Just Eat parent suffers €3.5bn write down on US business in H1

Revenues grew 7% to €2.8bn (£2.3bn) in H1, and adjusted EBITDA also grew by 29% from a loss of €189m (£157.96m) to a loss of €134m (£111.99m)

Just Eat Takeaway has reported a loss of €3.5bn (£2.9bn) in the first half of 2022 (H1), due to an impairment of €3bn (£2.5bn) from the acquisition of US rival Grubhub in 2021, the impact of increasing interest rates and equity volatility on technical valuation metrics. 

However, the company expects profitability to continue improving going forward and is maintaining its outlook for FY22. Just Eat expects GTV to grow by mid-single digits, the adjusted EBITDA margin to be in the range of -0.5% to -0.7% of GTV, and positive adjusted EBITDA to be reached in FY23.

Exiting the pandemic caused a 7% year-on-year drop in orders in H1 2022, which was offset by higher larger orders and higher prices.

This led to “stable” GTV at €14.2bn (£11.86bn) and revenue growth of 7% to €2.8bn (£2.3bn) in H1, and adjusted EBITDA also grew by 29% from a loss of €189m (£157.96m) to a loss of €134m (£111.99m).

Losses have narrowed in all locations, and North America was close to adjusted EBITDA break-even in H1 2022, despite fee caps in the US and Canada negatively impacting adjusted EBITDA by €73m (£61m).

Meanwhile, the UK and Ireland saw adjusted EBITDA improve 70% to -€18m (£15m), and Brazil’s iFood saw 23% GTV growth in H1 2022 and revenue growth of 28%.

However, Southern Europe, Australia and New Zealand saw “notable” reduction in losses from -€149m (£124.6m) to -€110m (£91.99m) in H1 2022.

Looking ahead, Just Eat said it continues to actively explore the partial or full sale of Grubhub, and intends to monetise its 33% stake in iFood if an appropriate offer is made that “reflects the size and superior growth of this asset”.

Jitse Groen, CEO of Just Eat Takeaway, said: “After a period of exceptional growth, Just Eat 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% 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.”

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