Hospitality chain OYO Hotels and Homes reported a consolidated revenue of $951 million for FY19, which it claims is a 4.5X growth over the previous financial year when the company reported a revenue of $211 million. However, OYO’s net loss grew to 35% of the revenue to $335 million in FY19.
According to a statement from the company, the net loss is a result of inherent costs of establishing a presence in new markets and costs related to talent, market-entry, operational expenses among others.
In the financial year, India contributed to 63.5% ($604 million) of the consolidated revenue and clocked a growth of 2.9X year-on-year. OYO said in a statement that with India now being a mature market for it, the focus is on maintaining strong brand preference while ensuring there is a clear path to profitability, enabled by accretive growth, operational excellence, and strong gross margin.
It also claims to have reduced its losses in India from 24% to 14% of revenue in FY19 to $83 million, while improving gross margins from 10.6% in FY18 to 14.7% in FY19.
With China and other international markets being in the development and investment mode during the financial year, they contributed to 75% of the losses for FY19 ($252 million). These markets constituted 36.5% of the global revenues.
OYO claims that it has reported an increase in daily guest check-ins and in hotels and asset owners across the world. With over 43,000 asset partners, OYO hosted over 180 million guests from 120+ nationalities between January - December 2019.
“As we work towards consistently improving our financial performance, ensuring strong yet sustainable growth, high operational and service excellence and a clear path to profitability will be our key to our approach in 2020 and beyond. The company’s increased focus on corporate governance and building a high-performing and employee-first work culture will also drive this next phase of sustainable growth for us. We look forward to adding value to the experience of travellers and asset partners across the globe,” Abhishek Gupta, Global CFO of OYO Hotels & Homes, said in a statement.