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As filed with the Securities and Exchange Commission on November 6, 2020
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| | | | | |
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Quarterly Period Ended September 30, 2020
Or
| | | | | |
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
| For the transition period from__________to__________ |
Commission File No. 001-38220
ANGI HOMESERVICES INC.
(Exact name of registrant as specified in its charter)
| | | | | | | | |
| Delaware | | 82-1204801 |
(State or other jurisdiction of
incorporation or organization) | | (I.R.S. Employer
Identification No.) |
3601 Walnut Street, Denver, CO 80205
(Address of registrant's principal executive offices)
(303) 963-7200
(Registrant's telephone number, including area code)
| | | | | | | | | | | | | | |
| Securities registered pursuant to Section 12(b) of the Act: |
| Title of each class | | Trading Symbol | | Name of exchange on which registered |
| Class A Common Stock, par value $0.001 | | ANGI | | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Large accelerated filer | ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | ☐ | Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of October 30, 2020, the following shares of the registrant's common stock were outstanding:
| | | | | |
| Class A Common Stock | 77,938,213 | |
| Class B Common Stock | 421,859,085 | |
| Class C Common Stock | — | |
| Total outstanding Common Stock | 499,797,298 | |
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
| | | | | | | | | | | |
| September 30, 2020 | | December 31, 2019 |
| (In thousands, except par value amounts) |
| ASSETS | | | |
| Cash and cash equivalents | $ | 855,044 | | | $ | 390,565 | |
| Marketable debt securities | 49,992 | | | — | |
Accounts receivable, net of allowance and reserves of $29,787 and $20,293, respectively | 51,721 | | | 41,669 | |
| Other current assets | 69,500 | | | 67,759 | |
| Total current assets | 1,026,257 | | | 499,993 | |
| | | |
| Capitalized software, leasehold improvements and equipment, net of accumulated depreciation and amortization | 104,323 | | | 103,361 | |
| Goodwill | 884,696 | | | 883,960 | |
| Intangible assets, net of accumulated amortization | 212,927 | | | 251,725 | |
| | | |
| Other non-current assets | 186,398 | | | 182,572 | |
| TOTAL ASSETS | $ | 2,414,601 | | | $ | 1,921,611 | |
| | | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | | | |
| LIABILITIES: | | | |
| Current portion of long-term debt | $ | 13,750 | | | $ | 13,750 | |
| Accounts payable | 42,973 | | | 25,987 | |
| Deferred revenue | 58,169 | | | 58,220 | |
| Accrued expenses and other current liabilities | 153,566 | | | 116,997 | |
| Total current liabilities | 268,458 | | | 214,954 | |
| | | |
| Long-term debt, net | 715,408 | | | 231,946 | |
| Deferred income taxes | 2,088 | | | 3,441 | |
| Other long-term liabilities | 119,112 | | | 121,055 | |
| | | |
| Redeemable noncontrolling interests | 25,774 | | | 26,663 | |
| | | |
| Commitments and contingencies | | | |
| | | |
| SHAREHOLDERS' EQUITY: | | | |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 92,660 and 87,007 shares, respectively, and outstanding77,537 and 79,681, respectively | 93 | | | 87 | |
Class B common stock, $0.001 par value; authorized 1,500,000 shares; 421,859 and 421,570 shares issued and outstanding | 422 | | | 422 | |
Class C common stock, $0.001 par value; authorized 1,500,000 shares; no shares issued and outstanding | — | | | — | |
| Additional paid-in capital | 1,362,977 | | | 1,357,075 | |
| Retained earnings | 24,213 | | | 16,032 | |
| Accumulated other comprehensive loss | (985) | | | (1,379) | |
Treasury stock, 15,123 and 7,326 shares, respectively | (112,808) | | | (57,949) | |
| Total ANGI Homeservices Inc. shareholders' equity | 1,273,912 | | | 1,314,288 | |
| Noncontrolling interests | 9,849 | | | 9,264 | |
| Total shareholders' equity | 1,283,761 | | | 1,323,552 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 2,414,601 | | | $ | 1,921,611 | |
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2020 | | 2019 | | 2020 | | 2019 |
| (In thousands, except per share data) |
| Revenue | $ | 389,913 | | | $ | 357,358 | | | $ | 1,108,624 | | | $ | 1,004,697 | |
| Operating costs and expenses: | | | | | | | |
| Cost of revenue (exclusive of depreciation shown separately below) | 48,253 | | | 13,312 | | | 122,524 | | | 34,045 | |
| Selling and marketing expense | 210,171 | | | 195,542 | | | 590,114 | | | 567,011 | |
| General and administrative expense | 90,122 | | | 82,344 | | | 270,129 | | | 254,786 | |
| Product development expense | 17,577 | | | 16,021 | | | 50,068 | | | 46,907 | |
| Depreciation | 13,921 | | | 11,244 | | | 38,614 | | | 27,039 | |
| Amortization of intangibles | 12,888 | | | 14,169 | | | 38,846 | | | 42,421 | |
| Total operating costs and expenses | 392,932 | | | 332,632 | | | 1,110,295 | | | 972,209 | |
| Operating (loss) income | (3,019) | | | 24,726 | | | (1,671) | | | 32,488 | |
| Interest expense | (3,699) | | | (3,007) | | | (7,593) | | | (8,964) | |
| Other income, net | 223 | | | 1,505 | | | 856 | | | 4,823 | |
| (Loss) earnings before income taxes | (6,495) | | | 23,224 | | | (8,408) | | | 28,347 | |
| Income tax benefit (provision) | 11,698 | | | (4,900) | | | 17,638 | | | 7,062 | |
| Net earnings | 5,203 | | | 18,324 | | | 9,230 | | | 35,409 | |
| Net earnings attributable to noncontrolling interests | (731) | | | (325) | | | (1,049) | | | (473) | |
| Net earnings attributable to ANGI Homeservices Inc. shareholders | $ | 4,472 | | | $ | 17,999 | | | $ | 8,181 | | | $ | 34,936 | |
| | | | | | | |
| Earnings per share information attributable to ANGI Homeservices Inc. shareholders: | | |
| Basic earnings per share | $ | 0.01 | | | $ | 0.04 | | | $ | 0.02 | | | $ | 0.07 | |
| Diluted earnings per share | $ | 0.01 | | | $ | 0.04 | | | $ | 0.02 | | | $ | 0.07 | |
| | | | | | | |
| Stock-based compensation expense by function: | | | | | | | |
| | | | | | | |
| Selling and marketing expense | $ | 2,346 | | | $ | 796 | | | $ | 4,069 | | | $ | 2,801 | |
| General and administrative expense | 10,866 | | | 6,375 | | | 46,977 | | | 37,124 | |
| Product development expense | 1,485 | | | 1,613 | | | 3,985 | | | 5,661 | |
| Total stock-based compensation expense | $ | 14,697 | | | $ | 8,784 | | | $ | 55,031 | | | $ | 45,586 | |
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2020 | | 2019 | | 2020 | | 2019 |
| (In thousands) |
| Net earnings | $ | 5,203 | | | $ | 18,324 | | | $ | 9,230 | | | $ | 35,409 | |
| Other comprehensive income (loss), net of income taxes: | | | | | | | |
| Change in foreign currency translation adjustment | 3,053 | | | (3,071) | | | 971 | | | (2,880) | |
| Change in unrealized gains and losses on available-for-sale debt securities | — | | | — | | | — | | | (3) | |
| Total other comprehensive income (loss), net of income taxes | 3,053 | | | (3,071) | | | 971 | | | (2,883) | |
| Comprehensive income, net of income taxes | 8,256 | | | 15,253 | | | 10,201 | | | 32,526 | |
Components of comprehensive (income) loss attributable to noncontrolling interests: | | | | | | | |
| Net earnings attributable to noncontrolling interests | (731) | | | (325) | | | (1,049) | | | (473) | |
| Change in foreign currency translation adjustment attributable to noncontrolling interests | (1,298) | | | 390 | | | (577) | | | 581 | |
| Comprehensive (income) loss attributable to noncontrolling interests | (2,029) | | | 65 | | | (1,626) | | | 108 | |
| Comprehensive income attributable to ANGI Homeservices Inc. shareholders | $ | 6,227 | | | $ | 15,318 | | | $ | 8,575 | | | $ | 32,634 | |
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Three Months Ended September 30, 2020 and 2019
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | ANGI Homeservices Inc. Shareholders' Equity | | | | |
| | | | Class A Common Stock $0.001 Par Value | | Class B Common Stock $0.001 Par Value | | Class C Common Stock $0.001 Par Value | | | | | | | | | | Total ANGI Homeservices Inc. Shareholders' Equity | | | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Accumulated
Other
Comprehensive (Loss) Income | | | | | | | Total
Shareholders'
Equity |
| Redeemable
Noncontrolling
Interests | | | | | | | | | | | | | | | Additional Paid-in Capital | | Retained Earnings (Accumulated Deficit) | | | Treasury
Stock | | | Noncontrolling
Interests | |
| | | $ | | Shares | | $ | | Shares | | $ | | Shares | | | | | | | |
| | | | (In thousands) | | |
| Balance as of June 30, 2020 | $ | 25,093 | | | | $ | 89 | | | 89,076 | | | $ | 422 | | | 421,757 | | | $ | — | | | — | | | $ | 1,387,618 | | | $ | 19,741 | | | $ | (2,740) | | | $ | (112,808) | | | $ | 1,292,322 | | | $ | 9,604 | | | $ | 1,301,926 | |
| Net earnings | 438 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 4,472 | | | — | | | — | | | 4,472 | | | 293 | | | 4,765 | |
| Other comprehensive income, net of income taxes | 920 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 1,755 | | | — | | | 1,755 | | | 378 | | | 2,133 | |
| Stock-based compensation expense | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | 13,846 | | | — | | | — | | | — | | | 13,846 | | | — | | | 13,846 | |
| Issuance of common stock pursuant to stock-based awards, net of withholding taxes | — | | | | 4 | | | 3,584 | | | — | | | — | | | — | | | — | | | (37,842) | | | — | | | — | | | — | | | (37,838) | | | — | | | (37,838) | |
| Issuance of common stock to IAC pursuant to the employee matters agreement | — | | | | — | | | — | | | — | | | 102 | | | — | | | — | | | (632) | | | — | | | — | | | — | | | (632) | | | — | | | (632) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Adjustment of redeemable noncontrolling interests to fair value | (677) | | | | — | | | — | | | — | | | — | | | — | | | — | | | 677 | | | — | | | — | | | — | | | 677 | | | — | | | 677 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Purchase of noncontrolling interests | — | | | | — | | | — | | | — | | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (1,115) | | | (1,115) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Other | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | (690) | | | — | | | — | | | — | | | (690) | | | 689 | | | (1) | |
| Balance as of September 30, 2020 | $ | 25,774 | | | | $ | 93 | | | 92,660 | | | $ | 422 | | | 421,859 | | | $ | — | | | — | | | $ | 1,362,977 | | | $ | 24,213 | | | $ | (985) | | | $ | (112,808) | | | $ | 1,273,912 | | | $ | 9,849 | | | $ | 1,283,761 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance as of June 30, 2019 | $ | 23,421 | | | | $ | 86 | | | 85,803 | | | $ | 421 | | | 421,453 | | | $ | — | | | — | | | $ | 1,338,280 | | | $ | (1,860) | | | $ | (1,482) | | | $ | — | | | $ | 1,335,445 | | | $ | 9,101 | | | $ | 1,344,546 | |
| Net earnings | 233 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 17,999 | | | — | | | — | | | 17,999 | | | 92 | | | 18,091 | |
| Other comprehensive loss | (365) | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (2,681) | | | — | | | (2,681) | | | (25) | | | (2,706) | |
| Stock-based compensation expense | 36 | | | | — | | | — | | | — | | | — | | | — | | | — | | | 8,748 | | | — | | | — | | | — | | | 8,748 | | | — | | | 8,748 | |
| Issuance of common stock pursuant to stock-based awards, net of withholding taxes | — | | | | — | | | 272 | | | — | | | — | | | — | | | — | | | (2,357) | | | — | | | — | | | — | | | (2,357) | | | — | | | (2,357) | |
| Issuance of common stock to IAC pursuant to the employee matters agreement | — | | | | — | | | — | | | 1 | | | 117 | | | — | | | — | | | (971) | | | — | | | — | | | — | | | (970) | | | — | | | (970) | |
| Purchase of treasury stock | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (34,157) | | | (34,157) | | | — | | | (34,157) | |
| Purchase of redeemable noncontrolling interests | (71) | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | |
| Adjustment of redeemable noncontrolling interests to fair value | (1,255) | | | | — | | | — | | | — | | | — | | | — | | | — | | | 1,255 | | | — | | | — | | | — | | | 1,255 | | | — | | | 1,255 | |
| Other | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | 1 | | | — | | | — | | | — | | | 1 | | | — | | | 1 | |
| Balance as of September 30, 2019 | $ | 21,999 | | | | $ | 86 | | | 86,075 | | | $ | 422 | | | 421,570 | | | $ | — | | | — | | | $ | 1,344,956 | | | $ | 16,139 | | | $ | (4,163) | | | $ | (34,157) | | | $ | 1,323,283 | | | $ | 9,168 | | | $ | 1,332,451 | |
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Nine Months Ended September 30, 2020 and 2019
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | ANGI Homeservices Inc. Shareholders' Equity | | | | |
| | | | Class A Common Stock $0.001 Par Value | | Class B Common Stock $0.001 Par Value | | Class C Common Stock $0.001 Par Value | | | | | | | | | | Total ANGI Homeservices Inc. Shareholders' Equity | | | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Accumulated
Other
Comprehensive
(Loss) Income | | | | | | | Total
Shareholders'
Equity |
| Redeemable
Noncontrolling
Interests | | | | | | | | | | | | | | | Additional Paid-in Capital | | Retained Earnings (Accumulated Deficit) | | | Treasury
Stock | | | Noncontrolling
Interests | |
| | | $ | | Shares | | $ | | Shares | | $ | | Shares | | | | | | | |
| | | | (In thousands) | | |
| Balance as of December 31, 2019 | $ | 26,663 | | | | $ | 87 | | | 87,007 | | | $ | 422 | | | 421,570 | | | $ | — | | | — | | | $ | 1,357,075 | | | $ | 16,032 | | | $ | (1,379) | | | $ | (57,949) | | | $ | 1,314,288 | | | $ | 9,264 | | | $ | 1,323,552 | |
| Net earnings | 383 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 8,181 | | | — | | | — | | | 8,181 | | | 666 | | | 8,847 | |
| Other comprehensive income, net of income taxes | 233 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 394 | | | — | | | 394 | | | 344 | | | 738 | |
Stock-based compensation expense | 15 | | | | — | | | — | | | — | | | — | | | — | | | — | | | 54,664 | | | — | | | — | | | — | | | 54,664 | | | — | | | 54,664 | |
| Issuance of common stock pursuant to stock-based awards, net of withholding taxes | — | | | | 6 | | | 5,653 | | | — | | | — | | | — | | | — | | | (48,615) | | | — | | | — | | | — | | | (48,609) | | | — | | | (48,609) | |
| Issuance of common stock to IAC pursuant to the employee matters agreement | — | | | | — | | | — | | | — | | | 289 | | | — | | | — | | | (1,423) | | | — | | | — | | | — | | | (1,423) | | | — | | | (1,423) | |
| Purchase of treasury stock | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (54,859) | | | (54,859) | | | — | | | (54,859) | |
| Purchase of redeemable noncontrolling interests | (3,165) | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | |
| Adjustment of redeemable noncontrolling interests to fair value | 1,645 | | | | — | | | — | | | — | | | — | | | — | | | — | | | (1,645) | | | — | | | — | | | — | | | (1,645) | | | — | | | (1,645) | |
| Purchase of noncontrolling interests | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (1,115) | | | (1,115) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Adjustment pursuant to the tax sharing agreement | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | 3,613 | | | — | | | — | | | — | | | 3,613 | | | — | | | 3,613 | |
| Other | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | (692) | | | — | | | — | | | — | | | (692) | | | 690 | | | (2) | |
| Balance as September 30, 2020 | $ | 25,774 | | | | $ | 93 | | | 92,660 | | | $ | 422 | | | 421,859 | | | $ | — | | | — | | | $ | 1,362,977 | | | $ | 24,213 | | | $ | (985) | | | $ | (112,808) | | | $ | 1,273,912 | | | $ | 9,849 | | | $ | 1,283,761 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Balance as of December 31, 2018 | $ | 18,163 | | | | $ | 81 | | | 80,515 | | | $ | 421 | | | 421,118 | | | $ | — | | | — | | | $ | 1,333,097 | | | $ | (18,797) | | | $ | (1,861) | | | $ | — | | | $ | 1,312,941 | | | $ | 9,046 | | | $ | 1,321,987 | |
| Net earnings | 284 | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 34,936 | | | — | | | — | | | 34,936 | | | 189 | | | 35,125 | |
Other comprehensive loss | (514) | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (2,302) | | | — | | | (2,302) | | | (67) | | | (2,369) | |
| Stock-based compensation expense | 113 | | | | — | | | — | | | — | | | — | | | — | | | — | | | 45,473 | | | — | | | — | | | — | | | 45,473 | | | — | | | 45,473 | |
| Issuance of common stock pursuant to stock-based awards, net of withholding taxes | — | | | | 5 | | | 5,560 | | | — | | | — | | | — | | | — | | | (27,805) | | | — | | | — | | | — | | | (27,800) | | | — | | | (27,800) | |
| Issuance of common stock to IAC pursuant to the employee matters agreement | — | | | | — | | | — | | | 1 | | | 452 | | | — | | | — | | | (1,766) | | | — | | | — | | | — | | | (1,765) | | | — | | | (1,765) | |
| Purchase of treasury stock | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (34,157) | | | (34,157) | | | — | | | (34,157) | |
| Purchase of redeemable noncontrolling interests | (71) | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | |
| Adjustment of redeemable noncontrolling interests to fair value | 4,024 | | | | — | | | — | | | — | | | — | | | — | | | — | | | (4,024) | | | — | | | — | | | — | | | (4,024) | | | — | | | (4,024) | |
| Other | — | | | | — | | | — | | | — | | | — | | | — | | | — | | | (19) | | | — | | | — | | | — | | | (19) | | | — | | | (19) | |
| Balance as of September 30, 2019 | $ | 21,999 | | | | $ | 86 | | | 86,075 | | | $ | 422 | | | 421,570 | | | $ | — | | | — | | | $ | 1,344,956 | | | $ | 16,139 | | | $ | (4,163) | | | $ | (34,157) | | | $ | 1,323,283 | | | $ | 9,168 | | | $ | 1,332,451 | |
ANGI HOMESERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
| | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2020 | | 2019 |
| (In thousands) |
| Cash flows from operating activities: | | | |
| Net earnings | $ | 9,230 | | | $ | 35,409 | |
| Adjustments to reconcile net earnings to net cash provided by operating activities: | | | |
| Stock-based compensation expense | 55,031 | | | 45,586 | |
| Amortization of intangibles | 38,846 | | | 42,421 | |
| Provision for credit losses | 60,090 | | | 49,294 | |
| Depreciation | 38,614 | | | 27,039 | |
| Deferred income taxes | (18,081) | | | (8,294) | |
| Other adjustments, net | 8,694 | | | 6,371 | |
| Changes in assets and liabilities, net of effects of acquisitions and dispositions: | | | |
| Accounts receivable | (70,705) | | | (66,596) | |
| Other assets | 5,200 | | | 15,701 | |
| Accounts payable and other liabilities | 46,941 | | | 30,609 | |
| Income taxes payable and receivable | (570) | | | 1,628 | |
| Deferred revenue | (105) | | | 2,916 | |
| Net cash provided by operating activities | 173,185 | | | 182,084 | |
| Cash flows from investing activities: | | | |
| Acquisition, net of cash acquired | — | | | (20,341) | |
| Capital expenditures | (37,637) | | | (54,801) | |
| Purchases of marketable debt securities | (49,987) | | | — | |
| Proceeds from maturities of marketable debt securities | — | | | 25,000 | |
| Net proceeds from the sale of a business | 730 | | | 23,615 | |
| Other, net | — | | | (103) | |
| Net cash used in investing activities | (86,894) | | | (26,630) | |
| Cash flows from financing activities: | | | |
| Proceeds from the issuance of Senior Notes | 500,000 | | | — | |
| Principal payments on Term Loan | (10,313) | | | (10,313) | |
| Principal payments on related-party debt | — | | | (1,008) | |
| Debt issuance costs | (5,635) | | | — | |
| Purchase of treasury stock | (54,400) | | | (33,979) | |
| Proceeds from the exercise of stock options | — | | | 573 | |
| Withholding taxes paid on behalf of employees on net settled stock-based awards | (49,993) | | | (30,039) | |
| Distribution from (to) IAC pursuant to the tax sharing agreement | 3,071 | | | (11,355) | |
| Purchase of noncontrolling interests | (4,280) | | | (71) | |
| Other, net | — | | | (3,732) | |
| Net cash provided by (used in) financing activities | 378,450 | | | (89,924) | |
| Total cash provided | 464,741 | | | 65,530 | |
| Effect of exchange rate changes on cash and cash equivalents and restricted cash | (354) | | | 387 | |
| Net increase in cash and cash equivalents and restricted cash | 464,387 | | | 65,917 | |
| Cash and cash equivalents and restricted cash at beginning of period | 391,478 | | | 338,821 | |
| Cash and cash equivalents and restricted cash at end of period | $ | 855,865 | | | $ | |
