PAGE 0 November 2016 September 2020 Disclaimer This presentation is for informational purposes only and does not constitute an offer to sell, a solicitation of any offer to buy, or a recommendation to purchase any securities of or any of its affiliates (as such term is defined under the U.S. federal securities laws). The presentation shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities. This presentation shall also not constitute an offer to sell or the sol ...

Yatra Online, Inc. (NASDAQ:YTRA) Q1 2021 Earnings Conference Call September 9, 2020 8:30 AM ET Corporate Participants Manish Hemrajani - Head, Investor Relations Dhruv Shringi - Co-Founder and Chief Executive Officer Conference Call Participants Operator Good day, and welcome to the Yatra First Quarter 2021 Earnings Conference Call. Today's conference is being recorded. As a reminder, we will not be taking any questions from the press today. At this time, I would like to turn the conference over to Mr. Mani ...

PAGE 0 November 2016 September 2020 Disclaimer This presentation is for informational purposes only and does not constitute an offer to sell, a solicitation of any offer to buy, or a recommendation to purchase any securities of or any of its affiliates (as such term is defined under the U.S. federal securities laws). The presentation shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities. This presentation shall also not constitute an offer to sell or the sol ...

PART I [Item 3. KEY INFORMATION](index=9&type=section&id=Item%203.%20KEY%20INFORMATION) This section presents Yatra Online's selected consolidated financial data and key risk factors from FY2016-2020, covering pandemic, merger, business, and operational risks [Selected Consolidated Financial Data](index=9&type=section&id=A.%20Selected%20Consolidated%20Financial%20Data) Key financial data shows a **22.4% revenue decline** in FY2020 to **INR 7,259.4 million**, narrowed losses, and significant drops in gross bookings Consolidated Statement of Profit or Loss Highlights (INR thousands) | Indicator | FY 2018 | FY 2019 | FY 2020 | | :--- | :--- | :--- | :--- | | **Total revenue** | 12,248,513 | 9,358,580 | 7,259,355 | | **Results from operations** | (3,360,133) | (2,578,199) | (625,054) | | **Loss for the period** | (4,051,976) | (1,193,595) | (840,195) | | **Basic Loss per share (INR)** | (116.41) | (26.37) | (17.94) | | **Diluted Loss per share (INR)** | (116.41) | (26.95) | (17.94) | Consolidated Statement of Financial Position Highlights (INR thousands) | Indicator | As of March 31, 2018 | As of March 31, 2019 | As of March 31, 2020 | | :--- | :--- | :--- | :--- | | **Total assets** | 11,616,787 | 12,551,897 | 8,758,190 | | **Total liabilities** | 11,842,066 | 10,172,727 | 7,247,216 | | **Total equity** | (224,918) | 2,359,749 | 1,491,941 | Key Operational Metrics (Figures in thousands) | Metric | FY 2018 | FY 2019 | FY 2020 | | :--- | :--- | :--- | :--- | | **Air Passengers** | 8,875 | 10,163 | 8,179 | | **Hotel room nights** | 2,098 | 2,341 | 1,200 | | **Gross Bookings (Air Ticketing, INR)** | 79,156,190 | 97,638,313 | 77,411,328 | | **Gross Bookings (Hotels and Packages, INR)** | 13,386,288 | 13,511,914 | 7,895,916 | | **Adjusted Revenue (Total, INR)** | 7,407,757 | 8,911,013 | 5,982,428 | - Effective April 1, 2018, the company adopted **IFRS 15**, reclassifying certain customer inducement and acquisition costs from marketing expenses to an offset against revenue[38](index=38&type=chunk) [Risk Factors](index=12&type=section&id=D.%20Risk%20Factors) The company faces substantial risks from the **COVID-19 pandemic**, terminated **Ebix merger**, operating losses, intense competition, supplier reliance, and potential **NASDAQ delisting** - The **COVID-19 pandemic** severely restricted global economic activity, negatively impacting the travel industry with high cancellations and material negative cash flow[52](index=52&type=chunk) - The company terminated its merger agreement with **Ebix, Inc.** and initiated litigation, posing risks of substantial legal costs, management distraction, and adverse impacts on share price and operations[58](index=58&type=chunk)[61](index=61&type=chunk) - The company has a history of operating losses, with net losses of **INR 840.2 million in FY2020**, **INR 1,193.6 million in FY2019**, and **INR 4,052.0 million in FY2018**, with no guarantee of future profitability[62](index=62&type=chunk) - The Indian travel industry is highly competitive, with pressure from **OTAs** (e.g., MakeMyTrip), traditional companies, and new entrants, potentially reducing service fees and **Net Revenue Margins**[66](index=66&type=chunk)[67](index=67&type=chunk) - A substantial portion of Air Ticketing revenue relies on a **small number of domestic Indian airlines**, exposing the business to industry risks like supplier bargaining power and airline insolvencies[80](index=80&type=chunk)[76](index=76&type=chunk) - The company received a **NASDAQ non-compliance notification** for failing to meet the **$1.00 minimum bid price**, risking delisting which would adversely affect stock liquidity and capital raising ability[203](index=203&type=chunk)[204](index=204&type=chunk)[205](index=205&type=chunk) [Item 4. INFORMATION ON THE COMPANY](index=50&type=section&id=Item%204.%20INFORMATION%20ON%20THE%20COMPANY) This section provides a comprehensive overview of Yatra Online, Inc., detailing its history, business model, services, and operational structure [History and Development of the Company](index=50&type=section&id=A.%20History%20and%20Development%20of%20our%20Company) Yatra Online, Inc., incorporated in the Cayman Islands in 2005, commenced operations in India in 2006 and is a leading online travel company - Yatra Online, Inc. is a Cayman Islands exempted company, incorporated on **December 15, 2005**, with its principal executive office in Gurugram, India[243](index=243&type=chunk) - The company commenced operations in **August 2006** and has grown to become a leading online travel company in India, serving both leisure and business travelers[244](index=244&type=chunk) [Business Overview](index=50&type=section&id=B.%20Business%20Overview) Yatra provides comprehensive travel services through B2C, B2E, and B2B2C channels, with recent developments dominated by the **COVID-19 pandemic** and the terminated **Ebix merger** - Yatra offers a wide range of travel services including domestic and international air ticketing, bus and rail ticketing, cab bookings, and access to approximately **102,000 hotels and homestays in India** and over **1.6 million hotels globally** as of June 30, 2020[246](index=246&type=chunk) - The company employs a multi-channel go-to-market strategy: **B2C** (direct to consumer), **B2E** (corporate clients, with over **700 large customers**), and **B2B2C** (a network of approximately **26,000 travel agents**)[248](index=248&type=chunk)[277](index=277&type=chunk)[278](index=278&type=chunk) - The **COVID-19 pandemic** has had a significant negative effect on the business, leading to unprecedented cancellations, negative cash flow, and the implementation of cost-reduction initiatives[258](index=258&type=chunk) - On **June 5, 2020**, Yatra terminated its merger agreement with **Ebix, Inc.** and filed a lawsuit against Ebix for alleged breaches of the agreement[266](index=266&type=chunk) Key Performance Indicators (FY2020 vs FY2019) | Metric | FY 2019 | FY 2020 | Change | | :--- | :--- | :--- | :--- | | **Revenue (INR M)** | 9,358.6 | 7,259.4 | -22.4% | | **Adjusted Revenue (INR M)** | 8,911.0 | 5,982.4 | -32.9% | | **Gross Bookings (Air & Hotels, INR B)** | 111.1 | 85.3 | -23.3% | | **Net Loss (INR M)** | (1,193.6) | (840.2) | Narrowed | - The company's growth strategy includes cost-effectively growing its customer base, leveraging its multi-channel approach and loyalty programs (eCash), investing in its technology platform, focusing on Tier 2 and Tier 3 markets, and pursuing strategic acquisitions like ATB and TCIL[318](index=318&type=chunk)[320](index=320&type=chunk)[321](index=321&type=chunk) [Item 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS](index=79&type=section&id=Item%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section analyzes Yatra's financial condition and operating results, detailing the impact of **COVID-19** and the **Ebix merger**, key metrics, liquidity, and non-IFRS measures [Key Operating Metrics](index=82&type=section&id=Key%20Operating%20Metrics) Key operating metrics show a significant downturn in FY2020, with **Total Gross Bookings falling to INR 85.3 billion** and **Adjusted Revenue decreasing to INR 5.98 billion** Gross Bookings (INR thousands) | Segment | FY 2018 | FY 2019 | FY 2020 | | :--- | :--- | :--- | :--- | | **Air ticketing** | 79,156,190 | 97,638,313 | 77,411,328 | | **Hotels and packages** | 13,386,288 | 13,511,914 | 7,895,916 | | **Total** | 92,542,478 | 111,150,227 | 85,307,244 | Reconciliation of Revenue to Adjusted Revenue (INR thousands) | Description | FY 2018 | FY 2019 | FY 2020 | | :--- | :--- | :--- | :--- | | **Revenue (IFRS)** | 12,248,513 | 9,358,580 | 7,259,355 | | Add: Customer promotional expenses | - | 3,571,451 | 1,486,371 | | Less: Service cost | (4,930,757) | (4,282,803) | (2,922,929) | | Add: Other Income | 90,001 | 263,785 | 159,631 | | **Adjusted Revenue (Non-IFRS)** | **7,407,757** | **8,911,013** | **5,982,428** | Net Revenue Margins (%) | Segment | FY 2018 | FY 2019 | FY 2020 | | :--- | :--- | :--- | :--- | | **Air Ticketing** | 6.3% | 5.8% | 5.1% | | **Hotels and Packages** | 12.7% | 13.9% | 9.9% | [Results of Operations](index=95&type=section&id=Results%20of%20Operations) Yatra's FY2020 operating results show a **22.4% revenue decrease** to **INR 7,259.4 million**, but a **75.8% improvement in operating loss** due to reduced expenses Fiscal Year 2020 vs. 2019 Performance (INR thousands) | Metric | FY 2019 | FY 2020 | % Change | | :--- | :--- | :--- | :--- | | **Total revenue** | 9,358,580 | 7,259,355 | -22.4% | | **Adjusted Revenue** | 8,911,013 | 5,982,428 | -32.9% | | **Results from operations** | (2,578,199) | (625,054) | 75.8% improvement | | **Loss for the year** | (1,193,595) | (840,195) | 29.6% improvement | | **Marketing & sales promotion expenses** | 809,996 | 196,209 | -75.8% | - In FY2020, Adjusted Revenue from Air Ticketing decreased by **30.7%**, and Adjusted Revenue from Hotels and Packages decreased by **58.3%**, reflecting the severe impact on both segments[531](index=531&type=chunk)[533](index=533&type=chunk)[535](index=535&type=chunk) - A goodwill impairment charge of **INR 222.0 million** was recorded in Q4 FY2020 due to the negative impact of the **COVID-19 pandemic** on the travel industry[544](index=544&type=chunk) - In FY2019, total revenue decreased **23.6%** from FY2018, primarily due to the adoption of **IFRS 15**, though Adjusted Revenue increased by **20.3%** to **INR 8,911.0 million**[555](index=555&type=chunk)[557](index=557&type=chunk) [Liquidity and Capital Resources](index=102&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2020, Yatra's liquidity included **INR 1,365.4 million in cash** and **INR 755.3 million in term deposits**, with net cash used in operating activities significantly improving to **INR 550.4 million** Liquidity Position (INR millions) | Item | As of March 31, 2019 | As of March 31, 2020 | | :--- | :--- | :--- | | **Cash and cash equivalents** | 2,161.0 | 1,365.4 | | **Term deposits** | 1,029.5 | 755.3 | | **Pledged term deposits** | 1,015.3 | 633.4 | Summary of Cash Flows (INR thousands) | Cash Flow Activity | FY 2019 | FY 2020 | | :--- | :--- | :--- | | **Net cash used in operating activities** | (3,542,134) | (550,356) | | **Net cash (used in)/from investing activities** | (650,325) | 96,643 | | **Net cash from/(used in) financing activities** | 2,904,580 | (333,471) | - The company breached certain debt covenants with **ICICI Bank** due to the impact of **COVID-19**, but the bank confirmed these would not be treated as an event of default[589](index=589&type=chunk) - Capital expenditures decreased significantly from **INR 899.3 million in FY2019** to **INR 437.2 million in FY2020**, with further reductions planned for FY2021[608](index=608&type=chunk) [Item 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](index=109&type=section&id=Item%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details Yatra's board of directors and senior management, their compensation, board practices, and beneficial share ownership [Directors and Senior Management](index=112&type=section&id=A.%20Directors%20and%20Senior%20Management) The company is led by co-founder and CEO Dhruv Shringi, with a senior management team and board of directors comprising experienced professionals - The executive team is led by co-founders **Dhruv Shringi (CEO)** and **Manish Amin (CIO)**[653](index=653&type=chunk)[654](index=654&type=chunk) - The Board of Directors includes experienced professionals such as **Sean Aggarwal**, **Neelam Dhawan**, and **Sanjay Arora**[658](index=658&type=chunk)[660](index=660&type=chunk)[661](index=661&type=chunk) [Compensation](index=115&type=section&id=B.%20Compensation) Non-executive directors receive an annual base fee of **$15,000**, while aggregate executive compensation was **INR 60.7 million** in FY2020, excluding equity awards under the 2006 and 2016 incentive plans - Non-executive directors receive a **$15,000 annual fee** plus a **$10,000 retainer** for each committee membership[663](index=663&type=chunk) - Aggregate compensation for the executive director and senior management in FY2020 was **INR 60.7 million**, excluding equity compensation[665](index=665&type=chunk) - The company has two main equity plans: the **2006 India Share Plan** and the **2016 Stock Option and Incentive Plan**, with 614,418 options and significant RSUs outstanding as of March 31, 2020[666](index=666&type=chunk)[677](index=677&type=chunk)[682](index=682&type=chunk) - In FY2020, the company deferred the vesting of **643,147 RSUs** (granted in FY2017) and **263,115 RSUs** (granted in FY2018) until December 31, 2020[666](index=666&type=chunk)[671](index=671&type=chunk) [Board Practices](index=119&type=section&id=C.%20Board%20Practices) The board of directors consists of five members with staggered three-year terms and three key committees, operating under certain foreign private issuer exemptions - The board is divided into **three classes** with staggered three-year terms, which can make it more difficult for shareholders to change a majority of the directors at one time[698](index=698&type=chunk)[706](index=706&type=chunk) - The company has three key board committees: **Audit**, **Compensation**, and **Nominating and Corporate Governance**, with defined responsibilities and independent members[705](index=705&type=chunk)[706](index=706&type=chunk)[708](index=708&type=chunk) - As a foreign private issuer, Yatra is exempt from certain SEC rules and may follow home country governance practices, having not held an annual general meeting since **December 12, 2018**[714](index=714&type=chunk)[702](index=702&type=chunk) [Share Ownership](index=123&type=section&id=E.%20Share%20Ownership) This subsection details the beneficial ownership of Yatra's shares as of March 31, 2020, listing major shareholders and management holdings Major Shareholders (Beneficial Ownership > 5%) as of March 31, 2020 | Shareholder Group | Percentage of Outstanding Shares | | :--- | :--- | | **Entities Affiliated with Nathan Leight** | 15.15% | | **Macquarie Group Limited** | 12.43% | | **Entities Affiliated with Altai Capital Management, LLC** | 10.52% | | **RCH Ltd.** | 7.55% | | **Entities Affiliated with Vincent C. Smith** | 5.95% | | **Entities Affiliated MAK Capital One L.L.C.** | 5.89% | | **E-18 Limited & Capital18 Fincap Private Limited** | 5.38% | | **Entities Affiliated with Norwest Venture Partners** | 5.16% | - All current directors and executive officers as a group beneficially owned approximately **3.73%** of the outstanding shares as of March 31, 2020[723](index=723&type=chunk) [Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](index=127&type=section&id=Item%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section details the company's major shareholders and outlines significant related party transactions, including a preload agreement with **Reliance Retail Ltd.** and an **Investor Rights Agreement** - The company has an **Investor Rights Agreement** that grants major shareholders, including **MIHI LLC** and the **Terrapin Sponsors**, registration rights and the right to nominate directors and appoint board observers[734](index=734&type=chunk)[737](index=737&type=chunk) - An agreement with **Reliance Retail Ltd.** involves pre-installing the Yatra mobile application on **Reliance Jio LYF smartphones**, with consideration to be settled in equity shares of Yatra India[732](index=732&type=chunk)[733](index=733&type=chunk) - An **Exchange and Support Agreement** allows holders of Yatra USA Class F common stock to exchange their shares for Yatra Online, Inc. Ordinary Shares until **December 16, 2021**[739](index=739&type=chunk) [Item 8. FINANCIAL INFORMATION](index=129&type=section&id=Item%208.%20FINANCIAL%20INFORMATION) This section refers to the consolidated financial statements in Item 18, notes the absence of material adverse legal proceedings, and states no plans for dividend payments - The company is involved in various tax proceedings in India but does not believe any ongoing legal or arbitration proceedings will have a material adverse effect on its financial position[745](index=745&type=chunk)[746](index=746&type=chunk) - Yatra does not anticipate paying dividends in the near future, as it plans to retain all future earnings for business operation and expansion[747](index=747&type=chunk) [Item 10. ADDITIONAL INFORMATION](index=131&type=section&id=Item%2010.%20ADDITIONAL%20INFORMATION) This section provides supplementary information on share capital, Indian exchange controls, foreign investment regulations, and U.S. and Indian federal income tax consequences for shareholders - Foreign investment in Indian companies is regulated by **FEMA** and the **FDI policy**, which may affect the company's ability to make future investments in India and restricts lending to or borrowing from its Indian subsidiary[758](index=758&type=chunk) - The company's ability to pay dividends is dependent on receiving dividends from its Indian subsidiary, **Yatra India**, which is subject to Indian laws and potential dividend distribution taxes[760](index=760&type=chunk) - For U.S. federal income tax purposes, the company believes it should be treated as a foreign corporation and not a U.S. corporation under **Section 7874 of the Code**[777](index=777&type=chunk)[780](index=780&type=chunk) - The company does not expect to be classified as a **Passive Foreign Investment Company (PFIC)** for the current taxable year or the foreseeable future, but this status is determined annually and cannot be guaranteed[795](index=795&type=chunk) - Under Indian tax law, non-resident investors may be subject to Indian taxes on capital gains from the sale of Yatra's ordinary shares, as the shares derive their value substantially from assets located in India[814](index=814&type=chunk)[815](index=815&type=chunk) [Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=145&type=section&id=Item%2011.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to credit risk from trade receivables, liquidity risk managed by cash reserves, and foreign currency risk from operating transactions, without current hedging agreements - The company is exposed to **credit risk** from operating activities, primarily trade receivables from customers and suppliers[841](index=841&type=chunk) - **Liquidity risk** is managed by maintaining adequate cash reserves and banking facilities, with current cash and operations expected to be sufficient for at least the next **12 months**[843](index=843&type=chunk)[845](index=845&type=chunk) - **Foreign currency risk** exists due to transactions denominated in currencies other than the functional currencies of its subsidiaries, though the company does not currently use hedging instruments to mitigate this risk[846](index=846&type=chunk) PART II [Item 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS](index=147&type=section&id=Item%2014.%20MATERIAL%20MODIFICATIONS%20TO%20THE%20RIGHTS%20OF%20SECURITY%20HOLDERS%20AND%20USE%20OF%20PROCEEDS) In June 2020, the company completed a follow-on public offering of **14,375,000 ordinary shares** at **$0.80 per share**, generating **$10.5 million in net proceeds** for general corporate purposes - On **June 23-24, 2020**, Yatra completed a follow-on public offering of **14,375,000 ordinary shares** at **$0.80 per share**[855](index=855&type=chunk) Follow-on Offering Details | Metric | Amount | | :--- | :--- | | **Shares Sold** | 14,375,000 | | **Price per Share** | $0.80 | | **Aggregate Gross Proceeds** | $11.4 million | | **Net Proceeds** | $10.5 million | [Item 15. CONTROLS AND PROCEDURES](index=147&type=section&id=Item%2015.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of March 31, 2020, with no material changes reported - Management, including the CEO and Principal Financial Officer, concluded that the company's disclosure controls and procedures were **effective** as of **March 31, 2020**[856](index=856&type=chunk)[857](index=857&type=chunk) - Based on an assessment using the **COSO 2013 framework**, management concluded that the company's internal control over financial reporting was **effective** as of **March 31, 2020**[860](index=860&type=chunk)[861](index=861&type=chunk) - As an emerging growth company, Yatra is exempt from the auditor attestation requirements of the **Sarbanes-Oxley Act** regarding internal control over financial reporting[862](index=862&type=chunk) PART III [Item 18. FINANCIAL STATEMENTS](index=151&type=section&id=Item%2018.%20FINANCIAL%20STATEMENTS) This section contains the audited consolidated financial statements of Yatra Online, Inc. for the fiscal years ended March 31, 2020, 2019, and 2018, prepared in accordance with IFRS - The financial statements were audited by **Ernst & Young Associates LLP**, who issued an opinion that the statements are fairly presented in conformity with **IFRS** as issued by the IASB[890](index=890&type=chunk) - The financial statements cover the **three-year period ended March 31, 2020**, providing comparative data on the company's performance and financial health[890](index=890&type=chunk)

[PART I](index=9&type=section&id=PART%20I) [KEY INFORMATION](index=9&type=section&id=Item%203.%20KEY%20INFORMATION) This section presents Yatra's selected consolidated financial data, highlighting a **net loss of INR 1,193.6 million** in fiscal 2019 and outlining significant merger and industry risks [Selected Consolidated Financial Data](index=9&type=section&id=A.%20Selected%20Consolidated%20Financial%20Data) The company's financial data shows a **decrease in total revenue to INR 9,358.6 million** in fiscal 2019 due to IFRS 15 adoption, alongside a **net loss of INR 1,193.6 million** and **increased gross bookings to INR 111.15 billion** - Effective April 1, 2018, the company adopted IFRS 15, impacting revenue recognition and comparability, as certain customer inducement and acquisition costs are now offset against revenue[32](index=32&type=chunk) Consolidated Statement of Profit or Loss Data (INR in thousands) | Fiscal Year Ended March 31, | 2017 (INR thousands) | 2018 (INR thousands) | 2019 (INR thousands) | | :--- | :--- | :--- | :--- | | **Total revenue** | 9,356,813 | 12,248,513 | 9,358,580 | | **Results from operations** | (1,863,415) | (3,360,133) | (2,578,199) | | **Loss for the period** | (5,936,963) | (4,051,976) | (1,193,595) | | **Basic Loss per share (INR)** | (237.89) | (116.41) | (26.37) | | **Diluted Loss per share (INR)** | (237.89) | (116.41) | (26.95) | Consolidated Statement of Financial Position Data (INR in thousands) | As of March 31, | 2017 (INR thousands) | 2018 (INR thousands) | 2019 (INR thousands) | | :--- | :--- | :--- | :--- | | **Total assets** | 9,574,434 | 11,616,787 | 12,551,897 | | **Total liabilities** | 6,384,865 | 11,842,066 | 10,172,727 | | **Total equity** | 429,472 | (224,918) | 2,359,749 | Key Operational Metrics (Fiscal Year Ended March 31) | Metric | 2017 | 2018 | 2019 | | :--- | :--- | :--- | :--- | | **Gross Bookings (INR thousands)** | | | | | Air Ticketing | 57,562,263 | 79,156,190 | 97,638,313 | | Hotels and Packages | 10,435,643 | 13,386,288 | 13,511,914 | | **Total Gross Bookings (INR thousands)** | **67,997,906** | **92,542,478** | **111,150,227** | | **Adjusted Revenue (INR thousands)** | 5,202,608 | 7,407,757 | 8,911,013 | | **Net Revenue Margin %** | | | | | Air Ticketing | 6.4% | 6.3% | 5.8% | | Hotels and Packages | 11.0% | 12.7% | 13.9% | [Risk Factors](index=13&type=section&id=D.%20Risk%20Factors) The company faces substantial risks from its pending merger with Ebix, a history of operating losses, intense industry competition, reliance on the Indian economy, and evolving regulatory and tax environments - The merger with Ebix is not assured, subject to closing conditions, and failure to complete it could negatively impact the company, potentially incurring an **$8.16 million termination fee**[46](index=46&type=chunk)[48](index=48&type=chunk) - The company has a history of operating losses, including a **net loss of INR 1,193.6 million in fiscal 2019**, and faces intense competition and high sensitivity to Indian economic and travel sector disruptions[65](index=65&type=chunk)[66](index=66&type=chunk)[74](index=74&type=chunk)[78](index=78&type=chunk) - Operational risks include significant reliance on a few domestic Indian airlines, potential reductions in commissions, and vulnerability to safety concerns, terrorist attacks, health crises, and natural calamities[80](index=80&type=chunk)[83](index=83&type=chunk)[87](index=87&type=chunk) - Evolving Indian laws, including the complex Goods and Services Tax (GST) regime, increase compliance costs, and changes in tax law regarding Place of Effective Management (PoEM) could subject global income to Indian taxation[171](index=171&type=chunk)[173](index=173&type=chunk)[182](index=182&type=chunk)[185](index=185&type=chunk) - As a Cayman Islands company and a foreign private issuer, judicial precedent on shareholder rights is limited, and reduced SEC reporting requirements may offer less investor protection[203](index=203&type=chunk)[210](index=210&type=chunk)[212](index=212&type=chunk) [INFORMATION ON THE COMPANY](index=52&type=section&id=Item%204.%20INFORMATION%20ON%20THE%20COMPANY) Yatra Online, Inc. is a leading Indian online travel company, recently entering a merger agreement with Ebix, operating a multi-channel platform for diverse travel services, and facing ongoing litigation and regulatory challenges [History and Development of our Company](index=52&type=section&id=A.%20History%20and%20Development%20of%20our%20Company) Yatra Online, Inc., incorporated in 2005, is a leading Indian online travel company that entered a merger agreement with Ebix, Inc. on July 16, 2019 - Yatra is a leading Indian online travel company, serving approximately **9.7 million travelers** as of March 31, 2019, and is positioned as India's largest independent corporate travel services provider[240](index=240&type=chunk) - On July 16, 2019, Yatra entered a merger agreement with Ebix, Inc., under which Yatra will become a wholly-owned subsidiary of Ebix upon completion[241](index=241&type=chunk) [Business Overview](index=53&type=section&id=B.%20Business%20Overview) Yatra offers a wide range of travel services through a multi-channel strategy on a single technology platform, focusing on customer growth, loyalty, technology investment, and strategic acquisitions, while navigating intense competition and Indian regulations - Yatra operates through **B2C, B2E, and B2B2C** go-to-market strategies, leveraging a single technology platform to serve diverse market segments[244](index=244&type=chunk)[279](index=279&type=chunk) - The company emphasizes a "Mobile First" model, with mobile platforms accounting for approximately **81% of total consumer visits** in fiscal year 2019, and mobile traffic growing **14% year-over-year**[248](index=248&type=chunk)[283](index=283&type=chunk) - Key growth strategies include cost-effectively expanding the customer base, increasing customer spending through its multi-channel approach and eCash loyalty program, investing in technology, and pursuing strategic acquisitions[310](index=310&type=chunk)[313](index=313&type=chunk)[314](index=314&type=chunk)[315](index=315&type=chunk)[316](index=316&type=chunk) - The company faces significant legal and regulatory challenges, including ongoing arbitration and a criminal complaint related to the ATB acquisition, and multiple tax investigations from Indian authorities[358](index=358&type=chunk)[359](index=359&type=chunk)[375](index=375&type=chunk)[377](index=377&type=chunk) [Organizational Structure](index=83&type=section&id=C.%20Organizational%20Structure) Yatra Online, Inc., a Cayman Islands company, is the parent entity with key subsidiaries in India, Cyprus, and the USA, managing its diverse travel service operations - The organizational chart shows Yatra Online, Inc. (Cayman Islands) as the parent company with a network of subsidiaries primarily located in India, Cyprus, and the USA[410](index=410&type=chunk) [OPERATING AND FINANCIAL REVIEW AND PROSPECTS](index=83&type=section&id=Item%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section analyzes Yatra's financial condition and operations, detailing the impact of the Ebix merger and acquisitions, presenting key metrics like **INR 111.1 billion Gross Bookings** and **INR 8.9 billion Adjusted Revenue** in FY19, and discussing liquidity and cash flows [Results of Operations](index=98&type=section&id=Results%20of%20Operations) In FY2019, total revenue decreased **23.6% to INR 9,358.6 million** due to IFRS 15, while Adjusted Revenue grew **20.3% to INR 8,911.0 million**, and the **net loss narrowed to INR 1,193.6 million** primarily due to a gain on warrants Fiscal Year 2019 vs. 2018 Performance (INR in millions) | Metric | FY 2018 (INR millions) | FY 2019 (INR millions) | Change | Reason for Change | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | 12,248.5 | 9,358.6 | (23.6%) | Adoption of IFRS 15, reclassifying promotional costs | | **Adjusted Revenue** | 7,407.8 | 8,911.0 | 20.3% | Growth in Air Ticketing, Hotels & Packages, and Other segments | | **Marketing Expenses** | 4,153.9 | 810.0 | (80.5%) | Reclassification of promotional costs to revenue under IFRS 15 | | **Loss for the Year** | (4,052.0) | (1,193.6) | 70.6% | Reduced operating loss and a significant gain on the fair value of warrants | - Adjusted Revenue from Air Ticketing increased **13.9%** in FY2019, driven by a **23.3% increase in gross bookings**, though Net Revenue Margin decreased from **6.3% to 5.8%** due to business mix and Jet Airways' cessation[517](index=517&type=chunk)[518](index=518&type=chunk) - Adjusted Revenue from Hotels and Packages grew **10.8%** in FY2019, with an **11.6% increase in standalone hotel room nights**, and Net Revenue Margin improved to **14.0% from 12.7%** due to favorable business mix[520](index=520&type=chunk) - Personnel expenses decreased by **12.1%** in FY2019, primarily due to a significant reduction in employee share-based payment expenses from **INR 729.9 million** in FY2018 to **INR 282.9 million** in FY2019[524](index=524&type=chunk) [Liquidity and Capital Resources](index=104&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is supported by **INR 2,161.0 million in cash** and **INR 1,029.5 million in term deposits** as of March 31, 2019, despite **net cash used in operating activities increasing to INR 3,542.1 million** in FY2019 due to working capital changes Cash and Liquidity Position (INR in millions) | As of March 31, | 2018 (INR millions) | 2019 (INR millions) | | :--- | :--- | :--- | | Cash and cash equivalents | 2,465.1 | 2,161.0 | | Term deposits | 1,012.1 | 1,029.5 | | Pledged term deposits | 831.7 | 1,010.3 | Summary of Cash Flows (INR in millions) | Fiscal Year Ended March 31, | 2018 (INR millions) | 2019 (INR millions) | | :--- | :--- | :--- | | Net cash used in operating activities | (881.9) | (3,542.1) | | Net cash from/(used in) investing activities | 1,221.1 | (650.3) | | Net cash from financing activities | 577.2 | 2,904.6 | - The significant increase in cash used in operations in FY2019 was primarily due to a working capital increase of **INR 2,217.2 million**, driven by a **INR 1,316.4 million** rise in trade receivables and a **INR 920.9 million** decrease in trade payables[583](index=583&type=chunk) - The company made capital expenditures of **INR 874.9 million** in fiscal year 2019 and expects to spend an additional **INR 200 million to INR 300 million** in fiscal year 2020, primarily on technology infrastructure and platform upgrades[592](index=592&type=chunk) [DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](index=115&type=section&id=Item%206.%20DIRECTORS,%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section details Yatra's board and senior management, including CEO Dhruv Shringi and the impending CFO resignation, executive compensation of **INR 103.0 million** in FY2019, equity incentive plans, board practices, and significant share ownership [Directors and Senior Management](index=115&type=section&id=A.%20Directors%20and%20Senior%20Management) The company's leadership includes co-founder Dhruv Shringi as CEO, with Alok Vaish as CFO and Manish Amin as CIO, noting the impending resignation of CFO Alok Vaish effective mid-October 2019 - The executive team is led by co-founders Dhruv Shringi (CEO) and Manish Amin (CIO), along with Alok Vaish (CFO)[631](index=631&type=chunk)[632](index=632&type=chunk)[633](index=633&type=chunk) - Chief Financial Officer Alok Vaish has informed the company of his intention to resign effective mid-October 2019[632](index=632&type=chunk) [Compensation](index=118&type=section&id=B.%20Compensation) Non-executive directors receive a **$15,000 annual fee**, while aggregate compensation for executive director and senior management was **INR 103.0 million** in FY2019, excluding equity, with various stock options and RSUs granted under two equity incentive plans - Aggregate compensation for the executive director and senior management for the year ended 2019 was **INR 103.0 million**, excluding equity compensation[643](index=643&type=chunk) - The company has two main equity plans, the 2006 Plan and the 2016 Plan, with **614,418 options outstanding** as of March 31, 2019, and a significant portion of RSUs having deferred vesting until October 31, 2019[644](index=644&type=chunk)[653](index=653&type=chunk)[658](index=658&type=chunk)[664](index=664&type=chunk)[666](index=666&type=chunk) [Board Practices](index=122&type=section&id=C.%20Board%20Practices) The board of directors consists of six members, with a majority independent and divided into three staggered classes, supported by Audit, Compensation, and Nominating and Corporate Governance committees, adhering to home country governance practices as a foreign private issuer - The board is comprised of **six directors** and is divided into three staggered classes (Class I, II, and III), with each class serving a three-year term[673](index=673&type=chunk)[675](index=675&type=chunk)[683](index=683&type=chunk) - The board has three primary committees: Audit, Compensation, and Nominating and Corporate Governance, with all audit committee members being independent and Murlidhara Kadaba designated as the 'audit committee financial expert'[680](index=680&type=chunk)[681](index=681&type=chunk)[685](index=685&type=chunk)[688](index=688&type=chunk) [Share Ownership](index=126&type=section&id=E.%20Share%20Ownership) As of March 31, 2019, major shareholders include entities affiliated with **Nathan Leight (15.18%)**, **Macquarie Group Limited (12.43%)**, and **Altai Capital Management, LLC (10.01%)**, with all directors and officers collectively holding **4.73%** of outstanding shares Major Shareholders (as of March 31, 2019) | Name of Beneficial Owner | Percentage of Outstanding Shares | | :--- | :--- | | Entities Affiliated with Nathan Leight | 15.18% | | Macquarie Group Limited | 12.43% | | Entities Affiliated with Altai Capital Management, LLC | 10.01% | | RCH Ltd. | 7.55% | | Reliance Infrastructure Limited | 6.43% | | Entities Affiliated with Vincent C. Smith | 5.95% | | E-18 Limited & Capital18 Fincap Private Limited | 5.38% | | Entities Affiliated with Norwest Venture Partners | 5.16% | | All directors and officers as a group (8 persons) | 4.73% | [MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](index=130&type=section&id=Item%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section details major shareholders and significant related party transactions, including an Investor Rights Agreement granting registration and board nomination rights, an exchange agreement for Yatra USA Class F shares, and service agreements with influential entities - The company has an Investor Rights Agreement granting certain shareholders demand and "piggy-back" registration rights, along with rights to nominate directors and designate board observers[713](index=713&type=chunk)[714](index=714&type=chunk) - An exchange and support agreement allows holders of Yatra USA Class F Shares to exchange them for the company's Ordinary Shares on a one-for-one basis, a right effective from November 16, 2017, until December 16, 2021[716](index=716&type=chunk) - The company engages in arm's length transactions with related parties, including providing and availing travel services to and from entities with significant influence, such as Reliance group companies[715](index=715&type=chunk) [FINANCIAL INFORMATION](index=133&type=section&id=Item%208.%20FINANCIAL%20INFORMATION) This section refers to consolidated financial statements, highlights ongoing legal proceedings regarding the ATB acquisition and tax matters, and states no current plans for dividend payments, intending to retain earnings for business expansion - The company is involved in significant arbitration proceedings with ATB sellers over the final acquisition payment, alongside a related criminal complaint deemed false and frivolous[724](index=724&type=chunk)[727](index=727&type=chunk)[728](index=728&type=chunk) - The company has no current plans to pay dividends on its Ordinary Shares, expecting to retain all future earnings for business operations and expansion[730](index=730&type=chunk) [ADDITIONAL INFORMATION](index=135&type=section&id=Item%2010.%20ADDITIONAL%20INFORMATION) This section covers exchange controls and taxation, outlining Indian regulations affecting foreign ownership and dividend payments, and detailing U.S. and Indian tax consequences for shareholders, including potential Indian capital gains tax on share sales (short-term at **40%**, long-term at **10%**) due to substantial Indian assets [Exchange Controls](index=135&type=section&id=D.%20Exchange%20Controls) The company's operations are subject to Indian exchange controls (FEMA and FDI policy), which may restrict investments and impact dividend payments from its Indian subsidiary, Yatra India, subject to Indian law and dividend distribution tax - India's Foreign Exchange Management Act (FEMA) and Foreign Direct Investment (FDI) policy regulate foreign ownership and may adversely affect the company's ability to make investments in India[740](index=740&type=chunk)[741](index=741&type=chunk) - The ability to pay dividends to shareholders depends on receiving dividends from the Indian subsidiary, Yatra India, which are subject to Indian legal restrictions, including a **15.0% dividend distribution tax** plus cess and surcharge[743](index=743&type=chunk) [Taxation](index=137&type=section&id=E.%20Taxation) This subsection details U.S. and Indian tax consequences for shareholders, including the company's expected foreign corporation status (not PFIC/CFC) for U.S. tax, and potential Indian capital gains tax on share sales (short-term at **40%**, long-term at **10%**) due to substantial Indian assets - For U.S. tax purposes, the company believes it should be treated as a foreign corporation under Section 7874 of the IRC, though this is subject to complex rules and potential IRS challenge[758](index=758&type=chunk)[761](index=761&type=chunk) - The company does not expect to be classified as a Passive Foreign Investment Company (PFIC) for the current taxable year, but this determination is made annually and is subject to uncertainty[778](index=778&type=chunk) - Gains from the sale of the company's shares may be subject to Indian income tax due to substantial value derived from Indian assets, with long-term capital gains taxed at **10%** and short-term gains at **40%** for foreign companies, plus surcharges[798](index=798&type=chunk)[799](index=799&type=chunk)[805](index=805&type=chunk)[807](index=807&type=chunk) [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=148&type=section&id=Item%2011.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to credit risk from trade receivables, liquidity risk managed by maintaining sufficient cash and credit facilities, and foreign currency risk from transactions in non-functional currencies - The company is exposed to credit risk from operating activities, primarily trade receivables from customers and suppliers[817](index=817&type=chunk) - Liquidity risk is managed by maintaining adequate cash reserves and banking facilities, with current resources believed sufficient for at least the next 12 months[819](index=819&type=chunk)[822](index=822&type=chunk) - Foreign currency risk arises from transactions denominated in currencies other than the functional currencies of its subsidiaries in India, Singapore, and the United States, and the company does not currently use hedging agreements[823](index=823&type=chunk) [PART II](index=149&type=section&id=PART%20II) [CONTROLS AND PROCEDURES](index=150&type=section&id=Item%2015.%20CONTROLS%20AND%20PROCEDURES) Management, including the CEO and CFO, concluded that the company's disclosure controls and internal control over financial reporting were effective as of March 31, 2019, with the assessment excluding the recently acquired TCIL - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of March 31, 2019[833](index=833&type=chunk) - Management concluded that the company's internal control over financial reporting was effective as of March 31, 2019, with the assessment excluding the newly acquired Travel.Co.In Limited (TCIL) as permitted by the SEC[837](index=837&type=chunk)[838](index=838&type=chunk) - As an "emerging growth company," Yatra is not required to provide an auditor attestation report on its internal control over financial reporting[839](index=839&type=chunk) [PART III](index=153&type=section&id=PART%20III) [FINANCIAL STATEMENTS](index=154&type=section&id=Item%2018.%20FINANCIAL%20STATEMENTS) This section contains the audited consolidated financial statements of Yatra Online, Inc. for fiscal years 2017-2019, prepared in accordance with IFRS, and includes an unqualified auditor's opinion from Ernst & Young Associates LLP - The independent auditor, Ernst & Young Associates LLP, issued an unqualified opinion on the consolidated financial statements, affirming fair presentation of financial position and results of operations in conformity with IFRS[873](index=873&type=chunk) Consolidated Statement of Profit or Loss (INR in thousands) | For the year ended March 31, | 2017 (INR thousands) | 2018 (INR thousands) | 2019 (INR thousands) | | :--- | :--- | :--- | :--- | | **Total revenue** | 9,356,813 | 12,248,513 | 9,358,580 | | **Results from operations** | (1,863,415) | (3,360,133) | (2,578,199) | | **Loss for the year** | (5,936,963) | (4,051,976) | (1,193,595) | | **Total comprehensive loss for the year** | (5,900,106) | (4,066,715) | (1,203,955) | Consolidated Statement of Financial Position (INR in thousands) | As of March 31, | 2018 (INR thousands) | 2019 (INR thousands) | | :--- | :--- | :--- | | **Total assets** | 11,616,787 | 12,551,897 | | **Total liabilities** | 11,842,066 | 10,172,727 | | **Total equity** | (225,279) | 2,379,170 |

Yatra Online, Inc. (NASDAQ:YTRA) Q4 2019 Earnings Conference Call July 23, 2019 8:30 AM ET Company Participants Manish Hemrajani - Head-Investor Relations Dhruv Shringi - Chief Executive Officer and Co-Founder Alok Vaish - Chief Financial Officer Conference Call Participants Jed Kelly - Oppenheimer Andrew Carreon - University of Notre Dame Operator Good day, and welcome to the Yatra Fourth Quarter 2019 Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference o ...

Financial Data and Key Metrics Changes - Adjusted revenue grew by 16.6% year-over-year to INR 2.3 billion or $33.5 million [28] - Adjusted EBITDA loss improved by 60% year-over-year to INR 154 million or $2.2 million [35] - Cash position as of December 31, 2018, was INR 3.8 billion or approximately $54.5 million [36] Business Line Data and Key Metrics Changes - Air Ticketing adjusted revenue increased by 5.7% to INR 1.5 billion or $20.8 million, driven by a 13.4% increase in gross bookings to INR 23 billion or $333 million [29] - Hotels and Packages adjusted revenue grew by 10.5% year-over-year to INR 483 million or $6.9 million, despite gross bookings decreasing by 8% [31] - Standalone hotel room nights booked increased by 19.2% year-over-year [28] Market Data and Key Metrics Changes - Overall air traffic was up 12% year-over-year, with air gross bookings up 13.4% [10] - Corporate travel in India is projected to grow at an annual rate of over 12% through 2020, making it the fastest-growing corporate travel market in the world [19] Company Strategy and Development Direction - The company aims for at least 20% adjusted revenue growth in the current fiscal year and a meaningful year-over-year improvement in adjusted EBITDA loss [8] - A unique strategy of creating a symbiotic relationship between business and leisure travel is emphasized to capture higher spending and loyalty from business travelers [8] - The integration of ATB acquisition is progressing ahead of plan, with expectations of cost synergies starting next quarter [7] Management's Comments on Operating Environment and Future Outlook - Management is optimistic about the prospects in India's rapidly expanding travel industry and believes they are well-positioned for growth [8] - The aviation macro trends are expected to remain favorable due to lower aircraft penetration and government support [10] - Management acknowledges that while profitability is a focus, achieving positive free cash flow may take longer, potentially into 2021 [45] Other Important Information - The company signed a partnership with Agoda to power their hotel inventory for domestic India hotels, expected to enhance global traveler demand [16] - Marketing and sales promotion expenses decreased to 48% of adjusted revenue from 52% in the previous year [25] Q&A Session Summary Question: Can you provide insights on profitability goals for the next 12 to 24 months? - Management indicated a focus on improving the bottom line and expects to be closer to breakeven or marginal profitability in 2020, with free cash flow profitability anticipated in 2021 [45] Question: Did your corporate travel segment outgrow the industry? - Management clarified that the 12% growth rate is a projection for the industry, and while current growth may have been impacted by one-time factors, underlying growth rates would be healthy [46] Question: How do you plan to leverage marketing expenses in the leisure travel environment? - Management expressed confidence in leveraging marketing expenses through repeat buying patterns and converting corporate travelers into leisure travelers [50] Question: What is the expected impact of the PL Worldways acquisition? - Management expects the acquisition to be accretive from day one, with operating margins between 35% to 50% [55] Question: How is the Agoda partnership expected to impact EBITDA? - Management confirmed that the partnership would positively impact the bottom line from day one, with expectations of healthy volume growth [57] Question: Can you elaborate on the decision to outsource the call center? - Management explained that the decision was based on the development of automation tools and tight monitoring with vendors to ensure service quality [66] Question: What was the rationale behind dropping certain low-margin customers? - Management indicated that the decision was based on compliance with tax regulations and the desire to avoid carrying tax liabilities [72] Question: How has the partnership with OYO impacted growth? - Management noted that the impact on leisure travel from the partnership has been marginal, with limited incremental growth observed [89]