The ELIVEROO stock had another skid today after the company admitted that the end of the blockade would hurt growth – but I don’t know how much it is.
Will Shu, CEO, was widely panned two weeks ago and was the first update since the somewhat embarrassing stock market turmoil, with sales up 114% in the three months to March. He said it was £ 1.65 billion.
There were 71 million orders as the blockade dominated the country. However, with the reopening of pubs and restaurants, consumers may be more enthusiastic about going out than staying.
The memo to the city added: “We continue to operate in an uncertain environment as it remains unclear when and the implications of these restrictions being lifted in the coming weeks and months. Deliveroo will grow as the blockade eases. Is expected to slow down, but the degree of slowdown remains uncertain. “
It didn’t help emotions, and the stock that was floating at 390p went down another 3p to 266p.
The company has been accused of exceeding its promise, seeking too high a valuation for its continuingly losing business. Goldman Sachs and JP Morgan, who led the floats, have been criticized, but bank charges can ease embarrassment.
Shu is also in dire straits over a dual-share structure that gives him far more voting rights than his stock, and the business now accounts for more than 60% of the UK’s population, with an additional 6 million people recently. It states that it is increasing.
He states: “We are operating in 12 markets, all in different regulatory stages, so we were able to monitor people’s behavior. In Hong Kong, all blockade restrictions were lifted and people enjoyed their meals. Yes, but we still see really resilient growth.
“The truth is that we don’t know what will happen in the UK and how long these new consumer behaviors will last, but we are really positive.”
The company “is taking a cautious approach to year-round guidance,” suggesting that it may not be able to reach its goals.
Deliveroo seems to be at least London’s market leader, ahead of rival Just Eat.
Deliveroo claims that riders demand flexibility, but concerns about the rights of workers have also hurt the business somewhat.
“Deliveroo works with more than 100,000 riders worldwide. In the UK, as of the end of the first quarter of 2021, rider satisfaction reached a record 89%.”
Deliveroo admits that the end of the blockade could hurt growth
Source link Deliveroo admits that the end of the blockade could hurt growth