Grab Holding Expects To Breakeven In Second Half 2024

Grab Holdings Limited its investor day announced that it is targeting to achieve breakeven on a Group Adjusted EBITDA basis by the second half of 2024.

This comes from its second half of 2022, financial reports where the group adjusted EBITDA is expected to be $(380) million, a 27% improvement compared to the first half of 2022. Grab also announced that it expects group revenues to grow strongly between 45% to 55% year-on-year in 2023 on a constant currency basis. It also expects to reach breakeven for its Digibank operations by 2026.

Anthony Tan, Chief Executive Officer and Co-Founder of the group said, “We’ve been firing on all cylinders to improve our profitability trajectory and deliver growth in a sustainable manner, and the new targets we’ve shared today reflect that.

He added the group plans to leverage its superapp ecosystem as a competitive moat to strengthen its leadership in the region and aims in becoming Southeast Asia’s largest and most efficient on-demand platform.

Alex Hungate, Chief Operating Officer who recently said the group will not be engaging in any mass layoffs said the group will be rolling out proprietary technology to enhance the efficiency of the platform for its merchants and driver partners. While readying for the launch of its digibanks.

As per segment, adjusted EBITDA margins for Mobility recovered back to their expected steady state of 12% as of the second quarter of 2022, and are accelerating deliveries towards segment adjusted EBITDA breakeven by the second quarter of 2023 and steady-state margins of 3% and above.

Driver-partner levels are at approximately 77% of pre-pandemic levels. Just-in-Time Allocation is a new initiative rolled out in 2022 to improve the accuracy of estimates on the food preparation time and allocates orders to drivers to ensure they arrive closer to or only after the food is ready for collection. In July 2022 alone, this eliminated approximately 12 million minutes of driver-partner wait time from our network compared to February 2022.

Grab plans to continue to build tech-driven efficiency that allows driver-partners to make shorter stops, deliver larger batches, and increase overall productivity. As of August 2022, Grab has seen 19% higher batch rates, as well as an 11% increase in trips per transit hour.

The group has expanded its pilot monthly subscription program, GrabUnlimited, to five countries – Indonesia, Malaysia, Singapore, Thailand, and the Philippines. For a flat monthly fee, users enjoy benefits and deals across various services on the Grab superapp, including mobility, and food, and parcel deliveries.

It sees this unique, ecosystem-wide program as a key growth lever and competitive advantage over monoline providers. Its early adoption has shown greater user engagement and retention, larger basket sizes, and increased order frequency. Average GrabFood GMV from GrabUnlimited subscribers is 2.4 times.

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