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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Waitr Holdings Inc | NASDAQ:WTRH | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.0931 | 0.0931 | 0.095 | 0 | 01:00:00 |
Waitr Holdings Inc. (Nasdaq: WTRH) (“Waitr” or the “Company”), a leader in on-demand food ordering and delivery, today reported financial results for the first quarter of 2020.
First Quarter 2020 Highlights
“Since the COVID-19 outbreak intensified in the United States, we have implemented a number of measures to protect our local communities, diners, restaurant partners, drivers and employees,” said Carl Grimstad, Chairman and CEO of Waitr. “We began offering no-contact delivery for all restaurant orders, provided gloves, hand sanitizer and masks to our drivers, and continued to pay any employee or driver who is quarantined or contracts the coronavirus. We also successfully transitioned our customer support and corporate staff to work remotely.”
“We also have taken a number of steps to enhance our offerings and support our restaurant partners and local communities during this time,” added Mr. Grimstad. “We expanded our offerings to include delivery of groceries in 10 markets, including no-contact service, and we started delivering alcohol in some markets. We have been constantly working with new and existing restaurant partners to boost their delivery potential and sustain their businesses in the current environment. We have provided restaurants with free marketing and promotions, discounted delivery fees, cleaning spray and other support. Waitr also recently added a donation feature to its app, the proceeds from which will go to Feeding America and other similar charities to help feed the needy. We are also delivering food to the elderly, children and underprivileged during this unprecedented time of need via partnerships with local food banks and charities.”
“From a financial perspective, earlier this year, we implemented several strategic initiatives with a focus on improving revenue per order, cost per order, cash flow and profitability,” continued Mr. Grimstad. “These actions allowed us to stabilize and position the Company for the long term and allowed us to see our first profitable month in February 2020 and realize $3.7 million of Adjusted EBITDA in the first quarter of 2020. All of our drivers are now independent contractors, and the response from drivers has been overwhelmingly positive. Driver supply remains at a high level while new restaurants are signing up for our services more rapidly than previous quarters. We now have agreements with all Landry’s locations across the country as well as with Five Guys in all of our markets.”
____________________ 1 Adjusted EBITDA is a non-GAAP financial measure. A reconciliation of GAAP net loss to Adjusted EBITDA is included under “Non-GAAP Financial Measure”.
Business Update
As the COVID-19 pandemic became more widespread in the U.S., we initially experienced a decrease in orders in mid-March; however, orders rebounded towards the end of March and continued to grow in April to levels higher than pre-pandemic levels. As a result, we expect April revenue will be approximately $20 million and Adjusted EBITDA for April 2020 to be in excess of $4 million. Since the end of the quarter, we have reached an agreement with our debt holder, Luxor Capital, for the Company to repay $12.5 million of our senior secured credit facility. In a show of confidence in the business, Luxor Capital has also agreed to convert $12.5 million of their convertible notes into our common stock. After the $25.0 million prepayment and conversion, the Company’s long-term debt outstanding will be approximately $107.8 million. While the current economic environment remains inherently uncertain, we are encouraged by our financial results and believe the current situation has only further proved the importance of our services.”
First Quarter 2020 Financial Results
First Quarter and April 2020 Key Business Metrics2
____________________ 2 Key Business Metrics are defined on page 35 of our Annual Report on Form 10-K for the year ended December 31, 2019, filed on March 16, 2020
Liquidity Update
As of March 31, 2020, the Company had cash on hand of $39.4 million, of which $3.2 million was reserved under a compensating balance arrangement with a bank. The Company had total long-term debt outstanding at March 31, 2020 of $132.8 million, consisting of $70.8 million of term loans, $61.6 million of convertible notes and $0.4 million of promissory notes. The term loans and convertible notes mature in November 2022. Outstanding short-term debt as of March 31, 2020 totaled $1.6 million.
The combination of the effects of implementing several strategic initiatives focused on improving revenue per order, cost per order, cash flow and profitability, along with proceeds from the sales of common stock pursuant to the at-the-market offering launched by the Company in March 2020 resulted in increases in working capital and liquidity from December 31, 2019. As of April 30, 2020, we had cash on hand of approximately $53 million.
Other Information
Waitr will not be hosting a conference call to discuss the first quarter 2020 operational and financial results.
About Waitr Holdings Inc.
Founded in 2013 and based in Lafayette, Louisiana, Waitr is a leader in on-demand food ordering and delivery. Waitr, and its sister brand Bite Squad, connects local restaurants and grocery stores to hungry diners in underserved U.S. markets. Together they are a convenient way to discover, order and receive great food from local restaurants, grocery stores and national chains. As of March 31, 2020, Waitr and Bite Squad operated in small and medium sized markets in the United States in over 600 cities.
Cautionary Note Concerning Forward-Looking Statements
This press release contains “forward-looking statements,” as defined by the federal securities laws, including statements regarding the Company’s financial results, implementation of strategic initiatives and future performance of the Company. Forward-looking statements reflect Waitr’s current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words “believe,” “expect,” “anticipate,” “will,” “could,” “would,” “should,” “may,” “plan,” “estimate,” “intend,” “predict,” “potential,” “continue,” and the negatives of these words and other similar expressions generally identify forward-looking statements. Such forward-looking statements are subject to various risks and uncertainties, including the impact of the coronavirus (COVID-19) pandemic on the Company’s business and operations, and those described under the section entitled “Risk Factors” in Waitr’s Annual Report on Form 10-K for the year ended December 31, 2019, filed with the SEC on March 16, 2020, as such factors may be updated from time to time in Waitr’s periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Additional information will be set forth in Waitr’s Quarterly Report on Form 10-Q for the three months ended March 31, 2020, which will be filed with the SEC on May 7, 2020, and should be read in conjunction with these financial results. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in Waitr’s filings with the SEC. While forward-looking statements reflect Waitr’s good faith beliefs, they are not guarantees of future performance. Waitr disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this press release, except as required by applicable law. You should not place undue reliance on any forward-looking statements, which are based only on information currently available to Waitr (or to third parties making the forward-looking statements).
Waitr has thus far been able to operate effectively during the COVID-19 pandemic. However, the potential impacts and duration of the COVID-19 pandemic on the global economy and on the Company’s business, in particular, may be difficult to assess or predict. The pandemic has resulted in, and may continue to result in, significant disruption of global financial markets, which may reduce the Company’s ability to access capital and continue to operate effectively. The COVID-19 pandemic could also reduce the demand for the Company’s services. In addition, a recession or further financial market correction resulting from the spread of COVID-19 could adversely affect demand for the Company’s services. To the extent that the COVID-19 pandemic adversely impacts the Company’s business, results of operations, liquidity or financial condition, it may also have the effect of heightening many of the other risks described in the risk factors in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019.
Non-GAAP Financial Measure
Adjusted EBITDA is a financial measure that is not calculated in accordance with generally accepted accounting principles in the United States of America (“GAAP”).
We define Adjusted EBITDA as net loss adjusted to exclude interest expense, income taxes, depreciation and amortization, acquisition and restructuring costs, stock-based compensation expense, impairments of intangible assets and goodwill and gains and losses associated with derivatives and debt extinguishments and when applicable, other expenses that do not reflect our core operations. We use this non-GAAP financial measure as a key performance measure because we believe it facilitates operating performance comparisons from period to period by excluding potential differences primarily caused by variations in capital structures, tax positions, the impact of acquisitions and restructuring, the impact of depreciation and amortization expense on our fixed assets and the impact of stock-based compensation expense. Adjusted EBITDA 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.
See “Non-GAAP Financial Measure/Adjusted EBITDA” below for a reconciliation of net loss to Adjusted EBITDA for the first quarters ended March 31, 2020 and 2019.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended March 31,
2020
2019
REVENUE
$
44,243
$
48,032
COSTS AND EXPENSES:
Operations and support
26,365
36,183
Sales and marketing
2,826
10,323
Research and development
1,470
1,940
General and administrative
10,778
18,918
Depreciation and amortization
2,064
4,116
Intangible and other asset impairments
—
18
Loss on disposal of assets
8
5
TOTAL COSTS AND EXPENSES
43,511
71,503
INCOME (LOSS) FROM OPERATIONS
732
(23,471
)
OTHER EXPENSES (INCOME) AND LOSSES (GAINS), NET
Interest expense
2,914
1,605
Interest income
(60
)
(339
)
Other income
(37
)
(50
)
NET LOSS BEFORE INCOME TAXES
(2,085
)
(24,687
)
Income tax expense
17
62
NET LOSS
$
(2,102
)
$
(24,749
)
LOSS PER SHARE:
Basic and diluted
$
(0.03
)
$
(0.38
)
Weighted average common shares outstanding – basic and diluted
76,884,717
64,525,610
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
March 31,
December 31,
2020
2019
ASSETS
CURRENT ASSETS
Cash
$
39,376
$
29,317
Accounts receivable, net
3,362
3,272
Capitalized contract costs, current
409
199
Prepaid expenses and other current assets
5,083
8,329
TOTAL CURRENT ASSETS
48,230
41,117
Property and equipment, net
3,608
4,072
Capitalized contract costs, noncurrent
1,543
772
Goodwill
106,734
106,734
Intangible assets, net
24,869
25,761
Other noncurrent assets
484
517
TOTAL ASSETS
$
185,468
$
178,973
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
CURRENT LIABILITIES
Accounts payable
$
5,082
$
4,384
Restaurant food liability
5,021
5,612
Accrued payroll
7,414
5,285
Short-term loans
1,578
3,612
Deferred revenue, current
80
414
Income tax payable
68
51
Other current liabilities
12,125
12,630
TOTAL CURRENT LIABILITIES
31,368
31,988
Long-term debt
125,707
123,244
Accrued workers’ compensation liability
394
463
Deferred revenue, noncurrent
2
45
Other noncurrent liabilities
324
325
TOTAL LIABILITIES
157,795
156,065
STOCKHOLDERS’ EQUITY:
Common stock, $0.0001 par value
8
8
Additional paid in capital
392,004
385,137
Accumulated deficit
(364,339
)
(362,237
)
TOTAL STOCKHOLDERS’ EQUITY
27,673
22,908
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
185,468
$
178,973
CONSOLIDATED CASH FLOW STATEMENTS
(In thousands)
(Unaudited)
Three Months Ended March 31,
2020
2019
Cash flows from operating activities:
Net loss
$
(2,102
)
$
(24,749
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Non-cash interest expense
2,396
388
Non-cash advertising expense
—
142
Stock-based compensation
848
2,033
Equity issued in exchange for services
—
30
Loss on disposal of assets
8
5
Depreciation and amortization
2,064
4,116
Intangible and other asset impairments
—
18
Amortization of capitalized contract costs
68
583
Other non-cash income
(12
)
—
Changes in assets and liabilities:
Accounts receivable
(90
)
(2,883
)
Capitalized contract costs
(1,049
)
(1,007
)
Prepaid expenses and other current assets
3,246
961
Accounts payable
698
(49
)
Restaurant food liability
(591
)
7,428
Deferred revenue
(378
)
347
Income tax payable
17
62
Accrued payroll
2,129
2,168
Accrued workers’ compensation liability
(69
)
(176
)
Other current liabilities
(155
)
(2,093
)
Other noncurrent liabilities
(1
)
(11
)
Net cash provided by (used in) operating activities
7,027
(12,687
)
Cash flows from investing activities:
Purchases of property and equipment
(70
)
(627
)
Acquisition of Bite Squad, net of cash acquired
—
(192,419
)
Other acquisitions
(242
)
—
Collections on notes receivable
21
22
Internally developed software
(671
)
(59
)
Proceeds from sale of property and equipment
3
21
Net cash used in investing activities
(959
)
(193,062
)
Cash flows from financing activities:
Proceeds from issuance of stock
6,584
—
Equity issuance costs
(114
)
(600
)
Proceeds from Additional Term Loans
—
42,080
Payments on short-term loans
(2,028
)
(658
)
Proceeds from exercise of stock options
8
1
Taxes paid related to net settlement on stock-based compensation
(459
)
(799
)
Net cash provided by financing activities
3,991
40,024
Net change in cash
10,059
(165,725
)
Cash, beginning of period
29,317
209,340
Cash, end of period
$
39,376
$
43,615
Supplemental disclosures of cash flow information:
Cash earned during the period for interest
$
48
$
—
Cash paid during the period for interest
518
1,215
Supplemental disclosures of non-cash investing and financing activities:
Stock issued as consideration in Bite Squad acquisition
—
126,573
Stock issued in connection with Additional Term Loans
—
3,884
NON-GAAP FINANCIAL MEASURE
ADJUSTED EBITDA
(In thousands)
(Unaudited)
Three Months Ended March 31,
2020
2019
NET LOSS
$
(2,102
)
$
(24,749
)
Interest expense
2,914
1,605
Income taxes
17
62
Depreciation and amortization
2,064
4,116
Stock-based compensation
848
2,063
Intangible and other asset impairments
—
18
Business combination related expenditures
—
6,949
ADJUSTED EBITDA
$
3,741
$
(9,936
)
View source version on businesswire.com: https://www.businesswire.com/news/home/20200507005331/en/
Investors WaitrIR@icrinc.com
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