Deliveroo reports first full year of profit
A bump in the number of people ordering takeaways and groceries in the UK and Ireland helped Deliveroo swing to a profit last year.
The food delivery company told markets this morning that gross merchandise value (GTV) increased by five per cent to £7.4bn in the year ended December 31, up from £7bn last year.
The company reported a profit for the year of £2.9m, up from a loss of £31.8m last year.
Revenue grew two per cent year on year, from £2.03bn to £2.07bn, while gross profit rose six per cent to £767m.
Its customer base grew by two per cent during the year, and Deliveroo noted that average order frequency increased across every group and retention improved throughout the year.
“The robust results we’ve announced today, with our first full year profit and positive free cash flow as well as GTV growth across our verticals, demonstrate that our strategy is working,” Will Shu, Founder and CEO of Deliveroo, said.
“Whilst the consumer environment remains uncertain, I am confident that we can continue to deliver growth by focusing on the levers in our control: supporting our restaurant partners to meet untapped consumer demand around new occasions, expanding our grocery and retail offering, and continuously improving our CVP [consumer value proposition].”
The company will target GTV growth in the high-single in 2025, and expects adjusted earnings before interest, tax, depreciation and amortiSation (EBITDA) to be in the range of £170m-190m.
In the medium term, it will target mid-teens percentage growth per year in GTV, and an EBITDA margin of four per cent.
“Both earnings before interest, tax, depreciation and amortisation (EBITDA) and group GTV growth [revenue] are set to benefit from this market exit,” Panmure Liberum analysts said.
“[We think] Deliveroo can generate a level of cash flow over the long-term that is currently underappreciated by the market,” Panmure added.