Trupanion Inc (NASDAQ:TRUP) Q2 2020 Earnings Conference Call - Final Transcript

Aug 04, 2020 • 04:30 pm ET


Trupanion Inc (NASDAQ:TRUP) Q2 2020 Earnings Conference Call - Final Transcript


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Greetings, and welcome to the Trupanion, Inc. Second Quarter 2020 Results Call. [Operator Instructions] [Operator Instructions].

It is now my pleasure to introduce your host, Laura Bainbridge, Head of excuse me, Head of Corporate Communications. Thank you. You may begin.

Laura Bainbridge

Good afternoon, and welcome to Trupanion's Second Quarter 2020 Financial Results Conference Call. Participating on today's call are Darryl Rawlings, Chief Executive Officer; and Tricia Plouf, Chief Financial Officer. Margi Tooth, Trupanion's Chief Revenue Officer, will also be available for the Q&A portion of today's call. Before we begin, I would like to remind everyone that during today's conference call, we will make certain forward-looking statements regarding the future operations, opportunities and financial performance of Trupanion within the meaning of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These statements involve a high degree of known and unknown risks and uncertainties that could cause actual results to differ materially from those discussed.

A detailed discussion of these and other risks and uncertainties are included in our earnings release, which can be found on our Investor Relations website as well as the company's most recent reports on Forms 10-K and 8-K filed with the Securities and Exchange Commission. Today's presentation contains references to non-GAAP financial measures that management uses to evaluate the company's performance, including, without limitation, fixed expenses, variable expenses, adjusted operating income, acquisition costs, internal rate of return, adjusted EBITDA and free cash flow. When we use the term adjusted operating income or margin, it is intended to refer to our non-GAAP operating income or margin before new pet acquisition.

Unless otherwise noted, margins and expenses will be presented on a non-GAAP basis, which excludes stock-based compensation expense and depreciation expense. These non-GAAP measures are in addition to and not a substitute for measures of financial performance prepared in accordance with the U.S. GAAP. Investors are encouraged to review the reconciliations of these non-GAAP financial measures to the most directly comparable GAAP results, which can be found in today's press release or on Trupanion's Investor Relations website under the Quarterly Earnings tab. Lastly, I would like to remind everyone that today's call is also available via webcast on Trupanion's Investor Relations website. A replay will also be available on the site.

And with that, I will hand the call over to Darryl.

Darryl Rawlings

Thanks, Laura. It was a strong quarter for Trupanion. Normally, I start with a review of our key financial metrics. This quarter, the metrics speak for themselves. So I'll start with some context around our business performance. Just a few months ago, we moved our entire workforce remote against the backdrop of a steep and unprecedented economic downturn. Throughout this period of change, the team stepped up in support of our members and delivered on our promise to be there 24/7, 365. In times of uncertainty, the need to help pet owners budget for the unexpected is even greater. Across the business, we delivered record-breaking service levels from the speed we answer the