Groupon, Inc. · NASDAQ:GRPN
Groupon — Q2 2019 Earnings Presentation
21 slides from Groupon's earnings presentation, Jul 31, 2019
Slide 1: 2Q19 Earnings
2Q19 EARNINGS July 2019 NASDAQ: GRPN / ir@groupon.com
Slide 2: Forward-Looking Statements
Forward-Looking Statements The statements contained in this release that refer to plans and expectations for the next quarter, the full year or the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exc
Slide 3: Groupon Is a Clear Leader in Local E-commerce
Groupon Is a Clear Leader in Local E-commerce SUBSTANTIAL SCALE IN UNDER-PENETRATED LOCAL MARKET • Strong brand awareness supported by offline advertising campaigns • Mobile-first platform well-positioned Top 5 ~75 % for continued offline-to-online shift • Advanced analytics allow us to E-commerce O
Slide 4: Focusing on Our Key Priorities for 2019
Focusing on Our Key Priorities for 2019 Customer Experience Open Platform Enhance the customer experience Extend Groupon's open platform by and increase conversion by expanding supplementing Groupon-sourced frictionless technologies, such as inventory with third-party card-linking and booking, and p
Slide 5: Enhancing our Financial Profile
Enhancing our Financial Profile Focus on driving long-term Gross Profit maximization • Expect increases in Gross Profit per customer to offset a meaningful portion of an anticipated Gross Profit decline in global customers in 2019 • Focus on driving conversion in core North America Local business th
Slide 6: 2019 Adjusted EBITDA Guidance
2019 Adjusted EBITDA Guidance 2019 Guidance • Support key initiatives to drive Adjusted EBITDA1 conversion and Gross Profit per (USD millions) customer growth • Expect traffic headwinds to persist in 2018 2019 2019 Actual Guidance • Maintain culture of operational efficiency $270 $270 • Pave the pat
Slide 7: Financial Information and Operating Metrics
FINANCIAL INFORMATION AND OPERATING METRICS 7
Slide 8: Large Customer Base with Solid Gross Profit / Customer
Large Customer Base with Solid Gross Profit / Customer Global Active Customers1 (millions) Global TTM Gross Profit / Active Customer1 +1% y/y $27.27 $27.51 $27.42 $27.59 $27.51 49.3 48.8 48.2 47.2 46.2 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 Gross Profit per customer up 1% year-over-year i
Slide 9: Consolidated Gross Profit
Consolidated Gross Profit (USD millions) North America International Global -10% -10% $248 $118 y/y -9% $366 y/y y/y $104 $102 $324 $96 $94 $306 $306 $219 $292 $210 $204 $199 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 ex-f/x (5)% (8)% Global Gross Profit of $292 milli
Slide 10: North America Gross Profit
North America Gross Profit (USD millions) NA Local Gross Profit NA Goods Gross Profit NA Gross Profit $56 -9% -5% $248 y/y y/y $180 -26% $219 $204 $210 $165 $161 y/y $199 $159 $158 $38 $33 $31 $28 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 North America Gross Profit o
Slide 11: International Gross Profit
International Gross Profit (USD millions) International Local Gross International Goods Gross International Gross Profit % Profit -2 Profit $80 y/y $72 -10% $67 $69 y/y $66 $118 $104 $102 $96 $94 % $28 $28 -27 y/y $22 $19 $20 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19
Slide 12: Marketing - Invest At 12-18 Month Payback
Marketing - Invest At 12-18 Month Payback Marketing + Order Discounts (USD millions) Incremental Marketing ROI = Gross Profit Incremental = 100% Marketing Spend +4% y/y $159 1 Time to $140 $140 $145 $146 Payback 12 to 18 months $49 $46 $47 $52 $57 • ROI tracking across marketing channels, platforms,
Slide 13: SG&A – Benefiting From Operational Efficiency
SG&A – Benefiting From Operational Efficiency (USD millions) SG&A SBC2 and D&A -4% y/y $54 1 $219 $27 1 $210 $210 $201 $45 $44 $44 $195 $43 $29 $29 $28 $29 $27 $16 $15 $16 $14 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 SBC D&A Global SG&A improved by $8 million or 4% year-over-year in Q2 (1)
Slide 14: Focus On Improving Conversion From Adjusted EBITDA To Free Cash Flow
Focus On Improving Conversion From Adjusted EBITDA To Free Cash Flow (TTM, USD millions) Adjusted EBITDA1, Operating Cash Flow excluding Free Cash Flow excluding IBM settlement2, 3 IBM settlement3, and Capital Expenditures $270 $270 $264 $163 $261 $254 $233 $145 $138 $212 $205 $175 $106 $160 $93 $67
Slide 15: Appendix
APPENDIX GROUPON |
Slide 16: Non-GAAP Reconciliations
Non-GAAP Reconciliations1 ADJUSTED EBITDA - QUARTERLY THE FOLLOWING IS A RECONCILIATION OF ADJUSTED EBITDA TO THE MOST COMPARABLE U.S. GAAP PERFORMANCE MEASURE, “INCOME (LOSS) FROM CONTINUING OPERATIONS”: (in thousands) 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 Income (loss) from continuing operations
Slide 17: Non-GAAP Reconciliations: Expected Adjusted EBITDA Range
Non-GAAP Reconciliations Cont’d EXPECTED ADJUSTED EBITDA RANGE THE FOLLOWING IS A RECONCILIATION OF THE COMPANY’S ANNUAL OUTLOOK FOR ADJUSTED EBITDA TO THE COMPANY’S OUTLOOK FOR THE MOST COMPARABLE U.S. GAAP PERFORMANCE MEASURE, “INCOME (LOSS) FROM CONTINUING OPERATIONS”: Year Ending (in thousands)
Slide 18: Non-GAAP Reconciliations: Non-GAAP Earnings Per Share
Non-GAAP Reconciliations Cont’d NON-GAAP EARNINGS PER SHARE AND NON-GAAP EARNINGS THE FOLLOWING IS A RECONCILIATION OF NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS TO NON-GAAP NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS AND A RECONCILIATION OF DILUTED NET INCOME (LOSS) PER SHARE T
Slide 19: Non-GAAP Reconciliations: Free Cash Flow
Non-GAAP Reconciliations Cont’d FREE CASH FLOW THE FOLLOWING IS A RECONCILIATION OF FREE CASH FLOW TO THE MOST COMPARABLE U.S. GAAP FINANCIAL MEASURE, “NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES FROM CONTINUING OPERATIONS”: (in thousands) 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 Net cash pro
Slide 20: Non-GAAP Reconciliations: Operating Cash Flow excluding IBM Settlement
Non-GAAP Reconciliations Cont’d Q2 2019 Operating Cash Flow excluding IBM Settlement THE FOLLOWING IS A RECONCILIATION OF TTM OPERATING CASH FLOW EXCLUDING IBM SETTLEMENT TO THE MOST COMPARABLE U.S. GAAP FINANCIAL MEASURE: (in thousands) 2Q19 TTM Operating cash flow $ 117,725 Operating cash outflow
Slide 21: Groupon
GROUPON GROUPON |