Food delivery giant Zomato on Monday reported widening of its consolidated net loss to Rs 360 crore in the fourth quarter ending March 31, 2022. The company had reported net loss of Rs 134 crore in the year-ago period.
Zomato's consolidated revenue from operations rose 75 per cent to Rs 1,212 crore as against Rs 692 crore in the same quarter last fiscal.
Deepinder Goyal, Managing Director & Chief Executive Officer, Zomato, also mentioned that its adjusted revenue grew 8 per cent quarter-over-quarter (QoQ) and 67 per cent year-over-year (YoY) to Rs 1,540 crore in Q4FY22. Adjusted EBITDA loss reduced to Rs 220 crore (-15% of Adjusted Revenue) in the quarter as compared to Rs 270 crore (-19% of Adjusted Revenue) in Q3FY22.
The company 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 a contribution margin of the food delivery business and also operating leverage playing out as our revenue is growing faster than our fixed costs,” it said.
Meanwhile, Zomato's Gross Order Value (GOV) grew by 6 per cent QoQ and 77 per cent YoY to a record high of Rs 5,850 crore in the said quarter. "This was driven by healthy growth in order volumes while the average order value remained stable."
"We expect to get to a double digit contribution margin (as a % of GOV) in the long term as we are already seeing some of our cities trending towards that," said Zomato Chief Financial Officer Akshant Goyal.
The company further stated that in the quarter under review, the company witnessed an average monthly transacting customers at an all time high of 15.7 million, 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.
For the fiscal year 2022, losses of the company came in at Rs 1222 crore, compared to Rs 816 in the same quarter last fiscal.
Moreover, Zomato also added that during the fourth quarter, it launched 300+ new cities and are now present in 1,000+ towns and cities across India.
On plans of Blinkit and potential M&A, Deepinder stated, "We continue to remain bullish on quick commerce, especially given how synergistic it is to our core food delivery business, and are excited with the progress that Blinkit has made in this space. While there is a lot to do as the business is at its early stages, there’s still a lot of low hanging fruit to drive growth and efficiency."
Blinkit has grown well in the past six months, and has also significantly reduced its operating losses. We have committed to give them a short term loan of up to $150 million to fund their short term capital needs. Beyond that, there is nothing to share at this moment, he added.
Commenting on Zomato Instant, the 10-minute food delivery service pilot, Goyal said the company is still studying to understand whether customers order more if delivery time reduces to 10 minutes, and is there a business model where delivery of food can be done in 10 minutes at the same or better contribution per order than the company's existing business.
''We do not have any answers here yet as the pilot has been live for a few days and only in one location,'' he said, adding some update on this could be expected in the next quarter and scaling it further would depend on the outcome of the current pilot.
On the 'gig worker' shortage, he said Zomato is ''seeing some stress on the availability of delivery partners in the current quarter in select large cities since the last week of April.'' While terming it as short-term in nature as the post-COVID economic recovery has brought back jobs in cities, he said the company lost some delivery partners to such jobs.
Moreover, Goyal said, all the workforce which migrated to their hometowns or villages during the first COVID-19 wave has not yet come back to the cities for work, ''thus hampering our delivery partner acquisition rate.'' ''We think things will normalise in a few weeks. We are also working on various long term initiatives to drive more stability of delivery partners in our fleet,'' he said.
On Monday, the company's scrip on BSE closed 2% lower at Rs 56.80.
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