Delaware | 000-49799 | 87-0634302 | ||
(State or other jurisdiction of | (Commission File Number) | (I.R.S. Employer | ||
incorporation or organization) | Identification Number) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, $0.0001 par value per share | OSTK | NASDAQ Global Market |
OVERSTOCK.COM, INC. | ||
By: | /s/ JONATHAN E. JOHNSON III | |
Jonathan E. Johnson III | ||
Chief Executive Officer | ||
Date: | April 30, 2020 |
• | Total net revenue was $352 million, a decrease of 4% year over year |
• | Gross profit was $76 million or 21.6% of total revenue, an improvement of 169 basis points year over year |
• | Net loss attributable to stockholders of Overstock.com, Inc. was $16 million, an improvement of $23 million year over year |
• | Net loss per share was $0.40, an improvement of $0.78 year over year |
• | Adjusted EBITDA (non-GAAP) improved by 31% year over year |
• | Net cash used in operating activities was $12 million, an improvement of $39 million year over year |
• | Free cash flow (non-GAAP) improved by $40 million year over year |
• | At the end of the first quarter, cash and cash equivalents totaled $141 million |
• | Retail pre-tax loss was $9 million, an improvement of $4 million year over year |
• | Retail contribution (non-GAAP) was $38 million, or 11.2% of total retail revenue, an improvement of 40 basis points year over year |
• | Retail Adjusted EBITDA (non-GAAP) was ($2) million, an improvement of 24% year over year |
• | tZERO revenue was $10 million, an increase of 128% year over year, primarily due to SpeedRoute trading volume |
• | MVI other income (expense) included an $11 million gain recognized on the deconsolidation of the Medici Land Governance business |
• | Consolidated G&A expenses decreased by $8 million, or 19% year over year, primarily due to a $4 million decrease in consulting expenses and staff-related costs and $3 million in proceeds from a legal settlement |
• | Newly acquired customers increased 9% year over year |
• | Sales from orders placed on a mobile device were 46.3% of total sales in the first quarter of 2020, compared to 43.3% in the first quarter of 2019 |
• | Same day ship confirmations increased 4% in the first quarter of 2020 compared to the same period last year |
• | The number of tZERO Crypto app users increased 40% from December 31, 2019 |
Contacts Investor Relations: Alexis Callahan 801-947-5126 ir@overstock.com | Media: Overstock Media Relations 801-947-3564 pr@overstock.com |
March 31, 2020 | December 31, 2019 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 141,260 | $ | 112,266 | |||
Restricted cash | 2,661 | 2,632 | |||||
Marketable securities at fair value | 3,838 | 10,308 | |||||
Accounts receivable, net | 37,664 | 24,728 | |||||
Inventories, net | 4,678 | 5,840 | |||||
Prepaids and other current assets | 20,783 | 21,589 | |||||
Total current assets | 210,884 | 177,363 | |||||
Property and equipment, net | 126,621 | 130,028 | |||||
Intangible assets, net | 10,837 | 11,756 | |||||
Goodwill | 27,120 | 27,120 | |||||
Equity securities | 53,840 | 42,043 | |||||
Operating lease right-of-use assets | 23,726 | 25,384 | |||||
Other long-term assets, net | 3,707 | 4,033 | |||||
Total assets | $ | 456,735 | $ | 417,727 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 74,254 | $ | 75,416 | |||
Accrued liabilities | 88,457 | 88,197 | |||||
Deferred revenue | 54,143 | 41,821 | |||||
Operating lease liabilities, current | 5,968 | 6,603 | |||||
Other current liabilities | 5,826 | 3,962 | |||||
Total current liabilities | 228,648 | 215,999 | |||||
Long-term debt, net | 43,739 | — | |||||
Operating lease liabilities, non-current | 20,409 | 21,554 | |||||
Other long-term liabilities | 2,284 | 2,319 | |||||
Total liabilities | 295,080 | 239,872 | |||||
Commitments and contingencies | |||||||
Stockholders' equity: | |||||||
Preferred stock, $0.0001 par value, authorized shares - 5,000 | |||||||
Series A-1, issued and outstanding - 4,210 and 4,210 (including 4,085 shares declared as a stock dividend, not yet distributed) | — | — | |||||
Series B, issued and outstanding - 357 and 357 | — | — | |||||
Common stock, $0.0001 par value, authorized shares - 100,000 | |||||||
Issued shares - 43,877 and 42,790 | |||||||
Outstanding shares - 40,326 and 39,464 | 4 | 4 | |||||
Additional paid-in capital | 768,055 | 764,845 | |||||
Accumulated deficit | (596,723 | ) | (580,390 | ) | |||
Accumulated other comprehensive loss | (564 | ) | (568 | ) | |||
Treasury stock at cost - 3,551 and 3,326 | (70,493 | ) | (68,807 | ) | |||
Equity attributable to stockholders of Overstock.com, Inc. | 100,279 | 115,084 | |||||
Equity attributable to noncontrolling interests | 61,376 | 62,771 | |||||
Total stockholders' equity | 161,655 | 177,855 | |||||
Total liabilities and stockholders' equity | $ | 456,735 | $ | 417,727 |
Overstock.com, Inc. Consolidated Statements of Operations (Unaudited) (in thousands, except per share data) | |||||||
Three months ended March 31, | |||||||
2020 | 2019 | ||||||
Revenue, net | |||||||
Retail | $ | 339,598 | $ | 362,625 | |||
Other | 11,975 | 5,104 | |||||
Total net revenue | 351,573 | 367,729 | |||||
Cost of goods sold | |||||||
Retail | 265,392 | 290,640 | |||||
Other | 10,341 | 3,965 | |||||
Total cost of goods sold | 275,733 | 294,605 | |||||
Gross profit | 75,840 | 73,124 | |||||
Operating expenses: | |||||||
Sales and marketing | 36,762 | 33,477 | |||||
Technology | 32,796 | 35,433 | |||||
General and administrative | 32,426 | 40,232 | |||||
Total operating expenses | 101,984 | 109,142 | |||||
Operating loss | (26,144 | ) | (36,018 | ) | |||
Interest income | 272 | 403 | |||||
Interest expense | (200 | ) | (127 | ) | |||
Other income (expense), net | 6,683 | (6,272 | ) | ||||
Loss before income taxes | (19,389 | ) | (42,014 | ) | |||
Provision for income taxes | 176 | 878 | |||||
Net loss | (19,565 | ) | (42,892 | ) | |||
Less: Net loss attributable to noncontrolling interests | (3,232 | ) | (3,648 | ) | |||
Net loss attributable to stockholders of Overstock.com, Inc. | $ | (16,333 | ) | $ | (39,244 | ) | |
Net loss per common share—basic: | |||||||
Net loss attributable to common shares—basic | $ | (0.40 | ) | $ | (1.18 | ) | |
Weighted average common shares outstanding—basic | 40,158 | 32,370 | |||||
Net loss per common share—diluted: | |||||||
Net loss attributable to common shares—diluted | $ | (0.40 | ) | $ | (1.18 | ) | |
Weighted average common shares outstanding—diluted | 40,158 | 32,370 |
Overstock.com, Inc. Consolidated Statements of Cash Flows (Unaudited) (in thousands) | |||||||
Three months ended March 31, | |||||||
2020 | 2019 | ||||||
Cash flows from operating activities: | |||||||
Consolidated net loss | $ | (19,565 | ) | $ | (42,892 | ) | |
Adjustments to reconcile consolidated net loss to net cash used in operating activities: | |||||||
Depreciation of property and equipment | 6,646 | 6,575 | |||||
Amortization of intangible assets | 923 | 1,481 | |||||
Non-cash operating lease cost | 1,630 | 1,667 | |||||
Stock-based compensation to employees and directors | 3,268 | 3,985 | |||||
Deferred income taxes, net | 8 | 895 | |||||
(Gain)/loss on sale of cryptocurrencies | (219 | ) | 9 | ||||
Impairment of cryptocurrencies | 21 | 318 | |||||
Impairment of equity securities | — | 2,958 | |||||
Losses on equity method securities | 2,468 | 1,025 | |||||
Gain on disposal of business | (10,705 | ) | — | ||||
Other non-cash adjustments | 1,625 | 1,858 | |||||
Changes in operating assets and liabilities, net of acquisitions: | |||||||
Accounts receivable, net | (11,141 | ) | 14,068 | ||||
Inventories, net | 1,162 | 554 | |||||
Prepaids and other current assets | 1,542 | 3,106 | |||||
Other long-term assets, net | 457 | (189 | ) | ||||
Accounts payable | (1,310 | ) | (28,023 | ) | |||
Accrued liabilities | 338 | (6,962 | ) | ||||
Deferred revenue | 12,547 | (10,640 | ) | ||||
Operating lease liabilities | (1,751 | ) | (1,249 | ) | |||
Other long-term liabilities | (171 | ) | 27 | ||||
Net cash used in operating activities | (12,227 | ) | (51,429 | ) | |||
Cash flows from investing activities: | |||||||
Purchase of equity securities | (85 | ) | (2,500 | ) | |||
Proceeds from sale of equity securities and marketable securities | 2,179 | 5,535 | |||||
Disbursement for notes receivable | (300 | ) | (2,000 | ) | |||
Acquisitions of businesses, net of cash acquired | — | 4,885 | |||||
Expenditures for property and equipment | (3,638 | ) | (4,144 | ) | |||
Deconsolidation of cash of Medici Land Governance, Inc. | (4,056 | ) | — | ||||
Other investing activities, net | (99 | ) | (2 | ) | |||
Net cash provided by (used in) investing activities | (5,999 | ) | 1,774 | ||||
Continued on the following page | |||||||
Overstock.com, Inc. Consolidated Statements of Cash Flows (Unaudited) (in thousands) | |||||||
Three months ended March 31, | |||||||
2020 | 2019 | ||||||
Cash flows from financing activities: | |||||||
Proceeds from long-term debt | 47,500 | — | |||||
Proceeds from sale of common stock, net of offering costs | 2,848 | 30,957 | |||||
Payments of taxes withheld upon vesting of restricted stock | (1,686 | ) | (1,353 | ) | |||
Other financing activities, net | (1,413 | ) | (648 | ) | |||
Net cash provided by financing activities | 47,249 | 28,956 | |||||
Net increase (decrease) in cash, cash equivalents and restricted cash | 29,023 | (20,699 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of year | 114,898 | 142,814 | |||||
Cash, cash equivalents and restricted cash, end of year | $ | 143,921 | $ | 122,115 | |||
Supplemental disclosures of cash flow information: | |||||||
Cash paid during the period: | |||||||
Interest paid, net of amounts capitalized | $ | 32 | $ | 86 | |||
Income taxes paid, net | 4 | 130 | |||||
Non-cash investing and financing activities: | |||||||
Property and equipment financed through accounts payable and accrued liabilities | $ | 190 | $ | 304 | |||
Common stock repurchased through business combination | — | 643 | |||||
Receivables converted to equity securities | 186 | 359 | |||||
Recognition of ROU Asset and Liabilities for new lease (Operating) | 41 | 30,968 | |||||
Recognition of ROU Asset and Liabilities for new lease (Financing) | 517 | — | |||||
Proceeds from sale of common stock included in accounts receivable | — | 8,957 | |||||
Proceeds from the sale of marketable securities included in accounts receivable | 3,081 | — | |||||
Deposit applied to business combination purchase price | — | 7,347 | |||||
Equity method security applied to business combination purchase price | — | 3,707 |
Three months ended March 31, | |||||||||||||||||||
Retail | tZERO | MVI | Other | Total | |||||||||||||||
2020 | |||||||||||||||||||
Total net revenue | $ | 339,598 | $ | 10,239 | $ | 1,574 | $ | 162 | $ | 351,573 | |||||||||
Cost of goods sold | 265,392 | 8,767 | 1,574 | — | 275,733 | ||||||||||||||
Gross profit | 74,206 | 1,472 | — | 162 | 75,840 | ||||||||||||||
Operating expenses | 82,835 | 12,258 | 2,908 | 3,983 | 101,984 | ||||||||||||||
Interest and other income (expense), net (1) (2) | (299 | ) | (1,782 | ) | 8,833 | 3 | 6,755 | ||||||||||||
Pre-tax income (loss) | $ | (8,928 | ) | $ | (12,568 | ) | $ | 5,925 | $ | (3,818 | ) | (19,389 | ) | ||||||
Provision for income taxes | 176 | ||||||||||||||||||
Net loss (3) | $ | (19,565 | ) | ||||||||||||||||
2019 | |||||||||||||||||||
Total net revenue | $ | 362,625 | $ | 4,496 | $ | 608 | $ | — | $ | 367,729 | |||||||||
Cost of goods sold | 290,640 | 3,357 | 608 | — | 294,605 | ||||||||||||||
Gross profit | 71,985 | 1,139 | — | — | 73,124 | ||||||||||||||
Operating expenses | 85,336 | 15,553 | 4,253 | 4,000 | 109,142 | ||||||||||||||
Interest and other income (expense), net (1) | 135 | (963 | ) | (5,164 | ) | (4 | ) | (5,996 | ) | ||||||||||
Pre-tax loss | $ | (13,216 | ) | $ | (15,377 | ) | $ | (9,417 | ) | $ | (4,004 | ) | (42,014 | ) | |||||
Provision for income taxes | 878 | ||||||||||||||||||
Net loss (3) | $ | (42,892 | ) |
(1) | Excludes intercompany transactions eliminated in consolidation, which consist primarily of service fees and interest. The net amounts of these intercompany transactions were $1.1 million and $415,000 for the three months ended March 31, 2020 and 2019, respectively. |
(2) | Upon deconsolidation of Medici Land Governance, we recognized our retained equity interest in Medici Land Governance as an equity method security held by our MVI segment which resulted in a $10.7 million gain included in Interest and other income (expense), net for our MVI segment for the three months ended March 31, 2020. |
(3) | Net loss presented for segment reporting purposes is before any adjustments attributable to noncontrolling interests. |
Three months ended March 31, | |||||||
2020 | 2019 | ||||||
Net loss | $ | (19,565 | ) | $ | (42,892 | ) | |
Depreciation and amortization | 7,569 | 6,614 | |||||
Stock-based compensation | 3,268 | 3,985 | |||||
Interest income, net | (72 | ) | (276 | ) | |||
Other (income) expense, net | (6,683 | ) | 6,272 | ||||
Provision for income taxes | 176 | 878 | |||||
Special items (see table below) | (1,103 | ) | 1,757 | ||||
Adjusted EBITDA | $ | (16,410 | ) | $ | (23,662 | ) | |
Segment Adjusted EBITDA | |||||||
Retail | $ | (1,865 | ) | $ | (2,460 | ) | |
tZERO | (8,250 | ) | (13,207 | ) | |||
MVI | (2,498 | ) | (4,008 | ) | |||
Other | (3,797 | ) | (3,987 | ) | |||
Adjusted EBITDA | $ | (16,410 | ) | $ | (23,662 | ) | |
Special items: | |||||||
Severance | $ | 1,398 | $ | 1,757 | |||
Gain on legal settlement | (2,501 | ) | — | ||||
$ | (1,103 | ) | $ | 1,757 |
Three months ended March 31, | |||||||
2020 | 2019 | ||||||
Net cash used in operating activities | $ | (12,227 | ) | $ | (51,429 | ) | |
Expenditures for property and equipment | (3,638 | ) | (4,144 | ) | |||
Free cash flow | $ | (15,865 | ) | $ | (55,573 | ) |
Three months ended March 31, | |||||||||||
Retail | Other (1) | Total | |||||||||
2020 | |||||||||||
Total net revenue | $ | 339,598 | $ | 11,975 | $ | 351,573 | |||||
Cost of goods sold | 265,392 | 10,341 | 275,733 | ||||||||
Gross profit | 74,206 | 1,634 | 75,840 | ||||||||
Less: Sales and marketing expense | 36,290 | 472 | 36,762 | ||||||||
Contribution | $ | 37,916 | $ | 1,162 | $ | 39,078 | |||||
Contribution margin | 11.2 | % | 9.7 | % | 11.1 | % | |||||
2019 | |||||||||||
Total net revenue | $ | 362,625 | $ | 5,104 | $ | 367,729 | |||||
Cost of goods sold | 290,640 | 3,965 | 294,605 | ||||||||
Gross profit | 71,985 | 1,139 | 73,124 | ||||||||
Less: Sales and marketing expense | 32,933 | 544 | 33,477 | ||||||||
Contribution | $ | 39,052 | $ | 595 | $ | 39,647 | |||||
Contribution margin | 10.8 | % | 11.7 | % | 10.8 | % |
(1) | Other includes our tZERO, MVI, and Other segments. |
=NSCK]Q:^EJ]6A6C7IJI#9GYGF^5U\EQM3 8FW/"U[;:I
M/RZ,6BBBMSQPHHHH **** "BBB@ HHHH **** "BBB@ HHHH **** "BBB@
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M*.*Y#Z4**0XKM/!OP7\$((WA_PS?7T+@LMP4\J!L>DK[5)]LUI"G.H[05S
MAQ6-PN!A[3%5%"/>327XG&?A17T;H_[!OQ%U"&"6\N-'TP.,O#+<.\L?MA$*
MDCV:NH_X=YZYY&[_ (2ZR\W^Y]C?'7UW>GM7-/$UN7
MT*UE_P!!LY =MW(IY=O6-2,8_B8$'@$-4\?_ LN?C!^V5K^@)NCL_/BGOIU
MZQ6ZP1;B#ZG(4>[ ],U][Z+I%IH&DVFFV%O':V5K$L,,,8PJ(H ]@*^9PN
M"57$SK3V3=OO/Z+XFXMGEO#^"RG!2M4G2AS-?9CRK3U?X+U*'C+Q5IW@/PIJ
M6N:E((K'3X&FDQ@$X'"KGJQ. !W) K\H/'_CC4/B1XQU/Q%JCEKJ^E+[,Y$:
M=%C'LJX'OC-?97[?_CJ32_!^B>%[>1E.K3M/<[3P8H<$*?J[(?\ @!KX3X[5
MRYQB'*HJ*V6Y]#X4Y''#X&>;55[]1VCY13U^]_DAU%)Q1Q7SA^^"T4G%'% !
M^=?HQ^QI\9)?B1\/7TC4IS-KFA;()9')+30$?NI"2.3\K*>2?DR?O5^P?
MLH>.F\!_&W0G9RMIJC_V9<*!G=YA 3_R((^>PS7K9;B'0KI=):'YIQ_D<,YR
M6I)+]Y2]^+]-U\U^-C]/ZBN(5N(7B&Q51WDXV
M?K'W6_P/LO\ X)S_ /'Q\0/]VP_G<5]JU\5?\$Y_^/CX@?[MA_.XK[5K['+?
M]TA\_P V?RAXB?\ )3XO_MW_ -(B
OY\?@_P#$W4/@U\1=
M(\::2BOJVD^;+9F0 JDYA=(W8$$$*S*Q4]=I'&