Groupon Inc Common Stock (NASDAQ: GRPN) stock rose over 12.66% on June 17th, 2020 (Source: Google finance) and continued its bullish momentum rising over 5% in the pre-market session on June 18th, 2020 (Source: Google finance) after the company posted better than expected results for the first quarter of FY 20. Groupon had lost $213.5 million, in the first quarter of 2020 compared to a net loss of $42.5 million in the first quarter of 2019. The layoffs and furloughs earlier this year due to pandemic are anticipated to result in about $100 million in cost savings this year, and more than $125 million cost savings beginning in 2021. The company had executed phase one of the restructuring plan, as well as a number of additional cost savings and liquidity preservation measures. Once fully implemented multi-phase restructuring plan, the company expects to deliver approximately $225 million in annualized cost savings.
The company has generated negative operating cash flow of $17.6 million for the trailing twelve month period, and negative free cash flow of $78.1 million for the trailing twelve month period. The cash and cash equivalents at the end of March, 2020 were $666.9 million. As of March 31, 2020, the company had $150 million of outstanding borrowings under the $400 million revolving credit facility. In April 2020, the company had borrowed an additional $50 million under the credit facility. The company’s cash balance as of May 31, 2020 was $767.4 million.
GRPN in the first quarter of FY 20 has reported the adjusted loss per share of $1.63, beating the analysts’ estimates for the adjusted loss per share of $1.92, according to analysts polled by FactSet. The company had reported 35 percent fall in the adjusted revenue to $374.2 million in the first quarter of FY 20, beating the analysts’ estimates for revenue of $365 million. Global units sold had declined by 20% to 29.8 million in the first quarter 2020 mainly due to the negative impact of COVID-19 on demand in the month of March and lower Goods sales throughout the quarter. In the first quarter 2020, North America units had declined 13% in Local and down 42% in Goods. International units had declined by 13% in Local and down 22% in Goods. The company has posted the adjusted EBITDA loss of $22.5 million in the first quarter 2020, compared to Adjusted EBITDA of $47.0 million in the first quarter 2019.
In addition, North America gross profit in the first quarter 2020 had fallen by 31% to $143.8 million and International gross profit in the first quarter 2020 fell 40% to $57.5 million (39% FX-neutral), mainly due to the negative impact of COVID-19.