Deliveroo shareholders could receive their first ever dividend this year as the takeaway business continues to shrink its losses.
The food delivery giant has said it will dish out as much as £250million to shareholders as it rewards their loyalty – despite its beleaguered stock price.
Deliveroo was founded in London in 2013 by Will Shu and Greg Orlowski and went public in 2021 at 390p a share.
The stock has struggled to perform ever since their anticlimactic flotation when major investors, including Aviva, BMO and Legal & General, said they would not be participating, citing concerns over the company’s gig economy-style employment practices.
Divileroo: Deliveroo said it will dish out as much as £250m to shareholders as it rewards their loyalty – despite its beleaguered stock price
But the British tech firm said the shareholder payout would be in the form of either a special dividend, a tender offer or a share buyback, taking the total sum of returns to £300million for this year alone.
Deliveroo shares were up 3.50 per cent to 127.80p on the news.
The update came as Deliveroo revealed it made a loss of £83million in the first half of the year, down from £153.8million in 2022, while revenues surpassed the £1billion mark thanks to higher advertising income.
Deliveroo now expects pre-tax profits of £60million-£80million for the full year, up from a previous forecast of £20million to £50million.
Analysts at Bernstein said Deliveroo’s improved forecast was a ‘big positive for the stock and the sector’.
Deliveroo has set its sights on profitability – cutting its workforce by 9pc earlier this year and scaling back operations in some markets, including exiting Australia.
The UK and Ireland were a success for Deliveroo in the half year, where sales grew by 11pc to £601.9million, thanks to soaring food prices and people spending more on their orders when they treat themselves.
‘I am very pleased with our progress so far this year. We have delivered a strong financial performance despite challenging macroeconomic conditions,’ said Will Shu.
Adam Vettese, an analyst at investment platform eToro, said: ‘There had been a lot of scepticism about Deliveroo and its business model, and those investors who backed it when it went public have taken a bath on their investments.
‘But this is a promising set of results. For now, the firm is dealing with choppy economic waters fairly well.’
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