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Wed 18th Jan 2023 - Update: Just Eat, inflation eases despite rising restaurant prices
Just Eat sees UK orders fall 10% in 2022 as adjusted Ebitda accelerates to €150m in second half of year: Just Eat Takeaway generated adjusted Ebitda amounting to approximately €150m – or 1.1% of gross transaction value (GTV) – in the second half of 2022, representing a material improvement from minus €134m in the first half of the year. This was driven by improved revenue per order, delivery costs per order and overheads and operational expenditure. Full year adjusted Ebitda improved to approximately €16m in 2022 from minus €350m in 2021. The second half improvement was driven by the UK and Ireland, North America, southern Europe and Australia and New Zealand. The business processed 65.4 million orders in the UK and Ireland during the fourth quarter, down 10% on the previous year, and 260.3 million in total in 2022, also down 10%. Full-year 2022 GTV was stable at €28.2bn, driven by a higher average transaction value and positive currency movements, which offset lower order volumes. Full-year GTV in the UK and Ireland was down 1% at €6.6bn. The company stated: “Three out of the four operating segments returned to sequential order growth from August 2022 onwards, while the pandemic continued to affect the year-on-year comparison. This reversal was less pronounced in southern Europe and Australia and new Zealand because of the inverse seasonality in the countries. The order decline in North America decelerated in the fourth quarter of 2022. Management will maintain focus on profitability and expects to deliver a positive adjusted Ebitda of approximately €225m in 2023. This guidance includes additional investments in food and non-food adjacencies and wage costs inflation, and takes into account an uncertain macroeconomic environment. Growth in 2023 is expected to be skewed towards the end of the year, given the lower absolute order level of the second half of 2022 versus the first half of 2022. The long-term objectives for Just Eat remain unchanged. The disposal of the iFood stake for the initial consideration of €1.5bn completed in November 2022. Management, together with its advisers, continues to actively explore the partial or full sale of Grubhub. There can be no certainty that any such strategic actions will be agreed or what the timing of such agreements will be. Further announcements will be made as and when appropriate.” Jitse Groen, chief executive of Just Eat Takeaway, said: “Our focus on profitability resulted in a material improvement in adjusted Ebitda, from minus €134m in the first six months of 2022 to approximately €150m positive in the second half of the year. Our improved profitability and strong capital position strengthen our business for further growth and underpin our ability to both deliver on our adjusted Ebitda targets and invest in food and non-food adjacencies.”

Propel’s The Who’s Who of UK Food and Beverage to feature more than 165,000 words of content, launching on Friday: Propel’s The Who’s Who of UK Food and Beverage will feature more than 165,000 words of content when it is launched on Friday (20 January). The database will have the full profiles of more than 650 of the UK’s top food and beverage operators. It is the fifth major database exclusive to Premium subscribers. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database, which will be updated monthly, has taken 16 months to pull together, merging Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium subscribers also receive access to four other databases: the Propel Turnover & Profits Blue Book; the Propel Multi-Site Database, produced in association with Virgate; the New Openings Database and the UK Food and Beverage Franchisor Database. Premium subscribers are also to be given exclusive access to the recording and slides to Propel Multi-Club Conferences. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email to upgrade your subscription. Subscribers also receive access to Propel's library of Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before. 

Inflation eases to 10.5% despite higher prices in restaurants: The rate of inflation eased to 10.5%, according to official figures – down from 10.7% in November. The Office for National Statistics (ONS) said the reduced cost of motor fuels led to the decline in the core consumer prices index (CPI) measure of inflation along with cheaper clothing and footwear, and recreation and culture. Pushing inflation up, the ONS added, were higher prices in restaurants and hotels, food and non-alcoholic beverages. The announcement is the latest signal that the UK might have seen the worst of inflation. The number is down from a 41-year high of 11.1% recorded in October. Economists polled by Reuters had expected a rate of 10.5% for the year up to December 2022. Prices had been rising steadily since late 2021, when supply chain problems linked to covid lockdowns and worker shortages meant demand for goods could not be met. The problem was exacerbated by Russia’s invasion of Ukraine, when countries scrambled to find other energy sources and reduce their use of Russian gas, pushing up the cost of energy and all other goods that require energy input, as a result. The Bank of England has warned that inflation may prove to be more persistent in the UK than other countries.

Devonshire Hotels and Restaurants reports turnover exceeding pre-pandemic levels: Devonshire Hotels and Restaurants, which operates six hotels as well as restaurants and inns in Yorkshire and Derbyshire – as well as a range of holiday cottages – increased its turnover nearly three-fold in the year ended 31 March 2022, while returning to profit as occupancy rates bounced back from the pandemic. The company, which operates the properties on behalf of their owners the Duke and Duchess of Devonshire, recorded a turnover of £11,992,988 compared to £4,058,979 in the previous year, with a profit before tax of £1,707,193 (2021: loss of £1,251,723) and a positive Ebitda of £2,519,000 (2021: negative £475,000). No dividends were paid. The company said that revenue per available room was £148.84, which was 22% ahead of budget, and that this increase alongside higher occupancy was a key factor in driving revenue. In fact, turnover was higher than in the two pre-pandemic years ending March 2020 (£9,924,378) and March 2019 (£10,360,821). Despite the return to form, the directors issued a cautious statement along with the accounts: “The directors anticipate the business environment will remain challenging and competitive. In 2021, we saw recovery from the impact of covid-19 as restrictions were lifted, however the current climate is experiencing high inflation and the UK is in recession. The effects of inflation are being seen in all areas, including wage costs, the cost of food, energy and consumables. Consumer confidence is at a low and this will mean that our consumer-facing operations and conditions will be challenging. Management is monitoring the impact on the business closely, including cash flow forecasting.”

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