Debt investors: audited financial results on September 6, Byju’s informs debt investors

Edtech major Byju’s has advised its debt investors that it is likely to finalize its FY21 audited financial results, approved by auditor Deloitte, by September 6, people briefed on the matter said.

The online education company had scheduled a call with investors earlier this month but had to postpone it citing a delay in the formal closing of audited financial reports.

Byju’s is expected to hold its board meeting next week once it receives the final report which will be presented to the directors.

The development comes after the Ministry of Corporate Affairs (MCA) asked Think & Learn, Byju’s parent company, the reasons for the 17-month delay in filing its audited accounts.

ETtech

People familiar with the matter said Bengaluru-based Byju’s told its bond investors, such as bondholders, that the finances would be unqualified. This means that there are no separate comments on the audited figures that will be presented by the company.

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“Byju’s recently communicated on a Sept. 6 call with investors, but they emphasized it is without comment and has been cleared by the auditor,” a person briefed on the matter said.

Another person said, “Byju’s always kept a buffer for a few days between the board meeting and the investor call.”

Recognition of the edtech major’s revenue has been the point of contention between the company and Deloitte, according to several people in the know.

The company would have moved a portion of revenue recognized in FY21 to FY22 in accordance with auditor recommendations citing Ind AS 115 rules, they said.

In an interview with ET in May, the company’s founder, Byju Raveendran, said the delay in filing its financial statements was due to the multiple acquisitions the company had made.

The fully audited financial statements will be shared with Byju’s board of directors and then shared with debt investors and other stakeholders, the company said, according to the people quoted above.

Currently, Byju’s is the highest valued private Indian startup with $22 billion.

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Raveendran had said the company was aiming to close FY23 with revenue of around Rs 17,000 crore. It had recorded operating income of Rs 2,381 crore in FY20 compared to Rs 1,306 crore in FY19, according to regulatory filings. Its consolidated loss widened to Rs 262 crore in financial year 2020 from Rs 8.9 crore a year earlier.

Emails sent to Byju’s and Deloitte India did not elicit a response before press time on Sunday.

Byju’s, which spent more than $2.5 billion on acquisitions last year, took on debt to fund potential M&A deals underway. Raveendran, according to the company, invested $400 million in personal capital arranged through debt from financial investors. It was part of an $800 million funding round, first announced in March, but which has yet to close. About $250 million in capital is expected to arrive by the end of the month, according to previous company statements. Investors like Oxshott Capital and Sumeru Ventures have yet to put their capital into the startup. Byju raised a $1.2 billion term loan last November.

According to reports, Raveendran was also close to closing $2.4 billion in funding from JP Morgan for a potential acquisition of U.S. education technology company 2 U. dollars…that’s why we access all kinds of capital. We’re exploring acquisitions in the United States,” Raveendran told ET in May.

On July 4, the company had issued a statement indicating that it would publish its financial statements within the next 10 days.

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Carol M. Barragan