Frontdoor Inc
For the period ended Jun 30, 2024. Filed Aug 1, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2024 · Filed Aug 1, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
See the whole filing, with its images and exhibitsContents
Cover page
Show cover page
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
| | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|
For the quarterly period ended June 30,2024
or
| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|
For the transition period from to
Commission file number 001-38617
(Exact name of registrant as specified in its charter)
| Delaware | 82-3871179 |
|---|---|
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
3400 Players Club Parkway, Memphis, Tennessee 38125
(Address of principal executive offices) (Zip Code)
901-701-5000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Trading Symbol | Name of Each Exchange on which Registered |
|---|---|---|
| Common stock, par value $0.01 per share | FTDR | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes No
Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | Accelerated filer | Non-accelerated filer | Smaller reporting company |
|---|---|---|---|
| Emerging growth company | |||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes No
As of July 26, 2024, there were 76,524,535 shares outstanding of the registrant’s common stock, par value $0.01 per share.
Quarterly Report on Form 10-Q
GLOSSARY OF TERMS AND SELECTED ABBREVIATIONS
In order to aid the reader, we have included certain defined terms and abbreviations used throughout this Quarterly Report on Form 10-Q as set forth below:
| Term / Abbreviation | Definition |
|---|---|
| 2-10 HBW | The businesses operated by 2-10 Holdco, Inc. and all of its subsidiaries |
| 2-10 HBW Acquisition | The acquisition of 2-10 HBW by Frontdoor pursuant to the terms of the Purchase Agreement |
| AOCI | Accumulated other comprehensive income or loss |
| ASC | FASB Accounting Standards Codification |
| ASU | FASB Accounting Standards Update |
| Credit Agreement | The agreements governing the Credit Facilities |
| Credit Facilities | The Term Loan Facilities together with the Revolving Credit Facility |
| Exchange Act | Securities Exchange Act of 1934, as amended |
| FASB | U.S. Financial Accounting Standards Board |
| Home Warranty | A home service contract, sometimes called a residential service contract, home warranty or home protection contract, provides for the repair and/or replacement of certain home systems and appliances for breakdowns that occur as a result of normal wear and tear |
| HVAC | Heating, ventilation and air conditioning |
| IRS | U.S. Internal Revenue Service |
| NASDAQ | Nasdaq Global Select Market |
| Omnibus Plan | Frontdoor, Inc. 2018 Omnibus Incentive Plan |
| Purchase Agreement | Share Purchase Agreement dated June 3, 2024, by and among Frontdoor, Inc., 2-10 HBW Acquisition, L.P. and 2-10 Holdco, Inc. pursuant to which Frontdoor acquires all of the issued and outstanding stock of 2-10 Holdco, Inc. |
| Revolving Credit Facility | $250 million revolving credit facility effective June 17, 2021 |
| SEC | U.S. Securities and Exchange Commission |
| Securities Act | Securities Act of 1933, as amended |
| Streem | Streem, LLC, our technology business that uses augmented reality, computer vision and machine learning to provide services |
| Term Loan A | $260 million term loan A facility effective June 17, 2021 |
| Term Loan B | $380 million term loan B facility effective June 17, 2021 |
| Term Loan Facilities | The Term Loan A together with the Term Loan B |
| U.S. or United States | United States of America |
| U.S. GAAP | Accounting principles generally accepted in the United States of America |
In this Quarterly Report on Form 10-Q, unless the context indicates otherwise, references to “Frontdoor,” “we,” “our,” “us,” and the “company” refer to Frontdoor, Inc. and all of its subsidiaries. Frontdoor is a Delaware corporation with its principal executive offices in Memphis, Tennessee.
We hold various service marks, trademarks and trade names, such as Frontdoor®, American Home Shield®, HSA™, OneGuard®, Landmark Home Warranty®, Streem®, the Streem logo and the Frontdoor logo. Solely for convenience, the service marks, trademarks and trade names referred to in this Quarterly Report on Form 10-Q are presented without the SM, ®, and TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors to these service marks, trademarks and trade names. All service marks, trademarks and trade names appearing in this Quarterly Report on Form 10-Q are the property of their respective owners.
Certain amounts presented in the tables in this report are subject to rounding adjustments and, as a result, the totals in such tables may not sum.
TABLE OF CONTENTS
| Page | |
|---|---|
| No. | |
| Part I. Financial Information | |
| Item 1. Financial Statements (Unaudited) | |
| Condensed Consolidated Statements of Operations and Comprehensive Income | 3 |
| Condensed Consolidated Statements of Financial Position | 4 |
| Condensed Consolidated Statements of Changes in Equity (Deficit) | 5 |
| Condensed Consolidated Statements of Cash Flows | 6 |
| Notes to Condensed Consolidated Financial Statements | 7 |
| Cautionary Statement Concerning Forward-Looking Statements | 17 |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations | 19 |
| Item 3. Quantitative and Qualitative Disclosures About Market Risk | 32 |
| Item 4. Controls and Procedures | 32 |
| Part II. Other Information | 32 |
| Item 1. Legal Proceedings | 32 |
| Item 1A. Risk Factors | 32 |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 34 |
| Item 6. Exhibits | 35 |
| Signature | 36 |
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.