Deliveroo rider out on delivery in London
Year-to-date Deliveroo’s shares are up over 66% to 148p / Image source: Adobe
  • GTV expected to be lower
  • Year-to-date shares are up 66%
  • Shu to introduce further ‘growth drivers’

Shares in Deliveroo (ROO) were marginally higher in morning trading despite lowering medium-term guidance for gross transaction value (GTV) growth to mid-teens from 20% to 25% previously. 

Deliveroo aims to reach an adjusted EBITDA (earnings before interest, tax, depreciation, and amortisation) margin of more than 4% by 2026, 'with further upside potential beyond 2026.'

The takeaway platform also reiterated its guidance for full year 2023 which calls for GTV growth in low single digit in percentage terms in constant currency and adjusted EBITDA in the rage of £60 million to £80 million.

Deliveroo made the statement ahead of a Capital Markets event in London for institutional investors and analysts.

Year-to-date Deliveroo’s shares are up over 66% to 148p.

NOT GOOD NEWS FOR DELIVEROO DRIVERS

On 21 November, the UK’s High Court ruled that Deliveroo drivers were not considered employees because ‘they don’t have specified hours, can work for rival companies and can appoint someone to work in their place’ in a landmark case.

Deliveroo riders brought the case against the company in 2017 in an attempt to negotiate better pay and working conditions.

Deliveroo stuck in the mud despite efficiency push

EXPERT VIEW

Analysts at Shore Capital said in a research note: ‘Combining  these  guidance  ambitions,  we  estimate  the  implied step-down is equal to circa 6% adjusted EBITDA. Though our medium-term GTV forecasts are already  more  conservative  on a growth basis than the revised guidance.

‘We estimate a medium-term (to full year 2026) GTV compound annualised growth rate on a base of  full year 2023 equal to circa 10%.’

On a more positive note Shore capital said the introduction of further growth drivers including DIY, homeware and electrical goods should be supportive of a higher penetration in order pooling. 

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Issue Date: 29 Nov 2023