Cars.com Inc 8-K, filed Nov 4, 2021

Cars.com Inc. (CARS)

8-K 2021-11-04 For: 2021-11-04

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Added on April 10, 2026

About this 8-K

Cars.com Inc filed this 8-K on November 4, 2021.

Items reported

Item 2.02: Financial results
Item 8.01: Other events

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Delaware	001-37869	81-3693660
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

300 S. Riverside Plaza
Chicago, Illinois		60606
(Address of Principal Executive Offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	CARS	The New York Stock Exchange


Exhibit No.		Exhibit

99.1		Cars.com Inc. Press Release, dated November 4, 2021

99.2		Cars.com Inc. Press Release, dated November 4, 2021

104		Cover Page Interactive Data File (embedded within the Inline XBRL document)


			Cars.com Inc.

Date:	November 4, 2021	By:	/s/ Sonia Jain
			Sonia Jain Chief Financial Officer


Cars.com Inc.
Consolidated Statements of Income (Loss)
(In thousands, except per share data)
(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Revenue:
Dealer	$	139,321		$	123,955		$	409,145		$	332,558
OEM and National		15,273			17,753			49,671			53,167
Other		1,959			2,684			6,562			8,770
Total revenue		156,553			144,392			465,378			394,495
Operating expenses:
Cost of revenue and operations		28,928			25,434			84,978			74,376
Product and technology		20,132			15,455			56,326			42,359
Marketing and sales		51,948			45,776			156,468			132,734
General and administrative		17,919			13,289			46,800			43,866
Affiliate revenue share		—			—			—			10,970
Depreciation and amortization		25,552			25,375			76,530			87,529
Goodwill and intangible asset impairment		—			—			—			905,885
Total operating expenses		144,479			125,329			421,102			1,297,719
Operating income (loss)		12,074			19,063			44,276			(903,224	)
Nonoperating expense:
Interest expense, net		(9,522	)		(10,779	)		(29,362	)		(26,229	)
Other income (expense), net		19			1,957			18			(6,987	)
Total nonoperating expense, net		(9,503	)		(8,822	)		(29,344	)		(33,216	)
Income (loss) before income taxes		2,571			10,241			14,932			(936,440	)
Income tax expense (benefit)		140			22,502			1,257			(112,101	)
Net income (loss)	$	2,431		$	(12,261	)	$	13,675		$	(824,339	)
Weighted-average common shares outstanding:
Basic		69,067			67,295			68,576			67,163
Diluted		70,945			67,295			71,065			67,163
Earnings (loss) per share:
Basic	$	0.04		$	(0.18	)	$	0.20		$	(12.27	)
Diluted		0.03			(0.18	)		0.19			(12.27	)


Cars.com Inc.
Consolidated Balance Sheets
(In thousands, except per share data)

	September 30, 2021			December 31, 2020
	(unaudited)
Assets:
Current assets:
Cash and cash equivalents	$	51,507		$	67,719
Accounts receivable, net		99,233			93,649
Prepaid expenses		9,961			6,491
Other current assets		1,009			10,222
Total current assets		161,710			178,081
Property and equipment, net		46,194			41,323
Intangible assets, net		770,829			835,166
Investments and other assets, net		19,394			21,142
Total assets	$	998,127		$	1,075,712
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable	$	15,738		$	16,512
Accrued compensation		17,952			18,319
Current portion of long-term debt		7,687			7,756
Other accrued liabilities		55,010			47,781
Total current liabilities		96,387			90,368
Noncurrent liabilities:
Long-term debt		470,520			576,143
Deferred tax liability		30,792			30,800
Other noncurrent liabilities		33,868			38,225
Total noncurrent liabilities		535,180			645,168
Total liabilities		631,567			735,536
Commitments and contingencies
Stockholders' equity:
Preferred Stock at par, $0.01 par value; 5,000 shares authorized; no shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively		—			—
Common Stock at par, $0.01 par value; 300,000 shares authorized; 69,025 and 67,387 shares issued and outstanding as of September 30, 2021 and December 31, 2020, respectively		690			674
Additional paid-in capital		1,539,583			1,530,493
Accumulated deficit		(1,170,512	)		(1,184,187	)
Accumulated other comprehensive loss		(3,201	)		(6,804	)
Total stockholders' equity		366,560			340,176
Total liabilities and stockholders' equity	$	998,127		$	1,075,712


Cars.com Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)

	Nine Months Ended September 30,
	2021			2020
Cash flows from operating activities:
Net income (loss)	$	13,675		$	(824,339	)
Adjustments to reconcile Net income (loss) to Net cash provided by operating activities:
Depreciation		12,193			15,085
Amortization of intangible assets		64,337			72,444
Goodwill and intangible asset impairment		—			905,885
Impairment of non-marketable security		—			9,447
Unrealized gain on interest rate swap		—			(2,482	)
Amortization of accumulated other comprehensive income on interest rate swap		4,252			2,101
Stock-based compensation		16,156			10,338
Deferred income taxes		(659	)		(102,199	)
Provision for doubtful accounts		350			3,854
Amortization of debt issuance costs		2,513			2,420
Other, net		722			121
Changes in operating assets and liabilities:
Accounts receivable		(5,933	)		8,814
Prepaid expenses		(3,470	)		(4,089	)
Other current assets		9,240			(9,968	)
Other assets		1,141			819
Accounts payable		(796	)		7,465
Accrued compensation		(367	)		211
Other accrued liabilities		7,229			4,349
Other noncurrent liabilities		(4,357	)		(3,410	)
Net cash provided by operating activities		116,226			96,866
Cash flows from investing activities:
Purchase of property and equipment		(17,879	)		(12,603	)
Net cash used in investing activities		(17,879	)		(12,603	)
Cash flows from financing activities:
Proceeds from revolving loan borrowings		—			165,000
Payments of long-term debt		(107,500	)		(215,312	)
Stock-based compensation plans, net		(7,050	)		(329	)
Payments of debt issuance costs and other fees		(9	)		(3,402	)
Net cash used in financing activities		(114,559	)		(54,043	)
Net (decrease) increase in cash and cash equivalents		(16,212	)		30,220
Cash and cash equivalents at beginning of period		67,719			13,549
Cash and cash equivalents at end of period	$	51,507		$	43,769
Supplemental cash flow information:
Cash (received) paid for income taxes, net of refunds	$	(8,392	)	$	478
Cash paid for interest and interest rate swap		22,687			21,512


Cars.com Inc.
Non-GAAP Reconciliations
(In thousands)
(Unaudited)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
Reconciliation of Net income (loss) to Adjusted EBITDA

Net income (loss)	$	2,431		$	(12,261	)	$	13,675		$	(824,339	)
Interest expense, net		9,522			10,779			29,362			26,229
Income tax expense (benefit)		140			22,502			1,257			(112,101	)
Depreciation and amortization		25,552			25,375			76,530			87,529
Goodwill and intangible asset impairment		—			—			—			905,885
Stock-based compensation		5,623			4,189			16,760			10,476
Write-off of long-lived assets and other		809			(1,922	)		888			7,098
Severance, transformation and other exit costs		1,073			289			2,780			6,457
Transaction-related costs		622			59			1,134			176
Adjusted EBITDA	$	45,772		$	49,010		$	142,386		$	107,410

Reconciliation of Net cash provided by operating activities to Free cash flow

Net cash provided by operating activities	$	36,607		$	39,237		$	116,226		$	96,866
Purchase of property and equipment		(4,784	)		(3,878	)		(17,879	)		(12,603	)
Free cash flow	$	31,823		$	35,359		$	98,347		$	84,263

Reconciliation of Operating expenses to Adjusted operating expenses for the Three Months Ended September 30, 2021:

	As Reported			Adjustments (1)			Stock-Based Compensation			As Adjusted
Cost of revenue and operations	$	28,928		$	—		$	(187	)	$	28,741
Product and technology		20,132			—			(1,323	)		18,809
Marketing and sales		51,948			—			(1,374	)		50,574
General and administrative		17,919			(2,458	)		(2,739	)		12,722
Affiliate revenue share		—			—			—			—
Depreciation and amortization		25,552			—			—			25,552
Goodwill and intangible asset impairment		—			—			—			—
Total operating expenses	$	144,479		$	(2,458	)	$	(5,623	)	$	136,398

Total nonoperating expense, net	$	(9,503	)	$	46		$	—		$	(9,457	)

(1) Includes severance, transformation and other exit costs, write-off of long-lived assets and other and transaction related costs.

Reconciliation of Operating expenses to Adjusted operating expenses for the Three Months Ended September 30, 2020:

	As Reported			Adjustments (1)			Stock-Based Compensation			As Adjusted
Cost of revenue and operations	$	25,434		$	—		$	(165	)	$	25,269
Product and technology		15,455			—			(943	)		14,512
Marketing and sales		45,776			—			(1,010	)		44,766
General and administrative		13,289			(350	)		(2,071	)		10,868
Affiliate revenue share		—			—			—			—
Depreciation and amortization		25,375			—			—			25,375
Goodwill and intangible asset impairment		—			—			—			—
Total operating expenses	$	125,329		$	(350	)	$	(4,189	)	$	120,790

Total nonoperating expense, net	$	(8,822	)	$	—		$	—		$	(8,822	)

(1) Includes severance, transformation and other exit costs, transaction-related costs, and write-off of long-lived assets and other.