00:00Well, delivery platform Talabat has reported third quarter adjusted profit of $112 million.
00:05That's a jump from $98 million in the same period last year.
00:09The company is maintaining its full year guidance after raising it last quarter.
00:13However, it's not all rosy for the platform, as it recently lost its CEO and is facing pressure from rival Metwan.
00:19Since listing in December 2024, the stock has steadily tumbled.
00:23For more, joining us is Khalil Fakesh, CFO of Talabat.
00:26Let's start with the numbers.
00:28Are you pleased with the results for the quarter?
00:30Do you think you have good momentum into the end of the year?
00:32First of all, thanks for having me and good morning.
00:34Yeah, absolutely.
00:35I mean, we continue growing fast, 27% growth on year-over-year basis.
00:39And also we're growing profitably and with the disciplined capital allocation.
00:42So we've already, the board, approved the interim dividends for the H1 results, equivalent to $202 million.
00:49So overall, yes, the strong momentum continues to.
00:52Yeah, and maintaining guidance for the end of the year.
00:54We actually revised guidance upwards.
00:56So we revised the guidance for the full year.
00:58We're expecting to have 27% to 29% growth for the full year and maintaining healthy profitability margin, 6.5% adjusted EBITDA margin and close to 5% net income margin as well.
01:09Yeah.
01:09The last time I spoke to Talabat, I spoke to your now former CEO.
01:13And I think many investors are probably asking why he left.
01:17Can you give us some more color on what happened?
01:19Absolutely.
01:20First of all, I think personally, and I think the team, we were really lucky to work under the leadership of Tomas.
01:24It's been a great six years.
01:26And if you look at all the business metrics, it's been going fantastic.
01:29It's just a mutual agreement between him and the board.
01:31I think the positive side is that we would continue to have access to his knowledge.
01:35He remains on the board of director of Talabat.
01:37So we keep interacting with him, get his insights on the strategic of the company.
01:42And I think also on the positive side, Ton, who is the newly appointed CEO, is not a strange face for us.
01:49We also worked with Ton for four to five years.
01:51In fact, he was the chief operating officer where we worked together under the leadership of Tomas also to build the foundation of Talabat.
01:58Yeah.
01:58How much of it was perhaps performance linked?
02:01And the fact that Talabat stock, as I just was saying in my introduction, is down about 36 percent this year in a year where your peers are actually outperforming.
02:10I mean, if you look at the market, unfortunately, we understand the frustration from investors.
02:14It's been, as you said, also, it's been a tough week in general.
02:17But I think if you look at the business performance, we were growing at 30 percent.
02:22Profitability is there.
02:24We continue to see also expansion and strengthening our core value proposition for the consumer.
02:30So if you look at the business, Jumana, basically, if you look at all the metrics, when it comes to acquisitions, the acquisitions is growing fast.
02:38We are already at 7.5 million monthly active customers.
02:40That's more than 20 percent growth on year-over-year basis.
02:44Engagement is also growing.
02:45Frequency is up.
02:46We are at 6.8 order per month.
02:50If you look at also the key pillar of the strategy, the selection, which is, let's say, the content and what the consumers see, improving 20 percent on year-over-year basis.
03:00Same for multi-verticality, same for the subscription program.
03:03So I would say, no, the performance has been doing really well.
03:05And you are getting a lot more competition in this space with Matouan, the rival Qita.
03:10I'm just wondering how you keep your edge.
03:14What is it about the Taliban offering that's going to differ yourself from the competition?
03:17Absolutely.
03:18This space is definitely interesting.
03:21Lots of competition.
03:22I would say competition is not new to us.
03:25But it is definitely more intense now.
03:28I think the way we look at it is just simple.
03:30We are the market leader.
03:31We are the leader since more than five, six years.
03:35We've been in this business for 20 years.
03:37So the way we look at it is that we want to make sure that we continue having this leadership position in the long run.
03:42We will continue investing strategically in the business into the key pillar that I just mentioned.
03:47It's all about making sure that the value proposition for the customers is better.
03:52So selection, experience and affordability and building this ecosystem around it.
03:57So we believe it might be a noisy period, 12 to 18 months for sure.
04:01But we have strong belief that we will continue investing.
04:04What do you think is the most important factor for your customers?
04:08Is it the choice that's available on your platform?
04:11Is it delivery time?
04:12Is it ease of access?
04:14Is it cost?
04:16What is it that they look like?
04:17It's absolutely the three.
04:18I mean, it's just simple.
04:19It all starts with selection or content.
04:21Today we have the largest selection.
04:24We have 80,000 partners on the platform.
04:26So in simple terms, if you are craving for a product or if you want to enjoy a certain brand or certain means,
04:31if you don't find it, you don't interact.
04:33So selection is key.
04:35Number two, we deal with 24-7.
04:37So think about it.
04:39We are a consumer-facing brand 24-7 dealing with hungry customers, right?
04:43So we want to make sure that the experience is always up to expectations.
04:47So experience is very important.
04:49And lastly, of course, do we have value on the platform?
04:51If you look at the last 12 months, our partners actually invested in deals that is translated to consumer with more than half a billion dollars already.
04:59So the three key pillars is definitely important.
05:02And where does FinTech come into all of this?
05:04FinTech is part of the ecosystem, I would say.
05:07So we're trying to not be just a delivery platform per se.
05:11We want to make sure that we create an ecosystem around it.
05:13So we transitioned into multi-verticality.
05:16We are doing the subscription program.
05:18And FinTech is part of this ecosystem.
05:20Today we have two products.
05:22Basically, we have the co-branded card.
05:24We just launched another co-branded card in Egypt with the partnership of CIV.
05:27And we have our own post-paid products in UAE.
05:31And also we are launching it in Egypt as well.
05:34So it's just simply to create more reasons, more value for consumers to remain and stick to our platform.
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