2023 Q2 Form 10-Q Financial Statement

#000137128523000146 Filed on May 05, 2023

View on sec.gov

Income Statement

Concept 2023 Q2 2023 Q1 2022 Q4
Revenue $270.6M $256.3M $246.0M
YoY Change 23.31% 24.43% 26.56%
Cost Of Revenue $241.2M $230.0M $212.4M
YoY Change 26.39% 30.59% 29.61%
Gross Profit $29.37M $26.35M $33.65M
YoY Change 2.76% -11.87% 10.2%
Gross Profit Margin 10.86% 10.28% 13.68%
Selling, General & Admin $33.91M $42.66M $33.03M
YoY Change 5.27% 37.64% 14.52%
% of Gross Profit 115.43% 161.92% 98.16%
Research & Development $5.232M $4.900M $6.955M
YoY Change -18.2% -6.29% 49.09%
% of Gross Profit 17.81% 18.6% 20.67%
Depreciation & Amortization $3.253M $3.202M $2.897M
YoY Change 20.17% 17.85% 4.58%
% of Gross Profit 11.07% 12.15% 8.61%
Operating Expenses $42.39M $50.76M $42.88M
YoY Change 2.61% 30.36% 18.21%
Operating Profit -$13.09M -$24.49M -$9.232M
YoY Change 2.5% 168.66% 60.81%
Interest Expense $2.940M $2.387M -$1.672M
YoY Change 146.44% 2921.52% 5293.55%
% of Operating Profit
Other Income/Expense, Net $2.078M $1.902M $1.504M
YoY Change 469.32% 505.73% -737.29%
Pretax Income -$13.95M -$24.97M -$9.300M
YoY Change 2.6% 181.24% 54.79%
Income Tax -$238.0K -$191.0K -$15.00K
% Of Pretax Income
Net Earnings -$13.71M -$24.78M -$9.285M
YoY Change 0.7% 179.84% 31.85%
Net Earnings / Revenue -5.07% -9.67% -3.77%
Basic Earnings Per Share -$0.33 -$0.60
Diluted Earnings Per Share -$0.33 -$0.60 -$0.23
COMMON SHARES
Basic Shares Outstanding 41.23M shares 41.02M shares 40.88M shares
Diluted Shares Outstanding 41.38M shares 41.11M shares

Balance Sheet

Concept 2023 Q2 2023 Q1 2022 Q4
SHORT-TERM ASSETS
Cash & Short-Term Investments $236.1M $244.6M $222.4M
YoY Change -2.87% -5.56% 4.22%
Cash & Equivalents $118.4M $126.7M $65.61M
Short-Term Investments $117.6M $117.9M $156.8M
Other Short-Term Assets $18.88M $17.49M $14.25M
YoY Change 23.83% 20.73% 15.6%
Inventory
Prepaid Expenses
Receivables $265.6M $248.2M $232.4M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $520.6M $510.4M $469.1M
YoY Change 12.55% 10.33% 19.99%
LONG-TERM ASSETS
Property, Plant & Equipment $97.98M $94.47M $90.70M
YoY Change 17.99% 17.55% 16.36%
Goodwill $43.88M $43.03M $41.98M
YoY Change 49.22% 35.34% 28.35%
Intangibles $21.63M $23.02M $24.03M
YoY Change 9.49% 8.0% 6.04%
Long-Term Investments $9.818M $8.440M $300.0K
YoY Change 3172.67% 2713.33% 0.0%
Other Assets $18.15M $19.54M $18.94M
YoY Change -5.68% 10.28% 6.57%
Total Long-Term Assets $209.6M $207.6M $202.5M
YoY Change 21.41% 20.63% 18.01%
TOTAL ASSETS
Total Short-Term Assets $520.6M $510.4M $469.1M
Total Long-Term Assets $209.6M $207.6M $202.5M
Total Assets $730.2M $717.9M $671.6M
YoY Change 14.96% 13.13% 19.38%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $6.918M $7.384M $9.471M
YoY Change 6.81% 27.42% 5.8%
Accrued Expenses $29.89M $29.56M $32.62M
YoY Change -4.11% -0.63% 15.82%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $1.100M $1.263M $1.103M
YoY Change 80.62% 107.39%
Total Short-Term Liabilities $330.7M $312.0M $289.6M
YoY Change 27.08% 27.01% 29.47%
LONG-TERM LIABILITIES
Long-Term Debt $102.9M $102.9M $68.35M
YoY Change 91.96% 91.82%
Other Long-Term Liabilities $4.901M $5.024M $4.968M
YoY Change 18.87% 23.68% 28.74%
Total Long-Term Liabilities $107.8M $108.0M $4.968M
YoY Change 86.74% 87.03% 28.74%
TOTAL LIABILITIES
Total Short-Term Liabilities $330.7M $312.0M $289.6M
Total Long-Term Liabilities $107.8M $108.0M $4.968M
Total Liabilities $441.4M $423.1M $366.3M
YoY Change 37.77% 38.23% 59.01%
SHAREHOLDERS EQUITY
Retained Earnings -$210.1M -$196.3M -$171.6M
YoY Change 40.63% 44.64% 35.21%
Common Stock
YoY Change
Preferred Stock
YoY Change
Treasury Stock (at cost) $16.53M $16.53M $16.53M
YoY Change 0.02% 53.39% 53.39%
Treasury Stock Shares 1.028M shares
Shareholders Equity $288.8M $294.8M $305.3M
YoY Change
Total Liabilities & Shareholders Equity $730.2M $717.9M $671.6M
YoY Change 14.96% 13.13% 19.38%

Cashflow Statement

Concept 2023 Q2 2023 Q1 2022 Q4
OPERATING ACTIVITIES
Net Income -$13.71M -$24.78M -$9.285M
YoY Change 0.7% 179.84% 31.85%
Depreciation, Depletion And Amortization $3.253M $3.202M $2.897M
YoY Change 20.17% 17.85% 4.58%
Cash From Operating Activities -$3.405M -$6.862M $1.019M
YoY Change 8.79% 91.14% -80.24%
INVESTING ACTIVITIES
Capital Expenditures $4.735M $5.184M $5.478M
YoY Change -220.61% 45.9% -243.48%
Acquisitions
YoY Change
Other Investing Activities -$794.0K -$100.0K -$25.07M
YoY Change -88.59% -2100.0% 53.94%
Cash From Investing Activities -$5.529M $33.91M -$30.55M
YoY Change -49.21% -337.98% 51.95%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -93.00K $33.81M 14.68M
YoY Change -98.45% -35.92% -3355.43%
NET CHANGE
Cash From Operating Activities -3.405M -$6.862M 1.019M
Cash From Investing Activities -5.529M $33.91M -30.55M
Cash From Financing Activities -93.00K $33.81M 14.68M
Net Change In Cash -9.027M $61.12M -14.85M
YoY Change -54.89% 74.32% -3.57%
FREE CASH FLOW
Cash From Operating Activities -$3.405M -$6.862M $1.019M
Capital Expenditures $4.735M $5.184M $5.478M
Free Cash Flow -$8.140M -$12.05M -$4.459M
YoY Change -1122.61% 68.64% -149.69%

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Nature of Operations and Significant Accounting Policies<div style="margin-bottom:5pt;margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Description of Business and Basis of Presentation</span></div><div><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:115%">Trupanion, Inc. (collectively with its wholly-owned subsidiaries, the "Company") provides medical insurance for cats and dogs throughout the United States, Canada, Europe, Puerto Rico, and Australia. The Company's data-driven, vertically-integrated approach enables the Company to provide pet owners with products that the Company believes are the highest value medical insurance, priced specifically for each pet’s unique characteristics. </span></div><div style="margin-bottom:5pt;margin-top:5pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The financial data as of December 31, 2022 was derived from the Company's audited consolidated financial statements. The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) and, in management's opinion, have been prepared on the same basis as the audited financial statements and include all adjustments, consisting of normal recurring adjustments, necessary for the fair presentation of the Company's financial position, results of operations, comprehensive income (loss), stockholders' equity and cash flows for the interim periods. These unaudited interim consolidated financial statements should be read in conjunction with the Company’s audited financial statements included in the Company’s Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (SEC) on February 16, 2023 (the 2022 10-K). The Company's accounting policies are described in Note 1 to the audited financial statements included in the 2022 10-K. Operating results for the three months ended March 31, 2023 are not necessarily indicative of the results that may be expected for the full fiscal year or any other interim period.</span></div><div style="margin-bottom:5pt;margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Use of Estimates</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from such estimates. See Note 1 to the audited financial statements included in the 2022 10-K for additional discussion of these estimates and assumptions.</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Accounts and Other Receivabl</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">es </span></div>Receivables are comprised of trade receivables and other miscellaneous receivables. Accounts and other receivables are carried at their estimated collectible amounts. Accounts receivable balance is primarily related to the Company’s other business segment where the Company generates revenue from underwriting policies through unaffiliated general agents. During the three months ended March 31, 2023, the Company incurred a non-recurring $3.8 million settlement of accounts receivable due to uncollected premiums in connection with the transition of underwriting a third-party business to other insurers.
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<div style="margin-bottom:5pt;margin-top:9pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Use of Estimates</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from such estimates. See Note 1 to the audited financial statements included in the 2022 10-K for additional discussion of these estimates and assumptions.</span></div><div style="margin-top:5pt"><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-style:italic;font-weight:700;line-height:120%">Accounts and Other Receivabl</span><span style="color:#000000;font-family:'Times New Roman',sans-serif;font-size:10pt;font-weight:400;line-height:120%">es </span></div>Receivables are comprised of trade receivables and other miscellaneous receivables. Accounts and other receivables are carried at their estimated collectible amounts. Accounts receivable balance is primarily related to the Company’s other business segment where the Company generates revenue from underwriting policies through unaffiliated general agents. During the three months ended March 31, 2023, the Company incurred a non-recurring $3.8 million settlement of accounts receivable due to uncollected premiums in connection with the transition of underwriting a third-party business to other insurers.
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