Deliveroo reduces sales growth targets as customers cut back orders

However, the company said earnings are set to be better than previously predicted and saw shares lift higher as a result.

Deliveroo has seen losses widen as it pumps more cash into its rapid growth plans (Mikael Buck/Deliveroo/PA)

Takeaway delivery specialist Deliveroo has warned that sales growth will be at the bottom end of targets after order numbers were impacted by UK households tightening their belts.

Despite this, the company said earnings are set to be better than previously predicted and saw shares lift higher as a result.

It came as Deliveroo revealed that gross transaction value increased by 8% over three months to September, compared with the same period last year.

Trade was boosted by larger value transactions as the company witnessed a 1% fall in orders over the quarter.

However, the firm said transaction value for 2022 as a whole will see growth between 4% and 8%, having previously guided that it could increase by as much as 12%.

In the latest quarter, Deliveroo’s UK & Ireland business outperformed its international operations with 11% growth year-on-year.

The company said it has benefited from its continued expansion which saw the rollout of more than 1,000 McDonald’s sites to its service in the UK, as well as the expansion of its partnership with Boots to 125 stores.

Will Shu, founder and chief executive officer, said: “During the quarter we delivered continued gross transaction value growth year-on-year, strengthened our value proposition and made further progress on our path to profitability.

“Since June, the year-on-year growth trend has been broadly stable, despite the ongoing economic uncertainty.

“Throughout 2022 we have been adapting financially to the operating environment and driving forward on our path to profitability, and we now expect the H2 2022 adjusted earnings margin to be better than our previous guidance.

“We continue to be excited about the opportunity ahead and our ability to capitalise on it.”

Shares in the company moved 4.5% to 85.6p on Friday morning.