German online takeaway food company Delivery Hero has forecast single-digit percentage growth in 2023 gross merchandise value (GMV) against a challenging comparison period after parts of Asia reopened from lockdowns.
The Berlin-based company expects its GMV to grow between 5% and 7% in constant currency terms this year, citing a "promising start" to the second quarter. It expects the growth to accelerate throughout the year.
After a pandemic-driven boost to growth, Delivery Hero has focused on reaching long-awaited profitability as investor confidence in the rapidly expanding but mostly unprofitable sector started to wane.
"We are not focusing on cutting costs, we are much more concentrated on improving our gross profit," finance chief Emmanuel Thomassin told Reuters.
The company said it seeks to drive profitability by growing its customer base and expanding its business beyond food delivery services.
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First-Quarter Highlights
In the first quarter, Delivery Hero's GMV grew by an average of 16% in all regions except Asia that includes its core market South Korea.
GMV in Asia declined by 7%, affected by 'difficult' comparables from last year when strict COVID-19 lockdowns were still enforced.
Delivery Hero shares were down 3.7% at 08:23 GMT.
"An innately volatile equity trading in innately volatile times, we'd expect some weakness today," analysts at Jefferies said.
Outlook
Delivery Hero expects to record double-digit growth in Asia by the end of 2023, Thomassin said, but added growth would stay below other regions.
"We are increasing profitability in every single market where we were profitable last year," he said.
The company reported a GMV of €11.2 billion ($12.39 billion) in the first quarter, up 2.1% on a constant currency basis and in line with analysts' consensus estimate.
It confirmed full-year outlook for a core profit (EBITDA) to GMV margin exceeding 0.5%.
