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Foody Cyprus parent debuts in Germany

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Foody Cyprus parent Delivery Hero is entering the German market with food delivery and quick commerce operations in four Berlin districts, followed by launches in Frankfurt, Hamburg, and Munich in the autumn.

After weeks of testing in selected neighbourhoods in its home city, Delivery Hero launched its app in Berlin this week under the brand foodpanda through partnerships with local restaurants and stores, as well as Delivery Hero-owned warehouses called pandamarkets.

In other regions, the delivery-only stores are also known as DMart.

“After testing the foodpanda app for a few weeks, we are confident to deliver on our promise to introduce a superior service to the German market, bringing food delivery and quick commerce to local customers through one single app,” said Niklas Östberg, CEO and co-founder of the company listed on the Frankfurt Stock Exchange since 2017.

The expansion will continue with more launches before the end of the year, covering some of Germany’s biggest cities.

Through the foodpanda app, customers can access pandamarkets for a wide range of convenience items, including a large variety of fruits and vegetables, every-day-articles, snacks, etc.

From its humble beginning in 2011, Delivery Hero has become the world’s leading local delivery platform on four continents, operating its service in 50 countries across Asia, Europe, Latin America, the Middle East and North Africa.

In Europe, it has a strong presence in Scandinavia and central and southeast European markets, including Cyprus, Greece and Turkey.

During the Covid year of 2020, worldwide orders were up 96% to 1.3 bln, and revenue increased by 95% to €2.84 bln, earning it a place in the prestigious DAX index in August.

“In 2020, more than six out of ten orders in the food business were delivered by us, and in many countries, we are close to 100%,” said Ostberg.

“And while many of the COVID-19-related consequences were indeed challenging for our business – in the MENA segment, we saw a 6% decline in orders in the second quarter of 2020 due to curfews and lockdowns – we reached and even partly exceeded our original guidance for the year.”

European orders were up 51% to 128.7 mln, while the total value of goods (gross merchandise value) grew from €1,047 bln to €1,737 bln, revenue nearly doubled from €173 mln to €323 mln, with its financial performance of adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) improving from minus €19 mln to minus €2.2 mln.

Pioneer in nextgen e-commerce

The company aspires to pioneer the next generation of e-commerce, aiming to bring groceries and household goods to customers in under one hour and often in 10-15 minutes.

In March, Delivery Hero acquired 88% of Woowa, South Korea’s largest online food delivery platform, for a consideration of €5.7 bln, consisting of €1.7 bln in cash, €4.0 bln in new shares of Delivery Hero and a contingent consideration of €27.1 mln.

Later in March, it enlarged its investment in its South American partner Glovoapp23 S.L. by investing approx. €229 mln during a financing round.

As a result, Delivery Hero’s shareholding in Glovoapp23 S.L. has increased to 37.4% on a fully diluted basis.

Delivery Hero Cyprus Ltd., formerly AA Foody Cyprus Ltd., is a 100% subsidiary of the group since 2019.

Foody has delivery deals with national chains AlphaMega and Foodsaver, direct-to-client producer Alion, and local supermarkets, wine shops, convenience stores and other retailers.

Since 2019, orders have multiplied from 250,000 to 630,000 per month, while the network of participant restaurants has grown from 861 to 2100.

On its website, Foody Cyprus says it has “200,000 hungry customers.”

In earlier comments to the Financial Mirror, Foody CEO Argyris Argyrou had said his company aimed to handle more than 50% of all food delivery orders placed, regardless of the method.