German online takeaway food company Delivery Hero has reported slightly lower-than-expected gross merchandise value (GMV) for 2022, citing foreign currency effects and its intensified focus on profitability.
It reported a GMV of €44.6 billion for the year, up from €37.97 billion a year ago but below analysts' average estimate of €44.87 billion in a company-provided poll.
After a boost to growth during the COVID-19 pandemic, Delivery Hero has focused on reaching long-awaited profitability as investor confidence in the rapidly expanding but mostly unprofitable sector started to wane.
The Berlin-based company confirmed its 2023 guidance for a positive margin on adjusted core earnings (EBITDA) to GMV of over 0.5%, while it still targets free cash flow break-even during the second half of 2023.
In the fourth quarter, GMV increased by 9% year-on-year to €11.4 billion, while total segment revenue reached a 21% year-on-year increase hitting €2.5 billion.
“We have wrapped up another successful quarter," commented Niklas Östberg, CEO and co-founder of Delivery Hero. "We were able to improve our market position in almost all key countries, while significantly improving our profitability.
"This was driven by cost focus, increased operational efficiencies, as well as our high margin AdTech business, which grew revenues to a run rate of €750 million in the fourth quarter.”
Shares in the food delivery firm slid 0.4% in Lang & Schwarz premarket trade and are seen among the worst performers on the German midcap index.
The Glovo and Woowa owner has operations in over 70 countries across Asia, Europe, Latin America, the Middle East and Africa.