The decrease in pandemic restrictions and a sudden rise in the cost of living have dented the growth of the British food delivery firm, Deliveroo. It reported a pretax loss of £147.3 million or $178 million. The losses were a result of increased spending on marketing and overheads.
Revenue climbed 12%, which was very slow compared to the first half of 2021. In addition, the Gross Transaction value grew by 7%, which was extremely slow. Challenging market conditions led to these losses as per the company.
Food delivery firm Deliveroo said that it’s planning to exit the Netherlands. It had left Spain last year and excited Germany in 2019.
Shares of the firm climbed 3% when the food delivery firm changed its goal for 2022 GTV growth from 4%-12%. This is quite less than the previous range of 15%-25%.
CEO of the food delivery firm Will Shu recently said, “So far in 2022, we have made good progress delivering on our profitability plan, despite increased consumer headwinds and slowing growth during the period,”
CEO Will Shu said that they are confident that they will adapt to any new financial change in their prospective environment. He reinstated that they are confident enough that they will register profits in H2 2022.
Food delivery firm, Deliveroo will now begin its first-ever stock buyback program. £75 million worth of shares will be brought back from investors in this massive change. The company said that it wants to mitigate dilution from share-based compensation plans, which explains the purpose behind this buyback program.
Food delivery firm, Deliveroo announced that the CEO of UK-bathe sed clothing retailer Next, Simon Wolfson, will step down from the board of directors. He mentioned that time required for his role at Deliveroo is now not compatible with his other commitments.
Deliveroo has recently added McDonald’s to its platform. The firm has also signed up non-food retailers such as WH Smith and LloydsPharmacy. The firm believes that this move will improve its growth rate and propel it to new heights.