A Deliveroo rider’s bike near Victoria Station on March 31, 2021 in London, England.
Dan Kitwood | Getty Images
LONDON – Deliveroo doubled orders in the first half of 2021 as the appetite for grocery delivery services persisted despite the easing of coronavirus restrictions.
The UK grocery delivery company had orders of 148.8 million in the six months ended June 30, compared to 74.5 million in the same period last year.
The total value of transactions on Deliveroo’s platform doubled to £ 3.4 billion, while revenue increased 82% to £ 922.5 million (US $ 1.3 billion).
Meanwhile, Deliveroo has also narrowed its losses. The company posted a pre-tax loss of £ 104.8 million in the first half of the year, compared to £ 128.4 million it lost in the first six months of 2020.
Will Shu, CEO of Deliveroo, said in a call with analysts that the company had “seen no material impact” from lifting the Covid-19 lockdown in the UK.
The deal experienced “small to moderate” effects from reopening in France and Italy, but this coincided with a shift in demand due to “seasonality,” Shu said. He added that the company had “accelerated growth” in the Middle East and Asia.
It’s the first time Deliveroo has released results since its disastrous IPO in March.
The company fell as much as 30% on the first day of trading as investors worried about the sustainability of its business model and concerns about the gig economy, where Deliveroo is a major player.
Deliveroo stock fell 4% on Wednesday.
“Investors appeared to have lost a bit of appetite for stocks in early trading as the company expects customer behavior to weaken over the course of the year,” said Susannah Streeter, senior investment and market analyst, Hargreaves Lansdown.
“The pandemic has clearly offered Deliveroo a structural growth opportunity, but the longer-term outlook depends on how demand holds up in a post-pandemic world and whether that path to profitability looks clearer.”
Still, the stock is up around 4% so far this week, fueled by news that German rival Delivery Hero has acquired a 5.1% stake in the company.
Delivery Hero co-founder and CEO Niklas Östberg said his company felt Deliveroo was “undervalued” after being “oversold” in its IPO.
Europe’s food suppliers are under increasing pressure to consolidate as competition intensifies. The rise of on-demand grocery delivery startups like Getir and Gorillas has left mainstream players on edge.
Last week, Estonian transportation company Bolt said it plans to enter the online grocery delivery industry after raising € 600 million ($ 702.8 million) in fresh funds from investors.
Deliveroo also invests heavily in groceries. The company announced on Wednesday that its first-half gross margin fell to 7.8% from 8.8% a year earlier as it increased spending on grocery delivery.