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Allegro CEO Denies Dispute with InPost Amid Arbitration Claim

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Polish e-commerce giant Allegro rejected suggestions of a business dispute with its partners on Friday, despite ongoing tensions with its key delivery provider InPost (INPST.AS).

“We do not believe that we are involved in any business or other dispute with any entity,” said Allegro CEO Marcin Kusmierz, who took charge in June. His comments came after InPost announced in July that it had filed an arbitration claim, accusing Allegro of breaching a long-term delivery agreement by redirecting customers to its own parcel lockers.

InPost, which derives roughly 30% of its Polish revenue from Allegro, has seen its shares tumble more than one-third this year, though they gained 9% on Friday after a sharp 13% drop earlier in the week on weaker parcel volumes. Allegro shares were up around 2%.

InPost CEO Rafal Brzoska has defended the arbitration move as necessary to protect shareholder interests. Allegro, however, emphasized that it respects existing agreements while continuing to diversify its logistics network by adding new partners and rolling out its own lockers to cut delivery costs.

JPMorgan analysts noted that the interdependence of the two companies makes a negotiated settlement likely, though it may reduce InPost’s margins. The bank estimated that Poland will account for 48% of InPost’s revenue in 2025, but that figure could fall to 35% by 2030 as the company accelerates its international expansion.

Allegro Confirms 2024 Outlook as Q1 Earnings Climb, Focus Shifts to Competing with Temu

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Allegro, Poland’s top e-commerce platform, reported a 4.9% rise in Q1 adjusted core earnings in its domestic market and confirmed its full-year forecast, even as competition from platforms like Temu intensifies.

Incoming CEO Marcin Kuśmierz said the company continues to see strong buyer engagement both domestically and abroad:

“Not only is the number of active buyers rising in Poland and internationally, but they also continue to spend more with us on average.”

Q1 Results Overview

  • Adjusted EBITDA (Poland): 859.4 million zlotys ($229.6 million)
    (slightly below analyst expectations of 875 million zlotys)

  • Gross Merchandise Value (GMV):

    • Poland: Up 8.9% to 14.78 billion zlotys

    • International Markets: Up 82%

  • Active Buyers (Group-wide): 21 million (↑5.4% YoY)

    • Of which 6 million are international

Competitive Strategy and Platform Evolution

Despite “not the best” trading conditions in Q1, Finance Chief Jon Eastick noted that the outlook for Q2 is firmer, with the company remaining optimistic for the latter half of 2024.

To differentiate from Asian e-commerce players like Temu, Allegro has removed listings with long shipping times, particularly those from East Asia. This has helped:

  • Increase shopping frequency

  • Boost the number of local merchants on its international platforms (↑56% YoY)

“Removing most of the long delivery time Asian selection helped Allegro distinguish itself,” Eastick said.

Allegro also continues to invest in logistics infrastructure to lower costs and improve service, expanding its network of:

  • In-house parcel lockers

  • Partner-managed delivery points

The share of delivery volumes managed by Allegro rose to 29% in Q1, up from 24% in Q4 2023.

Market Reaction

Despite the overall positive momentum, Allegro shares slipped ~2% in early trading. Analysts at JPMorgan called the result “moderately negative” due to:

  • Slightly softer Polish profitability

  • No upside surprises in GMV growth

Still, Allegro remains Poland’s dominant player and is steadily building out its international presence in Czech Republic, Slovakia, and Hungary, aiming to consolidate its regional leadership.

Allegro to Expand Parcel Locker Network by 2,500 Units in Poland in 2025

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Allegro, a prominent e-commerce firm, plans to expand its parcel locker network by 2,500 units in Poland in 2025, focusing on increasing its share of parcels delivered through its managed services. This move aligns with Allegro’s strategy to gain more control over its logistics and reduce delivery costs.

In a post-earnings interview, Allegro’s Chief Financial Officer (CFO), Jon Eastick, emphasized the company’s commitment to enhancing its managed delivery methods, which provide more flexibility and lower average prices as the network expands. In 2024, Allegro’s delivery costs increased by 22.9% to 2.84 billion zlotys ($736 million), prompting the company to look for more cost-effective solutions.

Over the past few years, Allegro has ramped up its investment in logistics, co-financing delivery services with merchants through its loyalty program and rolling out its own network of parcel lockers. The company added over 1,000 lockers in Poland last year, bringing its total to 4,500 lockers, with an additional 500 lockers in the Czech Republic. Allegro has also introduced a new delivery program that assumes full responsibility for the delivery process. Initially partnered with Orlen, the program will soon include DHL.

By the fourth quarter, 24% of the company’s parcel volumes were managed through Allegro’s own services, and with price adjustments in 2025, Allegro expects its parcel lockers to be more cost-effective than the most expensive third-party suppliers by the end of the year.

This significant increase in logistics investment came as a surprise to analysts at Trigon brokerage, who speculated that it could impact InPost, a parcel locker company with which Allegro has a seven-year partnership. The potential for Allegro to reduce its reliance on InPost in the future may affect InPost’s market share once the agreement expires in 2027.

Despite this, Eastick reassured that Allegro maintains strong relations with InPost, though it is exploring alternative, cost-efficient options for consumers. Following the news, InPost’s shares dropped by 5.9%.