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HelloFresh SE (OTCPK:HLFFF) (OTCPK:HELFY). 13% higher in Frankfurt after the company reported better-than-expected second-quarter results.
The Berlin-based company reported a 3.1% decline in orders to 28.9 million and a 3.5% decline in meals delivered to 243.8 million in the second quarter. The average order value rose by 5.4% to €67.10, compensating for the decline in volume. HelloFresh (OTCPK:HLFFF) noted that it was the 12th consecutive quarter of average order value growth. This increase was driven by a higher proportion of prepared foods in the assortment, increased demand for premium and customizable meals and market items, and lower price incentives across all product categories.
“Our RTE business continues to be on a structural and profitable growth path. Our investments in our product, our production capacities and our brand are paying off,” explained CEO Dominik Richter.
HelloFresh (OTCPK:HLFFF) said it has taken certain steps to adjust its production capacity, resulting in one-time non-cash impairment charges of €45 million in the first half of 2024, of which €32 million occurred in the second quarter. Adjusted EBITDA decreased 23% year-on-year to €146.4 million, but beat the consensus estimate of €123 million.
Jefferies analyst Sebastian Patulea noted that HelloFresh’s (OTCPK:HLFFF) RTE business is doing well and now accounts for about a quarter of the group’s total revenue. He also highlighted that free cash flow generation was strong, despite the second quarter being historically a low-volume quarter.
