Delivered Second Quarter Guidance
Achieved 6% ARPD and 5% Traffic Year-Over-Year
Growth
Generated $56
Million of Year-To-Date Cash Flow From Operations
CHICAGO, Aug. 3, 2023
/PRNewswire/ -- Cars.com Inc. (NYSE: CARS) ("CARS" or the
"Company"), the leading digital automotive platform that provides a
robust set of digital solutions, today released its financial
results for the second quarter ended June
30, 2023.
Q2 2023 Financial and Key Metric Highlights
- Revenue of $168.2 million, up
$5.3 million, or 3%
year-over-year
- Net income of $94.1 million, or
$1.37 per diluted share, compared to
$5.5 million, or $0.08 per diluted share, in the prior year.
Current quarter Net income was primarily related to the release of
a significant portion of the Company's valuation allowance
- Adjusted EBITDA of $45.6 million,
or 27% of revenue, up $0.3 million
year-over-year
- Average Monthly Unique Visitors ("UVs") of 26.9 million,
compared to 27.1 million a year ago
- Traffic ("Visits") of 156.0 million, up 5% year-over-year
- Monthly Average Revenue Per Dealer ("ARPD") of $2,472, up 6% from the prior year period
- Dealer Customers were 18,785 as of June
30, 2023, compared to 19,186 as of March 31, 2023
Operational Highlights
- The Marketplace Repackaging initiative, that better aligns
subscription pricing and value delivery, is over 60% complete;
two-thirds of the repackaged customers have selected the
value-added Preferred or Premium Package, which helped drive more
than half of the Company's year-over-year increase in ARPD
- Website customers increased to nearly 6,200, up 9% from a year
ago and website upsells grew by more than 1,800 from a year ago;
Accu-Trade Connected units increased to over 750 from 100, a year
ago
- Modernized Cars.com logo and launched "Possibilities"
advertising campaign with the tagline "Where to Next?" featuring
how CARS supports consumers and dealers, in every aspect of the car
buying and selling process
- Published 2023 American Made Index and Consumer survey which
found that interest and demand for American-made vehicles remain
strong; consumers are willing to pay up to a 30% premium to support
U.S. jobs. This editorial content garnered more than 550 media
stories promoting the Cars.com brand
"We delivered solid results in the second quarter and garnered
positive dealer reception and adoption of our Preferred and Premium
Packages and digital solutions," said Alex
Vetter, Chief Executive Officer. "Consumer demand remains
strong and customer engagement with our solutions is increasing as
well. We believe that our continued efforts to drive digital
adoption across our industry will yield increased value to
consumers, dealers, and OEMs as well as growth in Revenue and
Adjusted EBITDA this year and beyond."
Q2 2023 Results
Revenue for the second quarter totaled $168.2 million, an increase of $5.3 million, or up 3%, compared to the prior
year period. Dealer revenue grew 6% year-over-year, driven by
continued growth in solutions and media products, as well as growth
resulting from the Marketplace Repackaging initiative.
Second quarter ARPD grew 6%, or $146, year-over-year to $2,472. As of June 30,
2023, Dealer Customers totaled 18,785 as compared to 19,186
at the end of the first quarter of 2023. The sequential change in
Dealer Customers was primarily due to the expected cancellations
driven by lower-inventory customers as a result of the Company's
Marketplace Repackaging initiative. Marketplace revenue growth
drove over 50%, or $78, of the
Company's year-over-year growth in ARPD. The balance of the
Company's ARPD growth was driven by expansion and improved pricing
of dealer solutions, including websites and Accu-Trade.
Total operating expenses for the second quarter were
$155.8 million, compared to
$147.5 million for the prior year
period. Adjusted Operating Expenses for the quarter were
$147.1 million, an $8.3 million increase compared to the prior year
period. The increase is primarily due to increased Marketing and
sales costs largely due to higher compensation, as well as costs
associated with the Company's new advertising campaign. The Company
also continued to invest in Product and technology and experienced
higher compensation and third party costs, including licenses and
consulting costs.
Net income for the quarter was $94.1
million, or $1.37 per diluted
share, compared to $5.5 million, or
$0.08 per diluted share, in the
second quarter of 2022. Current quarter Net income was primarily
related to the release of a significant portion of the Company's
valuation allowance, given the expectation of projected future
income and utilization of the Company's tax assets.
Adjusted EBITDA for the quarter totaled $45.6 million, or 27% of revenue, compared to
$45.3 million, or 28% of revenue, for
the prior year period.
For the quarter, Average Monthly Unique Visitors were 26.9
million and total Traffic increased 5% to 156.0 million, compared
to the second quarter of 2022. Organic traffic grew 4%
year-over-year, driven by increased consumer demand, enhanced
website experiences and continued strength in the Company's App,
where visits increased 13% compared to the prior year.
Cash Flow and Balance Sheet
Net cash provided by operating activities for the six-month
period ended June 30, 2023 was
$56.2 million, compared to
$42.3 million in the prior year. Free
Cash Flow in the first six months totaled $45.6 million compared to $33.7 million in 2022. The increase was primarily
driven by positive changes in working capital and higher Adjusted
EBITDA, which was partially offset by increased cash taxes. In
addition to the semi-annual bond interest payment of $12.8 million, the Company made cash tax payments
of $12.2 million during the
quarter.
During the first six months of 2023, the Company paid down
$22.5 million of debt, reducing total
debt outstanding to $458.8 million,
as of June 30, 2023. At quarter-end,
the Company's net leverage ratio was 2.3x, within its target net
leverage ratio of 2.0x to 2.5x. Total liquidity was $258.6 million, including cash and cash
equivalents of $28.6 million and
$230.0 million of undrawn revolver
capacity, as of June 30, 2023.
Year-to-date, the Company repurchased 0.9 million of its common
shares for $17.2 million.
"We delivered another quarter of solid performance with Revenue
and Adjusted EBITDA, both within our guidance. Our solid results
are a testament to our platform strategy and diversified set of
solutions. Given these results, we are raising the midpoint of our
full-year revenue guidance to 5% year-over-year growth and
reaffirming our margin expectations of approaching 30% by the
fourth quarter," said Sonia Jain,
Chief Financial Officer of CARS.
2023 Outlook
The Company is well-positioned to deliver profitable growth
through continued dealer and OEM adoption of its suite of
value-added solutions. Third quarter revenue is expected to be
between $172.0 million and
$174.0 million, reflecting
year-over-year revenue growth of 4.5% to 5.7%. Guidance reflects
the continued roll-out of the Company's Marketplace Repackaging
initiative, expansion of dealer solutions and media products, and
modest sequential improvement in OEM and National Revenue.
Adjusted EBITDA margin for the third quarter is expected to be
between 26.5% and 28.5%, reflecting third quarter revenue guidance
and increased Marketing investment to support our Cars.com brand
relaunch.
The Company tightened its full-year revenue guidance range to 4%
to 6% year-over-year growth, raising the midpoint of revenue
guidance, which reflects the benefit of the Company's Marketplace
Repackaging initiative and assumes a conservative outlook on OEM
and National Revenue despite recent improvements in inventory
levels.
Margins are expected to improve over the course of the year, and
the Company expects to exit the year with fourth quarter Adjusted
EBITDA margins approaching 30%.
Q2 2023 Earnings Call
As previously announced, management will hold a conference call
and webcast today at 8:00 a.m. CT.
This webcast may be accessed at CARS' Investor Relations
website, investor.cars.com. An archive of the webcast will be
available at investor.cars.com following the conclusion
of the call.
About CARS
CARS is a leading automotive marketplace platform that provides
a robust set of digital solutions that connect car shoppers with
sellers. Launched in 1998 with the flagship
marketplace Cars.com and headquartered in Chicago, the Company empowers shoppers with
the data, resources and digital tools needed to make informed
buying decisions and seamlessly connect with automotive retailers.
In a rapidly changing market, CARS enables dealerships and OEMs
with innovative technical solutions and data-driven intelligence to
better reach and influence ready-to-buy shoppers, increase
inventory turn and gain market share.
In addition to Cars.com™, CARS brands include Dealer Inspire®, a
technology provider building solutions that future-proof
dealerships with more efficient operations and connected digital
experiences; FUEL™, which gives dealers and OEMs the opportunity to
harness the untapped power of digital video by
leveraging Cars.com's pure audience of in-market car shoppers,
DealerRater®, a leading car dealer review and reputation management
platform, CreditIQ®, digital financing technology and Accu-Trade®,
vehicle valuation and appraisal technology.
The full suite of CARS properties includes Cars.com™, Dealer
Inspire®, FUEL™, DealerRater®,CreditIQ®, Accu-Trade.com®. For more
information, visit www.Cars.com
Non-GAAP Financial Measures
This earnings release discusses Adjusted EBITDA, Adjusted EBITDA
margin, Free Cash Flow and Adjusted Operating Expenses. These
financial measures are not prepared in accordance with generally
accepted accounting principles in the
United States ("GAAP"). These financial measures are
presented as supplemental measures of operating performance because
the Company believes they provide meaningful information regarding
the Company's performance and provide a basis to compare operating
results between periods. In addition, the Company uses Adjusted
EBITDA as a measure for determining incentive compensation targets.
Adjusted EBITDA also is used as a performance measure under the
Company's credit agreement and includes adjustments such as the
items defined below and other further adjustments, which are
defined in the credit agreement. These non-GAAP financial measures
are frequently used by the Company's lenders, securities analysts,
investors and other interested parties to evaluate companies in the
Company's industry. For a reconciliation of the non-GAAP measures
presented in this earnings release to their most directly
comparable financial measure prepared in accordance with GAAP, see
"Non-GAAP Reconciliations" below.
Other companies may define or calculate these measures
differently, limiting their usefulness as comparative measures.
Because of these limitations, non-GAAP financial measures should
not be considered in isolation or as substitutes for performance
measures calculated in accordance with GAAP. Definitions of these
non-GAAP financial measures and reconciliations to the most
directly comparable GAAP financial measures are presented in the
tables below.
The Company defines Adjusted EBITDA as net income (loss) before
(1) interest expense, net, (2) income tax (benefit) expense, (3)
depreciation, (4) amortization of intangible assets, (5)
stock-based compensation expense, (6) unrealized mark-to-market
adjustments and cash transactions related to derivative
instruments, and (7) certain other items, such as
transaction-related items, severance, transformation and other exit
costs and write-off and impairments of goodwill, intangible assets
and other long-lived assets.
Transaction-related items result from actual or potential
transactions such as business combinations, mergers, acquisitions,
dispositions, spin-offs, financing transactions, and other
strategic transactions, including, without limitation, (1)
transaction-related bonuses and (2) expenses for advisors and
representatives such as investment bankers, consultants, attorneys
and accounting firms. Transaction-related items may also include,
without limitation, transition and integration costs such as
retention bonuses and acquisition-related milestone payments to
acquired employees, consulting, compensation and other incremental
costs associated with integration projects, fair value changes to
contingent considerations and amortization of deferred revenue
related to the Accu-Trade acquisition.
The Company defines Free Cash Flow as net cash provided by
operating activities less capital expenditures, including purchases
of property and equipment and capitalization of internally
developed technology.
The Company defines Adjusted Operating Expenses as total
operating expenses adjusted to exclude stock-based compensation,
write-off and impairments of goodwill, intangible assets,
long-lived assets, severance, transformation and other exit costs
and transaction-related items.
Key Metric Definitions
Average Monthly Unique Visitors ("UVs") and Traffic ("Visits").
The Company defines UVs in a given month as the number of distinct
visitors that engage with its platform during that month. Visitors
are identified when a user first visits an individual CARS property
on an individual device/browser combination or installs one of its
mobile apps on an individual device. If a visitor accesses more
than one of its web properties or apps or uses more than one device
or browser, each of those unique property/browser/app/device
combinations counts toward the number of UVs. Traffic is defined as
the number of visits to CARS desktop and mobile properties
(responsive sites and mobile apps). The Company measures UVs and
Traffic via Adobe Analytics. These metrics do not include traffic
to Dealer Inspire websites.
Monthly Average Revenue Per Dealer ("ARPD"). The Company
believes that its ability to grow ARPD is an indicator of the value
proposition of its platform. The Company defines ARPD as Dealer
revenue, excluding digital advertising services, during the period
divided by the monthly average number of Dealer Customers during
the same period. Beginning with the three months ended June 30, 2022, Accu-Trade is included in our ARPD
metric, which had an immaterial impact on ARPD for the quarterly
periods. No prior period has been recast as it would be
impracticable to do so.
Dealer Customers. Dealer Customers represent dealerships using
the Company's products as of the end of each reporting period. Each
physical or virtual dealership location is counted separately,
whether it is a single-location proprietorship or part of a large,
consolidated dealer group. Multi-franchise dealerships at a single
location are counted as one dealer. Beginning June 30, 2022, this key operating metric includes
Accu-Trade; however, no prior period has been recast as it would be
impracticable to do so.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the federal securities laws. All statements other
than statements of historical facts are forward-looking statements.
Forward-looking statements include information concerning the
Company's industry, Dealer Customers, results of operations,
business strategies, plans and objectives, market potential,
outlook, trends, future financial performance, planned operational
and product improvements, potential strategic transactions, recent
acquisitions, such as CreditIQ and Accu-Trade, liquidity, including
draws from the Company's revolving credit facility, expense
management and other matters and involve known and unknown risks
that are difficult to predict. These statements often include words
such as "believe," "expect," "project," "anticipate," "outlook,"
"intend," "strategy," "plan," "estimate," "target," "seek," "will,"
"may," "would," "should," "could," "forecasts," "mission,"
"strive," "more," "goal" or similar expressions. As a result,
the Company's actual financial results, performance, achievements,
strategic actions or prospects may differ materially from those
expressed or implied by these forward-looking statements.
Forward-looking statements are based on the Company's current
expectations, beliefs, strategies, estimates, projections and
assumptions, based on its experience in the industry as well as the
Company's perceptions of historical trends, current conditions,
expected future developments, global supply chain shortages,
fluctuating fuel prices and other factors the Company thinks are
appropriate. Such forward-looking statements are necessarily based
upon estimates and assumptions that, while considered reasonable by
the Company and its management based on their knowledge and
understanding of the business and industry, are inherently
uncertain. These statements are expressed in good faith and the
Company believes these judgments are reasonable. However, you
should understand that these statements are not guarantees of
strategic action, performance or results. The Company's actual
results and strategic actions could differ materially from those
expressed in the forward-looking statements. Given these
uncertainties, forward-looking statements should not be relied on
in making investment decisions. Comparisons of results between
current and prior periods are not intended to express any future
trends, or indications of future performance, unless expressed as
such, and should only be viewed as historical data. Whether or not
any such forward-looking statement is in fact achieved will depend
on future events, some of which are beyond the Company's
control.
Forward-looking statements are subject to a number of risks,
uncertainties and other important factors, many of which are beyond
the Company's control, that could cause its actual results and
strategic actions to differ materially from those expressed in the
forward-looking statements contained in this press release. For a
detailed discussion of many of these and other risks and
uncertainties, see the Company's Annual Report on Form 10-K, its
Quarterly Reports on Form 10-Q, its Current Reports on Form 8-K and
its other filings with the Securities and Exchange Commission,
available on the Company's website at investor.cars.com or via
EDGAR at www.sec.gov. All forward-looking statements contained in
this press release are qualified by these cautionary statements.
You should evaluate all forward-looking statements made in this
press release in the context of these risks and uncertainties. The
forward-looking statements contained in this press release are
based only on information currently available to the Company and
speak only as of the date of this press release. The Company
undertakes no obligation, other than as may be required by law, to
update or revise any forward-looking or cautionary statements to
reflect changes in assumptions, the occurrence of events,
unanticipated or otherwise, or changes in future operating results
over time or otherwise.
The forward-looking statements in this report are intended to be
subject to the safe harbor protection provided by the federal
securities laws.
CARS Investor Relations Contact:
Robbin Moore-Randolph
rmr@cars.com
312.601.5929
CARS Media Contact:
Marita
Thomas
mthomas@cars.com
312.601.5692
Cars.com Inc.
|
Consolidated Statements of
Income
|
(In thousands, except per share
data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenue:
|
|
|
|
|
|
|
|
|
Dealer
|
|
$
153,309
|
|
$
143,987
|
|
$
303,152
|
|
$
284,403
|
OEM and
National
|
|
12,402
|
|
14,144
|
|
25,945
|
|
29,318
|
Other
|
|
2,465
|
|
4,742
|
|
6,147
|
|
7,359
|
Total
revenue
|
|
168,176
|
|
162,873
|
|
335,244
|
|
321,080
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Cost of revenue
and operations
|
|
30,415
|
|
29,504
|
|
60,210
|
|
57,256
|
Product and
technology
|
|
24,956
|
|
23,117
|
|
49,057
|
|
44,424
|
Marketing and
sales
|
|
58,153
|
|
54,655
|
|
116,450
|
|
111,749
|
General and
administrative
|
|
17,649
|
|
17,211
|
|
35,953
|
|
33,771
|
Depreciation and
amortization
|
|
24,669
|
|
23,001
|
|
48,711
|
|
47,554
|
Total operating
expenses
|
|
155,842
|
|
147,488
|
|
310,381
|
|
294,754
|
Operating income
|
|
12,334
|
|
15,385
|
|
24,863
|
|
26,326
|
Nonoperating expense:
|
|
|
|
|
|
|
|
|
Interest
expense, net
|
|
(8,150)
|
|
(9,047)
|
|
(16,394)
|
|
(18,377)
|
Other (expense)
income, net
|
|
(3,133)
|
|
(54)
|
|
5,106
|
|
154
|
Total
nonoperating expense, net
|
|
(11,283)
|
|
(9,101)
|
|
(11,288)
|
|
(18,223)
|
Income before
income taxes
|
|
1,051
|
|
6,284
|
|
13,575
|
|
8,103
|
Income tax
(benefit) expense
|
|
(93,075)
|
|
739
|
|
(92,030)
|
|
(1,782)
|
Net income
|
|
$
94,126
|
|
$
5,545
|
|
$
105,605
|
|
$
9,885
|
Weighted-average common shares
outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
66,762
|
|
69,194
|
|
66,646
|
|
69,329
|
Diluted
|
|
68,493
|
|
70,257
|
|
68,118
|
|
70,505
|
Earnings per share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
1.41
|
|
$
0.08
|
|
$
1.58
|
|
$
0.14
|
Diluted
|
|
1.37
|
|
0.08
|
|
1.55
|
|
0.14
|
Cars.com Inc.
|
Consolidated Balance Sheets
|
(In thousands, except per share
data)
|
|
|
|
|
|
|
|
June 30, 2023
|
|
December 31, 2022
|
Assets:
|
|
(unaudited)
|
|
|
Current assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
28,605
|
|
$
31,715
|
Accounts receivable,
net
|
|
111,237
|
|
107,930
|
Prepaid
expenses
|
|
10,104
|
|
8,377
|
Other current
assets
|
|
7,363
|
|
605
|
Total current
assets
|
|
157,309
|
|
148,627
|
Property and equipment,
net
|
|
45,201
|
|
45,218
|
Goodwill
|
|
102,856
|
|
102,856
|
Intangible assets,
net
|
|
668,771
|
|
707,088
|
Deferred tax assets,
net
|
|
91,255
|
|
48
|
Investments and other
assets, net
|
|
20,151
|
|
21,033
|
Total
assets
|
|
$
1,085,543
|
|
$
1,024,870
|
Liabilities and stockholders'
equity:
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
19,888
|
|
$
18,230
|
Accrued
compensation
|
|
16,343
|
|
19,316
|
Current portion of
long-term debt, net
|
|
16,758
|
|
14,134
|
Other accrued
liabilities
|
|
67,574
|
|
54,332
|
Total current
liabilities
|
|
120,563
|
|
106,012
|
Noncurrent liabilities:
|
|
|
|
|
Long-term debt,
net
|
|
434,210
|
|
458,249
|
Other noncurrent
liabilities
|
|
53,313
|
|
76,179
|
Total noncurrent
liabilities
|
|
487,523
|
|
534,428
|
Total
liabilities
|
|
608,086
|
|
640,440
|
Commitments and
contingencies
|
|
|
|
|
Stockholders' equity:
|
|
|
|
|
Preferred Stock at par,
$0.01 par value; 5,000 shares authorized; no shares
issued and outstanding as of June 30, 2023 and
December 31, 2022,
respectively
|
|
—
|
|
—
|
Common Stock at par,
$0.01 par value; 300,000 shares authorized; 66,477 and
66,287 shares issued and outstanding as of June 30,
2023 and
December 31, 2022, respectively
|
|
665
|
|
662
|
Additional paid-in
capital
|
|
1,499,363
|
|
1,511,944
|
Accumulated
deficit
|
|
(1,022,571)
|
|
(1,128,176)
|
Total stockholders'
equity
|
|
477,457
|
|
384,430
|
Total liabilities and
stockholders' equity
|
|
$
1,085,543
|
|
$
1,024,870
|
Cars.com Inc.
|
Consolidated Statements of Cash
Flows
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
|
|
2023
|
|
2022
|
Cash flows from operating
activities:
|
|
|
|
|
Net income
|
|
$
105,605
|
|
$
9,885
|
Adjustments to
reconcile Net income to Net cash provided by operating
activities:
|
|
|
|
|
Depreciation
|
|
10,394
|
|
7,857
|
Amortization of
intangible assets
|
|
38,317
|
|
39,697
|
Amortization of
Accumulated other comprehensive loss on interest rate
swap
|
|
—
|
|
2,362
|
Changes in fair value
of contingent consideration
|
|
(5,182)
|
|
—
|
Stock-based
compensation
|
|
13,520
|
|
11,628
|
Deferred income
taxes
|
|
(92,587)
|
|
(92)
|
Provision for doubtful
accounts
|
|
1,319
|
|
463
|
Amortization of debt
issuance costs
|
|
1,549
|
|
1,630
|
Amortization of
deferred revenue related to Accu-Trade Acquisition
|
|
(883)
|
|
(1,767)
|
Other, net
|
|
330
|
|
173
|
Changes in operating
assets and liabilities, net of acquisitions:
|
|
|
|
|
Accounts
receivable
|
|
(4,626)
|
|
(4,383)
|
Prepaid expenses and
other assets
|
|
(8,065)
|
|
(6,683)
|
Accounts
payable
|
|
1,658
|
|
(2,422)
|
Accrued
compensation
|
|
(2,973)
|
|
(9,904)
|
Other
liabilities
|
|
(2,194)
|
|
(6,164)
|
Net cash provided by
operating activities
|
|
56,182
|
|
42,280
|
Cash flows from investing
activities:
|
|
|
|
|
Payments for acquisitions,
net of cash acquired
|
|
—
|
|
(64,770)
|
Capitalization of internally
developed technology
|
|
(10,061)
|
|
(7,624)
|
Purchase of property and
equipment
|
|
(508)
|
|
(931)
|
Net cash used in
investing activities
|
|
(10,569)
|
|
(73,325)
|
Cash flows from financing
activities:
|
|
|
|
|
Proceeds from Revolving Loan
borrowings
|
|
—
|
|
45,000
|
Payments of long-term
debt
|
|
(22,500)
|
|
(5,000)
|
Payments for stock-based
compensation plans, net
|
|
(9,069)
|
|
(6,838)
|
Repurchases of common
stock
|
|
(17,154)
|
|
(23,052)
|
Net cash (used in)
provided by financing activities
|
|
(48,723)
|
|
10,110
|
Net decrease in cash
and cash equivalents
|
|
(3,110)
|
|
(20,935)
|
Cash and cash
equivalents at beginning of period
|
|
31,715
|
|
39,069
|
Cash and cash
equivalents at end of period
|
|
$
28,605
|
|
$
18,134
|
Supplemental cash flow
information:
|
|
|
|
|
Cash paid for income
taxes
|
|
$
12,282
|
|
$
629
|
Cash paid for interest
and swap
|
|
15,541
|
|
17,664
|
Cars.com Inc.
|
Non-GAAP Reconciliations
|
(In thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Reconciliation of Net income to Adjusted
EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
94,126
|
|
$
5,545
|
|
$
105,605
|
|
$
9,885
|
Interest expense,
net
|
|
8,150
|
|
9,047
|
|
16,394
|
|
18,377
|
Income tax (benefit)
expense
|
|
(93,075)
|
|
739
|
|
(92,030)
|
|
(1,782)
|
Depreciation and
amortization
|
|
24,669
|
|
23,001
|
|
48,711
|
|
47,554
|
Stock-based
compensation
|
|
7,720
|
|
6,581
|
|
14,672
|
|
11,998
|
Write-off of long-lived
assets and other
|
|
195
|
|
15
|
|
330
|
|
(31)
|
Severance,
transformation and other exit costs
|
|
661
|
|
1,419
|
|
1,878
|
|
1,811
|
Transaction-related
items
|
|
3,203
|
|
(1,043)
|
|
(5,574)
|
|
(486)
|
Adjusted
EBITDA
|
|
$
45,649
|
|
$
45,304
|
|
$
89,986
|
|
$
87,326
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Net cash provided by operating
activities to Free cash flow
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
operating activities
|
|
$
28,041
|
|
$
11,922
|
|
$
56,182
|
|
$
42,280
|
Capitalization of
internally developed technology
|
|
(4,889)
|
|
(4,108)
|
|
(10,061)
|
|
(7,624)
|
Purchase of property
and equipment
|
|
(309)
|
|
(439)
|
|
(508)
|
|
(931)
|
Free cash
flow
|
|
$
22,843
|
|
$
7,375
|
|
$
45,613
|
|
$
33,725
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Operating expenses to Adjusted
operating expenses for the Three Months Ended June 30,
2023:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As Reported
|
|
Adjustments (1)
|
|
Stock-Based
Compensation
|
|
As Adjusted
|
Cost of revenue and
operations
|
|
$
30,415
|
|
$
—
|
|
$
(443)
|
|
$
29,972
|
Product and
technology
|
|
24,956
|
|
—
|
|
(2,372)
|
|
22,584
|
Marketing and
sales
|
|
58,153
|
|
—
|
|
(1,531)
|
|
56,622
|
General and
administrative
|
|
17,649
|
|
(982)
|
|
(3,374)
|
|
13,293
|
Depreciation and
amortization
|
|
24,669
|
|
—
|
|
—
|
|
24,669
|
Total operating
expenses
|
|
$
155,842
|
|
$
(982)
|
|
$
(7,720)
|
|
$
147,140
|
|
|
|
|
|
|
|
|
|
Total nonoperating
expense, net
|
|
$
(11,283)
|
|
$
3,077
|
|
$
—
|
|
$
(8,206)
|
|
|
|
|
|
|
|
|
|
(1) Includes transaction related items,
severance, transformation and other exit costs, and write-off of
long-lived assets and other.
|
|
|
|
|
|
|
|
|
|
Reconciliation of Operating expenses to Adjusted
operating expenses for the Three Months Ended June 30,
2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As Reported
|
|
Adjustments (1)
|
|
Stock-Based
Compensation
|
|
As Adjusted
|
Cost of revenue and
operations
|
|
$
29,504
|
|
$
—
|
|
$
(324)
|
|
$
29,180
|
Product and
technology
|
|
23,117
|
|
—
|
|
(2,092)
|
|
21,025
|
Marketing and
sales
|
|
54,655
|
|
—
|
|
(1,467)
|
|
53,188
|
General and
administrative
|
|
17,211
|
|
(2,031)
|
|
(2,698)
|
|
12,482
|
Depreciation and
amortization
|
|
23,001
|
|
—
|
|
—
|
|
23,001
|
Total operating
expenses
|
|
$
147,488
|
|
$
(2,031)
|
|
$
(6,581)
|
|
$
138,876
|
|
|
|
|
|
|
|
|
|
Total nonoperating
expense, net
|
|
$
(9,101)
|
|
$
(15)
|
|
$
—
|
|
$
(9,116)
|
|
|
|
|
|
|
|
|
|
(1) Includes severance, transformation
and other exit costs, transaction related items, and write-off of
long-lived assets and other.
|
|
|
|
|
|
|
|
|
|
Reconciliation of Operating expenses to Adjusted
operating expenses for the Six Months Ended June 30,
2023:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As Reported
|
|
Adjustments (1)
|
|
Stock-Based
Compensation
|
|
As Adjusted
|
Cost of revenue and
operations
|
|
$
60,210
|
|
$
—
|
|
$
(750)
|
|
$
59,460
|
Product and
technology
|
|
49,057
|
|
—
|
|
(4,429)
|
|
44,628
|
Marketing and
sales
|
|
116,450
|
|
—
|
|
(2,964)
|
|
113,486
|
General and
administrative
|
|
35,953
|
|
(2,899)
|
|
(6,529)
|
|
26,525
|
Depreciation and
amortization
|
|
48,711
|
|
—
|
|
—
|
|
48,711
|
Total operating
expenses
|
|
$
310,381
|
|
$
(2,899)
|
|
$
(14,672)
|
|
$
292,810
|
|
|
|
|
|
|
|
|
|
Total nonoperating
expense, net
|
|
$
(11,288)
|
|
$
(5,182)
|
|
$
—
|
|
$
(16,470)
|
|
|
|
|
|
|
|
|
|
(1) Includes transaction related items,
severance, transformation and other exit costs, and write-off of
long-lived assets and other.
|
|
|
|
|
|
|
|
|
|
Reconciliation of Operating expenses to Adjusted
operating expenses for the Six Months Ended June 30,
2022:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As Reported
|
|
Adjustments (1)
|
|
Stock-Based
Compensation
|
|
As Adjusted
|
Cost of revenue and
operations
|
|
$
57,256
|
|
$
—
|
|
$
(519)
|
|
$
56,737
|
Product and
technology
|
|
44,424
|
|
—
|
|
(3,332)
|
|
41,092
|
Marketing and
sales
|
|
111,749
|
|
—
|
|
(2,772)
|
|
108,977
|
General and
administrative
|
|
33,771
|
|
(3,646)
|
|
(5,375)
|
|
24,750
|
Depreciation and
amortization
|
|
47,554
|
|
—
|
|
—
|
|
47,554
|
Total operating
expenses
|
|
$
294,754
|
|
$
(3,646)
|
|
$
(11,998)
|
|
$
279,110
|
|
|
|
|
|
|
|
|
|
Total nonoperating
expense, net
|
|
$
(18,223)
|
|
$
(185)
|
|
$
—
|
|
$
(18,408)
|
|
(1)
Includes severance, transformation and
other exit costs, transaction related items, and write-off of
long-lived assets and other.
|
View original content to download
multimedia:https://www.prnewswire.com/news-releases/cars-reports-second-quarter-2023-results-301892501.html
SOURCE Cars.com Inc.