Deliveroo has posted its first half-year profit following its push into grocery and other retail deliveries.
Over the six months to 30 June, the group made a profit of £1.3m, up from the £82.9m loss it racked last year, sending its share price up nearly 10% this morning.
In a “stabilising consumer environment”, Deliveroo noted that the number of purchases by returning customers improved over the period. Gross transaction value (GTV) across the business rose by 6% to £3.69bn, with a 7% rise in the UK & Ireland and a 5% uplift in its international operations. On a constant currency basis, revenue increased by 2% to £1.03bn.
Deliveroo saw continued strong growth in the grocery market having partnered with the likes of Co-op, Waitrose, Asda, and Morrisons. This operation has now reached 14% of group GTV after further penetration in mid-sized baskets (£30-£60).
The business has also recently been expanding into non-food retail deliveries, working with chains such as Holland & Barrett, B&Q, and The Perfume Shop.
Founder and chief executive, Will Shu, 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 cashflow and positive profit for the period.”
Looking ahead, he said: “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.”
NAM Implications:
- It’s all about coverage and drops per stop.
- i.e. carry anything that can be legally delivered…
- …and expand from high-density customer locations.
- Ask Amazon…
