Online takeaway company Just Eat reports results, but a potential takeover tops the menu.
Half-year results to 30 June 2019
- Revenue up 30% to £464.5 million
- Orders up 21% to 123.8 million
- Adjusted profit (EBITDA) down 16% to £72.4 million
- Net cash generated by operations down 15% to £65.9 million
- Full-year guidance maintained
Interim chief executive Peter Duffy said:
"We've been working at pace and made good progress in the first half of the year to become the preferred food delivery app for our customers, with a broader choice of restaurants, a better user experience and a more personalised and impactful approach to communication. Performance in our UK business strengthened in Q2, our Canadian and European businesses are performing well and Australia has returned to top line growth with our delivery operations achieving gross profitability. These are strong foundations for Just Eat to build on, as the business continues to drive forward."
Founded by five Danish entrepreneurs in 2001, Just Eat (LSE:JE) launched in the UK in 2006 and came to the stock market in 2014 at 260p per share.
Today, the company which gives consumers online access to a host of restaurant takeaways, has over 26 million customers and more than 100,000 restaurant partners. It works in the UK, Australia & New Zealand, Canada, Denmark, France, Ireland, Italy, Mexico, Norway, Spain, Switzerland and Brazil.
Earlier this week, Just Eat confirmed it was in talks about a possible all-share takeover by Takeaway.com. Listed on Euronext in Amsterdam, Takeaway.com is a major online food delivery marketplace in Continental Europe and Israel with nearly 44,000 connected restaurants.
The combination would create one of the world's largest online food delivery platforms with 360 million orders worth €7.3 billion in 2018.
Just Eat delivered mixed progress in these half-year results. While revenues rose by 30%, profits were reduced by the cost of investments made for accelerated and targeted rollout of delivery services.
Full-year guidance for both revenue and adjusted profits was reaffirmed.
The share price rose by over 2% in mid-morning UK stock market trading.
From a standing start in 2001, Just Eat has come along way. The company and its rivals have revolutionised the takeaway business. A choice of food to be delivered to the door is now just a few clicks away on a mobile phone.
For investors, news of a takeover saw Just Eat's share price jump by over 20%. The two companies do not have any significant geographical overlap, making them a sensible fit. In the face of intensifying competition, size matters, and today's results have been overshadowed by the bid talks.
- A takeover would create one of the world's largest online food delivery companies
- Strong revenue growth – up 43% in 2018
- International expansion
- Lacks current leadership
- Intensifying competition- Amazon.com Inc (NASDAQ:AMZN) has an interest in Deliveroo
- Latin American operations expected to report full-year losses
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