Deliveroo, a British meal delivery firm, reported better-than-expected core earnings of £85 million ($109 million) for 2023 and anticipates further progress in 2024 with a transition towards positive cash flow.
Competing against Just Eat Takeaway and Uber Eats, Deliveroo disclosed a 3% year-on-year decline in total orders, although they slightly rebounded in the final quarter to remain unchanged for the year.
Deliveroo’s shares were trading up 1.7% at lunchtime, as its guidance aligned with market expectations.
Restaurant and grocery price inflation contributed to a 3% increase in the total value of orders, amounting to 7.6 billion pounds.
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CEO Will Shu stated that Deliveroo has advanced towards profitability while enhancing delivery speed and reliability for customers.
He said he expected core earnings to increase this year to 110-130 million pounds
“On a free cash flow basis, we were on the brink of break even in ’23 and we’ll improve on that in ’24,” he said in an interview.
In Britain and Ireland, Deliveroo recorded a 7% growth in its gross transaction value (GTV), aligning with the overall market trend, whereas it experienced a 3% decline in its international markets.
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Nevertheless, the company noted a steady improvement in the trend, with international markets returning to growth in the final quarter.
Shu guided to 5-9% growth in GTV this year, in line with market forecasts that average 7.4%.
Deliveroo ended the year with 679 million pounds of cash on its balance sheet after returning 309 million pounds to shareholders via a tender offer and buybacks.
Shu said he would keep the cash position under review. “We’ll consider different things but right now we’re very happy with where we are,” he said.
