MakeMyTrip Q2 revenue climbs 25%, loss narrows on cost controls

MakeMyTrip Ltd, the country's largest online travel services provider, reported higher revenue and a narrower loss for the second quarter of the financial year 2018-19 thanks to growth in key businesses.

Adjusted revenue for the quarter ended September surged 25.3% in constant currency terms to $160.1 million from $139.2 million a year earlier, the Nasdaq-listed company said in a filing with the US Securities and Exchange Commission.

The company evaluates its financial performance based on adjusted revenue. This represents International Financial Reporting Standards revenue after adding back expenses for acquiring customers and promoting transactions across various booking platforms, it said. 

Adjusted operating loss shrank to $25.37 million from $32.79 million. Adjusted net loss, which takes into account share-based compensation costs of employees, income tax and other things, narrowed to $32.39 million from $45.18 million.

“The MakeMyTrip Group continued to improve upon its strong operating and financial performance during the quarter with significant reduction in losses,” said Deep Kalra, group chairman and group chief executive officer at MakeMyTrip.

The company’s adjusted revenue from the air ticketing business increased almost 31% in constant currency to $56.5 million from $47.1 million a year earlier. Revenue from the hotels and packages business, the biggest contributor to total revenue, climbed about 18% to $85.5 million.

It has also started reporting revenue from its bus ticketing segment since the last quarter; this was earlier clubbed with other small businesses. Adjusted revnue from bus ticketing grew 37.4% in constant currency to $12.1 million from $9.6 million a year earlier.

MakeMyTrip, which competes with the likes of Yatra and Cleartrip, said it has adopted a new method to calculate revenue whereby it will deduct upfront certain customer acquisition costs and other marketing and promotional expenses.

Overall marketing and sales promotional expenses fell 61.4% to $44.8 million. However, after including the promotion expenses recorded as a reduction of revenue, marketing and sales promotion costs decreased 1.6% to $133.7 million. Staff costs fell 0.9% to $28.7 million.