The takeaway group said overall sales growth based on gross transaction value (GTV) fell from 12% in the first quarter to 2% in the quarter to the end of June. “This is a deceleration in GTV value that management believes reflects the impact of increased consumer headwinds,” the company said in a trading update on Monday. In the UK, sales growth fell from 12% to 4% in the quarter. “As the cost of living crisis bites with inflation close to double digits, consumer discretionary spending for services like Deliveroo is under fire as households look for ways to cut spending,” said Victoria Scholar, chief investment officer at Interactive Investor. “There have already been reports that Brits have cut back on streaming services such as Netflix and Disney+, while food delivery businesses such as Deliveroo are likely to face a similar drop in demand.” Deliveroo said it now expects full-year gross transaction value (GTV) growth to be between 4% and 12%, compared to its previous forecast of 15% to 25%. However, the company kept its outlook on underlying margins unchanged. “The company maintains its adjustment [profit] Deliveroo’s margin guidance and balance sheet remain strong,” the company said. “Management is confident in the company’s ability to adapt financially to a rapidly changing macroeconomic environment through gross margin improvements, more efficient marketing spend and tight cost control.” In May, Deliveroo was accused of “seeking approval for exploitative practices” after signing a deal with union GMB that does not ensure its couriers are paid the statutory minimum wage throughout the working day. Subscribe to the Business Today daily email or follow Guardian Business on Twitter @BusinessDesk Under the agreement, which recognizes its 90,000 riders as “self-employed”, the takeaway group has promised to pay them at least the minimum wage after costs, but only when an order is delivered. However, they don’t get paid while they’re checked into the app and waiting for an order, which means their total hourly earnings for the time they’ve spent working may fall below the legal minimum. Shares in Deliveroo, which have fallen more than 70% since its disastrous run on London’s main market last March, fell as much as 5% in early trading on Monday, but later recovered to remain almost flat.
