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Bloomberg
Delivery Hero SE sought to reassure investors with an accelerated plan to reach profitability by next year driven by its Asia business despite a broader slowdown in the food delivery industry.
While growth has eased following a pandemic surge, the Berlin-based company said it will generate positive adjusted earnings in fiscal year 2023. It also forecast the value of transactions on its platform will grow 7% this quarter from the second quarter.
Delivery Hero’s Asia segment already generated positive adjusted earnings in the second quarter, it said. Shares rose in early trading in Frankfurt. The company hasn’t set a timeline for generating free cash flow yet but an update may come soon, according to CEO Niklas Oestberg. “The path is pretty clear,†he said.
Last month, Delivery Hero cut its outlook for sales and orders for the year, joining others in the the industry that have slashed growth projections. However, the company also said it would buy back convertible bonds and that its margins would be better than expected.
Competitors such as Deliveroo and Just Eat Takeaway.com previously announced plans to boost revenue and cut costs as orders decelerate after a period of rapid growth during lockdown restrictions.