- Shares in Deliveroo PLC rallied on Thursday after the food delivery platform said that 2021 was a year of strong growth that it is on a ‘path to profitability’.

However, Deliveroo also acknowledged it is up against some tough headwinds in the year ahead. Consumers are facing strengthening inflationary pressures, squeezing disposal income. At the same time, restaurants are grappling with higher food, fuel and labour prices.

Shares in Deliveroo were up 6.2% at 123.75 pence in London on Thursday morning. However, the current stock price remains just a third its 390p listing price a year ago.

For 2021, revenue was £1.82 billion, up 57% from £1.16 billion in 2020, but the pretax loss widened to £298.2 million from £212.6 million.

Administrative expenses ballooned by 43% to £785.9 million from £548.0 million, feeding into the widened loss.

Deliveroo said delivery orders totalled 300.6 million last year, up 73% from 173.7 million orders in 2020, and gross transaction value was £6.63 billion, up 67% from £3.98 billion in 2020.

Looking ahead, Deliveroo guides for 15% to 25% growth in GTV at constant currency in 2022, with a higher growth rate in the second half than in first half, due to a stronger comparative for the first half. It forecasts 2022 adjusted earnings before interest, tax, depreciation and amortisation of negative 1.5% to 1.8% of GTV versus negative 2.0% in all of 2021 and negative 3.2% in second half of last year.

Deliveroo expects to reach adjusted Ebitda breakeven at some point in the second half of 2023 or first half of 2024, which would be a ‘key milestone on the path to achieving its longer-term profit ambitions’.

‘We are excited about the opportunities ahead and have today laid out our plans on our longer-term path to profitability. This is a key focus for the Company this year and beyond...At the same time, this year it is clear that all three sides of our marketplace in Europe will face headwinds due to inflationary pressures, the removal of economic stimulus and the broader geopolitical and economic impacts of the conflict in Ukraine,’ said Chief Executive Officer Will Shu.

‘We will continue to monitor developments closely,’ he said. ‘Our 2022 guidance reflects our caution on these factors, but we are confident in our ability to adapt financially to a rapidly changing macroeconomic environment.’

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