Just Eat Takeaway.com NV on Wednesday reported much improved profitability in 2023, despite lower orders and revenue, saying it expects positive cash flow and higher adjusted earnings in 2024.

The Amsterdam-based online food delivery ordering platform also said it continues to try to sell some or all of its Grubhub business in the US. The company purchased Grubhub in 2021, soon after the merger of the UK’s Just Eat and Takeaway.com in the Netherlands.

Just Eat shares were down 6.1% to 1,206.00 pence on Wednesday morning in London.

Just Eat said its pretax loss narrowed substantially to €2.07 billion in 2023 from €5.77 billion in 2022. Adjusted earnings before interest, tax, depreciation and amortisation were €324 million, up from just €19 million.

The improved profitability was despite the top line sagging a bit last year. Revenue was €5.17 billion, down 7.1% from €5.56 billion. It was down by 5% at constant currency, Just Eat said.

As announced last month, total transaction value fell by 6.4% to €26.4 billion from €28.2 billion, or down 4% at constant currency. Total orders declined by 9.5% to 891 million from 984 million, but average transaction value increased by 3.5% to €29.67 from €28.66.

Commenting on the results, Albie Amankona, an analyst at Third Bridge, said: ‘Our experts say increasing transaction volumes in the grocery sector is crucial for boosting average basket size and enhancing profitability. Margins in food delivery are extremely tight.’

Looking to 2024, Just Eat guided for adjusted Ebitda of €450 million and continued positive free cash flow. It expects 2% to 6% growth in gross transaction value, when excluding North America.

Just Eat said it continues to ‘actively explore’ the sale of its business there, Grubhub. In 2023, revenue in North America was €2.14 billion, down 16% from €2.55 billion in 2022, or down 13% at constant currency. Adjusted Ebitda in North America was €126 million, up from €65 million.

‘Under the new management, we are improving our cost base and competitiveness of Grubhub, including a continued push in new verticals,’ Just Eat said. ‘Grubhub too continues to make strong progress towards free cash flow breakeven.’

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