Food delivery company Deliveroo has slashed its full-year revenue guidance, blaming a worsening economic outlook as pressures on consumers mount.
The group said its full-year gross transaction value (GTV) growth was now expected to be in the range of 4% to 12% at constant currency levels, compared to previous guidance of 15% to 25%.
Deliveroo said second quarter GTV growth slowed to 2% from 12% in the first quarter.
It said this reflected "the impact of increased consumer headwinds" during the second quarter.
For the first half of the year, gross transaction value totalled £3.56 billion (€4.19 billion), which the company said was a 7% increase year-on-year (+7% at constant currency levels).
Cost Of Living
Confidence levels among Britain's consumers sank to a record low last month as they struggle with the accelerating cost of living. Wages are failing to keep pace with inflation that hit a more than 40-year high of 9.1% in May and is heading for double digits.
Deliveroo said second quarter growth in orders was 3% year-on-year, while GTV per order fell slightly year on year, as basket sizes were higher during COVID-19 lockdowns for part of the same quarter last year.
The group maintained its margin guidance for the year.
EBITDA Margin Expectations
Deliveroo, which recently appointed a new CFO, continues to expect 2022 adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) margin to fall 1.5% to 1.8%, compared with a fall of 2.0% in 2021.
'Management is confident in the company's ability to adapt financially to a rapidly changing macroeconomic environment, through gross margin improvements, more efficient marketing expenditure and tight cost control,' it said.