(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. Takeaway.com is offering an implied value of 731 pence for each Just Eat share, 15% more than the target company’s stock price on July 26.
The food delivery industry in Europe has become a battleground, with rivals competing on prices and copying each other’s business models. The U.K. is one of most competitive markets, where Just Eat is battling against a growing Uber Eats, which is launching a rival marketplace platform in the U.K. following Deliveroo’s entry 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 marketing 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 Chief Executive Officer 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.
Takeaway also reported Wednesday, where orders for the first half met the average analyst estimate.
Food delivery has been one of the fastest growing industries in the tech sector, and investors have been pumping money into startups in a bid to dominate each market. Both Takeaway.com and Just Eat run marketplace models, connecting users with takeout food but leaving delivery to the restaurants. Uber Eats is launching a rival marketplace platform in the U.K., following the entry of Amazon.com Inc.-backed Deliveroo in mid-2018.
To contact the reporter on this story: Giles Turner in London at [email protected]
To contact the editors responsible for this story: Giles Turner at [email protected], Nate Lanxon
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