HelloFresh reports strong Q1 returns

Berlin, Germany-based meal-kit company HelloFresh SE reported an all-time high quarterly revenue of €2.02 billion ($2.2 billion) in its first-quarter earnings report Thursday. 

That represents 5.3% growth from the company’s report a year ago and constant currency growth of 3.3%, the company said.  

“Our strong diversification across geographies, brands and business models has allowed us to navigate a volatile macroeconomic environment and continue our strong and profitable growth path into 2023,” said Dominik Richter, HelloFresh CEO and co-founder, in a statement. “Our main focus is now to further expand our customer proposition and provide our customers with an even better experience and even more meal solutions to choose from. I am confident that this will further drive the profitability of our meal kit business.”  

The value of the average HelloFresh order also continued to increase, up 8.9% to €61.2 ($67.47) from the first quarter of 2022. The rate of quarterly active customers decreased by 4.8% from a year ago, but the decline was anticipated “given the COVID effects still prevalent in the comparative period, but increased meaningfully sequentially vs. Q4 2022 by c. one million to 8.11 million.” 

The order rate also remained steady during the period, which the company attributed to meaningful improvements to the product, such as a larger assortment, more options to switch individual ingredients and more flexibility in delivery slots and cut-off times, the company noted.  

Richter noted that the company remains “very excited about the growth prospects of our ready-to-eat business.” “Given our diversified portfolio of geographies and brands we are well set up for future growth and are heading in the right direction of becoming the world’s leading integrated food solutions group,” he added.   

The positive report follows an announcement at an investor meeting  in March, where Richter said HelloFresh aims to substantially improve profitability in the midterm through the expansion of its ready-to-eat business in the U.S. and Australia. “After re-investing a lot of the cash flow generated in its profitable operations globally, HelloFresh nears the end of a multi-year capex investment cycle by mid 2023,” the company said in a letter to investors. “Upon completion, HelloFresh will have sufficient capacity to reach its mid-term revenue targets, while providing a strong moat to the business. This implies meaningful free cash flow generation in the future.”