Meal-kit firm HelloFresh said that it expects consumers to 'continue to rely on e-commerce solutions to shop for food' even after the COVID-19 pandemic subsides, as it reported a more than doubling of sales during full-year 2020.
The German firm, which was undoubtedly one of the big winners of lockdown, saw sales rise 111% on a constant currency basis to €3.75 billion las year, while adjusted EBITDA grew more than tenfold year-on-year, to €505.2 million.
HelloFresh said that it delivered more than 600 million meals to customers around the world last year, and boasted 5.3 million active customers as of the end of Q4, which was its strongest quarter to date.
This compares to 2.97 million customers as of Q4 2019, the company said, an increase of 78.3%. The number of orders in the fourth quarter stood at 22 million, a 108.8% gain on the corresponding quarter the previous year.
Analyst Comment
But is such growth sustainable in the long term, given the likelihood of COVID restrictions easing as the year progresses?
According to Barclays analyst Alivra Rao, "There is a lot of investor debate on what trends will look like post-COVID, and ultimately that is hard for anyone to know. But the company has an expansive medium-term vision and a strong track record of execution.
"All in all, the KPIs appear to be directionally in the right place; modelling these accurately is hard but the trends make sense," Rao added.
Confident Of Growth
HelloFresh appears to be confident that it can maintain double-digit growth rates even as restrictions ease – the company said that it expects revenue growth of approximately 20% to 25% on a constant currency basis this year, and an adjusted EBITDA margin of between 9% and 12%.
“2020 was without a doubt marked by unprecedented events. On the basis of our robust infrastructure, we managed to scale up our operations quickly to accommodate the rising demand," commented Dominik Richter, CEO and co-founder of HelloFresh.
“Preparing and eating food at home has taken on a whole new meaning. As the pandemic hopefully winds down over the course of 2021, we expect consumers to continue to rely on e-commerce solutions to shop for food, as many have experienced the superior value proposition that we can offer in terms of price, variety and convenience.”
The group has made a number of recent investments in order to further its growth, including the acquisition of ready-to-eat meal firm Factor75 in Chicago, the launch of the value brand Every Plate to Australia, and the unveiling of operations in Denmark.
"Today, we’re able to delight a lot more diverse customer groups than a few years ago," Richter commented. "Our investments into a larger menu, better service levels and better affordability have really paid off. Going forward, we want to further expand our offering and become the leading food solutions group globally”.
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