Deliveroo Earnings: EBITDA Slightly Ahead; Guidance in Line With Our Expectations

Deliveroo released fiscal 2023 results with gross transaction value up 3%, in line with its fourth-quarter trading update and guidance. Adjusted EBITDA of GBP 85 million was ahead of GBP 60 million-GBP 80 million guidance and our estimate of GBP 72 million in our model. More importantly, free cash flow was negative GBP 38 million, implying second-half cash burn of around GBP 10 million versus GBP 30 million free cash outflow in the first half. Management guided for fiscal 2024 GTV growth in a range of 5%-9% (versus 8% in our model), adjusted EBITDA in a range of GBP 110 million-GBP 130 million (versus GBP 120 million in our model), and free cash flow to be positive for 2024 (versus around GBP 60 million in our model).