Earnings Transcript for JTKWY - Q2 Fiscal Year 2021

Operator: Good morning, ladies and gentlemen. Thank you for holding, and welcome to the Just Eat Takeaway.com First Half Year 2021 Results Call. [Operator Instructions] I would now like to hand over the conference to Mr. Jitse Groen. Please go ahead, sir.

Jitse Groen: Thank you, operator, and good morning, everybody. Welcome to this analyst and investor conference call to discuss the half year results for Just Eat Takeaway.com. And on our corporate website, you can download our press release and the slides for this analyst and investor conference call. I will start off today's presentation by taking you through the business and financial highlights for the first 6 months of the year, and I will share some additional background on the results of our investments in sustainable growth. Jörg Gerbig, our Chief Operating Officer, will give you an update, including some market share data, and Matt will specifically address the U.S.. Brent Wissink, our CFO, will then talk you through the financial details of the results at group level and for each of our operating segments individually. I will end the presentation with our guidance for the full year and some concluding remarks. After which, we will open up the call for your questions. My fellow Board members, Brent Wissink, Jörg Gerbig and Matt Maloney are also here to answer your questions. Please follow me to Slide 4. Just Eat Takeaway.com is the #1 food delivery app in Europe, Canada, Australia, and it is a major player in the United States. In our #1 market in Europe, our online food delivery share is roughly 70%, 7-0 percent. Many of our businesses are already consistently profitable. With regards to our investments, we are agnostic about the model that is used, whether that is marketplace, delivery or delivery -- or a hybrid model. In the end, we want to provide the choice that consumers want independent of whether restaurants are delivering themselves or if we have to provide the delivery service. Delivery is already profitable in Canada and in the U.S. when excluding temporary fee caps. Although unit economics in Europe are more challenging, delivery is close to gross profit neutral when we exclude our current investments in the U.K. We expect to further improve the profitability of delivery, driven by our increased scale, logistics optimizations and delivery fee improvements. Our strategy is focused on investing in markets that are or will grow into profitable market leadership positions as we believe that only market-leading positions will return to profit. New York City is one of our strongest and most profitable market and one of the main reasons to acquire Grubhub. The legacy Just Eat markets were historically underinvested and following our investments into these markets, which started in the second half of last year, U.K. and Canada have already been turned around. As a result of our cemented leadership positions, our adjusted EBITDA will increase going forward. As stated previously, we don't consider our partial ownership of iFood as a market-leading position, and therefore, we still intend to divest our stake if an appropriate offer is made. Now please follow me to the next slide. The combination of Just Eat Takeaway.com and Grubhub is one of the largest food delivery companies on this planet. The map shows a global footprint and the #1 positions that we hold in Canada, across the major European markets, Israel and Australia. Slide 6, you will see how this translates into our half year results. We serve nearly 100 million active consumers by the end of June, an increase of 21% year-on-year. Our percentage of returning active consumers increased further to 67%, while the number of orders per active consumers grew significantly to 2.9x per month, mainly driven by our enhanced restaurant offering and investments in growth. This resulted in 547 million orders, representing a GTV of €14.1 billion in the first half of 2021, up 50% on a constant currency basis compared with the same period of 2020. We generated revenue of €2.6 billion, up 52% compared with the first half of 2020. Adjusted EBITDA on a combined basis for Just Eat Takeaway.com was minus €190 million in the first 6 months 2021 representing an adjusted EBITDA margin of minus 1.3% of GTV, reflecting our significant investment efforts. Brent will further elaborate on the financials in the financial section of this presentation. As a reminder, our investments are focused on the acquisition of new consumers and adding new restaurants to our platform to drive powerful network effects to compound the growth of our market-leading positions. Throughout this presentation, you can see that we specifically target these drivers with our investments. Please follow me to Slide 8. Our investment efforts in the historically underinvested legacy Just Eat markets are built on 3 strategic pillars

Jorg Gerbig: Thanks, Jitse, and good morning, everyone. As Jitse just talked about, our strategy is to build clear market leadership in every country so that we can benefit from positive network effects that characterize the food delivery sector and which provide a strong tailwind to growth for the #1 player. In this section, I want to give a little more color about our performance in key markets and how our investments are helping to reinforce and extend our market leadership globally. Please turn to Slide 16. In Europe, JET has an unrivaled position. We have roughly a 70% market share of online food delivery and are multiple times larger than the next largest player. Over 95% of our GTV in Europe is generated from countries where we have a clear market leadership position, including the U.K., Germany, Netherlands and Poland. That market strength also translates to our brand, and JET has a very high top-of-mind brand awareness across Europe, as shown on the chart on the right. As you can see, in many markets, our awareness is more than double that of the nearest competitor, which makes a real difference when it comes to which brand customers choose to make an order from. As we've talked about before, ordering food delivery is typically a very spontaneous decision. So being our customers' first choice is really important to us. We've continued to invest to improve our top-of-mind brand awareness. We've increased our marketing share of voice and legacy Just Eat markets, which were historically under-invested and have also agreed major regional partnerships to leverage our brand strength across Europe, including sponsoring the EUROs and UEFA Champions League. We've seen very strong results already in our brand metrics and expect this to further improve over the coming months and years. Please move to Slide 17. I want to focus on the U.K., where we have seen very strong growth as a result of our additional investments. We've invested in a number of areas. First, we've massively scaled our logistical business, including rolling out of QSRs. McDonald's, for example, we grew to over 1,000 branches across the U.K. and Ireland and now are fully at scale. We are convinced about network effects created with these additions of QSRs and the positive contribution to marketplace that comes with it. QSRs, amongst other things, have impacted our gross margin though and contributed towards a net €55 million decline in EBITDA in H1 2021. Second, we have invested significantly in price leadership, including offering free delivery in London and very low delivery fees for a number of key brands nationwide. This accounted for €77 million of EBITDA investment in H1 2021. Given the widening price gap and improved competitiveness versus competition, we have flexibility around pricing and have already reduced this investment during the second half. And finally, we've also invested in our sales and marketing to step change our restaurant supply and our new customers as well as launching our employed logistics model in a number of U.K. cities, including London, Birmingham and Manchester. This has driven €43 million of increased costs between H1 2020 and H1 2021. In combination, these investments have transformed our performance in the U.K. Total orders increased by 76% between H1 2020 and H1 2021, and we also added almost 50 million orders additionally, in terms of delivery during that period, which represents a phenomenal 733% increase year-over-year. We now fulfill more than twice as many orders as in 2019. Turning to Page 18. We can see that this investment in our network effect has made a big difference in all of the underlying drivers of growth. Our active restaurant estate has grown by almost 40% to 58,000, which makes us the largest player in the market on a like-for-like basis. We also increased our active customer base to 17.5 million, a 23% drive and our average monthly order frequency to 3.2, which represents a significant step change from H1 2020. We've also maintained this increase in frequency despite recent relaxations in COVID restrictions. Please move to the next slide. This slide shows our share based on online metrics. On the left is Google Trends, which we believe is a good proxy for new customers. And on the right, the data is from SimilarWeb, which is more indicative of orders. What we can see is that in both charts, Just Eat has not only stabilized historic declines in share, but also has started to reverse the trend and gained share during the last few months. In fact, if we dig deeper into the data from SimilarWeb, there are a number of positive trends that we are seeing about our customer loyalty. Just Eat has best-in-class returning customer behavior in June 2021 at 76% compared to about 70% for the #2 and #3 player. That number has increased by 600 basis points since the start of the investment program. Just Eat has also the highest proportion of customers who exclusively use that site with 58% versus 45% and 38% for the #2 and #3 player. And Just Eat has also the lowest bounce rate at around 5% compared to 15% for our competitors, which suggests that we have a better ROI on our PPC spend. On the right-hand side, this chart shows our total orders for U.K. and Ireland combined for comparability purposes. What this shows is that based on H1 reported results, we fulfilled twice as many orders as the #3 player in the market. We also gained market share in terms of GTV on both a relative and absolute basis with 9% growth quarter-over-quarter versus 8% growth for the #3 player. We are really encouraged by this data which we believe strongly supports our investment case. This is also further supported by Slide 20. This page shows data from credit card transactions and clearly demonstrate that on a national level, Just Eat is growing faster in absolute terms than competitors and widening the gap in terms of orders. On the right-hand side, we can also see that this significantly closed the market share gap in London and have gained around 10 percentage points since the start of our investment program. There's still further to go, and we know that we need to continue to expand supply, improve top-of-mind brand awareness and enhance customer experience. However, this gives us real confidence that our investments are paying off and that we are on the right track to success both in London and in the U.K. as a whole. Turning to the next slide. We're now moving on to Germany. Our performance in Germany continues to be very strong. Over the last year, we've grown orders by over 60%, processing nearly 80 million in the first half. Our GTV has also increased by 77% during this period, and we've increased our EBITDA from €58 million in H1 2020 to €94 million in H1 2021. Delivery has grown at triple-digit growth rates and is now at significant scale. Our delivery operations is approximately 5x and our total German business approximately 70x larger than the Delivery Hero logistics operation when it was acquired by us in April 2019. We now have 30,000 restaurant partners in Germany with 20% of these made up by delivery restaurants. We are also partners with all of the large chains in Germany, and we are continuing to expand our logistics footprint to more cities. From a consumer perspective, we have an unrivaled brand awareness in Germany with top-of-mind brand awareness reaching almost 70% and aided brand awareness at around 90%. And finally, to put our size in perspective, our German business is more than 30% larger than the whole European business and almost the same size in terms of GTV as the whole European and the Americas business as one of our competitors who now just reentered the German market. Please move to Page 22. The next 2 slides in this section show our online share metrics for a few of our key markets. We have been experiencing competition for many years from various national and international players, as you can see from the chart and the dates when they entered the market. Looking first at our major profit pools in Germany, Canada and Netherlands, we can see that we continue to defend and reinforce our clear #1 position in these markets. In Germany, we have seen a couple of new entrants into that market over the last 12 months. However, neither of those have made significant inroads and JET continues to attract the majority of new users as indicated by Google Trends, and to the extent our lead in terms of absolute orders as indicated by SimilarWeb visits. Canada continues to be a highly competitive market, but we've been able to hold our share and market leadership position. In absolute terms, we believe we've grown orders faster than competitors over the last 12 months. We've also expanded our convenience grocery operations with the launch of SKIP Express Lane, as Jitse mentioned, a backdoor model that will complement our existing partnerships with convenience retailers. We expect this to be profitable in line with the rest of delivery in Canada. In the Netherlands, the story is very similar. Our market position is very strong, and we continue to outpace our competitors in absolute terms despite the largest competitors being present in the market since 2015 and 2016, respectively. In combination, these 3 markets will continue to support top line growth and generate significant profits. Please turn to the next slide. On this slide, we show the same data for Australia, Poland and Italy. Across all of these markets, we continue to outpace and outperform our competitors. In Australia, particularly, we have made significant gains over the last 18 months and now are the market leader in online food delivery. In Poland, we have continued to maintain our #1 position, whilst Italy remains a very strong market for us, and we remain the only player to have successfully transitioned to a fully employed logistics model. Our continued leadership in these and many other markets are a real source of strength, and we are confident of reinforcing and extending our position through our continued investments. I will now hand over to Matt to talk about the U.S.

Matthew Mayer Maloney: Thank you, Jörg, and good morning, everyone. Grubhub has nearly doubled since we announced the deal, and we are still very excited about our opportunity in the U.S. In line with our strategy, Grubhub holds strong leadership positions in many key densely populated urban areas. And specifically, we are the clear #1 leader in New York City, which is one of the world's largest and most profitable delivery markets in the world. As a business, Grubhub is already at significant scale, generating $10 billion GTV on an annualized basis in the first half of 2021 with a year-on-year order growth rate of almost 30%. It's also fundamentally profitable from our marketplace business with an adjusted EBITDA of €63 million in the first half of 2021, excluding fee caps. Before COVID, New York City also had a very strong B2B offering that is barely registering now. But we are starting to rekindle as offices start to reopen, and that is obviously pandemic dependent. Looking forward, our strategy in the U.S. is in line with our global strategy to reinforce and expand our existing strongholds, drive network effects and enhance profitability overall. We will focus primarily on New York City, expanding and concentrating our platform there. The great City of New York does not appreciate the billions of dollars in food sales and millions of dollars in tips we've generated for them over the past 20 years, but we will still focus on helping restaurants there. We believe all fee caps on an advertising model are illegal, but we abided during the emergency orders in order to help restaurants there that were bearing the brunt of pandemic closures. Now that restaurants are open in New York City, we will vigorously fight any attempts to curtail a free market there. Once these fee caps have fallen away, we will continue to reinvest that amount back into the business and drive further growth for local restaurants. As part of our strategy, we also want to consolidate our marketing assets and transition Seamless to the Grubhub later in the year. Seamless is iconic in Manhattan but is less well known in the suburban New York areas. As the market gets more and more crowded, it is important to leverage a single brand across the city, and we will also get a local bump from a much more efficient national Grubhub television campaigns. We currently spend over $0.5 billion in growth in the U.S. and without fee caps, we would also have an additional $250 million in profits to spend here. We intend to invest significantly to gain back share and grow in our key leadership markets without tapping into global profits. We do not want to be a drag on our corporate EBITDA. We have a lot of plan for how we will win back in the U.S. and how we will -- we will show further strategic updates at our Capital Markets Day in October. In the meantime, I'll hand it over to Brent, who can take you through the H1 results for the group and our segments.

Brent Adriaan Wissink: Thank you, Matt, and good morning, everyone. In the first half of 2021, we achieved another step change in our skill, both from the combination with Grubhub and from the strong organic performance of the markets. On this slide, you see a comparison using IFRS and combined views for orders, revenue and adjusted EBITDA. The IFRS basis shows the Just Eat combination is from the control date of April 15, 2020, and Grubhub as from 15 June 2021. Please see the notes to the press release for the exact explanation. The combined figures show the data as if the merger between Takeaway.com and Just Eat as well as the acquisition of Grubhub took place from the 1st of January 2020. This makes the figures fully comparable and easier to assess the performance. Unless explicitly mentioned, all the figures in the financial section are combined figures. Please move to the next slide where we highlight the development of drivers behind the growth of the orders and revenue. As indicated before by Jitse, in Europe, we achieved significant improvement in our key consumer metrics, in particular, because of targeted investments, we generated an active consumer base of 98 million in the first half of 2021, which is an increase of 17 million active consumers compared to the same period last year. 67% of these 98 active -- 98 million active consumers are returning consumers, which means that these consumers are ordering minimally 2x in 12 months, this 67% is an increase of 3 percentage points compared to last year. Our consumer base is very sticky. One, they are returning consumer therefore, this improvement is expected to have a positive implication for future years' growth. As a result of the above and the improvement in order frequency, we saw a number -- we saw a further acceleration of order growth. The number of orders processed in the first half -- first 6 months in 2021 was 547 million, an increase of 51% compared to the years before -- to the year before. Strong order growth is seen in both marketplace and delivery. Delivery orders grew by 106%, which was driven by investments in restaurant supply expansion and successful partnership with big global QSRs as well as investments in reduced delivery fees following the price leadership strategy across major markets. Strong order performance fueled increases in both gross transaction value and revenue. Revenue growth of 52% at constant currency, outperforming growth transaction value even despite the significant impact of COVID commission rebates. In the first 6 months of 2021, we provided COVID commission support of €142 million, of which €110 million is related to government imposed commission caps in the United States and Canada and €32 million related to voluntary rebate programs to our restaurant partners. On Slide 28, we focus on half year adjusted EBITDA broken down by segments. We are pursuing a clear vision on how to win the market and strengthen our competitive advantage. In the first half of 2021, we focused our efforts to drive growth and online share -- market gain through target investments. These investments were predominantly made in the historically underinvested legacy Just Eat markets. As I said before, we believe that we had to catch up in these markets to maintain and regain market share. Overall, we estimate that €230 million were invested in Just Eat legacy markets in price leadership, additional marketing, continued rollout of delivery business and expansion of the restaurant base of which more than half went to the U.K. and Australia. In the first half of 2021, we've invested €122 million in product leadership by reducing delivery fees versus competition in most of our markets. We believe that these product leadership investments contributed significantly to the regain of market share and growth in the Just Eat legacy markets. Given the significant gap in delivery fees versus competition in most of our markets, who, by the way, has increased delivery fees further in the meantime, we have the opportunity to reduce the levels of price leadership investments going forward and still provide a competitive value proposition to our customers. To support our continued growth, our brand has to be top of mind across all markets. We are achieving this by increasing investments in brand awareness and performance marketing. Specifically, the EURO 2020 sponsorship was positioned has positioned our brand association as a top-tier sports sponsoring brand and has led the foundation for our further work with UEFA through 2025. Our operational expenses are growing to reflect investments we made in the expansion of the sales teams to drive higher restaurant acquisition, growth in logistics and consumer services teams to support our top line growth and an increase in tech and support functions to drive all the improvements to our platform and business efficiencies. We are continuing to generate strong adjusted EBITDA and healthy adjusted EBITDA margin as a percentage of GTV in Germany, Netherlands and Canada, despite the rapid expansion of delivery and the impact of COVID commission rebates. The significant investments, together with the fee caps and the voluntary commission rebates, led to the total group adjusted EBITDA of minus €190 million in the first half of 2021. Please follow me to Slide 29, where you noticed that we ended the first half of 2021 with a strong cash position of €1.5 billion, which includes the €1.1 billion we raised in February of this year through a convertible bond issue and some funds we acquired on the acquisition of Grubhub. With these funds, we are well capitalized to pursue our strategic investments. Now we will move on to focus on our segments. In U.K., the additional investment have successfully contributed to the strong order growth of 67%, with delivery orders growing by over 700% on a year-over-year basis. Revenue growth surpassed order and GTV growth despite significant investments we made in reduced pricing, which helped us to regain market share, including the triple-digit order growth in London. We have seen new consumers increase 28% year-over-year despite lapping exceptional new consumer acquisition from the first U.K. lockdown in 2020. In addition to the aggressive price leadership, we stepped up our investments in marketing and restaurant supply to catch up for previous years of underinvestments. We invested significantly in brand coverage, both nationally in the London with our global advertising campaign, local activations of new restaurants and successful sponsorship of EURO 2020. Our expanded sales teams signed up over 16,000 new restaurants as compared to June 2020, and we now have over 1,000 McDonald's restaurants on the platform. Altogether, these targeted measures led to a reduction of adjusted EBITDA, which sets a strong base for sustainable growth for the future, that have also being shown by Jörg when discussing the developments in the U.K. Moving on to Germany, where orders grew strongly at 62% to 80 million in the first half of 2021. GTV surpassed order growth by 50 percentage points, supported by higher order baskets and growth of delivery. Revenue growth was slightly below GTV at 76%, impacted by €11 million of temporary commission relief measures to support our restaurant partners. Adjusted EBITDA increased by 63%, demonstrating the strength of this business. In addition, we continued investing in Germany, as we've always done to further secure our leadership position. Next slide, please. In Canada, we continued our significant growth with both orders and GTV growing 54% year-over-year. Revenue grew by 38% on a constant currency basis. Revenue though has been impacted by €32 million due to temporarily, voluntary and involuntary commission relief measures to support our restaurant partners and which doubled compared to last year. At the end of 2020, the loyalty and reward program has -- was launched, driving high retention, increased frequency of our consumer base. Canada currently has the highest order frequency within our reportable segments. Despite the fact that these initiatives impacted our margin, we remain profitable in Canada, which is certainly caused by the quality of our logistical operations and the strengths of the [Indiscernible] brand. Moving to the Netherlands, where we've achieved a year-on-year growth of 37% with delivery share increasing by 3 percentage points to 10%. GTV grew well above order growth, driven by a larger basket values. Revenue growth surpassed GTV benefiting from a greater mix of delivery orders and promoted placement revenue growth. The growth of our delivery orders as well as an increase of investments in marketing and customer services had a negative impact on our adjusted EBITDA margin. Nonetheless, we are pleased to announce a €40 million profit in the first half of 2021, which is just a slight increase compared to the year before. Next slide, please. Here, we see the Rest of The World segment, which comprises of our 14 other European markets as well as Israel, Australia and New Zealand. We had a 54% order growth year-on-year, which grows -- in all countries, delivery orders grew 190%, 9-0 percent, which is mainly driven by our success in Australia. This growth in delivery orders meant revenue growth exceeded that of both growth in orders and GTV at 62% on a constant currency basis. This growth came despite being adversely impacted by over the €30 million of price leadership strategy, particularly in Australia as well as the impact of temporary commission relief to support our restaurant partners across Europe and Israel. The rest of the world produced an adjusted EBITDA of minus €136 million in 2021 compared to €7 million plus profit in the same period of last year. This investment mainly focused on the previously underinvested legacy Just Eat businesses. The investment in the rest of the world was in 3 key areas. Firstly, the temporary period of price leadership, particularly in Australia; secondly, expanding delivery coverage, including the rollout of the employment model in France and Italy; and finally, significant investments in marketing, in particular our sponsorship of EURO 2020, leveraging our consistent branding across all of your -- all over Europe. We will continue this investment strategy in the rest of the world across the remainder of the year to further fuel the growth going forward. Moving to the U.S. In the United States, Grubhub processed 134 million orders in the first half of 2021, representing a growth rate of 27%. Orders grew across tiers and throughout the country. And during the first half of 2021, Grubhub began to see post-COVID-19 recovery in large city downtown areas, including markets like Manhattan as well as in corporate businesses. GTV increased 31% on a constant currency basis, outperforming order growth. This was primarily driven by a harder average transaction value during COVID-19 lockdowns. Revenue grew 33% on a constant currency basis to over €900 million in the first 6 months of 2021. Revenue growth reflected the mix shift to delivery orders offset by an approximately €70 million year-on-year headwind from fee caps and voluntary partner support initiatives. The lower adjusted EBITDA and the year-on-year comparison is predominantly driven by the impact of the temporary commission fees -- fee caps. Removal of fee caps will positively impact future profitability and will provide room for additional investments to strengthen the market position. As you might know, some big cities has announced to extend their relief measures, but we are planning to oppose it as we believe that these measures are unlawful. Next slide, please. Finally, we provide you some insights in iFood's performance, our Latin American joint venture, in which we hold 33% stake. The results presented here are on a 100% ownership and constant currency basis. As Jitse discussed before, iFood is a strong business, and we can see that in other impressive set of KPIs and financials. Orders increased by just under 70% with GMV and revenue increasing ahead of order growth, driven by the impact of increased delivery and grocery share. At the same time, EBITDA losses decreased in absolute terms and EBITDA losses as a percentage of GMV decreased by over half to approximately 1.5%. Given the strong performance of iFood and the high potential, we expect to continue taking up our rights to participate in future iFood capital raises as they fund their ongoing investments, the latest being approximately €50 million in July to fund iFood's current financial year. With this, I conclude my part and hand over to Jitse.

Jitse Groen: Thank you, Brent. On Slide 39, we'd like to reiterate our guidance in terms of order growth, GTV and adjusted EBITDA as a percentage of GTV for 2021. We guide for an order growth for the full year of 2021 of at least 45%, excluding Grubhub. For the full year of 2021, GTV for the combination is expected to be in the range of €28 million to €30 billion, which clearly establishes us as one of the largest online food delivery companies in the world. 2021 is an investment year to expand our market leadership, in particular, in the legacy Just Eat markets. However, we believe that adjusted EBITDA losses peaked in the first half of 2021, and we expect our adjusted EBITDA to improve going forward, driven by a few factors

Operator: [Operator Instructions] And the first question is coming from Ms. Estia Ryan, Barclays.

Andrew Geoffrey Ross: You've got Andrew Ross on from Barclays. Can you hear me, okay?

Operator: Yes.

Andrew Geoffrey Ross: Sorry about that. I've got 2 kind of going. First one is on the fee caps and what you're including in your guidance in the second half. Clearly, since you provided the '21 guidance in the mid of July, there has been some news in New York. So could you just clarify what is in the guidance regarding fee caps in the second half and kind of an overview of key cities would be great? And then the second question is on grocery and about the dark store you're opening in Canada. Can you just give us a bit more color as to where the plans are going regarding dark stores in Canada? You said that you think we should get to a similar underlying profitability of your core delivery business. So should we interpret that's going to be a big rollout on that basis or not? Any color around that would be very helpful.

Jitse Groen: Thank you. Regarding the question about fee caps, there was, of course, the announcement by New York that fee caps are going to be extended. We decided to be rational about this and swallow those fee caps in the guidance, and that effectively then means that we will move certain resources from other parts of the U.S. to the cities in which Grubhub is strong and therefore not use the additional investments that we were expecting to get from the roll off of those fee caps. Now when those fee caps are going to roll off, we will use the additional investments from the fee caps going away to invest in the major cities of Grubhub. And again, these investments will be very much like the investment that we have made across our European businesses. They will be in sales. They will be in marketing. There will be in delivery. There will be in the quality of our business essentially. And it's easier for us just like it is in Europe to increase the efficiency of our business in place in which we are already large. You can see that example in the U.K. I think the U.K. grew from 11 million orders to 25 million orders a month in the course of a year, which is, of course, very significant, but it's a lot easier to grow a very big business into a much bigger business than what it would be to grow a tiny business into a large business. So we are always very much concentrated about these investments. But again, we are a rational player. We're not going to spend money that we simply do not have. So it's very simple. In terms of the question around grocery, we have now opened 2 test stores in Canada. Those tests are going actually quite well, quite excited about it. Should we be happy about the unique economics and also about the stability of that business, we're going to roll out that model throughout Canada. But of course, these are tests, and we have to await the test results for it. But at this point in time, we're quite enthusiastic about how these hubs function. And again, we already have a profitable underlying delivery network. So there's -- it's quite easy to add something on top of that. And in Europe, that's much harder, of course, because economics are more challenging. And therefore, the investments that you would have to put into the rollout of dark stores in Europe is going to be significantly greater than what you would see in Canada. And this is also why we have chosen to partner with supermarkets in Europe to achieve the same outcome.

Operator: And the next question is coming from Joe Barnet-Lamb, Credit Suisse.

Joe Barnet-Lamb: Three for me. The first couple are on the profit bridge, just to better understand it. You mentioned €81 million impact from the August price increases. And in the U.K., that's €31 million. Can you confirm, is that the impact solely of the admin fee change? Or does it include a rise in delivery fees too, which seem to be starting to take place according to third-party data providers. Any color you can give on that would be great. Secondarily, and building on Andrew's question relating to fee cap. Can you break the €110 million fee cap, involuntary commission cap, impact down between New York and the rest of North America? And then finally, just on the step-up in Rest of World. Brent spoke a bit about this. But can you talk more about what you're doing in that segment? Brent said that, that investment would continue through the balance of the year. As such, can we assume that Rest of the World adjusted EBITDA losses will also peak at some stage in this year? Or could it step up further in '22?

Jitse Groen: Okay. Thanks. I will take the last 2 questions. I will refer the first question to Jörg. Regarding the Rest of The World, you can assume that, that has also peaked in the first half, because a lot of the things that we're doing in Rest of The World are the same as what we're doing in, for instance, the U.K. Now the Rest of The World is a little bit of a mixed bag. We have profitable countries in there, large countries that are growing pretty nicely, think of Poland. But we also have a very significant investment program, for instance, in Australia. And that program actually reestablished us as the market leader in Australia, so it's very successful. It's our fastest-growing country as well. But yes, those investments cost money, but we've -- we're also there to peak of those investments. And you'll also see us improve the unit economics in Australia. So that's very much in line with the rest of the legacy Just Eat businesses. Then regarding fee caps, I can't give you an exact split, but obviously, a lot of the business of Grubhub is in New York, so you can also assume that that's quite a significant part of the fee caps. And it's unfortunate that these fee caps have been extended, but it is what it is, and we're going to have to swallow that difference. Regarding the U.K., I think Jörg?

Jorg Gerbig: Regarding the price increases, it's a mix of the -- what you said, admin fee change and price increases on delivery fees. So for example, you have seen probably that in London delivery fee went to 99p, which was previously 0 for most of the QSRs. So it's a mix of both.

Operator: And the next question is coming from Rob Joyce, Goldman Sachs.

Rob Joyce: So yes, sorry to build on a familiar theme, but it does seem most investors most concerned and you can maintain current momentum and also see those EBITDA losses improve. So I guess just in that vein, in the U.S., just firstly, should we -- in the second half, should we be expecting losses to broadly stay at the same rate of the first half and the second half? And just building on Matt's comment about EBITDA not negatively impacting the group level. [Indiscernible] Grubhub broadly EBITDA breakeven? Second one just on that. In terms of peak investments, can you just give us a bit of an idea how we should get comfortable outside of the U.S.? Is that mainly through delivery fee increases or underlying improvement in economics? And then a final one, just in terms of the portfolio, I think you mentioned you'll talk more about this at the Investor Day in October. But I mean, would you consider monetizing assets outside of iFood, not just the iFood stake? And if €2.3 billion isn't the right number for iFood, can you give us an idea of how you think about what is the right number?

Jitse Groen: Thanks, Rob. So let's first address this question around iFood. I can't give you an exact amount because also you've seen a growth in that business. Actually, the longer this takes, the more value that business has. So you would have to ask me at the moment that we can actually announce a sale of that stake and why we then did it. I think that's very dependent on the moment in which we actually sell that asset. And as we said, the value is very significant, and we believe that we're going to get a very good price for that. We are always looking at our portfolio. I think that has always been the case. As you will remember, we divested Mexico last year. We have divested our Vietnamese business. We even divested the U.K. and France when we -- we've always talked about network effects and how difficult it is to beat a successful incumbent. We've left the U.K. because we could not compete with Just Eat back in the day. And similarly in France, we were chanceless because we were just too small. So we have done this in the past. We are very much about owning very profitable market-leading positions. We know that sometimes our competitors say, "oh, it doesn't matter when we are at this #2 or 3." It does matter. We don't know any #2 or 3 that is even remotely close to profitability. It does matter. And we don't think that the only way to be profitable to #2 and 3 is to decrease your marketing efforts. And therefore, the #1 is just going to increase its gap with you as a #2 or 3 player. So we don't like those positions, and we are very much after these very strong positions, these profitable businesses. And there are not that many of those businesses, but we happen to own a lot of them. So if it fits that profile, we're not likely to be a seller. If we can see that to get to profitability it's going to take ages, we will divest that asset. In the case of iFood very specifically, if we would own the whole business, we would certainly not divest the business, but we own a stake and therefore, we can't control it, and we need to sell it, because we don't see why we should own stakes in competitors. It doesn't make any sense, because everybody can own stakes, but we're not a financial investor, so it doesn't make sense to us. Then regarding the momentum. A lot of what we have done, and you can see that on the cohort slide has significantly increased order frequencies and our customer base and the restaurant counts. Those things are there to stay. If there's no more pandemic, that doesn't matter. We essentially added a lot more customers than we would have been able to do outside of the pandemic. And we made use of that pandemic to actually -- mostly on the Just Eat side to improve that business significantly. So I just mentioned it. It's a big difference if you have 11 million orders in the U.K. or 25 million. I mean all the network effects are much greater. You're able to attract all the QSRs. We've become the largest McDonald's partner in the U.K., for instance, that's very significant as well. So there's all these benefits that you have when you're bigger. And these benefits, they will materialize because it's a cohort, we can predict cohort behavior. It's not that difficult. So we are quite confident about the momentum. And if you look at our pricing, even with the July, August increases, we're much cheaper than everybody else, right? So we have a lot of upside there as well. But we're going to be very patient with the increases, because we see that our strategy is working. We plan to overtake the #1 in London. We have very good momentum in the London market. So that's the next aim for us in the U.K., and we plan to put quite a big gap between us and the number -- then the #2 in the British capital. So that's the current plan. We're after that. You should not expect us to all of a sudden raise the delivery fees to not be competitive anymore in the market. So that's the trade-off that we make. Regarding the EBITDA loss in the U.S., I think it's safe for you to assume same rate in the second half. That having said, a lot of that is dependent on the fee caps falling away or not and in which area. So we have to monitor that. As we said, we -- and also, as Matt said, we plan to run it roughly at breakeven. But yes, the fee caps are a question mark to us. So we have to look at what will happen and when it will happen. In some cases, the fee caps have fallen away. In other cases, we are expecting them to fall away within a month or so, so we have to look at that. I think those were the questions, if I'm correct.

Rob Joyce: Just the -- sorry, yes, it's very helpful, but the EBITDA beyond that, I think you mentioned not been a negative drag at a group level. Is that a comment that you might run at breakeven for the longer term?

Jitse Groen: It is, yes. I think it's very -- I think it's important, actually, around the Grubhub. Grubhub has a very profitable forum. It owns a large marketplace segment. It owns a large B2B segment. And of course, a lot of the B2B has been impacted because of COVID. But yes, when people return to the office, that's going to come back because there's all these corporate contracts that are contracts, right? So people are obliged to keep on ordering Grubhub. So this -- we have good visibility on the profitability of that business. But yes, we are in a little bit of a strange situation, of course, with the pandemic, hopefully, behind us now, but we'll have to see.

Operator: And the next question is coming from Silvia Cuneo, Deutsche Bank.

Silvia Cuneo: My first question is about digital, just building out on your comments to one of the last answers earlier. Can you please talk about where you stand on business like where do you see the delivery sort of orders going from the current 39%? And how do you see the competitive landscape playing out in major areas like London? You talked about aiming to become the #1 there. But I think the market share can grow by another 10 percentage points next year, for example. And then my second question is about the U.S. As you confirmed, the adjusted EBITDA loss has peaked. Is that fair to assume the U.S. does not need a major step-up in investments like it has been the case for the Just Eat legacy market? And if that's the case, to what extent it's that due to the different riders model. It would be great if you could also talk about whether you are considering transitioning to an employment model there at all?

Jitse Groen: Thank you. So let me first answer that question around the U.S. The U.S. requires further investment in the strongholds, and there's 2 ways that we can go about that. We can move resources from the rest of the U.S. to those strongholds and we can use the fee caps falling away. Now if the fee caps fall away slowly, we'll use more of the assets outside of those cities. If the fee caps move away quickly, we use the fee cap money. That's how we look at it. It's a lot of money, right? It's actually quite a big additional investment. And I think it's also something that people often don't see with us. We spent -- the combined business has almost €0.5 billion of marketing in half year. So that's -- if you look at run rate for that, it's about €1 billion of marketing that we spent. And Matt was also referring to it. We actually have quite some investments already going for us. And we do believe, let's say, the legacy JET management that, that investment needs to be targeted at the major cities. Now it would be easiest to use the fee caps for that. But we are where we are. So we have to await that and therefore, we will likely move resources to get the same thing done. But around neutral EBITDA, I think that's a sensible way forward after this year. We won't change the employment model, unless, of course, the government requires that from us and then everybody has to change the employment model. Regarding your question around London, look, we plan to be the absolute largest food delivery website in the whole of the U.K., including London and whether 10% absolute gain is enough or 20% or 30%, that's difficult to say. We just know that the #1 will make money and the #2 and 3 will likely not make money. And that's a more important thing to remember, I think about our business. Same thing in Germany, right? There's a lot of players that want to become the #2. Well, that's going to cost a lot of money to be a serious #2 against such a formidable company like Lieferando, and it's not likely to become profitable ever. So I think these are the most important things in our business, just show us a highly profitable #2. They don't exist. Then regarding the delivery share, well, delivery in the first half is growing more than 700%. So clearly, that's still going to become a larger segment. Our aim is to decrease the losses on those delivery orders and turn those loss into a gross profit benefit. And of course, we still have the very profitable marketplace business, so we don't necessarily need to be gross profit positive, but we are a rational company, and we believe that the costs need to be covered, right? So this is the way we look at it also. So yes, delivery will grow. If we add grocery chains, also buy a lot, but we feel that, that business also needs to be profitable. And therefore, we'll do everything that we can to get there. And we have given specific guidance also for it.

Operator: And the next question is coming from Marc Hesselink, ING.

Marc Hesselink: Actually, my main question is about the price increases and how you think about that going forward for the delivery. Is that something that you approach on a country by country basis or city by city or maybe even restaurant by restaurant like really looking at what it adds to your network effects? How many new clients does it bring in? How much gross profit is that per order? I think I really like to know how you think about that and also going forward.

Jitse Groen: Yes. Indeed, we look at it on a very granular basis, especially from a competitive point of view. No, there should be no reason for a consumer to go to another platform than us. So we should always provide the best price value proposition to the consumer. That's one of our key strategic pillars, and we want to make sure that this is the case. So we're looking at it indeed like very granular with regards to competition. But even on a city level because also like providing some of the smaller cities might have less density than some of the larger cities, so that might impact pricing, but also whether it's QSRs or non-QSR businesses. So we definitely have a various range of factors, which are being included in that decision.

Marc Hesselink: So that's something that you can optimize like every -- I don't know every month, every quarter, you look at, okay, is this still the optimal level and you can change that a bit?

Jitse Groen: Well, actually, that's the way we currently do it. We want to move to something that basically changes every minute. So we're actually investing some money into those sort of projects. And again, for us, there are several drivers. It might be that for certain QSRs, we have a different rate. It might be that in certain suburbs, we have a different rate and we look very carefully at the competition, of course. But the most important thing to look at is the customer, what's the customer willing to pay? And are we the most affordable option? Because we believe that it's often overlooked also in our business, but the marketplace business has a much lower price point than the delivery business. So I'm not talking about delivery fees, because that's where the focus is on a lot. I'm talking about just the price of the foods. Market-based restaurants are much cheaper than delivery restaurants, because they don't need waiters and that sort of thing. So actually, for the consumer, we are in mostly -- we're basically in all the markets, the most affordable choice, right? So we also would like to be the most affordable in delivery. And we think that we can outlast any competition because we have that marketplace business. So in that sense, we look at this, let's say, in a very scientific manner.

Marc Hesselink: And then as a follow up to that, how do you then think about the QSRs? Because if I'm correct, they still pay a slightly lower commission rates typically than like another restaurant. And also the basket prices are smaller. So they cost you more. Is that something that you would like to repair? Or you just accept that because they bring in so many new extra clients?

Jitse Groen: Look, you're talking to a bunch of entrepreneurs, right? So you are very much focused on the current situation. We are thinking about how does the company look like in 3 years? How does the competitive landscape look like in 3 years? How do AOVs develop, et cetera, et cetera? So we are looking far more long term, and we're looking at what can we expect that the consumer is going to do in a couple of years from now. So having worst terms on QSRs, while they bring us more new customers and a better product, a better proposition while we also know that commissions can increase in the future that actually the amount of orders will increase, the density of the network will increase, all these things that will improve over the next couple of years, you need to take into consideration when asking such a question. So yes, QSRs have better terms, but also take marketplace. Domino's has better terms than a mom-and-pop shop, because there's more volume. Still, we're very happy that we have Domino's. You could say, yes, because you're making less money on the Domino's. But yes, that's true. But we're getting a far more volume, far more new customers. It's much better for our brand image. So we have all these benefits. And again, this is a moment in history. And in the end, it's about who runs the largest profitable business in the country. And if you don't run that business, you are in a little bit of a difficult spot.

Operator: And the next question is from Clement Genelot, Bryan Garnier.

Clement Genelot: I've got 2 questions on my side, if I may. The first one is on price increases. So if I might price increases shows would bring €80 million in H2, of which €40 million in the U.K.? So where did you also increase prices on July and August beyond U.K.? And why did you increase the prices just to follow our competitors and thus, so we align with them? Or whether because you feel that the customers become key enough to may have accept a price increase? And my other question is on delivery. So you mentioned improved unit economics in delivery from 2021. Do you have any more color to provide to us at that front? For instance, how much is the current number of drops a rider per hour?

Jitse Groen: Thank you. So let me address your first question. We constantly evaluate our pricing. So we go up with prices, but we also sometimes go down. If we see that we are getting a new competitor that is trying to on the -- cut us, we go down. So we don't always go up. So the -- you see a result there, which is a positive result of all the things that we do essentially globally in that business. I think it's important to understand that -- take a country like Germany. Our average delivery fee is €1, right? I mean our competitors in the U.S., they charge $5.50 or something. We are at €1. So we are very low, and we have possibilities to change pricing per part of the city, per restaurant chain, per part of the country, et cetera, et cetera. So we can go either direction. So if you ask us where was this, it was everywhere. And it might be that in the north of a country we lowered the pricing, and in the south we increased it. So that's a difficult question to answer in that sense. Then regarding what we can improve in delivery, a whole lot because first of all, take the U.K., that's the clearest example. In the U.K., we currently operate 3 models. We currently grow 700%. Now obviously, take the city of London, we've rolled out the employment model to parts of London. Now that means it's not efficient, because you would have difficulties getting a courier to go to an area in which you run another model. So your efficiency is actually lower than what it could be. Now if you run the same model in the whole city of London, you're going to be far more efficient than what we are now. So there's a lot of efficiency gains there. Also with 700% growth, you need -- you have a lot of waste. You have a lot of things that you need to improve. You don't have the density, yet, that you want to get. I was just referring to that market share in London. Obviously, because we have slightly less market share now than the #1 and 2 in London, our density should be lower than these guys. If we have a higher market share than these guys, our density should be better. And in the end, if we look at just the KPIs, identity in countries like Germany and Holland is much greater than what we have in London at this point in time. So we have a lot of improvements that we can make. We can't disclose drop rates. We just know that they're really good compared to everybody else. I just mentioned Canada, for instance. Canada is a very profitable logistical business that we own. And actually, the drop rate in a country like Germany is better. Of course, the economics are worse because the labor cost is higher in Germany, but the drop rate is actually better in Germany. So it depends very much on the country, but we can improve everywhere, also because we have different systems, right? We have, in total, a couple of models in the company trying to leverage the tech, the knowledge, et cetera. So we have a lot of things that we can improve. I mean, I could give you a very large list.

Jorg Gerbig: Maybe one thing, because I think you're comparing the wrong figures. You mentioned the €31 million, which is depicted on the Slide 11, but you have to compare that €31 million with the -- sorry, €81 million with the €31 million on Page 17, and you were comparing here the wrong figure. So it is €81 million versus €31 million. That's the right comparison and not the numbers that you mentioned.

Operator: And the next question is coming from Sreedhar Mahamkali, UBS.

Sreedhar Mahamkali: Three quick questions for me then, please. So firstly on Germany. I appreciate your newly entered competitors haven't had much of an impact. But as you take a sort of 2, 3-year view, do you feel the profitability in Germany can remain as healthy as it is currently? And also, are there any elements of your own plans in Germany that might need to be tweaked in response to competition such as rollout -- pace of rollout of logistics or groceries? That's the first from Germany. And secondly, in terms of U.K. restaurant supply, I think it's going to 58,000 of vendors the first half, which is looking, like, at our data it puts you as #2. But I think, Jörg, you mentioned you're now #1 on a like-for-like basis, if you can clarify that. But more importantly, I guess, again, on our data, it seems like the last couple of months or so, restaurant recruiting is stalling a little bit. You can talk about your strategy that leads to be helpful in terms of how you drive choice from here and become a leader. And last one is just a clarification. I think you talked about running U.S. for breakeven. Is that a comment for 2022? Or is there anything else you can highlight sort of slightly beyond '22? Is that more of a medium-term sort of plan is how we should interpret? Those are the 3.

Jitse Groen: Yes, so the last question, that is for 2022 because obviously, still we have the fee caps now. We expect them now to roll off in February next year for New York, right? So that's the '22 is the accurate year to look at for the breakeven comment that Matt made. Then regarding your question for Germany. While you should expect the EBITDA in Germany to go up, I think you were suggesting whether we could maintain the profitability? It should go up. Regarding competitors, Jörg made a good comparison here, right? Our GTV in Germany is €2 billion. We have 1 competitor that is now reentering Germany that has €1.4 billion in GTV in the whole of Europe. So you can't seriously expect that, that company is going to achieve a #1 position. So they must be after a #2 position. And again, if you're after a #2 position, the chances that you're going to make money in Germany are very, very slim. Germany is not the easiest country to compete, because there's quite a lot of legislation in Germany. And I just now put it mouthly, I'm from another country with a lot of legislation, but I still think there's a lot of legislation in Germany. So it's going to be very difficult to become a serious #2 in Germany, and you're going to have to invest hundreds of millions. Like was already demonstrated years ago, right, this has already been attempted, and we've had 40 competitors in Germany, and they all failed. And our market leadership in Germany is not an accident. We've competed with a lot of people over there. So yes, are we tweaking? Well, we are looking at what competitors are doing. If they do something smart, we'll certainly look at it. If they do something stupid. You see a lot of couponing, again, right, a lot of free foods being handed away. I can just give you the example for Jörg, because Jörg lives in Berlin and then drives these things. So Jörg first gets a €20 coupon, then he orders grocery, then he gets 2 free chocolate bars. And remember, you didn't pay for the grocery, right? And then he gets -- 2 days later, he gets 2 vouchers of €5. Now I don't want to make that calculation on the return of investment, but that doesn't sound like a great plan forward. So if that's what the competition is going to do by all means, they should do it. Regarding the restaurant count for the U.K., Jorg?

Jorg Gerbig: Yes, I can -- no, the 58,000, so first of all, like I said, it's not like-for-like. So if I look at our 58,000, almost 100%, so 97% of that is really active in the sense of like having received an order over the last 13 weeks. And we're also obviously checking on competitors' websites. And at our competitor website, this number is much smaller. So when you compare that, for example, with one of the competitors you mentioned, that number was only 80%. So that actually would leads to a number, which is more like 47,000. So there's quite some gap there. And then also like if you look at the estate actually, there's quite some multiple lines, which are accounted as multiple entries. So the extreme example is a restaurant in Croydon, Indian restaurant, where we have one entree and competitor has 23 entrees. I could even give you the name here. And then there's multiple examples of that. So just purely taking that listed count doesn't really work so well. And also like -- I mean, I think the number was not clearly stated, the absolute number, but it was that the competitor added 10,000 restaurants, which was almost 30% increase, which would guide me to a number of -- they went from 30,000 to roughly 40,000 of restaurants. So if that was the right wording in what they said in the press release, that number is clearly significantly lower than what we have in the U.K. And last but not least, even then if the estate would be at a similar level, what it also clearly shows is our restaurants actually per restaurant partner get a way higher order per restaurant, which is also an interesting metric. Even if there would be just about 20% below our active restaurant estate, we are almost doing double the amount of orders. So the order account per restaurant in our case is much, much stronger, which implies that actually our network effects are much, much stronger, that's first. And secondly, probably, the estate, which is being added is not necessarily the one the consumer wants or is providing a lot of orders.

Sreedhar Mahamkali: Got it. Two quick follow ups. In Germany, are there any chain restaurants that are actually exclusive to you? And in the U.K., maybe you can talk about how you'll drive the restaurant choice from here? What are the steps you're taking? I think you talked about local heroes starting to come on the platform the year after you started logistics, et cetera.

Jorg Gerbig: We don't do exclusivity contracts in Germany. That's something generally we don't want to restrain the market, and we believe, in the long run, given the network effects and the market position we have, we'll anyways have most of the supply side as well. Maybe on Germany, also adding because you were asking a bit of an outlook. And obviously, Berlin is probably the market where competition has been around for the longest. Some of the competitors have been around for more than -- yes, more than a year or approximately a year by now. And if you look at YipitData, which is credit card data for Berlin, we are still at a 90% share, and the competitors are at 4% and 6% and then basically not existent. So -- and directionally, their share is more or less flat over the last couple of months. So like you see like even in a city where competition has been around for longer, the share gains are not really significant. But obviously, if you come from 0, you will always have some share gains. With regards to deals in the U.K., most of the deals with chains are also not necessarily exclusive in the U.K. Like I said, we're not necessarily aiming for exclusivity deals generally.

Operator: And the next question is coming from Wim Gille, ABN Amro, ODDO.

Wim Gille: I would like to go to Slide 10 first. You are currently investing a very significant amount of money into delivery to successfully acquire new clients. Can you give us a bit of an indication what the profile is of the customers that join the platform through the delivery channel? Is the profile and the order behavior similar to existing clients? Or do they exhibit a different behavior? And maybe taking the U.K. as an example, you have a delivery share of about 40%. So that means that U.K. consumer currently orders around 4 delivery orders and roughly 6 marketplace orders. Is this profile per annum? Is this profile the same for all the cohorts in the U.K.? And more specifically, what is the split between delivery and marketplace orders for the 2021 cohort that you recently signed up? And in extension of that question, if we take the marketing cost plus the losses in delivery as customer acquisition costs, what is the payback period that you expect for the 2021 cohort? And how does this payback period compared to previous cohorts? That will be my first question. And then I have a follow up.

Jitse Groen: Thank you. I will have Brent answer that second question. With just your remark about the cohort, first of all, our consumers rarely know whether we are delivering the food to somebody else before they order. So we have no delivery customers or marketplace customers. I think this is a misconception from the markets, and I have to admit that we must do a better job in explaining that. But we do not have delivery cohorts. We don't have such a customer. We just have customers, and you can also see this in the order frequency behavior because that applies to the whole customer base. And of course, even if we had a record year in new user addition, most of our customers are actually existing customers. So they influence the order frequency most. And I think what you really understand about what we did in the U.K. is that Just Eat was very late with the logistical rollout. So that also meant that Just Eat lost quite a few customers to other players over the course of the last couple of years in which, for instance, they did not have McDonald's or they did not have the local seller or they did not have a specific Sushi plays that people were interested in. So we did 2 things. So first of all, we repaired that. And then second of all, we said, okay, dear customer, please come back to Just Eat, because we now have the offering. And by the way, it's much cheaper than that with the competition. So you have good grounds to come back and then place a logistical order with us but also the market-based orders. So we have reduced churn significantly, but we also -- and you see that in the cohorts, we have reactivated these order cohorts. Those people might have left Just Eat and they're back now. And they're back not only for the delivery orders, but also for the marketplace orders. So as we said, we're rather agnostic about it. I mean we need to give the customer what the customer wants. And if the customer wants to order with a salad bar that we have to do delivery for, we do it. And as said, our marketplace business keeps on growing. That's highly profitable and the delivery business is profitable in the U.S. and Canada. And we need to increase the profits also in Europe. And because the unit economics are more challenging because of the labor cost and lower ticket sizes, the scale needs to be bigger than what would be necessary, let's say, in Canada or the U.S., to get to profitability. But this is the way we look at it. So we look at it very much from a customer perspective. And the customer, again, I mean, you can't see it on our website, whether we deliver or the restaurant does. So that distinction doesn't exist for the customer.

Brent Adriaan Wissink: Yes. And with respect to the second question about the return on investment on a customer, how we look at it, and we look at it per market is that we divide the marketing. We do the marketing cost divided by the new customers, and that is the customer acquisition cost. And then we compare that with the gross profit per customer over its lifetime. And as you can see from our cohort, the lifetime of a customer can easily be 8 years. And actually, all the countries where we are active, the customer, the return on an individual customer is positive. The only big difference is, of course, that in Holland and Germany, for example, the gross profit per customer is significantly better. And then, the return on investment of individual -- on an individual customer is significantly higher. So you recoup your acquisition cost within, let's say, 1.5 years, whereas in countries where gross profit per order is lower either because more competition, we charge a less delivery fee right now. It will take a little bit longer before we can recoup our acquisition costs. But actually, in all the countries we are active, the return on investment is positive and would certainly meet the threshold of an average investor.

Wim Gille: Very good. And then I have a follow-up question, and I would like to move to Slide 11 where you provide an excellent bridge on the profitability. If you look at that, you see that the fee caps took out about €110 million in profits for the first half. How much of these caps have already lapsed and are no longer applicable in the second half? And also, if I then look at the base for the second half, if I take out the voluntary rebates and the price increases that you passed through in August, the base already moved to a loss of about €70 million. Then taking a normalized view on fee caps in the second half, you get probably close to breakeven. Still on the low end of your guidance, you expect to make another €100 million loss or more in the second half. And can you give us a bit of a feeling where do you intend to invest these additional investments, which will come over on top of what you already invested in the first half. So which regions and which channels should we think about?

Jitse Groen: Yes. So let me take the fee cap question, and I'll refer the second one to Jörg. The fee caps, a smaller part of that is already gone. And unfortunately, because a lot of this is actually in New York, a large chunk is still in New York, and therefore, it's only a smaller part at this point in time. And we do have some expectancies that a couple of the other cities are known to retract fee caps. But at this point, it's a smaller part of that €110 million. Second question, Jörg?

Jorg Gerbig: Yes. So with regards to profitability in H2, I mean, we have given guidance previously that actually included an assumption that the fee caps in the -- especially also in New York, would fall away. We've now clarified that despite the fee caps not falling away, we still stick to guidance. So you will see us not massively improving in the second half as compared to the first half. And we also will invest additional amount of money in specifically also like rollout of logistics, for example, in the U.K., we are still rolling out more cities and more areas within the cities. I mean, in London, we've already rolled out quite a bit, but we've not yet covered the whole of the city and usually, especially the beginnings of the rollout to actually have lower efficiency levels. So especially the beginning, let's say, 6 to 12 months of these rollouts cost quite a lot of money. We're also hoping for additional -- additions of maybe some QSRs across our various countries. There is in certain country still some QSRs which we wanted to add like we've explained previously, these unit economics are a bit different. And then there's also some investments into our headquarters, especially also like IT staff and a few other things which contribute to that. So that would be the main focus on our investments.

Wim Gille: And just to clarify, did you mention that it takes about 12 months for a new Scoober have to reach normal efficiency?

Jorg Gerbig: It's a bit dependent on the city. I mean, you cannot generalize it. But like -- so if you add a hub in a city where you're already active and you're just replacing, that can go a bit faster because you already have the scale and density. So it depends very much on the partners you're adding and how fast you actually get to a certain scale and density in the city.

Wim Gille: But 12 months would still be kind of a good indicative time frame for modeling purposes?

Jorg Gerbig: Yes.

Operator: And the next question is coming from Andrew Porteous, HSBC.

Andrew Porteous: A couple from me, if I may. Just wondering, coming back to your guidance again, is there anything in there for your sort of plans with grocery partnerships coming through? I mean, is that accounted for? Or would that be incremental to the guidance you put out there? Secondly, you're increasing prices, what seems like quite early in the new strategy. I'm just wondering what's sort of giving you the confidence to do that? Is it more driven by what you're seeing in the market around sort of competition raising prices? Or is it more driven by sort of the behavior of customers that you're seeing? And effectively, you're sort of winning back those customers already, so you're a bit more confident there. And then the last one for me was, obviously, a lot of the gains that you've had to date sort of come from sort of high-volume QSRs. I'm just wondering if there's any plans to sort of push into more premium areas a bit more aggressively in the future or whether that's sort of an area that's perhaps a little bit smaller to follow with?

Jitse Groen: Yes. So that last question. I think these questions are good. So especially in London, we are also very busy on getting those more exclusive restaurants online. That, however, is a smaller segment of the U.K. market. I think it's very important to understand that that's, of course, if you live in London, you think that that's the entire business, but it's actually quite a small segment. And therefore, also, let's say, we would be able to add all these restaurants. It's not going to make a material impact to the amount of orders. Even with our competitors, the logistical guys, trust me, most of that business is QSRs. It's not -- it's actually not these local heroes, although, of course, that's the image that these guys sometimes portray, it's mostly the QSRs. So for us, the most important thing to fix was actually the QSRs in the U.K., not so much these local heroes. But we do realize that for London, we need them, and this is also why we signed up so many in the last year. The pricing depends on a lot of factors. Obviously, if we are still working on getting a lot of customers to go from one of our competitors back to Just Eat, then, yes, pricing is very important. If the customers are back -- because in essence, why did the customers leave? Because we did not have certain QSRs mostly or certain restaurants. So if you fix your supply bits and you have the customers back, you don't per se need a cheaper delivery fee, right? And this is also why if you look at markets, and this is also what Jorg just mentioned, if we don't have a certain supply in one of these other legacy Just Eat markets, we still have to do that and we still have to lower the delivery fee to get those customers to come back. And of course, this is a double-edged sword, because on the one hand, we gain a lot of customers. On the other hand, our competition loses a lot of customers. So I think that's always -- that's a good situation for us if that happens. So in the U.K., it's actually easier for us to raise prices than elsewhere. Similarly, of course, in countries in which were strong like Germany and Holland. But in the end, yes, we look at the utilization of the network. So we also don't want to increase prices to a level that the orders go down, right? So we also want to keep up the growth. So the growth is more important to us in relation to the pricing than anything else. Once we keep up the growth, we see that these delivery vessels get us a lot -- quite a lot of new customers. So this is why actually the trade-off is between growth and pricing and not per se between competitors and pricing. Grocery is included in the guidance. So it's important to understand that we roll out grocery in Europe on the back of the delivery network and the delivery network needs to improve the unit economics. So grocery is included. Obviously, in a country like Canada, if you add something that's already profitable, that's always fine, of course, even if you have to build hubs. That's always a good situation. So yes, the grocery is included in the guidance.

Jorg Gerbig: Excuse me, operator. Are there more questions? Excuse me, operator? Are we still on?

Operator: I can hear you now. Please continue, Ms. Adisa.

Miriam Anuoluwapo Adisa: Okay. Great. Firstly, just on Germany. Could you just talk a bit about the initial learnings that you're seeing with grocery? And are you acquiring a lot of new customers? Or are the orders coming from your existing customer base? And then secondly, on Rest of The World, specifically Australia, could you just give a bit of color on the unit economics in Australia, given that's clearly the sort of key driver of the losses in that segment? Perhaps sort of where that the share of delivery is now? And then also what's the latest on the Scoober rollout as well? And are you expecting to move to a fully employed model in Australia? And to what extent could that put more pressure on EBITDA there? And then finally, just on current trading, if you could just share a bit about what you're seeing in Q3 so far in terms of churn, particularly in the market that have come out of lockdown the most and specifically also on the marketplace in the U.K., if you could just share what you're seeing at the moment?

Jitse Groen: Thank you. Let me first address the last question, which is also a little bit difficult to address, because we're in summer and not to say we're also in Q3, but summer is always not the growth season for us. We've disclosed those cohorts, so the cohorts are strong also now. But obviously, we are in a summer period and a lot of people actually have taken the opportunity to go on holiday. So it's very difficult now to say trading is higher or lower than -- it is as expected for the summer period. And we have reiterated the guidance for the 45% or higher growth. So we still stand behind that. Then regarding the unit economics in Australia or actually, Australia is our fastest-growing country, also we invest most. And I would say that the -- also the price investments that we're making in Australia are quite significant. So I think the current situation to look at is not the right situation. We fixed a lot of the issues in that business. Don't forget that we were actually writing off Australia last year and now it's our fastest-growing country. I think there's quite a lot of moving parts. We are testing the Scoober model in Sydney, which is going quite well, and we're speaking with the Australian government to see whether we can get into a situation that we can roll out an employed model but in a competitive way. It's important for us to be able to compete with the freelance model. And therefore, we need a couple of things from the Australian government, and we are in active discussions with them. We do expect that that's going to have a positive impact on our business because of the service levels. We do see that if we have less churn on the couriers, if we can educate the couriers, then the service actually becomes better. And of course, the visibility is very important for us. But don't forget that this is a very small experiment in Sydney and most of the businesses on the freelance model actually in Australia, which is also, by the way, legal in Australia. So it's not that we are trying to correct something that's not in accordance with the law. Like, for instance, the case in Europe, very specifically at Spain and Italy, freelance model is just out of the question. The grocery question for you, Jörg?

Jorg Gerbig: Yes.

Jitse Groen: And I think one question was also what's the logistics share in Australia? That's around 80%. So majority of orders are with logistics there. With regards to Germany or the grocery question, I guess the best picture we actually have from groceries is in Canada, where we're already doing hundreds of -- hundred thousands of orders actually from grocery partners. We have also, in Germany, a couple of retail partners, for example, Shell gas stations is one example. The shops basically from the gas stations or a stores. So the experience we have so far is like it's pretty much complementary to the food offering we have in terms of like you're basically expanding the current peak of the food ordering. So like you have the first peak which is basically food ordering, where you're ordering your pizza or your poke bowl and then afterwards, you're complementing your night by ordering snack bars or chocolate or a drink home. And the nice thing about that is actually that this means it's actually an improvement for fleet utilization, and you're actually expanding the peaks of your fleet, which is very helpful, especially in the employed model because you just usually have a very small window of a peak in food delivery, which is usually about 1.5 hours or so. And a lot of the countries legally, we have to staff people at least 3 hours in an employed model, for example, and therefore, widening this peak is really a great improvement of the utilization of our fleet. So we already see some positive impacts from that. And in terms of unit economics, seems to be in line with delivery, what we see so far.

Operator: And the last question is coming from Andrew Gwynn Exane BNP Paribas.

Andrew Gwynn: Two questions kind of very quickly. Firstly, on the guidance. Obviously, there's quite a significant range for the second half, I think about €140 million gap implied between the bottom and the top. So I'm just wondering if you can give us a bit more help on where in the range you would expect to land? And the second question, which is for Matt. I appreciate you dialed in very early. Obviously, New York very significant in Grubhub, I guess maybe 50% of GrubHub. But the other markets outside of New York, clearly very, very, very competitive. So any kind of big plans, anything we should have in mind there? Any help would be much appreciated.

Jitse Groen: Thank you. I will comment on your first question, and then hand over to Matt. Regarding the guidance for H2, you should think about H2 as slightly better than H1. And the reason for that is, of course, the fee caps in New York, those are quite significant. And therefore, we expect improvement, but you should not expect that to all of a sudden become profitable in the second half. Because also, we are investing significant amounts still, right? We're not done. We had -- the example was, of course, London. We want to be the absolute market leader in London. We need to be, let's say, 2, 3x bigger than the #2 in London, then we're going to be satisfied. So we have no reason to dial down the investments, especially in the U.K., but also in other countries. But we want to make sure that we decrease the losses, because I think it's a sensible thing to do. Matt?

Matthew Mayer Maloney: Absolutely, thanks for the question. I would say that the Grub strategy historically has been very much in line with the JET strategy, which is focused on the major metro areas, focus on your leadership and the network effects that, that brings so that you can drive profits to invest further. And so we've always done that. We think we are the market leader in multiple, potentially populated urban areas around the country. What we've seen in the last couple of years, especially around COVID is the massive acceleration of the suburban orders, which Grub was not positioned to take advantage of. We did not have the deep QSR relationships at the time. And so when you saw the multiple growth outside of the dense urban areas, we did not capture that. However, we also did not erode our positions in the core metro areas, except for the fact that the majority of residents fled the core urban areas during the pandemic. They are now back or coming back. The offices are reopening, but are not fully open. And so we're going to continue to drive as hard as we can on those markets that we believe we are leaders and we can drive a significant profitable business in. So we're not deviating strategy. We're just really, really aggressively investing behind our strength. One detail in the U.S. market is the national television ad are very economical as compared to local or regional television ads. So we have an aggressive campaign on the television, which obviously reaches all markets all across the country. So as we've been building out our QSR relationships over the past year and expanding our supply to match that of our peers so that we can compete in the outer districts, even though that's not our focus, our core metro areas are also receiving the same television ads. Now in Manhattan, where Seamless has been a religion for years, that means that the Grub brand has grown aggressively and, in fact, surpassed the Seamless brand in New York. So that's why it's time now to transition the Seamless brand over to Grub so that we can continue to leverage our assets behind strength and further extenuate our leadership position there. But that's an executive summary of the U.S. strategy and obviously, more to come in October.

Andrew Gwynn: Okay. I appreciate that. And just to clarify, middle of the range should be the kind of early thinking for the full year, so slightly better than the second half? Is that fair?

Jitse Groen: While the GTV loss is minus 1.3%. And if it's going to be better in the second half, it should be better than the 1.3% minus. I think we're done with the questions. So I'd like to round off this analyst and investor call by thanking you for participating and your questions. So you have any additional questions or remarks, please reach out to our Investor Relations team. Thank you.

Operator: Ladies and gentlemen, this concludes this event call. You may now disconnect your lines. Thank you.