Online food delivery platform Zomato on Monday reported a widening of its net loss to Rs 359.7 crore during the March 2022 quarter, compared with Rs 134.2 crore in the corresponding quarter last year. Its revenue from operations during January-March 2022 stood at Rs 1,211.8 crore, a jump of 75.01 per cent as against Rs 692.4 crore in the year-ago period.
The company’s total expenses almost doubled to Rs 1,701.7 crore during the March 2022 quarter, compared with Rs 885 crore a year ago, according to a regulatory filing.
Zomato said, “Adjusted revenue grew 8 per cent quarter-over-quarter (q-o-q) and 67 per cent year-over-year (y-o-y) to Rs 15.4 billion (Rs 1,540 crore) in Q4FY22. Adjusted Ebitda loss reduced to Rs 2.2 billion (-15 per cent of adjusted revenue) in Q4FY22 as compared to Rs 2.7 billion (-19% of adjusted revenue) in Q3FY22.”
The company also said it expects adjusted revenue growth to accelerate to double digits in the next quarter and the Adjusted Ebitda losses to also come down meaningfully. Reduction in losses will be driven by improvement in the contribution margin of the food delivery business and also operating leverage playing out as our revenue is growing faster than our fixed costs. Ebitda stands for earnings before interest, tax, depreciation and amortisation.
Its gross order value grew 6 per cent q-o-q and 77 per cent y-o-y to a record high of Rs 5,850 crore in Q4FY22. This was driven by healthy growth in order volumes while the average order value remained stable.
Zomato launched over 300 new cities in the fourth quarter of 2021-22 and is now present in more than 1,000 towns and cities across India, it said.
On many minority equity investments, Zomato founder and CEO Deepinder Goyal said, “The rationale behind making minority investments has been twofold – 1) put the building blocks for a robust quick-commerce business in India, and 2) accelerate digitisation and growth of the food and restaurant industry which accelerates our core food business. All our investments fit into one of these two buckets.”
He also said the company is seeing that the contribution margin in a smaller city currently is lower than the larger cities, given the lower order values. As observed across various cities, this will change as the order density goes up, the network effect kicks in, and the company is then able to lower marketing costs as well as delivery costs.
The company said average monthly transacting customers were at an all-time high of 15.7 million last quarter growing from 15.3 million in the previous quarter. Likewise, average monthly active restaurant partners and delivery partners were at all time highs as well. “New customer addition remains healthy and similar to Q3 numbers despite reduced marketing spends (-14 per cent quarter-on-quarter),” it added.
For the full financial year, Zomato’s loss stood at Rs 1,222.5 crore in 2021-22, compared with Rs 816.4 in the previous year. Its revenue in FY22 also increased to Rs 4,192.4 crore from Rs 1,993.8 crore. Its average order value for FY22 was Rs 398, against Rs 397 in the previous year. For the top-eight cities, the company saw the value increase by three per cent in FY22 as compared with FY21.
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