Gurugram and New York-headquartered online travel company MakeMyTrip has announced its performance for the quarter and the year ending March 31, 2019. In its last quarter, MakeMyTrip raked in $120.17 Mn in revenue taking the yearly revenue to $486.01 Mn.
The company’s unaudited financial results show that the losses for Q4 increased 39% to $40.39 Mn, as against $29 Mn in Q3. The loss for the year was reported at $167.88 Mn overall. On a Y-o-Y basis, the FY19 losses have improved considerably by 23.7% as against $220.24 Mn in the previous year.
Deep Kalra, group chairman and group CEO said, “The execution of our strategies has allowed us to improve on our market share and drive strong growth rates across gross bookings, adjusted revenue and standalone hotels online room nights. We also improved marketing and promotional spend efficiencies to reduce our operating losses meaningfully for the full fiscal year.”
Founded in 2000 by Deep Kalra, MakeMyTrip functions as an online travel aggregator. Its services include air ticketing, hotel and alternative accommodations bookings, holiday planning and packaging, rail ticketing, bus ticketing, car hire and ancillary travel requirements such as facilitating access to third-party travel insurance and visa processing. On August 17, 2010, MakeMyTrip Limited was listed on the NASDAQ after its initial public offering at $14 per share.
MakeMyTrip: Key Performance Metrics For Q4
In terms of revenue, the company has reported operational losses of $30.98 Mn, a 25.6% improvement from the Q4 2018 performance.
Further, in terms of operational metrics, the quarterly gross bookings reached $1.37 Bn, a 16% Y-o-Y increase. As part of this, air, hotels and bus ticketing segment had considerable performance:
Also, for this quarter, marketing and sales promotion expenses decreased by 55.6% to $41.7 Mn in the quarter ended March 31, 2019. Personnel expenses decreased marginally by 0.7% to $28.2 Mn in the Q4.
MakeMyTrip: Key Performance Metrics For FY19
In terms of yearly performance, as a result of the foregoing factors, operating activities resulted in a loss of $152.9 Mn in the year ended March 31, 2019. This is against $219.4 Mn in the year ended March 31, 2018.
The company’s net finance cost was $4.9 Mn in FY19, primarily due to the higher net foreign exchange losses in the year ended March 31, 2019. The company said this was a result of the depreciation of the Indian Rupee against the US dollar as compared to the year ended March 31, 2018.
In the FY19, marketing and sales promotion expenses decreased by 57.5% to $192.1 Mn from $451.8 Mn in FY18. In terms of marketing spending as a percentage of gross bookings, it is below 10%.
What Does The Performance Indicate?
The first response to the company’s financial results came with a jump in the opening stock in the market on May 16 at 25.40. With a volatile day in the stock market, the stock closed at 23.45.
In the past few years, the MMYT stock has been known to miss Wall Street’s earnings projections. The company missed 50% of the time and was never able to meet predictions and topped expectations six times. And the trend of topping predictions has continued for the year.
In the company’s earnings call, Deep Kalra said the company is focusing on trying to persuade its current customers to use its brands to more than book the occasional flight and hotel with a mix of new products, credit card programs, and loyalty programs.
Further in the light of Naspers selling its stake to Ctrip, MakeMyTrip is anticipating more strategic cooperation with Ctrip after regulators okay the deal. A report by Praxis Global said that online travel market in India, led by flight and hotel aggregators, is expected to touch $13.6 Bn by 2021, and will account for almost 43% of the total travel category in the country.
[This is a part of the What The Financials (WTF) series launched by Inc42 Datalabs. We would be exploring the financial health of Startups and discuss its key metrics of growth, to read more articles click here.]