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Mon 1st Oct 2018 - Deliveroo reports sales grow 116% to £277m but losses increase, now working with 50,000 restaurants
Deliveroo reports sales grow 116% to £277m but losses increase following year of major investments, now working with 50,000 restaurants: Deliveroo has reported sales grew 116% to £277m for the year ending 31 December 2017, compared with £128.5m the previous year. Gross profit increased to £64.3m, compared with £1.1m the year before, while gross margin has gone from less than 1% to 23%. In 2017, loss before tax increased to £184.7m, compared with £129.1m the year before following a year of major investments. Deliveroo said the revenue growth in 2017 outstrips that of the increase in net loss, underlining Deliveroo’s growing profit margin. This can be attributed to growing maturity in existing markets, improved services and growing order volumes. The company also revealed it is now working with 50,000 restaurants and 50,000 riders across the world. In 2017, Deliveroo’s European markets saw 99% year-on-year revenue growth, while all other markets saw 207% year-on-year growth. In 2017 Deliveroo invested heavily, increasing operational expenses by 73% and investing £106m more than in 2016. In the year to 31 December 2017, net assets also increased 120% to £372m (2016: £169m). Investment has continued in 2018 and the company has continued to grow. Deliveroo will move into its 13th market, Taiwan, in the coming weeks and expects to move into more new markets in the coming months. In 2017, Deliveroo launched in its 200th city – Orléans in France. The company now operates in 500 towns and cities worldwide. Deliveroo recruited 300 engineers while it moved into its new Cannon Street head office in London. Deliveroo acquired US-based technology company Maple for £11m to help restaurants “improve efficiency and drive growth”. The business rolled out late-night deliveries and launched Deliveroo Plus, a subscription service that gives customers unlimited free deliveries, which is now being rolled out globally. The first Deliveroo Editions kitchen opened in London in April 2017. Further sites have now opened in France, the Netherlands, Singapore, Australia, Dubai and Hong Kong. By the end of this year, Deliveroo will have 250 kitchens worldwide. The company said its success had in turn driven growth in partner restaurants. Analysis by Capital Economics published in 2017 found Deliveroo helped create 7,200 jobs across the restaurant industry since launching in the UK in 2013, and increased revenues of restaurants and their wider supply chain by £460m. It also revealed Deliveroo’s operations helped to add £372m in value to the UK economy in the 12 months to June 2017. In 2017 Deliveroo raised almost $500m. The last Series F round turned Deliveroo into one of only a handful of UK-domiciled “unicorns”, which have a valuation of more than $1bn (£770m) with a valuation in excess of $2bn. Deliveroo revealed the top dishes ordered in 2017 include Le Big Fernand from Big Fernand in Lille, burritos from Dublin’s Boojum and Five Guys’ cheeseburger in London. 2017 also saw the growing popularity of Hawaiian poké bowls, while buddha bowls were also a big hit. The company’s growth and investment in innovation has continued in 2018. Marketplace+ was launched to enable restaurants to use their own fleets and Deliveroo riders, extending restaurants’ delivery services. Deliveroo invested £10m in offering all riders free accident and injury and third-party liability insurance. Deliveroo has changed its app to be more environmentally friendly, with cutlery no longer coming with every order, reducing the use of plastic. Deliveroo has also announced an integration with Google Maps across ten countries throughout Europe and the Asia-Pacific regions. Deliveroo co-founder and chief executive Will Shu said: “Deliveroo is growing rapidly around the world, driven by our passion to bring amazing food to people whenever and wherever they want it. Our growth is matched only by our ambition. We want to become the world’s definitive food company and we have invested heavily in innovation, technology, people and restaurants. We are changing the way people eat and helping restaurants to expand to new areas and in new ways. I am proud Deliveroo now works with 50,000 restaurant partners and 50,000 riders worldwide, as well as our millions of fantastic customers. I’m looking forward to expanding even further with them in the years to come.”

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