Deliveroo reports strong year of growth, with UK & Ireland’s orders up 72%: Deliveroo has reported a year in 2021 with gross transaction value (GTV) in the UK and Ireland up 71% year-on-year to £3.57bn. The company said that year-on-year GTV growth slowed sequentially during the year, from 142% in Q1 2021 to 36% in Q4 2021, which it said reflected an increasingly tough comparison base in the prior year, as well as lifting of covid-related restrictions during the course of 2021. In 2021, orders grew by 72% to 147.7 million, primarily driven by a 64% increase in monthly active consumers, along with a slight increase in average order frequency. GTV per order was down 1% in constant currency to £24.2. The business said that UK and Ireland revenue grew 64% to £980.7m in 2021, primarily due to the increase in GTV. Gross profit was £330.3m in 2021 compared to £217.2m in 2020, an increase of 52%. Gross profit margin (as % of GTV) was 9.3% compared to 10.4% in 2020. The company said: “This decrease was driven by the reversal of benefits from higher basket sizes during covid-related lockdowns, as well as accelerated investments in consumer acquisition and retention to support future growth. Adjusted Ebitda was £91.1m in 2021, compared to £80.5m in 2020, as increased aggregate gross profit was partially offset by continued investments in growth, including marketing and headcount additions. Adjusted Ebitda was £55.3m in H1 2021 and £35.8m in H2 2021, with the sequential reduction primarily reflecting the phasing of growth investments and the reversal of benefits from higher basket sizes during covid-related lockdowns. During the period, Deliveroo continued to add differentiated content for consumers. UK&I restaurant selection was further expanded, and in 2021 the company added circa19,000 new sites, increasing the base of restaurants by 55%. The company also continued to roll out its grocery offering: at the end of the period, Deliveroo had approaching 6,000 grocery sites live in the UK&I across major partners and smaller independent partners, an increase of more than two-thirds compared to the end of 2020. Alongside achieving strong growth in 2021, Deliveroo made excellent progress in delivering its geographic expansion plan – planting the seeds for future growth. At the beginning of 2021, the company set out a goal to expand consumer population coverage to two-thirds of the UK population by year-end 2021, up from 53% at year-end 2020. As a result of strong operational execution, the UK expansion was well ahead of the original target, with 72% coverage of the UK population achieved at the end of June and 77% at the end of December.” Including its international business, Deliveroo said its overall revenues were up 57% to £1.8bn during the year, primarily due to the increase in GTV, while its pre-tax loss stood at £298m in 2021 compared to £213m in 2020. Will Shu, founder and chief executive of Deliveroo, said: “We have continued to make good progress in executing our strategy and I am proud of our performance in 2021. We grew rapidly across all of our markets, with 70% GTV growth in constant currency – at the top end of our previously-upgraded guidance range. Particularly encouraging to me was our performance in the UK and Ireland, where we continued to grow our market share and achieved profitability on an adjusted Ebitda basis in a competitive environment – highlighting the strength of our consumer value proposition. We are pleased to have strengthened our proposition for our marketplace in 2021, increasing choice for consumers, offering riders more security in the form of improved insurance, and giving our restaurant and grocery partners opportunities to grow their businesses. We are excited about the opportunities ahead and have today laid out our plans on our longer-term path to profitability. This is a key focus for the company this year and beyond. We aim to reach breakeven at some point during H2 2023-H1 2024 on an adjusted Ebitda basis. And by 2026, we aim to reach a 4%+ adjusted Ebitda margin, with further upside potential beyond 2026. At the same time, this year it is clear that all three sides of our marketplace in Europe will face headwinds due to inflationary pressures, the removal of economic stimulus and the broader geopolitical and economic impacts of the conflict in Ukraine. We will continue to monitor developments closely. Our 2022 guidance reflects our caution on these factors, but we are confident in our ability to adapt financially to a rapidly changing macroeconomic environment.” The rollout of the group’s Editions kitchens accelerated during the course of 2021, with over 100 kitchens added in the year of which approximately half opened in Q4, bringing brands like Dishoom, Five Guys, Shake Shack and Pho to new neighbourhoods.