(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) |
Securities registered pursuant to Section 12(b) of the Exchange Act | ||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Item 9.01 | Financial Statements and Exhibits. | |||
(d) Exhibits | ||||
Exhibit No. | Description | |||
The Meet Group, Inc. press release, dated August 6, 2020. | ||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
THE MEET GROUP, INC. | |||
Date: | August 6, 2020 | By: | /s/Geoffrey Cook |
Geoffrey Cook | |||
Chief Executive Officer |
• | Total revenue of $90.3 million, up 74% from the second quarter of 2019. |
• | GAAP net income of $10.4 million, or $0.14 per diluted share, compared with GAAP net income of $2.2 million, or $0.03 per diluted share in the second quarter of 2019. |
• | Adjusted EBITDA of $20.8 million, compared with $9.8 million in the second quarter of 2019. |
• | Non-GAAP net income of $19.7 million, or $0.26 per diluted share, compared with $8.8 million, or $0.11 per diluted share, in the second quarter of 2019. |
• | Transaction with ProSiebenSat.1’s and General Atlantic’s joint company NuCom Group expected to close in the second half of 2020. |
(Unaudited) | |||||||
June 30, 2020 | December 31, 2019 | ||||||
Assets: | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 47,644 | $ | 27,241 | |||
Accounts receivable, net | 33,230 | 25,234 | |||||
Prepaid expenses and other current assets | 6,464 | 6,062 | |||||
Total current assets | 87,338 | 58,537 | |||||
Deferred tax assets | 13,616 | 16,233 | |||||
Property and equipment, net | 2,701 | 3,625 | |||||
Operating lease right-of-use assets | 6,550 | 7,034 | |||||
Intangible assets, net | 24,947 | 29,305 | |||||
Goodwill | 156,749 | 156,687 | |||||
Other assets | 700 | 1,300 | |||||
Total assets | $ | 292,601 | $ | 272,721 | |||
Liabilities and stockholders' equity: | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 8,610 | $ | 5,346 | |||
Accrued liabilities | 24,806 | 20,090 | |||||
Current portion of long-term debt | 3,500 | 3,500 | |||||
Current portion of operating lease liabilities | 2,464 | 2,081 | |||||
Current portion of finance lease obligations | 9 | 10 | |||||
Deferred revenue | 3,720 | 3,884 | |||||
Total current liabilities | 43,109 | 34,911 | |||||
Long-term debt, net | 28,672 | 30,375 | |||||
Long-term operating lease liabilities | 4,204 | 5,024 | |||||
Long-term finance lease obligations | 46 | 53 | |||||
Long-term derivative liabilities | 913 | 1,451 | |||||
Deferred tax liabilities | 2,616 | 2,773 | |||||
Other liabilities | — | 894 | |||||
Total liabilities | 79,560 | 75,481 | |||||
Commitments and contingencies | |||||||
Stockholders' equity: | |||||||
Preferred stock, $0.001 par value; authorized - 5,000,000 shares; no shares issued and outstanding as of June 30, 2020 and December 31, 2019 | — | — | |||||
Series A junior participating preferred stock, $0.001 par value; authorized - 200,000 shares; no shares issued and outstanding as of June 30, 2020 and December 31, 2019 | — | — | |||||
Common stock, $0.001 par value; authorized - 100,000,000 shares; 72,792,571 and 70,756,013 shares issued and outstanding as of June 30, 2020 and December 31, 2019, respectively | 73 | 71 | |||||
Additional paid-in capital | 438,345 | 430,959 | |||||
Accumulated deficit | (223,694 | ) | (231,441 | ) | |||
Accumulated other comprehensive loss | (1,683 | ) | (2,349 | ) | |||
Total stockholders’ equity | 213,041 | 197,240 | |||||
Total liabilities and stockholders’ equity | $ | 292,601 | $ | 272,721 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Revenue | $ | 90,332 | $ | 52,000 | $ | 145,398 | $ | 101,513 | |||||||
Operating costs and expenses: | |||||||||||||||
Sales and marketing | 8,089 | 9,060 | 15,803 | 16,900 | |||||||||||
Product development and content | 57,627 | 30,151 | 95,298 | 61,273 | |||||||||||
General and administrative | 6,663 | 5,892 | 11,693 | 10,820 | |||||||||||
Depreciation and amortization | 2,689 | 3,430 | 5,509 | 6,628 | |||||||||||
Acquisition, restructuring and other | 1,335 | 25 | 4,705 | 504 | |||||||||||
Total operating costs and expenses | 76,403 | 48,558 | 133,008 | 96,125 | |||||||||||
Income from operations | 13,929 | 3,442 | 12,390 | 5,388 | |||||||||||
Other income (expense): | |||||||||||||||
Interest income | 7 | 28 | 20 | 60 | |||||||||||
Interest expense | (554 | ) | (328 | ) | (950 | ) | (731 | ) | |||||||
Gain (loss) on foreign currency transactions | 3 | (2 | ) | (4 | ) | (68 | ) | ||||||||
Loss on disposal of assets | — | — | (108 | ) | — | ||||||||||
Other items of (expense) income, net | — | (1 | ) | 2 | 3 | ||||||||||
Total other expense | (544 | ) | (303 | ) | (1,040 | ) | (736 | ) | |||||||
Income before income tax expense | 13,385 | 3,139 | 11,350 | 4,652 | |||||||||||
Income tax expense | (3,006 | ) | (935 | ) | (3,379 | ) | (1,190 | ) | |||||||
Net income | $ | 10,379 | $ | 2,204 | $ | 7,971 | $ | 3,462 | |||||||
Basic and diluted net income per share: | |||||||||||||||
Basic net income per share | $ | 0.14 | $ | 0.03 | $ | 0.11 | $ | 0.05 | |||||||
Diluted net income per share | $ | 0.14 | $ | 0.03 | $ | 0.10 | $ | 0.04 | |||||||
Weighted-average shares outstanding: | |||||||||||||||
Basic | 72,030,143 | 75,648,621 | 71,516,532 | 75,250,562 | |||||||||||
Diluted | 76,225,180 | 78,508,559 | 76,073,893 | 78,656,115 |
Six Months Ended June 30, | |||||||
2020 | 2019 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 7,971 | $ | 3,462 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 5,509 | 6,628 | |||||
Amortization of right-of-use assets | 1,284 | 1,294 | |||||
Stock-based compensation expense | 6,035 | 5,290 | |||||
Deferred tax expense | 2,317 | 268 | |||||
Loss on disposal of assets | 108 | — | |||||
Loss on foreign currency transactions | 4 | 68 | |||||
Provision for expected credit losses | 989 | 909 | |||||
Non-cash interest expense | 452 | 94 | |||||
Changes in derivatives | 246 | — | |||||
Changes in contingent consideration obligations | 45 | 64 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (9,137 | ) | 2,414 | ||||
Prepaid expenses, other current assets and other assets | 47 | (484 | ) | ||||
Accounts payable and accrued liabilities | 5,399 | (6,021 | ) | ||||
Deferred revenue | (164 | ) | (19 | ) | |||
Net cash provided by operating activities | 21,105 | 13,967 | |||||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (233 | ) | (688 | ) | |||
Acquisition of business, net of cash acquired | — | (11,808 | ) | ||||
Net cash used in investing activities | (233 | ) | (12,496 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from exercise of stock options | 1,987 | 703 | |||||
Repurchases of common stock | (65 | ) | — | ||||
Payments of finance leases | (7 | ) | (78 | ) | |||
Proceeds from revolving loan | — | 7,000 | |||||
Payments for restricted stock awards withheld for taxes | (636 | ) | (371 | ) | |||
Payments of term loan | (1,750 | ) | (11,067 | ) | |||
Net cash used in financing activities | (471 | ) | (3,813 | ) | |||
Change in cash and cash equivalents prior to effect of foreign currency exchange rate | 20,401 | (2,342 | ) | ||||
Effect of foreign currency exchange rate | 2 | 29 | |||||
Net increase (decrease) in cash and cash equivalents | 20,403 | (2,313 | ) | ||||
Cash and cash equivalents as of beginning of period | 27,241 | 28,366 | |||||
Cash and cash equivalents as of end of period | $ | 47,644 | $ | 26,053 | |||
Supplemental disclosure of cash flow information: | |||||||
Cash paid for interest | $ | 245 | $ | 630 | |||
Cash paid for income taxes | $ | 1,375 | $ | 1,320 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||||||||||
$ | % | $ | % | $ | % | $ | % | ||||||||||||||||||||
User pay revenue: | |||||||||||||||||||||||||||
Video | $ | 61,350 | 67.9 | % | $ | 21,279 | 40.9 | % | $ | 89,983 | 61.9 | % | $ | 41,508 | 40.9 | % | |||||||||||
Subscription and other in-app products | 20,031 | 22.2 | % | 15,642 | 30.1 | % | 34,426 | 23.7 | % | 31,238 | 30.8 | % | |||||||||||||||
Total user pay revenue | 81,381 | 90.1 | % | 36,921 | 71.0 | % | 124,409 | 85.6 | % | 72,746 | 71.7 | % | |||||||||||||||
Advertising revenue | 8,951 | 9.9 | % | 15,079 | 29.0 | % | 20,989 | 14.4 | % | 28,767 | 28.3 | % | |||||||||||||||
Total revenue | $ | 90,332 | 100.0 | % | $ | 52,000 | 100.0 | % | $ | 145,398 | 100.0 | % | $ | 101,513 | 100.0 | % |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Net income | $ | 10,379 | $ | 2,204 | $ | 7,971 | $ | 3,462 | |||||||
Interest expense | 554 | 328 | 950 | 731 | |||||||||||
Income tax expense | 3,006 | 935 | 3,379 | 1,190 | |||||||||||
Depreciation and amortization expense | 2,689 | 3,430 | 5,509 | 6,628 | |||||||||||
Stock-based compensation expense | 2,850 | 2,865 | 6,035 | 5,290 | |||||||||||
Acquisition, restructuring and other | 1,335 | 25 | 4,705 | 504 | |||||||||||
Loss on disposal of assets | — | — | 108 | — | |||||||||||
(Gain) loss on foreign currency transactions | (3 | ) | 2 | 4 | 68 | ||||||||||
Adjusted EBITDA | $ | 20,810 | $ | 9,789 | $ | 28,661 | $ | 17,873 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Net income | $ | 10,379 | $ | 2,204 | $ | 7,971 | $ | 3,462 | |||||||
Stock-based compensation expense | 2,850 | 2,865 | 6,035 | 5,290 | |||||||||||
Amortization of intangibles | 2,176 | 2,778 | 4,353 | 5,340 | |||||||||||
Income tax expense | 3,006 | 935 | 3,379 | 1,190 | |||||||||||
Acquisition, restructuring and other | 1,335 | 25 | 4,705 | 504 | |||||||||||
Non-GAAP Net Income | $ | 19,746 | $ | 8,807 | $ | 26,443 | $ | 15,786 | |||||||
GAAP basic net income per share | $ | 0.14 | $ | 0.03 | $ | 0.11 | $ | 0.05 | |||||||
GAAP diluted net income per share | $ | 0.14 | $ | 0.03 | $ | 0.10 | $ | 0.04 | |||||||
Basic Non-GAAP Net Income per share | $ | 0.27 | $ | 0.12 | $ | 0.37 | $ | 0.21 | |||||||
Diluted Non-GAAP Net Income per share | $ | 0.26 | $ | 0.11 | $ | 0.35 | $ | 0.20 | |||||||
Weighted-average shares outstanding: | |||||||||||||||
Basic | 72,030,143 | 75,648,621 | 71,516,532 | 75,250,562 | |||||||||||
Diluted | 76,225,180 | 78,508,559 | 76,073,893 | 78,656,115 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Net cash provided by operating activities | $ | 15,554 | $ | 10,605 | $ | 21,105 | $ | 13,967 | |||||||
Purchases of property and equipment | (146 | ) | (405 | ) | (233 | ) | (688 | ) | |||||||
Free Cash Flow | $ | 15,408 | $ | 10,200 | $ | 20,872 | $ | 13,279 |
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