Food delivery group Just Eat (JE.) reported 25% revenue growth in the three months ended 30 September as management reiterated full-year revenue guidance of £1bn to £1.1bn. The growth rate implies a slowdown compared with the first half and the shares traded down 4.3% to 598p in response.

Interim chief executive Peter Duffy said the company was ‘seeing strong growth in many of our markets, including Canada, Europe and pleasingly Australia, where we are starting to reap the benefits of our turnaround plan.’

Just Eat agreed an all-share merger with on 5 August to create one of the largest food delivery companies in the world. A circular will be sent to shareholders by the end of the month and the transaction is expected to be completed by the end of the year.

The shares are 18% below the agreed 731p offer price indicating that shareholders aren’t entirely comfortable with the tie-up. It’s also possible that some shareholders have been selling ahead of the share swap, if their investment mandates do not allow them to hold European shares. Either way the upcoming shareholder vote will be closely scrutinised.

In the crucial UK market orders increased by 8% to 33m although the company highlighted a ‘softer consumer spending backdrop’.

Full-year earnings before interest, tax, depreciation and amortisation (EBITDA) expectations are in the £185m to £205m range, which excludes Brazil and Mexico which are forecast to produce EBITDA losses in the range of £80m to £100m.


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Issue Date: 21 Oct 2019