Merger bites Just Eat profit

FOOD delivery firms Just Eat and Takeaway.com have reported a fall in profits ahead of their £9bn merger.

The British and Dutch companies said earnings took a hit as they ploughed money into their operations to take on rivals such as Deliveroo and Uber Eats.

The firms plan a global food deliveries giant 52.2pc controlled by Just Eat shareholders.

Yesterday, in its first results since announcing the plan, Just Eat said it was ramping up its rollout of delivery services in its key UK and Australia markets. It said performance was also strong in the rest of Europe and Canada, while also cheering delivery deals with bakery chain Greggs and supermarket Asda.

Just Eat said sales surged 30pc to £464.5m in the six months to June 30, with total orders up 21pc to 123.8m.

But profits fell from £48.1m to just £800,000 as it ploughed cash into expanding its delivery operations as well as iFood, its joint venture in Brazil.

Just Eat interim boss Peter Duffy said: ‘We’ve been working at pace and made good progress in the first half of the year to become the preferred food delivery app for our customers, with a broader choice of restaurants, better user experience and more personalised communication.’

Takeaway reported a 68pc rise in sales to £170m and its first profit, of £1.6m, since it listed in Amsterdam three years ago.

That was helped by its £850m takeover of German rival Delivery Hero earlier this year. Takeaway boss Jitse Groen said expansion – not profitability – was his priority. Just Eat shares rose 1.5pc, or 11.4p, to 761.4p.