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Top man Jitse Groen has to explain to American investors in New York on Thursday about a ski trip worth almost 15 million euros, while the meal courier company suffers a loss of one billion.
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The Dutch CEO of Just Eat Takeaway
leaves for New York next week to meet outraged investors. His trip is not a walk in the park: his company is suffering from pandemic indigestion. During the pandemic, companies such as meal couriers Just Eat Takeaway experienced a boost as many people ordered meals online. But now that restaurants and other eateries have reopened, meal delivery drivers are struggling to maintain the momentum. Last week, Deliveroo’s first quarter figures showed that orders were lower than expected.
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The essence
- The CEO of Just Eat Takeaway will speak to angry investors in New York next week.
- The reason is a ski trip worth almost 15 million euros for 5,400 employees.
- Just Eat Takeaway has been under pressure for months due to disappointing results.
- Investors also want an explanation about the future of the American concern child Grubhub.
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Moreover, these courier companies focus on volume growth rather than profitability. Last year, Just Eat Takeaway suffered a net loss of 1 billion euros, seven times more than the year before. The patience of investors with these loss-making companies is gradually running out as interest rates rise. The price of Just Eat Takeaway is also under heavy pressure. In one year, the stock has lost 70 percent of its value as investors no longer trust the company’s strategy. This makes that share the worst performing in the AEX index.
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Swiss getaway
By inviting 5,400 employees on a four-day ski trip to Arosa, Switzerland, an event with a price tag of 14.7 million euros, Groen has added fuel to the fire. “We understand that these are challenging times. But for that very reason it is even more important to organize Snow Fest and to show our employees that we appreciate how hard they work,” said a spokesperson about the outing.
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But for some investors, it’s the proverbial straw. The activist investor Lucerne Capital Management, which is also in Telenet’s capital, will vote against the reappointment of the financial director at the upcoming general meeting. That is a clear signal to the board of directors to express our disappointment.
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American worry child
The American investors also want to hear from Groen next week what plans he has with the acquired Grubhub. Just Eat Takeaway put 7.3 billion dollars (6.4 billion euros) on the table in October last year to take over the American meal delivery company and thus enter the American market.
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All meal platforms have indicated that the first half of the year will be tough. And at Just Eat, the sentiment is the most subpar.
Andrew Porteous
Analyst at HSBC
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But Grubhub is underperforming, which has led to negative sentiment around Just Eat Takeaway’s share. A shareholder activist has previously called on management to undo the billion-dollar deal, because investors value Grubhub at zero dollars. Analysts expect the company to lose $238 million this year.
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No direct consequences
This applies not only to the American subsidiary of Just Eat Takeaway, but to the entire sector. “All those meal platforms have indicated that the first half of the year will be tough,” said HSBC analyst Andrew Porteous. “And at Just Eat, the sentiment is the most subpar.” The analysts are not really surprised by the blows on the stock market.
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A minority will vote against at the general meeting, but rather as a sign of disappointment and rebellion.
