Takeaway.com owns the leading Canadian business SkipTheDishes. The Combined Group is one of the few profitable players in the space and processed approximately 593 million orders in 2019 with more than 70 million combined active customers globally.

Key Terms
∙ Under the terms of the Transaction, Grubhub shareholders will be entitled to receive American depositary receipts (“ADRs”) representing 0.6710 Just Eat Takeaway.com ordinary shares in exchange for each Grubhub share, representing an implied value of $75.15 for each Grubhub share (based on the undisturbed closing price of Just Eat Takeaway.com on 9 June 2020 of €98.602) and implying a total equity consideration (on a fully diluted basis) of $7.3 billion.
∙ Immediately following completion of the Transaction, Grubhub shareholders are expected to own ADRs representing approximately 30.0% of the Combined Group (on a fully diluted basis).
∙ On completion, Matt Maloney, CEO and founder of Grubhub, will join the Just Eat Takeaway.com Management Board and will lead the Combined Group’s businesses across North America and two current Grubhub Directors will join the Just Eat Takeaway.com Supervisory Board.
∙ The Transaction is subject to the approval of both Just Eat Takeaway.com’s and Grubhub’s shareholders, as well as other customary completion conditions. Subject to satisfaction of the conditions, completion of the Transaction is anticipated to occur in the first quarter of 2021.
∙ The Combined Group will be headquartered and domiciled in Amsterdam, the Netherlands, with its North American headquarters in Chicago and a significant presence in the U.K..
∙ Just Eat Takeaway.com is listed on Euronext Amsterdam and the Main Market of the London Stock Exchange and will introduce an ADR listing in the U.S..

1 Measured by GMV and revenues.
2 Converted to USD from EUR at an exchange rate of 1.13585, the exchange rate at 17:30 CET / 16:30 BST on 9 June 2020.

Both the Managing Board and the Supervisory Board of Just Eat Takeaway.com and the Board of Directors of Grubhub are recommending the Transaction to their respective shareholders. Jitse Groen, CEO and founder of Just Eat Takeaway.com, has entered into a voting and support agreement, and subject to and in accordance with the terms thereof, has committed to vote in favour of the Transaction at the Just Eat Takeaway.com extraordinary general meeting (“EGM”).

Jitse Groen, CEO and founder of Just Eat Takeaway.com, said: “Matt and I are the two remaining food delivery veterans in the sector, having started our respective businesses at the turn of the century, albeit on two different continents. Both of us have a firm belief that only businesses with high-quality and profitable growth will sustain in our sector. I am excited that we can create the world’s largest food delivery business outside China. We look forward to welcoming Matt and his team to our company and working with them in the future.”

Matt Maloney, CEO and founder of Grubhub, commented: “When Grubhub and Seamless were founded, the online takeout industry didn’t exist in the U.S.. My vision was to transform the delivery and pick-up ordering experience. Like so many other entrepreneurs, we started modestly – restaurant by restaurant in our Chicago neighbourhood. Today, Grubhub is a leader across North America. I’ve known Jitse since 2007 and his story is much like mine. Combining the companies that started it all will mean that two trailblazing start-ups have become a clear global leader. We share a focus on a hybrid model that places extra value on volume at independent restaurants, driving profitable growth. Supported by Just Eat Takeaway.com, we intend to accelerate our mission to be the fastest, best and most rewarding way to order food from your favourite local restaurants in North America and around the world. We could not be more excited.”

Strategic Rationale
Just Eat Takeaway.com’s mission has consistently been focused on becoming the best food delivery company on the planet. Since its founding in 2000, Takeaway.com has chosen only to enter into markets in which it believes it can become a leader and be profitable. In fact, it is one of the rare examples of a profitable food delivery platform. The profits in the Netherlands helped secure a leadership position in Germany and other Continental European countries. The growth and profitability of the Takeaway.com businesses eventually allowed it to merge with Just Eat, another profitable European food delivery business. As a result, Just Eat Takeaway.com has leading positions in three of the world’s four largest profit pools for food delivery: the U.K., Germany and the Netherlands.

Just Eat Takeaway.com management believes that Grubhub is the best food delivery company in the U.S. and it is the only one which is culturally similar to Just Eat Takeaway.com. It has its origins in marketplace, and unlike most other food delivery companies, it has consistently been EBITDA positive. The competitive situation in the U.S. has changed over the past few years. In response, Grubhub successfully transformed its business into a hybrid model to meet the heightened competition. Just Eat Takeaway.com management believes that this is the right strategy. Success in the U.S. depends on deploying the right mix of logistics and marketplace region-by region, a balance Grubhub has achieved with profitable leading positions in key U.S. population centres. Despite this progress, the U.S. remains an underpenetrated market, with a tremendous TAM. It is nowhere near its end-state.

Grubhub as part of Just Eat Takeaway.com will become a much stronger business. Just Eat Takeaway.com owns SkipTheDishes, the clear leader in Canada. By building a North American leadership position, Just Eat Takeaway.com will be able to further strengthen both the Canadian and U.S. businesses. Just Eat Takeaway.com will prioritise sustainable growth over profits, as this has been a major driver of its strategy and success in Europe. Grubhub has leading positions in a number of large U.S. cities, including New York. Just Eat Takeaway.com intends to invest in expanding these leading positions.

While in spirit Just Eat Takeaway.com is the same company as at the beginning of last year, in size it is not. Just Eat Takeaway.com has become one of the world’s largest food delivery companies. The latter also means that its main competitors are no longer from Europe. They are large international operators. This transaction significantly strengthens its global competitive position.

Transaction Highlights
∙ Creates the world’s largest food delivery company, outside of China, measured by GMV and revenue.
∙ The Company is one of the few profitable players at scale in the space.
∙ Creates a company built around four of the world’s largest profit pools in food delivery: the U.S., the U.K., the Netherlands and Germany. These markets show substantial further opportunities for growth, significant penetration upside and longer-term profitability improvements.
∙ Grubhub will be much stronger as part of Just Eat Takeaway.com. The combination with Just Eat Takeaway.com’s Canadian business, SkipTheDishes, as well as the increased scale and resources of the Combined Group will provide greater flexibility to make strategic, long-term investment decisions.
∙ In the U.S., where the market is competitive and fragmented across local regions and cities, Grubhub’s differentiated offering provides it with unique advantages given its large marketplace business, its Seamless corporate business, its large geographic footprint and extensive customer and restaurant relationships.
∙ The enhanced scale and leading positions of the Combined Group provide an opportunity to leverage best practices from Just Eat Takeaway.com and Grubhub and create the broadest possible offering to both restaurant partners and consumers. The Combined Group will have a greater ability to leverage investments, in particular in technology, marketing and restaurant delivery services across the combined business.
∙ The Combined Group will have a founder-led management team with a proven track record of building leading positions in markets of scale. The new management team has 55+ years of combined experience in the sector.

Current Trading Update

∙ Strong accelerated growth with order growth up +41% in April and May 2020
∙ In the Company’s most important markets, the trading momentum witnessed in late-March continued into April and May with order growth in the U.K. of +33%, the Netherlands +38%, and Germany +48%. In Canada, order growth was particularly strong with +97%.
∙ Almost all of the markets most significantly affected by the COVID-19 crisis have now recovered to above pre-crisis order levels.
∙ Just Eat Takeaway.com provided substantial financial and operational relief to its restaurant partners across its markets. A range of local initiatives, worth millions of Euros, were provided to healthcare workers, including free meals delivered to hospitals and country-wide discounts for healthcare workers and their families.

∙ Grubhub Gross Food Sales, which is the primary driver of revenue, was +59% in April and May compared to April and May of last year.
∙ Grubhub demonstrated broad strength across older markets and new. New York continues to rebound from March lows, with consumer volume above pre-COVID-19 levels.
∙ Robust growth trends have sustained throughout May and into June. Average order size remains high.
∙ Grubhub has seen an increase in activity from return diners and high quality new diners. Diner retention is meaningfully higher than prior quarters.
∙ Grubhub continues to support local restaurants with over $100 million to help them through the pandemic, including deferring commissions, substantial diner promotions, contactless delivery and investments in the company’s driver network to maintain a high level of service and safety.

3 Aggregated German orders, including pre-acquisition.

Overview of Grubhub and the Combined Group

Description of Grubhub
∙ Grubhub is a leading online and mobile food-ordering and delivery marketplace in the U.S., with nearly 300,000 restaurants across 4,000 U.S. cities.
∙ The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages.
∙ For the 2019 financial year, Grubhub had 23 million active customers, recorded 180 million orders, GMV of $5.9 billion and revenues of $1.3 billion.

Integration Planning
∙ Just Eat Takeaway.com highly respects the Grubhub management team and, following the completion of the Transaction, Matt Maloney will lead the Combined Group’s businesses in North America, including Canada.
∙ Grubhub will continue to be headquartered in Chicago, U.S.
∙ Upon completion of the Transaction, the Combined Group will initiate a programme to plan for integration, based on bringing together both companies’ experience of integrating acquisitions to minimise disruption to restaurants and consumers, whilst delivering the expected opportunities and benefits of the Transaction for the Combined Group’s stakeholders.
∙ The integration of Just Eat’s business is progressing well and is not expected to be affected by the acquisition of Grubhub. As one of the first major milestones, in the first week of June 2020, Just Eat’s market leading Swiss business was migrated to Just Eat Takeaway.com’s central European IT platform and the teams are working through further steps in the broader integration process.

4 Just Eat Takeaway.com figures based on unaudited financials. Grubhub financials prepared in accordance with US GAAP, Just Eat Takeaway.com prepared in accordance with IFRS.
5 Converted from USD to EUR at exchange rate of 0.9000.
6 Just Eat Takeaway.com figures pro forma for the Just Eat/Takeaway.com combination.

Key Terms of the Merger Agreement
On 10 June 2020, Just Eat Takeaway.com entered into an Agreement and Plan of Merger (the “Merger Agreement”), by and among Just Eat Takeaway.com, Grubhub, Checkers Merger Sub I, Inc. (“Merger Sub I”), a Delaware corporation and a wholly-owned subsidiary of Just Eat Takeaway.com, and Checkers Merger Sub II, Inc. (“Merger Sub II”), a Delaware corporation and a wholly-owned subsidiary of Just Eat Takeaway.com, providing for the acquisition by Just Eat Takeaway.com of all of the issued and outstanding shares of common stock of Grubhub.

At the effective time of the Transaction, on the terms and subject to the conditions set forth in the Merger Agreement, each share of common stock of Grubhub will be converted into the right to receive ADRs representing 0.6710 Just Eat Takeaway.com ordinary shares, without interest.

Consummation of the Transaction is subject to customary closing conditions, including (i) the required approval of the Merger Agreement by the shareholders of Just Eat Takeaway.com and Grubhub; (ii) completion of any review by U.S. and U.K. antitrust authorities and the Committee on Foreign Investment in the United States (CFIUS); (iii) the absence of any order prohibiting the Transaction; (iv) the accuracy of the representations and warranties of the parties and compliance by the parties with their respective obligations under the Merger Agreement (subject to customary materiality qualifiers); (v) the absence of any material adverse effect on Just Eat Takeaway.com or Grubhub since the date of the Merger Agreement; and (vi) approval of listing of the Just Eat Takeaway.com ADRs to be issued as the merger consideration on a U.S. stock exchange.

Just Eat Takeaway.com and Grubhub have each made customary representations and warranties and covenants in the Merger Agreement. Among other things, each of Just Eat Takeaway.com and Grubhub may not solicit or participate in discussions with third parties regarding alternative acquisition proposals, subject to exceptions that allow each of Just Eat Takeaway.com and Grubhub under certain circumstances to provide information to and participate in discussions with third parties with respect to unsolicited alternative acquisition proposals. In addition, until the termination of the Merger Agreement or the effective time of the Transaction, each of Just Eat Takeaway.com and Grubhub has agreed to use reasonable best efforts to operate its business in the ordinary course of business in all material respects and has agreed to certain other negative covenants. The Merger Agreement contains certain termination rights for Just Eat Takeaway.com and Grubhub. Upon termination of the Merger Agreement under specified circumstances, including if Just Eat Takeaway.com or Grubhub terminates the Merger Agreement in order to accept an alternative acquisition proposal that constitutes a superior proposal or if the board of one party changes its recommendation of the transaction, Just Eat Takeaway.com or Grubhub, as applicable, will be required to pay the other party a termination fee of $144 million.

The foregoing description of the Merger Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Merger Agreement.

Information on Just Eat Takeaway.com
Just Eat Takeaway.com (AMS: TKWY, LSE: JET) is a leading global online food delivery marketplace outside China. Headquartered in Amsterdam, the Company is focused on connecting consumers and restaurants through its platforms. With over 155,000 connected restaurants, Just Eat Takeaway.com offers consumers a wide variety of food choice. Just Eat Takeaway.com mainly collaborates with delivery restaurants. In addition, Just Eat Takeaway.com provides its proprietary restaurant delivery services for restaurants that do not deliver themselves. The combination of Just Eat and Takeaway.com has rapidly grown to become a leading online food delivery marketplace with operations in the U.K., the Netherlands, Germany, Denmark, France, Ireland, Italy, Norway, Spain, Belgium, Poland, Austria, Israel, Switzerland, Luxembourg, Portugal, Bulgaria, Romania, Australia, New Zealand, Canada, Mexico and Brazil. In the financial year ended 31 December 2019 and prior to the completion of the merger with Just Eat, the Company generated revenues of €416 million, loss before tax of €88 million and as at 31 December 2019 had gross assets of €1,659 million.

Information on Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as nearly 24 million active diners. Dedicated to connecting diners with the food they love from their favourite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features nearly 300,000 restaurants and is proud to partner with more than 200,000 of these restaurants in over 4,000 U.S. cities. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages. In the financial year ended 31 December 2019, Grubhub generated revenues of $1,312 million, loss before tax of $26.8 million and as at 31 December 2019 had gross assets of $2,375 million.

Next Steps, Conditions and Timeline
The size of the Transaction means that it is classed as a Class 1 transaction under the UK Listing Rules. Accordingly, and also pursuant to Dutch law, the Transaction is conditional upon, among other matters, the approval of the Transaction by the Company’s shareholders. An EGM will be convened in due course for the Company’s shareholders to consider and, if thought fit, approve the Transaction. The resolution to be put to shareholders at the EGM will be set out in a Class 1 circular and convocation of the EGM. The Class 1 circular and the convocation of the EGM will be made available on the corporate website of Just Eat Takeaway.com (https://corporate.takeaway.com) in advance of the EGM. The EGM is expected to take place in the second half of 2020. The Transaction is also subject to Grubhub shareholder approval. The Transaction is anticipated to complete in the first quarter of 2021.

Conference Call and Webcast Details
Jitse Groen, Matt Maloney, Brent Wissink and Jörg Gerbig will host an analyst and investor conference call to discuss the Transaction at 14:00 CEST / 13:00 BST / 08:00 EDT on 11 June 2020. Information on how to access the live audio webcast can be found at https://corporate.takeaway.com and https://investors.grubhub.com. The recorded audio webcast (together with the accompanying slides) will be made available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on Just Eat Takeaway.com’s and Grubhub’s websites.

Just Eat Takeaway.com

Jitse Groen, CEO
Brent Wissink, CFO
Jörg Gerbig, COO

Investors:
Joris Wilton
E: Joris.Wilton@takeaway.com
T: +31 6 143 154 79

Media:
Charles Armitstead / Ben Foster (London) +44 (0) 7703 330 269 / +44 (0) 7776 240 806
Katherine Kim (New York) +1 917 455 4102
E: takeaway@teneo.com
For more information please visit the Company’s corporate website: https://corporate.takeaway.com
This press release contains inside information as meant in clause 7(1) of the Market Abuse Regulation.

BofA Securities
(Joint financial adviser and corporate broker to Just Eat Takeaway.com)
Ference Lamp
Peter Luck
Ric Spencer
Kieran Millar

Goldman Sachs International (Joint financial adviser and corporate broker to Just Eat Takeaway.com)
Clif Marriott
Barry O’Brien
Nick Harper
Duncan Stewart

Grubhub
Matt Maloney, Founder and CEO
Adam DeWitt, President and CFO
+44 (0) 20 7628 1000 +44 (0) 20 7774 1000

Investors:
Adam Patnaude
E: ir@grubhub.com
Media:
E: press@grubhub.com or Joele Frank, Wilkinson Brimmer Katcher Eric Brielmann, Kelly Sullivan +1 212 355 4

Evercore (Lead financial adviser to Grubhub) +1 212 857 3100
Zaheed Kajani
Naveen Nataraj
Bill Anderson

Centerview Partners (Financial adviser to Grubhub) +1 212 380 2650
Blair Effron
David Hess
Tyler Brooke

Cravath, Swaine & Moore LLP, De Brauw Blackstone Westbroek N.V. and Slaughter and May are retained as legal advisers to Just Eat Takeaway.com. Kirkland and Ellis LLP, Wilson Sonsini Goodrich & Rosati and NautaDutilh N.V. are retained as legal advisers to Grubhub.

Important Notice Relating to Financial Advisers
Bank of America Merrill Lynch International DAC, Amsterdam Branch (“BofA Securities”), a subsidiary of Bank of America Corporation, is acting exclusively for Just Eat Takeaway.com in connection with the Transaction and for no one else and will not be responsible to anyone other than Just Eat Takeaway.com for providing the protections afforded to its clients or for providing advice in relation to the Transaction.

Goldman Sachs International, which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority in the United Kingdom, is acting exclusively for Just Eat Takeaway.com and no one else in connection the Transaction and will not be responsible to anyone other than Just Eat Takeaway.com for providing the protections afforded to clients of Goldman Sachs International, or for providing advice in connection with the Transaction.

Forward Looking Statements
This release contains “forward-looking statements” regarding Grubhub, Just Eat Takeaway.com or their respective management’s future expectations, beliefs, intentions, goals, strategies, plans and prospects, which, in the case of Grubhub, are made in reliance on the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve substantial risks, known and unknown, uncertainties, assumptions and other factors that may cause actual results, performance or achievements to differ materially from future results expressed or implied by such forward-looking statements including, but not limited to, the occurrence of any event, change or other circumstances that could give rise to the right of one or both of Grubhub or Just Eat Takeaway.com to terminate the merger agreement; the ability to obtain regulatory approvals and meet other closing conditions to the proposed merger on a timely basis or at all, including the risk that regulatory approvals required for the proposed merger are not obtained on a timely basis or at all or are obtained subject to conditions that are not anticipated or that could adversely affect the combined company or the expected benefits of the proposed merger; the ability to obtain approval by Grubhub stockholders and Just Eat Takeaway.com shareholders on the expected schedule or at all; difficulties and delays in integrating Grubhub’s and Just Eat Takeaway.com’s businesses; risks that the proposed merger disrupts Grubhub’s or Just Eat Takeaway.com’s current plans and operations; failing to fully realize anticipated synergies, cost savings and other anticipated benefits of the proposed merger when expected or at all; potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed merger; the risk that unexpected costs will be incurred; the ability of Grubhub or Just Eat Takeaway.com to retain and hire key personnel; the diversion of management’s attention from ongoing business operations; uncertainty as to the value of the Just Eat Takeaway.com ordinary shares to be issued in connection with the proposed merger; uncertainty as to the long-term value of the common stock of the combined company following the proposed merger; the continued availability of capital and financing following the proposed merger; the outcome of any legal proceedings that may be instituted against Grubhub, Just Eat Takeaway.com or their respective directors and officers; changes in global, political, economic, business, competitive, market and regulatory forces; changes in tax laws, regulations, rates and policies; future business acquisitions or disposals; competitive developments; and the timing and occurrence (or non-occurrence) of other events or circumstances that may be beyond Grubhub’s and Just Eat Takeaway.com’s control. These and other risks, uncertainties, assumptions and other factors may be amplified or made more uncertain by the COVID-19 pandemic, which has caused significant economic uncertainty. The extent to which the COVID-19 pandemic impacts Grubhub’s and Just Eat Takeaway.com’s businesses, operations and financial results, including the duration and magnitude of such effects, will depend on numerous factors, which are unpredictable, including, but not limited to, the duration and spread of the outbreak, its severity, the actions taken to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. Forward-looking statements generally relate to future events or Grubhub and Just Eat Takeaway.com’s future financial or operating performance and include, without limitation, statements relating to the proposed merger and the potential impact of the COVID-19 outbreak on Grubhub and Just Eat Takeaway.com’s business and operations. In some cases, you can identify forward-looking statements because they contain words such as “anticipates,” “believes,” “contemplates,” “could,” “seeks,” “estimates,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and the negatives of those terms.

While forward-looking statements are Grubhub’s and Just Eat Takeaway.com’s current predictions at the time they are made, you should not rely upon them. Forward-looking statements represent Grubhub’s and Just Eat Takeaway.com’s management’s beliefs and assumptions only as of the date of this release, unless otherwise indicated, and there is no implication that the information contained in this release is made subsequent to such date. For additional information concerning factors that could cause actual results and outcomes to differ materially from those expressed or implied in the forward-looking statements, please refer to the cautionary statements and risk factors included in Grubhub’s filings with the Securities and Exchange Commission (the “SEC”), including Grubhub’s Annual Report on Form 10-K filed with the SEC on February 28, 2020, Grubhub’s Quarterly Reports on Form 10-Q and any further disclosures Grubhub makes in Current Reports on Form 8-K. Grubhub’s SEC filings are available electronically on Grubhub’s investor website at investors.grubhub.com or the SEC’s website at www.sec.gov. For additional information concerning factors that could cause future results to differ from those expressed or implied in the forward-looking statements, please refer to Just Eat Takeaway.com’s non-exhaustive list of key risks and cautionary statements included in Just Eat Takeaway.com’s Annual Report, which is available electronically on Just Eat Takeaway.com’s investor website at www.corporate.takeaway.com. Except as required by law, Grubhub and Just Eat Takeaway.com assume no obligation to update these forward-looking statements or this release, or to update, supplement or correct the information set forth in this release or the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. All subsequent written and oral forward-looking statements attributable to Grubhub, Just Eat Takeaway.com or any person acting on behalf of either party are expressly qualified in their entirety by the cautionary statements referenced above.

Additional Information and Where to Find It
In connection with the proposed merger, Just Eat Takeaway.com will file with the SEC a registration statement on Form F-4 to register the shares to be issued in connection with the proposed merger. The registration statement will include a preliminary proxy statement of Grubhub/prospectus of Just Eat Takeaway.com which, when finalized, will be sent to the stockholders of Grubhub seeking their approval of the respective merger related proposals. Also in connection with the proposed merger, Just Eat Takeaway.com will file with the Netherlands Authority for the Financial Markets (“AFM”) and/or the UK Financial Conduct Authority (“FCA”) a prospectus for the listing and admission to trading on Euronext Amsterdam and/or the admission to listing on the FCA’s Official List and to trading on the London Stock Exchange’s Main Market for listed securities of the shares to be issued in connection with the proposed merger (the “Prospectus”). INVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT ON FORM F-4 AND THE RELATED PROXY STATEMENT/PROSPECTUS INCLUDED WITHIN THE REGISTRATION STATEMENT ON FORM F-4, THE PROSPECTUS, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS FILED OR TO BE FILED WITH THE SEC, THE AFM AND/OR THE FCA IN CONNECTION WITH THE PROPOSED MERGER, WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT GRUBHUB, JUST EAT TAKEAWAY.COM AND THE PROPOSED MERGER.

Investors and security holders may obtain copies of these documents and any other documents filed with or furnished to the SEC by Grubhub or Just Eat Takeaway.com free of charge through the website maintained by the SEC at www.sec.gov, from Grubhub at its website, investors.grubhub.com, or from Just Eat Takeaway.com at its website www.corporate.takeaway.com. The Prospectus, as well as any supplement thereto, will be made available on the website of Just Eat Takeaway.com at its website www.corporate.takeaway.com

Participants in the Solicitation
Grubhub, Just Eat Takeaway.com and their respective directors and certain of their respective executive officers and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed merger under the rules of the SEC. Information about Grubhub’s directors and executive officers is available in Grubhub’s proxy statement dated April 9, 2020 for its 2020 Annual Meeting of Stockholders. To the extent holdings of Grubhub securities by directors or executive officers of Grubhub have changed since the amounts contained in the definitive proxy statement for Grubhub’s 2020 Annual Meeting of Stockholders, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. These documents are available free of charge from the sources indicated above, and from Grubhub by going to its investor relations page on its corporate website at investors.grubhub.com. Information about Just Eat Takeaway.com’s directors and executive officers and a description of their interests are set forth in Just Eat Takeaway.com’s 2019 Annual Report, which may be obtained free of charge from Just Eat Takeaway.com’s website, www.corporate.takeaway.com. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus and other relevant materials to be filed with the SEC regarding the proposed merger when they become available. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions. You may obtain free copies of these documents from Grubhub or Just Eat Takeaway.com using the sources indicated above.

No Offer or Solicitation

This communication shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended and applicable United Kingdom, Dutch and other European regulations.

The contents of the websites referred to in this Announcement are not incorporated into and do not form part of this Announcement.

Grubhub Reports First Quarter 2020 Results

Grubhub generates 12% revenue growth in the first quarter

CHICAGO, May 6, 2020 /PRNewswire/ — Grubhub Inc. (NYSE: GRUB), a leading online and mobile food-ordering and delivery marketplace, today announced financial results for the first quarter ended March 31, 2020 and also posted a letter to shareholders on its investor relations website. The Company reported revenues of $363 million, which is a 12% year-over-year increase from $324 million in the same period last year. Gross Food Sales grew 8% year-over-year to $1.6 billion, up from $1.5 billion in the same period last year.

“The restaurant industry is facing enormous challenges in light of the difficult, but necessary, steps taken to keep us safe as we fight COVID-19,” said Matt Maloney, Grubhub founder and CEO. “Grubhub is using nearly all of our profits in the second quarter to generate as many additional orders for our restaurant partners as possible. We hope that the darkest days are behind our restaurant partners and they can start focusing on the recovery.”

First Quarter 2020 Highlights
The following results reflect the financial performance and key operating metrics of our business for the three months ended March 31, 2020, as compared to the same period in 2019.

First Quarter Financial Highlights

  • Revenues: $363.0 million, a 12% year-over-year increase from $323.8 million in the first quarter of 2019.
  • Net Income (Loss): $(33.4) million, or $(0.36) per diluted share, a decrease from $6.9 million, or $0.07 per diluted share, in the first quarter of 2019.
  • Non-GAAP Adjusted EBITDA: $21.0 million, a 59% year-over-year decrease from $50.9 million in the first quarter of 2019.
  • Non-GAAP Net Income (Loss): $(37) thousand, or $(0.00) per diluted share, a decrease from $27.9 million, or $0.30 per diluted share, in the first quarter of 2019.

First Quarter Key Business Metrics Highlights1

  • Active Diners: 23.9 million, a 24% year-over-year increase from 19.3 million Active Diners in the first quarter of 2019.
  • Daily Average Grubs (DAGs): 516,300, a 1% year-over-year decrease from 521,000 DAGs in the first quarter of 2019.
  • Gross Food Sales: $1.6 billion, an 8% year-over-year increase from $1.5 billion in the first quarter of 2019.

“COVID-19 has driven a significant uptick in new diners and orders from existing users as most restaurant dining rooms have been temporarily closed nationwide,” said Adam DeWitt, Grubhub president and CFO. “At current volume trends, we could be generating meaningful Adjusted EBITDA in the second quarter. But as Matt highlighted, we believe the absolute best use of our cash is to support our restaurants, their employees, our drivers and the entire takeout ecosystem through this crisis, by generating as many orders as possible while funding extra safety measures for restaurants, drivers and diners. We hope that these additional sales help make a difference to our partners in this time of crisis.”

Second Quarter 2020 Guidance
Based on information available as of May 6, 2020, the Company is providing the following financial guidance for the second quarter of 2020.

Second Quarter 2020

(in millions)

Expected Adjusted EBITDA

$5

First Quarter 2020 Financial Results Conference Call
Grubhub will webcast a conference call tomorrow at 8:00 a.m. CT to discuss the first quarter 2020 financial results. The webcast can be accessed on the Grubhub Investor Relations website at https://investors.grubhub.com, along with the Company’s letter to shareholders, earnings press release and financial tables. A replay of the webcast will be available on the same website.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as nearly 24 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 300,000 restaurants and is proud to partner with more than 200,000 of these restaurants in over 4,000 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, 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, which are made in reliance on the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve substantial risks, known and unknown, uncertainties, assumptions and other factors that may cause actual results, performance or achievements including, but not limited to, achievement of the benefits of our planned additional investments, to differ materially from future results expressed or implied by such forward-looking statements. Forward-looking statements generally relate to future events or our future financial or operating performance and include, without limitation, statements relating to the potential impact of the COVID-19 outbreak on our business and operations. In some cases, you can identify forward-looking statements because they contain words such as “anticipates,” “believes,” “contemplates,” “could,” “seeks,” “estimates,” “intends,” “may,” “plans,” “potential,” “predicts,” “projects,” “should,” “will,” “would” or similar expressions and the negatives of those terms. While forward-looking statements are our best prediction at the time they are made, you should not rely upon them. Forward-looking statements represent our management’s beliefs and assumptions only as of May 6, 2020, unless otherwise indicated, and there is no implication that the information contained in this press release is made subsequent to such date. For additional information concerning factors that could affect our financial results or cause actual results to differ materially from those expressed or implied in the forward-looking statements, please refer to the cautionary statements included in our filings with the Securities and Exchange Commission (the “SEC”), including the “Risk Factors” section of our Annual Report on Form 10-K filed with the SEC on February 28, 2020 and our Quarterly Reports on Form 10-Q and any further disclosures we make in our Current Reports on Form 8-K. Our SEC filings are available electronically on our investor website at investors.grubhub.com or the SEC’s website at www.sec.gov. Except as required by law, we assume no obligation to update these forward-looking statements or this press release, or to update, supplement or correct the information set forth in the press release or 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 (loss) and non-GAAP net income (loss) 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 (loss) 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 (loss) and non-GAAP net income (loss) 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 (loss) and non-GAAP net income (loss) 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 (loss) to Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP net income (loss) per diluted share attributable to common stockholders.

1 Key Business Metrics are defined on pages 28 – 29 of our Annual Report on Form 10-K filed on February 28, 2020.

GRUBHUB INC.

STATEMENTS OF OPERATIONS

(in thousands, except per share data)

Three Months Ended
March 31,

2020

2019

Revenues

$

362,980

$

323,770

Costs and expenses:

Operations and support

214,561

161,350

Sales and marketing

90,742

78,454

Technology (exclusive of amortization)

31,273

27,250

General and administrative

38,949

22,787

Depreciation and amortization

33,363

25,089

Total costs and expenses

408,888

314,930

Income (loss) from operations

(45,908)

8,840

Interest expense – net

6,380

2,812

Income (loss) before provision for income taxes

(52,288)

6,028

Income tax benefit

(18,861)

(862)

Net income (loss) attributable to common stockholders

$

(33,427)

$

6,890

Net income (loss) per share attributable to common stockholders:

Basic

$

(0.36)

$

0.08

Diluted

$

(0.36)

$

0.07

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

Basic

91,793

90,951

Diluted

91,793

92,918

 

KEY BUSINESS METRICS

Three Months Ended
March 31,

2020

2019

Active Diners (000s)

23,892

19,286

Daily Average Grubs

516,300

521,000

Gross Food Sales (millions)

$

1,630

$

1,502

 

GRUBHUB INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

March 31, 2020

December 31,   2019

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

560,708

$

375,909

Short-term investments

36,359

49,275

Accounts receivable, less allowances for doubtful accounts

135,661

119,658

Income tax receivable

20,271

3,960

Prepaid expenses and other current assets

18,051

17,515

Total current assets

771,050

566,317

PROPERTY AND EQUIPMENT:

Property and equipment, net of depreciation and amortization

189,050

172,744

OTHER ASSETS:

Other assets

32,154

26,836

Operating lease right-of-use asset

101,758

100,632

Goodwill

1,007,968

1,007,968

Acquired intangible assets, net of amortization

487,797

500,481

Total other assets

1,629,677

1,635,917

TOTAL ASSETS

$

2,589,777

$

2,374,978

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Restaurant food liability

$

152,551

$

131,753

Accounts payable

29,317

26,748

Accrued payroll

24,255

19,982

Current operating lease liability

11,999

9,376

Other accruals

87,438

61,504

Total current liabilities

305,560

249,363

LONG-TERM LIABILITIES:

Deferred taxes, non-current

24,438

27,163

Noncurrent operating lease liability

112,863

111,056

Long-term debt

668,242

493,009

Other accruals

817

817

Total long-term liabilities

806,360

632,045

STOCKHOLDERS’ EQUITY:

Common stock, $0.0001 par value

9

9

Accumulated other comprehensive loss

(2,271)

(1,628)

Additional paid-in capital

1,182,757

1,164,400

Retained earnings

297,362

330,789

Total Stockholders’ Equity

$

1,477,857

$

1,493,570

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

2,589,777

$

2,374,978

 

GRUBHUB INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Three Months Ended
March 31,

2020

2019

CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss)

$

(33,427)

$

6,890

Adjustments to reconcile net income (loss) to net cash from operating activities:

Depreciation

8,658

6,193

Amortization of intangible assets and developed software

24,705

18,896

Stock-based compensation

20,185

16,478

Deferred taxes

(2,725)

(986)

Other

3,479

735

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

Accounts receivable

(18,333)

(30,391)

Income taxes receivable

(16,311)

(916)

Prepaid expenses and other assets

(4,602)

(10,666)

Restaurant food liability

20,857

13,099

Accounts payable

4,678

(18,644)

Accrued payroll

4,277

411

Other accruals

26,085

12,845

Net cash provided by operating activities

37,526

13,944

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of investments

(19,790)

(12,160)

Proceeds from maturity of investments

32,900

11,636

Capitalized website and development costs

(14,243)

(10,692)

Purchases of property and equipment

(19,678)

(8,018)

Acquisition of other intangible assets

(510)

(5,379)

Acquisitions of businesses, net of cash acquired

—

127

Other cash flows from investing activities

(250)

—

Net cash used in investing activities

(21,571)

(24,486)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from borrowings under the credit facility

175,000

—

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

(8,051)

(9,966)

Proceeds from exercise of stock options

1,414

2,424

Repayments of borrowings under the credit facility

—

(2,031)

Payments for debt issuance costs

—

(1,647)

Net cash provided by (used in) financing activities

168,363

(11,220)

Net change in cash, cash equivalents, and restricted cash

184,318

(21,762)

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

(600)

232

Cash, cash equivalents, and restricted cash at beginning of year

379,594

215,802

Cash, cash equivalents, and restricted cash at end of the period

$

563,312

$

194,272

SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS

Cash paid for income taxes

$

—

$

351

 

GRUBHUB INC.

NON-GAAP FINANCIAL MEASURES RECONCILIATION

(in thousands, except per share and per order data)

Three Months Ended
March 31,

2020

2019

Net income (loss)

$

(33,427)

$

6,890

Income taxes

(18,861)

(862)

Interest expense – net

6,380

2,812

Depreciation and amortization

33,363

25,089

EBITDA

(12,545)

33,929

Acquisition, restructuring and certain legal costs

13,376

486

Stock-based compensation

20,185

16,478

Adjusted EBITDA

$

21,016

$

50,893

Net income (loss) per order

$

(0.71)

$

0.15

Adjusted EBITDA per order

$

0.45

$

1.09

Three Months Ended
March 31,

2020

2019

Net income (loss)

$

(33,427)

$

6,890

Stock-based compensation

20,185

16,478

Amortization of acquired intangible assets

12,685

11,942

Acquisition, restructuring and certain legal costs

13,376

486

Income tax adjustments

(12,856)

(7,862)

Non-GAAP income (loss)

$

(37)

$

27,934

Weighted-average diluted shares used to compute income (loss) per share attributable to common stockholders

91,793

92,918

Non-GAAP income (loss) per diluted share attributable to common stockholders

$

(0.00)

$

0.30

Guidance

Three Months Ended
June 30, 2020

(in millions)

Net loss

$

(42)

Income taxes

(16)

Interest expense – net

7

Depreciation and amortization

34

EBITDA

(17)

Acquisition, restructuring and certain legal costs

—

Stock-based compensation

22

Adjusted EBITDA

$

5

 

Grubhub Provides Business Update And Timing Of First Quarter 2020 Earnings Announcement

CHICAGO, April 13, 2020 /PRNewswire/ — Grubhub Inc. (NYSE: GRUB), a leading online and mobile food-ordering and delivery marketplace, today announced it will release first quarter 2020 earnings results after the market close on Wednesday, May 6, 2020, followed by a conference call to discuss its results on Thursday, May 7, 2020, at 8:00 a.m. CT.

The company also today provided a brief business update due to the extraordinary circumstances stemming from the COVID-19 pandemic.

Business Update

During these unprecedented times, our priority is the health, safety and sustainability of our community – the drivers, restaurants and diners who make up our marketplace and our approximately 2,800 Grubhub employees. We have responded quickly to the crisis by launching a number of initiatives to support restaurants, drivers and diners; our focus is on driving as much business as we can to our restaurant partners while dining rooms remain closed.  And we will continue to support the local communities and restaurants that are struggling during this uncertain and difficult period.

For the first quarter of 2020, we expect our revenue and adjusted EBITDA to be slightly above the midpoints of the guidance we issued on February 5, 2020. While the business was trending at or above the high end of our guidance range for the first 10 weeks of the quarter, like most businesses, we experienced a swift change in customer behavior in the middle of March when the pandemic took hold across the country.

Initially, we observed a decrease in orders across our entire business as the news upended typical routines and there was considerable uncertainty about what day-to-day life would be like. In particular, our corporate business, which accounted for a mid-single digit percentage of our orders in the fourth quarter, was dramatically impacted in mid-March as virtually all of our corporate clients shifted to work-from-home models.

In New York City our consumer business was affected more than in other metro areas due to the severity of the COVID-19 impact in that market. We believe this is due to a number of factors, including New York City residents choosing to temporarily leave the city and/or cooking at home more often, as well as more local restaurants deciding to pause operations because of the temporary drop in demand. As a result of all of these factors, our first quarter DAGs ended up flattish compared to the first quarter of 2019.

Exiting the first quarter and in the beginning of the second quarter, we have seen trends improve significantly – so far in April our overall year-over-year DAG growth has been approximately 10%. In markets less affected by the outbreak, diner ordering has returned to, and in many cases exceeded, our pre-COVID-19 expectations. We are also seeing record numbers of new diners and new restaurants on the platform. In markets more affected, New York in particular, we have seen a stabilization in consumer orders, and even some improvement from the low points observed in March, but New York orders remain below pre-COVID volumes. We will discuss these dynamics in more detail during earnings, but we believe what we are now observing on both the positive and negative side, including corporate, is ephemeral, and we expect to see a return to more typical behavior when the COVID-19 impact on daily life wanes.

In this difficult and uncertain environment, we believe Grubhub has a clear responsibility to help restaurants and all working individuals in our ecosystem. We further believe the absolute best way we can support our industry is by driving as much demand as possible to local restaurants, which in turn has significant downstream benefits for restaurant workers, restaurant suppliers, our drivers and countless others in the value chain.

While we are confident we could generate meaningful profits in the second quarter that would keep us comfortably on the previously announced path to deliver at least $100 million of Adjusted EBITDA in 2020, we are instead planning to reinvest most of the profits we expect to generate during the second quarter into programs that directly drive more business to our restaurant partners. We anticipate this enhanced support will take several forms, including numerous Grubhub-funded diner promotions, reduced or eliminated diner delivery fees, platform improvements and products and procedures to help keep drivers, diners and restaurant workers safe.

As a result, we plan to intentionally manage the business to approximately $5 million of Adjusted EBITDA in the second quarter to continue to support our ecosystem. To be clear, this is a completely discretionary short-term business decision designed to support our industry. We are proud that our consistent profitability, highly variable cost structure and strong balance sheet afford us ample liquidity (approximately $600 million as of March 31, including $175 million we added from our revolver) and flexibility during times like these.

We are confident that our ability to manage our business profitably while competing aggressively has not changed, but because of the uncertainty surrounding the timing of when and how the COVID-19 outbreak will resolve, we believe it’s prudent to withdraw our full year 2020 revenue and EBITDA guidance.

When business and social conditions normalize, we expect to return Grubhub to the growth and profit trajectory we were on before COVID-19 – which was at the high end of our expectations laid out over the last couple of quarters. We remain bullish on our industry and our long-term competitive strategy.

Stay safe, and we look forward to providing you with a more comprehensive update on the business in early May.

Matt Maloney, Founder and CEO
Adam DeWitt, President and CFO

First Quarter Earnings Call
Grubhub will release first quarter 2020 earnings results after the market close on Wednesday, May 6, 2020, followed by a conference call to discuss its results on Thursday, May 7, 2020, at 8:00 a.m. CT.  Founder & CEO Matt Maloney and President & CFO Adam DeWitt will host the conference call.

The live webcast of the conference call will be available on the investor relations section of the Grubhub website at http://investors.grubhub.com. Following completion of the call, a recording of the webcast will be available on the website.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as more than 22 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 350,000 restaurants and is proud to partner with more than 165,000 of these restaurants in over 3,200 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, 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 including, but not limited to, achievement of the benefits of our planned additional investments, 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, statements related to the potential impact of the COVID-19 outbreak on our business and operations, as well as 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, 2020, which is on file with the SEC and are available on the Investor Relations section of our website at https://investors.grubhub.com. 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 is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States, or GAAP.

We define Adjusted EBITDA as net income (loss) adjusted to exclude acquisition, restructuring and certain legal costs, income taxes, net interest expense, depreciation and amortization and stock-based compensation expense. We use 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 is not a measurement of our financial performance under GAAP and should not be considered as an alternative to performance measures derived in accordance with GAAP.

Grubhub CEO letter to President Trump in support of independent restaurants

The Honorable Donald J. Trump
President
The White House
1600 Pennsylvania Ave, NW
Washington, DC 20500

The Honorable Nancy Pelosi
Speaker of the House of Representatives
United States Capitol
Washington, DC 20515

The Honorable Mitch McConnell
Majority Leader
United States Senate
Washington, DC 20510

Dear Mr. President, Speaker Pelosi, and Majority Leader McConnell:

Grubhub is the leading online and mobile food-ordering and delivery marketplace with the largest network of restaurant partners in the United States, as well as more than 22 million active diners. With over 100,000 SMB restaurant partnerships across the country, we are proud of our ability to help drive local revenue by connecting diners with the food they love from their favorite local restaurants.

During this unprecedented time in our country, restaurants are on the front lines of the struggle to continue to feed Americans. Since the crisis began, Grubhub has been working with state and local officials around the country to support our local independent restaurant community and lend support for efforts to keep the doors open to our restaurants for delivery and take-out.  And while we applaud our government leaders and their efforts to minimize the COVID-19 impact and keep the American people safe, we know that without these release valves of delivery and pickup, many of our nation’s independent restaurants will not survive.

To provide our independent restaurants some relief, Grubhub has launched an aid package which includes deferred payments for our independent restaurants providing much needed cash flow relief until this crisis is over. We have also established the Grubhub Community Relief Fund which will pay cash grants to organizations supporting independent restaurants and food delivery drivers.

However, we know that the needs of the restaurant industry during this unprecedented time are beyond our control. The National Restaurant Association anticipates sales to decline by $225 billion during the next three months alone, which could prompt the loss of between five and seven million jobs. I am calling on you to support the $325 billion aid package proposed by the NRA which would establish a much needed industry recovery fund, provide for business interruption insurance, as well as much needed loan and tax relief. Specifically, the proposal would authorize the following:

  • The Department of Treasury to create a $145 billion Restaurant and Foodservice Industry Recovery Fund.
  • $35 billion for Community Development Block Grants for Disaster Relief (CDBGDR) assistance.
  • $100 billion in Federally-Backed Business Interruption Insurance
  • $45 billion in expanded access to effective, efficient and affordable federal and conventional loans.
  • $130 million in Disaster Unemployment Assistance (DUA)

If enacted, these measures would ensure that restaurants have the necessary liquidity and access to critical financing to help them survive the dramatic loss in profits caused by COVID-19.

Restaurants are the heart and soul of our communities and we must do everything we can to get them through this time of incredible uncertainty.

Thank you for your leadership.

Sincerely,

Matt Maloney

Founder and CEO

 

cc:  Honorable Steven Mnuchin, Secretary of the Treasury
Honorable Chuck Schumer, Senate Democratic Leader
Honorable Kevin McCarthy, House Republican Leader
Honorable Mark Warner, U.S. Senate

Grubhub and Major Cities Across the U.S. Launch Economic Relief Effort up to $100 Million for Independent Restaurants and Delivery Partners Impacted by COVID-19

Mayors of Chicago, New York City, San Francisco, Boston and Portland Team with Grubhub to Suspend Fees from Independent Restaurants
Grubhub Sets up Charitable Fund for Impacted Drivers and Restaurants

CHICAGO, March 13, 2020 /PRNewswire/ — In collaboration with the mayors of large cities across the United States who are on the front lines of the COVID-19 response efforts, Grubhub today announced it is temporarily suspending collection of up to $100 million in commission payments from impacted independent restaurants nationwide.

Grubhub’s initiative will provide immediate and substantial cash flowrelief to qualified independent restaurants — restaurants that make up the majority of Grubhub’s 350,000+ restaurant community and drive more than 80 percent of the company’s orders.

Matt Maloney, Grubhub Founder and CEO said: “Independent restaurants are the lifeblood of our cities and feed our communities. They have been amazing long-term partners for us, and we wanted to help them in their time of need. Our business is their business — so this was an easy decision for us to make.”

Grubhub has also created a fund that will enable proceeds from its Donate the Change program to go toward charitable organizations that support restaurants and drivers impacted by the COVID-19 health crisis. The program will allow diners to round up the change from every order and donate it to the Grubhub Community Relief Fund — with donations from Grubhub+ (and Seamless+) members matched by the company. Grubhub has been raising more than $1 million dollars per month through Donate the Change.

Grubhub will work with local city officials to identify the organizations that can utilize the funds and to consider other support programs during the pandemic.

“The City of Chicago is deeply concerned about the risk COVID-19 is placing on the health of our residents and communities, as well as the impact it’s having on our working families and neighborhood economies and restaurants,” said Chicago Mayor Lori E. Lightfoot. “That is why we applaud corporate leaders like Grubhub who are stepping up with practical measures to support small businesses and their employees. Now more than ever, we must work together to ensure hardworking Chicagoans receive the support they need to thrive while also staying safe, secure, and healthy.”

In Chicago, where Grubhub was founded in 2004 and is headquartered today, there are more than 10,000 restaurants on the platform, and thousands of drivers bringing delicious food from these restaurants to hungry diners. This relief fund will provide support for food industry workers, which are anticipated to become among some of the most impacted by the economic losses due to coronavirus and social distancing practices. This includes residents at small, neighborhood-based businesses like Chicago’s Home of Chicken & Waffles, based in Bronzeville.

As dine-in traffic is expected to slow up to 75 percent over the next few weeks, restaurants will rely on pickup and delivery orders to stay in business. “We have seen revenue decrease in the past week as a direct result of our customers staying home,” said Darnell Johnson, owner of Chicago’s Home of Chicken & Waffles. “Grubhub has helped us generate more delivery and takeout orders as our customers’ dining habits have changed. This has helped us continue serving our loyal customers and our employees can continue living a sustainable lifestyle.”

“Banding together during hard times, putting people over profit, and supporting our local businesses is a model we should all follow, and I thank Grubhub for leading the way,” said New York City Mayor Bill de Blasio.

“Restaurants are a pillar of the San Francisco small business economy and so important to the culture of this city,” said Joaquin Torres, Director of San Francisco’s Office of Economic and Workforce Development. “We are committed to doing everything in our power to support them in this time of crisis, but if we want to come through this public health emergency intact, we’ll need more private sector partners to follow Grubhub’s lead, do the right thing and invest locally to mitigate this crisis.”

These initiatives follow a series of measures taken by Grubhub to keep restaurants, diners, and drivers safe during the outbreak – including contact-free delivery and health and safety guidance to drivers, restaurants and diners. Additionally, Grubhub offers pickup from the largest restaurant network in the country, which helps individuals who might feel safer acquiring food on their own.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as more than 22 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 350,000 restaurants and is proud to partner with more than 165,000 of these restaurants in over 3,200 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages.

Grubhub Kicks Off Third Year Of RestaurantHER, Continuing Support For Women In The Restaurant Industry

Funded by the more than $1 million raised by diners during 2019 RestaurantHER, James Beard Foundation announces new platform for women in leadership

CHICAGO, March 10, 2020 /PRNewswire/ — Grubhub, the nation’s leading pickup and delivery marketplace with the largest restaurant network, is continuing its commitment in supporting women-led restaurants during the third year of its RestaurantHER initiative.

Last year Grubhub diners donated more than $1 million to the James Beard Foundation’s women’s initiatives, and in 2020 the organization is putting those funds to work. With the assistance of Grubhub, the James Beard Foundation will be launching a new digital platform to provide women in the industry with accessible resources, substantially broadening its impact beyond the nearly 400 women the program now supports annually. The platform will provide educational guides on financing and best practices for business planning, as well as opportunities for members to network and connect with potential mentors through local community meet-ups and relevant industry events. Grubhub will also continue supporting local restaurant communities through RestaurantHER, encouraging diners to order from the growing, first-of-its-kind map of women-led restaurants, which now features nearly 50,000 restaurants.

“Thanks to partnerships with leaders like Grubhub, we’ve been able to make a positive impact in supporting women-led restaurants in the industry,” said Clare Reichenbach, CEO of the James Beard Foundation. “We’ve seen women executive chefs grow in representation within the industry, and although we have a long way to go to achieve gender parity, we’re certainly heading in the right direction.”

“Having access to tangible resources like the James Beard Foundation’s programming is invaluable, and extending these to even more women with support from Grubhub is very exciting. The organization’s ‘Owning It’ workshop was incredibly impactful, giving us the opportunity to network and connect with other women in the industry and provided real tools to help define, shape, and better our business,” said Valerie Zweig, co-founder of Prescription Chicken. “From writing down the vision for our companies to hearing from and interacting with varied industry experts and even doing a live pitch to a panel of investors, we left with practical tools that we have already started implementing into our business.”

Since its inception in 2018, RestaurantHER has helped raise awareness about the long-standing issues impacting women in today’s restaurant industry. In a partnership with Women Chefs & Restaurateurs (WCR), Grubhub supported the development of “Sharpen Your Skills,” a toolkit for aspiring female chefs and culinary leaders to help women navigate and address the challenges they face in the restaurant industry. Additionally, Grubhub contributed to WCR’s scholarship and mentorship programs, assisting and connecting over a dozen women in the culinary industry through formal apprenticeships.

“We’re proud to continue our efforts to drive change in the restaurant industry. Gender equality is important to us, and it’s important to our diners, too,” said Jessica Burns, Vice President of Brand Marketing and Creative at Grubhub. “While there’s still progress to be made, women now make up 22% of all chefs and head cooks, a rise from just over 19% in 2017. At the end of the day, we have a responsibility to raise awareness and give a voice to women in today’s industry, and with partners like the James Beard Foundation we’re able to do just that.”

For more information on Grubhub’s RestaurantHER initiative or to check out the map of women-led restaurants, visit RestaurantHER.com. To find out more about the James Beard Foundation’s women’s initiatives, visit JamesBeard.org.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as more than 22 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 300,000 restaurants and is proud to partner with more than 155,000 of these restaurants in over 3,200 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages.

 

Grubhub Launches Industry Leading Membership Program With Unrivaled Rewards & Exclusive Benefits

– Grubhub+ offers unlimited free delivery, 10% Cashback, Elite Care and donation matching
– Company doubles down on diner rewards after doubling restaurant network

CHICAGO, Feb. 26, 2020 /PRNewswire/ — Grubhub, the nation’s leading pickup and delivery marketplace with the largest restaurant network, today launched Grubhub+, a new membership program loaded with rewards (Seamless+ also available). Grubhub+ goes above and beyond other subscription programs with member benefits like 10% Cashback and donation matching to high impact organizations like No Kid Hungry.

Grubhub+ membership features industry leading benefits at launch, including:

  • Unlimited free delivery: from Grubhub+ restaurants, including many popular brands
  • Unlimited 10% Cashback: on dollars spent on Grubhub+ restaurants – Grubhub+ literally pays for itself if you order more than $100 in food per month
  • Double donations: donation matching on Donate the Change for Grubhub+ orders, to drive twice the impact for worthy charities
  • VIP access: access to Elite Care teams for priority assistance
  • First dibs: exclusive access to new Perks, local events, and experiences

Currently anyone can sign up for a free 14-day trial and experience how easy and valuable the program is, and for a limited time, diners participating in any other food delivery subscription program can receive an extended 30-day free trial to compare for themselves. Additionally, all students enrolled in any of the 150+ campuses that work with Grubhub will receive Grubhub+ for free!

“Whether they’re trying us out for the first time or order many times a week, diners already love our exclusive Perks,” said Sam Hall, Grubhub’s Chief Product Officer. “Now with Grubhub+, we’re excited to dramatically expand rewards while doubling our charitable impact and assisting with our elite support teams. We’ve pulled out all the stops for this program.”

“Generous diner rewards are at the core of Grubhub’s competitive strategy. As the only profitable company in our space, we are leveraging our profits to stay laser-focused on having the most restaurants in the network and giving away as much free food as possible,” said Matt Maloney, Grubhub founder and CEO. “With the most restaurants and the best loyalty programs, we believe that we have the right formula and are ideally positioned for success.”

After more than $200 million dollars in rewards were redeemed by diners across Grubhub platforms in 2019, Grubhub+ is a continuation of Grubhub’s strategy to offer the most rewards in the industry. Last year Grubhub launched Perks, a treasure-trove of exclusive deals and savings along with new ways to earn and redeem restaurant loyalty rewards. Grubhub+ is a natural extension of Perks with free delivery and 10% Cashback.

Grubhub+ includes additional benefits like access to Elite Care, special menus, and events. The program also helps diners to do more for their communities because Grubhub will match member donations made with orders placed at Grubhub+ restaurants through our industry leading Donate the Change feature. Over the past year Grubhub diners have donated more than $10 million to No Kid Hungry by simply rounding up and donating their change, and now Grubhub will match subscribers’ donations, giving members the opportunity to double their impact.

“Grubhub diners have shown significant interest in supporting their local communities. With their help, we made dramatic progress toward ending childhood hunger in the United States – but we still have a long way to go,” said Billy Shore, Founder and Executive Chair of Share Our Strength. “By matching subscribers’ donations, Grubhub is doubling down on their commitment to help us provide children with more meals. Grubhub+ members are doing twice as much good simply by joining the program and opting to donate their change.”

For more information on all benefits or to sign up for Grubhub+, go to www.grubhub.com/plus.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as more than 22 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 300,000 restaurants and is proud to partner with more than 155,000 of these restaurants in over 3,200 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, AllMenus and MenuPages.

Grubhub Reports Fourth Quarter And Full Year 2019 Results

Grubhub generates 19% revenue growth in the fourth quarter

CHICAGO, Feb. 5, 2020 /PRNewswire/ — Grubhub Inc. (NYSE: GRUB), a leading online and mobile food-ordering and delivery marketplace, today announced financial results for the fourth quarter and full year ended December 31, 2019 and also posted a letter to shareholders on its investor relations website. For the fourth quarter, the Company reported revenues of $341 million, which is a 19% year-over-year increase from $288 million in the same period last year. Gross Food Sales grew 13% year-over-year to $1.6 billion, up from $1.4 billion in the fourth quarter of 2018.

“We strengthened both sides of our marketplace during the fourth quarter, adding 1.4 million active diners and more than doubling our restaurant selection from just a quarter ago,” said Matt Maloney, Grubhub founder and CEO. “We are making good progress on the key initiatives we outlined last quarter. We added more than 15,000 partnered and over 150,000 non-partnered restaurant options for our diners and we also launched a number of new loyalty programs for our restaurant partners.”

Fourth Quarter and Full Year 2019 Highlights
The following results reflect the financial performance and key operating metrics of our business for the three and twelve months ended December 31, 2019, as compared to the same periods in 2018.

Fourth Quarter Financial Highlights

  • Revenues: $341.3 million, a 19% year-over-year increase from $287.7 million in the fourth quarter of 2018.
  • Net Income (Loss): $(27.7) million, or $(0.30) per diluted share, a decrease from $(5.2) million, or $(0.06) per diluted share, in the fourth quarter of 2018.
  • Non-GAAP Adjusted EBITDA: $26.7 million, a 37% year-over-year decrease from $42.1 million in the fourth quarter of 2018.
  • Non-GAAP Net Income (Loss): $(4.2) million, or $(0.05) per diluted share, a decrease from $17.6 million, or $0.19 per diluted share, in the fourth quarter of 2018.

Fourth Quarter Key Business Metrics Highlights1

  • Active Diners: 22.6 million, a 28% year-over-year increase from 17.7 million Active Diners in the fourth quarter of 2018.
  • Daily Average Grubs (DAGs): 502,600, a 8% year-over-year increase from 467,500 DAGs in the fourth quarter of 2018.
  • Gross Food Sales: $1.6 billion, a 13% year-over-year increase from $1.4 billion in the fourth quarter of 2018.
1 Key Business Metrics are defined on page 29 of our Annual Report on Form 10-K filed on February 28, 2019.

Full Year Financial Highlights

  • Revenues: $1.3 billion, a 30% year-over-year increase from $1.0 billion in 2018.
  • Net Income (Loss): $(18.6) million, or $(0.20) per diluted share, a decrease from $78.5 million, or $0.85 per diluted share, in 2018.
  • Non-GAAP Adjusted EBITDA: $186.2 million, a 20% year-over-year decrease from $233.7 million in 2018.
  • Non-GAAP Net Income: $73.2 million, or $0.79 per diluted share, a 52% decrease from $153.3 million, or $1.66 per diluted share, in 2018.

Full Year Key Business Metrics Highlights1

  • Active Diners: 22.6 million, a 28% year-over-year increase from 17.7 million Active Diners in 2018.
  • Daily Average Grubs (DAGs): 492,300, a 13% year-over-year increase from 435,900 DAGs in 2018.
  • Gross Food Sales: $5.9 billion, a 17% year-over-year increase from $5.1 billion in 2018.

“We continue to innovate the online takeout industry with our recent launch of Grubhub Ultimate, a revolutionary, first-of-its-kind proprietary hardware and software solution that integrates all restaurant ordering channels into one system. Grubhub Ultimate is an important step in helping unlock the pickup market, which accounts for the majority of the more than $250 billion takeout industry,” said Adam DeWitt, Grubhub president and CFO. “We remain confident our overall strategy will deliver sustainable value for all of our stakeholders and the team is determined to continue to execute and build on the early wins.”

First Quarter and Full Year 2020 Guidance
Based on information available as of February 5, 2020, the Company is providing the following financial guidance for the first quarter and full year of 2020.

First Quarter 2020

Full Year 2020

(in millions)

Expected Revenue

$350 – $370

$1,400 – $1,500

Expected Adjusted EBITDA

$15 – $25

at least $100

Fourth Quarter 2019 Financial Results Conference Call
Grubhub will webcast a conference call tomorrow at 8:00 a.m. CT to discuss the fourth 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 letter to shareholders, earnings press release and financial tables. A replay of the webcast will be available at the same website.

About Grubhub
Grubhub (NYSE: GRUB) is a leading online and mobile food-ordering and delivery marketplace with the largest and most comprehensive network of restaurant partners, as well as more than 22 million active diners. Dedicated to connecting diners with the food they love from their favorite local restaurants, Grubhub elevates food ordering through innovative restaurant technology, easy-to-use platforms and an improved delivery experience. Grubhub features over 300,000 restaurants and is proud to partner with more than 155,000 of these restaurants in over 3,200 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, 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 including, but not limited to, achievement of the benefits of our planned additional investments, 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 and our most recent Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, which are on file with the SEC and are available on the Investor Relations section of our website at https://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, 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.

GRUBHUB INC.

STATEMENTS OF OPERATIONS

(in thousands, except per share data)

Three Months Ended
December 31,

Year Ended
December 31,

2019

2018

2019

2018

Revenues

$

341,270

$

287,721

$

1,312,151

$

1,007,257

Costs and expenses:

Operations and support

190,328

144,082

675,471

454,321

Sales and marketing

86,100

69,877

310,299

214,290

Technology (exclusive of amortization)

29,164

24,972

115,297

82,278

General and administrative

28,018

27,393

101,918

85,465

Depreciation and amortization

32,488

24,153

115,449

85,940

Total costs and expenses

366,098

290,477

1,318,434

922,294

Income (loss) from operations

(24,828)

(2,756)

(6,283)

84,963

Interest expense – net

6,189

2,163

20,493

3,530

Income (loss) before provision for income taxes

(31,017)

(4,919)

(26,776)

81,433

Income tax (benefit) expense

(3,299)

231

(8,210)

2,952

Net income (loss) attributable to common stockholders

$

(27,718)

$

(5,150)

$

(18,566)

$

78,481

Net income (loss) per share attributable to common stockholders:

Basic

$

(0.30)

$

(0.06)

$

(0.20)

$

0.88

Diluted

$

(0.30)

$

(0.06)

$

(0.20)

$

0.85

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

Basic

91,509

90,705

91,247

89,447

Diluted

91,509

90,705

91,247

92,354

KEY BUSINESS METRICS

Three Months Ended
December 31,

Year Ended
December 31,

2019

2018

2019

2018

Active Diners (000s)

22,621

17,688

22,621

17,688

Daily Average Grubs

502,600

467,500

492,300

435,900

Gross Food Sales (millions)

$

1,552

$

1,377

$

5,914

$

5,057

 

GRUBHUB INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

December 31,
2019

December   31,
2018

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$

375,909

$

211,245

Short-term investments

49,275

14,084

Accounts receivable, less allowances for doubtful accounts

119,658

110,855

Income tax receivable

3,960

9,949

Prepaid expenses and other current assets

17,515

17,642

Total current assets

566,317

363,775

PROPERTY AND EQUIPMENT:

Property and equipment, net of depreciation and amortization

172,744

119,495

OTHER ASSETS:

Other assets

26,836

14,186

Operating lease right-of-use asset

100,632

—

Goodwill

1,007,968

1,019,239

Acquired intangible assets, net of amortization

500,481

549,013

Total other assets

1,635,917

1,582,438

TOTAL ASSETS

$

2,374,978

$

2,065,708

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Restaurant food liability

$

131,753

$

127,344

Accounts payable

26,748

26,656

Accrued payroll

19,982

18,173

Current portion of long-term debt

—

6,250

Current operating lease liability

9,376

—

Other accruals

61,504

44,745

Total current liabilities

249,363

223,168

LONG-TERM LIABILITIES:

Deferred taxes, non-current

27,163

46,383

Noncurrent operating lease liability

111,056

—

Long-term debt

493,009

335,548

Other accruals

817

18,270

Total long-term liabilities

632,045

400,201

STOCKHOLDERS’ EQUITY:

Common stock, $0.0001 par value

9

9

Accumulated other comprehensive loss

(1,628)

(1,891)

Additional paid-in capital

1,164,400

1,094,866

Retained earnings

330,789

349,355

Total Stockholders’ Equity

$

1,493,570

$

1,442,339

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

$

2,374,978

$

2,065,708

 

GRUBHUB INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

Year Ended December 31,

2019

2018

CASH FLOWS FROM OPERATING ACTIVITIES

Net income (loss)

$

(18,566)

$

78,481

Adjustments to reconcile net income (loss) to net cash from operating activities:

Depreciation

30,237

21,647

Amortization of intangible assets and developed software

85,212

64,293

Stock-based compensation

72,879

55,261

Deferred taxes

(7,726)

1,724

Other

8,531

5,552

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

Accounts receivable

(11,591)

(6,092)

Income taxes receivable

5,989

(1,356)

Prepaid expenses and other assets

(13,854)

(16,270)

Restaurant food liability

4,380

2,921

Accounts payable

1,978

11,160

Accrued payroll

1,804

3,621

Other accruals

23,349

4,585

Net cash provided by operating activities

182,622

225,527

CASH FLOWS FROM INVESTING ACTIVITIES

Purchases of investments

(85,989)

(57,197)

Proceeds from maturity of investments

51,366

67,166

Capitalized website and development costs

(48,524)

(31,180)

Purchases of property and equipment

(55,167)

(43,033)

Acquisition of other intangible assets

(9,980)

(11,851)

Acquisitions of businesses, net of cash acquired

127

(517,909)

Other cash flows from investing activities

(250)

—

Net cash used in investing activities

(148,417)

(594,004)

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from the issuance of long-term debt

500,000

222,000

Repayments of borrowings under the credit facility

(342,313)

(53,906)

Proceeds from the issuance of common stock

—

200,000

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

(23,753)

(35,599)

Proceeds from exercise of stock options

4,469

14,190

Payments for debt issuance costs

(9,136)

—

Net cash provided by financing activities

129,267

346,685

Net change in cash, cash equivalents, and restricted cash

163,472

(21,792)

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

320

(645)

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

$

379,594

$

215,802

SUPPLEMENTAL DISCLOSURE OF NON-CASH ITEMS

Cash paid for income taxes

$

1,163

$

7,895

 

GRUBHUB INC.

NON-GAAP FINANCIAL MEASURES RECONCILIATION

(in thousands, except per share and per order data)

Three Months Ended
December 31,

Year Ended
December 31,

2019

2018

2019

2018

Net income (loss)

$

(27,718)

$

(5,150)

$

(18,566)

$

78,481

Income taxes

(3,299)

231

(8,210)

2,952

Interest expense – net

6,189

2,163

20,493

3,530

Depreciation and amortization

32,488

24,153

115,449

85,940

EBITDA

7,660

21,397

109,166

170,903

Acquisition, restructuring and legal costs

966

1,913

4,105

7,578

Stock-based compensation2

18,073

18,816

72,879

55,261

Adjusted EBITDA

$

26,699

$

42,126

$

186,150

$

233,742

Net income (loss) per order

$

(0.60)

$

(0.12)

$

(0.10)

$

0.49

Adjusted EBITDA per order

$

0.58

$

0.98

$

1.04

$

1.47

Three Months Ended
December 31,

Year Ended
December 31,

2019

2018

2019

2018

Net income (loss)

$

(27,718)

$

(5,150)

$

(18,566)

$

78,481

Stock-based compensation2

18,073

18,816

72,879

55,261

Amortization of acquired intangible assets

13,367

11,377

50,712

42,484

Acquisition, restructuring and legal costs

966

1,913

4,105

7,578

Income tax adjustments

(8,916)

(9,384)

(35,883)

(30,544)

Non-GAAP net income (loss)

$

(4,228)

$

17,572

$

73,247

$

153,260

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

91,509

93,144

92,759

92,354

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

$

(0.05)

$

0.19

$

0.79

$

1.66

2 Stock-based compensation expense for the three months ended December 31, 2018 and the twelve months ended December 31, 2019 and 2018 included $4.8 million, $1.6 million and $4.8 million, respectively, of expense related to the accelerated vesting of equity awards to certain terminated acquired employees.

 

Guidance

Three Months Ended

 March 31, 2020

Low

High

(in millions)

Net loss

$

(36.0)

$

(28.5)

Income taxes

(12.1)

(9.6)

Interest expense – net

6.1

6.1

Depreciation and amortization

34.0

34.0

EBITDA

(8.0)

2.0

Acquisition, restructuring and legal costs

—

—

Stock-based compensation

23.0

23.0

Adjusted EBITDA

$

15.0

$

25.0

Note: For the full year 2020, we currently expect Adjusted EBITDA of at least $100 million, net interest expense of $25 million, depreciation and amortization expense of $145 million and stock-based compensation expense of $100 million. 

Grubhub Launches Ultimate Technology For Restaurants To Address $250+ Billion U.S. Takeout Market

– Diners to enjoy order transparency and time savings –
– Restaurants to see increased order volume, revenue and staff efficiency –

CHICAGO, Jan. 23, 2020 /PRNewswire/ — Grubhub, the nation’s leading online and mobile food-ordering and delivery marketplace, today launched its Ultimate technology, a revolutionary, first-of-its-kind proprietary hardware and software solution that integrates all restaurant ordering channels into one system. Replacing error-prone handwritten scribbles and shouts, Ultimate is a digital workflow solution, connecting the front- and back-of-the house directly with diners and creating a transparent view into their order status – whether diners order for pickup or delivery on Grubhub, at an in-store kiosk, or directly with a cashier.

There are four components that make up the Ultimate technology:

  • Lightweight point of sale (POS) with direct integration to the Grubhub web and mobile app
  • Heads-up customer displays to show real-time order estimates across all channels
  • In-store self-ordering kiosks to complement the Grubhub app
  • Kitchen display system (KDS)

“Diners have come to expect ordering ahead for pickup to breeze through busy rush hour crowds and grab their morning coffee or lunch, but currently they can only enjoy this convenience at large QSRs. Ultimate now gives restaurants of any size this ability to please diners with an easy, digital pickup experience,” said Matt Maloney, Grubhub founder & CEO. “With Ultimate, we went even further by building integrated kiosks and a digital queue – in person and online – so diners can see the exact status of their order at any time. Most people do not want to order in person or by calling if they have an alternative, and by integrating pickup with delivery orders our restaurant partners have a complete picture to more efficiently manage their operations.”

Pickup, which composes more than half of the over $250 billion U.S. takeout market, is a massive and growing opportunity that has not yet been transformed by digital ordering. The Ultimate technology accelerates adoption of digital pickup and improves capacity management for restaurants of all sizes, giving unique line of sight into all ETAs regardless of the ordering channel. Whether ordering on-the-go or in-person from the cashier or a kiosk, diners get complete visibility in the app and on the displays at the storefront through the Ultimate technology.

“Ultimate is exactly what I was looking for but didn’t know it,” said David Morton, co-owner of Chicago-based DMK restaurant group. “We have designed our new restaurants around this technology because it allows us to provide better service to our customers with less effort and cost. This is a game changer in quick-serve and fast casual restaurants.”

With more than five years of research and development, Ultimate began as an in-app queue where college students could order ahead while sitting in class and have a real-time view of exactly how many orders were ahead of them. They could continue to monitor their order status and would be notified when their order was ready. This transparency allowed students to manage their schedules and avoid skipping meals or eating at other restaurants because of unexpected long lines at their favorites – and still get to their next class on time.

“Students enjoy the convenience of self-ordering opportunities, and we’ve seen demand for our food service operations increase since installation across our campus. It increased the efficiency of our operation while providing a service that is highly desired by our students,” said Zia Ahmed, Senior Director, Dining Services at The Ohio State University.

In addition to ordering ahead via Grubhub, in-store ordering kiosks allow restaurants to migrate employees away from the cash register and back to food prep lines and fulfilment areas, expediting and ensuring accuracy of orders and increasing throughput. Real-time ETAs appear once an order is placed, allowing customers and delivery drivers to precisely time their arrival, avoiding unnecessary and frustrating waiting. Driving further efficiency, the queue seen by customers is identical to that seen by all employees throughout the restaurant, sharing automatic updates at each stage of the order process.

The Ultimate technology also unlocks the potential for stadiums and food halls to join the next generation of restaurants, opening up a new experience for today’s digitally-savvy diner. Instead of standing in never-ending lines, sports fans and concert-goers can order ahead directly from their seat via Grubhub, watching their place from the in-app queue for the exact moment the order is ready. Food halls are able to provide diners a real-time view into wait times for a variety of restaurants, giving the diner control of balancing the choice between restaurant selection and time to food pickup.

Restaurant owners and staff now have access to a custom-built solution, smoothing out process and demand during daily rushes. Currently in over 100 locations, the Ultimate pilot rollout has focused on New York City and Chicago where restaurants have seen pickup demand impact their bottom line. “Since installing Ultimate, I’ve seen sales increase by 10% and employee costs decrease by 15%. I have staff preparing food instead of taking orders and my customers love the kiosks and transparency. This is a millennials’ dream come true,” said Joe Germonatta of Art Bird & Whiskey Bar in Grand Central Station.

For more information, visit ultimate.grubhub.com.

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 140,000 restaurant partners in over 2,700 U.S. cities and London. The Grubhub portfolio of brands includes Grubhub, Seamless, LevelUp, Tapingo, AllMenus and MenuPages.