SINGAPORE (THE BUSINESS TIMES) - Grab expects its food delivery business to break even by the end of 2021, following positive earnings before interest, taxes, depreciation and amortisation (Ebitda) recorded in several of its markets in the second quarter of 2020.
The Singapore-headquartered company nearly tripled food delivery net revenues year-on-year in Q3 2020, its president, Mr Ming Maa, said in a newsletter on Monday (Jan 4).
This was achieved by supporting small businesses, Mr Maa added. Grab brought nearly 600,000 new merchants across South-east Asia onto its platform in 2020, more than doubling the number of merchants it worked with.
Meanwhile, the group has broken even in ride-hailing in all of its operating markets, including its key battleground of Indonesia, home to its fiercest rival Gojek.
Group revenues have returned to well over 100 per cent of pre-Covid levels. Total group net revenue grew about 70 per cent year on year in 2020.
"Throughout this period, we've continued to be disciplined with spending and prudent in stewarding our shareholder capital, with monthly Ebitda spend being reduced by approximately 80 per cent over the last 12 months," said Mr Maa.
He added that Grab will continue to focus on the more than 70 million small and medium-sized enterprises (SMEs) that account for 99 per cent of all businesses in South-east Asia, and which are key to the region's economic recovery.
"In the new year, we want to keep focusing on this by creating a ripple effect that benefits not just the businesses that get on our platform, but the entire value chain that supports them," he said.
Grab's consortium with Singtel was recently awarded a digital full bank licence by the Monetary Authority of Singapore. This accelerates Grab Financial Group's plans to serve more under-banked individuals and SMEs in Singapore, said Mr Maa.