Wag! Group Co. (“The Company” or “Wag!”; Nasdaq: PET), an American
pet services marketplace company powering a mobile-first technology
platform that enables on-demand and scheduled dog walking,
overnight care, training, and other pet care services, today
reported results for its second quarter, which ended on June 30,
2022.
“Our strong financial performance in the second quarter was
driven by our highly rated, mobile-first platform that is
transforming the pet health and wellness space. Our
subscription-based pet care platform simplifies access to premium
services for all pet owners, reflected by our exceptional revenue
growth in the second quarter,” said Garrett Smallwood, CEO of
Wag!.
“We are confident in our growth strategy to become the number
one subscription-based pet care platform, as we consolidate the
highly fragmented pet industry onto the phone. We believe we are
just getting started in an industry that has no signs of slowing
down and remain laser-focused on growth, our path to profitability,
and providing an unparalleled user experience, all working towards
delivering long term shareholder value,” concluded Smallwood.
Second Quarter 2022 Highlights:
- Revenue increased
256% to $12.8 million, compared to $3.6 million in the second
quarter of 2021.
- Net loss improved to $(1.1) million from
$(2.4) million in second quarter of 2021.
- Adjusted EBITDA improved to a loss of $(0.9)
million from a loss of $(2.3) million in second quarter 2021.
- Gross Bookings increased 124% to $22.0
million, compared to $9.8 million in second quarter of 2021.
Recent Business Highlights:
- Completed its successful Business
Combination on August 9, 2022 and began trading on NASDAQ under the
ticker PET on August 10, 2022.
- Increased active Pet Parent Wag! Premium penetration
year-over-year from 34% to 50%, which is exceedingly bullish as Pet
Parents who subscribe to Wag! Premium are paying an additional
$9.99 per month and signaling their intent to increase their Wag!
usage.
- Improved the take rate to 58% in the second quarter 2022,
driven by increased Wag! Premium penetration and continued
diversification of the platform including significant growth in the
Wellness category.
- Achieved LTV:CAC ratio of 8:1 during the Q2’22 period.
- Reached a total of 387,000 Platform Participants in Q2’22.
- Launched partnerships with Tractor Supply, Petsense, and
Kimpton Hotels & Restaurants.
- Innovated on the Pet Caregiver experience — including
optimizing the sign-up experience, in-app viral sharing, and third
party systems.
Full-Year 2022 Guidance
Wag! Is raising its guidance for the year ending December 31,
2022, as previously presented in its First Quarter 2022 Earnings
Release and Investor Presentation available at
investors.wag.co/news-events/overview:
For the full-year of 2022, we now expect:
- Revenue in the range
of $47.5 million to $49.0 million, a 15.4% improvement versus our
prior forecast at the midpoint of the range.
- Adjusted EBITDA loss in the range of $8.0
million to $10.0 million, a 42% improvement versus our prior
forecast at the midpoint of the range.
Our financial guidance includes the following assumptions:
- A continued trend in return-to-office,
as measured by the Kastle back-to-work barometer.
- A normalized travel season.
- Continued acceleration in Wellness and stickiness in Wag!
Premium as a result of marketing efficiency.
- Taking into account the macro environment, a modest impact to
existing consumer demand as a result of inflationary concerns
specific to considered purchases and services, as well as a modest
impact to caregiver engagement as a function of gas prices.
Kimberly A. Blackwell and Sheila Lirio Marcelo Elected
to Board of Directors
The company announced that its Board of Directors elected
Kimberly A. Blackwell and Sheila Lirio Marcelo to the Board on
August 10, 2022. The size of the Board was increased to 7 with the
election of Ms. Blackwell and Ms. Lirio Marcelo.
Kimberly A. Blackwell is heralded as one of the
country’s top executives in new media, digital transformation,
marketing and advertising. As CEO of PMM, a nationally recognized
omni-channel brand agency, Ms. Blackwell is a trusted advisor to
the C-Suite for the world’s largest brands of the Fortune 100.
Experienced also in areas of scale for high-growth companies, Ms.
Blackwell is a founding member and Advisor to blank check company,
Legacy Acquisition Corp, the largest African-American led SPAC and
now publicly traded (NYSE). She also currently serves as an
Advisory Board member to CollabCapital. A sitting Director of the
Executive Leadership Council (ELC), a network of the nation’s most
influential African-American executives of the Fortune 500, member
of the Gucci, Inc. Changemaker Council, lifetime member of the
National Black MBA Association (NBMBAA), Ms. Blackwell is one of
eight female CEOs chosen to sit on the National Women’s Business
Council (NWBC) as an advisor to the President, Congress, and SBA to
drive scale, public policy, and advocacy for female business
enterprises.
Sheila Lirio Marcelo is the Co-Founder and CEO
of Proof of Learn, a Web3 learning platform with a mission to
unlock accessible, high-quality education across the world. She
also currently serves as a Venture Partner at New Enterprise
Associates (NEA). Ms. Marcelo previously founded Care.com in 2006,
where she was Chairwoman and CEO until early 2020, when the company
was sold to IAC. She is a Henry Crown Fellow with the Aspen
Institute, a Young Global Leader of the World Economic Forum, was
awarded a Marshall Memorial Fellowship and is a member of the
Council on Foreign Relations.
The Board of Directors now includes:
- Garrett Smallwood, Chief Executive Officer and Chairman of the
Board of Wag!
- Jocelyn Mangan, CEO & Founder of Him For Her and Lead
Independent Director of Wag!
- Melinda Chelliah, CEO of Tailored for Growth
- Sheila Lirio Marcelo, Co-Founder and CEO of Proof Of Learn,
previously Founder and CEO of Care.com
- Kimberly A. Blackwell, CEO of omni-channel brand agency
PMM
- Roger Lee, General Partner of Battery Ventures
- Brian Yee, Partner of ACME Capital
“We’re excited to have Kimberly and Sheila join our Board. They
each bring strong operational and management experience that will
serve as valuable assets to the Company,” said Garrett Smallwood,
CEO.
Wag’s Second Quarter Results Conference
CallWag! will host a conference call and live webcast
today, August 16, 2022, at 8:00 a.m. ET to discuss financial
results. To access the live conference call, please
pre-register here. Registrants will receive a confirmation
with dial-in instructions. A live webcast of the call can be
accessed by using this link. Following the live call, an archived
webcast of the conference will be available on the investor
relations page of the Company’s website at Wag! – Investor
Relations.
About Wag! – Wag.co
Wag! strives to be the #1 platform for busy pet parents,
offering access to 5-star dog walking, pet sitting, expert pet
advice, wellness plans, and one-on-one training from Wag!’s
community of 400,000 local pet caregivers nationwide, in addition
to pet insurance options from the leading pet insurance companies.
Making pet parents happy is what Wag! does best. With safety and
wellness at the forefront, Wag! has a trusted record of experience
with more than 12 million pet care services completed by pet
caregivers on the Wag! Platform, across 5,300 cities and 50 states,
with pet parents rating 96% of services as 5-star. Wag! also
operates Petted.com, the nation’s largest pet insurance comparison
marketplace. Additionally, the Wag! Pet Caregiver App, empowers pet
caregivers to care for pets in their neighborhood and earn real
money. For more information, visit wag.co.
Non-GAAP Financial Measures and Other Operating
Metrics
Adjusted EBITDA is a non-GAAP financial measure defined as net
income (loss) adjusted for (benefit from) income taxes, interest
income (expense), depreciation and amortization, and stock-based
compensation expense. Adjusted EBITDA provides a basis for
comparison of our business operations between current, past, and
future periods by excluding items from net income (loss) that we do
not believe are indicative of our core operating performance.
Gross bookings is defined as the total dollar value of a
transaction booked via the platform for pet and wellness services,
in each case without any adjustment for discounts or refunds, Pet
Caregiver earnings and Pet Parent incentives. Bookings are an
indication of the scale of our current platform, which ultimately
impacts revenue.
Take rate is calculated as revenue divided by gross bookings.
Take Rate is an indication of marketplace economics, and is
impacted by product offerings with different margin structures. We
use take rate to identify key revenue drivers in our
marketplace.
Platform Participant is defined as a Pet Parent
or Pet Caregiver who transacted on the Wag! platform for a service
in the quarter. Services include dog walking, sitting, boarding,
drop-ins, training, premium telehealth services, wellness plans,
and pet insurance plan comparison.
Forward-Looking Statements
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995. Some of the forward-looking statements can be identified
by the use of forward-looking words. Statements that are not
historical in nature, including the words “anticipate,” “expect,”
“suggests,” “plan,” “believe,” “intend,” “estimates,” “targets,”
“projects,” “should,” “could,” “would,” “may,” “will,” “forecast”
and other similar expressions are intended to identify
forward-looking statements. These statements include those related
to the Company’s ability to further develop and advance its pet
service offerings and achieve scale; ability to attract personnel;
market opportunity, anticipated growth, and future financial
performance, including management’s financial outlook for 2022.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future events to
differ materially from the forward-looking statements in this press
release, including but not limited to: management’s financial
outlook for 2022; market adoption of the Company’s pet service
offerings and solutions; the ability of the Company to protect its
intellectual property; changes in the competitive industries in
which the Company operates; changes in laws and regulations
affecting the Company’s business; the Company’s ability to
implement its business plans, forecasts and other expectations, and
identify and realize additional partnerships and opportunities; and
the risk of downturns in the market and the technology industry
including, but not limited to, as a result of the COVID-19
pandemic. The foregoing list of factors is not exhaustive. You
should carefully consider the foregoing factors and the other risks
and uncertainties described in the “Risk Factors” section of the
Company’s final prospectus filed with the SEC on July 12, 2022 and
other documents filed by the Company from time to time with the
Securities and Exchange Commission. These filings identify and
address other important risks and uncertainties that could cause
actual events and results to differ materially from those contained
in the forward-looking statements. Forward-looking statements speak
only as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and the Company
assumes no obligation and does not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise. The Company does not give any
assurance that it will achieve its expectations.
Contacts
Media:
Wag!: Media@wagwalking.com
Investor Relations:
ICR for Wag!: WagIR@icrinc.com
Financial Statements and Adjusted
Reconciliations
Wag Labs, IncCondensed
Consolidated Statements of
Operations(Unaudited)
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
2022 |
2021 |
|
2022 |
2021 |
Revenues |
$ |
12,784 |
|
$ |
3,567 |
|
|
$ |
22,450 |
|
$ |
6,156 |
|
Costs and expenses: |
|
|
|
|
|
|
|
|
|
Cost of revenues (exclusive of depreciation and amortization shown
separately below) |
|
1,200 |
|
|
675 |
|
|
|
2,006 |
|
|
1,073 |
|
Platform operations and support |
|
2,817 |
|
|
2,690 |
|
|
|
5,394 |
|
|
5,260 |
|
Sales and marketing |
|
7,284 |
|
|
1,235 |
|
|
|
13,366 |
|
|
1,840 |
|
General and administrative |
|
2,398 |
|
|
1,333 |
|
|
|
4,765 |
|
|
2,996 |
|
Depreciation and amortization |
|
145 |
|
|
55 |
|
|
|
297 |
|
|
110 |
|
Total costs and expenses |
|
13,844 |
|
|
5,988 |
|
|
|
25,828 |
|
|
11,279 |
|
Interest expense, net |
|
(17 |
) |
|
(9 |
) |
|
|
(49 |
) |
|
(14 |
) |
Loss before income taxes |
|
(1,077 |
) |
|
(2,430 |
) |
|
|
(3,427 |
) |
|
(5,137 |
) |
Income tax expense |
|
(13 |
) |
|
(4 |
) |
|
|
(13 |
) |
|
(4 |
) |
Net loss |
$ |
(1,090 |
) |
$ |
(2,434 |
) |
|
$ |
(3,440 |
) |
$ |
(5,141 |
) |
Net loss per share |
|
|
|
|
|
|
|
|
|
Basic and diluted |
$ |
(0.17 |
) |
|
(0.43 |
) |
|
$ |
(0.55 |
) |
|
(0.91 |
) |
Weighted-average shares used
to compute net loss per share basic and diluted |
|
6,305,282 |
|
|
5,638,678 |
|
|
|
6,301,362 |
|
|
5,636,666 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wag Labs, Inc.Adjusted
EBITDA Reconciliation(Unaudited)
|
Three Months Ended June 30, |
Six Months Ended June 30, |
($ in thousands) |
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
Revenue |
$12,784 |
|
$3,567 |
|
$22,450 |
|
$6,156 |
|
Adjusted EBITDA
reconciliation: |
|
|
|
|
Net loss |
$(1,090 |
) |
$(2,434 |
) |
$(3,440 |
) |
$(5,141 |
) |
Add: |
|
|
|
|
Interest expense |
|
17 |
|
|
9 |
|
|
49 |
|
|
14 |
|
Depreciation and
amortization |
|
145 |
|
|
55 |
|
|
297 |
|
|
110 |
|
Share based compensation |
|
40 |
|
|
61 |
|
|
94 |
|
|
122 |
|
Tax (benefit) expense |
|
13 |
|
|
4 |
|
|
13 |
|
|
4 |
|
Adjusted EBITDA |
$(875 |
) |
$(2,305 |
) |
$(2,987 |
) |
($4,891 |
) |
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