Just Eat offers tasty profits increase despite lower orders

Just Eat Takeaway.com.com NV (LSE, NASDAQ:GRUB), reported a 12% drop in fourth quarter orders, but a much better picture of profitability as it updated investors about trading Wednesday.

According to the online food delivery company, its focus on profitability led to adjusted EBITDA of €150mln for the second half fiscal year 2022. This is a significant improvement from the €134mln loss in the first half.

This was due to higher revenue per order, lower delivery costs per order and reduced operating expenses. Full-year adjusted EBITDA rose from minus €350mln 2021 to €16mln 2022.

Just Eat shares rose 12.25% in the early trading after the news.

According to the company, North America, South Europe, and ANZ (Australia, New Zealand, and the United Kingdom and Ireland) contributed the most absolute amounts to the second-half improvement.

The full-year 2022 total transaction values were stable in comparison to €28.2bn the previous year. This was due to a higher average transaction price and positive forex movements that offset lower order volumes.

Just Eat reported that three of the four operating segments have returned to sequential order growth since August 2022. However, the pandemic continues to impact the year-on-year comparison.

The company stated that a continued focus on profitability will result in a positive adjusted EBITDA (equivalent to €225mln) in 2023. This includes additional investments, wage inflation, and taking into consideration an uncertain macro-economic climate.

The group stated that growth in 2023 will be lower towards the end of this year due to the lower absolute order of the second half than the first.

Jitse Groen (CEO of Just Eat Takeaway.com) stated that “Our improved profitability, strong capital position, and our ability to deliver on our Adjusted EBITDA goals and invest in non-food adjacencies underpin our ability both to deliver on our targets and support our ability t achieve further growth.”

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