Q3 2021 Waitr Holdings Inc Earnings Call

Good afternoon, everyone I would like to welcome all of you did a waiter Holdings, Inc. Third quarter 2021 conference call with US today are we just chief Executive Officer, Cochrane Stat, and Chief Financial Officer, Leo booked enough by now you should have access to the company's earning press release.

If not it may be found at SEC Gov, or the Investor Relations website at investors don't wait till after the dot com before I turn the call over to the management I would like to remind you that certain statements and projections in this call about future business and financial results constitute forward looking statements. These statements are based.

On management's current business and market expectations and actual results could differ materially from those projected in the forward looking statements. Please see Eddie please see the risk factors contained in the company's annual report on Form 10-K and in your form 10 Qs for the discussion of risks that may cause actual results to vary from these forward looking.

<unk> statements.

Finally, please note that on todays call management may refer to non G. A a P financial measure this referred to waitress third quarter 2021 earnings release for full because delineation of its non G. A a P financial measures to the most comparable G. A a P financial measures.

I would like to now turn the call over to wait to see Oh call Group, Scott, who will give you an overview of the companys business activities under about men, but the third quarter of 2021. He will then turn the call over to Leo booked enough, who will provide an overview of the company's operating and financial results. We will then open the call for Q&A call.

Please go ahead.

Thank you Hello, everyone and welcome to the third quarter earnings call.

In the third quarter of 2021, we had several hurricanes hit our core southeast markets and we are continuing to recover from these events. However, we have remained nimble and despite these adverse weather related events, we have sequentially increased EBITDA from.

From last quarter, primarily as a result of increased operational efficiencies.

We continue to methodically deploy our capital in various initiatives in order to position the company for long term growth.

These include investments in our technology platform with new product offerings expansion through the acquisition of complementary.

Businesses and solidify a key partnership opportunities within our industry.

We recently broadened our partnership with O L. A major digital food ordering platform for the restaurant industry by joining their dispatch network.

This offering enables us to access a wider universe of restaurants, and diners by utilizing our logistics network to fulfill incremental orders generated through the restaurants own websites and apps. We believe these continued integration are key and solidify our presence in the on demand delivery.

Sector.

During the quarter. We also closed the acquisitions of flow payments pro merchant and Cape Cod merchant services three payments companies that provide services in the space of merchant processing.

The acquisition of these businesses is an important milestone in our growth strategy to broaden our company's capabilities and diversify its revenue streams beyond third party food delivery.

Our goal is to continue to expand our ecosystem, which today is comprised of restaurants diners and independent contract drivers and the product and services that we offer to these constituents.

We are excited to build on this ever expanding ecosystem and being able to add a full suite of fundamental payment processing solutions to our current service offering.

As we near the end of fiscal 2021, we are continuing to focus on fundamental strategic initiatives and realize efficiencies within our core operational processes.

Now I'll turn it over to Leo our Chief Financial Officer for a recap of the third quarter results.

Thank you Carl.

Then I'll review, our third quarter 2021 financial results.

Revenue for the third quarter of 2021 was $43 4 million compared to $52 7 million in the third quarter of 2020.

Nine months ended September 32021 revenue was $143 5 million compared to $157 5 million in the nine months ended September 32020.

Adjusted EBITDA for the third quarter of 2021 was $3 1 million.

Compared to $2 5 million in the second quarter of 2021 13 million in the third quarter of 2020.

Net income for the third quarter of 2021 was $12 3 million compared to $4 6 million in the third quarter of 2020.

Net income per share for the third quarter of 2021 was nine cents compared to net income per share of <unk> for the third quarter of 2020.

Cash on hand totaled $43 5 million as a temporary 30 of 2021.

Total outstanding long term debt as of September 30th 2021 was $84 5 million, consisting primarily of our $35 million term loans $49 5 million of convertible notes.

That concludes the recap of our third quarter 2021 financial results well now going through a short Q&A session.

Thank you.

Ladies and gentlemen, if you would like to ask a question. Please signal by pressing star one on your telephone keypad. If you are using a speakerphone. Please make sure. Your mute function is turned off to allow your signal to me shall equipment. Once again. Please press star one to ask a question, we'll pause for just a moment to allow everyone an opportunity to signal.

Well take our first question from Alex Fuhrman from Craig Hallum Capital Group. Your line is open. Please go ahead.

Great. Thank you very much for taking my question and.

Got him all of the Hurricanes happened certainly hope all of your employees and driver then and their families are managing well.

I'll be back for the recovery.

I have to ask about.

As a company.

Through through all of those turbulent times, obviously, Louisiana the huge market for you.

I think that the that Q3 profitability was actually even better than Q2 despite.

Really.

Correct.

That hurricane.

You know New Orleans, and the rest of Louisiana.

Can you talk about where some of those operating efficiencies are causing problems for you Matt.

But the ramp up in profit from Q2 to Q3 would've been even even battery. It you know we had a more kind of historical norm Hurricanes would be then in Q3 can you give us a little bit more color on where that's coming from it looks like just on the income statement really strong leverage out of.

Operations and support any any color on on what's really driving that would be helpful.

It's really across the board its head count.

Mostly.

And you know, it's a little bit tricky.

You know, our 18 month or so.

History with the business has been.

Now to merchant tumultuous right we've had the COVID-19.

Pandemic, we've had all of these storms and it's it's tricky.

<unk> your order flow to you know, what's the proper head count and support Foundation.

To satisfy the demand and we've had the all of these outside forces whether it's.

An act of God like a hurricane or an act of the federal government in the form of subsidies and I've always said from the beginning these markets that we're in.

Covid was one dynamic, but the the individual diner and his economic wellbeing really drives this business. So you think about what happens in the disruption of the storm you have the initial disruption like restaurants are closed didn't grow.

Or would you not passable and you had power outages and what have you then you have the very lasting impacts.

There you know people.

Might leave the area for a period of time, they have homes that they can't live in and you know there.

You know there are financial budgets are constrained.

And you know more than likely there, they're fixing the roof and instead of ordering chicken wings. So you know, it's hard to even Alex to quantify the impact in the quarter, because I think we're still feeling it so to speak.

But.

You know a high marks to our team because we anticipated that there would be a lasting effect from these storms and we were proactive in looking at our expense levels and head count and adjusted very rapidly and I think we'll continue to see that.

Benefits of that pull through as as we finish out the year.

Okay. Thanks, Karl that that's helpful. And then wanted to ask about your.

Your M&A strategy either dumper.

You've made recently can you talk about what some of these target bringing to wait or is it about capabilities that are more efficient to buy than build you know without giving away too much of the secret sauce would love to kind of get a sense of of how some of these acquired assets could could play into your strategy next year.

Yes. So you just think about our strategy and it is very definitely obvious to me that the.

Our our equity is going to trade on events right. It's not gonna be pulled forward on any given day because you know we did a couple of thousand extra orders in the quarter right, it's going to be.

Event, driven with us executing on the strategy that I've outlined a number of times and that is we have this ecosystem diners drivers.

Merchants, if you will right now restaurants right.

90, plus percent of our revenue comes from delivering prepared foods, we are going to sell these constituents more products basic products right. So the acquisition and we're going to be more diverse in the verticals that we've talked in the past about alcohol it.

Convenience and what have you.

But there are several verticals that we think.

Uh huh.

You have less competition and we can apply our core competencies, which very definitely our last mile delivery. We've proven that we can deliver things in less than an hour profitably we come from the payments world.

Acquisitions is it through three payments companies give us the capability.

To attack, our existing base of restaurants with a full suite of payment products.

Not to mention they have within their own businesses footholds in other verticals that we can apply our core competency of last mile delivery to as well.

So that's where I'm focused right I'm focused on expanding that group of constituents and enhancing the platform. So that we have other basic products and services to sell into.

That group of constituents.

Okay. Thanks for that call that that's helpful. Looking forward to seeing what some of those vertical bar.

Yeah.

Hi, Leo we have no further question at this time, which like for me to give one more prompt.

I think we're if there aren't any other questions. We can conclude the call. Thanks again.

If there any follow up questions.

Questions. Please submit them to our Investor relations of our website.

Thank you again.

That concludes today's conference call. Thank you everyone for your participation you may now disconnect.

[music].

Yeah.

Okay.

Yeah.

[music].