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Grubhub Reports on Q4 and FY2020

 02/10/2021

On February 3rd, Grubhub Inc (GRUB) reported on Q4 and FY2020 ending December 31st.

 

For the quarter, the company lost $67.8 million on revenue of $503.8 million, with a negative EPS of $0.73.  For the comparable period in 2019, the company lost $27.7 million on revenue of $341.3 million with a negative EPS of $0.30.  For Fiscal 2020, the company lost $155.9 million on revenue of $1.8 billion with a negative EPS of 1.69.  The balance sheet for December 31st, 2020 lists total assets of $2.4 billion of which $1.5 billion was represented by goodwill and intangibles.  The company carries $0.5 billion in long-term debt.

 

For the quarter, the company recorded 31.4 million active diners, a 22.6 million increase from the 4th quarter of 2019.  Gross food sales attained $2.4 billion, a 52 percent increase over the $1.6 billion for the 4th quarter of 2019.

 

In commenting on the results, Adam DeWitt, president and CFO noted, “2020 was a transformative year for our marketplace.  Strong new diner and restaurant additions across all of our markets coupled with increased order frequency from existing diners culminated in record gross food sales during the 4th quarter.”  The president and CFO was less expansive on the reasons for continued losses that are apparently withi the “operations and support” category.

 

Grubhub has a market capitalization of $6.3 billion and has traded over the past 52 weeks in a range of $29.35 to $85.53 with a 50-day moving average of $75.40.  Operating margin was negative 8.2 and profit margin negative 8.6 percent.  On a 12-month trailing basis the company has generated negative returns on assets of 3.9 percent and on equity 10.7 percent.  Consistent with company performance, 21.4 percent of the float was short as of January 15th.

 

It is estimated that the company lost $1.12 on each order during the 4th quarter, compared to a loss of $0.60 per order in Q4 of 2019.

 

In June 2020, Grubhub was acquired by Just Eat Takeaway.com and it is anticipated that the profitable parent company will modify the U.S. business model to concentrate on the more profitable app-ordering activity and deemphasize loss-making delivery.