Top story

German food delivery group Delivery Hero lost almost €1.5bn in its first half after rising marketing, technology and impairment costs increased its losses.

After issuing top-line second quarter numbers last week, the firm posted its first half accounts this morning.

The full interim accounts show overall losses for the six months to 30 June rose to €1.47bn from €1bn a year ago on revenues up 55% to €3.8bn.

Group gross sales rose 50.4% to €20bn, mainly driven by the organic growth across the segments and the acquisition of Asian group Woowa in March 2021.

Adjusted EBITDA improved from to a loss of €323m from €350.8m a year ago.

The group said it saw increased a 25% increase in marketing costs, primarily restaurant acquisition costs, while IT expenses almost doubled due to increased headcount.

‘Other operating expenses’ increased to €284m from just €21m a year ago, respresenting write-downs in fair value of investments.

Looking forwards, it anticipates a significant increase in full year total segment revenue to more than €9bn – although this is a downgrade from its previous guidance of above €9.5bn.

This growth should be driven by an increase in GMV compared to 2021, which should rise to at least €41bn (previously €44bn).

For the Group’s platform business it expects adjusted EBITDA to improve significantly and in total to generate a positive adjusted EBITDA for the full year 2022.

The adjusted EBITDA to GMV margin of the Group is also expected to be slightly better than anticipated with negative 1.0% or better.

It cautioned: “Due to the fact that we are operating in a relatively young and still rapidly evolving industry any forecast on the earnings trajectory is subject to considerable uncertainty.

“Adjusted EBITDA is dependent not only on factors that can be impacted by Delivery Hero, but also on those over which it has no influence. For example, if the Group was forced to defend its position against new competitors in specific markets or to react to revenue downturns, then measures that may not have been scheduled previously may have to be implemented (e.g., increasing marketing expenditure) which can result in a negative development of adjusted EBITDA which deviates significantly from the previous estimate.”

Last week it said in Q2 2022, it reached a Gross Merchandise Value € 9.9bn (+18% YoY), while total segment revenue grew by 38% to €2.1bn.

For Q3 2022, Delivery Hero anticipates a GMV growth of 7% quarter-on-quarter €10.6bn (or €11.5 billion including newly acquired delivery group Glovo).

Its shares are down 1.6% this morning to €47.10.

Morning update

On the markets this morning, the FTSE 100 has rebounded 1.8% to 7,532.7pts so far this morning.

Risers include Bakkavor, up 5.8% to 93.1p, Nichols, up 4.5% to 1,165p and McBride, up 3.5% to 23.8p.

Fallers include THG, down 1.5% to 60.5p, Just Eat, down 1.6% to 1,590.4p and Deliveroo, down 1.6% to 82.8p.

Yesterday in the City

The FTSE 100 slipped back another 0.2% yesterday to close at 7,471.5pts after its third consecutive day of losses.

On a day with market news, fallers included Parsley Box, down 3.3% to 10.4p, Nichols, down 2.6% to 1,115p, PZ Cussons, down 1.1% to 199.8p and Hilton Food Group, down 1% to 1,002p.

Risers included Coca-Cola Europacific Partners, up 1% to €52.80 and Cranswick, up 0.6% to 3,050p.