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SEC Filings

TRIVAGO N.V. filed this Form 6-K on 02/06/2019
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Balance sheet and cash flows
Total Cash, cash equivalents and restricted cash were €164.3 million as of December 31, 2018, of which €162.0 million were Cash, cash equivalents and restricted cash and €2.3 million long-term restricted cash included in other long-term assets in the balance sheet primarily relating to the new campus building, compared to total Cash, cash equivalents and restricted cash of €192.9 million as of December 31, 2017. The decrease of €28.6 million was mainly driven by negative cash flow from investing activities of €24.1 million, which primarily related to the new campus building.

The decrease in cash, cash equivalents and restricted cash was further driven by negative cash flows from operating activities of €4.6 million, which was mainly driven by changes in operating assets and liabilities, offset by positive effects from net income excluding non-cash expenses. Changes in operating assets and liabilities resulted in a decrease in Cash and cash equivalents of €19.3 million primarily due to increased accounts receivable and declining accounts payable. Accounts receivable increased by €13.5 million, of which €0.6 million were related party receivables, as of December 31, 2018 compared to December 31, 2017, mainly due to delayed payments from advertisers. Accounts payable decreased by €17.7 million as of December 31, 2018 compared to December 31, 2017, primarily due to the decline in Advertising Spend, which decreased from €149.7 million in the fourth quarter of 2017 to €99.9 million in the fourth quarter of 2018.

A net loss of €20.8 million included non-cash expenses for share based compensation of €20.7 million and depreciation of €11.4 million, which partly offset the decline in operating assets and liabilities described above.

Our current ratio increased from 3.7 as of December 31, 2017 to 4.4 as of December 31, 2018 as the decrease in our current liabilities driven by the decline in accounts payable was higher than the decrease in our current assets.

During the construction period of two building phases related to our new campus in Düsseldorf, we are deemed the accounting owner and treat the construction as if we were the legal owner of the construction project. As such, an asset for construction-in-process and a liability for those costs not funded by trivago are recorded on our balance sheet. Upon moving into the first building in June 2018, we continue to be the accounting owner, and we are accounting for the asset and liability recognized for the building as a financing. The second building remains under construction and we continue to recognize an asset and liability on our balance sheet for the construction costs that are not funded by trivago.

Update on legal proceedings
On August 23, 2018, the Australian Competition and Consumer Commission, or ACCC, instituted proceedings in the Australian Federal Court against us. The ACCC alleged breaches of Australian consumer law relating to our advertisements in Australia concerning the hotel prices available on our Australian site and our strike-through pricing practice, which is the display adjacent to the price quote in the top position in our search results of a higher price that is crossed out. On November 27, 2018, we filed a response to the ACCC's statement of claim. On December 19, 2018, the court issued an order requiring us to produce certain documents by February 28, 2019. The order also set a trial date for September 9, 2019. Management has established a provision in respect of this matter.

A consolidated class action is pending against us in the United States District Court for the Southern District of New York alleging securities law violations in our IPO registration statement and certain later disclosures. On February 4, 2019, the court heard oral arguments regarding our pending motion to dismiss. We are unable to estimate this matter’s potential effect on our financial position and results of operations.

The U.K. Competition & Markets Authority, or CMA, announced the launch of a consumer law investigation into online hotel booking sites in the United Kingdom in October 2017. On July 26, 2018, the CMA informed us of its decision to open an investigation into certain of our display practices in the United Kingdom that the