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Delivery Hero experiences a continuation of last week’s share value decline as investors respond to the company’s early release of unaudited preliminary results. The move is an attempt to counteract investor concerns arising from the recent asset sales strategy. While the financials align with the company’s guidance, the market’s response remains skeptical.
Preliminary Financial Highlights:
- Revenue: Delivery Hero reports annual 2023 revenues of 10.5 billion euros ($11.3 billion), surpassing analyst expectations of 10 billion euros.
- Adjusted EBITDA: The company states that adjusted EBITDA “exceeded” 250 million euros ($269.4 million), slightly below the analysts’ forecast of 254.3 million euros.
- GMV (Gross Merchandise Value): Group GMV grows by 6.7% YoY to 12.3 billion euros in Q4 2023 and by 6.8% to 47.6 billion euros for the full year, in line with the company’s guidance of around 15% YoY growth.
- Segment Revenue: Total segment revenue increases by 15.7% to 3 billion euros in Q4, reaching 11.1 billion euros for the full year, matching the company’s 15% YoY growth guidance for 2023.
- Profitability: Adjusted EBITDA for full-year 2023 surpasses 250 million euros, with an adjusted EBITDA margin of 0.6%.
Guidance for 2024:
- GMV Growth: Delivery Hero forecasts a 7-9% growth in group GMV for 2024, outperforming its 2023 performance.
- Segment Revenue: Expectations include segment revenue growth of 15-17% for full-year 2024.
- Adjusted EBITDA: The company anticipates an adjusted EBITDA range of 725 million to 775 million euros, tripling profits from the previous year.
- EBITDA Margin: A target EBITDA margin of 1.6% is set for 2024.
Background and Investor Concerns:
Delivery Hero faced a tumultuous week with a more than 26% drop in share value, triggered by news related to portfolio asset sales. The decision to sell its entire 4.5% stake in Deliveroo and rumors surrounding the potential collapse of negotiations to sell certain assets within its Southeast Asian food delivery business, Foodpanda, contributed to investor skepticism.
Strategic Moves and Future Outlook:
Despite the recent challenges, Delivery Hero remains active in mergers and acquisitions, believing in the strategic value of certain assets. Acquisitions, such as Spanish rival Glovo, and divestments, like the sale of its stake in German grocery firm Gorillas, reflect the company’s dynamic approach.
Delivery Hero, one of the largest global food delivery services, competes with industry giants like DoorDash, Deliveroo, Just Eat Takeaway.com, Grab, and Gojek. The company’s positive outlook for 2024 aims to instill confidence amid ongoing market uncertainties.
Additional preliminary numbers for Q4 are expected in a trading update on Feb. 14, the original reporting date.