Opera Limited (NASDAQ: OPRA), one of the world’s largest internet
consumer brands with over 380 million monthly active users, today
announced its unaudited consolidated financial results for the
quarter ended September 30, 2020.
Third quarter 2020 financial highlights
|
|
Three Months EndedSeptember 30, |
|
|
Year-over- |
|
|
Nine Months EndedSeptember 30, |
|
|
Year-over- |
|
[US$ thousands, except for margins and per ADS amounts] |
|
2019 |
|
|
2020 |
|
|
year % change |
|
|
2019 |
|
|
2020 |
|
|
year % change |
|
Revenue |
|
47,820 |
|
|
42,416 |
|
|
-11.3 |
% |
|
128,315 |
|
|
114,827 |
|
|
-10.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
28,120 |
|
|
154,367 |
|
|
449.0 |
% |
|
35,923 |
|
|
150,648 |
|
|
319.4 |
% |
Margin |
|
58.8 |
% |
|
363.9 |
% |
|
|
|
|
28.0 |
% |
|
131.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA (1) |
|
8,140 |
|
|
10,658 |
|
|
30.9 |
% |
|
17,484 |
|
|
10,917 |
|
|
-37.6 |
% |
Margin |
|
17.0 |
% |
|
25.1 |
% |
|
|
|
|
13.6 |
% |
|
9.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (1) |
|
26,977 |
|
|
9,553 |
|
|
-64.6 |
% |
|
37,791 |
|
|
16,680 |
|
|
-55.9 |
% |
Margin |
|
56.4 |
% |
|
22.5 |
% |
|
|
|
|
29.5 |
% |
|
14.5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per ADS,
US$ |
|
0.25 |
|
|
1.31 |
|
|
426.3 |
% |
|
0.32 |
|
|
1.26 |
|
|
294.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted adjusted net income
per ADS, US$ (1) |
|
0.24 |
|
|
0.08 |
|
|
-66.1 |
% |
|
0.34 |
|
|
0.15 |
|
|
-55.4 |
% |
_______________________________________
(1) Please see the separate section "About non-IFRS financial
measures" for the definitions of adjusted EBITDA and adjusted net
income.
Song Lin, Opera’s Co-CEO, said, “This quarter, we really showed
the strength of Opera’s core business with both our browsers and
Opera News having very nice growth in users and engagement. This in
turn led to combined search and advertising revenue returning to
year-over-year growth and recovering faster from COVID-19 than
initially expected. Specifically, search and advertising revenues
grew by 20% and 50%, respectively, versus the second quarter.
Finally, we were able to drive significant adjusted EBITDA margin
expansion, while investing in several initiatives we believe could
meaningfully accelerate growth rates beyond the solid growth from
our core business.”
Third quarter 2020 user base and product
highlights(All comparisons are relative to the third
quarter of 2019 unless otherwise stated)
- Opera News average Monthly Active Users (“MAUs”) grew 35% to
219 million
- Total smartphone average MAUs grew to 242 million, up 5%
- PC average MAUs were 75 million, up 10%
Mr. Song Lin commented, “I am very pleased with our execution.
We continued to grow users, invest in future products and make
strides in monetization despite a challenging environment from
COVID-19.
“Our user base in the third quarter exceeded 380 million monthly
active users, an increase of 18 million users compared to the
second quarter. This was driven by growth across our core regions
and platforms. Specifically, Opera News continued its strong
trajectory, growing approximately 30% year-over-year. Browsers grew
nicely as well and this was highlighted by PC users growing 10%
year-over-year, driven by Opera GX, and record smartphone
users.
“We continue to push forward aggressively on our new
initiatives. Highlighting one of our bigger initiatives, European
Fintech, we are making significant progress. We’ve been testing our
first product in Spain, a buy-now-pay-later offering, and the next
step will be to formally launch and introduce new branding. This is
planned to be followed by expansion into several other markets, and
efforts to broaden our offering next year. We believe European
fintech and several of our other new initiatives have the potential
to significantly benefit our growth rates.
“To sum it up, we are executing against our growth strategy,
recovering more quickly from COVID-19 than anticipated, and think
we’ve built a strong foundation to outperform next year and
beyond.”
Business outlook
Mr. Frode Jacobsen, Opera’s CFO, said, “Our growth trends
accelerated throughout the third quarter and this has continued so
far into the fourth quarter. Further, the strong recovery of search
and advertising revenue has led to significant margin expansion.
While some impacts from the pandemic remain, we are once again in a
position to provide forward looking guidance.”
For the fourth quarter, we expect revenues of $45 million to $47
million, excluding revenue from retail and microlending which are
both classified as discontinued operations. The expected results
will be driven by continued improvement in year-over-year growth
rates for search and advertising, resulting in an expected larger
increase from the third to fourth quarter compared to last year.
Tech revenue is expected to decline slightly compared to this past
quarter.
Adjusted EBITDA is expected to be between $10 million and $12
million, representing an adjusted EBITDA margin of 24% at the
midpoint. We anticipate search and advertising margin contribution
to increase relative to the third quarter, while we continue to
invest in new growth initiatives.
As we look to 2021, we expect to benefit from multiple factors
-- the strong user gains we made throughout 2020, the acceleration
from offline to online, and more normalized monetization. As such,
we indicate a baseline revenue expectation around $200 million for
2021, representing approximately 25% growth over 2020. This
indication is primarily driven by search and advertising growth and
only includes small revenue contributions from new initiatives. We
intend to provide a more detailed 2021 guidance with our fourth
quarter results.
Nanobank and other investments
On a pro forma basis in the third quarter, Nanobank posted
revenue of $34.9 million, up 87% compared to the second quarter,
and disbursed 2.5 million loans representing $155 million in total
value. Adjusted EBITDA was $8.8 million and post tax profits
were $6.0 million. Further, Nanobank continues to recover from
COVID-19 impacts with metrics improving in all geographies during
the third quarter. Indonesia is now close to pre-COVID levels, with
India and Kenya recovering more gradually, and Mexico, while still
early, is scaling.
Nanobank continues to prioritize profitable lending versus a
faster scaling with more credit risk. In the fourth quarter, we
expect Nanobank revenues to continue to scale rapidly with profit
margin expansion. We believe this puts Nanobank on a trajectory to
reach pre-COVID levels in 2021 for revenue as well as
profitability.
In terms of other investments, OPay continues to grow and scale
its payment offerings. In October, OPay processed a gross
transaction value of $1.4 billion on its platform, more than
three-times the level in January. Starmaker is also experiencing
strong growth. Daily active users are up approximately 80%
year-to-date and revenues have more than doubled year-to-date, to
an annual run rate of over $100 million.
Opera owns 42% of Nanobank, 13.1% of OPay and 19.35% of
Starmaker.
Third quarter 2020 consolidated financial
results
All comparisons in this section are relative to the third
quarter of 2019 unless otherwise stated. Fintech and retail revenue
are not included in comparisons as they are classified as
discontinued operations.
Revenue decreased 11% to $42.4 million
- Search revenue declined 1% to $21.2 million due to the impact
of COVID-19 on monetization, despite strong underlying user growth.
Search grew 20% compared to the second quarter
- Advertising revenue increased 4% to $19.0 million, subject to
the same effects as search revenue. Advertising revenue grew 50%
compared to the second quarter.
- Technology licensing and other revenue was $2.2 million. This
declined $5.8 million compared to the previous year as Opera has
been phasing out low-margin professional services for an
investee.
Operating expenses decreased 15% to $39.0
million.
- Cost of revenue was $2.9 million, a decrease of 47%
year-over-year. Within this total, $2.1 million related to the
browser and news business area and $0.7 million related to other
revenue.
- Personnel expenses, including share-based remuneration, were
$15.3 million, a 17% increase year-over-year. This expense consists
of cash-based compensation expense of $13.6 million, and
$1.7 million of share-based remuneration expense. The increase
was driven by increased resources relating to new growth
initiatives.
- Marketing and distribution expenses were $11.0 million, a
decrease of 34% year-over-year. The sequential decrease was
primarily related to lower marketing activity following strong
organic user growth, and reduced unit costs.
- Depreciation and amortization expenses were $4.9 million, a 10%
increase year-over-year primarily related to capitalized
development and other intangible assets.
- Other operating expenses were $4.3 million, a 35% decrease
year-over-year driven by general reductions across many areas.
Operating profit was $3.0 million, representing
an operating margin of 7%, compared to operating profit of
$2.2 million and a 5% margin during the third quarter of 2019.
The increase was primarily due to lower operating expenses,
particularly marketing and distribution expenses in response to
strong organic user growth in the quarter.
Other items include share of net profit of associates and joint
ventures of $0.2 million. This includes Nanobank, which had profits
of $3.3 million in the partial period after the transaction closed,
of which Opera recognized 42% less $0.9 million in PPA amortization
cost. Further, net finance gains were $4.4 million.
Income tax expense was $1.3 million in the
quarter.
Net income was $154.4 million, comprising $6.3
million in profits from continued operations and $148.1 million in
profits relating to discontinued operations, fueled by the gain
from the creation of Nanobank. This compared to a net income of
$28.1 million in the third quarter of 2019.
Net income per ADS was $1.33 in the
quarter. Each ADS represents two shares in Opera Limited. In the
quarter, the average number of shares outstanding was 235.6
million, corresponding to 117.8 million ADSs.
Adjusted EBITDA was $10.7 million, representing
a 25% adjusted EBITDA margin, compared to adjusted EBITDA of
$8.1 million in the third quarter 2019. Adjusted EBITDA
excludes share-based remuneration and non-recurring expenses, as
well as other income and discontinued operations.
Adjusted Net Income was $9.6 million in the
quarter, compared to adjusted net income of $27.0 million in
third quarter 2019. Adjusted net income excludes share-based
remuneration, non-recurring expenses, discontinued operations and
amortization of intangible assets related to acquisitions.
Adjusted net income per ADS was $0.08 in the
quarter.
Share repurchases were 2.5 million ADSs in the
quarter for a total spend of $22.4 million. Year-to-date, 5.0
million ADSs have been repurchased for a total spend of $40.9
million. $9.1 million remained available under the current
repurchase authorization as of September 30, 2020.
Discontinued operations include Opera’s retail
business, which was discontinued following a strategic assessment
as it had not been profit generating, and Opera’s fintech business,
which was contributed to Nanonbank on August 19, 2020. Opera owns
42% of Nanobank as of September 30, 2020. Retail would have added
$4.4 million to third quarter revenue had it not been
classified as discontinued operations.
We have posted unaudited supplemental information at
https://investor.opera.com, including: 1) Opera’s financial
historical results by quarter over 2019 and YTD 2020, reflecting
microlending and retail as discontinued operations; and 2) Nanobank
pro-forma financial results by quarter over 2019 and YTD 2020.
Conference call
Opera’s management will host a conference call to discuss the
third quarter 2020 financial results on Thursday, November 19th at
8:00 am Eastern Time (EST) (2:00 PM Central European Time, 9:00 PM
Beijing/Hong Kong time). Listeners may access the call by dialing
the following numbers:
United States: +1 833 570-1161China: +86 400 682 8609Hong Kong:
+852 5819 4851Norway: +47 2396 4173United Kingdom: +44 (0)203 107
0289International: +1 918 922-6511Confirmation Code: 3159725
A live webcast of the conference call will be posted at
https://investor.opera.com.
About non-IFRS financial measures
To supplement our consolidated financial statements, which are
prepared and presented based on IFRS, we use adjusted EBITDA and
adjusted net income, both non-IFRS financial measures, to
understand and evaluate our core operating performance. These
non-IFRS financial measures, which may differ from similarly titled
measures used by other companies, are presented to enhance
investors’ overall understanding of our financial performance and
should not be considered a substitute for, or superior to, the
financial information prepared and presented in accordance with
IFRS.
We define adjusted EBITDA as net income (loss) excluding income
tax expense (benefit), net finance expense (income), share of net
loss (income) of associates and joint ventures, restructuring
costs, depreciation and amortization, share-based remuneration,
other income, non-recurring expenses and discontinued
operations.
We define adjusted net income as net income excluding
share-based remuneration, amortization of acquired intangible
assets, non-recurring expenses and discontinued operations, net of
associated income tax adjustments.
We believe that adjusted EBITDA and adjusted net income provide
useful information to investors and others in understanding and
evaluating our operating results. These non-IFRS financial measures
adjust for the impact of items that we do not consider indicative
of the operational performance of our business. While we believe
that these non-IFRS financial measures are useful in evaluating our
business, this information should be considered as supplemental in
nature and is not meant as a substitute for the related financial
information prepared and presented in accordance with IFRS. Please
refer to our financial statements at the end of this announcement
for a table reconciling our non-IFRS financial measures to net
income (loss), the most directly comparable IFRS financial
measure.
Safe harbor statement
This press release contains statements of a forward-looking
nature. These statements, including statements relating to the
Company and its investees’ future financial and operating results,
are made under the “safe harbor” provisions of the U.S. Private
Securities Litigation Reform Act of 1995. You can identify these
forward-looking statements by terminology such as “will,”
“expects,” “believes,” “anticipates,” “intends,” “estimates” and
similar statements. Among other things, management’s quotations and
the Business outlook section contain forward-looking statements.
These forward-looking statements involve known and unknown risks
and uncertainties and are based on current expectations,
assumptions, estimates and projections about the Company, its
investees, the industry in which they operate, and the duration and
effects of the COVID-19 pandemic. Potential risks and uncertainties
include, but are not limited to, those relating to the development
of the COVID-19 situation, those relating to the Company and its
goals and strategies; expected development and launch, and market
acceptance, of products and services; Company and its investees’
expectations regarding demand for and market acceptance of their
brands, platforms and services; Company’s expectations regarding
growth in its user base and level of engagement; Company’s ability
to attract, retain and monetize users; Company’s ability to
continue to develop new technologies and/or upgrade its existing
technologies and quarterly variations in Company’s operating
results caused by factors beyond its control and global
macroeconomic conditions and their potential impact in the markets
in which Company or its investees have businesses. All information
provided in this press release is as of the date hereof, and the
Company undertakes no obligation to update any forward-looking
statements to reflect subsequent occurring events or circumstances,
or changes in its expectations, except as may be required by law.
Although the Company believes that the expectations expressed in
these forward-looking statements are reasonable, it cannot assure
you that its expectations will turn out to be correct, and
investors are cautioned that actual results may differ materially
from the anticipated results. Further information regarding risks
and uncertainties faced by Opera is included in the Company’s
filings with the U.S. Securities and Exchange Commission, including
its annual reports on Form 20-F.
About Opera
Opera is a global web innovator. Opera’s browsers, news products
and fintech solutions are the trusted choice of more than 380
million people worldwide. Opera is headquartered in Oslo, Norway
and listed on the NASDAQ stock exchange (OPRA).
Investor Relations Contact:
Derrick Nuemaninvestor-relations@opera.com or (408) 596-3055
For media enquiries, please contact: press-team@opera.com
|
UNAUDITED CONSOLIDATED STATEMENT OF
OPERATIONS |
|
|
|
Three Months EndedSeptember 30, |
|
|
Nine Months EndedSeptember 30, |
|
[US$ thousands, except per share and ADS amounts] |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
47,820 |
|
|
42,416 |
|
|
128,315 |
|
|
114,827 |
|
Other income |
|
- |
|
|
(426 |
) |
|
- |
|
|
5,568 |
|
Operating
expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
(5,372 |
) |
|
(2,856 |
) |
|
(9,855 |
) |
|
(9,401 |
) |
Personnel expenses including
share-based remuneration |
|
(12,670 |
) |
|
(15,260 |
) |
|
(34,285 |
) |
|
(44,330 |
) |
Marketing and distribution
expenses |
|
(16,831 |
) |
|
(11,038 |
) |
|
(51,735 |
) |
|
(35,542 |
) |
Credit loss expense |
|
345 |
|
|
34 |
|
|
(200 |
) |
|
(1,242 |
) |
Depreciation and
amortization |
|
(4,480 |
) |
|
(4,920 |
) |
|
(12,874 |
) |
|
(14,357 |
) |
Non-recurring expenses |
|
- |
|
|
(648 |
) |
|
- |
|
|
(3,222 |
) |
Other expenses |
|
(6,636 |
) |
|
(4,302 |
) |
|
(19,210 |
) |
|
(17,108 |
) |
Total operating
expenses |
|
(45,644 |
) |
|
(38,989 |
) |
|
(128,159 |
) |
|
(125,204 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
(loss) |
|
2,176 |
|
|
3,001 |
|
|
156 |
|
|
(4,808 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of net income (loss) of
associates and joint ventures |
|
23,295 |
|
|
155 |
|
|
26,252 |
|
|
(1,322 |
) |
Change in fair value of
preferred shares in associates |
|
- |
|
|
- |
|
|
- |
|
|
6,000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net finance income
(expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Finance income |
|
613 |
|
|
4,668 |
|
|
3,971 |
|
|
8,467 |
|
Finance expense |
|
(154 |
) |
|
(123 |
) |
|
(471 |
) |
|
(486 |
) |
Net foreign exchange gain
(loss) |
|
(516 |
) |
|
(158 |
) |
|
(492 |
) |
|
(588 |
) |
Net finance income
(expense) |
|
(58 |
) |
|
4,387 |
|
|
3,007 |
|
|
7,393 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit before income
taxes |
|
25,414 |
|
|
7,543 |
|
|
29,415 |
|
|
7,262 |
|
Income tax (expense)
benefit |
|
(895 |
) |
|
(1,290 |
) |
|
1,112 |
|
|
(632 |
) |
Profit from continuing
operations |
|
24,519 |
|
|
6,254 |
|
|
30,527 |
|
|
6,631 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit from discontinued
operations |
|
3,601 |
|
|
148,113 |
|
|
5,396 |
|
|
144,017 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
28,120 |
|
|
154,367 |
|
|
35,923 |
|
|
150,648 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
Equity holders of the
parent |
|
28,120 |
|
|
154,367 |
|
|
35,923 |
|
|
150,648 |
|
Non-controlling interests |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total net income
attributed |
|
28,120 |
|
|
154,367 |
|
|
35,923 |
|
|
150,648 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, millions(1) |
|
221.55 |
|
|
232.71 |
|
|
220.31 |
|
|
236.37 |
|
Diluted, millions(2) |
|
225.89 |
|
|
235.62 |
|
|
224.83 |
|
|
239.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per ordinary
share from continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.11 |
|
|
0.03 |
|
|
0.14 |
|
|
0.03 |
|
Diluted, US$ |
|
0.11 |
|
|
0.03 |
|
|
0.14 |
|
|
0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit per ADS from
continuing operations |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.22 |
|
|
0.05 |
|
|
0.28 |
|
|
0.06 |
|
Diluted, US$ |
|
0.22 |
|
|
0.05 |
|
|
0.27 |
|
|
0.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.13 |
|
|
0.66 |
|
|
0.16 |
|
|
0.64 |
|
Diluted, US$ |
|
0.12 |
|
|
0.66 |
|
|
0.16 |
|
|
0.63 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per
ADS |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.25 |
|
|
1.33 |
|
|
0.33 |
|
|
1.27 |
|
Diluted, US$ |
|
0.25 |
|
|
1.31 |
|
|
0.32 |
|
|
1.26 |
|
(1) As of September 30, 2020, the total number of shares
outstanding for Opera Limited was 230,136,862, equivalent to
115,068,431 ADSs. |
|
(2) Includes the net dilutive impact of employee equity awards,
all of which are dilutive. |
|
UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(LOSS) |
|
|
|
Three Months EndedSeptember 30, |
|
Nine Months EndedSeptember 30, |
|
[US$ thousands] |
|
2019 |
|
|
2020 |
|
2019 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
28,120 |
|
|
154,367 |
|
35,923 |
|
|
150,648 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss) that may be reclassified to the Statement of
Operations in subsequent periods (net of tax) |
|
|
|
|
|
|
|
|
|
|
|
Exchange differences on
translation of foreign operations |
|
(1,982 |
) |
|
451 |
|
(2,092 |
) |
|
(902 |
) |
Reclassification of exchange
differences on loss of control |
|
- |
|
|
3,098 |
|
7 |
|
|
3,087 |
|
Share of other comprehensive
income (loss) of associates and joint ventures |
|
- |
|
|
- |
|
(41 |
) |
|
- |
|
Net other
comprehensive income (loss) that may be reclassified to the
Statement of Operations in subsequent periods |
|
(1,982 |
) |
|
3,549 |
|
(2,126 |
) |
|
2,185 |
|
Total comprehensive
income |
|
26,139 |
|
|
157,917 |
|
33,797 |
|
|
152,834 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive
income attributable to: |
|
|
|
|
|
|
|
|
|
|
|
Equity holders of the
parent |
|
26,139 |
|
|
157,917 |
|
33,797 |
|
|
152,834 |
|
Non-controlling interests |
|
- |
|
|
- |
|
- |
|
|
- |
|
Total comprehensive
income attributed |
|
26,139 |
|
|
157,917 |
|
33,797 |
|
|
152,834 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION |
|
|
|
As of December 31, |
|
|
As of September 30, |
|
[US$
thousands] |
|
2019 |
|
|
2020 |
|
ASSETS |
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
Furniture, fixtures and
equipment |
|
26,053 |
|
|
19,556 |
|
Intangible assets |
|
110,807 |
|
|
113,960 |
|
Goodwill |
|
421,578 |
|
|
425,582 |
|
Investments in associates and
joint ventures |
|
76,300 |
|
|
346,848 |
|
Non-current financial
assets |
|
1,351 |
|
|
2,497 |
|
Deferred tax assets |
|
6,204 |
|
|
3,945 |
|
Total non-current
assets |
|
642,293 |
|
|
912,389 |
|
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
Trade receivables |
|
49,371 |
|
|
32,608 |
|
Loans to customers |
|
93,115 |
|
|
- |
|
Other receivables |
|
59,112 |
|
|
10,204 |
|
Prepayments |
|
25,809 |
|
|
13,705 |
|
Inventories |
|
7,752 |
|
|
178 |
|
Other current financial
assets |
|
1,535 |
|
|
- |
|
Marketable securities |
|
42,146 |
|
|
55,220 |
|
Cash and cash equivalents |
|
139,487 |
|
|
64,416 |
|
Total cash, cash equivalents,
and marketable securities |
|
181,633 |
|
|
119,636 |
|
Total current
assets |
|
418,327 |
|
|
176,332 |
|
TOTAL
ASSETS |
|
1,060,620 |
|
|
1,088,721 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND
LIABILITIES |
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Share capital |
|
24 |
|
|
24 |
|
Other paid in capital |
|
814,177 |
|
|
773,323 |
|
Retained earnings |
|
99,513 |
|
|
253,796 |
|
Foreign currency translation
reserve |
|
(1,508 |
) |
|
677 |
|
Equity attributed to
equity holders of the parent |
|
912,206 |
|
|
1,027,820 |
|
Non-controlling interests |
|
- |
|
|
- |
|
Total
equity |
|
912,206 |
|
|
1,027,820 |
|
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
Non-current lease liabilities
and other loans |
|
9,181 |
|
|
3,908 |
|
Deferred tax liabilities |
|
10,526 |
|
|
13,022 |
|
Other non-current
liabilities |
|
137 |
|
|
97 |
|
Total non-current
liabilities |
|
19,844 |
|
|
17,027 |
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Trade and other payables |
|
57,125 |
|
|
26,058 |
|
Current lease liabilities and
other loans |
|
47,793 |
|
|
5,185 |
|
Income tax payable |
|
7,803 |
|
|
908 |
|
Deferred revenue |
|
708 |
|
|
2,749 |
|
Other current liabilities |
|
15,142 |
|
|
8,974 |
|
Total current
liabilities |
|
128,570 |
|
|
43,875 |
|
|
|
|
|
|
|
|
Total
liabilities |
|
148,414 |
|
|
60,902 |
|
TOTAL EQUITY AND
LIABILITIES |
|
1,060,620 |
|
|
1,088,721 |
|
|
|
|
|
|
|
|
|
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY |
|
[US$ thousands] |
|
Sharecapital |
|
|
Other paidincapital |
|
|
Retainedearnings |
|
|
Foreigncurrencytranslationreserve |
|
|
Total equity |
|
As of December 31,
2018, as previously reported |
|
22 |
|
|
738,690 |
|
|
36,432 |
|
|
316 |
|
|
775,460 |
|
Impact of implementing IFRS 16
Leases |
|
- |
|
|
- |
|
|
64 |
|
|
- |
|
|
64 |
|
As of January 1, 2019,
restated |
|
22 |
|
|
738,690 |
|
|
36,496 |
|
|
316 |
|
|
775,524 |
|
Net income |
|
- |
|
|
- |
|
|
35,923 |
|
|
- |
|
|
35,923 |
|
Other comprehensive income
(loss) |
|
- |
|
|
- |
|
|
- |
|
|
(2,126 |
) |
|
(2,126 |
) |
Total comprehensive
income (loss) |
|
- |
|
|
- |
|
|
35,923 |
|
|
(2,126 |
) |
|
33,797 |
|
Contribution of equity, net of
transaction costs |
|
2 |
|
|
70,986 |
|
|
- |
|
|
- |
|
|
70,986 |
|
Acquisition of treasury
shares |
|
- |
|
|
(5,780 |
) |
|
- |
|
|
- |
|
|
(5,780 |
) |
Share-based remuneration
expense |
|
- |
|
|
- |
|
|
3,624 |
|
|
- |
|
|
3,624 |
|
As of September 30,
2019 |
|
24 |
|
|
803,896 |
|
|
76,044 |
|
|
(1,810 |
) |
|
878,154 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[US$ thousands] |
|
Sharecapital |
|
|
Other paidincapital |
|
|
Retainedearnings |
|
|
Foreign
currencytranslationreserve |
|
|
Total equity |
|
As of December 31,
2019 |
|
24 |
|
|
814,177 |
|
|
99,513 |
|
|
(1,508 |
) |
|
912,206 |
|
Net income |
|
- |
|
|
- |
|
|
150,648 |
|
|
- |
|
|
150,648 |
|
Other comprehensive
income |
|
- |
|
|
- |
|
|
- |
|
|
2,185 |
|
|
2,185 |
|
Total comprehensive
income |
|
- |
|
|
- |
|
|
150,648 |
|
|
2,185 |
|
|
152,833 |
|
Acquisition of treasury
shares |
|
- |
|
|
(40,854 |
) |
|
- |
|
|
- |
|
|
(40,854 |
) |
Share-based remuneration
expense |
|
- |
|
|
- |
|
|
3,635 |
|
|
- |
|
|
3,635 |
|
As of September 30,
2020 |
|
24 |
|
|
773,323 |
|
|
253,796 |
|
|
677 |
|
|
1,027,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UNAUDITED CONSOLIDATED STATEMENT OF CASH
FLOWS |
|
|
|
Three Months EndedSeptember 30, |
|
|
Nine Months EndedSeptember 30, |
|
[US$ thousands] |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
Cash flow from
operating activities |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) before
income taxes from continuing operations |
|
25,414 |
|
|
7,546 |
|
|
29,415 |
|
|
8,511 |
|
Net income (loss) before
income taxes from discontinued operations |
|
4,383 |
|
|
147,943 |
|
|
7,482 |
|
|
139,277 |
|
Income taxes paid |
|
(173 |
) |
|
(899 |
) |
|
2,966 |
|
|
(8,001 |
) |
Depreciation and
amortization |
|
4,511 |
|
|
4,955 |
|
|
12,934 |
|
|
14,511 |
|
Share of net loss (income) of
associates and joint ventures |
|
(23,295 |
) |
|
(155 |
) |
|
(26,252 |
) |
|
1,322 |
|
Change in fair value of
preferred shares in associates and joint ventures |
|
- |
|
|
- |
|
|
- |
|
|
(6,000 |
) |
Equity component of
share-based payment expense |
|
1,377 |
|
|
1,401 |
|
|
3,640 |
|
|
3,635 |
|
Gain on disposal of fintech
segment |
|
- |
|
|
(152,048 |
) |
|
- |
|
|
(152,048 |
) |
Net finance expense
(income) |
|
151 |
|
|
(4,387 |
) |
|
(2,728 |
) |
|
(7,393 |
) |
Change in inventories |
|
(1,933 |
) |
|
6 |
|
|
(1,932 |
) |
|
7,573 |
|
Change in trade and other
receivables |
|
(7,107 |
) |
|
14,555 |
|
|
(10,515 |
) |
|
20,116 |
|
Change in loans to
customers |
|
(33,253 |
) |
|
(5,689 |
) |
|
(52,416 |
) |
|
73,433 |
|
Change in trade and other
payables |
|
9,325 |
|
|
3,779 |
|
|
23,585 |
|
|
(24,530 |
) |
Change in deferred
revenue |
|
(59 |
) |
|
(1,279 |
) |
|
(773 |
) |
|
2,058 |
|
Change in prepayments |
|
(2,823 |
) |
|
9,739 |
|
|
(12,485 |
) |
|
7,387 |
|
Change in other
liabilities |
|
7,468 |
|
|
(4,901 |
) |
|
5,333 |
|
|
(5,519 |
) |
Other |
|
(1,525 |
) |
|
(3,199 |
) |
|
(2,715 |
) |
|
1,505 |
|
Net cash flow from
(used in) operating activities |
|
(17,539 |
) |
|
17,370 |
|
|
(24,460 |
) |
|
75,838 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from
investment activities |
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of intangibles
assets |
|
- |
|
|
(789 |
) |
|
- |
|
|
(2,278 |
) |
Purchase of equipment |
|
(2,588 |
) |
|
(86 |
) |
|
(7,154 |
) |
|
(2,319 |
) |
Investment in, and loans to
associates and joint ventures |
|
- |
|
|
- |
|
|
(6,758 |
) |
|
- |
|
Acquisition of subsidiary, net
of cash acquired |
|
- |
|
|
- |
|
|
- |
|
|
(4,882 |
) |
Disbursement of short-term
loans |
|
- |
|
|
- |
|
|
- |
|
|
(4,497 |
) |
Cash transferred with Okash
Group |
|
- |
|
|
(39,260 |
) |
|
- |
|
|
(39,260 |
) |
Release of escrow account |
|
- |
|
|
- |
|
|
- |
|
|
1,000 |
|
Repayment of short-term
loans |
|
- |
|
|
- |
|
|
- |
|
|
4,497 |
|
Deposit of collateral for loan
facility |
|
- |
|
|
- |
|
|
- |
|
|
(1,000 |
) |
Net sale (purchase) of listed
equity instruments |
|
(31,625 |
) |
|
6,313 |
|
|
(45,673 |
) |
|
(3,089 |
) |
Development expenditure |
|
(1,098 |
) |
|
(2,132 |
) |
|
(3,209 |
) |
|
(5,938 |
) |
Interest income received |
|
- |
|
|
105 |
|
|
- |
|
|
531 |
|
Net cash flow from
(used in) investing activities |
|
(35,311 |
) |
|
(35,849 |
) |
|
(62,794 |
) |
|
(57,235 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from
financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of treasury
shares |
|
- |
|
|
(22,384 |
) |
|
(4,983 |
) |
|
(40,854 |
) |
Proceeds from loans and
borrowings |
|
20,335 |
|
|
- |
|
|
19,515 |
|
|
6,905 |
|
Interests on loans and
borrowings |
|
(106 |
) |
|
29 |
|
|
(387 |
) |
|
(1,676 |
) |
Proceeds from issues of equity
instruments |
|
71,852 |
|
|
- |
|
|
71,852 |
|
|
- |
|
Repayment of loans and
borrowings |
|
(437 |
) |
|
- |
|
|
(1,337 |
) |
|
(53,180 |
) |
Transaction costs on issue of
equity instruments |
|
(864 |
) |
|
- |
|
|
(864 |
) |
|
- |
|
Payment of lease
liabilities |
|
(574 |
) |
|
(1,525 |
) |
|
(2,755 |
) |
|
(3,777 |
) |
Net cash flow from
(used in) financing activities |
|
90,206 |
|
|
(23,880 |
) |
|
81,041 |
|
|
(92,582 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net change in cash and
cash equivalents |
|
37,356 |
|
|
(42,359 |
) |
|
(6,213 |
) |
|
(73,979 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at
beginning of period |
|
134,155 |
|
|
105,453 |
|
|
177,873 |
|
|
139,487 |
|
Net foreign exchange
difference |
|
(813 |
) |
|
1,322 |
|
|
(962 |
) |
|
(1,092 |
) |
Cash and cash
equivalents at end of period |
|
170,697 |
|
|
64,416 |
|
|
170,697 |
|
|
64,416 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial
details by business area |
|
The tables below
specify the contribution by each business area: |
|
[US$ thousands] |
|
Three Months Ended September 30, 2019 |
|
Business area |
|
Browser andNews |
|
|
Other |
|
|
Total |
|
Revenue
categories |
|
|
|
|
|
|
|
|
|
Search |
|
21,527 |
|
|
- |
|
|
21,527 |
|
Advertising |
|
18,349 |
|
|
- |
|
|
18,349 |
|
Technology licensing and other
revenue |
|
- |
|
|
7,944 |
|
|
7,944 |
|
Total
revenue |
|
39,876 |
|
|
7,944 |
|
|
47,820 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
(207 |
) |
|
(5,165 |
) |
|
(5,372 |
) |
Marketing and distribution
expenses |
|
(16,831 |
) |
|
- |
|
|
(16,831 |
) |
Credit loss expense |
|
345 |
|
|
- |
|
|
345 |
|
Direct
expenses |
|
(16,693 |
) |
|
(5,165 |
) |
|
(21,858 |
) |
|
|
|
|
|
|
|
|
|
|
Contribution by
business area |
|
23,183 |
|
|
2,779 |
|
|
25,963 |
|
|
|
|
|
|
|
|
|
|
|
[US$ thousands] |
|
Three Months Ended September 30, 2020 |
|
Business area |
|
Browser andNews |
|
|
Other |
|
|
Total |
|
Revenue
categories |
|
|
|
|
|
|
|
|
|
Search |
|
21,237 |
|
|
- |
|
|
21,237 |
|
Advertising |
|
18,968 |
|
|
36 |
|
|
19,004 |
|
Technology licensing and other
revenue |
|
- |
|
|
2,175 |
|
|
2,175 |
|
Total
revenue |
|
40,205 |
|
|
2,211 |
|
|
42,416 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
(2,131 |
) |
|
(725 |
) |
|
(2,856 |
) |
Marketing and distribution
expenses |
|
(10,879 |
) |
|
(159 |
) |
|
(11,038 |
) |
Credit loss expense |
|
34 |
|
|
- |
|
|
34 |
|
Direct
expenses |
|
(12,976 |
) |
|
(884 |
) |
|
(13,860 |
) |
|
|
|
|
|
|
|
|
|
|
Contribution by
business area |
|
27,229 |
|
|
1,327 |
|
|
28,556 |
|
|
|
|
|
|
|
|
|
|
|
[US$ thousands] |
|
Nine Months Ended September 30, 2019 |
|
Business area |
|
Browser andNews |
|
|
Other |
|
|
Total |
|
Revenue
categories |
|
|
|
|
|
|
|
|
|
Search |
|
63,514 |
|
|
- |
|
|
63,514 |
|
Advertising |
|
48,649 |
|
|
- |
|
|
48,649 |
|
Technology licensing and other
revenue |
|
- |
|
|
16,152 |
|
|
16,152 |
|
Total
revenue |
|
112,163 |
|
|
16,152 |
|
|
128,315 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
(1,420 |
) |
|
(8,435 |
) |
|
(9,855 |
) |
Marketing and distribution
expenses |
|
(51,730 |
) |
|
(5 |
) |
|
(51,735 |
) |
Credit loss expense |
|
(200 |
) |
|
- |
|
|
(200 |
) |
Direct
expenses |
|
(53,350 |
) |
|
(8,440 |
) |
|
(61,790 |
) |
|
|
|
|
|
|
|
|
|
|
Contribution by
business area |
|
58,813 |
|
|
7,712 |
|
|
66,525 |
|
|
|
|
|
|
|
|
|
|
|
[US$ thousands] |
|
Nine Months Ended September 30, 2020 |
|
Business area |
|
Browser andNews |
|
|
Other |
|
|
Total |
|
Revenue
categories |
|
|
|
|
|
|
|
|
|
Search |
|
58,527 |
|
|
- |
|
|
58,527 |
|
Advertising |
|
48,389 |
|
|
36 |
|
|
48,425 |
|
Technology licensing and other
revenue |
|
- |
|
|
7,875 |
|
|
7,875 |
|
Total
revenue |
|
106,916 |
|
|
7,911 |
|
|
114,827 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
(5,614 |
) |
|
(3,787 |
) |
|
(9,401 |
) |
Marketing and distribution
expenses |
|
(34,974 |
) |
|
(568 |
) |
|
(35,542 |
) |
Credit loss expense |
|
(534 |
) |
|
(708 |
) |
|
(1,242 |
) |
Direct
expenses |
|
(41,122 |
) |
|
(5,063 |
) |
|
(46,185 |
) |
|
|
|
|
|
|
|
|
|
|
Contribution by
business area |
|
65,794 |
|
|
2,848 |
|
|
68,642 |
|
|
|
|
|
|
|
|
|
|
|
Personnel
expenses including share-based remuneration |
|
The table below
specifies the amounts of personnel expenses including share-based
remuneration: |
|
[US$ thousands] |
|
Three Months EndedSeptember 30, |
|
|
Nine Months EndedSeptember 30, |
|
Personnel expenses including share-based
remuneration |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
Personnel expenses excluding
share-based remuneration |
|
11,187 |
|
|
13,596 |
|
|
29,831 |
|
|
40,616 |
|
Share-based remuneration,
including related social security costs |
|
1,483 |
|
|
1,663 |
|
|
4,454 |
|
|
3,714 |
|
Total |
|
12,670 |
|
|
15,260 |
|
|
34,285 |
|
|
44,330 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
expenses |
|
The table below
specifies the nature of other expenses: |
|
[US$ thousands] |
|
Three Months EndedSeptember 30, |
|
|
Nine Months EndedSeptember 30, |
|
Other expenses |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
Hosting |
|
1,879 |
|
|
1,790 |
|
|
5,277 |
|
|
5,942 |
|
Audit, legal and other
advisory services |
|
1,473 |
|
|
1,119 |
|
|
5,145 |
|
|
4,308 |
|
Software license fees |
|
745 |
|
|
467 |
|
|
1,784 |
|
|
1,450 |
|
Rent and other office
expense |
|
1,074 |
|
|
793 |
|
|
3,227 |
|
|
2,302 |
|
Travel |
|
1,007 |
|
|
114 |
|
|
2,353 |
|
|
1,094 |
|
Other |
|
459 |
|
|
19 |
|
|
1,423 |
|
|
2,013 |
|
Total |
|
6,636 |
|
|
4,302 |
|
|
19,210 |
|
|
17,108 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-IFRS
financial measures |
|
|
|
Three Months EndedSeptember 30, |
|
|
Nine Months EndedSeptember 30, |
|
[US$ thousands, except per share and ADS amounts] |
|
2019 |
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
Reconciliation of net income
(loss) to adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
28,120 |
|
|
154,367 |
|
|
35,923 |
|
|
150,648 |
|
Add: Income tax expense
(benefit) |
|
895 |
|
|
1,290 |
|
|
(1,112 |
) |
|
632 |
|
Add: Net finance expense
(income) |
|
58 |
|
|
(4,387 |
) |
|
(3,007 |
) |
|
(7,393 |
) |
Add: Share of net loss
(income) of associates and joint ventures |
|
(23,295 |
) |
|
(155 |
) |
|
(26,252 |
) |
|
1,322 |
|
Add: Change in fair value of
preferred shares in associates |
|
- |
|
|
- |
|
|
- |
|
|
(6,000 |
) |
Add: Depreciation and
amortization |
|
4,480 |
|
|
4,920 |
|
|
12,874 |
|
|
14,357 |
|
Add: Share-based
remuneration |
|
1,483 |
|
|
1,663 |
|
|
4,454 |
|
|
3,714 |
|
Add: Non-recurring
expenses |
|
- |
|
|
648 |
|
|
- |
|
|
3,222 |
|
Less: Other income |
|
- |
|
|
426 |
|
|
- |
|
|
(5,568 |
) |
Less: Profit from discontinued
operations |
|
(3,601 |
) |
|
(148,113 |
) |
|
(5,396 |
) |
|
(144,017 |
) |
Adjusted
EBITDA |
|
8,140 |
|
|
10,658 |
|
|
17,484 |
|
|
10,917 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of net income
(loss) to adjusted net income |
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income |
|
28,120 |
|
|
154,367 |
|
|
35,923 |
|
|
150,648 |
|
Add: Share-based
remuneration |
|
1,483 |
|
|
1,663 |
|
|
4,454 |
|
|
3,714 |
|
Add: Amortization of acquired
intangible assets |
|
1,280 |
|
|
1,340 |
|
|
3,840 |
|
|
4,013 |
|
Add: Non-recurring
expenses |
|
- |
|
|
648 |
|
|
- |
|
|
3,222 |
|
Income tax adjustment (1) |
|
(305 |
) |
|
(352 |
) |
|
(1,030 |
) |
|
(900 |
) |
Less: Profit from discontinued
operations |
|
(3,601 |
) |
|
(148,113 |
) |
|
(5,396 |
) |
|
(144,017 |
) |
Adjusted net
income |
|
26,977 |
|
|
9,553 |
|
|
37,791 |
|
|
16,680 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of ordinary shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, millions |
|
221.55 |
|
|
232.71 |
|
|
220.31 |
|
|
236.37 |
|
Diluted, millions |
|
225.89 |
|
|
235.62 |
|
|
224.83 |
|
|
239.06 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss) per ordinary share |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.12 |
|
|
0.04 |
|
|
0.17 |
|
|
0.08 |
|
Diluted, US$ |
|
0.12 |
|
|
0.04 |
|
|
0.17 |
|
|
0.07 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income
(loss) per ADS |
|
|
|
|
|
|
|
|
|
|
|
|
Basic, US$ |
|
0.24 |
|
|
0.08 |
|
|
0.34 |
|
|
0.15 |
|
Diluted, US$ |
|
0.24 |
|
|
0.08 |
|
|
0.34 |
|
|
0.15 |
|
(1) Reversal of tax benefit
related to the social security cost component of share-based
remuneration and deferred taxes on the amortization of
acquired intangible assets. |
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