A HEROIC IDEA WAS BORN ANNUAL REPORT 2018 AT A GLANCE ANNUAL REPORT 2018 DELIVERY HERO AT A GLANCE GROUP ORDERS1 +49% TO 369 MILLION 248 369 ORDERS (MILLION) 2017 2018 3,131 4,454 GMV2 (EUR MILLION) 2017 2018 417 687 , LETTER FROM THE CEO 4 REVENUES¹ ² (EUR MILLION) 2017 2018 OUR UPGRADED VISION 8 –100 –46 REPORT OF THE SUPERVISORY BOARD 16 ADJ. EBITDA (EUR MILLION) CORPORATE GOVERNANCE 22 2018 2017 NONFINANCIAL STATEMENT FOR THE GROUP 46 COMBINED MANAGEMENT REPORT 56 CONSOLIDATED FINANCIAL STATEMENTS 88 RESPONSIBILITY STATEMENT 154 INDEPENDENT AUDITOR’S REPORT 155 GRI CONTENT INDEX 161 1 The reported figures have been adjusted for material M&A and exclude the divestment of India, divestment of foodora (Australia, France, Italy & Netherlands) and Germany as a discontinued operation. Germany revenues were € 21.4 million in Q1ʼ17, € 21.7 million in Q2ʼ17, € 22.7 million in Q3ʼ17 and € 24.3 million in Q4ʼ17, FURTHER INFORMATION 164 € 25.5 million in Q1ʼ18, € 24.7 million for Q2ʼ18, € 25.9 million for Q3ʼ18 and € 29.2 million for Q4ʼ18. India revenues were € 2.3 million in Q1ʼ17, € 2.6 million in Q2ʼ17, €2.5 million in Q3ʼ17 and € 2.5 million in Q4ʼ17. foodora revenues were € 6.3 million for Q3ʼ17 and € 7.6 million for Q4ʼ17, € 7.4 million in Q1ʼ18, € 7.1 million for Q2ʼ18 and € 3.9 million for Q3ʼ18 and € 0.7 million for Q4ʼ18. Numbers have not been adjusted for smaller acquisitions or divestments. Revenues presented for Delivery Hero represent the total segment revenues prior to vouchers. 2 Americas revenues and GMV as well as the respective growth rates are impacted by the Argentinian operations qualifying as hyperinflationary economy according 2 to IAS 29 beginning September 1, 2018. 2018 revenue and GMV is retrospectively adjusted. Comparability is affected as prior period information is not restated. ONAT AA MISSIONGLANCE ANNUAL REPORT 2018 EUROPE ORDERS +41% ASIA ORDERS +50% DELIVERY HERO TO 60 MILLION TO 83 MILLION 43 60 55 83 ORDERS (MILLION) ORDERS (MILLION) 2017 2018 2017 2018 547 735 AT A GLANCE 844 1,214 GMV (EUR MILLION) 2017 2018 GMV (EUR MILLION) 2017 2018 89 116 127 193 REVENUES¹ (EUR MILLION) REVENUES¹ (EUR MILLION) 2017 2018 2017 2018 –16 –15 –52 –28 ADJ. EBITDA (EUR MILLION) ADJ. EBITDA (EUR MILLION) 2017 2018 2018 2017 MENA ORDERS +55% AMERICAS ORDERS +31% TO 191 MILLION TO 36 MILLION 28 36 123 191 ORDERS (MILLION) ORDERS (MILLION) 2017 2018 2017 2018 370 406 1,370 2,100 GMV² (EUR MILLION) GMV (EUR MILLION) 2017 2018 2017 2018 47 62 153 316 REVENUES² (EUR MILLION) REVENUES (EUR MILLION) 2017 2018 2017 2018 –51 –25 18 24 ADJ. EBITDA (EUR MILLION) ADJ. EBITDA (EUR MILLION) 2018 2017 2018 2017 3 LETTER FROM THE CEO ANNUAL REPORT 2018 LETTER FROM THE CEO Dear shareholders, dear colleagues, dear readers, 2018 was another fantastic year for us. We were able to accelerate growth and reached several important mile- stones. In 2018, for the first time we processed more than 1.5 million orders (including Germany) in one day globally. Over the course of the year our GMV amounted to EUR 4.5bn (excluding Germany) and our segment rev- enues to EUR 687 million. Iʼm incredibly proud that we were able to build the company that it is today through entrepreneurial drive and relentless focus on delivering an amazing experience for our customers. Yet despite those achievements, weʼre only scratching the surface of the global opportunity we have ahead of us. While awareness and consumer demand for our services has never been higher, many customers do not order food and other items to their homes yet. And of those who do order food, roughly 90% still call the restaurants for a add directly. While this is certainly true for almost all markets globally, it is even more so for Delivery Hero. Our global footprint is focussed particularly on more early stage markets providing room for growth for the next decades. 4 LETTERON AFROM MISSION THE CEO ANNUAL REPORT 2018 While food delivery is and will remain the core pillar of globally for that purpose, ranging from ideas to help our business, we also follow our customersʼ demands for restaurants utilising their capacity better, to expanding an increasing offering of convenience services. Consum- into dedicated delivery kitchens and completely re-think- ers have ever higher expectations of services like ours ing how a delivery-focused restaurant should work. I am and because of this we are focusing more and more on sure we will have more exciting news to share on this broader on-demand needs. We have therefore upgraded over the next years. our vision accordingly to: Always delivering amazing experiences – fast, easy and to your door. On the corporate development side, we have always made it very clear that we are pragmatic around con- Initially, this expansion of services will be focused on cat- solidation and focus on those markets in which we egories like groceries, flowers and pharma. Currently, we can build strong leadership positions. We have there- operate these services in the Latin America and MENA fore taken strategic decisions to exit those markets in regions and see promising results. In 2018 we rolled out which we didnʼt see the potential for market leading multi-vertical delivery platforms in 9 countries. We see positions at reasonable investment levels, and focused a strong customer demand and this encourages us to our investments on markets where we operate mar- continue to develop those services further. Besides the ket-leading brands. focus on our customersʼ needs, this also allows us to uti- lize our delivery fleets better, which results in even more While the vast majority of our growth is organic, we were efficient logistics. also able to strengthen our market position through smaller acquisitions of complementary marketplace oper- Besides the horizontal expansion to more services for our ations in various countries. In terms of disposals, the sale customers, weʼre also expanding our efforts to transform of our hungryhouse business closed already in early 2018. the food delivery ecosystem by working more closely with Moreover, we also succeeded in divesting our foodora our restaurant partners. We see that, as food delivery operations in Italy, France, Netherlands and Australia. matures in some urban areas, some restaurants start to Finally, we successfully closed the sale of our German be overwhelmed with the demand from our customers operations to Takeaway.com in December 2018. This while some more rural towns still have a more limited transaction enables us to strengthen our global footprint, food delivery offering. We are therefore always looking increase our focus on key growth regions and reinforce for new ways to partner with and support our restaurant our leadership positions. We also used this opportunity partners. We are exploring several different approaches to upgrade our 2019 investment plan and allocate more 5 LETTER FROM THE CEO ANNUAL REPORT 2018 90 OCCASIONS FOR ORDERING FOOD EVERY MONTH capital towards investment opportunities across our seg- our vision. As of today, we deliver more orders than all ments at attractive returns with a net adj. EBITDA impact competitors in our markets combined and have created of negative €250m. a clear global leadership in own delivery. Iʼm immensely proud of our team to have achieved this in such a short We already see promising initial results in the first quar- period of time. ter of 2019 on these increased investments. These results affirm our strong believe that this is the right path for As the market for food ordering is maturing, shifting the company in order to build the most valuable busi- more online and improving in service quality, there is ness over the long-term. In this sense, our entrepreneur- truly enormous potential for further growth. Even I con- ial mindset today is still the same as it was when the busi- tinue to be amazed by the size and continued expansion ness was founded in 2011 and drives us to pursue the of this market opportunity. Looking at the order pene- ever expanding opportunities we see. tration in some of our best cities we even see markets a presence of 10+ years in online food delivery continuing While the marketplace business still represents roughly to grow at a fast pace. As mentioned above, this leads 80% of our overall business, our share of own delivery me to believe that we have barely scratched the surface orders is constantly growing. By pursuing our hybrid of what is possible. There are at least 90 occasions for business model strategy we can add significantly more ordering food every month – breakfast, lunch, and dinner restaurants to our platform (both with and without their every day on 30 days a month – for each and every one own delivery capabilities) and deliver to our customers of our customers. Even in markets with very high order what they are demanding in each of the neighborhoods densities, frequencies do not exceed high single digits we operate in. The fast growth rate of our own delivery per active customer per month. If we just increase the capabilities is driven by our customersʼ increased demand average frequency by a little each year, this will be a huge for fast, highly reliable and traceable order fulfillment – lever on the opportunity and the TAM that we initially something we aim to provide with every order that we indicated at time of IPO. If we continuously improve our execute ourselves and a principle that is ingrained in ordering experience, choice of restaurants, affordability, 6 LETTERON AFROM MISSION THE CEO ANNUAL REPORT 2018 speed of delivery and even add new ordering occasions need in order to give back to the community and imple- to our services, Iʼm sure we will be able to achieve that.