BEIJING (Reuters) - Chinese food delivery giant Meituan Dianping posted a smaller-than-expected fall in revenue on Monday after its business was hit by nationwide virus curbs but cautioned that the pandemic would continue to have an impact.
After three consecutive profitable quarters, the company said the loss for the first quarter ended March 31 was 1.58 billion yuan ($221.27 million), compared with a 1.43 billion yuan loss for the year earlier period.
Total revenue fell to 16.75 billion yuan from 19.17 billion yuan a year earlier. Analysts on average had expected revenue of 16.11 billion yuan, according to IBES data from Refinitiv.
Beijing-based Meituan, whose sprawling business ranges from hotel booking to ride hailing, warned it would be affected by the pandemic for the rest of the year.
“There are challenges, but COVID-19 is not going to be the end of the world,” the company’s chief executive Wang Xing said on the call. “We’ll keep investing and we’ll keep building.”
The pandemic forced many businesses to close through February but they have been steadily reopening as China controls the virus.
Daily food delivery volumes recovered to roughly 90% of pre-pandemic levels in the week of May 11, Meituan’s chief financial officer Chen Shaohui said during an earnings call.
However, recovery in the company’s in-store services businesses was lagging behind food delivery as customers were still relatively wary about visiting outlets and there remained the possibility of merchants closing.
He also said that the company was conservative about demand recovery in hotel bookings, as they believed consumers’ hygiene concerns would last for a long period of time.
Reporting by Yingzhi Yang in Beijing and Brenda Goh in Shanghai; Editing by Mark Potter, Kirsten Donovan
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