Business context and reporting period
Yatra Online, Inc. is a Cayman Islands holding company whose operations are primarily in India. It operates an online travel platform across air ticketing, hotels and packages, and other travel services, serving consumers, corporate customers and travel agents.
This is the company’s Form 20-F annual report for the fiscal year ended March 31, 2020—not a standalone 2019 fourth-quarter filing. Financial statements are prepared under IFRS in Indian rupees (INR); amounts below are INR millions unless stated otherwise. The filing was signed July 31, 2020. The auditor gave an unqualified opinion on the financial statements.
Financial and operating performance
| Metric | FY2020 | FY2019 | Change / context |
|---|---|---|---|
| Revenue | 7,259.4 | 9,358.6 | Down 22.4% |
| Adjusted Revenue (non-IFRS) | 5,982.4 | 8,911.0 | Down 32.9% |
| Operating loss | (625.1) | (2,578.2) | Narrowed |
| Net loss | (840.2) | (1,193.6) | Narrowed |
| Adjusted EBITDA loss (non-IFRS) | (121.6) | (1,228.3) | Narrowed substantially |
| Operating cash flow | (550.4) | (3,542.1) | Cash outflow narrowed |
| Gross Bookings | 85,307.2 | 111,150.2 | Down 23.3% |
FY2020 revenue was approximately $96.3 million at the filing’s convenience exchange rate. Air ticketing revenue was INR 2,609.5 million versus INR 3,449.3 million; hotels and packages revenue was INR 3,601.8 million versus INR 4,914.4 million. Other revenue rose to INR 1,048.0 million from INR 994.9 million.
Adjusted Revenue fell faster than IFRS revenue, primarily reflecting weaker air and hotel/package activity. Air ticketing Adjusted Revenue declined 30.7%, and its net revenue margin fell to 5.1% from 5.8%. Hotels and Packages Adjusted Revenue declined 58.3%, with margin down to 9.9% from 13.9%. Adjusted Revenue is a company-defined non-IFRS measure; IFRS 15 changed the presentation of certain customer incentives and loyalty costs, and FY2019 comparatives were not restated.
Cost reductions contributed to narrower losses: personnel expense declined 30.3% to INR 1,777.3 million, while other operating expense declined 43.2% to INR 2,259.3 million. Marketing and sales promotion expense reported under IFRS fell to INR 196.2 million from INR 810.0 million, but the company explains that IFRS 15 reclassified certain promotional and loyalty costs as reductions to revenue. FY2020 included INR 222.0 million of goodwill impairment related mainly to hotel businesses.
Balance sheet, liquidity and cash flow
At March 31, 2020, total assets were INR 8,758.2 million, total liabilities INR 7,247.2 million, and total equity INR 1,511.0 million. Cash and cash equivalents were INR 1,365.4 million and term deposits INR 755.3 million; INR 633.3 million of term deposits were pledged. Trade and other receivables declined to INR 2,368.4 million from INR 4,921.3 million.
Reported borrowings were INR 1,525.1 million, including lease liabilities recognized following IFRS 16 adoption. Cash-flow reporting presents closing cash net of bank overdrafts at INR 646.2 million. The company used INR 550.4 million in operating cash and INR 333.5 million in financing activities; investing activities provided INR 96.6 million. It said cash and operating cash generation should cover needs for at least 12 months, while also warning that pandemic-related cancellations, refunds and reduced bookings were causing unfavorable working capital and material negative cash flow.
The company repaid its InnoVen term loans in December 2019. At year-end it had bank overdrafts and invoice discounting outstanding, as well as vehicle and lease liabilities. Certain bank covenant breaches were reported; ICICI Bank confirmed on July 30, 2020 that they were not being treated as events of default. The filing reports total current assets of INR 6,102.9 million and current liabilities of INR 6,407.3 million.
Material changes, outlook and key risks
- Demand and COVID-19: Bookings and traffic declined amid the pandemic and the cessation of Jet Airways’ operations. Management expected FY2021 to be affected more significantly by COVID-19 than FY2020, but provided no quantified revenue or earnings guidance. The filing describes elevated cancellations, refunds, working-capital pressure and material negative cash flow.
- Cost and workforce actions: The company reduced marketing, renegotiated rent and supplier terms, deferred non-critical capital spending and introduced salary reductions/freezes and remote work. In early July 2020 it reduced headcount by 917 employees. Planned FY2021 capital expenditure was approximately INR 75–100 million.
- Merger termination and financing: Yatra terminated its merger agreement with Ebix on June 5, 2020 and sued Ebix and EbixCash in Delaware, seeking damages and costs. The outcome is uncertain and litigation may be costly and divert management. A June 2020 follow-on offering raised net proceeds of approximately $10.5 million; the shares were sold at $0.80 each, diluting existing shareholders.
- ATB acquisition: After year-end, the final ATB purchase payment was determined at INR 800 million, INR 390 million below the INR 1,190 million recorded provision. The July 2020 closing made ATB a wholly owned subsidiary. Verify the ultimate cash/payment and accounting treatment.
- Contingencies and counterparties: The financial statement notes disclose INR 251.3 million of service-tax and INR 96.6 million of income-tax claims as contingent liabilities, which management considered unlikely to materialize. Elsewhere, the filing describes additional tax demands and appeals, including significant service-tax assessments; amounts and proceedings should be reconciled. Jet Airways receivables were considered at risk, and airline/GDS commission changes and Air India inventory changes pressured air-ticketing economics.
- Listing and dilution: Nasdaq notified the company in July 2020 that its share price had been below $1 for 30 consecutive business days, with an initial compliance deadline of January 25, 2021. Warrants, options and share awards may add dilution. The filing also identifies competition, currency exposure without hedging, India regulatory/tax uncertainty and dependence on travel suppliers as material risks.
Important facts for investors to verify
- Reconcile the sharp FY2020 declines in Gross Bookings and Adjusted Revenue with IFRS 15 presentation changes, promotional costs and acquired-business contributions.
- Track post-year-end cash burn, refund obligations, unrestricted liquidity, pledged deposits, overdraft/invoice-discounting use and the status of bank covenants.
- Assess whether the stated 12-month liquidity expectation remained supportable after the pandemic’s worsening impact and the June 2020 equity raise.
- Confirm the completed ATB settlement/payment and reconcile tax contingent-liability figures with the larger assessments and appeals described in the filing.
- Monitor the Ebix litigation, Nasdaq bid-price compliance, and potential dilution from the offering, warrants, options and equity awards.
- Compare reported results with the non-IFRS Adjusted Revenue and Adjusted EBITDA measures, including their reconciliations and exclusions. Management reported effective disclosure controls and internal control over financial reporting; the auditor did not provide an opinion on internal-control effectiveness.