Just Eat’s earnings beat estimates after cost controls

Delivery firm have cut their costs and improved operational efficiency

Its operations across Ireland and the UK account for 27% of the total Just Eat Takeaway.com orders. Picture: Naoise Culhane

Delivery firm Just Eat's first-half earnings beat analyst estimates as the European food delivery firm works at trimming costs and improving operational efficiency.

Adjusted earnings before interest, taxes, depreciation and amortization came in 42% higher at €203m in the first six months of the year, the Amsterdam-based company said. That was above the €196.6m average estimate from analysts in a Bloomberg survey.

Just Eat’s shares rose as much as 11%, the biggest intraday gain since November. They were trading 9% higher in early trading yesterday.

The food delivery firm’s courier costs, which mainly include the cost of engaging workers through agencies and third-party delivery companies, decreased in the period. It reduced the cost per order by simplifying its delivery model in the UK, the company said in the statement.

Irish operations

Its operations across Ireland and the UK account for 27% of the total Just Eat Takeaway.com orders and 26% of the total gross transaction value (GTV) during the first six months of 2024. UK and Ireland revenue grew by 7% to €672min H1 2024 from €629m in H1 2023, broadly in line with GTV growth.

The total value of orders placed on Just Eat’s platform came in at €13.2bn in the first half, beating estimates. The northern Europe and UK and Ireland regions posted growth in gross transaction value during the period, while North America and southern Europe and ANZ regions declined.

Just Eat said that on a per-order basis, the compensation to its delivery couriers increased in North America and Northern Europe due to legislative impacts and increases in minimum wages while the courier cost per order in the UK and Ireland notably decreased due to the simplification of operations, Just Eat said.

The company has been looking to boost orders by expanding its customer base through loyalty programs and partnerships. It has also diversified into adjacent segments such as grocery, health and beauty in recent quarters.

“The end of the pandemic has changed the horizon” of some of the units, Just Eat’s Chief Executive Officer Jitse Groen said in a call with reporters. “We are always open to M&A in the geographies in which we are active,” he said.

Just Eat recently announced plans to end operations in New Zealand. It also intends to exit the French market. The company maintained its outlook for the year and announced a share buyback program of up to €150 million.