DeliveryHero CEO Niklas Ostberg speaks at the Noah Tech Conference in Berlin on June 13, 2019.

Christian Boxey | Bloomberg via Getty Images

Delivery Hero Shares sank on Monday morning, extending losses from last week, as investors reacted to the company’s early financial results.

Shares were down 8% at one stage during the morning session before paring losses to 4% by 11am London time.

The financials, which were unaudited and released a week ago, show the company grew sales in line with its guidance last year and is forecasting stronger profits in 2024.

DeliveryHero’s decision to share its numbers early was a bid by the company last week to get back at investors flying over its strategy to sell off the food delivery company’s assets.

How the company did it:

Income: Annual 2023 revenue of 10.5 billion euros ($11.3 billion), vs. 10 billion euros expected by analysts, according to LSEG data.

Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization): Delivery Hero says adjusted EBITDA “surpassed” 250 million euros ($269.4 million). Analysts had forecast adjusted EBITDA of 254.3 million euros, per LSEG

Delivery Hero said group GMV (gross merchandise value), which is the combined value of the total orders on its platforms, rose 6.7 percent year-on-year to 12.3 billion euros in the fourth quarter of 2023, an increase of 6.8 percent. to 47.6 billion euros. Throughout the year 2023.

Total segment revenue rose 15.7 percent to $3 billion in the fourth quarter. Full-year sales came in at 11.1 billion euros for the full year, up 15.7 percent year-on-year.

This matches the company’s guidance for “around 15% YoY (year-over-year)” growth in 2023.

Delivery Hero said adjusted EBITDA, which is Delivery Hero’s measure of profitability, totaled more than 250 million euros in full-year 2023, and the company reported an adjusted EBITDA margin of 0.6 percent.

Delivery Hero said the results were due to healthy order growth across many of its geographies.

Notably, Delivery Hero also gave some rosy guidance for 2024, with the delivery company forecasting group GMV growth of 7-9% for the year, higher than its performance in 2023.

Delivery Hero said it expects segment revenue to grow between 15% and 17% in full-year 2024, and adjusted EBITDA of 725 million to 775 million euros.

This will mark three times the profit compared to last year.

Delivery Hero maintains that it can reach this target through incremental order growth to gradually increase its EBITDA margin. The company expects an EBITDA margin of 1.6% in 2024.

Delivery Hero said it would publish additional preliminary numbers for the fourth quarter in a trading update on February 14, when it was originally due to report numbers.

A tough week for the delivery hero

The delivery came after Hero’s share price lost more than 26 percent, to its lowest price since 2022, as investors reacted to a mix of news related to portfolio asset sales. What did

On Tuesday, DeliveryHero said it would sell all of its 4.5 percent stake in British food delivery firm Deliveroo for £76.8 million ($97 million), a much lower price than it paid for the stake in 2021.

Then, on Friday, DeliveryHero’s shares sank sharply after a report said the company had ended talks to sell some assets within its Southeast Asian food delivery business Foodpanda to Singapore’s Grab. .

Delivery Hero denied the report, issuing a statement saying any rumors that negotiations for a possible sale of Food Panda’s assets had ended were “false” and that discussions were ongoing.

Delivery Hero has been particularly active when it comes to mergers and acquisitions over the past year or so – both on the acquisition and divestiture side of things.

The company bought Spanish rival Glovo in 2022 for an undisclosed sum. In the same year, Delivery Hero also sold its stake in German grocery firm Gorilla to rival Gettier, which Acquired the company in its entirety for an undisclosed price.

The company’s belief is that M&A should be used as a tool to unlock strategic value from certain assets rather than acquiring them for a large return and then selling them.

Along with Deliveroo, Delivery Hero sold its shares as their value fell significantly from the price Delivery Hero paid in mid-2021, on a pandemic-driven boom in online food delivery.

DeliveryHero is one of the largest food delivery services globally with 2.2 billion users.

It competes with American company DoorDash, UK’s Deliveroo, Anglo-Dutch firm Just Eat, Singaporean company Grab, and Indonesia-based Gojek.

Leave a Reply

Your email address will not be published. Required fields are marked *