A Deliveroo driver in Paris
The takeaway company narrowed losses in a ‘resilient year of growth’ / Image source: Adobe
  • Adjusted EBITDA ahead of guidance
  • Growth trend improved in H2
  • Positive cash flow targeted for 2024

Shares in Deliveroo (ROO) rose 2.6% to 117.5p after the takeaway company reported significantly narrowed losses and a welcome uptick in revenues in what the food delivery service dubbed a ‘resilient year of growth given macroeconomic conditions’.

The London-headquartered firm also flagged an improved second half growth trend and insisted it is targeting positive cash flow in 2024.

Nevertheless, the shares still languish a long way below their 2021 IPO (initial public offering) levels, which suggests Will Shu-led Deliveroo has work to do to convince investors it can prevail against its rivals.


Results for the year to 31 December 2023 revealed 3% increases in both revenue and GTV (gross transaction value) to £2 billion and £7.1 billion respectively, while Deliveroo pared its annual loss by £262 million to £32 million.

Average value per order climbed to £24.30 from £22.90 and at the adjusted EBITDA level, Deliveroo swung from a £45 million deficit to positive earnings of £85 million, ahead of guidance thanks to delivery network efficiencies, cost savings and ‘optimisation of marketing spend’.

While the adjusted EBITDA margin improved, it remained skinny at a mere 1.2%, demonstrating a key weakness in the food delivery service business model.

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Deliveroo’s growth trend improved in the second half with H2 GTV up 5% year-on-year and orders recovering through the year to be flat year-on-year in the fourth quarter.

The UK and Ireland saw a positive performance, with 7% GTV growth at constant currency. While the international business experienced a 3% GTV decline, it did witness growth in the fourth quarter with the resurgence strong in Italy and the UAE and most other markets showing positive trends.


Deliveroo founder and CEO Shu commented: ‘Our focus on service and value for money continues to build consumer trust, which are fundamental to unlocking future growth in this industry. Alongside this, our restaurant and grocery businesses are performing well, we launched our retail offering, Deliveroo Shopping, and we are scaling our advertising business.

‘Building on the strong progress we made in 2023, I’m excited about the further opportunities ahead. We have clear strategic priorities and initiatives in place to achieve our medium term targets, and I am confident in our ability to deliver continued profitable growth.’


Edison consumer analyst Russell Pointon said that Deliveroo’s shareholders can ‘finally hear their order arriving as the company’s profitability is improving, following a reduction in its annual losses and a modest increase in revenue.’

Pointon added: ‘The company appears to be on a good trajectory with higher expected adjusted EBITDA for full year 2024 of £110 million to £130 million versus full year 2023’s £85 million, and to be free cash flow positive following further cash outflows in full year 2023.’

AJ Bell investment director Russ Mould commented: ‘If Deliveroo can truly deliver positive cash flow in 2024 as it expects then it will be a very significant milestone for a business which came to market racking up losses as it battled Uber Eats and Just Eat Takeaway for supremacy in the food delivery market.

‘The tight control of the purse strings demonstrated in 2023, with marketing expenditure materially lower, has come at a bit of a cost. Order numbers were down across 2023 as a whole, hinting at households feeling more constrained in treating themselves to a takeaway and that there may be a price to paid for Deliveroo’s more fiscally responsible approach.’

Mould also observed: ‘This feels like a market where being the leader brings with it real benefits and further consolidation in the space cannot be ruled out.’

DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (James Crux) and the editor (Martin Gamble) own shares in AJ Bell.


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Issue Date: 14 Mar 2024