Trading On margin

Deliveroo PLC negotiates ahead of expectations but warns of pressure on margins

The full-year forecast for growth in gross transaction volumes has been raised, but the company also revealed that the gross profit margin will be in the lower half of the expected range.

() improved its forecast for the full year after trading ahead of expectations in the second quarter.

Gross Transaction Value (GTV), or the amount of money that goes through the Deliveroo system, increased 76% year-on-year in the second quarter of 2021 to reach £ 1,739 million and increased 81% in foreign currency constant.

GTV in the UK and Ireland rose 87% from the previous year to £ 921million.

The number of orders taken was 88% higher than a year ago at 78 million, with orders from the UK and Ireland up 94% to 38 million.

The controversial fast food delivery group has said it now expects GTV in 2021 to be up between 50% and 60% from 2020, having previously issued a guidance range of 30% to 40. %.

However, GTV’s full-year gross profit margin is expected to be in the lower half of the group’s forecast range, with Deliveroo saying it expects order volume to return to pre-market levels. pandemic. The group, which floated less than successfully in April, said it sees an opportunity to make further discretionary investments in growth opportunities in the second half of the year. Due to the acceleration of these investments in the second half of the year, margins are also expected to suffer a shock.

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