Amsterdam’s Just Eat Takeaway made progress towards profitability in H1 2022: Report

Amsterdam-based Just Eat Takeaway.com, an online food delivery marketplace, has published its H1 2022 report that outlines what happened in the company in the first half and how it contributed to the European online food marketplace.

Jitse Groen, CEO of Just Eat Takeaway.com, says, “After a period of exceptional growth, Just Eat Takeaway.com is now two times larger than it was pre-pandemic. Whilst this growth required significant investment, we have continued to focus on executing our strategy to build and operate highly profitable food delivery businesses. Our three largest segments, representing 90 per cent of our Gross Transaction Value, were Adjusted EBITDA positive in the second quarter of 2022. Our path to profitability is accelerating, and we expect to continue to materially improve our Adjusted EBITDA in the second half of this year and to be Adjusted EBITDA positive at a Group level in 2023.”

7% decrease in orders

According to the report, H1 2021 was a record period for the company in terms of Order and Gross Transaction Value (GTV) growth due to the Covid-19 restrictions.

But orders in H1 2022 decreased by 7 per cent compared to H1 2021. 

However, it was offset by higher Average Transaction Value (ATV), consumer pricing improvements, and positive currency movements, leading to stable GTV at €14.2B and strong revenue growth of 7 per cent to €2.8B in H1 2022, reveals the report. 

Adjusted EBITDA improves

In H1 2022, Adjusted EBITDA improved by 29 per cent to minus €134M (minus 0.9% of GTV). This year-on-year improvement demonstrates the path to profitability on an absolute level and as a percentage of GTV.

Northern Europe, the UK, and Ireland

As per the report, the Northern Europe region continues to generate significant profit with an Adjusted EBITDA of €124M in H1 2022.

In the UK and Ireland, Adjusted EBITDA improved 70 per cent to minus €18M in H1 2022. The segment was Adjusted EBITDA positive in Q2 2022.

The report adds that other regions like Southern Europe, Australia, and New Zealand (ANZ) saw a notable reduction in losses. 

North America

In Q2 2022, North America was Adjusted EBITDA positive and was close to break-even in H1 2022, despite fee caps in the US and Canada negatively impacting Adjusted EBITDA by €73M, reveals the report.  

In July 2022, Just Eat Takeaway.com and Amazon entered a commercial agreement in the US, offering Amazon Prime members a free, one-year Grubhub+ membership. 

Brazil

Brazil’s iFood delivered strong growth in H1 2022. GTV grew 23 per cent, and revenue grew 28 per cent in H1 2022 compared with H1 2021.

Cash equivalents

As of June 30, 2022, the company’s cash and cash equivalents amounted to €882M, sufficient to finance the path to profitability. 

Additionally, the management is working on various options to further strengthen the company’s balance sheet and liquidity position, including a potential sale of assets and refinancing alternatives. 

Losses

The Loss for the period on an IFRS basis was €3.5B, predominantly caused by a goodwill impairment of €3B related to the equity-funded acquisition of Grubhub in 2021. 

“The impairment was due to the reduction in sector valuation comparables and the impact of increases in interest rates and equity volatility on technical valuation metrics,” says the report. 

Loss, excluding the impact of the impairment, amounted to €500M in H1 2022, compared with €486M in H1 2021.

Exploring Grubhub deal

Just Eat Takeaway.com and its advisors continue to actively explore the partial or full sale of Grubhub. 

The decision to sell Grubhub comes after Cat Rock, the second largest shareholder of Just Eat Takeaway.com, criticised the purchase of Grubhub and insisted on selling the company.

On Wednesday, the company wrote down the value of its US subsidiary Grubhub by €3B to sell it. The company also intends to monetise its 33 per cent stake in iFood if an appropriate offer reflects this asset’s size and superior growth. 

Just Eat Takeaway.com acquired Grubhub in a $7.3B deal last year.

COO reappointment

In other news, Just Eat Takeaway.com announced that its supervisory board would nominate Jörg Gerbig for reappointment to its Management Board as COO. 

A couple of months back, the Dutch company announced the withdrawal of the voting to reappoint Gerbig as a Management Board member from the agenda of the Annual General Meeting (AGM).

Before the AGM, a formal complaint was filed against Gerbig, accusing him of personal misconduct at a company event. At the time, the company initiated an investigation under the company’s Speak Up Policy. 

The external expert investigation has now been concluded, and based on the outcome, Jörg Gerbig can continue in his position as COO.

Previous developments

In May, ahead of the AGM, Adriaan Nühn resigned from the supervisory board as chairman and announced that he would not seek re-election. This resulted in Nühn exiting the supervisory board as chairman at the closing of the AGM of the company.

The biggest meal delivery company in Europe announced it would initiate the process of finding a successor for Nühn. In the absence of Nühn, his duties will be assumed by Corinne Vigreux, the vice-chair of the supervisory board.

The company has been facing pressure from investors to turn around its business and consolidate loss-making operations.

A couple of months back, Just Eat Takeaway.com announced its plans to discontinue its platform and delivery operations in Romania as a part of cost-cutting. The company said it plans to focus its efforts on sustainable profits and market-leading positions. 

Just Eat Takeaway: What you need to know

Founded by Jitse Groen and Piotr Czajkowski, Just Eat Takeaway claims to be one of the largest online food delivery marketplaces outside China. It is focused on connecting consumers and restaurants through its platforms. 

The Dutch company also provides its proprietary restaurant delivery services to restaurants that do not deliver. It is connected with nearly 580,000 restaurants and operates in the UK, Germany, the Netherlands, Canada, Australia, Austria, and other countries.