Zomato Q1 Net Loss Rises Due To ESOP
- ByAyushi Ray | August 11, 2021
Food delivery app Zomato Q1 net loss rises due to ESOP. Zomato recently went for an IPO, last month which proved to be quite successful. However, in the financial quarter ending June 30, the company saw their loss increase to ₹360.7 crore in the quarter from ₹134.2 crore in the preceding three months because of an expanded Employee Stock Ownership Plan (ESOP) pool. The company compared earnings sequentially as its financials for the first quarter of FY21 were severely impacted because of the Covid-19 outbreak and subsequent national lockdown. Revenue from operations and delivery charges rose 26% to ₹1,160 crore for the fiscal first quarter from ₹920 crore in the year earlier. On Tuesday, Zomato shares fell 4.22% to ₹124.9 on BSE, while the benchmark Sensex index rose 0.28%.
“Adjusted EBITDA loss was ₹170 crore in Q1 FY22 as compared to ₹120 crore in Q4 FY21. The loss for Q1 FY22 reported in our financial statements is ₹360 crore as compared to the adjusted EBITDA loss of ₹170 crore. This is largely on account of non-cash ESOP expenses, which have increased meaningfully in Q1 FY22 due to significant ESOP grants made in the quarter pursuant to the creation of a new ESOP 2021 scheme,” Zomato chief Deepinder Goyal said in a statement. Zomato reported an employee benefits expense of ₹390.7 crore in Q1FY22 against ₹191.7 crore in Q4FY21. The company said that core delivery services grew in the first quarter, but the dining out services were adversely impacted. Its food-delivery gross order value grew 37% to ₹4,540 crore in the June quarter from ₹3,310 crore in the preceding three months. “Our India food delivery business continues to remain contribution positive; although the contribution margin reduced slightly in Q1 FY22 as compared to the previous quarter on account of growth investments in addition to the costlier business environment (due to lockdowns) in which this growth was achieved,” Goyal added.
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