Deliveroo returns to profit in H1 amid ‘encouraging’ consumer behaviour
As well as improved consumer behaviour, the company’s performance was driven by strong growth in grocery, which reached 14% of group GTV in H1
Deliveroo has returned to profit following a strong performance in H1, as profits hit £1.3m for the period, up from a loss of £82.9m the prior year, as improved consumer retention and growing retail partnerships boosted sales.
GTV was up by 6% to £3.7bn, with a constant currency GTV growth of 7% in UKI and 5% in International, while revenues were up by 2% to £1.03bn. Orders returned to growth of 2%.
It comes as there were “encouraging early signs in consumer behaviour”, with frequency returning to growth and retention improving, supported by improvements in its consumer value proposition, according to the group.
As well as improved consumer behaviour, the company’s performance was driven by strong growth in grocery, which reached 14% of group GTV in H1. This growth was said to be driven by “improved experience and awareness”, and further penetration in mid-sized baskets.
Over the period, the group also focused on driving awareness and increased selection through new retail partnerships and expanded site rollouts with major brands in the UK and UAE.
Will Shu, founder and CEO of Deliveroo, said: “I am pleased with the performance we have achieved this half, which was driven by effective execution of our growth and profitability initiatives. As a result, we reached two major financial milestones: positive free cash flow and positive profit for the period.
“We took important steps to make our CVP even more compelling. We innovated our loyalty programme, Plus, with the biggest changes since we launched the programme in 2017 as we continue to make strides towards our ambition to be a Plus-first business by 2026. I’m also delighted that we have further improved our Net Promoter Score, a key indicator of consumer satisfaction.”
He added: “I strongly believe that consumer trust is the key to unlocking further growth in this industry and that is why we are relentlessly focussed on achieving a flawless delivery experience, along with ensuring fair pricing for our consumers.
“Looking ahead, while there is continued uncertainty in the external environment, I am encouraged by the inflection we are currently seeing in consumer behaviour in many of our markets. The Deliveroo platform is more powerful than ever, and we remain responsive to the external environment while continuing to optimise our proposition for consumers, riders and merchants. We operate across attractive verticals, in large, underpenetrated markets, and it’s clear that there is a lot of room for growth in our industry.”
