German meal-kit maker HelloFresh has pushed back expectations for when it will break-even to 2019 from the fourth quarter of this year, despite raising its revenue outlook.
The company reported a mixed bag of results, with revenues up in the first half but with profits coming in at a loss, albeit narrowing from a year earlier. HelloFresh also said it plans “targeted” investments in meal kits and “beyond” in the latter six months of 2018, with the US a particular focal point.
First-half revenues rose 41.3% to EUR615.2m (US$697.5m), and were up 53.4% in constant-currency terms. Adjusted EBITDA came in at a loss of EUR25.6m, shrinking from a EUR46.5m shortfall a year earlier.
Still, revenue guidance was raised for constant-currency growth to a range of 32-37%, from 30-32%. Margins also improved. The contribution margin climbed to EUR166.2m in the first half from EUR92.4m, and in terms of percentage of revenue was up at 27% versus 21.2%.
Dominik Richter, chief executive and co-founder, said: “The strong first half of this year has proven that we can exceed our own expectations. Our strong margins provide the necessary tailwind for systematically capitalising on additional opportunities in the market. In view of the growing demand in the meal-kit market and beyond, we want to establish ourselves as the best provider across all customer and price segments.”
Founded in 2011, HelloFresh launched in the US in 2013. In March this year, the company snapped up fellow meal-kit maker Green Chef, also based in the US. It also operates in Australia, Canada and Europe.
In a statement announcing the results, HelloFresh said it “recently launched” its EveryPlate brand offering customers simple meal kits such as sausage linguine and chicken and rice skillet.
HelloFresh went on to say: “Particularly in the US, the world market leader is increasingly investing in further differentiating its product offering and pricing structure to reach out to even more customer groups with varying demand patterns.
“The recent launch of the EveryPlate brand already enables the company to gain a strong foothold in the value segment, whereas the integration of Green Chef secures a successful position in the premium segment. At the same time, HelloFresh is exploring promising co-operations with new retail partners worldwide.”