On-demand food delivery service Deliveroo made a loss of £129m in 2016 – up from £30m in 2015 – as it shelled out for marketing and worldwide expansion costs.
Revenue for the brand was up 611% to £128.6m for the year end 31 December 2016 compared to £18.1m in 2015 showing increased popularity with customers; however the cost of getting the food to the customer was so high that the company only made a gross profit of just £1.1m.
During the year, it made an operating loss of £141m (2015: £30.2m) and an overall loss before tax of £129.1m. The report showed an exceptional cost of £5.3m which is how much it cost Deliveroo to rebrand last year – including writing off old branded equipment and design costs.
The number of drivers also rose worldwide from 5,700 in 2015 to 26,000 last year which saw administration expenses rise to £142m in 2016.
The group raised £208m from shareholders in 2016, enabling it to expand and implement new technologies. It spent £14.1m on leasehold improvements, driver and restaurant equipment and IT and office equipment during the year, £10m more than what was spent in January 2016.
Intangible assets such as internally developed and acquired software cost the company £7.2m.
Most of the growth came from international expansion. By the end of 2016 Deliveroo operated in 25,000 restaurants in more than 120 cities across 12 countries.
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