Yatra posts marginal increase in revenue as travel restrictions ease

NASDAQ-listed travel portal Yatra Online has registered a marginal uptick in revenues as travel activity across the world begins to pick up pace after months of widespread restrictions. Yatra’s overall revenue improved to $3.5 million in the three months ended September 30, 2020 from $2.5 million it generated in the previous quarter. 

On a year-on-year basis, it marks a decrease of 85% compared to 91.5% decrease last quarter.

The Gurugram-based company’s losses stood at about $4.1 million for the second quarter of the financial year 2020-21 compared to around $1 million in the previous quarter, Yatra said in a filing to the SEC (Securities and Exchange Commission).

“The domestic aviation market in  India continued on its path of recovery with  October  2020  passenger traffic up  33%  from  September  2020  levels have recovered to 42% of October 2019 levels.  This recovery in domestic travel led to a sequential quarterly growth of 60% in our adjusted revenue to $5.1 million. This growth in revenue further combined with strong cost control enabled us to reduce our adjusted  EBITDA  loss  sequentially from $4.1 million in the June 2020 quarter to $1.7 million in the September 2020 quarter,” Dhruv Shringi, co-founder and CEO, said.

Adjusted revenue is sum after deducting service costs and adding back expenses related to consumer promotions and loyalty program costs.

Air ticket sales grew to $3.4 million in the second quarter from $2.2 million in the previous three month period, though it still marks a 75.4% decrease year-on-year. Income from hotels and packages booking stood at $619,000, up from 158,000 in the first quarter.

“We continue to believe our current liquidity position and cost restructuring efforts provides us with enough capital to withstand a prolonged slowdown in the travel industry should that occur,” Shringi said.

Yatra’s personnel expenses decreased by 52.2% to $3.1 million in the second quarter of FY2020-21 from $6.4 million from the previous quarter primarily due to a rationalization of headcount and reducing management salaries by 50% and variable reduction in salaries of 25-75% across the board. During the quarter ended September 30, 2020, the company incurred a one-time exit cost of $600,000 related to severance payouts.

In June, Yatra terminated a merger agreement with Ebix over alleged violation of agreement terms. It also initiated legal proceedings against Ebix in the Delaware Court of Chancery, seeking substantial damages.

In August, Ebix filed a motion to dismiss the complaint. In its recent filing, the company said it has filed an amended complaint by expanding its claims against certain banks of Ebix, while also expanding the claims alleged against Ebix to include a claim for fraud.

If the deal had gone through, the online travel agency would have had an enterprise valuation of $338 million, according to the merger agreement drafted on July 16, 2019.