Covid-19 eats up over 60% of BlackBuck income in FY21

Around mid 2019, trucking and logistics platform BlackBuck had established itself as one of India’s largest trucking platforms claiming to service over 1500 clients including the likes of Tata Steel, Reliance Industries and Amul, to name a few. However, the operational challenges during the covid period seem to have been a major reason for its scale diminishing during the fiscal ended March 2021.

To understand the details behind its operations, Fintrackr has analyzed the Bengaluru-based unicorn's annual statements filed with MCA. In FY21, BlackBuck has seen its revenue deplete by 61%. It has recorded operating revenue of Rs 866.73 crore during FY21 from the pre covid high of Rs 2,235.7 crore in FY20.

The Tiger Global and B Capital-backed company provides a tech platform to connect existing goods transport operators with businesses and enables intercity logistics services to companies. Around 93.3% of its revenue comes from contract trucking services, whose collection dropped by 63.5% to Rs 808.51 crore during FY21 from Rs 2,215.4 crore collected in FY20.

The company also provides telematics services of live tracking of all the trucks to the clients, monitoring their shipment all through. BlackBuck also has tie-up arrangements with marketers of petroleum products and banks where it acts as an agent for distribution and management of radio frequency identification (RFID) tags and collects a commission. These ancillary services brought in the remaining 6.7% of the operating revenue, growing nearly three folds to Rs 58.2 crore in FY21 from Rs 20.3 crore earned during FY20.

Besides operational income, BlackBuck also earned Rs 26.5 crore from its financial assets during the last fiscal year (FY21).

BlackBuck is solely responsible for rendering the transport service to its customers and pays lorry hire charges to truck owners for their service and these payments are the single largest cost for the company, making up 70.2% of the annual expenses. Thus, in step with diminished scale of operations, these expenses dropped by 64% to Rs 797.04 crore during FY21 from Rs 2,207.8 crore in FY20.

During the year, BlackBuck also shed employees, letting go around 200 employees at the start of FY21. As a result, employee costs reduced by 31.4% to Rs 121.4 crore in FY21 from Rs 177 crore in FY20. These costs accounted for 10.7% of its annual expenses.

On similar lines, its training and recruitment costs also dropped by 28.2% to Rs 29.7 crore in FY21 from Rs 41.4 crore in the preceding fiscal year. Further, IT and communications costs also went down by 45.7% YoY to Rs 14.5 crore during FY21.

BlackBuck achieved the unicorn milestone towards the end of FY21 after raising a $67 million Series E round led by Trice Capital. During the fiscal, the company has paid back borrowing amounting to over Rs 191 crore and its finance costs dropped 21.7% YoY to Rs 52.3 crore.

Overall, the company’s annual expenditure dropped by 58.6% to Rs 1,134.6 crore in FY21 from Rs 2,741.7 crore spent in total during FY20. Thus, BlackBuck spent Rs 1.31 to earn a single rupee of operating revenue during FY21.

BlackBuck has managed to cut costs due to diminished scale of operations and reduced trucking contracts in the previous fiscal, but its EBITDA margin worsened by 350 BPS to -19.9% in FY21 from -16.4% during FY20.

Annual losses were also reduced by 46.6% YoY to Rs 241.4 crore in FY21 and its balance sheet sported outstanding losses of Rs 1,257.4 crore at the end of March 2021. The firm has truly been on the wrong side of the Covid impact scale, and with normalcy returning, will hope to catch up and overtake its 2020 numbers soon.