Despegar.com (DESP) 6-K Current report (foreign)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of December 2022

Commission File Number: 001-38209

Despegar.com, Corp.

(Translation of registrant’s name into English)

Juana Manso 999

Ciudad Autónoma de Buenos Aires

Argentina C1107CBR

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F  ☒            Form 40-F  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):  ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):  ☐

Due to a formatting error of the financial printer used by the Company, a portion of the balance sheet as of September 30, 2022 was inadvertently omitted from the Company’s Current Report on Form 6-K filed on November 17, 2022, although the full balance sheet as of such date was publicly available on the Company’s website. The Company is filing this Current Report on Form 6-K to include the full financial statements for the third quarter. For the avoidance of doubt, no changes to the financial statements have been made.

Unaudited Consolidated Balance Sheet as of September 30, 2022 and June 30, 2022 (in thousands of U.S. dollars, except as otherwise indicated)

	As of September 30, 2022		As of June 30, 2022
ASSETS
Current assets
Cash and cash equivalents		222,682		236,278
Restricted cash		40,397		38,486
Short term investments		—	$	286
Trade accounts receivable, net of credit expected loss		121,171		137,265
Loan receivables, net		15,042		15,848
Related party receivable		16,603		16,045
Other current assets and prepaid expenses		37,075		12,021
Total current assets		452,970		456,229
Non-current assets
Other assets and prepaid expenses		77,619		58,527
Loan receivables, net		1,349		1,373
Lease right-of-use assets		23,278		24,758
Property and equipment net		16,802		17,486
Intangible assets net		91,109		85,897
Goodwill		134,512		141,366
Total non-current assets		344,669		329,407
TOTAL ASSETS		797,639		785,636
LIABILITIES AND SHAREHOLDERS’ DEFICIT
Current liabilities
Accounts payable and accrued expenses		51,926		61,291
Travel suppliers payable		282,354		280,974
Related party payable		41,395		43,728
Short-term debt		25,373		21,591
Deferred Revenue		21,059		18,268
Other liabilities		85,522		61,878

Contingent liabilities	16,714		11,354
Lease Liabilities	6,174		6,377
Total current liabilities	530,517		505,461
Non-current liabilities
Other liabilities	39,842		35,756
Contingent liabilities	24,589		25,569
Long term debt	8,023		9,330
Lease liabilities	17,747		18,894
Related party liability	125,004		125,004
Total non-current liabilities	215,205		214,553
TOTAL LIABILITIES	745,722		720,014
Series A non-convertible preferred shares	114,354		107,537
Series B convertible preferred shares	46,700		46,700
Mezzanine Equity	161,054		154,237
SHAREHOLDERS’ DEFICIT
Common stock	285,014		284,493
Additional paid-in capital	334,518		347,819
Other reserves	(728	)	(728	)
Accumulated other comprehensive loss	(21,509	)	(25,994	)
Accumulated losses	(628,165	)	(618,879	)
Treasury Stock	(78,267	)	(75,326	)
Total Shareholders’ Equity Attributable / (Deficit) to Despegar.com Corp	(109,137	)	(88,615	)
TOTAL LIABILITIES, MEZZANINE EQUITY AND SHAREHOLDERS’ DEFICIT	797,639		785,636

Unaudited Consolidated Statements of Operations for the three-month periods ended September 30, 2022 and 2021 (in thousands of U.S. dollars, except as otherwise indicated)

	3Q22			3Q21			% Chg
Total Revenue		145,596			83,368			75	%
Cost of revenue		50,305			37,953			33	%
Gross profit		95,291			45,415			110	%
Operating expenses
Selling and marketing		46,174			26,138			77	%
General and administrative (1)		24,873			22,162			12	%
Technology and product development		22,834			19,432			18	%
Total operating expenses		93,881			67,732			39	%
Loss from equity investments		(105	)		(29	)		n.m.
Operating income / (loss)		1,305			(22,346	)		n.m.
Financial result, net		(15,359	)		(3,254	)		n.m.
Net loss before income taxes		(14,054	)		(25,600	)		n.m.
Income tax benefit		(4,767	)		(1,654	)		n.m.
Net loss		(9,287	)		(23,946	)		n.m.
Net income attributable to non controlling interest		—			273			n.m.
Net loss attributable to Despegar.com, Corp		(9,287	)		(23,673	)		n.m.

(1) Starting 2Q22, the Company reclassified bad debt related to Koin and Despegar from General and Administrative expenses to Cost of Revenue to more accurately reflect Despegar´s cost structure.

Unaudited Statements of Cash Flows for the three-month periods ended September 30, 2022 and 2021 (in thousands of U.S. dollars, except as otherwise indicated)

	3 months ended September 30,
	2022			2021
Cash flows from operating activities
Net loss		($9,287	)		($23,945	)
Adjustments to reconcile net income / (loss) to net cash flows from operating activities:
Net income attributable to redeemable non-controlling interest		—			$274
Unrealized foreign currency translation income / (losses)		$6,379			($729	)
Depreciation expense		$2,144			$2,451
Amortization expenses		$6,871			$6,457
Disposals of property and equipment		—			($121	)
Earnout		($1,136	)		($519	)
Indemnity		$1,136			$519
Loss from equity investments		$105			$1,486
Stock based compensation expense		$1,305			$1,343
Amortization of lease right-of-use assets		$1,008			$2,149
Interest and penalties		$540			$300
Income taxes		($5,128	)		($5,267	)
Allowance for credit expected losses		$2,634			($2,746	)
Provision for contingencies		$3,951			($1,857	)
Changes in assets and liabilities net of non-cash transactions:
Decrease / (increase) in trade accounts receivable, net of credit expected loss		$22,743			($23,552	)
Increase in Loans receivables		($7,956	)		($954	)
Increase in related party receivables		($5,931	)		($4,542	)
(Increase) / Decrease in other assets and prepaid expenses		($33,161	)		$771
(Decrease) / increase in accounts payables and accrued expenses		($9,782	)		$3,697
(Decrease) / increase in travel suppliers payables		($2,853	)		$14,407
Increase / (decrease) in other liabilities		$38,826			($965	)
(Decrease) / increase in contingent liabilities		($4,914	)		$1,482
Increase / (Decrease) in related party liabilities		($2,205	)		$710
(Decrease) / increase in leases liability		$2,032			($2,620	)
Increase in deferred revenue		$3,021			$1,264
Net cash flows provided by / (used in) operating activities		10,342			(30,507	)
Cash flows from investing activities:
(Increase)/ Decrease in short term investments		$3			—
Increase in Loan Receivables		($5,063	)		($438	)
Collection on Loan Receivables		$2,045			$142
Payment for acquired businesses, net of cash acquired		($10,408	)		($998	)
Acquisition of property and equipment		($1,748	)		($472	)
Increase of intangible assets including internal-use software and website development		($6,964	)		($4,344	)
Net cash flows used in investing activities		(22,135	)		(6,110	)
Cash flows from financing activities:
Net increase of short term debt		$10,682			$986
Decrease in long-term debt		($1,421	)		($423	)

Payment of dividends to stockholders	($802	)	($504	)
Exercise of stock-based awards	$254		($27	)
Collect on debenture issuance by securitization program	$1,047		—
Purchase of treasury stock	($4,610	)	—
Net cash flows provided by financing activities	5,150		32
Effect of exchange rate changes on cash and cash equivalents	($5,042	)	($3,204	)
Net decrease in cash and cash equivalents	($11,685	)	($39,789	)
Cash and cash equivalents as of beginning of the year	$274,764		$315,981
Cash and cash equivalents as of end of the period	$263,079		$276,192

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. We base these forward-looking statements on our current beliefs, expectations and projections about future events and financial trends affecting our business and our market. Many important factors could cause our actual results to differ substantially from those anticipated in our forward-looking statements. Forward-looking statements are not guarantees of future performance. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update publicly or to revise any forward-looking statements. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this press release. The words “believe,” “may,” “should,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “will,” “expect” and similar words are intended to identify forward-looking statements. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, capital expenditures, financing plans, competitive position, industry environment, potential growth opportunities, the effects of future regulation and the effects of competition. Considering these limitations, you should not make any investment decision in reliance on forward-looking statements contained in this press release.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: December 27, 2022

DESPEGAR.COM, CORP.
By:	/s/ Mariano Scagliarini
Name: Mariano Scagliarini
Title: General Counsel