The British meal delivery service Deliveroo (ROO.L) stated that it was able to break even in the second half thanks to stricter cost control and that it intended to continue heading in the right way toward profitability in 2023.
Deliveroo shares climbed 6% in early trades to 98 pence from their initial market value of 390 pence when they went public in March 2021.
The business, which benefited from high demand during the pandemic, claimed that in the fourth quarter, the value of orders placed on its platform increased 6% to 1.8 billion pounds ($2.2 billion), offsetting a 2% fall in order volume.
Deliveroo’s founder and CEO Will Shu noted that the company had made “huge improvements in profitability while still delivering growth in a challenging financial climate.”
In a trading update, he stated, “Despite an uncertain picture for 2023, we remain optimistic in our capacity to respond financially and to make more progress on our path to profitability.
The business stated that it anticipated its core earnings margin to be about -1% for the entire year.
The loss-making business, which withdrew from Australia and the Netherlands in 2022, had earlier predicted an earnings margin of between -1.2% and -1.5% for the year.
On Wednesday, rival Just Eat Takeaway.com (TKWY.AS) anticipated higher earnings in 2023 despite seeing a decline in orders in the fourth quarter.
The business, which competes with Uber Eats, claimed that over the year it had improved its market share in important countries like Italy, France, and Britain.