Proceeds used to refinance previous debt,
expected to reduce interest expense by approximately $17M in
2024
Lenders are J.P. Morgan, Bank of America,
Citizens Bank, Silicon Valley Bank, and Capital One
Grindr Inc. (NYSE:GRND), the world’s largest social network for
the LGBTQ community, today announced that it completed a
refinancing via a new $300 million Term Loan A facility and a $50
million Revolving Credit facility.
Building Strong Financial
Relationships
The joint lead arrangers of the transaction are J.P. Morgan,
Bank of America, Citizens Bank, and Silicon Valley Bank, a division
of First Citizens Bank. Capital One also participated as a
lender.
The transaction is an important milestone for Grindr, as the
only public company built and run by and for the LGBTQ community,
in strengthening key relationships with the world’s top banks.
“We would like to thank our new financial partners for backing
Grindr and the diverse gay community we represent,” said Grindr CEO
George Arison. “This is very meaningful, and I’m proud to have the
support of some of the world’s leading financial institutions in
enabling a more open and welcoming financial ecosystem. We look
forward to continuing our work to create a world where the lives of
our users are free, equal, and just.”
Delivering on
Commitments
The new facilities, which mature in November 2028, bear interest
at a rate equal to Term SOFR plus an applicable margin of 275 to
325 basis points above the Secured Overnight Financing Rate (SOFR),
based on Grindr’s leverage.
“Restructuring our high-cost lending facility was a key
objective in our first year as a public company, and we’re very
pleased with our successful outcome, especially in a challenging
interest rate environment,” said Grindr CFO Vanna Krantz. “The
significant reduction in cash interest expense achieved through
this transaction will strengthen both our balance sheet and our
profitability profile. We are excited about Grindr’s strong growth
potential next year and beyond.”
Grindr went public in November 2022, and reported Q3 2023
results of 39% year-over-year revenue growth to $70.3 million and
an adjusted EBITDA margin of 46%. Based on the company’s continued
financial outperformance throughout 2023, the company increased its
revenue growth guidance for the full year to 31% and maintained its
expected adjusted EBITDA margin at 41%.
About Grindr Inc.
With more than 13 million monthly active users in virtually
every country in the world, Grindr has grown to become a
fundamental part of the LGBTQ community since its launch in 2009.
The company continues to expand its platform to enable gay, bi,
trans, and queer people to connect, express themselves, and
discover the world around them. Grindr’s impact is further driven
by Grindr for Equality’s wide-ranging initiatives that help the
LGBTQ community around the world. Grindr is headquartered in West
Hollywood, California. The Grindr app is available on the App Store
and Google Play.
Forward Looking
Statements
This press release contains “forward looking statements” within
the meaning of the “safe harbor” provisions of the United States
Private Securities Litigation Reform Act of 1995 regarding our
current views with respect to our ability to strengthen our balance
sheet and profitability profile, our future growth potential, and
our revenue growth guidance and adjusted EBITDA margin guidance for
2023. These forward-looking statements can generally be identified
by the use of forward-looking terminology, such as “anticipates,”
“approximately,” “believes,” “continues,” “could,” “estimates,”
“expects,” “intends,” “may,” “outlook,” “plans,” “potential,”
“predicts,” “seeks,” “should,” “will,” or the negative version of
these words or other comparable words or phrases, but the absence
of these words does not mean that a statement is not
forward-looking. Forward-looking statements, including guidance
related to revenue growth and adjusted EBITDA margin and statements
regarding the expected benefits of the refinancing, are
predictions, projections, and other statements about future events
that are based on current expectations and assumptions and, as a
result, are not guarantees of future performance and are subject to
risks and uncertainties that may cause actual results to differ
materially from our expectations discussed in the forward-looking
statements. Many factors could cause actual future events to differ
materially from the forward-looking statements in this press
release, including but not limited to:
- our actual ability to comply with the covenants contained in
the Credit Agreement for our new credit facility;
- our reliance on historical data, which may be of limited
reliability, in providing revenue guidance;
- our success in retaining or recruiting our directors, officers,
key employees, or other key personnel, and our success in managing
any changes in such roles;
- the impact of the regulatory environment and complexities with
compliance related to such environment, including maintaining
compliance with privacy and data protection laws and
regulations;
- our ability to respond to general economic conditions;
- factors relating to the business, operations, and financial
performance of Grindr and our subsidiaries, including:
- competition in the dating and social networking products and
services industry;
- the ability to maintain and attract users;
- fluctuation in quarterly and yearly results;
- our ability to adapt to changes in technology and user
preferences in a timely and cost-effective manner;
- our ability to protect systems and infrastructures from
cyber-attacks and prevent unauthorized data access;
- our dependence on the integrity of third-party systems and
infrastructure; and
- our ability to protect our intellectual property rights from
unauthorized use by third parties.
- whether the concentration of our stock ownership and voting
power limits our stockholders’ ability to influence corporate
matters;
- the effects of macroeconomic and geopolitical events on our
business, such as health epidemics, pandemics, natural disasters,
and wars or other regional conflicts;
- the ability to maintain the listing of our common stock and
public warrants on the New York Stock Exchange (“NYSE”); and
- the increasingly competitive environment in which we
operate.
The foregoing list of factors is not exhaustive. Further
information on these and additional risks, uncertainties and other
factors that could cause actual outcomes and results to differ
materially from those included in or contemplated by the
forward-looking statements contained in this press release are
included in the section titled “Risk Factors” included under Part
I, Item 1A in our Annual Report on Form 10-K for the year ended
December 31, 2022, and updates in our Quarterly Report on Form 10-Q
for the quarter ended June 30, 2023. Any forward-looking statement
speaks only as of the date on which it is made, you should not
place undue reliance on forward-looking statements, and we assume
no obligation and do not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise.
About Non-GAAP Measures
We use Adjusted EBITDA margin, which is a non-GAAP measure, to
understand and evaluate our core operating performance. This
non-GAAP financial measure, which may differ from similarly titled
measures used by other companies, is presented to enhance
investors’ overall understanding of Grindr’s financial performance
and should not be considered as a substitute for, or superior to,
the financial information prepared and presented in accordance with
GAAP. We define Adjusted EBITDA as net loss excluding income tax
provision; interest expense, net; depreciation and amortization;
stock-based compensation expense; severance; litigation-related
costs for matters unrelated to our ongoing business, including
those matters incurred as part of the Business Combination; Legacy
Grindr management fees; change in fair value of warrant liability;
and other expense. Adjusted EBITDA Margin is calculated by dividing
Adjusted EBITDA for a period by revenue for the same period. Our
management uses this measure internally to evaluate the performance
of our business and this measure is one of the primary metrics by
which our internal budgets are based and by which management is
compensated. We exclude the above items from net loss as some are
non-cash in nature, and others are non-recurring such that they may
not be representative of normal operating results. Adjusted EBITDA
adjusts for the impact of items that we do not consider indicative
of the operational performance of our business. While we believe
that Adjusted EBITDA Margin is useful in evaluating our business,
this information should be considered as supplemental in nature and
is not meant as a substitute for the related financial information
prepared and presented in accordance with GAAP. We provide a
reconciliation of net loss and net loss margin to Adjusted EBITDA
and Adjusted EBITDA margin for the three months ended September 30,
2023, in our press release furnished as Exhibit 99.1 to our Current
Report on Form 8-K filed with the Securities and Exchange
Commission on November 13, 2023. Our net loss and net loss margin
for the three months ended September 30, 2023, were $(0.4) million
and (0.6)%, respectively.
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Investors: IR@grindr.com Media: Press@grindr.com
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