Yandex (NASDAQ and MOEX: YNDX), one of Europe's largest internet
companies and the leading search and ride-hailing provider in
Russia, today announced its unaudited financial results for the
third quarter ended September 30, 2020.
Reorganization of Yandex.Market &
Yandex.Money JVs and Restructuring of MLU
B.V.
On July 23, 2020 Yandex and Sberbank closed the transactions to
reorganize their two Joint Ventures – Yandex.Market and
Yandex.Money. As a result, Yandex became the controlling
shareholder in Yandex.Market and its financial results have been
consolidated in Yandex’s consolidated statements from this date.
Prior to that, we recorded our share of Yandex.Market’s financial
results within the income/(loss) from equity method investments
line in the consolidated statements of income (from April 27, 2018,
when Yandex and Sberbank formed a joint venture based on the
Yandex.Market platform). In addition, Yandex exited the
Yandex.Money JV and, therefore, its financial results are no longer
accounted for within the income/(loss) from equity method
investments line in the consolidated statements of income.
In September 2020, we completed restructuring of MLU B.V., our
Ride-Hailing and FoodTech Joint Venture with Uber, contributing our
Yandex.Drive business to the JV and spinning-off the self-driving
vehicles business, Yandex Self Driving Group (“Yandex SDG”).
Therefore, this financial release presents:
Consolidated financial
results, which include consolidated financial
results of Yandex.Market for 69 days after the reorganization and
our share of Yandex.Market’s financial results prior to July 23,
2020. Financial results on a like-for-like basis
excluding Yandex.Market
(1), which completely exclude the
results of Yandex.Market post the consolidation, gain from
consolidation of Yandex.Market and loss from equity method
investments associated with Yandex.Market for the period prior the
consolidation from the three and nine months periods ended
September 30, 2019 and 2020. Financial results of
Yandex.Market on a comparable basis, which
present the standalone financial results of Yandex.Market for the
three and nine months periods ended September 30, 2019 and
2020.
(1) These measures presented in this release are “non-GAAP
financial measures”. Please see the section headed “Use of Non-GAAP
Financial Measures” below for a discussion of how we define these
measures, as well as reconciliations at the end of this release of
each of these measures to the most directly comparable U.S. GAAP
measures.
Q3 2020 Financial Highlights
(2)
Q3 2020 consolidated financial
results
- Revenues of RUB 58.3 billion
($732.1 million), up 30% compared with Q3 2019
- Net income of RUB 21.9
billion ($275.0 million), up 356% compared with net income of RUB
4.8 billion in Q3 2019; net income
margin of 37.6%
- Adjusted net income of
RUB 7.6 billion ($96.0 million), up 11% compared with Q3 2019;
adjusted net income margin of
13.1%
- Adjusted EBITDA of RUB 15.1
billion ($189.4 million), up 8% compared with Q3 2019;
adjusted EBITDA margin of
25.9%
Q3 2020 financial results on a like-for-like
basis excluding Yandex.Market in 2019 and
2020
- Revenues of RUB 53.7 billion
($674.0 million), up 19% compared with Q3 2019
- Net income of RUB 4.7
billion ($58.5 million), down 20% compared with net income of RUB
5.8 billion in Q3 2019; net income
margin of 8.7%
- Adjusted net income of
RUB 9.4 billion ($117.4 million), up 18% compared with Q3
2019; adjusted net income margin
of 17.4%
- Adjusted EBITDA of RUB 16.2
billion ($203.0 million), up 16% compared with Q3 2019;
adjusted EBITDA margin of
30.1%
Cash, cash equivalents and term deposits as of
September 30, 2020:
- RUB 251.9 billion ($3,161.1 million) on a consolidated
basis
- Of which RUB 30.5 billion ($382.7 million) is related to Taxi
segment
- Of which RUB 16.8 billion ($210.8 million) is related to
E-commerce segment
(2) Pursuant to SEC rules regarding convenience translations,
Russian ruble (RUB) amounts have been translated into U.S. dollars
at a rate of RUB 79.6845 to $1.00, the official exchange rate
quoted as of September 30, 2020 by the Central Bank of the Russian
Federation.
Q3 2020 Operational and Corporate
Highlights
Search
- Share of Russian search
market, including mobile, averaged 59.3% in Q3
2020, up from 56.6% in Q3 2019 and down from 59.6% in Q2 2020,
according to Yandex.Radar
- Search share on Android in
Russia was 58.7% in Q3 2020, up from 52.8% in Q3 2019 and 57.5% in
Q2 2020, according to Yandex.Radar
- Mobile search traffic was
62.7% of our total search traffic in Q3 2020. Mobile revenues
represented 52.8% of our search revenues in Q3 2020
- Search queries in Russia grew
13% compared with Q3 2019
- Paid clicks on Yandex’s and
its partners’ websites, excluding clicks of Yandex.Market,
increased 14% compared with Q3 2019
- Average cost per click,
excluding clicks of Yandex.Market, decreased 12% compared with Q3
2019
Business Units and
Experiments
- Number of
rides in the Taxi service
increased 24% year-on-year compared with Q3 2019
- Number of
dark stores in Yandex.Lavka
service reached 234 stores as of the end of
September 2020
- The share of
gross merchandise value (“GMV”)
(3) sold by
third-party sellers on our Yandex.Market
marketplace reached 60% in Q3 2020
-
Marketplace’s assortment reached
1.4 million SKUs as of the end of Q3 2020
- Number of
Media Services subscribers was
5.6 million as of the end of Q3 2020, up 121% from the end of Q3
2019
-
Zen's daily average users reached
18.2 million in September 2020, up 45% from September 2019
(3) GMV is value of delivered (and settled by customers) orders
recognized on the date of delivery in their final prices including
VAT.
Corporate
- On July 23, 2020,
Yandex and Sberbank have completed the reorganization of their
Joint Ventures – Yandex.Market and Yandex.Money. As a result of
these transactions, Yandex now owns 100% of Yandex.Market, with an
equity incentive pool set aside for Yandex.Market management. In
addition, Yandex has exited the Yandex.Money Joint Venture.
Yandex.Money service will be rebranded by the end of 2020.
- On October 1, 2020,
we integrated the Yandex.Market price comparison platform with the
Beru marketplace under the Yandex.Market brand umbrella.
- On September 9,
2020, Yandex and Uber completed the spin off of the self-driving
vehicles business, Yandex SDG, from their Ride-Hailing and FoodTech
Joint Venture. Simultaneously with the spin off transaction, Yandex
invested a further $100 million in the form of equity and will
invest $50 million in the form of a convertible loan in Yandex SDG.
Yandex also purchased a portion of Uber’s stake in Yandex SDG. On
September 22, 2020 Yandex contributed the Yandex.Drive car-sharing
business from Yandex to MLU B.V. Following these transactions,
Yandex SDG is now directly owned by Yandex and Uber with respective
ownership of 72.8% and 18.6%, while the remaining 8.6% is reserved
for Yandex SDG management and employees. MLU B.V., including the
Drive business, is now owned by Yandex and Uber with their
respective ownership of 61.7% and 33.5%, while the remaining 4.8%
is reserved for management and employees of the MLU business.
“The third quarter turned out to be better for us than initially
expected, with many businesses demonstrating recovery both in terms
of revenue growth and profitability,” said Tigran Khudaverdyan,
Deputy Chief Executive Officer of Yandex. “With Yandex.Market back
under our full operating control, we have increased our focus on
deepening its integration with Yandex to further enhance our
customer proposition. One of the key enablers of this integration
is our cross-service loyalty program Yandex.Plus, which recently
reached 5 million subscribers in Russia. In addition, we are
currently actively exploring a number of strategic options to build
a FinTech vertical with a particular focus on payments and digital
finance services for consumers and SMEs. We believe all of these
initiatives will strengthen our ecosystem strategy and support
Yandex’s long-term growth potential.”
“We delivered a solid set of results this quarter,” said Greg
Abovsky, Chief Operating Officer and Chief Financial Officer of
Yandex. “I am especially pleased with the strong profitability in
our key businesses, which is a function of improved operational
efficiency and cost optimization. We have further expanded the list
of businesses generating positive Adjusted EBITDA beyond
advertising and ride-hailing, and we are seeing improved unit
economics across many verticals. We plan to maintain a conservative
approach to costs and hiring until there is greater clarity on the
macroeconomic and pandemic situation, while continuing to invest in
a number of strategic opportunities with the support of our strong
balance sheet.”
Impact of the COVID-19
Pandemic
Though the COVID-19 pandemic continued to have a material impact
on our financial results and operations in Q3 2020, we have seen
improved financial performance across our key businesses, including
online advertising and ride-hailing, as well as classifieds and
car-sharing. This was primarily driven by the lifting of strict
lockdown restrictions on the back of the decreased number of COVID
cases (both in the capital cities and the regions), which in turn
led to some recovery of economic activity and mobility. The
businesses that saw an acceleration of demand during the pandemic,
continued to demonstrate strong growth trends, including our
FoodTech businesses, Media Services and Yandex.Market marketplace.
We believe this is related to the change in consumer behavior and
habits, and low penetration of these services in Russia.
The number of new COVID-19 cases in Russia started to grow again
in September and in October already surpassed the May peak. As a
result, we have seen some slowdown in the pace of recovery of our
core advertising as well as mobility businesses (ride-hailing and
car-sharing) in the first weeks of October. The performance in the
upcoming months will highly depend on the epidemiological situation
in Russia and potential new lockdown restrictions.
With regards to our financial position as of September 30, 2020,
our analysis of the effect of COVID-19 on goodwill, non-current
assets and redeemable non-controlling interests shows no measurable
impact. At the same time, the full impact of COVID-19 is still
unknown and there is limited visibility on the sustainability and
the further dynamic of the performance recovery across Yandex
businesses.
The extent to which the COVID-19 crisis impacts the Company’s
results will depend on future developments, which are still highly
uncertain and cannot be predicted, including new information which
may emerge concerning the severity of COVID-19 and the actions to
contain the virus or treat its impact, among others. The
development of the situation with respect to COVID-19 may also lead
to changes in estimates and assumptions that affect the reported
amounts of assets and liabilities. Actual results could differ from
those estimates.
Consolidated Results
The following table provides a summary of our key
consolidated financial results
for the three and nine months ended September 30, 2019 and 2020,
which consolidates Yandex.Market financial results from July 24,
2020:
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues |
45,014 |
58,335 |
30% |
123,695 |
146,745 |
19% |
Ex-TAC revenues4,5 |
39,292 |
53,819 |
37% |
107,074 |
132,715 |
24% |
Income from operations |
7,860 |
6,366 |
-19% |
19,809 |
11,869 |
-40% |
Adjusted EBITDA4 |
13,919 |
15,090 |
8% |
37,784 |
35,722 |
-5% |
Net income |
4,801 |
21,910 |
356% |
10,918 |
23,747 |
118% |
Adjusted net
income4 |
6,876 |
7,648 |
11% |
18,141 |
14,709 |
-19% |
The table below provides a summary of our key
financial results excluding
Yandex.Market for the three and nine months ended
September 30, 2019 and 2020:
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues |
45,014 |
53,704 |
19% |
123,695 |
142,114 |
15% |
Ex-TAC revenues4,5 |
39,292 |
49,296 |
25% |
107,074 |
128,193 |
20% |
Income from operations |
7,860 |
8,293 |
6% |
19,809 |
13,797 |
-30% |
Adjusted EBITDA4 |
13,919 |
16,174 |
16% |
37,784 |
36,806 |
-3% |
Net income |
5,830 |
4,663 |
-20% |
13,705 |
8,849 |
-35% |
Adjusted net
income4 |
7,905 |
9,354 |
18% |
20,928 |
18,764 |
-10% |
(4) The following measures presented in this release are
“non-GAAP financial measures”: ex-TAC revenues; adjusted EBITDA and
adjusted net income. Please see the section headed “Use of Non-GAAP
Financial Measures” below for a discussion of how we define these
measures, as well as reconciliations at the end of this release of
each of these measures to the most directly comparable U.S. GAAP
measures.
(5) Numbers for the previous periods were restated to reflect
minor adjustments of TAC revenue and expenses associated to the
presentation of certain content related streams.
Our segment disclosure is available in the Segment financial
results section below.
Consolidated revenues
breakdown
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Online advertising revenues: |
|
|
|
|
|
|
Yandex properties |
24,951 |
28,041 |
12% |
68,781 |
72,806 |
6% |
Advertising network |
6,281 |
5,138 |
-18% |
18,632 |
15,242 |
-18% |
Total online advertising revenues |
31,232 |
33,179 |
6% |
87,413 |
88,048 |
1% |
Revenues related to Taxi segment |
11,757 |
18,246 |
55% |
31,046 |
45,310 |
46% |
Other |
2,025 |
6,910 |
241% |
5,236 |
13,387 |
156% |
Total revenues |
45,014 |
58,335 |
30% |
123,695 |
146,745 |
19% |
Online advertising revenues
grew 6% in Q3 2020 compared with Q3 2019 and generated 57% of total
revenues. Excluding revenues of Yandex.Market from Q3 2020, online
advertising revenues increased 1% in Q3 2020 compared with Q3 2019.
Total online advertising revenue including Yandex.Market in full Q3
2020 and Q3 2019 grew 2% YoY.
Online advertising revenues from Yandex
properties increased 12% in Q3 2020 compared with
Q3 2019 and accounted for 48% of total revenues. Excluding revenues
of Yandex.Market from Q3 2020, online advertising revenues from
Yandex properties increased 6% in Q3 2020 compared with Q3 2019.
The increase was primarily driven by search revenues.
Online advertising revenues from our advertising
network decreased 18% in Q3 2020 compared with Q3
2019 and accounted for 9% of total revenues. The decrease was
primarily attributed to the adverse effect of COVID-19 on
advertisers’ activity in the partner network as well as due to
decrease of ad inventory from some of our partners.
Revenues related to the Taxi
segment grew 55% in Q3 2020 compared with Q3 2019
and accounted for 31% of total revenues, compared with 26% of total
revenues in Q3 2019. Revenues related to the Taxi segment include
revenues from Ride-hailing and FoodTech businesses as well as
Yandex.Drive, our car-sharing business (following the recent
restructuring of MLU B.V.). The increase of revenues related to the
Taxi segment was attributed to the growth of our FoodTech
businesses, driven by our hyperlocal grocery delivery service,
Yandex.Lavka, and the solid performance of Yandex.Eats business, as
well as to the growth of ride-hailing business, driven by an
increase in the number of rides and our corporate Taxi business,
the revenues of which we recognize on a gross basis.
Other revenues grew 241% in Q3
2020 compared with Q3 2019 and amounted to 12% of total revenues.
Excluding non-advertising revenues of Yandex.Market, other revenues
grew 98%. This growth was primarily driven by subscription revenues
of Media Services, our initiatives related to IoT (Internet of
Things) and expansion of our Geo and Cloud businesses.
Consolidated Operating Costs and
Expenses
Yandex’s operating costs and expenses consist of cost of
revenues, product development expenses, sales, general and
administrative expenses (SG&A) and depreciation and
amortization expenses (D&A). Apart from D&A, each of the
above expense categories include personnel-related costs and
expenses, relevant office space rental, and related share-based
compensation expense. Increases across all cost categories reflect
investments in overall growth. In Q3 2020 Yandex's headcount
increased by 1,239 full-time employees, compared to Q2 2020,
primarily as a result of consolidation of Yandex.Market. The total
number of full-time employees was 11,466 as of September 30, 2020,
up by 12% compared with June 30, 2020, and up 20% from September
30, 2019, of which 1,578 employees relate to Yandex.Market.
Cost of revenues, including traffic acquisition
costs (TAC)
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
TAC: |
|
|
|
|
|
|
Related to the Yandex advertising network |
3,813 |
2,866 |
-25% |
11,201 |
9,209 |
-18% |
Related to distribution partners |
1,909 |
1,650 |
-14% |
5,420 |
4,821 |
-11% |
Total TAC |
5,722 |
4,516 |
-21% |
16,621 |
14,030 |
-16% |
Total TAC as a % of total revenues |
12.7% |
7.7% |
|
13.4% |
9.6% |
|
Costs related to Taxi segment |
5,330 |
9,270 |
74% |
13,613 |
23,895 |
76% |
Costs related to Taxi segment as a % of revenues |
11.8% |
15.9% |
|
11.0% |
16.3% |
|
Other cost of revenues |
2,909 |
8,355 |
187% |
7,889 |
16,363 |
107% |
Other cost of revenues as a % of revenues |
6.5% |
14.3% |
|
6.4% |
11.2% |
|
Total cost of revenues |
13,961 |
22,141 |
59% |
38,123 |
54,288 |
42% |
Total cost of revenues as a % of revenues |
31.0% |
38.0% |
|
30.8% |
37.0% |
|
TAC decreased 21% in Q3 2020 compared with Q3 2019 and
represented 7.7% of total revenues, down 500 basis points compared
with Q3 2019 and 230 basis points down compared with Q2 2020. The
total TAC decrease was primarily driven by the decline of partner
TAC due to lower ad network revenues and partner TAC rates as well
as by optimization of distribution TAC rates.
Costs related to the Taxi
segment increased 74% compared with Q3 2019. The
growth was mainly a result of the increase of the costs of goods
sold (COGS) in our FoodTech services, mainly reflecting the growth
of Yandex.Lavka, our hyperlocal grocery delivery service, and the
increase of costs related to our corporate Taxi offering. We are
the principal in transactions with our Taxi corporate clients,
therefore, we recognize both revenues and cost of revenues on a
gross basis.
Other cost of revenues in Q3
2020 increased 187% compared with Q3 2019, primarily driven by
consolidation of Yandex.Market. Excluding cost of revenues related
to Yandex.Market, other costs of revenues were up 53% as a result
of our investments in content within Media Services and Search and
Portal, as well as our IoT initiatives.
Product development
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Product development |
7,118 |
9,414 |
32% |
21,108 |
26,312 |
25% |
|
As a % of revenues |
15.8% |
16.1% |
|
17.1% |
17.9% |
|
Product development expenses grew 32% in Q3 2020 compared to Q3
2019, primarily reflecting the increase of personnel expenses
mainly driven by consolidation of Yandex.Market, as well as growth
of share-based compensation.
Sales, general and administrative
(SG&A)
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Sales, general and administrative |
12,287 |
15,634 |
27% |
33,854 |
41,434 |
22% |
As a % of revenues |
27.3% |
26.8% |
|
27.4% |
28.2% |
|
SG&A expenses grew 27% in Q3 2020 compared to Q3 2019. The
growth was driven by the increase of advertising and marketing
expenses and personnel costs, primarily driven by consolidation of
Yandex.Market.
Share-based compensation (SBC)
expense
SBC expense is included in each of the cost of revenues, product
development, and SG&A categories discussed above.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
SBC expense included in cost of revenues |
72 |
111 |
54% |
204 |
325 |
59% |
SBC expense included in product development |
1,374 |
2,337 |
70% |
4,674 |
6,617 |
42% |
SBC expense included in SG&A |
801 |
1,505 |
88% |
2,258 |
3,971 |
76% |
Total SBC expense |
2,247 |
3,953 |
76% |
7,136 |
10,913 |
53% |
As a % of revenues |
5.0% |
6.8% |
|
5.8% |
7.4% |
|
Total SBC expense increased 76% in Q3 2020 compared with Q3
2019. The growth was primarily related to exchange of Yandex.Market
and MLU equity awards for new Yandex N.V. RSUs. The Company
accounted for the exchange as a modification resulting in
additional cost recognized immediately in Q3 2020. In addition, the
increase reflected new equity-based grants made in 2019-2020, as
well as material appreciation of the U.S. dollar against the
ruble.
Depreciation and amortization (D&A)
expense
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Depreciation and amortization |
3,788 |
4,780 |
26% |
10,801 |
12,842 |
19% |
|
As a % of revenues |
8.4% |
8.2% |
|
8.7% |
8.8% |
|
D&A expense increased 26% in Q3 2020 compared with Q3 2019.
The D&A expense increase was mainly driven by amortization of
intangible assets, servers and other equipment. Intangible assets
amortization increased primarily due to consolidation of
Yandex.Market in Q3 2020.
Income from operations
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Income from operations |
7,860 |
6,366 |
-19 |
% |
19,809 |
11,869 |
-40 |
% |
Income from operations decreased 19% in Q3 2020 compared with Q3
2019. Excluding Yandex.Market, income from operations was stable in
Q3 2020 compared with Q3 2019, primarily reflecting our prudent
approach to costs optimization in Q3 2020, offset by the changes in
segment mix amid the continuing investments in our rapidly growing
new businesses.
Segment financial results
Following the revision of our organizational structure and
financial disclosure, starting in Q3 2020 we introduced the
following changes to our segments under which we reported our
quarterly financial results previously, in order to better reflect
operational performance of our businesses:
- We transferred Drive
from Other Bets and Experiments category to Taxi segment, while
moving self-driving vehicles business, which we previously reported
in Taxi, into Other Bets and Experiments category;
- We transferred
Edadeal, a daily deal and coupon aggregator, from Search and Portal
segment to Other Bets and Experiments category;
- Other Bets and
Experiments category is expanded to include financial results of
Investments, our fintech service launched in July 2020, providing
access to various financial instruments to retail investors.
Prior periods were restated to conform to the current year
presentation. The historical data is available in the supplementary
slides accompanying our financial release.
Search & Portal
Our Search and Portal segment offers a broad range of services
in Russia, Belarus, Kazakhstan and Uzbekistan.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues: |
|
|
|
|
|
|
Search and Portal |
31,101 |
31,780 |
2% |
87,183 |
87,236 |
0% |
Search and Portal, excluding IoT* |
30,824 |
30,953 |
0% |
86,494 |
85,466 |
-1% |
Revenues Ex-TAC: |
|
|
|
|
|
|
Search and Portal |
24,648 |
26,666 |
8% |
68,511 |
71,475 |
4% |
Search and Portal, excluding IoT* |
24,371 |
25,839 |
6% |
67,822 |
69,705 |
3% |
Adjusted EBITDA: |
|
|
|
|
|
|
Search and Portal |
15,562 |
16,709 |
7% |
42,390 |
42,739 |
1% |
Search and Portal, excluding IoT* |
15,764 |
16,859 |
7% |
42,885 |
43,168 |
1% |
Adjusted EBITDA margin: |
|
|
|
|
|
|
Search and Portal |
50.0% |
52.6% |
2.6% |
48.6% |
49.0% |
0.4% |
Search and Portal, excluding IoT* |
51.1% |
54.5% |
3.4% |
49.6% |
50.5% |
0.9% |
*IoT stands for Internet of
Things
Revenues increased by 2% year-on-year in Q3 2020, reflecting the
sequential recovery of the advertising business in Q3 2020 after
the easing of the lockdown restrictions, primarily driven by
improvement of Search and Yandex Properties revenues, partially
offset by Yandex Ad Network revenues decline.
Ex-TAC revenues increased by 8% in Q3 2020 compared to Q3 2019,
reflecting the sequential recovery of the advertising business,
growing share of own properties in the total advertising revenues
and optimization of traffic acquisition costs.
Taxi
The Taxi segment includes our Ride-hailing business (including
Yandex.Go and Uber in Russia and 17 other countries across CIS and
EMEA), logistics B2B and B2B services, FoodTech business (including
Yandex.Eats, our ready-to-eat delivery service, and Yandex.Lavka,
our hyperlocal grocery delivery service) and our Yandex.Drive
car-sharing business.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues: |
|
|
|
|
|
|
Ride-hailing & FoodTech |
9,654 |
15,840 |
64% |
26,101 |
39,703 |
52% |
Drive |
2,123 |
2,712 |
28% |
4,992 |
6,001 |
20% |
Total revenues |
11,777 |
18,552 |
58% |
31,093 |
45,704 |
47% |
Adjusted EBITDA: |
|
|
|
|
|
|
Ride-hailing & FoodTech |
594 |
1,669 |
181% |
1,427 |
3,539 |
148% |
Drive |
(469) |
71 |
n/m |
(1,166) |
(1,869) |
60% |
Total Adjusted EBITDA |
125 |
1,740 |
n/m |
261 |
1,670 |
n/m |
Adjusted EBITDA margin: |
|
|
|
|
|
|
Ride-hailing & FoodTech |
6.2% |
10.5% |
4.3% |
5.5% |
8.9% |
3.4% |
Drive |
-22.1% |
2.6% |
24.7% |
-23.4% |
-31.1% |
-7.7% |
Total Adjusted EBITDA
margin |
1.1% |
9.4% |
8.3% |
0.8% |
3.7% |
2.9% |
Taxi segment revenues increased by 58%, primarily driven by the
solid performance of our food delivery business as well as the
growth of Yandex.Lavka and our corporate Taxi business, where we
recognize revenue on a gross basis.
Adjusted EBITDA of Taxi was RUB 1,740 million in Q3 2020, up
from RUB 125 million in Q3 2019. The increase of adjusted EBITDA
was primarily driven by the improving profitability of our
ride-hailing business, as well as by the significant improvement of
Yandex.Eats and Yandex.Drive adjusted EBITDA in Q3 2020, partially
offset by the losses of the rapidly growing Yandex.Lavka
business.
E-commerce
The E-commerce segment includes Yandex.Market, our e-commerce
platform combining the price comparison service, marketplace and
several small experiments.
In RUB
millions |
Three and nine months ended
September 30, |
|
2019 |
2020 |
Change |
Revenues |
- |
5,208 |
100% |
Adjusted EBITDA: |
- |
(1,077) |
100% |
Adjusted EBITDA margin: |
- |
-20.7% |
- |
The table below presents the standalone financial results of the
E-commerce segment on a comparable basis, which present the
standalone financial results of Yandex.Market for the full three
and nine months periods ended September 30, 2019 and 2020.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 * |
2020 |
Change |
2019 * |
2020 |
Change |
Revenues |
4,450 |
6,910 |
55% |
11,970 |
20,172 |
69% |
Adjusted EBITDA: |
(1,837) |
(1,221) |
-34% |
(5,411) |
(5,257) |
-3% |
Adjusted EBITDA margin: |
-41.3% |
-17.7% |
23.6% |
-45.2% |
-26.1% |
19.1% |
* Financial results of Yandex.Market for the full three and nine
months periods ended September 30, 2019 were not included in
Yandex’s consolidated financial results.
E-commerce revenues grew 55% in Q3 2020 compared with Q3 2019,
on the back of solid performance across both the price comparison
and the marketplace businesses. Price comparison revenues grew by
23% year-on-year, while GMV of the marketplace increased 134%
compared with Q3 2019.
Adjusted EBITDA loss of E-commerce was RUB 1,221 million in Q3
2020, compared to RUB 1,837 million in Q3 2019. The upturn in
profitability was driven by the improving efficiency of operations
(primarily delivery and fulfillment costs) on the back of the
development of our own courier platform, improving stock
replenishment and availability as well as growing number of orders
(economy of scale).
Classifieds
The Classifieds segment includes Auto.ru, Yandex.Realty and
Yandex.Jobs.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues |
1,371 |
1,586 |
16% |
3,779 |
3,960 |
5% |
Adjusted EBITDA: |
43 |
495 |
n/m |
(20) |
471 |
n/m |
Adjusted EBITDA margin: |
3.1% |
31.2% |
28.1% |
-0.5% |
11.9% |
12.4% |
Classifieds revenues increased 16% in Q3 2020 compared with Q3
2019, primarily as a result of recovery of activity at auto
dealerships following easing of lockdown regime, partially offset
by СOVID-related supply chain disruptions leading to stock
shortages at car dealerships.
Media Services
The Media Services segment includes KinoPoisk, Yandex.Music,
Yandex.Afisha, our production center Yandex.Studio and our
subscription service Yandex.Plus.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues |
924 |
1,773 |
92% |
2,534 |
4,906 |
94% |
Adjusted EBITDA: |
(636) |
(1,027) |
61% |
(1,514) |
(2,594) |
71% |
Adjusted EBITDA margin: |
-68.8% |
-57.9% |
10.9% |
-59.7% |
-52.9% |
6.8% |
Media Services revenues grew 92% in Q3 2020 compared with Q3
2019. The increase was primarily driven by the growth of
Yandex.Plus subscription revenues. Increasing Adjusted EBITDA
losses reflect our investments in content and marketing on the back
of increased demand for our services.
Other Bets and Experiments
The Other Bets and Experiments category includes our
self-driving vehicles business (“Yandex SDG”), Zen, Geolocation
Services (“Geo”), Edadeal, Investments, Yandex.Cloud and
Yandex.Education.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Revenues |
2,048 |
3,071 |
50% |
5,218 |
7,713 |
48% |
Adjusted EBITDA: |
(1,230) |
(1,851) |
50% |
(3,480) |
(5,784) |
66% |
Adjusted EBITDA margin: |
-60.1% |
-60.3% |
-0.2% |
-66.7% |
-75.0% |
-8.3% |
Other Bets and Experiments revenues increased 50% in Q3 2020
compared with Q3 2019. The increase was primarily driven by
recovery of revenue in Geo and Zen, as well as continuing growth of
our Cloud business. The Adjusted EBITDA loss amounted to RUB 1.9
billion, up from a loss of RUB 1.2 billion in Q3 2019, primarily
driven by costs associated with our self-driving vehicles business
and to a lesser degree our Education initiatives.
Eliminations
Eliminations related to our revenues represent the elimination
of transactions between the reportable segments, primarily related
to advertising. Eliminations related to our Adjusted EBITDA mainly
reflect reallocation of a portion of Search and Portal D&A
expenses related to leasehold improvements to office rent expenses
of our business units.
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 * |
Change |
2019 |
2020 * |
Change |
Revenues: |
|
|
|
|
|
|
Segment revenues |
47,221 |
61,970 |
31% |
129,807 |
154,727 |
19% |
Eliminations |
(2,207) |
(3,635) |
65% |
(6,112) |
(7,982) |
31% |
Total revenues |
45,014 |
58,335 |
30% |
123,695 |
146,745 |
19% |
Adjusted EBITDA: |
|
|
|
|
|
|
Segment Adjusted EBITDA |
13,864 |
14,989 |
8% |
37,637 |
35,425 |
-6% |
Eliminations |
55 |
101 |
84% |
147 |
297 |
102% |
Total adjusted
EBITDA |
13,919 |
15,090 |
8% |
37,784 |
35,722 |
-5% |
* Including RUB 5,208 million of revenues and RUB 1,077 million
of Adjusted EBITDA loss of Yandex.Market since July 24, 2020.
Eliminations related to our revenues increased 65% in Q3 2020
compared with Q3 2019. Excluding Yandex.Market, eliminations
related to our revenues increased 42% in Q3 2020. The increase was
mainly attributed to the revenue growth of Zen, which led to higher
eliminations of intercompany revenue and TAC in Search and Portal
and Other Bets and Experiments.
Adjusted EBITDA increased 8%
in Q3 2020 compared with Q3 2019. Excluding Yandex.Market, Adjusted
EBITDA increased 16%. The growth was mainly driven by the solid
performance of the Taxi and Search and Portal segments and
year-on-year improvement in the profitability of Classifieds
segment, which were slightly offset by our investments in Other
Bets and Experiments and Media Services.
Interest income in Q3 2020 was
RUB 1,009 million, compared with RUB 847 million in Q3 2019.
Interest expense in Q3 2020
was RUB 723 million, up from RUB 30 million in Q3 2019, reflecting
interest on the convertible bonds issued in February 2020.
Foreign exchange gain in Q3
2020 was RUB 509 million, compared with a foreign exchange gain of
RUB 254 million in Q3 2019. This gain reflects the depreciation of
the Russian ruble during Q3 2020 from RUB 69.9513 to $1.00 on June
30, 2020, to RUB 79.6845 to $1.00 on September 30, 2020. Yandex's
Russian operating subsidiaries' functional currency is the Russian
ruble, and therefore changes due to exchange rate fluctuations in
the ruble value of these subsidiaries' monetary assets and
liabilities that are denominated in other currencies are recognized
as foreign exchange gains or losses within the Other income/(loss),
net line in the condensed consolidated statements of income.
Although the U.S. dollar value of Yandex's U.S. dollar-denominated
assets and liabilities was not impacted by these currency
fluctuations, they resulted in an upward revaluation of the ruble
equivalent of these U.S. dollar-denominated monetary assets and
liabilities in Q3 2020.
Income tax expense for Q3 2020 was RUB 3,563
million, up from RUB 3,341 million in Q3 2019. Our effective tax
rate of 14.0% in Q3 2020 was lower than 41.0% in Q3 2019. Adjusted
for SBC expense, deferred tax asset valuation allowances, tax
provisions recognized and certain non-deductible and non-taxable
items (gain on Yandex.Market consolidation, loss on Yandex.Money
disposal and losses from the share of Yandex.Market’s financial
results), our effective tax rate for Q3 2020 was 24.0%, compared
with 24.4% for Q3 2019 as adjusted for similar effects in that
year.
Net income was RUB 21.9
billion ($275.0 million) in Q3 2020, up 356% compared with the net
income of RUB 4.8 billion in Q3 2019 primarily due to gain from
Yandex.Market consolidation and increase of foreign exchange
gains.
Adjusted net income in Q3 2020
was RUB 7.6 billion ($96.0 million), a 11% increase from Q3
2019.
Adjusted net income margin was
13.1% in Q3 2020, compared with 15.3% in Q3 2019.
As of September 30, 2020, Yandex had cash, cash
equivalents and term deposits of RUB 251.9
billion ($3,161.1 million), including cash, cash equivalents and
term deposits of Yandex.Taxi in total amount of RUB 30.5 billion
($382.7 million).
Net cash flow provided by operating
activities for Q3 2020 was RUB 18.9 billion
($237.2 million) and capital
expenditures were RUB 4.7 billion ($58.9
million).
Redeemable noncontrolling
interests presented in our condensed consolidated
balance sheets relate to the equity incentive arrangements we have
made available to the senior employees of the Taxi, Classifieds and
E-commerce segments, pursuant to which such persons are eligible to
acquire depositary receipts, or receive options to acquire
depositary receipts, which entitles them to economic interests in
the respective business unit subsidiaries.
The total number of shares issued and
outstanding as of September 30, 2020 was
352,269,451, including 316,560,776 Class A shares, 35,708,674 Class
B shares, and one Priority share and excluding 3,869,703 Class A
shares held in treasury and all Class C shares outstanding solely
as a result of the conversion of Class B shares into Class A
shares. Any such Class C shares will be cancelled.
There were also employee share options outstanding to purchase
up to an additional 3.1 million shares, at a weighted average
exercise price of $38.73 per share, 1.9 million of which were fully
vested; equity-settled share appreciation rights (SARs) for 0.1
million shares, at a weighted average measurement price of $32.72,
all of which were fully vested; and restricted share units (RSUs)
covering 14.4 million shares, of which RSUs to acquire 4.5 million
shares were fully vested. Equity awards in respect of business unit
subsidiaries are described under Redeemable noncontrolling
interests above.
Financial outlook
Given the persisting uncertainty around the full economic impact
of the coronavirus pandemic and potential further disruptions
caused by the emerging second wave of the health crisis and related
governmental and businesses responses, we are unable at this time
to reliably predict the pace and the shape of the further recovery
for our businesses. As such, we are not providing guidance until
there is greater clarity regarding the impact of the current
pandemic on the business environment generally and on Yandex in
particular.
Conference Call
Information
Yandex’s management will hold an earnings conference call on
October 28, 2020 at 8:00 AM U.S. Eastern Time (3:00 PM Moscow time;
12:00 PM London time).
We recommend using the dial-in option if you plan to ask
questions. In this case please dial-in at least 10 minutes prior to
the call start time (using dial-in number and confirmation code
stated below).
To access the conference call live, please dial:
US: +1 929 477 0324UK/International:
+44 (0) 330 336 9411Russia: 8 10 800 2867 5011Passcode: 5529696
A live and archived webcast of this conference call will be
available at
https://webcasts.eqs.com/yandex20201028
Following the call, a webcast replay will be available at the
Yandex Investor Relations website at
https://ir.yandex/events-and-presentations
ABOUT YANDEX
Yandex (NASDAQ and MOEX: YNDX) is a technology company that
builds intelligent products and services powered by machine
learning. Our goal is to help consumers and businesses better
navigate the online and offline world. Since 1997, we have
delivered world-class, locally relevant search and information
services. Additionally, we have developed market-leading on-demand
transportation services, navigation products and other mobile
applications for millions of consumers across the globe. Yandex,
which has 33 offices worldwide, has been listed on the NASDAQ since
2011.More information on Yandex can be found at
https://yandex.com/company.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that
involve risks and uncertainties. Actual results may differ
materially from the results predicted or implied by such
statements, and our reported results should not be considered as an
indication of future performance. The potential risks and
uncertainties that could cause actual results to differ from the
results predicted or implied by such statements include, among
others, the impact of the ongoing COVID-19 pandemic and regulatory
and business responses to that crisis, macroeconomic and
geopolitical developments affecting the Russian economy or our
business, changes in the political, legal and/or regulatory
environment, competitive pressures, changes in advertising
patterns, changes in user preferences, technological developments,
and our need to expend capital to accommodate the growth of the
business, as well as those risks and uncertainties included under
the captions “Risk Factors” and “Operating and Financial Review and
Prospects” in our Annual Report on Form 20-F for the year ended
December 31, 2019 and “Risk Factors” in the Shareholder Circular
filed as Exhibit 99.2 to our Current Report on Form 6-K, which were
filed with the U.S. Securities and Exchange Commission (SEC) on
April 2, 2020 and November 18, 2019, respectively, and are
available on our investor relations website at
http://ir.yandex.com/sec.cfm and on the SEC website at www.sec.gov.
All information in this release and in the attachments is as of
October 28, 2020, and Yandex undertakes no duty to update this
information unless required by law.
USE OF NON-GAAP FINANCIAL
MEASURES
To supplement our condensed consolidated financial statements,
which are prepared and presented in accordance with U.S. GAAP, we
present the following non-GAAP financial measures: ex-TAC revenues,
adjusted EBITDA, adjusted EBITDA margin, adjusted ex-TAC EBITDA
margin, adjusted net income, adjusted effective tax rate, adjusted
net income margin, adjusted ex-TAC net income margin and financial
results on a like-for-like basis excluding Yandex.Market. The
presentation of these financial measures is not intended to be
considered in isolation or as a substitute for, or superior to, the
financial information prepared and presented in accordance with
U.S. GAAP. For more information on these non-GAAP financial
measures, please see the tables captioned “Reconciliations of
non-GAAP financial measures to the nearest comparable U.S. GAAP
measures”, included following the accompanying financial tables. We
define the various non-GAAP financial measures we use as
follows:
- Ex-TAC revenues means U.S.
GAAP revenues less total traffic acquisition costs (TAC)
- Adjusted EBITDA means U.S.
GAAP net income plus (1) depreciation and amortization,
(2) SBC expense, (3) accrual of expense related to the
contingent compensation payable to employees in connection with
certain business combinations, (4) one-off restructuring expenses,
(5) interest expense, (6) loss from equity method investments
and (7) income tax expense, less (1) interest income, (2) other
income/(loss), net and (3) effect of Yandex.Market
consolidation
- Adjusted EBITDA margin means
adjusted EBITDA divided by U.S. GAAP revenues
- Adjusted ex-TAC EBITDA margin
means adjusted EBITDA divided by ex-TAC revenues
- Adjusted net income means
U.S. GAAP net income plus (1) SBC expense adjusted for the
income tax reduction attributable to SBC expense, (2) accrual
of expense related to the contingent compensation payable to
certain employees in connection with certain business combinations,
(3) one-off restructuring expenses, (4) loss from disposal of
investments and (5) amortization of debt discount related to our
convertible debt adjusted for the related reduction in income tax,
less (1) foreign exchange (gains)/losses adjusted for related
increase/(reduction) in income tax and (2) effect of Yandex.Market
consolidation
- Adjusted net income margin
means adjusted net income divided by U.S. GAAP revenues
- Adjusted ex-TAC net income
margin means adjusted net income divided by
ex-TAC revenues
- Financial results on a like-for-like basis
excluding Yandex.Market means revenues, ex-TAC
revenues, income from operations, adjusted EBITDA and net income
which completely exclude the results of Yandex.Market post the
consolidation, gain from consolidation of Yandex.Market and loss
from equity method investments associated with Yandex.Market for
the period prior to the consolidation.
These non-GAAP financial measures are used by management for
evaluating financial performance as well as decision-making.
Management believes that these metrics reflect the organic, core
operating performance of the company, and therefore are useful to
analysts and investors in providing supplemental information that
helps them understand, model and forecast the evolution of our
operating business.
Although our management uses these non-GAAP financial measures
for operational decision-making and considers these financial
measures to be useful for analysts and investors, we recognize that
there are a number of limitations related to such measures. In
particular, it should be noted that several of these measures
exclude some recurring costs, particularly share-based
compensation. In addition, the components of the costs that we
exclude in our calculation of the measures described above may
differ from the components that our peer companies exclude when
they report their results of operations.
Below we describe why we make particular adjustments to certain
U.S. GAAP financial measures:
TAC
We believe that it may be useful for investors and analysts to
review certain measures both in accordance with U.S. GAAP and net
of the effect of TAC, which we view as comparable to sales
commissions and bonuses but, unlike sales commissions and bonuses,
are not deducted from U.S. GAAP revenues. By presenting revenue,
adjusted EBITDA margin and adjusted net income margin net of TAC,
we believe that investors and analysts are able to obtain a clearer
picture of our business without the impact of the revenues we share
with our partners.
SBC
SBC is a significant expense item, and an important part of our
compensation and incentive programs. As it is a non-cash charge,
however, and highly dependent on our share price at the time of
equity award grants, we believe that it is useful for investors and
analysts to see certain financial measures excluding the impact of
these charges in order to obtain a clearer picture of our operating
performance.
Acquisition-related costs
We may incur expenses in connection with acquisitions that are
not indicative of our recurring core operating performance. In
particular, we are required under U.S. GAAP to accrue as expense
the contingent compensation that is payable to certain employees in
connection with certain business combinations. We eliminate these
acquisition-related expenses from adjusted EBITDA and adjusted net
income to provide management and investors a tool for comparing on
a period-to-period basis our operating performance in the ordinary
course of operations.
Foreign exchange gains and losses
Because we hold significant assets and liabilities in currencies
other than our Russian ruble operating currency, and because
foreign exchange fluctuations are outside of our operational
control, we believe that it is useful to present adjusted EBITDA,
adjusted net income and related margin measures excluding these
effects, in order to provide greater clarity regarding our
operating performance.
One-off restructuring expenses
Adjusted net income and adjusted EBITDA for 9M 2020 exclude
expenses related to restructuring targeted amendments to Corporate
Governance Structure approved by shareholders in December
2019. We believe that it is useful to present adjusted net
income, adjusted EBITDA and related margin measures excluding
impacts not related to our operating activities.
Effect of Yandex.Market consolidation
We adjust net income and EBITDA for gain on Yandex.Market
consolidation. We have eliminated this gain from adjusted net
income and adjusted EBITDA as we believe that it is useful to
present adjusted net income, adjusted EBITDA and related margins
measures excluding impacts not related to our operating
activities.
Loss from disposal of investment in Yandex.Money
We adjust net income for loss from disposal of investment in
Yandex.Money. We have added this loss to adjusted net income as we
believe that it is useful to present adjusted net income and
related margin measures excluding impacts not related to our
operating activities.
Amortization of debt discount
We also adjust net income for interest expense representing
amortization of the debt discount related to our convertible senior
notes due 2025 issued in Q1 2020. We have eliminated this expense
from adjusted net income as it is non-cash in nature and is not
indicative of our ongoing operating performance.
The tables at the end of this release provide detailed
reconciliations of each non-GAAP financial measure we use from the
most directly comparable U.S. GAAP financial measure.
YANDEX N.V.
Unaudited Condensed Consolidated
Balance Sheets
(in millions of Russian rubles
and U.S. dollars, except share and per share
data)
|
|
|
|
As of |
|
|
|
|
December 31, |
|
September 30, |
|
September 30, |
|
|
2019* |
|
2020 |
|
|
2020 |
|
|
|
RUB |
|
RUB |
|
$ |
ASSETS |
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
56,415 |
|
|
93,463 |
|
|
1,172.9 |
|
Term deposits |
|
31,891 |
|
|
158,432 |
|
|
1,988.2 |
|
Accounts receivable, net |
|
17,832 |
|
|
19,538 |
|
|
245.2 |
|
Prepaid expenses |
|
3,315 |
|
|
4,783 |
|
|
60.1 |
|
Funds receivable, net |
|
1,226 |
|
|
1,509 |
|
|
18.9 |
|
Other current assets |
|
9,605 |
|
|
14,736 |
|
|
184.9 |
|
Total current assets |
|
120,284 |
|
|
292,461 |
|
|
3,670.2 |
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
47,856 |
|
|
60,941 |
|
|
764.8 |
|
Operating lease right-of-use
assets |
|
21,218 |
|
|
18,992 |
|
|
238.3 |
|
Intangible assets, net |
|
10,365 |
|
|
22,604 |
|
|
283.7 |
|
Non-current content assets,
net |
|
3,295 |
|
|
5,602 |
|
|
70.3 |
|
Goodwill |
|
52,205 |
|
|
106,017 |
|
|
1,330.5 |
|
Long-term prepaid
expenses |
|
2,289 |
|
|
2,611 |
|
|
32.8 |
|
Investments in non-marketable
equity securities |
|
28,073 |
|
|
1,092 |
|
|
13.7 |
|
Deferred tax assets |
|
1,847 |
|
|
1,968 |
|
|
24.7 |
|
Other non-current assets |
|
3,694 |
|
|
4,744 |
|
|
59.5 |
|
TOTAL
ASSETS |
|
291,126 |
|
|
517,032 |
|
|
6,488.5 |
|
|
|
|
|
|
|
|
LIABILITIES
AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable and accrued
liabilities |
|
34,978 |
|
|
44,364 |
|
|
556.7 |
|
Income and non-income taxes
payable |
|
8,020 |
|
|
9,210 |
|
|
115.6 |
|
Deferred revenue |
|
3,542 |
|
|
4,770 |
|
|
59.9 |
|
Total current liabilities |
|
46,540 |
|
|
58,344 |
|
|
732.2 |
|
Convertible debt |
|
- |
|
|
89,275 |
|
|
1,120.4 |
|
Deferred tax liabilities |
|
1,951 |
|
|
5,852 |
|
|
73.4 |
|
Operating lease
liabilities |
|
10,841 |
|
|
10,615 |
|
|
133.2 |
|
Other accrued liabilities |
|
2,359 |
|
|
4,848 |
|
|
60.9 |
|
Total liabilities |
|
61,691 |
|
|
168,934 |
|
|
2,120.1 |
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
Redeemable noncontrolling
interests |
|
14,246 |
|
|
5,683 |
|
|
71.3 |
|
Shareholders’ equity: |
|
|
|
|
|
|
Priority share: €1.00 par value; shares authorized (1 and 1),
shares issued (1 and 1) and outstanding (nil and 1) |
|
— |
|
|
— |
|
|
— |
|
Ordinary shares: par value (Class A €0.01, Class B €0.10 and
Class C €0.09); shares authorized (Class A: 500,000,000, Class B:
37,138,658 and Class C: 37,748,658); shares issued (Class A:
293,527,655 and 320,430,479, Class B: 37,138,658 and 35,708,674,
and Class C: 610,000 and 1,429,984, respectively); shares
outstanding (Class A: 292,719,508 and 316,560,776, Class B:
37,138,658 and 35,708,674, and Class C: nil) |
|
261 |
|
|
278 |
|
|
3.5 |
|
Treasury shares at cost (Class A: 808,147 and 3,869,703,
Priority share: 1 and nil, respectively) |
|
(411 |
) |
|
(8 |
) |
|
(0.1 |
) |
Additional paid-in capital |
|
68,050 |
|
|
155,080 |
|
|
1,946.2 |
|
Accumulated other comprehensive income |
|
4,841 |
|
|
22,056 |
|
|
276.8 |
|
Retained earnings |
|
122,187 |
|
|
143,832 |
|
|
1,805.0 |
|
Total equity attributable to Yandex N.V. |
|
194,928 |
|
|
321,238 |
|
|
4,031.4 |
|
Noncontrolling interests |
|
20,261 |
|
|
21,177 |
|
|
265.7 |
|
Total shareholders’
equity |
|
215,189 |
|
|
342,415 |
|
|
4,297.1 |
|
TOTAL
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
291,126 |
|
|
517,032 |
|
|
6,488.5 |
|
* Derived from audited
consolidated financial statements
YANDEX N.V.
Unaudited
Condensed Consolidated Statements of
Income
(in millions of Russian rubles
and U.S. dollars, except share and per share
data)
|
|
Three months ended
September 30, |
|
|
2019 |
|
|
2020 |
|
|
2020 |
|
|
|
RUB |
|
RUB |
|
$ |
|
|
|
|
|
|
|
Revenues |
|
45,014 |
|
|
58,335 |
|
|
732.1 |
|
Operating costs and
expenses: |
|
|
|
|
|
|
Cost of revenues(1) |
|
13,961 |
|
|
22,141 |
|
|
277.9 |
|
Product development(1) |
|
7,118 |
|
|
9,414 |
|
|
118.1 |
|
Sales, general and
administrative(1) |
|
12,287 |
|
|
15,634 |
|
|
196.2 |
|
Depreciation and
amortization |
|
3,788 |
|
|
4,780 |
|
|
60.0 |
|
Total operating costs and
expenses |
|
37,154 |
|
|
51,969 |
|
|
652.2 |
|
Income from operations |
|
7,860 |
|
|
6,366 |
|
|
79.9 |
|
Interest income |
|
847 |
|
|
1,009 |
|
|
12.7 |
|
Interest expense |
|
(30 |
) |
|
(723 |
) |
|
(9.1 |
) |
Effect of Yandex.Market
consolidation |
|
- |
|
|
19,230 |
|
|
241.3 |
|
Loss from equity method
investments |
|
(899 |
) |
|
(94 |
) |
|
(1.2 |
) |
Other income/(loss), net |
|
364 |
|
|
(315 |
) |
|
(3.9 |
) |
Net income before income
taxes |
|
8,142 |
|
|
25,473 |
|
|
319.7 |
|
Income tax expense |
|
3,341 |
|
|
3,563 |
|
|
44.7 |
|
Net income |
|
4,801 |
|
|
21,910 |
|
|
275.0 |
|
Net loss attributable to
noncontrolling interests |
|
270 |
|
|
239 |
|
|
3.0 |
|
Net income attributable to
Yandex N.V. |
|
5,071 |
|
|
22,149 |
|
|
278.0 |
|
Net income per Class A
and Class B share: |
|
|
|
|
|
|
Basic |
|
15.46 |
|
|
63.04 |
|
|
0.79 |
|
Diluted |
|
15.11 |
|
|
61.13 |
|
|
0.77 |
|
Weighted average number of
Class A and Class B shares outstanding |
|
|
|
|
|
|
Basic |
|
327,950,520 |
|
|
351,372,700 |
|
|
351,372,700 |
|
Diluted |
|
335,432,722 |
|
|
361,941,154 |
|
|
361,941,154 |
|
|
|
|
|
|
|
|
(1) These
balances exclude depreciation and amortization expenses, which are
presented separately, and include share-based compensation expenses
of: |
|
|
|
|
|
|
|
Cost of revenues |
|
72 |
|
|
111 |
|
|
1.4 |
|
Product development |
|
1,374 |
|
|
2,337 |
|
|
29.3 |
|
Sales, general and
administrative |
|
801 |
|
|
1,505 |
|
|
18.9 |
|
YANDEX N.V.
Unaudited
Condensed Consolidated Statements of
Income
(in millions of Russian rubles
and U.S. dollars, except share and per share
data)
|
|
Nine months ended
September 30, |
|
|
|
2019 |
|
|
2020 |
|
|
2020 |
|
|
|
|
RUB |
|
RUB |
|
$ |
|
|
|
|
|
|
|
|
|
Revenues |
|
123,695 |
|
|
146,745 |
|
|
1,841.6 |
|
|
Operating costs and
expenses: |
|
|
|
|
|
|
|
Cost of revenues(1) |
|
38,123 |
|
|
54,288 |
|
|
681.3 |
|
|
Product development(1) |
|
21,108 |
|
|
26,312 |
|
|
330.2 |
|
|
Sales, general and
administrative(1) |
|
33,854 |
|
|
41,434 |
|
|
519.9 |
|
|
Depreciation and
amortization |
|
10,801 |
|
|
12,842 |
|
|
161.2 |
|
|
Total operating costs and
expenses |
|
103,886 |
|
|
134,876 |
|
|
1,692.6 |
|
|
Income from operations |
|
19,809 |
|
|
11,869 |
|
|
149.0 |
|
|
Interest income |
|
2,508 |
|
|
2,708 |
|
|
34.0 |
|
|
Interest expense |
|
(43 |
) |
|
(1,626 |
) |
|
(20.4 |
) |
|
Effect of Yandex.Market
consolidation |
|
- |
|
|
19,230 |
|
|
241.3 |
|
|
Loss from equity method
investments |
|
(2,483 |
) |
|
(2,177 |
) |
|
(27.3 |
) |
|
Other (loss)/income, net |
|
(285 |
) |
|
3,010 |
|
|
37.7 |
|
|
Net income before income
taxes |
|
19,506 |
|
|
33,014 |
|
|
414.3 |
|
|
Income tax expense |
|
8,588 |
|
|
9,267 |
|
|
116.3 |
|
|
Net income |
|
10,918 |
|
|
23,747 |
|
|
298.0 |
|
|
Net loss attributable to
noncontrolling interests |
|
957 |
|
|
952 |
|
|
12.0 |
|
|
Net income attributable to
Yandex N.V. |
|
11,875 |
|
|
24,699 |
|
|
310.0 |
|
|
Net income per Class A
and Class B share: |
|
|
|
|
|
|
|
Basic |
|
36.37 |
|
|
73.39 |
|
|
0.92 |
|
|
Diluted |
|
35.47 |
|
|
71.14 |
|
|
0.89 |
|
|
Weighted average number of
Class A and Class B shares outstanding |
|
|
|
|
|
|
|
Basic |
|
326,486,040 |
|
|
336,558,174 |
|
|
336,558,174 |
|
|
Diluted |
|
334,774,392 |
|
|
346,728,394 |
|
|
346,728,394 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) These
balances exclude depreciation and amortization expenses, which are
presented separately, and include share-based compensation expenses
of: |
|
|
|
|
|
|
|
|
|
Cost of revenues |
|
204 |
|
|
325 |
|
|
4.1 |
|
|
Product development |
|
4,674 |
|
|
6,617 |
|
|
83.0 |
|
|
Sales, general and
administrative |
|
2,258 |
|
|
3,971 |
|
|
49.9 |
|
|
YANDEX N.V.
Unaudited Condensed Consolidated
Statements of Cash Flows
(in millions of Russian rubles
and U.S. dollars)
|
|
Three months ended
September 30, |
|
|
2019 |
|
|
2020 |
|
|
2020 |
|
|
|
RUB |
|
RUB |
|
$ |
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES: |
|
|
|
|
|
|
Net income |
|
4,801 |
|
|
21,910 |
|
|
275.0 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation of property and
equipment |
|
3,110 |
|
|
3,549 |
|
|
44.6 |
|
Amortization of intangible
assets |
|
678 |
|
|
1,231 |
|
|
15.4 |
|
Amortization of content
assets |
|
346 |
|
|
728 |
|
|
9.1 |
|
Operating lease right-of-use
assets amortization |
|
2,358 |
|
|
2,890 |
|
|
36.3 |
|
Amortization of debt discount
and issuance costs |
|
- |
|
|
504 |
|
|
6.3 |
|
Share-based compensation
expense |
|
2,247 |
|
|
3,953 |
|
|
49.6 |
|
Deferred income tax
expense/(benefit) |
|
74 |
|
|
(717 |
) |
|
(9.0 |
) |
Foreign exchange gains |
|
(254 |
) |
|
(509 |
) |
|
(6.4 |
) |
Loss from equity method
investments |
|
899 |
|
|
94 |
|
|
1.2 |
|
Other |
|
135 |
|
|
980 |
|
|
12.3 |
|
Effect of Yandex.Market
consolidation |
|
- |
|
|
(19,230 |
) |
|
(241.3 |
) |
Changes in operating assets
and liabilities excluding the effect of acquisitions: |
|
|
|
|
|
|
Accounts receivable, net |
|
168 |
|
|
(1,331 |
) |
|
(16.7 |
) |
Prepaid expenses and other
assets |
|
24 |
|
|
1,105 |
|
|
13.9 |
|
Accounts payable and accrued
liabilities |
|
463 |
|
|
4,298 |
|
|
53.9 |
|
Deferred revenue |
|
1 |
|
|
490 |
|
|
6.1 |
|
Change in content assets |
|
(484 |
) |
|
(2,194 |
) |
|
(27.5 |
) |
Change in content
liabilities |
|
118 |
|
|
1,151 |
|
|
14.4 |
|
Net cash provided by operating
activities |
|
14,684 |
|
|
18,902 |
|
|
237.2 |
|
CASH FLOWS USED IN INVESTING
ACTIVITIES: |
|
|
|
|
|
|
Purchases of property and
equipment and intangible assets |
|
(5,305 |
) |
|
(4,694 |
) |
|
(58.9 |
) |
Proceeds from sale of property
and equipment |
|
7 |
|
|
36 |
|
|
0.5 |
|
Acquisitions of businesses,
net of cash acquired |
|
- |
|
|
(33,374 |
) |
|
(418.8 |
) |
Investments in term
deposits |
|
(28,507 |
) |
|
(145,965 |
) |
|
(1,831.8 |
) |
Maturities of term
deposits |
|
28,787 |
|
|
67,870 |
|
|
851.7 |
|
Loans granted, net of proceeds
from repayments |
|
- |
|
|
375 |
|
|
4.7 |
|
Net cash used in investing
activities |
|
(5,018 |
) |
|
(115,752 |
) |
|
(1,452.6 |
) |
CASH FLOWS USED IN FINANCING
ACTIVITIES: |
|
|
|
|
|
|
Proceeds from exercise of
share options |
|
89 |
|
|
40 |
|
|
0.5 |
|
Payment of debt issuance
costs |
|
- |
|
|
(11 |
) |
|
(0.1 |
) |
Ordinary shares issuance
costs |
|
- |
|
|
(87 |
) |
|
(1.1 |
) |
Payment for contingent
consideration |
|
(44 |
) |
|
(53 |
) |
|
(0.7 |
) |
Payment for finance
leases |
|
(87 |
) |
|
(171 |
) |
|
(2.1 |
) |
Other financing
activities |
|
29 |
|
|
(47 |
) |
|
(0.7 |
) |
Purchase of redeemable
noncontrolling interests |
|
(26 |
) |
|
(3,031 |
) |
|
(38.0 |
) |
Purchase of non-redeemable
noncontrolling interests |
|
- |
|
|
(1,709 |
) |
|
(21.4 |
) |
Net cash used in financing
activities |
|
(39 |
) |
|
(5,069 |
) |
|
(63.6 |
) |
Effect of exchange rate
changes on cash and cash balances |
|
92 |
|
|
11,097 |
|
|
139.2 |
|
Net change in cash and cash
equivalents |
|
9,719 |
|
|
(90,822 |
) |
|
(1,139.8 |
) |
Cash and cash equivalents at
beginning of period |
|
33,853 |
|
|
184,335 |
|
|
2,313.3 |
|
Cash and cash equivalents at
end of period |
|
43,572 |
|
|
93,513 |
|
|
1,173.5 |
|
|
|
|
|
|
|
|
Reconciliation
of cash and cash balances: |
|
|
|
|
|
|
Cash and cash equivalents,
beginning of period |
|
33,809 |
|
|
184,292 |
|
|
2,312.8 |
|
Restricted cash, beginning of
period |
|
44 |
|
|
43 |
|
|
0.5 |
|
Cash and cash balances,
beginning of period |
|
33,853 |
|
|
184,335 |
|
|
2,313.3 |
|
|
|
|
|
|
|
|
Cash and cash equivalents, end
of period |
|
43,528 |
|
|
93,463 |
|
|
1,172.9 |
|
Restricted cash, end of
period |
|
44 |
|
|
50 |
|
|
0.6 |
|
Cash and cash balances, end of
period |
|
43,572 |
|
|
93,513 |
|
|
1,173.5 |
|
YANDEX N.V.
Unaudited Condensed Consolidated
Statements of Cash Flows
(in millions of Russian rubles
and U.S. dollars)
|
|
Nine months ended
September 30, |
|
|
2019 |
|
|
2020 |
|
|
2020 |
|
|
|
RUB |
|
RUB |
|
$ |
CASH FLOWS PROVIDED BY
OPERATING ACTIVITIES: |
|
|
|
|
|
|
Net income |
|
10,918 |
|
|
23,747 |
|
|
298.0 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation of property and
equipment |
|
8,850 |
|
|
10,218 |
|
|
128.3 |
|
Amortization of intangible
assets |
|
1,951 |
|
|
2,624 |
|
|
32.9 |
|
Amortization of content
assets |
|
733 |
|
|
2,276 |
|
|
28.6 |
|
Operating lease right-of-use
assets amortization |
|
6,367 |
|
|
7,036 |
|
|
88.3 |
|
Amortization of debt discount
and issuance costs |
|
- |
|
|
1,141 |
|
|
14.3 |
|
Share-based compensation
expense |
|
7,136 |
|
|
10,913 |
|
|
137.0 |
|
Deferred income tax
expense |
|
1,834 |
|
|
23 |
|
|
0.3 |
|
Foreign exchange
losses/(gains) |
|
295 |
|
|
(3,666 |
) |
|
(46.0 |
) |
Loss from equity method
investments |
|
2,483 |
|
|
2,177 |
|
|
27.3 |
|
Other |
|
321 |
|
|
1,112 |
|
|
14.0 |
|
Effect of Yandex.Market
consolidation |
|
- |
|
|
(19,230 |
) |
|
(241.3 |
) |
Changes in operating assets
and liabilities excluding the effect of acquisitions: |
|
|
|
|
|
|
Accounts receivable, net |
|
(1,408 |
) |
|
222 |
|
|
2.7 |
|
Prepaid expenses and other
assets |
|
(3,296 |
) |
|
(3,099 |
) |
|
(38.9 |
) |
Accounts payable and accrued
liabilities |
|
653 |
|
|
(5,420 |
) |
|
(68.1 |
) |
Deferred revenue |
|
35 |
|
|
666 |
|
|
8.3 |
|
Change in content assets |
|
(2,193 |
) |
|
(4,797 |
) |
|
(60.2 |
) |
Change in content
liabilities |
|
1,075 |
|
|
523 |
|
|
6.6 |
|
Net cash provided by operating
activities |
|
35,754 |
|
|
26,466 |
|
|
332.1 |
|
CASH FLOWS USED IN INVESTING
ACTIVITIES: |
|
|
|
|
|
|
Purchases of property and
equipment and intangible assets |
|
(15,010 |
) |
|
(17,375 |
) |
|
(218.0 |
) |
Proceeds from sale of property
and equipment |
|
36 |
|
|
74 |
|
|
0.9 |
|
Acquisitions of businesses,
net of cash acquired |
|
(347 |
) |
|
(33,469 |
) |
|
(420.0 |
) |
Investments in non-marketable
equity securities |
|
(65 |
) |
|
(15 |
) |
|
(0.2 |
) |
Investments in term
deposits |
|
(76,262 |
) |
|
(267,957 |
) |
|
(3,362.7 |
) |
Maturities of term
deposits |
|
34,339 |
|
|
161,456 |
|
|
2,026.2 |
|
Loans granted, net of proceeds
from repayments |
|
84 |
|
|
391 |
|
|
4.8 |
|
Net cash used in investing
activities |
|
(57,225 |
) |
|
(156,895 |
) |
|
(1,969.0 |
) |
CASH FLOWS (USED IN)/PROVIDED
BY FINANCING ACTIVITIES: |
|
|
|
|
|
|
Proceeds from exercise of
share options |
|
140 |
|
|
88 |
|
|
1.1 |
|
Repurchases of share
options |
|
- |
|
|
(642 |
) |
|
(8.1 |
) |
Proceeds from issuance of
convertible debt |
|
- |
|
|
82,046 |
|
|
1,029.6 |
|
Payment of debt issuance
costs |
|
- |
|
|
(11 |
) |
|
(0.1 |
) |
Proceeds from issuance of
ordinary shares |
|
- |
|
|
72,650 |
|
|
911.7 |
|
Ordinary shares issuance
costs |
|
- |
|
|
(91 |
) |
|
(1.1 |
) |
Repurchases of ordinary
shares |
|
- |
|
|
(10,165 |
) |
|
(127.6 |
) |
Payment for contingent
consideration |
|
(91 |
) |
|
(63 |
) |
|
(0.8 |
) |
Proceeds from sale of
noncontrolling interests |
|
20 |
|
|
- |
|
|
- |
|
Payment for finance
leases |
|
(115 |
) |
|
(311 |
) |
|
(3.9 |
) |
Other financing
activities |
|
45 |
|
|
(113 |
) |
|
(1.4 |
) |
Purchase of redeemable
noncontrolling interests |
|
(238 |
) |
|
(3,078 |
) |
|
(38.6 |
) |
Purchase of non-redeemable
noncontrolling interests |
|
- |
|
|
(1,709 |
) |
|
(21.4 |
) |
Net cash (used in)/provided by
financing activities |
|
(239 |
) |
|
138,601 |
|
|
1,739.4 |
|
Effect of exchange rate
changes on cash and cash balances |
|
(3,604 |
) |
|
28,888 |
|
|
362.5 |
|
Net change in cash and cash
equivalents |
|
(25,314 |
) |
|
37,060 |
|
|
465.0 |
|
Cash and cash equivalents at
beginning of period |
|
68,886 |
|
|
56,453 |
|
|
708.5 |
|
Cash and cash equivalents at
end of period |
|
43,572 |
|
|
93,513 |
|
|
1,173.5 |
|
|
|
|
|
|
|
|
Reconciliation
of cash and cash balances: |
|
|
|
|
|
|
Cash and cash equivalents,
beginning of period |
|
68,798 |
|
|
56,415 |
|
|
708.0 |
|
Restricted cash, beginning of
period |
|
88 |
|
|
38 |
|
|
0.5 |
|
Cash and cash balances,
beginning of period |
|
68,886 |
|
|
56,453 |
|
|
708.5 |
|
|
|
|
|
|
|
|
Cash and cash equivalents, end
of period |
|
43,528 |
|
|
93,463 |
|
|
1,172.9 |
|
Restricted cash, end of
period |
|
44 |
|
|
50 |
|
|
0.6 |
|
Cash and cash balances, end of
period |
|
43,572 |
|
|
93,513 |
|
|
1,173.5 |
|
YANDEX N.V.
RECONCILIATIONS OF NON-GAAP
FINANCIAL MEASURESTO THE NEAREST
COMPARABLE U.S. GAAP MEASURES
Reconciliation of Ex-TAC Revenues
to U.S. GAAP Revenues
In RUB
millions |
Three months
endedSeptember 30, |
Nine months
endedSeptember 30, |
|
2019 |
2020 |
Change |
2019 |
2020 |
Change |
Total revenues |
45,014 |
58,335 |
30 |
% |
123,695 |
146,745 |
19% |
Less: traffic acquisition costs (TAC) |
5,722 |
4,516 |
-21 |
% |
16,621 |
14,030 |
-16% |
Ex-TAC revenues |
39,292 |
53,819 |
37 |
% |
107,074 |
132,715 |
24% |
Reconciliation of Adjusted EBITDA
to U.S. GAAP Net Income
In RUB
millions |
Three months
endedSeptember 30, |
Nine months
endedSeptember 30, |
|
2019 |
|
2020 |
|
Change |
2019 |
|
2020 |
|
Change |
Net income |
4,801 |
|
21,910 |
|
356 |
% |
10,918 |
|
23,747 |
|
118 |
% |
Add: depreciation and amortization |
3,788 |
|
4,780 |
|
26 |
% |
10,801 |
|
12,842 |
|
19 |
% |
Add: share-based compensation expense |
2,247 |
|
3,953 |
|
76 |
% |
7,136 |
|
10,913 |
|
53 |
% |
Add: compensation expense (reversal of expense) related to
contingent consideration |
24 |
|
(9 |
) |
n/m |
38 |
|
- |
|
n/m |
Add: one-off restructuring expenses |
- |
|
- |
|
n/m |
- |
|
98 |
|
n/m |
Less: interest income |
(847 |
) |
(1,009 |
) |
19 |
% |
(2,508 |
) |
(2,708 |
) |
8 |
% |
Add: interest expense |
30 |
|
723 |
|
n/m |
43 |
|
1,626 |
|
n/m |
Add: loss from equity method investments |
899 |
|
94 |
|
-90 |
% |
2,483 |
|
2,177 |
|
-12 |
% |
Less: other (income)/loss, net |
(364 |
) |
315 |
|
n/m |
285 |
|
(3,010 |
) |
n/m |
Less: effect of Yandex.Market consolidation |
- |
|
(19,230 |
) |
n/m |
- |
|
(19,230 |
) |
n/m |
Add: income tax expense |
3,341 |
|
3,563 |
|
7 |
% |
8,588 |
|
9,267 |
|
8 |
% |
Adjusted EBITDA |
13,919 |
|
15,090 |
|
8 |
% |
37,784 |
|
35,722 |
|
-5 |
% |
Reconciliation of Adjusted Net
Income to U.S. GAAP Net Income
|
|
|
|
|
|
|
In RUB
millions |
Three months
endedSeptember 30, |
Nine months ended
September 30, |
|
2019 |
|
2020 |
|
Change |
2019 |
|
2020 |
|
Change |
Net income |
4,801 |
|
21,910 |
|
356 |
% |
10,918 |
|
23,747 |
|
118 |
% |
Add: SBC expense |
2,247 |
|
3,953 |
|
76 |
% |
7,136 |
|
10,913 |
|
53 |
% |
Less: reduction in income tax attributable to SBC expense |
(20 |
) |
(41 |
) |
105 |
% |
(59 |
) |
(89 |
) |
51 |
% |
Add: compensation expense (reversal of expense) related to
contingent consideration |
24 |
|
(9 |
) |
n/m |
38 |
|
- |
|
n/m |
Less: foreign exchange (gains)/losses |
(254 |
) |
(509 |
) |
100 |
% |
295 |
|
(3,666 |
) |
n/m |
Add: increase/(reduction) in income tax attributable to foreign
exchange (gains)/losses |
78 |
|
296 |
|
279 |
% |
(66 |
) |
1,180 |
|
n/m |
Add: one-off restructuring expenses |
- |
|
- |
|
n/m |
- |
|
98 |
|
n/m |
Less: effect of deconsolidation of former subsidiaries |
- |
|
- |
|
n/m |
(121 |
) |
- |
|
n/m |
Add: loss from disposal of investment in Yandex.Money |
- |
|
900 |
|
n/m |
- |
|
900 |
|
n/m |
Less: effect of Yandex.Market consolidation |
- |
|
(19,230 |
) |
n/m |
- |
|
(19,230 |
) |
n/m |
Add: amortization of debt discount |
- |
|
504 |
|
n/m |
- |
|
1,141 |
|
n/m |
Less: reduction in income tax attributable to amortization of debt
discount |
- |
|
(126 |
) |
n/m |
- |
|
(285 |
) |
n/m |
Adjusted net
income |
6,876 |
|
7,648 |
|
11 |
% |
18,141 |
|
14,709 |
|
-19 |
% |
Reconciliation of Adjusted EBITDA
Margin and Adjusted Ex-TAC EBITDA Margin to U.S. GAAP Net Income
Margin
In RUB
millions |
|
|
|
|
|
|
|
|
U.S. GAAP Actual Net Income |
Net Income Margin (1) |
Adjustment (2) |
Adjusted EBITDA |
Adjusted EBITDA Margin (3) |
Adjusted Ex-TAC EBITDA Margin
(4) |
Three months ended September 30, 2020 |
21,910 |
37.6% |
(6,820 |
) |
15,090 |
25.9% |
28.0% |
|
|
|
|
|
|
|
|
Nine
months ended September 30, 2020 |
23,747 |
16.2% |
11,975 |
|
35,722 |
24.3% |
26.9% |
(1) Net income margin is defined as net
income divided by total revenues.(2) Adjusted to eliminate
depreciation and amortization expense, SBC expense, reversal of
expense related to contingent compensation, one-off restructuring
expenses, interest income, interest expense, loss from equity
method investments, other (income)/loss, net and income tax
expense. For a reconciliation of adjusted EBITDA to net income,
please see the table above.(3) Adjusted EBITDA margin is defined as
adjusted EBITDA divided by total revenues.(4) Adjusted ex-TAC
EBITDA margin is defined as adjusted EBITDA divided by ex-TAC
revenues. For a reconciliation of ex-TAC revenues to U.S. GAAP
revenues, please see the table above.
Reconciliation of Adjusted Net
Income Margin and Adjusted Ex-TAC Net Income Margin to U.S. GAAP
Net Income Margin
In RUB
millions |
|
|
|
|
|
|
|
|
U.S. GAAP Actual Net Income |
Net Income Margin (1) |
Adjustment (2) |
Adjusted Net Income |
Adjusted Net Income Margin
(3) |
Adjusted Ex-TAC NetIncome Margin
(4) |
Three months ended September 30, 2020 |
21,910 |
37.6 |
% |
(14,262 |
) |
7,648 |
13.1 |
% |
14.2 |
% |
Nine
months ended September 30, 2020 |
23,747 |
16.2 |
% |
(9,038 |
) |
14,709 |
10.0 |
% |
11.1 |
% |
(1) Net income margin is defined as net income divided by total
revenues.(2) Adjusted to eliminate SBC expense (as adjusted for the
income tax reduction attributable to SBC expense), reversal of
expense related to contingent compensation, foreign exchange gains
as adjusted for the increase in income tax attributable to the
gains, one-off restructuring expenses, loss from disposal of
investment in Yandex.Money, effect of Yandex.Market consolidation
and amortization of debt discount (as adjusted for the related
reduction in income tax). For a reconciliation of adjusted net
income to net income, please see the table above.(3) Adjusted net
income margin is defined as adjusted net income divided by total
revenues.(4) Adjusted ex-TAC net income margin is defined as
adjusted net income divided by ex-TAC revenues. For a
reconciliation of ex-TAC revenues to U.S. GAAP revenues, please see
the table above.
Reconciliation of financial
results on a like-for-like basis excluding Yandex.Market to U.S.
GAAP financial results
In RUB
millions |
Three months ended
September 30, |
Nine months ended
September 30, |
|
2019 |
2020 |
|
Change |
2019 |
2020 |
|
Change |
GAAP revenues |
45,014 |
58,335 |
|
30% |
|
123,695 |
146,745 |
|
19% |
|
Less: Revenues of Yandex.Market, net of intercompany
eliminations |
- |
(4,631 |
) |
100% |
|
- |
(4,631 |
) |
100% |
|
Non GAAP revenues |
45,014 |
53,704 |
|
19% |
|
123,695 |
142,114 |
|
15% |
|
GAAP income from operations |
7,860 |
6,366 |
|
-19% |
|
19,809 |
11,869 |
|
-40% |
|
Add: loss from operations of Yandex.Market, net of ICO |
- |
1,927 |
|
100% |
|
- |
1,927 |
|
100% |
|
Non GAAP income from operations |
7,860 |
8,293 |
|
6% |
|
19,809 |
13,797 |
|
-30% |
|
GAAP net income |
4,801 |
21,910 |
|
356% |
|
10,918 |
23,747 |
|
118% |
|
Add: loss from equity method investments |
1,029 |
121 |
|
100% |
|
2,787 |
2,470 |
|
100% |
|
Less: effect of Yandex.Market consolidation |
- |
(19,230 |
) |
100% |
|
- |
(19,230 |
) |
100% |
|
Add: loss of Yandex.Market |
- |
1,862 |
|
100% |
|
- |
1,862 |
|
100% |
|
Non GAAP net
income |
5,830 |
4,663 |
|
-20% |
|
13,705 |
8,849 |
|
-35% |
|
Contacts:
Investor RelationsYulia GerasimovaPhone: +7 495 974-35-38E-mail:
askIR@yandex-team.ru
Media RelationsIlya GrabovskiyPhone: +7 495 739-70-00E-mail:
pr@yandex-team.ru
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