Just Eat (LON:JE.)

Just Eat (LON:JE.)

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Just Eat RNS Release

2018 Annual Report & Notice of 2019 AGM

RNS Number : 9411T
25 March 2019




25 March 2019


Just Eat plc

("Just Eat" or the "Company")


2018 Annual Report and Notice of 2019 Annual General Meeting

Just Eat (LSE: JE), a leading global hybrid marketplace for online food delivery, advises that the following documents have been mailed to the Company's shareholders today and will shortly be available on the Company's website: www.justeatplc.com/investors.

1.    Annual Report and Accounts 2018

2.    Circular containing the Notice of 2019 Annual General Meeting


Copies of the Annual Report and Accounts 2018 and the Circular containing the Notice of 2019 Annual General Meeting are being submitted to the National Storage Mechanism and will shortly be available for inspection at http://www.morningstar.co.uk/uk/NSM.

A condensed set of Just Eat plc's Group financial statements, and information on important events that have occurred during the year and their impact on the financial statements, were included in Just Eat's Preliminary Results announcement issued on 6 March 2019. That information, together with the information set out in Sections 1 to 3 below, which is extracted from the 2018 Annual Report and Accounts, constitute the material required by Disclosure Guidance and Transparency Rule 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service. This material is not a substitute for reading the full 2018 Annual Report and Accounts.  Page numbers and cross-references in the extracted information refer to page numbers and cross-references in the Annual Report and Accounts 2018. 


Section 1. Principal risks and uncertainties

The following information is extracted from pages 20 to 28 of the Annual Report and Accounts 2018.

Effective risk management is an enabler to exploring market opportunity Principal risks and uncertainties.

We believe it is essential to understand and respond to our principal risks while we accelerate our growth agenda.

During 2018, we invested further into our risk management capability by onboarding an experienced Director of Internal Audit and Risk. The director strengthened the team, bringing on board two experienced auditors and an enterprise risk analyst. Recruitment will continue into 2019 as we continue to invest in the team. This will enable, amongst other things, the Internal Audit and Risk team to complete a maturity assessment of the internal control environment, to ensure it remains appropriate given the recent rapid growth of the business. This increase in capability resulted in a refresh of several aspects of our risk management approach and a broadening of risk assessment activities across the Group, functional and country levels. The outputs allowed the Board to carry out a robust assessment of the principal risks facing the Company and were a significant constituent of the Audit Committee's agenda. The Board also noted greater prominence of formal risk articulation whilst interacting with the business. The principal risks overleaf include those that would threaten our business model, future performance, solvency or liquidity.

During the year, the Board defined our risk appetite and monitored the management of significant risks to ensure that the nature and extent of those significant risks did not compromise our overall goals and strategic objectives. Our risk appetite influences the culture of our business and how we operate, and this is reflected in our risk management framework as detailed below. New risks were identified and existing risks assessed over the course of the year as our overall risk profile continued to evolve. Through our ongoing review of strategy and performance in 2018, the Executive Team and the Board ensured that risk management was fully embedded to balance opportunities with a clear understanding of the risks faced and any mitigation required to align to our risk appetite.

In presenting the principal risks on the following pages, the Board has provided details as appropriate around strategic context, mitigation, key risk indicators, categorisation and ownership. Two risks were merged and one risk has been added. A summary of the changes is provided below:

Growth, people and culture - This risk brings elements of the "Growth and scalability" and "People and culture" risks together from 2017. The result is a new risk which speaks to the challenges in balancing our need for greater structure, process and governance as we grow, with the existing culture and entrepreneurial energy that has been responsible for our successes. Furthermore it discusses the cultural and uncertainty risks associated with leadership changes.

Supplier resilience - This is a new entrant into our principal risks and recognises our dependence on a variety of suppliers including large cloud providers, niche technology services companies, outsourcers, delivery logistics suppliers and device manufacturers. Dependent on supplier, disruptive impacts could be experienced across our online platforms, our operational call centres and our expanding delivery networks.

Certain business risks we face, such as those disclosed within Note 20, are generally faced by other comparable online businesses. There are also additional risks that the Group is exposed to that are not considered principal risks but may have an adverse impact if they occur.

Risk management framework

The exposure to risk is an inherent part of running a business and the Board recognises that rigorous safeguards and a sound risk management process are required to mitigate such risks. Risk is an agenda item at Board meetings and the overall process for identifying and assessing business risks and managing their impact on the Group is subject to review by the Board.

The risk management process, illustrated below, seeks to identify and assess risks through both top-down and bottom-up processes.

Top-down processes encompass risk identification and assessment of probability and impact across Group, functional and country dimensions. This process generates risk registers across Just Eat, with risks being assigned to owners and mitigating actions being agreed and tracked.

Bottom-up processes encompass the "blueprinting" of inherent risks across Just Eat's process universe. This involves line management taking responsibility for understanding their day-to-day risk and control environment, and collaborating with the internal audit and risk team to articulate this understanding in formal artefacts. This manual activity today represents the beginning of a vision to ingest this data into an automated risk solution in order to deliver powerful risk information and visualisations to aid decision making in the future.

The Executive Team supports the Board in monitoring our risk exposure through regular reviews. The risk register and the methodology applied are subject to review by the Executive Team and are updated to reflect new and developing risks that might impact the business. Where exposure is outside of our risk appetite, the issue is communicated to the Board alongside proposed actions to mitigate the risk. The corporate risk register is presented to, and reviewed by, the Board and Audit Committee on a regular basis.

Longer-term prospects

The sections described "Our Business Model" and "Our markets" in the Strategic Report describe how the Board has positioned the Company to take advantage of the growing markets in which the business operates and how the Company is positioned to create value for shareholders, taking account of the risks described in this section of the Annual Report.

Viability statement

In accordance with provision C.2.2 of the Corporate Governance Code, the Board has assessed the prospects of the Company over a longer period than the 12 months required when preparing financial statements on a Going Concern basis. This assessment involved a robust review of the principal risks facing the Company and Group, particularly those which could impact solvency, performance or the Group's business model. The Board conducted this review for a period of three years, which was selected as this is the period covered by the Group's three-year strategic plan approved by the Board on 6 February 2019.

The three-year strategic plan considers the Group's cash flows, Underlying EBITDA, investment in areas such as marketing and technology and key financial ratios over the period. For the purposes of the viability statement, certain key assumptions of the plan were subjected to sensitivity analysis, both individually and in aggregate, to ensure the business is still viable in a stressed environment and to identify if any additional financing requirements would be required.

The sensitised scenarios model the impact of certain of the Group's principal risks materialising. For example, a fall in orders due to a total outage from an unmitigated technology failure (Technology resilience), an unexpected change in legislation (Social, regulatory, and legislative), a sudden and sustained inability to process card payments (Supplier resilience) and an adverse outcome from ongoing taxation audits, as well as downside impacts that may result from competition and economic headwinds e.g. Brexit. Mitigating factors to address these risks, which might include a reduction in marketing spend, delaying or cancelling discretionary activities and a headcount freeze, have not been modelled. These assumptions formed the a "reasonable worst case" scenario.

The three-year strategic plan does not include cash flows in respect of any future mergers and acquisitions that might be approved by the Board in the future. Such activities will be approved by the Board having regard to the Company's financial position and projected cash flows at such future time.

Based on the results of this analysis, and assuming that any impact of the Group's principal risks does not exceed the impacts modelled, the Board has a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the three-year period of their assessment to 31 December 2021.

Going concern

In adopting a going concern basis for preparing the financial statements, the Directors have made appropriate enquiries and have considered the Group's cash flows, liquidity position, borrowing facilities and business activities as set out on page 18, in Note 20 to the Group's financial statements on pages 124 to 128, and the Group's principal risks and uncertainties as set out on pages 20 to 28.

Based on the Group's forecasts, the Directors are satisfied that the Company, and the Group as a whole, have adequate resources to continue in operational existence for the foreseeable future. Accordingly, the financial statements have been prepared on the going concern basis.


EU referendum ("Brexit") update

With the scheduled withdrawal of the United Kingdom under Article 50 on 29 March 2019, we have continued to monitor developments and potential impacts that Brexit may have on our performance and results. Our ongoing work with the British Takeaway Campaign, which had an active year engaging with MPs and responding to government consultations on matters such as immigration and skills shortages, has allowed us to keep abreast with those risks and issues that are of most concern to the takeaway industry. The Campaign's efforts have also helped represent the industry as post-Brexit policy has been developed.

There remains significant uncertainty as negotiations extend into 2019; however, we have concluded that Brexit risks fall within our overall "Global economic and political headwinds" principal risk, rather than being a principal risk in its own right. We provide a summary of the potential direct and indirect impacts we have considered in arriving at this conclusion:

Potential direct implications

Currency risk

A further weakening of sterling would serve to increase our reported revenue. Our growing International business now accounts for 51% of total Group revenue. However, certain investments and expenditure are non-sterling, which would have the impact of reducing profit.

Consumer spending

Adverse economic conditions arising out of increased inflation or interest rates could impact consumers. However, our experience is that the takeaway industry is resilient and that consumers may exchange takeaways as an alternative to more expensive out-of-home dining.

Employee attrition

Changes to immigration policy or impacts to residency status could affect our employee attrition rates. A low percentage of UK based employees are EU nationals.

Potential indirect implications

Restaurant Partner contraction

Under a scenario where Brexit has a significant adverse impact on the UK economy, there is a risk that lines of credit and borrowing products may be more difficult to access, increasing liquidity and business closure risks.

Skills and capacity shortages

Restrictive changes to UK migration policy have the potential to add further burdens to an existing skills and capacity shortage within the restaurant, takeaway and delivery industry. This could impact short-term industry performance but perhaps more importantly could impact the longer-term growth of our industry.

Cost and availability of food

Recent public debate around the cost and availability of food and the impact of a no-deal shift to WTO rules in a post-Brexit UK signifies the ongoing uncertainty around the net cost impact of imported food for the industry. Further concerns regarding EU farming subsidies and the UK food manufacturing industry's dependency on migrant workers increases the risk further. This knock-on impact to our Restaurant Partners may adversely impact our commercial terms with them.

Key to principal risks table on pages 23 to 28

Category - We categorise risks to better understand the spectrum and scale of risks that fall into certain groupings.

Owner - The primary Executive Team member accountable for the risk.

Risk movement - Considered on a net basis, recognizing changes in both gross risk measurement and the offset of any advancements or regression in mitigation.

Key risk indicators - Metrics and criteria used by management to understand both risk exposure and effectiveness of mitigation.

Strategic pillars

1 Enhancing our unrivalled marketplace foundation 

2 Targeted world-class delivery to complement our marketplace 

3 Highly experienced team, supporting extraordinary local customer experts




Owner: Chief Executive Officer

Change: Risk increased

Link to strategic pillars: 1 2 3

What is the risk and impact?

An inability to counter the increased scale, service experience, choice and funding of our competitors over the short to medium term.

Over the longer term, an ineffectual response to either the development of new business models by competitors, the strengthening of existing players or the disintermediation of material Restaurant Partnerships.

This could adversely impact market share, growth, revenue, margin and overall profitability.

What is the strategic context?

Countering competition risk is central to our hybrid strategy of evolving Just Eat towards a global delivery capability to complement our highly successful marketplace business and further open market opportunity. See SkipTheDishes integration and reorganisation on page 26. Furthermore, we have placed significant focus on growing our partnerships with Branded Restaurant Groups, and enhancing service experience through our ongoing innovations on our platform. See Changing service experience.

How is the risk managed?

Global delivery underway - We have brought Australia and parts of the UK onto our global delivery model and are carefully monitoring performance.

Roll-out plan - We have a programme plan for the roll-out of targeted delivery across other territories.

Strategic partner growth - We have teams and specialists focused on extending our range to include the branded meals our customers really enjoy.

Ongoing business intelligence - We closely monitor territory performance through advanced analytics.

Key risk indicators

• Order volumes/growth trends

• Net new customers

• Customer satisfaction and loyalty levels

• Restaurant satisfaction and loyalty levels

• Delivery revenue

• Driver cost per order

• Overall order margins

• Market share



Changing service experience

Owner: Chief Product and Technology Officer

Change: Risk stable

Link to strategic pillars 1 2 3

What is the risk and impact?

The Group's pace of technology change fails to meet either the evolving expectations of our customers and Restaurant Partners, or the velocity of our competitors.

This could impact our brand, customer and Restaurant Partner experience and loyalty and ultimately market share, revenue and profitability.

What is the strategic context?

Allied to our rapid growth, we have inherited multiple platforms and code designs that can prolong deployment of new features to market. We continue to focus on moving our markets onto our core strategic platform and introducing modular and flexible designs to increase agility.

Optimising our pace of technology change is an important factor - to be an industry leader, to meet the increasing demands of both customers and our Restaurant Partners, and to be confident that our platforms will bring our hybrid service experience to life.

How is the risk managed?

Product roadmap - We develop our service experience against a clear roadmap of prioritised features and improvements.

Customer and Partner product development teams - We have dedicated teams which innovate and develop new features for our services.

Organisational and operational reviews - We undertake periodic assessments to ensure we align to leading digital development and operational practices.

Service platform consolidation - We are undertaking discrete initiatives to homogenise our core platform across the markets we operate in.

Key risk indicators

• Customer satisfaction and loyalty levels

• Restaurant satisfaction and loyalty levels

• Ease of use metrics



Social, regulatory and legislative change

Owner: Group General Counsel

Change: Risk increased

Link to strategic pillars: 2 3

What is the risk and impact?

Increased social pressures or changes in laws and regulations adversely impact the business, or we fail to obtain required regulatory approvals or licences.

Impacts include brand and reputational loss, compromised revenue streams and/or increased cost of operations. Additionally, instances of non-compliance or adverse judgements could result in litigation, fines, revocation of licences and financial loss.

What is the strategic context?

Society is placing increased pressures on businesses to take on greater responsibilities. As a technology takeaway platform, several factors relating to workers' rights and benefits, food, health and the environment represent important areas of focus for the public.

In addition, our operations across several markets expose us to a variety of laws and regulations. Allergens, food safety and payment services regulations are examples of applicable areas, but more broadly GDPR, customer protection, competition (anti-trust), bribery, modern slavery, money laundering, taxation (including EC State Aid investigations, ongoing tax disputes and Digital Services Tax) and reporting.

How is the risk managed?

Corporate communications - A dedicated team communicate externally and channel feedback and public opinion back into our organisation to drive improvement.

Monitoring and compliance - Our in-house legal, finance, tax and compliance functions monitor emerging, new and evolving risks, while Internal Audit assess compliance and controls.

Access to expertise - Where required, external specialists supplement our teams to assess, scope and plan responses to changes in the regulatory landscape.

Change projects - We establish discrete project teams to address significant legislation changes.

Key risk indicators

• Monitoring of emerging topics and government consultations

• Internal operational compliance reporting

• Internal audit findings




Owner: Chief Executive Officer

Change: Risk stable

Link to strategic pillars: 1 2

What is the risk and impact?

An event, or a series of events, inflicts considerable harm to our brand over the short term. An ineffectual brand strategy weakens our brand or its authenticity over the longer term.

A significant decline in brand value would result in the loss of new and existing customers and Restaurant Partners, impacting orders, revenue and overall profitability.

What is the strategic context?

Our level of investment in marketing indicates the importance of our brand in driving customer and Restaurant Partner acquisition and loyalty. It is therefore essential that our brand is positively perceived and resonates with the pleasures associated with our customers' and Restaurant Partners' food moments.

As we continue to grow, we will be engaging with more third parties by way of couriers, contractors and logistics and outsource suppliers who may use our branding. Their actions and behaviours will reflect on our brand, which bears risk.

How is the risk managed?

Brand ownership and strategy - Senior accountability, strategies and plans exist to enhance and protect our brand.

Crisis management - Management and communication plans are established to minimise brand damage following an adverse event.

Proactive initiatives - We live our brand values and we are involved in initiatives such as the BTC, Sustainable Restaurant Association and the Better Fast Food Network.

Protocols and organisation - Skilled teams operate within established brand policies and guidelines.


Key risk indicators

• Customer satisfaction and loyalty levels

• Restaurant satisfaction and loyalty levels

• Ongoing market research metrics



Cyber security and data protection

Owner: Chief Product and Technology Officer

Change: Risk stable

Link to strategic pillars: 1 2

What is the risk and impact?

We sustain a major security breach or lose control of sensitive systems and data.

A major security breach has the potential to cause significant operational disruption, data theft or destruction, malicious damage and/or theft of assets. Further loss of control over data could result in private or commercially sensitive data being made available to unauthorised parties.

Following such an incident, it is probable that the reputational and operational impacts would weaken orders, revenue and underlying profitability and could lead to regulatory impact.

What is the strategic context?

Our customers' and Restaurant Partners' trust is critical and depends on us providing secure systems. Our strategy is therefore to develop a strong cyber security and data governance capability that is adaptive to a continuously evolving risk profile. We also seek to implement pragmatic yet robust security solutions so that security is seen as an enabler and further embeds into Just Eat's culture.

How is the risk managed?

Security team - We are growing our security team to support business projects, monitor operations, identify and resolve vulnerabilities and rapidly respond to cyber incidents.

Security systems - We are building advanced detection and prevention systems to protect our environment and quickly detect potential issues.

Identity management - We continue to integrate and enhance identity management to ensure there is one source of truth across Just Eat.

Data governance - We have invested across people, process and technology to govern and protect our data.

Key risk indicators

• Externally sourced threat intelligence

• Volumes, trends and root causes of prevented and detected attacks

• Network and system health and status of critical updates

• Unapproved changes reaching production environment

• Internal audit findings




SkipTheDishes integration and reorganisation

Owners: Chief Executive Officer and Chief Financial Officer

Change: Risk increased

Link to strategic pillars: 2

What is the risk and impact?

We fail to (i) integrate and mature SkipTheDishes' governance in line with the Group, and/or (ii) reorganise effectively to capitalise on SkipTheDishes' global delivery role.

Dependent on the risk, impacts could range from data, intellectual property or financial losses, service quality impacts, regulatory non-compliance and any associated brand and reputation damage.

What is the strategic context?

Just Eat Canada was operationally merged into SkipTheDishes during 2018 and, using the SkipTheDishes business model, has significantly grown to become the Group's second largest national market.

Further, SkipTheDishes is now central to the Group's delivery and logistics strategy, responsible for building logistics solutions and providing centralised operations for other Group businesses.

How is the risk managed?

Leadership changes - We have made significant changes to the leadership of SkipTheDishes during 2018, bringing in experienced executives to strengthen leadership capability.

Governance changes - We moved an experienced Just Eat Finance Director to Canada and have built and strengthened teams responsible for compliance across legal, finance, security and risk. We will continue with further changes through 2019.

Organisational changes - These are underway to bring clarity to global delivery versus Canadian market responsibilities.

Transparency - We launched the Group's whistleblowing policy and anonymous contact process in Canada.

Key risk indicators

• Governance-related complaints

• Whistleblowing cases

• Projects' status for global delivery roll-out

• Projects' risks for global delivery roll-out




Technology resilience

Owner: Chief Product and Technology Officer

Change: Risk decreased

Link to strategic pillars: 1 2

What is the risk and impact?

Widespread and/or prolonged outage of critical platforms and infrastructure that support our services to customers and Restaurant Partners.

Due to the online nature of our businesses, large-scale outages would have an immediate impact on orders and revenue as customers would be unable to transact with us. Thereafter, the impact to our brand could deepen if we were unable to pass collected revenue back to our partners or pay our suppliers.

What is the strategic context?

Offering a reliable service is key to building our customers' and Restaurant Partners' loyalty and trust. That is why we innovate and operate with a resilient mindset and have increased our reliability capability and performance through 2018, lowering this risk from prior levels.

Our technology profile includes large data processing platforms enabled through cloud infrastructure, which offers the resilience and scalability of highly redundant architecture, but inherently brings with it cyber, networking and computing risks.

How is the risk managed?

Architecture - Our platforms are all hosted on Amazon Web Services on a "three site basis" to provide multi-site resilience and failovers to reduce the risk of major outages and to enable rapid restoration of services.

Monitoring - Our specialist technology teams provide 24/7 monitoring of our platforms and respond to outages.

Business recovery - We have implemented recovery plans to minimise disruptions and facilitate the resumption of services.

Key risk indicators

• Systems availability/percentage of uptime levels

• Backup success metrics

• Outage root cause and problem management metrics

• Results of business recovery exercises



Growth, people and culture

Owners: Chief Executive Officer and Chief People Officer

Change: Risk increased

Link to strategic pillars: 1 2 3

What is the risk and impact?

We change our scale and organisation without protecting the positive and powerful aspects of our culture today as an agile, entrepreneurial business.

In addition, the changes across our senior leadership team create uncertainty and/or impact on the positive aspects of our culture, increasing this risk.

This may in turn impact our ability to attract and retain key talent, affecting our achievement of strategic objectives and performance milestones.

What is the strategic context?

As we grow in scale and complexity as a listed business, we will continue to introduce structural, leadership, process and governance improvements that allow us to manage and control our business effectively.

However, we recognise that the energy and creativity we have comes from our cultural underpinnings as a disruptive, entrepreneurial business and this is worth protecting. Therefore we seek to strike the right balance when making leadership changes and adopting corporate best practices to ensure our culture is protected.

How is the risk managed?

Talent assessment - This provides leadership and decision making on investing, succession planning and management of our talent pipeline, in line with our values, vision and strategy.

Change Management - Through planning and consistent two-way communication, we ensure collective alignment and employees that are engaged with business change.

Employee voice - We listen to our employees, and regularly measure their engagement to ensure we have a clear employee value proposition that motivates and retains our talent.

Inclusive culture - Through our diversity, inclusion and belonging programme, we are striving to create a culture of inclusion and openness that drives actionable feedback from our workforce.

Key risk indicators

• Levels of existing talent

• Number of critical vacancies

• Time to hire data

• Key employee engagement metrics



Supplier resilience

Owner: Chief Financial Officer

Change: Risk increased

Link to strategic pillars: 1 2

What is the risk and impact?

Any of our key suppliers suffer significant and prolonged loss of their services, disrupting our business operations.

Dependent on the supplier, disruptive impacts could be experienced across our online platforms, our operational call centres and our expanding delivery networks. This could impact orders, revenue, customer and Restaurant Partner experience, and ultimately our brand in the most severe of cases.

What is the strategic context?

We rely on an extensive network of suppliers including, amongst others: large cloud providers, niche technology services companies, outsourcers, delivery logistics suppliers and device manufacturers. A combination of our growth and the maturing of our third party governance and controls has increased visibility and appreciation of this risk to the point of inclusion as a principal risk.

Aligned to our focus on building trust and loyalty across our customers and Restaurant Partners, it is important that we understand our supplier base and have the necessary contingency and mitigation strategies in place to minimise our risks.

How is the risk managed?

Technology - Single points of disruption risks are reviewed, prioritised and acted upon by the CIO.

Operations - We have globally distributed outsource capabilities divided across tier one suppliers with cross-site failovers and approved local recovery plans.

Delivery logistics - As we execute our global delivery strategy, we are building logistics solutions with resiliency requirements and recognise the ability to balance external providers with our internal SkipTheDishes service.

Ordering devices - As part of our device management lifecycle, we evaluate our suppliers and associated risks.

Key risk indicators

• Systems availability/percentage of uptime levels

• Operational incident reporting

• Logistics incident reporting

• Supplier risk evaluations



Global economic and political headwinds

Owner: Chief Financial Officer

Change: Risk stable

Link to strategic pillars: 1 2 3

What is the risk and impact?

Significant economic or political events weaken order volumes and/or growth projections in one or more of our markets or threaten to disrupt our operations.

Economic and political factors have the potential to represent both risks and opportunities. For example, Brexit may have adverse implications on immigration, access to talent and food price inflation, impacting the Group and Restaurant Partners. The opportunity of customers' "trade down" behaviour increasing online takeaways represents upside during a recession. A particularly deep and prolonged event has the potential to change behaviours, which could adversely impact revenue and underlying profitability.

What is the strategic context?

The world continues to be volatile on a number of fronts including ongoing Brexit uncertainty, signs of economic slowdown in Europe and China, and conflicts in world trade. Due to the wide-reaching and systemic nature of this risk, it is strategically important for us to understand that we have taken all necessary steps within our control to mitigate it.

This risk has the potential to impact performance in one or more markets, disrupt operations and potentially threaten the safety of personnel working for us, or on our behalf.

How is the risk managed?

Impact assessments - When events such as the Brexit referendum occur, we conduct analysis to understand possible impacts and to mobilise action plans as necessary.

Cash investments - We restrict investments of liquid resources to AAA-rated money market funds and lodge deposits with approved counterparties.

Diversification across the globe - Our global footprint continues to diversify as Canada grows to be our second largest territory, with the consequent advantage of reducing our reliance on primary markets.

Financial planning - We conduct rigorous financial planning to manage and monitor cost versus revenue performance.

Key risk indicators

• Net new customers

• Order growth

• Reorder frequencies

• Acquisition cost of new customers

• Restaurant churn rates


Section 2. Directors' Responsibility Statement

The following information is extracted from page 142 of the  Annual Report and Accounts 2018.

Directors' Responsibility Statement

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations. UK company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the Group and Parent Company financial statements in accordance with IFRS, as adopted by the European Union. Under UK company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company, and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to:


• select suitable accounting policies and then apply them consistently;

• make judgements and accounting estimates that are reasonable and prudent;

• state whether applicable IFRS, as adopted by the European Union, have been followed, subject to any material departures disclosed and explained in the financial statements; and

• prepare the financial statements on a going concern basis unless it is inappropriate to presume that the Company will continue in business.


The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements and the Directors' Remuneration Report comply with the Act and, as regards the Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.


Each of the Directors, whose names and functions are listed on pages 40 to 41, confirm that, to the best of each person's knowledge and belief:


• the Company and Group financial statements, which have been prepared in accordance with IFRS, as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the Group and the Parent Company; and

• the Strategic Report and Directors' Report include a fair review of the development and performance of the business and the position of the Company and the Group, together with a description of the principal risks and uncertainties that they face.


The Board considers the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the Company's position, performance, business model and strategy.




Section 3. Related party transactions

The following information is extracted from page 133 of the Annual Report and Accounts 2018.

26. Related party transactions

During the year, we entered into transactions in the ordinary course of business with related parties. Further details are provided in this Note.

Compensation of key management personnel

Key management personnel comprises members of the Board and the Executive Team. Key management personnel compensation is shown in the table below:






Short-term employee benefits



Post-employment pension



Termination benefits



Share based compensation



Total compensation of key management personnel




The amounts disclosed in the table above are the amounts recognised as an expense during the reporting period related to key management personnel, which are disclosed in more detail in Note 7. Further information concerning Directors' remuneration, shareholdings, pension entitlements, share options and long-term incentives, as required by the Act, is shown in the Annual Report on Remuneration on pages 69 to 85.


On 24 March 2014, prior to the IPO, the Company called all the unpaid subscription amounts, totalling £13.2 million, in respect of certain shares issued under the JSOP. In order to facilitate this, the Company made loans to participants of the JSOP and Estera Trust (Jersey) Limited totalling £5.3 million and £7.9 million, respectively. The loans provided to the participants of the JSOP included loans to key management personnel totalling £4.9 million. As at 31 December 2018, the amount due from key management personnel in respect of these loans was £nil (2017: £0.2 million).


Key management personnel's interests in the PSP, the JSOP and the EMI scheme

The outstanding share options and awards held by key management personnel are summarised below:









exercise price

Year of issue



Vesting date





Up to April 2012





Up to July 2016





Up to May 2018





Up to December 2019





Up to September 2020





Up to September 2021





Refer to Note 7 for further details about the PSP, JSOP and EMI schemes.


Amounts owed by or to related parties

With the exception of key management personnel and £1.1 million (2017: £0.6 million) accrued for IF-JE management services, no amounts were owed by and to related parties at the balance sheet date.


Other transactions with related parties

As explained in Note 15, funding transactions took place with companies in which a non-controlling interest is held by us.




For further information, please contact:

Tony Hunter

Company Secretary

Just Eat plc                                                                 + 44 (0) 207 603 1515


About Just Eat:

Just Eat plc (LSE: JE) operates a leading global hybrid marketplace for online food delivery. Headquartered in London, we use proprietary technology to offer a quick and efficient digital ordering service for over 26 million customers and more than 100,000 Restaurant Partners across the UK, Australia & New Zealand, Canada, Denmark, France, Ireland, Italy, Mexico, Norway, Spain, Switzerland and Brazil.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.

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