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Summary
- The crisis helped the food delivery business flourish, with everyday growing demand.
- Deliveroo’s group orders shoot up 114 per cent to £71 million as compared to first quarter last year.
- Just Eat Takeaway.com’s first quarter orders grew 79 per cent from the similar period of the last year.
The pandemic’s impact might have been devastating for a majority of industries, but for few others, it brought some cheers as well. The food delivery industry was one among the few which benefited due to the unprecedented situation. Suddenly there was a spurt in Google searches for home delivery; all kind of essential or non-essential businesses started looking for home delivery options; surge was not only limited to food and groceries only. The crisis helped the food delivery business flourish, with everyday growing demand. The development was clearly visible on the results of delivery services business. In this article we will discuss the performance of two prominent listed companies Deliveroo and Just Eat Takeaway.
Food delivery company Deliveroo released its trading update for the first quarter (Q1 2021) on 15 April. Quoting that the growth accelerated for the fourth consecutive quarter, the company statement said that the group orders shot up by 114 per cent to £71 million for Q1 2021 (Q1 2020: £33 million).
In a similar trend, this year’s first quarter orders for Just Eat Takeaway.com jumped 79 per cent to 200 million, which was almost double its forecast growth rate. The primary reason for the boom in ‘eating at home’ was the restrictions related to the coronavirus pandemic in the UK and other markets.
Also Read: Deliveroo Share Shows Brief Spurt as Retail Investors Begin to Trade
Highlights of Deliveroo’s trading update
Deliveroo’s trading update:
- Driven by the addition of new customers, orders for the UKI segment (UK and Ireland) rose 121 per cent to £34 million for Q1 2021. The segment’s GTV (Gross Transaction Value) rose 142 per cent to £852 million for Q1 2021.
- The company’s international segment has also displayed remarkable overall GTV growth. GTV grew by 119 per cent and orders by 108 per cent to £794 million and 37 million respectively for the first quarter of this year.
- Mindful of the uncertain consumers’ behavioural impact on lifting up of coronavirus related restrictions, the company maintained its guidance for the full year FY 2021’s growth in GTV in the range of 30 per cent to 40 per cent and for gross profit margins between 7.5 to 8.0 per cent.
- The firm’s overall GTV jumped 130 per cent to £1647 million for the quarter (Q1 2020: £352 million).
UK and Ireland, along with the international markets, saw record growth in new customers with sustained demand from existing ones, said Will Shu, the firm’s chief executive. The food delivery company said that its growth is likely to slow down as the coronavirus restrictions eased.
Deliveroo shares (LON:ROO) were down 3.74 per cent to GBX 260.10 on 15 April at 1.47 PM.
Also Read: Did Just Eat Takeaway Register a Decisive Break Out on Upside?
Just Eat Takeaway.com
Highlights of the Q1 2021 trading update for the food delivery firm are as follows:
- The company’s fastest growing segment was the UK region. The UK Delivery network delivered an impressive 695 per cent order growth rate for Q1 2021 year-on-year.
- Just Eat UK processed 64 million orders for 2021, up 96 per cent compared with Q1 2020.
- Order growth in Germany was 77 per cent, and that in the Netherlands was 53 per cent for the first quarter of this year.
- The company’s Gross Merchandise Value was up 89 per cent to reach a value of €4.5 billion for the first quarter of 2021.
The shares of Just Eat Takeaway.com N.V. (LON: JET) were up 0.09 per cent to GBX 7911.00 on 15 April at 1.47 PM.
