Just Eat predicts return to profit after orders soar
Just Eat Takeaway.com said its losses had peaked and it expected to move back into profit after orders increased by more than half in the first six months of 2021.
Combined orders for Just Eat and Grubhub rose 51% resulting in gross transaction value (GTV) of €14.1bn and annual GTV will be €28bn-€30bn, the company said. Losses, caused mainly by fee caps in North America and investment spending, have peaked and Just Eat will "trend back to profitability" the food delivery group said.
Just Eat upgraded its guidance for order growth in 2021 to more than 45% from a previous estimate of 42%. It predicted an adjusted earnings margin of -1% to -1.5% of GTV including the impact of fee caps and €200m of voluntary partner support in North America.
Just Eat agreed to buy Grubhub in the US in June 2020 and completed the deal at the end of June 2021. The company said it would continue to invest in growth and prioritise growth over earnings amid fierce competition from rivals such as Deliveroo.
Jitse Groen, CEO of Just Eat's chief executive, said: "We have combined Just Eat Takeaway.com and Grubhub into one of the largest online food delivery companies in the world. Adjusted EBITDA losses, mainly caused by US and Canadian fee caps and our investment programme, have now peaked. We therefore expect the company to trend back to profitability going forward while retaining significant growth during the second half of the year."
The FTSE 100 company is reviewing the locations of its listings and may not be eligible for inclusion in FTSE indexes when FTSE Russell announces its review of nationality on 1 September, Just Eat said.