Deliveroo (ROO.L) shares ticked up on Wednesday morning as it reported strong growth in the third quarter of 2021 and upgraded its profit forecast.
Its gross transaction value (GTV) hit £1.6bn ($2.2bn), up 54% year-on-year. It upgraded its full year GTV growth expectations to 60% to 70% growth, whereas earlier it had said it was expecting growth of 50% to 60%.
“While we are mindful of current and potential macroeconomic disruptions and uncertainties, we expect further strong performance in the remainder of the year and we are increasing our full year GTV growth guidance,” said CEO Will Shu.
“We remain excited about the opportunity ahead and our plans to deliver better value to our consumers, help our restaurant and grocery partners to grow, and provide further opportunities for riders”.
Shares were up 3.5% at the time of writing, to trade at 300p. Deliveroo's share price had plunged as much as 30% on its IPO debut on the London Stock Exchange earlier this year.
Shares were priced at 390p but dropped to 331p at the open. They were trading as low as 276p shortly after. The slump had knocked £2bn off the company's value.
Since then, the company has benefited from a year of on-and-off lockdowns in the UK and it seemed the ease of restrictions did not have a significant impact on its bottom line, as Brits continue to order takeaways despite restaurants opening up for dine-in.
Deliveroo’s consumer base continued to grow, with an average of 7.5 million monthly active consumers in Q3 2021, up 56% compared to Q3 2020 and up 142% compared to Q3 2019.
Orders increased by 171%, “demonstrating that growth momentum has been maintained despite the easing of lockdown restrictions in most markets," it said.
In mid-September, Deliveroo launched a partnership with Amazon (AMZN) Prime, allowing all UK and Ireland Amazon Prime members to sign up for free Deliveroo Plus membership for a year, with unlimited free delivery on orders over £25.
Since the launch, the number of Deliveroo Plus subscribers in the region has more than doubled, driven by conversion of existing Deliveroo consumers to Plus as well as bringing new consumers to Deliveroo for the first time.
It also launched a new fast grocery service, Deliveroo Hop, in partnership with Morrisons.
“These are just two examples of innovations introduced this quarter that are consistently improving our consumer value proposition,” said Shu.
At the end of the period, Deliveroo worked with over 143,000 restaurant partner sites globally.
Q3 saw particular challenges for restaurant partners in many markets, the company said, as they contended with a full return of dine-in customers and high demand for delivery, coupled with supply chain issues and labour shortages.