Glovo decides to move to employment based model for delivery riders in Spain and expects to receive reclassification decisions in Spain

Public disclosure of inside information pursuant to Article 17 para. 1 of the Regulation (EU) No 596/2014 on market abuse (Market Abuse Regulation − MAR)

Glovo decides to move to employment based model for delivery riders in Spain and expects to receive reclassification decisions for alleged violations of employment laws in Spain

Berlin, 2 December 2024 – Delivery Hero SE’s (“Delivery Hero” or the “Company”, ISIN: DE000A2E4K43, Frankfurt Stock Exchange: DHER) Spanish subsidiaries operating their food delivery business under the Glovo brand in Spain (“Glovo”) expect to receive reclassification decisions (“Reclassification Decisions”) for alleged misclassification of delivery riders under Glovo’s operational model as introduced in August 2021 from the Spanish Labour Authorities in the near future, given that no final alignment has been reached.

Today, Glovo management decided to change from a freelance model to an employment based model for its delivery riders in Spain to avoid further legal uncertainties leading to an increase of contingencies. The operational model change, limited to Glovo’s business in Spain, is expected to have an impact of approx. EUR 100 million on adj. EBITDA[1] for FY 2025. Despite this impact, Glovo is expected to generate a positive adj. EBITDA in Spain in FY 2025.

The Company expects to increase overall contingency to EUR 440-770 million in the Company’s 2024 full year financial report, up from EUR 330-550 million already disclosed in its 2024 half year financial report. This amount covers social security contributions, fines, VAT claims and other payment charges covering the period until the end of 2024 for Glovo Spain.

Delivery Hero does not intend to recognize any provision, as the Company believes that there is not sufficient legal ground for the Reclassification Decisions to be made.

While pursuing the final court decisions, Glovo will have to provisionally pay or provide bank guarantees for the amounts, which will become due progressively over the next few years. The first payment and/or bank guarantees are expected earliest in Q2 2025.

Delivery Hero confirms its FY 2024 guidance.

[Note: Regarding the definition of the alternative performance measure adj. EBITDA, as well as related information, the Company refers to the corresponding definition included in its 2023 Annual Report in chapter “A. Group Profile” of the Combined Management Report, which has been published on the Company’s Investor Relations website.]

*************

Disclaimer

This release may contain forward looking statements, estimates, opinions and projections with respect to anticipated future performance of Delivery Hero SE ("forward-looking statements"). These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes," "estimates," "anticipates," "expects," "intends," "may," "will" or "should" or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. Forward-looking statements are based on the current views, expectations and assumptions of the management of Delivery Hero SE and involve significant known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. Forward-looking statements should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. Any forward-looking statements included herein only speak as at the date of this release. We undertake no obligation, and do not expect to publicly update, or publicly revise, any of the information, forward-looking statements or the conclusions contained herein or to reflect new events or circumstances or to correct any inaccuracies which may become apparent subsequent to the date hereof, whether as a result of new information, future events or otherwise. We accept no liability whatsoever in respect of the achievement of such forward-looking statements and assumptions.

Responsible Person for this Publication:
Christoph Bast
Head of Investor Relations