Urban Company's FY23 loss reduces to Rs 308 cr from Rs 514 cr in FY22

The home services marketplace said that its revenue from operations grew 45 % year-over-year from Rs 438 crore in FY22 to Rs 637 crore in FY23

Home services marketplace Urban Company has reported that its revenue from operations grew by 45 per cent year-on-year, from Rs 438 crore in FY22 to Rs 637 crore in FY23. Losses before taxation (as per Indian accounting standards) decreased from Rs 514 crore to Rs 308 crore, while the adjusted Ebitda loss was trimmed from Rs 377 crore to Rs 297 crore.

The company attributes the growth in FY23 to investments in various areas including service quality, partner training and enablement, innovations, brand building, and technology development.

"We saw steady business growth with revenue from operations (consolidated) growing by 45 per cent, from Rs 438 crore in FY22 to Rs 637 crore in FY23," the company stated. "We also made meaningful progress towards improving profitability driven by operational leverage in fixed costs and driving efficiency across other costs. Losses for the year declined from Rs 514 crore in FY22 to Rs 308 crore in FY23."

A breakdown shows that service revenue increased from Rs 347 crore in FY22 to Rs 496 crore in FY23, and product revenue rose from Rs 91 crore to Rs 141 crore.

Urban Company's India business broke even on an adjusted Ebitda basis during Q1 FY24, with negative working capital. In the India business, the firm posted net revenue of Rs 574 crore in FY23, up from Rs 395 crore in FY22. The total loss was reduced to Rs 177 crore in FY23, compared to Rs 419 crore in FY22.

"Our India business contributes approximately 90 per cent of our revenues. We remain focused on improving profitability for India and UC as a whole. Our strong unit economics with focused cost control will help us drive Ebitda improvement as the business scales," said the company.

Overall, Urban Company stated that its net transaction value was Rs 2,825 crore, and it had 5.3 million transacting users. During FY23, customers on average rated the services at 4.82 out of 5.0 across millions of ratings collected on its apps, with more than 17 million services rated 5-stars by the customers. Repeat customers, those acquired in years prior to FY23, contributed about 77 per cent of the Net Transaction Value of the platform during FY23. "We expect this number to surpass 90 per cent in the coming years," the firm added.

The company also highlighted its commitment to training, having invested over Rs 250 crore since inception in training and upskilling partners. According to the latest Partner Earnings Index for H1 CY23, service partners continue to benefit from increased earnings, with the top 20 per cent earning an average of about Rs 40,000 per month, net of all related costs.

Additionally, Urban Company has formed an industry-first Partner Stock Option Plan (PSOP). "In FY23, we granted stocks to 500 service partners, of whom 30 per cent were women," said the firm.

In terms of corporate governance, the company added three independent board members to the UC Board: Dr Ashish Gupta, Ireena Vittal, and Shyamal Mukherjee.

• Revenue from operations grew 45% YoY: From Rs 438 cr in FY22 to Rs 637 cr in FY23
• Losses before taxation (Ind AS) reduced from Rs 514 cr. to Rs 308 cr.
• Adjusted EBITDA loss reduced from Rs 377 cr to Rs 297 cr.
• India business broke even at Adjusted EBITDA level for the quarter ended Q1 FY24
• 77% of the business comes from repeat customers (Acquired in years prior to FY23)
• Top 20% of partners earned an average of Rs 40,000 per month, net of all commissions and other related costs (Travel, product expenses etc.) in H1 CY23
• The average net earnings of partners delivering >30 services per month were Rs 32,000