British food delivery company Deliveroo reported a return to order growth in its first quarter, with a 2% increase year-on-year driven by its operations in France, UAE and Hong Kong and continued strength in Italy.
Orders in Britain and Ireland, which account for more than half its total, were flat, it said on Thursday.
Gross Transaction Value
The gross transaction value of its orders increased 6% to £1.83 billion (€2.14 billion), it said, while revenue grew 2% to £514 million (€600.1 million), an acceleration on 1% growth in the previous quarter. Guidance for the full 2024 year was maintained.
In a statement, the company said that it was 'pleased with the start we have made to this year, building on the strong progress in 2023'.
Shares in Deliveroo, which competes with Just Eat Takeaway and Uber Eats, rose 3% in early deals.
'Relentless Focus'
"The team has been relentlessly focussed on delivering service and value for money, helping drive a return to order growth and continued growth in GTV," commented Will Shu, chief executive of the food delivery firm.
"We made particularly strong progress in International markets during the quarter, with notable improvements in France, UAE and Hong Kong, and continued strength in Italy. In UKI, while the consumer environment remains stable but uncertain, our commitment to offering fair prices and a flawless consumer experience is building strong foundations for the future and will continue to differentiate our business."
Shu added that he was "excited about building the best consumer experience possible" and is confident in the firm's ability to "drive profitable growth and sustainable cash generation".
Analyst Viewpoint
Commenting on the business' performance, Russ Mould, investment director at AJ Bell, said, “Deliveroo is seeing growth in transaction value and revenue with international markets, making a strong contribution to overall growth.
"The company is notably sticking with its guidance despite operating in a market with robust competition, but there are signs it is losing ground to rival Just Eat Takeaway in the UK. If you compare the latter’s update with Deliveroo’s today, gross transaction value growth was slightly lower.
“The problem for Deliveroo is not just that it is scrapping with several others for a piece of the same pie but that the pie is getting smaller as people become less willing and able to splash out on regular takeaways.”
Additional reporting by ESM
