Just Eat Avoids Talking Takeaway as Order Growth Returns

(Bloomberg) -- Just Eat Plc posted an improvement in order growth over the first half of the year, but avoided mentioning its ongoing talks with rival Takeaway.com NV.

The U.K. food delivery company reported adjusted earnings before taxes, interest, depreciation and amortization for the first half of 2019 of 72.4 million pounds ($88 million), with orders up 21% year-on-year to 123.8 million. Just Eat reconfirmed full year revenue is expected to come in between 1 billion pounds and 1.1 billion pounds, against analyst estimates of 1.04 billion pounds.

Dutch rival Takeaway revealed on Saturday that it's made a 5 billion-pound all share bid for Just Eat. The Amsterdam-based company also reported earnings Wednesday, posting a 70% jump in orders over the first six months of the year, driven by its $1 billion acquisition of Delivery Hero's German business.

On an earnings call, Chief Executive Officer Jitse Groen also chose to sidestep any question related to a possible deal for Just Eat, keeping the focus on his own company's performance.

Just Eat's shares rose 2.7% in early trading in London, while Takeaway rose 2.8% in Amsterdam.

Growth is a vital metric for both companies, who were both seen as secure incumbents before the arrival of a clutch of well-backed startups. Food delivery has since become one of the fastest growing industries in the tech sector, with rivals sinking millions of dollars to compete on prices and the mechanics behind the ordering and delivery of takeouts.

The U.K. is also one of most competitive markets, where Just Eat is battling against a growing Uber Eats, which is launching a rival marketplace platform across Europe following the entry of Amazon-backed Deliveroo into the segment in mid-2018.

Just Eat has also been grappling with a soft U.K. market, balanced by growth in Canada, Italy, Switzerland and Ireland. Shares of Just Eat fell about 25% over the past six months, prior to Takeaway.com's bid.

To counter slowing growth, Just Eat has been boosting its advertising spend. Group marketing spend over the first half was 83.8 million pounds, up 21% year on year.

Expectations of a counterbid to Takeaway have also waned. Delivery Hero SE CEO Niklas Oestberg on Tuesday poured cold water on speculation it may approach Just Eat, saying the company has plenty of growth potential as it expands its offering to challenge Amazon.com Inc. in local shipments.

To contact the reporters on this story: Giles Turner in London at gturner35@bloomberg.net;Wout Vergauwen in Amsterdam at wvergauwen@bloomberg.net

To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Nate Lanxon

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