Trupanion Reports Third Quarter 2015 Results

Total revenue of $37.9 million, up 25% year-over-year (up 30% on a constant currency basis) and 276,988 total enrolled pets at quarter-end, up 25% year-over-year 

Trupanion, Inc. (NYSE: TRUP), today announced financial results for the three and nine months ended September 30, 2015.

"Our third quarter performance was exceptionally strong, as evidenced by the strength of our new pet enrollments and the acceleration in our active hospital growth rate to the highest level in four years," said Darryl Rawlings, Trupanion's Chief Executive Officer.  "As is evident, our Territory Partners continue to build the trust and support of veterinarians and their staff.  We also continued our efforts to provide a world-class member experience with the deployment of Trupanion Express.  We are ahead of schedule on Trupanion Express installations, having already achieved our year-end projections of 350 Trupanion Express enabled hospitals during the third quarter."

Rawlings added, "Our core subscription business remains the primary driver of our performance, posting 27% revenue growth despite foreign exchange headwinds and a 26% increase in enrolled pets.  Our value proposition continues to resonate with our members, as evidenced by our continually strong 98.66% monthly membership retention rate.  We also delivered subscription gross margin expansion to within our long-term target of 18-21%.  As a result, subscription gross profit increased 54% over the prior year period."

Third Quarter 2015 Financial Highlights 
(All comparisons on a year-over-year basis)

  • Total revenue was $37.9 million, an increase of 25%.  Revenue growth was 30% on a constant currency basis.
  • Subscription business revenue was $34.4 million, an increase of 27%.  Subscription business revenue increased 33% on a constant currency basis.
  • Adjusted EBITDA was a loss of $(3.2) million, compared to a loss of $(2.9) million.
  • Net loss was $(4.6) million, compared to a net loss of $(8.5) million.
  • Cash, cash equivalents and short-term investments of $44.9 million.

Year-to-date 2015 Financial Highlights
(All comparisons on a year-over-year basis)

  • Total revenue was $106.8 million, an increase of 27%.  Total revenue growth was 31% on a constant currency basis.
  • Subscription business revenue was $96.7 million, an increase of 29%.  Subscription business revenue increased 34% on a constant currency basis.
  • Adjusted EBITDA was a loss of $(9.7) million, compared to a loss of $(7.4) million.
  • Net loss was $(14.2) million, compared to a net loss of $(16.9) million.

Third Quarter 2015 Operating Metrics
(All comparisons on a year-over-year basis)

  • Monthly adjusted revenue per pet (ARPP) was $45.15, an increase of 0.6%.  ARPP increased 5% on a constant currency basis. 
  • The ratio of lifetime value of a pet (LVP) to average pet acquisition cost (PAC) was 4.6 to 1.
  • Total enrolled pets (including pets from our other business segment) was 276,988 at quarter-end, up 25%.
  • Subscription pets enrolled was 258,546 at quarter-end, up 26%.

Trupanion currently expects to achieve the following results for the full year ending December 31, 2015:

  • Total revenue is expected to be in the range of $146.5 - $148.5 million.
  • Adjusted EBITDA is expected to be in the range of $(13)-$(10) million.

The company's outlook for full year 2015 assumes a 75% Canadian currency exchange rate, the approximate rate at the end of September 2015.

Conference Call
Trupanion's management will host a conference call today to review its third quarter 2015 results and to discuss its financial outlook for the full year 2015. The call is scheduled to begin at 1:30 p.m. PT/ 4:30 p.m. ET. A live webcast will be accessible through the Investor Relations section of Trupanion's website at http://investors.trupanion.com and will be archived online for 60 days upon completion of the conference call. Participants can access the conference call by dialing 1-866-311-7654 (United States), 1-855-669-9657 (Canada), or 1-412-902-4113 (International). A telephonic replay of the call will also be available, one hour after the completion of the call, by dialing 1-877-344-7529 (United States), 1-855-669-9658 (Canada), or 1-412-317-0088 (International) and entering the replay pin number: 10057847.


About Trupanion
Founded in 2000, Trupanion is an industry-leading, direct-to-consumer, monthly subscription business that provides medical plans for cats and dogs in the United States, Canada and Puerto Rico through its affiliated entities. With over 275,000 total enrolled pets (as of November 3, 2015), Trupanion is one of the largest pet medical insurance companies in North America with the mission to help the pets we all love receive the best veterinary care. Trupanion offers a simple, fair and comprehensive pet medical plan that pays 90% of covered veterinary costs for pets' illness and injury claims. Trupanion's shares are traded on the New York Stock Exchange under the ticker symbol TRUP. The company is headquartered in Seattle, WA and can be found online at Trupanion.com.


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