Deliveroo losses widen to almost £300m as growth slows down

News

Losses at Deliveroo widened to almost £300m last year as it pumped more cash into its rapid growth plans, with the online delivery giant warning that it will remain unprofitable until at least mid-2023.

With pre-tax losses of £298m in 2021, compared with a £213m loss in 2020, the company laid out its plans for a “longer-term path to profitability”, which ii said is a “key focus” for the company this year.

It is aiming to reach breakeven in core earnings in the next two years.

Revenues for 2021 increased by 57% to £1.8 billion, driven by the increase in sales transactions, which increased by 70% across the business. The London-based delivery firm also reported a 67% increase in transaction value to £6.6 billion in 2021, driven by a 73% increase in order numbers.

Deliveroo said these increases were cancelled out by its significant investment in marketing and technology improvements as it sought to keep momentum after benefitting from higher basket sizes during the Covid-19 pandemic.

Read more: Deliveroo reveals UK appetite for delivery continues to grow

At the same time, Deliveroo has been planting the seeds for future growth by expanding its UK coverage to 77%, compared to 53% at the end of 2020. It added around 19,000 more restaurant sites to its UK platform over the year, while growing its grocery operation to almost 6,000 sites.

Despite this, the business anticipates some difficulties over the next 12 months, in the face of both inflation and the economic impacts from the conflict in Ukraine, saying that “consumers will be operating under a different spending environment”.

Deliveroo founder and CEO Will Shu said the company’s 2022 guidance reflects its caution on these
factors and will “continue to follow developments closely”, adding that he is “confident in our ability to adapt financially to a rapidly changing macroeconomic environment”.

He also said the company had “continued to make good progress in executing our strategy” and that he was proud of its performance and “excited about the opportunities ahead”.

Click here to sign up to Charged free daily email newsletter

 
News

RELATED POSTS

Leave a Reply

Your email address will not be published. Required fields are marked *

Fill out this field
Fill out this field
Please enter a valid email address.

Menu