Deliveroo — FY2021 Earnings Presentation
45 slides from Deliveroo's earnings presentation, Mar 17, 2022
Slide 1: Deliveroo FY 2021 Results presentation
Deliveroo FY 2021 Results presentation 17 March 2022 1
Slide 2: Definitions & Basis of Discussion
Definitions & Basis of Discussion The following commentary includes discussion of statutory measures such as revenue and cash and cash equivalents, as well as alternative performance measures (APMs) such as gross transaction value (GTV), gross profit margin (as % of GTV) and adjusted EBITDA, as the bu
Slide 3: Contents
Contents 1. Overview 2. Business highlights 3. Financial performance 4. Path to profitability 5. Guidance 3
Slide 4: Overview | Key takeaways
Overview | Key takeaways 1 Strong year of growth, with full year Gross Transaction Value (GTV) up 70% YoY 2 Continued progress with Plus, Editions and Grocery 3 Robust financial position with £1.3 billion in cash & cash equivalents at 31 Dec 2021 2022 guidance: GTV growth in the range of 15–25% (at c
Slide 5: Overview | Relentless focus on all sides of our marketplace
Overview | Relentless focus on all sides of our marketplace Highly engaged marketplace 2021 financial performance Consumers: 8.0 million average monthly active Orders: 301m +73% YoY consumers in Q4 20211 Riders: +70% 85% global rider satisfaction2 across our GTV: £6.6bn YoY network of >180,000 riders
Slide 6: Contents
Contents 1. Overview 2. Business highlights 3. Financial performance 4. Path to profitability 5. Guidance 6
Slide 7: UKI | Strong growth and continued market share gains
UKI | Strong growth and continued market share gains with seeds planted for future growth Segment Orders GTV Gross Profit Adjusted EBITDA m £m £m £m 72% 71% 9.3% 2.6% ● Continued to grow UK market share in a competitive 3,570 environment, with UKI orders 330 and GTV up 72% and 71% YoY, respectively ●
Slide 8: International | Continued growth while improving consumer value proposition
International | Continued growth while improving broader consumer value proposition Segment Orders GTV Gross Profit Adjusted EBITDA m £m £m £m 74% 69% 5.5% (1.8)% ● Strengthened our position across major cities in key 3,061 markets such as Marseille and Rome ● Continued roll-out with key grocery part
Slide 9: Plus | Increased order frequency across Plus programmes
Plus | Increased order frequency across Plus programmes contributes to higher lifetime value versus PAYG1 ● Continued traction in Plus GOLD subscription programme ● Launched Silver tier designed for Average order frequency families in Q1 2021 SILVER ● 3x increase in Plus subscribers globally, with U
Slide 10: Editions | Accelerated rollout of delivery-only kitchens
Editions | Accelerated rollout of Editions, opening over 100 delivery-only kitchens in 2021 ● More than 300 kitchens 300+ globally, with over 100 kitchens opened in 2021 Number of Editions kitchens ● Accelerated rollout throughout the year, with nearly 70 kitchens opened in H2 ● Bringing brands like
Slide 11: On-demand grocery | Launched new partnerships
On-demand grocery | Launched exciting new partnerships whilst increasing grocery share of total GTV to 8% On demand grocery GTV % of total 2021: sustained growth through ● Increased partner grocery sites expansion from ~7,000 at end-2020 to over 11,000 at end-2021 H1 20: initial spike as lockdown ●
Slide 12: On-demand grocery | Enhancing consumer app and experience
On-demand grocery | Enhancing consumer app and experience 12
Slide 13: On-demand grocery | Partner app and operational improvements
On-demand grocery | Partner app and operational improvements strengthening proposition 13
Slide 14: Rider proposition | Flexible model is highly attractive to riders
Rider proposition | Deliveroo’s flexible model is highly attractive to riders Total UK job vacancies1 vs. Deliveroo’s monthly active riders2 in the UK in 2021 000s Deliveroo’s rider retention3 stable ● Despite huge increase in throughout 2021 employment vacancies, there Deliveroo’s remains high deman
Slide 15: Rider status | Key updates
Rider status | Key updates UK EU France Italy LEGAL POLITICAL POLITICAL LEGAL ● June 2021: UK Court of ● Dec 2021: European Union ● Jul 2021: French ● Dec 2021: Settled historic, Appeal confirmed for 4th proposals on platform Government introduced sector-wide H&S time that Deliveroo riders broadly in
Slide 16: Contents
Contents 1. Overview 2. Business highlights 3. Financial performance 4. Path to profitability 5. Guidance 16
Slide 17: Group | Strong year-on-year growth in both geographic segments
Group | Strong year-on-year growth in both geographic segments Average monthly active consumers1 Orders GTV m, global m, global £m, global 73% 70% 64% 74% 69% 64% International 64% 72% 71% UKI x% Year-on-year growth Continuing operations; GTV growth rates are shown at constant currency. Note: (1) MA
Slide 18: Group | Investments above gross profit to support future growth
Group | Investments above gross profit to support future growth UK&I gross profit International gross profit Group gross profit £m £m £m 11.1% 9.9% 9.4% 9.1% 6.5% 7.2% 6.1% 4.8% 8.9% 8.7% 7.8% 7.2% ● Step up in investments above gross profit to support future growth, e.g. selection and new consumer acqui
Slide 19: Group | Increased investments to build long-term value
Group | Increased investments to build long-term value Marketing and overheads Marketing and overheads £m half year £m full year 10.9% 7.7% 8.8% 10.2% 9.0% 9.5% ● Increased investments to build long-term value, including in our engineering team, acquiring new consumers and building our brand equity
Slide 20: Group | Higher adjusted EBITDA loss reflects investments
Group | Higher adjusted EBITDA loss reflects investments to drive future growth and reversal of COVID lockdown benefits Adjusted EBITDA Adjusted EBITDA £m half year £m full year (1.6%) 0.7% (0.8%) (3.2%) (0.3%) (2.0%) ● Higher aggregate gross profit more than offset by increased investments in marketin
Slide 21: Group | Healthy balance sheet and liquidity
Group | Healthy balance sheet and liquidity Cash and cash equivalents £m ● We remain well-capitalised with £1.3bn of cash and cash equivalents, plus the ability to draw on an RCF if we choose ● H2 change in net working capital Includes £132m (NWC) includes expected unwind positive impact Includes £(
Slide 22: Group GTV by Cohort | Cohort behaviour remains attractive
Group GTV by Cohort | Cohort behaviour remains attractive and predictable GTV by cohort Adding GTV from ● Each consumer cohort has new consistently increased the consumers amount it spends on our platform in subsequent years ● Net GTV retention of more than Growing 100% every year GTV like-for-like
Slide 23: UK cohort behaviour | Increasing order frequency by cohort
UK cohort behaviour | Trend of increasing order frequency by cohort has continued since reopening Q4 Q4 Q4 Q4 Q4 Q4 Period: 2016 2017 2018 2019 2020 2021 Cohort: Monthly Average Order Frequency (of MACs) ● Pre-pandemic trend was for annual cohorts to increase 2015 2.9x 3.2x 3.9x 4.1x 5.1x 5.4x avera
Slide 24: UAE cohort behaviour | Highest order frequency market
UAE cohort behaviour | Highest order frequency market with more mature cohorts now ordering over 10x per month Q4 Q4 Q4 Q4 Q4 Q4 Period: 2016 2017 2018 2019 2020 2021 Cohort: Monthly Average Order Frequency (of MACs) ● UAE is our most mature market in terms of AOF 2015 6.2x 6.7x 7.8x 8.7x 10.0x 10.3
Slide 25: Contents
Contents 1. Overview 2. Business highlights 3. Financial performance 4. Path to profitability 5. Guidance 25
Slide 26: Path to profitability | Adjusted EBITDA margin guidance
Path to profitability | Adjusted EBITDA margin guidance over the short, medium and long term 2021 2022 Medium- Longer- Actual Guidance term term Adjusted Aim to reach Aim to reach EBITDA breakeven at 4%+ by 2026 (2.0)% (1.5)% - (1.8)% margin some point during Further upside % of GTV H2 2023 - H1 2024
Slide 27: Path to profitability | Overview
Path to profitability | Overview 1. Path and levers to 2026 adjusted EBITDA guidance 2. Path to reach breakeven at some point during H2 2023 - H1 2024 3. Existing market profitability proof points 4. Hyperlocal profitability examples 27
Slide 28: Path to profitability | Timeline of path to adjusted EBITDA profitability
Path to profitability | Timeline of path to adjusted EBITDA profitability Adjusted EBITDA margin (% of GTV) Further upside 2018-2021: actuals potential 2022 onwards: guidance 4%+ 0.7% H2 2023 - 2018 2019 2020 2021 2022 H1 2024 Reach 2026 Beyond (0.3)% (0.8)% breakeven 2026 during period (1.6)% (2.0)%
Slide 29: Path to profitability | Illustrative pathway and levers
Path to profitability | Illustrative example of potential pathway and levers % of GTV Key Components Levers 2021 2026 bps chg Commission, consumer, and Revenue levers Revenue 27.5 % advertising revenue; refunds ● Increase AOV (eg by upselling) ● Optimise consumer pricing Cost of sales (20.0)% Deliver
Slide 30: Path to breakeven | Half-on-half improvement in 2022
Path to breakeven | Expect half-on-half improvement in H1 & H2 2022 0.7% H2 H1 2020 2021 2022 2023 2024 H1 H2 H1 H2 H1 H2 (0.3)% Reach breakeven during period (0.8)% Key levers: (1.5)% - Advertising revenue (1.8)% - Continued optimisation of (1.6)% consumer fees (2.0)% - Network efficiencies driven by
Slide 31: Path to profitability | Fully-allocated profitability in key markets
Path to profitability | Already achieved fully-allocated adjusted EBITDA profitability in key markets UKI % of GTV UAE % of GTV % of GTV 2020 2021 2020 2021 ● Key markets have achieved positive adjusted EBITDA Gross Profit 10.4 % 9.3 % > 10 % > 10 % margins both pre- and post- allocation of Group costs
Slide 32: Path to profitability | Gross profit margins across UKI towns and cities
Path to profitability | Strong gross profit margins across multiple types of town/city in UKI - with plenty of opportunities too UKI, Q4 2021 London Brighton / Operational Harrogate Town/City Town/City Location gross profit Type1 margin2 Operational gross profit margin2 % Sheffield Small Sevenoaks South 1
Slide 33: Path to profitability | Gross profit margins across International towns and cities
Path to profitability | Solid gross profit margins across multiple types of town/city across International markets - with plenty of opportunities too International3, Q4 2021 Milan Operational Town/City Town/City Location gross profit Type1 Operational gross profit margin2 % Paris margin2 Bordeaux Large
Slide 34: Contents
Contents 1. Overview 2. Business highlights 3. Financial update 4. Path to profitability 5. Guidance 34
Slide 35: Guidance | For 2022 and beyond
Guidance | For 2022 and beyond 2021 2022 Medium- Longer- Actual Guidance term term 15% - 25%* GTV 70%* H2 growth rate 20 - 25%* p.a. above H1 Aim to reach Aim to reach Adjusted 4%+ by 2026 breakeven at EBITDA margin (2.0)% (1.5)% - (1.8)% some point during Further upside % of GTV H2 2023 - H1 2024 b
Slide 36: Summary | Key takeaways
Summary | Key takeaways 1 Strong year of growth, with full year Gross Transaction Value (GTV) up 70% YoY 2 Continued progress with Plus, Editions and Grocery 3 Robust financial position with £1.3 billion in cash & cash equivalents at 31 Dec 2021 2022 guidance: GTV growth in the range of 15–25% (at co
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Slide 38: Appendix
Appendix 38
Slide 39: Overview | 2021 performance vs. guidance
Overview | 2021 performance vs. guidance Original Q3 revised 2021 2021 2021 Guidance1 Guidance2 Actual GTV growth 30-40% 60-70% 70% ✓ Gross profit 7.5-8.0% 7.5-7.75% 7.5% ✓ % GTV GTV growth rate shown at constant currency. Notes: (1) Given in March 2021 (2) Initially updated GTV growth to 50-60% and
Slide 40: Group | Q4 sequential growth in orders and GTV
Group | Q4 sequential growth in orders and GTV of 10% and 11%, respectively Orders GTV m, global 176% 171% 176% 154% £m, global 199% 184% 178% 159% 66% 78% 116% 90% 66% 42% 75% 91% 133% 82% 59% 36% x% Year-on-year growth x% ‘21 vs ‘19 growth GTV growth rates are shown at constant currency. 40
Slide 41: Group | GTV per order has stabilised in the second half
Group | GTV per order has stabilised in the second half, having reverted towards pre-pandemic levels GTV per order GTV per order £, global £, global 8% (4)% (4)% (5)% x% Year-on-year growth GTV per order growth rates are shown at constant currency. 41
Slide 42: Group | Growth driven by increase in monthly active consumers
Group | Growth continues to be driven by consistent year-on-year increase in average monthly active consumers Average monthly active consumers Average monthly order frequency m, global #, global 148% 148% 141% 123% 52% 63% 95% 82% 59% 37% x% Year-on-year growth x% ‘21 vs ‘19 growth 42
Slide 43: UK & Ireland | Continued market share gains
UK & Ireland | Continued market share gains and expanded population coverage Orders GTV Highlights m 170% 184% 182% 157% £m 209% 212% 193% 168% ● Continued market share gains 78% 82% 121% 94% 59% 41% 89% 98% 142% 87% 56% 36% throughout Q4 ● Expanded population coverage to 77% ● Growth initiatives: ○
Slide 44: International | Strengthened market positions
International | Strengthened market positions and further rollout of grocery and Editions Orders GTV Highlights m 181% 160% 171% 151% £m 189% 158% 162% 150% ● Continued to strengthen position 56% 75% 112% 86% 73% 43% 61% 84% 125% 77% 63% 36% across key cities in major markets (e.g. Toulouse, Lille a
Slide 45: Financial KPIs (excluding Spain)
Financial KPIs (excluding Spain) £m Q1 20 Q2 20 H1 20 Q3 20 Q4 20 FY 2020 Q1 21 Q2 21 H1 21 Q3 21 Q4 21 FY 2021 Group Orders (m) 32 40 73 44 57 174 70 77 146 74 81 301 % year-over-year - - - - - - 116% 90% 102% 66% 42% 73% GTV 695 965 1,660 1,012 1,307 3,979 1,616 1,709 3,325 1,572 1,733 6,631 % yea