Ozon Holdings PLC (NASDAQ and MOEX: “OZON”, thereafter referred
to as “we”, “us”, “our”, “Ozon” or the “Company”), an operator of
the leading Russian e-commerce platform, announces its unaudited
financial results for the first quarter ended March 31, 2022.
First Quarter 2022 Financial and Operating Highlights
- Number of orders demonstrated substantial growth of 173%
year-on-year to 93.0 million compared to 34.1 million orders in Q1
2021 driven by the customer base expansion and greater user
engagement.
- GMV incl. services reached RUB 177.5 billion in Q1 2022
with 139% year-on-year growth, compared to RUB 74.2 billion in Q1
2021, underpinned by the strong order growth.
- Number of active buyers rose by 79% year-on-year to 28.7
million as of March 31, 2022, compared to 16.0 million as of March
31, 2021. Cohort performance improved with an annual order
frequency of Ozon’s customers increasing by 66% year-on-year to 9.8
orders in Q1 2022, compared to 5.9 in Q1 2021. An uptick in the
order frequency is attributable to higher customer loyalty and
engagement.
- The number of active sellers on the marketplace
increased to more than 120 thousand merchants as of Q1 2022, which
represents close to 3.5x growth compared to Q1 2021. Ozon platform
provides sellers with a unique access to 28.7 million active users,
a wide range of fulfillment and delivery services and a
comprehensive suite of market intelligence and analytical tools,
advertising solutions and financial services, all of which support
merchant base expansion.
- Assortment increased by more than 5x year-on-year and
reached more than 100 million SKUs in Q1 2022, compared to 19
million SKUs in Q1 2021, driven by a substantial growth in the
merchant base and smoother content creation process.
- Share of Marketplace climbed to 70.4% as a percentage of
GMV incl. services in Q1 2022, compared to 58.4% in Q1 2021,
supported by the seller base more than tripling year-on-year and
assortment expansion.
- Total revenue demonstrated 90% year-on-year growth to
RUB 63.6 billion in Q1 2022, compared to RUB 33.4 billion in Q1
2021, following significant GMV growth, solid 1P business
performance as well as growth in service revenue due to an increase
in marketplace commissions and advertising revenue.
- Adjusted EBITDA was negative RUB 8.9 billion, which
represents Adjusted EBITDA as a percentage of GMV incl. services of
negative 5.0%, compared to negative 9.0% in Q4 2021 and to negative
6.5% in Q1 2021. This marks a notable improvement in Adjusted
EBITDA as a percentage of GMV incl. services driven by higher gross
profit as a percentage of GMV incl. services, and efficiency
improvements in operating expenses due to economies of scale.
- Net cash used in operating activities was RUB 29,767
million in Q1 2022 compared to net cash used in operating
activities of RUB 12,118 million in Q1 2021. Free Cash Flow
was negative RUB 46,919 million in Q1 2022, compared to negative
RUB 14,753 million in Q1 2021, largely due to the fact that the
Company accelerated purchases of equipment, including IT and
warehouse equipment, to ensure uninterrupted supply.
Summary: Key Operating and Financial Metrics
The following table sets forth a summary of key operating and
financial data for the quarter ended March 31, 2022. The unaudited
quarterly information for the three months ended March 31, 2022 and
the three months ended March 31, 2021 has not been audited by the
Company’s auditors. The unaudited quarterly information includes
all normal recurring adjustments that we consider necessary for a
fair statement of the information shown.
(RUB in millions, unless indicated
otherwise)
For the three months ended
March 31 (unaudited),
2022
2021
YoY change, %
GMV incl. services
177,449
74,208
139
%
Number of orders, million
93.0
34.1
173
%
Number of active buyers, million
28.7
16.0
79
%
Share of Marketplace GMV, %
70.4
%
58.4
%
12.0pp
Total revenue
63,579
33,407
90
%
Gross profit
30,716
11,587
165
%
Gross profit as a percentage
of GMV incl. services, %
17.3
%
15.6
%
1.7pp
Contribution Profit / (Loss)
1,742
(134
)
—
Adjusted EBITDA
(8,946
)
(4,855
)
—
Adjusted EBITDA as a percentage
of GMV incl. services, %
(5.0
%)
(6.5
%)
1.5pp
Loss for the period
(19,055
)
(6,734
)
—
Net cash used in operating activities
(29,767
)
(12,118
)
—
Free Cash Flow
(46,919
)
(14,753
)
—
Note that Adjusted EBITDA and Free cash flow are non-IFRS
financial measures. See “Presentation of Financial and Other
Information” section of this press release for a definition of such
non-IFRS measures, a discussion of the limitations on their use,
and reconciliations of the non-IFRS measures to the applicable IFRS
measures. See the definitions of metrics such as GMV incl.
services, Gross Profit, number of orders, number of active buyers,
number of active sellers and share of Marketplace GMV in the “Other
Key Operating Measures” section of this press release.
Ozon Operational and Financial Results
The following table sets forth financial data for the quarter
ended March 31, 2022. The unaudited quarterly information for the
three months ended March 31, 2022 and the three months ended March
31, 2021 has not been audited by the Company’s auditors. The
unaudited quarterly information includes all normal recurring
adjustments that we consider necessary for a fair statement of the
information shown.
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
YoY change, %
Sales of goods
39,267
24,364
61
%
Service revenue
24,312
9,043
169
%
Marketplace commissions
18,797
6,985
169
%
Advertising revenue
3,642
1,360
168
%
Delivery services
1,518
481
216
%
Travel commissions
127
113
12
%
Other revenue
228
104
119
%
Total revenue
63,579
33,407
90
%
Cost of sales
(32,863
)
(21,820
)
51
%
Gross profit
30,716
11,587
165
%
Gross profit as a percentage of GMV incl.
services, %
17.3
%
15.6
%
1.7pp
Revenue
Ozon’s total revenue grew by 90% year-on-year and reached RUB
63.6 billion in Q1 2022, compared to RUB 33.4 billion in Q1 2021.
The growth was attributable to a 61% increase in sales of goods and
a 169% increase in service revenue due to a notable inflow from
marketplace commissions and advertising revenue.
Sales of goods
Sales of goods reached RUB 39.3 billion in Q1 2022, compared to
RUB 24.4 billion in Q1 2021, increasing by 61% year-on-year due to
an expanded active customer base of 28.7 million users and a higher
order frequency.
Service revenue
Ozon service revenue grew by 169% year-on-year to RUB 24.3
billion in Q1 2022 from RUB 9.0 billion in Q1 2021 due to an
increase in revenues from advertising services and marketplace
commissions driven by strong order growth and an expanding merchant
base on Ozon Marketplace.
Marketplace commissions
Marketplace commissions increased by 169% year-on-year to RUB
18.8 billion in Q1 2022, compared to RUB 7.0 billion in Q1 2021,
due to strong GMV performance, higher share of marketplace,
significant order growth and approximately 3.5х higher merchant
base.
Advertising revenue
Advertising revenue reached RUB 3.6 billion in Q1 2022, compared
to RUB 1.4 billion in Q1 2021, growing by 168% year-on-year on the
back of growth and greater adoption of advertising services, as a
result of enhanced advertising tools offered by Ozon to its seller
base, as well as a significantly higher number of merchants
engaging with the platform.
Cost of sales
Cost of sales increased by 51% year-on-year in Q1 2022. This was
attributed to growth in Direct Sales (1P operations) due to
customer base expansion and rising order frequency resulting in
higher order growth.
Gross Profit
Gross profit increased by 165% year-on-year in Q1 2022,
surpassing GMV growth of 139%, and reaching RUB 30.7 billion,
compared to RUB 11.6 billion in Q1 2021. The growth in gross profit
is primarily attributed to greater order volume and an increase in
revenue from sales of goods. As a percentage of GMV incl. services
gross profit increased by 1.7 p.p. to 17.3% in Q1 2022, compared to
15.6% in Q1 2021, which is mainly attributable to changes in the
Marketplace commission structure.
Contribution Profit / (Loss)
Contribution profit amounted to RUB 1,742 million in Q1 2022,
compared to loss RUB 134 million in Q1 2021 due to an increase in
gross profit.
Operating Expenses (RUB in
millions)
For the three months ended
March 31 (unaudited),
2022
20211
YoY change, %
Cost of sales
32,863
21,820
51
%
as % of GMV incl. services
18.5
%
29.4
%
(10.9pp)
Fulfillment and delivery
28,974
11,721
147
%
as % of GMV incl. services
16.3
%
15.8
%
0.5pp
Sales and marketing
7,461
3,677
103
%
as % of GMV incl. services
4.2
%
5.0
%
(0.8pp)
Technology and content
5,310
1,757
202
%
as % of GMV incl. services
3.0
%
2.4
%
0.6pp
General and administrative
4,658
1,776
162
%
as % of GMV incl. services
2.6
%
2.4
%
0.2pp
Total operating expenses
79,266
40,751
95
%
as % of GMV incl. services
44.7
%
54.9
%
(10.2pp)
Operating expenses
Operating expenses increased by 95% year-on-year in Q1 2022
relative to Q1 2021 due to growth in order volumes, infrastructure
expansion and the effect of investments in product and talent
acquisition from Q2 2021 until the end of 2021. As a percentage of
GMV incl. services, operating expenses decreased significantly to
negative 44.7% in Q1 2022 compared to negative 54.9% in Q1 2021.
Unit economics per order demonstrated a notable improvement both
year-on-year and quarter-on-quarter due to operating leverage and
benefits of scale.
Fulfillment and delivery
The 147% increase year-on-year in fulfillment and delivery costs
in Q1 2022 was driven by a higher number of orders processed
through Ozon’s infrastructure and temporary cost pressure arising
from underutilization of the recently launched warehouse
facilities. This was also reflected in fulfillment and delivery
costs rising by 0.5 p.p. to 16.3% as a percentage of GMV incl.
services in Q1 2022, compared to 15.8% in Q1 2021. However,
sequentially fulfillment and delivery costs decreased as a
percentage of GMV incl. services to 16.3% in Q1 2022, compared to
17.8% in Q4 2021, due to Ozon’s strong focus on cost optimization
and increasing utilization of the recently launched fulfillment
facilities.
Sales and marketing
Sales and marketing expenses increased by 103% year-on-year in
Q1 2022. As a percentage of GMV incl. services, sales and marketing
expenses decreased by 0.8 p.p. to 4.2%, compared to 5.0% in Q1 2021
due to marketing expenditure optimization to achieve greater
efficiency.
Technology and content
The 202% year-on-year increase in the technology and content
costs in Q1 2022 was driven by continued IT talent acquisition and
investments in product development. As a percentage of GMV incl.
services, technology and content costs increased by 0.6 p.p. to
3.0% in Q1 2022, compared to 2.4% in Q1 2021.
General and administrative
General and administrative costs increased by 162% year-on-year
in Q1 2022 relative to Q1 2021 due to higher employee expenses
primarily related to talent acquisition aimed at supporting
platform development, which accelerated from Q2 2021 through to the
end of the year in 2021. As a percentage of GMV incl. services
general and administrative costs increased by 0.2 p.p. to 2.6% in
Q1 2022 compared to 2.4% in Q1 2021, but edged down versus 2.7% in
Q4 2021 due to our concerted efforts around cost optimization.
Adjusted EBITDA
Adjusted EBITDA was negative RUB 8.9 billion in Q1 2022, which
corresponds to Adjusted EBITDA as a percentage of GMV incl.
services of negative 5.0%, compared to negative 6.5% in Q1 2021 and
to 9.0% in Q4 2021. The improvement of Adjusted EBITDA as a
percentage of GMV incl. services both year-on-year and
quarter-on-quarter resulted from the operating leverage, benefits
of the economies of scale and gross profit margin enhancement, as
well as ongoing efforts to improve cost controls.
Interest expense
Interest expense was RUB 2,416 million in Q1 2022, compared to
RUB 914 million in Q1 2021, driven by an increase in outstanding
borrowings and greater lease liabilities.
Interest income
Ozon interest income was RUB 994 million in Q1 2022, compared to
RUB 212 million in Q1 2021, due to higher deposit levels.
Foreign currency exchange gain, net
Foreign exchange gain was RUB 6,422 million in Q1 2022, compared
to a gain of RUB 1,791 million in Q1 2021, driven by a change in
foreign currency holdings and U.S. dollar exchange rate
fluctuations.
Income tax expense
Income tax expense was RUB 361 million in Q1 2022, compared to
expense RUB 56 million in Q1 2021.
Loss for the period
Loss for the period amounted to RUB 19,055 million in Q1 2022,
compared to loss RUB 6,734 million in Q1 2021, as a result of the
greater operating loss, higher interest expense, as well as the
negative impact of the remeasurement of convertible bonds which was
partly offset by the foreign exchange gain.
Shares Issued
The total number of shares issued and outstanding as of March
31, 2022 was 216,413,735 (comprised of 216,413,733 ordinary shares
and two Class A shares).
Share-Based Compensation
Share-based compensation expense amounted to RUB 2,729 million
in Q1 2022, compared to RUB 750 million in Q1 2021, partly due to a
greater number of participants in the Employee Stock Ownership
Plan.
Net Cash Used in Operating Activities
Net cash used in operating activities was RUB 29,767 million in
Q1 2022 compared to net cash used in operating activities of RUB
12,118 million in Q1 2021, due to greater cash outflow on the back
of higher trade payables and an increase in operating costs.
Working Capital
The Company’s working capital is mainly comprised of trade and
other payables and inventory. The accounts payable mainly include
trade payables for the products purchased from suppliers and
payables to the third-party sellers on Ozon Marketplace. As of
March 31, 2022, accounts payable amounted to RUB 63,743 million,
compared to RUB 89,273 million as of December 31, 2021 reflecting
business seasonality.
The Company’s inventories mainly include merchandise held for
resale and goods in transit, associated with our Direct (1P) Sales.
As of March 31, 2022 Ozon recorded RUB 23,541 million of
inventories, compared to RUB 26,362 million as of December 31,
2021.
Capital Expenditures
Company’s capital expenditures amounted to RUB 15,415 million in
Q1 2022, compared to RUB 1,955 million in Q1 2021, which included
payments for fulfillment facilities and computer equipment and
hardware.
Free Cash Flow
Free Cash Flow was negative RUB 46,919 million in Q1 2022,
compared to negative RUB 14,753 million in Q1 2021 due to a higher
level of outflows associated with the settlement of trade payables,
increase in operating expenses, as well as accelerated purchases of
IT, warehouse and other equipment to ensure uninterrupted
supply.
Convertible Bonds
As a result of the suspension of the ADS trading on Nasdaq, a
Delisting Event under the Bonds occurred following the close of
trading on March 8, 2022. Therefore, the holders of the Bonds
became entitled to require the Company to redeem their Bonds at the
principal amount together with accrued interest on the redemption
date, which is May 31, 2022. Accordingly, the Company revised the
schedule of cash flows underlying the amortized cost of the bonds
to reflect the revised contractual maturity. This revision resulted
in a remeasurement of the convertible bonds’ liability and a
reclassification of the revised carrying amount to short-term
borrowings. The effect of the remeasurement of RUB 8,567 million
was included in non-operating expenses. For further disclosure
regarding the Delisting Event, please refer to the Company’s press
release dated March 9, 2022.
Lease Liabilities and Commitments
The Group has lease contracts of office premises, fulfillment
and sorting centers, vehicles and pickup points. The increase in
right-of-use assets and lease liabilities as at March 31, 2022 as
compared to December 31, 2021 was primarily related to recognition
of RUB 12,943 million of right-of-use assets and RUB 12,494 million
of lease liabilities as a result of commencement of new leases as
well as modification of existing leases during the period. The
lease liabilities amounted to RUB 52,832 million as of March 31,
2022.
Cash and Cash Equivalents
Cash, cash equivalents and short-term bank deposits amounted to
RUB 92,461 million as of March 31, 2022, compared to RUB 125,991
million as of December 31, 2021.
Risk and uncertainties related to current environment
The sanctions imposed on Russia and Russian persons by a number
of countries in connection with the geopolitical crisis surrounding
Ukraine and further regulatory counter-measures taken by the
Russian Government, have had a significant, and in many cases
unprecedented, impact on companies operating in Russia. In response
to the geopolitical crisis surrounding Ukraine, the United States,
the European Union, the United Kingdom and other countries imposed
severe sanctions targeting Russian financial institutions,
including the prohibition on transactions with the Central Bank of
Russia, blocking of assets and cutting off certain Russian banks
from SWIFT; businessmen and their assets; and oil, defense and
other state-owned companies, as well as export and import
restrictions. In response, Russia identified a number of states,
including all European Union member states, the United States and
the United Kingdom, as “hostile” and introduced a number of
economic measures in connection with their actions, as well as
economic measures aimed at ensuring financial stability of
Russia.
As potential global and economic impacts of the geopolitical
crisis surrounding Ukraine continue to evolve rapidly,
unpredictable and outside the control of the Group it is difficult
to accurately predict the full impact of the sanctions that were
introduced or any measures taken by the Russian government in
response to such sanctions.
Sanctions imposed by the United States, the European Union, the
United Kingdom have had, and are expected to continue to have, a
material adverse effect on our business, financial condition and
results of operations and on the value and trading of the ADSs. We
may also face greater difficulties raising capital in the future,
which could potentially reduce the level of future investment into
infrastructure expansion and operations. We also cannot provide any
assurance that any further development in sanctions, or escalation
of the Ukraine situation more generally, will not have a
significant impact on our business, financial condition or results
of operations. The imposed sanctions in response to the ongoing
geopolitical crisis surrounding Ukraine and their impact on the
Russian economy may prevent us from achieving our financial,
operational and strategic objectives, including those described in
the Company’s Annual Report (Form 20-F) for the year ended December
31, 2021. See Item 3.D “Key Information—Risk Factors—Risks Relating
to Our Business and Industry—Sanctions imposed by the United
States, the European Union, the United Kingdom and other countries
in response to the geopolitical crisis surrounding Ukraine are
likely to have a material adverse effect on our business, financial
condition and results of operations and on the value and trading of
the ADSs” of the Annual Report for the year ended December 31,
2021.
Ozon Bank
On March 31, 2022, Ozon Bank was removed from the SDN List by
OFAC. For more details, please refer to the Company's press
releases dated March 31, 2022 and February 25, 2022.
Convertible Bonds
Following the occurrence of a Delisting Event, we have entered
into discussions with an Ad Hoc Committee of Bondholders and their
advisers in connection with a proposed consensual restructuring of
our financial indebtedness under the Bonds and aim to be in a
position to enter into a standstill agreement with a significant
number of holders of the Bonds in the near term with a view to
continue such discussions and to reach an agreement on the
long-term restructuring of the Bonds within the current financial
year.
As disclosed in the Company’s press release dated March 9, 2022,
following the Delisting Event a group of Bondholders has formed the
Ad Hoc Committee and appointed Houlihan Lokey, as its financial
adviser, and Akin Gump Strauss Hauer & Feld LLP, as its legal
adviser, to conduct an orderly discussion process with the Company
with a view to finding a fair and sustainable solution for all
stakeholders. To the extent any of the Bondholders are interested
in joining the Ad Hoc Committee or join the coordinated effort we
invite them to make inquiries to Houlihan Lokey at
projectondohl@hl.com.
Throughout the date of this press-release, substantial portion
of bondholders have exercised the rights to require redemption and
are entitled to receive principal amount together with accrued
interest on the redemption date, which is May 31, 2022. Due to,
among other things, the restrictions under the recently enacted
Russian capital controls and protection measures and continuing
multiple changes to the regulatory backdrop, the Company is
currently restricted from upstreaming cash funds from the Company’s
Russian subsidiaries to the Company. Therefore, there is a risk
that the Company will not have sufficient liquidity available at
the relevant time to fund the payments required for the redemption.
A failure to pay the amounts due under the redemption within 14
calendar days (i.e. by June 14, 2022) would result in an event of
default under the terms of the Bonds and would trigger a
cross-default on other Group’s liabilities. If the Group provided
to the Company the liquidity necessary to fund the early
redemption, such a redemption would result in a significant
reduction in the amount of liquidity available to fund operations
and would have a significant effect on our operations and growth
outlook.
Also, on May 9, 2022 BNY Mellon Corporate Trustee Services
Limited (the trustee under the Bonds) has notified the Company
that, as a result of adoption by the European Union of Council
Regulation (EU) 2022/576 of 8 April 2022 amending Regulation (EU)
No 833/2014, prohibiting the provision of services to trust
arrangements involving Russian nationals or Russian entities, from
10 May 2022 it would not be capable of acting as trustee under the
Bonds without exposure to the risk of financial or criminal
liability. The Company is currently evaluating possible
implications of the trustee’s determination, including in
connection with ongoing negotiations with an ad hoc group of
Bondholders.
Disclaimer
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that reflect the current views of Ozon Holdings PLC (“we”, “our” or
“us”, or the “Company”) about future events and financial
performance. All statements contained in this press release that do
not relate to matters of historical fact should be considered
forward-looking statements.
These forward-looking statements are based on management’s
current expectations. However, it is not possible for our
management to predict all risks, nor can we assess the impact of
all factors on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ
materially from those contained in any forward-looking statements
we may make. These statements are neither promises nor guarantees
but involve known and unknown risks, uncertainties and other
important factors and circumstances that may cause Ozon’s actual
results, performance or achievements to be materially different
from its expectations expressed or implied by the forward-looking
statements, including conditions in the U.S. capital markets,
negative global economic conditions, potential negative
developments in the COVID-19 pandemic, the geopolitical crisis
surrounding Ukraine and sanctions and governmental measures imposed
in response, other negative developments in Ozon’s business or
unfavorable legislative or regulatory developments. We caution you
therefore against relying on these forward-looking statements, and
we qualify all of our forward-looking statements by these
cautionary statements. Please refer to our Annual Report on Form
20-F for the year ended December 31, 2021 and other filings with
the SEC concerning factors that could cause actual results to
differ materially from those described in our forward-looking
statements.
These and other important factors could cause actual results to
differ materially from those indicated by the forward-looking
statements made in this press release. Any such forward-looking
statements represent management’s estimates as of the date of this
press release. While Ozon may elect to update such forward-looking
statements at some point in the future, Ozon disclaims any
obligation to do so, even if subsequent events cause its views to
change. These forward-looking statements should not be relied upon
as representing Ozon’s views as of any date subsequent to the date
of this press release.
This press release includes certain non-IFRS financial measures
not presented in accordance with IFRS, including but not limited to
Contribution (Loss)/(Profit), Adjusted EBITDA and Free Cash Flow.
These financial measures are not measures of financial performance
or liquidity in accordance with IFRS and may exclude items that are
significant in understanding and assessing our financial results.
Therefore, these measures should not be considered in isolation or
as an alternative to loss for the period or other measures of
profitability, liquidity or performance under IFRS. You should be
aware that the Company’s presentation of these measures may not be
comparable to similarly titled measures used by other companies,
which may be defined and calculated differently. See “Presentation
of Financial and Other Information” in this press release for a
reconciliation of certain of these non-IFRS measures from the most
directly comparable IFRS measure.
This press release includes quarterly information for the three
months ended March 31, 2022 and 2021. The quarterly information has
not been audited by the Company’s auditors.
The trademarks included herein are the property of the owners
thereof and are used for reference purposes only. Such use should
not be construed as an endorsement of the products or services of
the Company.
Ozon Holdings PLC
Interim Condensed Consolidated
Statement of Profit or Loss and Other Comprehensive Income
(in millions of Russian
Rubles)
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
20212
YoY change, %
Revenue:
Sales of goods
39,267
24,364
61
%
Service revenue
24,312
9,043
169
%
Total revenue
63,579
33,407
90
%
Operating expenses:
Cost of sales
(32,863
)
(21,820
)
—
Fulfillment and delivery
(28,974
)
(11,721
)
—
Sales and marketing
(7,461
)
(3,677
)
—
Technology and content
(5,310
)
(1,757
)
—
General and administrative
(4,658
)
(1,776
)
—
Total operating expenses
(79,266
)
(40,751
)
—
Operating loss
(15,687
)
(7,344
)
—
Net gain/(loss) on revaluation of
conversion options and other financial instruments
537
(479
)
—
Loss on disposal of non-current assets
(29
)
(5
)
—
Expected credit losses on financial
assets
(57
)
—
—
Interest expense
(2,416
)
(914
)
—
Interest income
994
212
—
Share of profit of an associate
109
61
—
Foreign currency exchange gain, net
6,422
1,791
—
Remeasurement of convertible bonds
(8,567
)
—
—
Total non-operating (expenses) /
income
(3,007
)
666
—
Loss before income tax
(18,694
)
(6,678
)
—
Income tax expense
(361
)
(56
)
—
Loss for the period
(19,055
)
(6,734
)
—
Ozon Holdings PLC
Interim Condensed Consolidated
Statement of Cash Flows
(in millions of Russian
Rubles)
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
Cash flows from operating
activities
Loss before income tax
(18,694
)
(6,678
)
Adjusted for:
Depreciation and amortization of
non-current assets
4,012
1,739
Interest expense
2,416
914
Interest income
(994
)
(212
)
Foreign currency exchange gain, net
(6,422
)
(1,791
)
Net (gain) / loss from revaluation of
conversion options and other financial instruments
(537
)
479
Write-downs and losses of inventories
(380
)
(7
)
Loss on disposal of non-current assets
29
5
Share of profit of an associate
(109
)
(61
)
Changes in expected credit losses and
impairment of non-financial assets
79
1
Remeasurement of convertible bonds
8,567
—
Share-based compensation expense
2,729
750
Changes in working capital:
Changes in inventories
3,182
(1,494
)
Changes in accounts receivable
1,749
725
Changes in advances paid and other
assets
(1,950
)
(538
)
Changes in trade accounts payable
(26,319
)
(5,062
)
Changes in other liabilities
5,018
479
Cash used in operations
(27,624
)
(10,751
)
Interest paid
(2,120
)
(1,316
)
Income tax paid
(23
)
(51
)
Net cash used in operating
activities
(29,767
)
(12,118
)
Ozon Holdings PLC
Interim Condensed Consolidated
Statement of Cash Flows (Continued)
(in millions of Russian
Rubles)
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
Cash flows from investing
activities
Purchase of property, plant and
equipment
(15,201
)
(1,914
)
Purchase of intangible assets
(214
)
(41
)
Return of bank deposits
18,297
—
Interest received
1,004
217
Dividends received from an associate
—
141
Issuance of loans
(163
)
—
Net cash generated from / (used in)
investing activities
3,723
(1,597
)
Cash flows from financing
activities
Convertible bond issue proceeds
—
54,499
Proceeds from borrowings
1,185
—
Proceeds of borrowings
(173
)
(6,122
)
Payment of principal portion of lease
liabilities
(1,737
)
(680
)
Net cash (used in) / generated from
financing activities
(725
)
47,697
Net (decrease) / increase in cash and
cash equivalents
(26,769
)
33,982
Cash and cash equivalents at the
beginning of the period
108,037
103,702
Effects of exchange rate changes on the
balance of cash held in foreign currencies
11,192
2,900
Cash and cash equivalents at the end of
the period
92,460
140,584
Ozon Holdings PLC
Interim Condensed Consolidated
Statement of Financial Position
(in millions of Russian
Rubles)
(RUB in millions)
As of
March 31, 2022
(unaudited)
December 31, 2021
Assets
Non-current assets
Property, plant and equipment
43,113
29,970
Right-of-use assets
49,746
39,940
Intangible assets
1,239
1,171
Investments in an associate
1,347
1,238
Deferred tax assets
48
80
Other financial assets
3,185
2,312
Other non-financial assets
59
41
Total non-current assets
98,737
74,752
Current assets
Inventories
23,541
26,362
Accounts receivable
4,860
6,611
VAT receivable
3,258
3,440
Other financial assets
202
75
Other non-financial assets
4,955
4,107
Short-term back deposits
1
17,954
Cash and cash equivalents
92,460
108,037
Total current assets
129,277
166,586
Total assets
228,014
241,338
Equity and liabilities
Equity
Share capital
12
12
Share premium
135,422
134,924
Treasury shares
(1
)
(1
)
Equity-settled employee benefits
reserves
10,031
7,800
Other capital reserves
12
(3
)
Accumulated deficit
(131,179
)
(112,124
)
Total equity
14,297
30,608
Ozon Holdings PLC
Interim Condensed Consolidated
Statement of Financial Position (Continued)
(in millions of Russian
Rubles)
(RUB in millions)
As of
March 31, 2022
(unaudited)
December 31, 2021
Non-current liabilities
Borrowings
2,873
50,577
Lease liabilities
43,462
34,770
Conversion options
—
594
Deferred tax liabilities
361
46
Deferred income
275
289
Other non-current liabilities
556
518
Total non-current liabilities
47,527
86,794
Current liabilities
Trade and other payables
63,743
89,273
Borrowings
73,727
11,539
Lease liabilities
9,370
7,697
Taxes payable
1,512
1,077
Accrued expenses
6,271
4,716
Contract liabilities and deferred
income
11,567
9,634
Total current liabilities
166,190
123,936
Total liabilities
213,717
210,730
Total equity and liabilities
228,014
241,338
Presentation of Financial and Other Information
Use of Non-IFRS Financial Measures
We report under International Financial Reporting Standards
(“IFRS”) as adopted by the International Accounting Standards Board
(the “IASB”). None of our financial statements were prepared in
accordance with generally accepted accounting principles in the
United States. We present our consolidated financial statements in
Rubles.
Certain parts of this press release contain non-IFRS financial
measures, including, among others, Contribution (Loss)/Profit,
Adjusted EBITDA and Free Cash Flow. We define:
- Contribution (Loss)/Profit as loss for the period before
income tax benefit/(expense), total non-operating income/(expense),
general and administrative expenses, technology and content
expenses and sales and marketing expenses.
- Adjusted EBITDA as loss for the period before income tax
benefit/(expense), total non-operating income/(expense),
depreciation and amortization and share-based compensation
expense.
- Free Cash Flow as net cash generated from/(used in)
operating activities less payments for purchase of property, plant
and equipment and intangible assets, and the payment of the
principal portion of lease liabilities.
Contribution (Loss)/Profit, Adjusted EBITDA and Free Cash are
used by our management to monitor the underlying performance of the
business and its operations. These measures are used by other
companies for a variety of purposes and are often calculated in
ways that reflect the circumstances of those companies. You should
exercise caution in comparing these measures as reported by us to
the same or similar measures as reported by other companies.
Contribution (Loss)/Profit, Adjusted EBITDA and Free Cash Flow may
not be comparable to similarly titled metrics of other companies.
These measures are unaudited and have not been prepared in
accordance with IFRS or any other generally accepted accounting
principles.
Contribution Profit/(Loss), Adjusted EBITDA and Free Cash Flow
are not measurements of performance or liquidity under IFRS or any
other generally accepted accounting principles, and you should not
consider them as an alternative to loss for the period, operating
loss, net cash generated from/(used in) operating activities or
other financial measures determined in accordance with IFRS or
other generally accepted accounting principles. These measures have
limitations as analytical tools, and you should not consider them
in isolation. Accordingly, prospective investors should not place
undue reliance on these non-IFRS financial measures contained in
this press release.
Other Key Operating Measures
Certain parts of this press release contain our key operating
measures, including, among others, gross merchandise value
including revenue from services (“GMV incl. services”), Gross
profit, share of our online marketplace (our “Marketplace”) GMV
(“Share of Marketplace GMV”), number of orders, number of active
buyers and number of active sellers. We define:
- GMV incl. services (gross merchandise value including
revenue from services) as the total value of orders processed
through our platform, as well as revenue from services to our
buyers, sellers and other customers, such as delivery, advertising
and other services. GMV incl. services is inclusive of value added
taxes, net of discounts, returns and cancellations. GMV incl.
services does not represent revenue earned by us. GMV incl.
services does not include travel ticketing and hotel booking
commissions, other related service revenues or value of the
respective orders processed.
- Gross profit as revenue less cost of sales in a given
period.
- Share of Marketplace GMV as the total value of orders
processed through our Marketplace, inclusive of value added taxes,
net of discounts, returns and cancellations, divided by GMV incl.
services in a given period. Share of Marketplace GMV includes only
the value of goods processed through our platform and does not
include services revenue.
- Number of orders as the total number of orders delivered
in a given period, net of returns and cancellations.
- Number of active buyers as the number of unique buyers
who placed an order on our platform within the 12-month period
preceding the relevant date, net of returns and cancellations.
- Number of active sellers as the number of unique
merchants who made a sale on our Marketplace within the 12-month
period preceding March 31, 2022.
Use of Non-IFRS Financial Measures
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
Contribution Profit / Loss (1)
1,742
(134
)
Adjusted EBITDA (2)
(8,946
)
(4,855
)
Free Cash Flow (3)
(46,919
)
(14,753
)
Gross Profit
30,716
11,587
(1) To provide investors with additional information regarding
our results of operations, we have disclosed here and elsewhere in
this press release Contribution (Loss)/Profit, a non-IFRS financial
measure that we calculate as loss for the period before income tax
benefit/(expense), total non-operating income/(expense), general
and administrative expenses, technology and content expenses and
sales and marketing expenses.
Contribution (Loss)/Profit is a supplemental non-IFRS measure of
our operating performance that is not required by, or presented in
accordance with, IFRS. We have included Contribution (Loss)/Profit
in this press release because it is an important metric used by our
management to measure our operating performance as it shows the
result of our operations less expense items that represent the
majority of our variable expenses.
Contribution (Loss)/Profit is an indicator of our operational
profitability as it reflects direct costs to fulfill and deliver
orders to our buyers. Accordingly, we believe that Contribution
(Loss)/Profit provides useful information to investors in
understanding and evaluating our operating results in the same
manner as our management and board of directors.
Contribution (Loss)/Profit excludes significant expense items,
including sales and marketing expenses, technology and content
expenses, general and administrative expenses and other expense
items that are not a direct function of sales. These expense items
are an integral part of our business. Given these and other
limitations, Contribution (Loss)/Profit should not be considered in
isolation, or as an alternative to, or a substitute for, an
analysis of our results reported in accordance with IFRS, including
operating loss and loss for the period.
The following tables present a reconciliation of loss for the
period to Contribution (Loss)/Profit for each of the periods
indicated:
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
20213
Loss for the period
(19,055
)
(6,734
)
Income tax expense
361
56
Total non-operating expense / (income)
3,007
(666
)
General and administrative expenses
4,658
1,776
Technology and content expenses
5,310
1,757
Sales and marketing expenses
7,461
3,677
Contribution Profit / (Loss)
1,742
(134
)
(2) To provide investors with additional information regarding
our results of operations, we have disclosed here and elsewhere in
this press release Adjusted EBITDA, a non-IFRS financial measure
that we calculate as loss for the period before income tax
benefit/(expense), total non-operating income/(expense),
depreciation and amortization and share-based compensation
expense.
Adjusted EBITDA is a supplemental non-IFRS financial measure
that is not required by, or presented in accordance with, IFRS. We
have included Adjusted EBITDA in this press release because it is a
key measure used by our management and board of directors to
evaluate our operating performance, generate future operating plans
and make strategic decisions regarding the allocation of capital.
In particular, the exclusion of certain expenses in calculating
Adjusted EBITDA facilitates operating performance comparability
across reporting periods by removing the effect of non-cash
expenses and non-operating income/(expense). Accordingly, we
believe that Adjusted EBITDA provides useful information to
investors in understanding and evaluating our operating results in
the same manner as our management and board of directors.
We believe it is useful to exclude non-cash charges, such as
depreciation and amortization and share-based compensation expense,
from our Adjusted EBITDA because the amount of such expenses in any
specific period may not directly correlate to the underlying
performance of our business operations. We believe it is useful to
exclude income tax benefit/(expense) and total non-operating
income/(expense) as these items are not components of our core
business operations. Adjusted EBITDA has limitations as a financial
measure, and you should not consider it in isolation or as a
substitute for loss for the period as a profit measure or other
analysis of our results as reported under IFRS. Some of these
limitations are:
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized may have to be replaced
in the future, and Adjusted EBITDA does not reflect capital
expenditure requirements for such replacements or for new capital
expenditures;
- Adjusted EBITDA does not reflect share-based compensation,
which has been, and will continue to be for the foreseeable future,
a recurring expense in our business and an important part of our
compensation strategy; and
- other companies, including companies in our industry, may
calculate Adjusted EBITDA differently, which reduces its usefulness
as a comparative measure.
Because of these limitations, you should consider Adjusted
EBITDA alongside other financial performance measures, including
various cash flow metrics, operating loss, loss for the period and
our other IFRS results.
The following table presents a reconciliation of loss for the
period to Adjusted EBITDA for each of the periods indicated:
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
Loss for the period
(19,055
)
(6,734
)
Income tax expense
361
56
Total non-operating expense / (income)
3,007
(666
)
Depreciation and amortization
4,012
1,739
Share-based compensation expense
2,729
750
Adjusted EBITDA
(8,946
)
(4,855
)
(3) To provide investors with additional information regarding
our liquidity, we have also disclosed here and elsewhere in this
press release Free Cash Flow, a non-IFRS financial measure that we
calculate as net cash generated from/(used in) operating activities
less capital expenditures, which consist of payments for purchase
of property, plant and equipment and intangible assets, and the
payment of the principal portion of lease liabilities.
Free Cash Flow is a supplemental non-IFRS financial measure that
is not required by, or presented in accordance with, IFRS. We have
included Free Cash Flow in this press release because it is an
important indicator of our liquidity as it measures the amount of
cash we generate/(use) and provide additional perspective on impact
of our cash capital expenditures and assets used by us through
lease obligations. Accordingly, we believe that Free Cash Flow
provides useful information to investors in understanding and
evaluating our operating results in the same manner as our
management and board of directors.
Free Cash Flow has limitations as a financial measure, and you
should not consider it in isolation or as substitutes for net cash
generated from/(used in) operating activities as a measure of our
liquidity or other analysis of our results as reported under IFRS.
There are limitations to using non-IFRS financial measures,
including that other companies, including companies in our
industry, may calculate Free Cash Flow differently. Because of
these limitations, you should consider Free Cash Flow alongside
other financial performance measures, including net cash generated
from/(used in) operating activities, capital expenditures and our
other IFRS results.
The following table presents a reconciliation of net cash
generated from/(used in) operating activities to Free Cash Flow for
each of the periods indicated:
(RUB in millions)
For the three months ended
March 31 (unaudited),
2022
2021
Net cash used in operating activities
(29,767
)
(12,118
)
Purchase of property, plant and
equipment
(15,201
)
(1,914
)
Purchase of intangible assets
(214
)
(41
)
Payment of principal portion of lease
liabilities
(1,737
)
(680
)
Free Cash Flow
(46,919
)
(14,753
)
About OZON
Ozon is a leading multi-category e-commerce platform and one of
the largest internet companies in Russia. Its fulfillment
infrastructure and delivery network have some of the widest
coverage among e-commerce players in the country, enabling Ozon to
provide Russian population with fast and convenient delivery via
couriers, pick-up points or parcel lockers. Its extensive logistics
footprint and fast-developing marketplace platform allow thousands
of entrepreneurs to sell their products across Russia’s 11 time
zones and offer millions of customers one of the widest selections
of goods across multiple product categories. Ozon actively seeks to
expand its value-added services such as fintech and other new
verticals such as Ozon fresh online grocery delivery. For more
information, please visit https://corp.ozon.com/.
1 In Q1 2022, we revised the presentation of expenses related to
maintenance of content of our marketplace platform, which resulted
in a corresponding reclassification of RUB 150 million in the first
quarter of 2021 from sales and marketing expenses to technology and
content expenses as compared to the amounts reported during
2021.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220526005805/en/
Investor Relations Maryia Berasneva-McNamara, Head of
Investor Relations, OZON ir@ozon.ru
Press Office Maria Zaikina, Director of Public &
Industry Relations, OZON pr@ozon.ru
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