8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 8, 2019

WAGEWORKS, INC.

(Exact name of registrant as specified in charter)

Delaware	001-35232	94-3351864
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

1100 Park Place, 4th Floor

San Mateo, California 94403

(Address of principal executive offices) (Zip Code)

(650) 577-5200

Registrant’s telephone number, including area code

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 (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b))

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.001 par value per share	WAGE	The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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.  ☐

Item 2.02 Results of Operations and Financial Condition.

On August 8, 2019, WageWorks, Inc. (NYSE: WAGE) made available on the “Investors Relations” page of its website at http://www.wageworks.com a slide presentation related to its financial results for the second quarter ended June 30, 2019. A copy of the slide presentation is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information in Item 2.02 and Item 7.01 (including Exhibit 99.1) of this Current Report on Form 8-K is being furnished, not filed, in accordance with the provisions of General Instruction B.2 of Form 8-K. Accordingly, the information in Item 2.02 and Item 7.01 of this Current Report on Form 8-K will not be incorporated by reference in any registration statement filed by the Company under the Securities Act of 1933 unless specifically identified therein as being incorporated therein by reference.

Item 7.01 Regulation FD Disclosure.

The information set forth under Item 2.02 of this Current Report on Form 8-K is incorporated herein by reference.

Non-GAAP Financial Information

In an effort to provide additional and useful information regarding the Company’s financial results and other financial information as determined by generally accepted accounting principles (GAAP), certain materials in Exhibit 99.1 include non-GAAP information. The Company believes the presentation of non-GAAP measures including Total Operating Expenses (excluding excess restatement and merger-related costs), Non-GAAP Operating Income, Adjusted EBITDA, Adjusted EBITDA excluding Restatement and Merger-Related Costs, Adjusted EBITDA Margin, Non-GAAP Net Income, Non-GAAP Earnings Per Share and Net Cash Position provides useful supplemental information to investors with regard to its core operating performance, and are used by the Company’s management to assess the performance of the Company’s business for planning and forecasting in subsequent periods as well as to compare financial results period-over-period. The non-GAAP measures have limitations as analytical tools and you should not consider them in isolation or as a substitute for an analysis of our results under U.S. GAAP. For example, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. A reconciliation of the non-GAAP information to GAAP is available as an appendix to Exhibit 99.1.

Additional Information and Where to Find It

This communication is being made in respect of the proposed transaction involving WageWorks and HealthEquity. In connection with the proposed transaction, WageWorks filed with the SEC a definitive proxy statement, including a form of proxy card, on July 29, 2019. The definitive proxy statement and form of proxy card have been mailed to WageWorks’ stockholders. This communication is not a substitute for the proxy statement or any other document that WageWorks may file with the SEC or send to its stockholders in connection with the proposed transaction. BEFORE MAKING ANY VOTING DECISION, STOCKHOLDERS OF WAGEWORKS ARE URGED TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS IN CONNECTION WITH THE PROPOSED TRANSACTION THAT WAGEWORKS WILL FILE WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT WAGEWORKS AND THE PROPOSED TRANSACTION. The definitive proxy statement and other relevant materials filed in connection with the proposed transaction, and any other documents filed by WageWorks with the SEC, may be obtained free of charge at the SEC’s website (http://www.sec.gov) or at WageWorks’ website (http://www.wageworks.com) or by contacting WageWorks’ Investor Relations at ir@WageWorks.com.

Participants in the Solicitation

WageWorks and its directors and executive officers may be deemed to be participants in the solicitation of proxies from WageWorks’ stockholders with respect to the proposed transaction. Information about WageWorks’ directors and executive officers and their ownership of WageWorks’ common stock is set forth in WageWorks’ proxy statement on Schedule 14A filed with the SEC on July 29, 2019 and WageWorks’ Annual Report on Form 10-K for the fiscal year ended December 31, 2018, which was filed with the SEC on May 30, 2019. Additional information regarding the potential participants, and their direct or indirect interests in the proposed transaction, by security holdings or otherwise, is set forth in the proxy statement and other materials to be filed with SEC in connection with the proposed transaction.

Item 9.01 Exhibits.

(d) Exhibits.

Exhibit No.		Description
	99.1	Supplemental Financial Presentation Q2 2019 dated August 8, 2019.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	WAGEWORKS, INC.
Dated: August 8, 2019	By:	/s/ Ismail Dawood
	Name:	Ismail Dawood
	Title:	Chief Financial Officer

EX-99.1

Supplemental Financial Presentation Q2 2019 August 2019 Exhibit 99.1

Non-GAAP Financial Information In an effort to provide additional and useful information regarding the Company’s financial results and other financial information as determined by generally accepted accounting principles (GAAP), certain materials in this presentation include non-GAAP information. The Company believes the presentation of non-GAAP measures including Total Operating Expenses (excluding excess restatement and merger-related costs), Non-GAAP Operating Income, Adjusted EBITDA, Adjusted EBITDA excluding Restatement and Merger-Related Costs, Adjusted EBITDA Margin, Non-GAAP Net Income, Non-GAAP Earnings Per Share and Net Cash Position provides useful supplemental information to investors with regard to its core operating performance, and are used by the Company's management to assess the performance of the Company’s business for planning and forecasting in subsequent periods as well as to compare financial results period-over-period. The non-GAAP measures have limitations as analytical tools and you should not consider them in isolation or as a substitute for an analysis of our results under U.S. GAAP. For example, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of our non-GAAP financial measures as tools for comparison. A reconciliation of the non-GAAP information to GAAP is available as an appendix to this presentation.

Q2 2019 Income Statement In millions except percentage QTD Q2 2018 QTD Q2 2019 QTD Y/Y Change Total Revenues $117 $109 -7% Healthcare 68 65 -4% COBRA 26 20 -23% Commuter 19 20 5% Other 4 4 0% Total Operating Expenses $100 $106 6% Cost of revenues (excluding amortization of internal use software) 36 $37 3% Technology and development 13 15 15% Sales and marketing 19 18 -5% General and administrative 19 25 32% Amortization 10 11 10% Employee termination and other charges 3 0 -100% Excess Restatement and Merger-Related Costs $3 $11 Total Operating Expenses (excluding excess restatement and merger-related costs)* $97 $95 -2%

Q2 2019 Income Statement (continued) 1. Operating Income excludes stock-based compensation expense, amortization of acquired intangibles and employee termination and other charges. 2. Adjusted EBITDA excludes interest and other income, net, interest expense, income tax provision, depreciation, amortization, stock-based compensation expense, and employee termination and other charges. 3. Adjusted EBITDA Margin reflects Adjusted EBITDA excluding excess Restatement and Merger-Related costs divided by Total Revenue. 4. Non-GAAP Net Income excludes stock-based compensation expense, amortization of acquired intangibles, employee termination and other charges and the tax effect of such adjustments. 5. Earnings Per Share reflects Net Income divided by the weighted-average shares outstanding (diluted). Numbers labeled with a * are Non-GAAP numbersReconciliation of non-GAAP measures can be found in Appendix In millions except percentage QTD Q2 2018 QTD Q2 2019 QTD Y/Y Change Non-GAAP Operating Income* $27 $6 -78% Adjusted EBITDA* $35 $15 -57% Adjusted EBITDA excluding Restatement and Merger-Related Costs* $38 $26 -32% Adjusted EBITDA Margin* 33% 24% Non-GAAP Net Income* $20 $4 -80% Non-GAAP Earnings Per Share* $0.48 $0.11 -78% HSA Statistics       Total Year-to-date HSA Revenue  $7m $10m   Accounts  730K+ 740k+   Cash Balances  $1.1b $1.2b   Annualized Custodial Yield 1.21% 2.04%

Q2 2019 Balance Sheets In millions except percentage December 31, 2018 June 30, 2019 Cash and cash equivalents $898 $807 Total Current Assets $1,246 $1,086 Total Assets $1,785 $1,629 Customer obligations $762 $675 Total Current Liabilities $864 $783 Long-term debt, net of issuance costs $245 $145 Total Liabilities $1,120 $956 Total stockholders' equity $665 $673 Total Liabilities and Stockholders' Equity $1,785 $1,629 Net Cash Position* $137 $158 Change in Net Cash Position   15% Net Cash Position = Total Current Assets – Total Current Liabilities – Long-term debt, net of issuance costs

QTD Restatement and Merger-Related Costs In millions except percentage FY 2017 FY 2018 QTD Q2 2017 QTD Q2 2018 QTD Q2 2019 Finance $13 $26 $3 $4 $7 Legal/other 3 15 1 3 8 Total $16 $41 $4 $7 $15 The above table shows the actual outsourced services costs incurred during the respective periods. The Company estimates that the restatement and merger-related costs are mainly focused on Legal and Finance activities. The excess restatement and merger-related costs are approximately $3 million and $11 million for QTD Q2 2018 and 2019, respectively, compared to QTD Q2 2017.

Appendix: Reconciliation of Non-GAAP Measures

XML

Document and Entity Information	Aug. 08, 2019
Cover [Abstract]
Amendment Flag	false
Entity Central Index Key	0001158863
Document Type	8-K
Document Period End Date	Aug. 08, 2019
Entity Registrant Name	WAGEWORKS, INC.
Entity Incorporation State Country Code	DE
Entity File Number	001-35232
Entity Tax Identification Number	94-3351864
Entity Address, Address Line One	1100 Park Place
Entity Address, Address Line Two	4th Floor
Entity Address, City or Town	San Mateo
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94403
City Area Code	(650)
Local Phone Number	577-5200
Written Communications	false
Soliciting Material	false
Pre Commencement Tender Offer	false
Pre Commencement Issuer Tender Offer	false
Security 12b Title	Common Stock, $0.001 par value per share
Trading Symbol	WAGE
Security Exchange Name	NYSE
Entity Emerging Growth Company	false