The parent company of major edtech company Byju's, Think and Learn Pvt. Ltd, reported that the company changed its accounting standard, which delayed the recognition of revenues, and that this caused its loss to increase significantly to 4,588.75 crore from 231.69 crore in the prior year.
“If this can’t break us, nothing will,” said Byju Raveendran, Founder and CEO of India's most-valued startup Byju's, as he revealed his company's FY21 (2020-21) financials after a year-long wait.
Byju’s revenue fell over 3% year on year to Rs. 2,428 crore on a consolidated basis down from Rs 2,511 crore the previous year, according to the FY21 results. In the financial year of 2021, Byju’s reported a Rs 4,589 crore loss, nearly 20 times the adjusted loss of Rs 231.69 crore loss in FY20 (2019-20).
Raising hopes for the subsequent year, 2021-22, the company disclosed unaudited results that show nearly Rs 10,000 crore in gross revenues. Its K-12 education business is showing rapid growth. The firm said it logged revenues of Rs 4,530 crore between April and July this year.
Byju Raveendran told Moneycontrol that the company had a revenue of Rs 2,511 crore in FY20, despite the company's FY20 filings with the MCA showing that it had reported a revenue of Rs 2,704 crore due to adjustments in its revenue recognition. Byju's has not yet formally submitted its FY21 results to the MCA. Byju's adjusted loss for FY20 was also reduced from an earlier estimate of Rs 262 crore.
A significant increase in business was not reflected in the revenue figure even after changes in accounting practices. And nearly 40 percent of the revenue was deferred to subsequent years, according to Byju's.
“During COVID, we gave streaming access to a lot of our users because of shipment delays. (Byju's also sells Tablets and SD cards as a part of its subscription) And that had to be changed. The revenue had to be recognised across the period of consumption,” Raveendran said in a virtual interaction.
“Secondly, on account of credit sales, EMI (equated monthly instalments) sales, recognition was based on significant collection of that. Revenue was recognised after completion of collection. These were the two additional changes that had to be made,” he added.
Despite the fact that Byju's is a privately held company, its financial results received more attention as a result of Deloitte's alleged delay in endorsing them. Deloitte had raised some questions about how Byju's was accounting for its revenue, which caused the edtech behemoth's results to be submitted to the MCA later than planned (Ministry of Corporate Affairs). At least four deadlines had been set by Byju's for submitting its findings to the MCA, but none had been met.
Since the beginning of this year, Byju's has experienced difficulties. Byju's has fired nearly 2,500 workers in an effort to cut costs. In addition, despite announcing several investment rounds since September of last year, the company has not yet received $250 million from those rounds.
Byju's has also been considering an IPO, and reportedly, it was looking to list this year.
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