Cian PLC (NYSE: CIAN, MOEX: CIAN) (“Cian” or the “Company”), a
leading online real estate classifieds platform in Russia, today
announced its financial results for the third quarter ended
September 30, 2021.
Third Quarter 2021 Key Financial and Operational
Highlights1
- Revenue increased by 44% Y-o-Y to RUB 1 557 million ($21.4
million).
- Adjusted EBITDA2 increased by 78% Y-o-Y to RUB 151 million
($2.1 million).
- Adjusted EBITDA Margin2 improved by 1.8 ppt Y-o-Y and reached
9.7%.
- Net loss for the period widened by 25% Y-o-Y to RUB 299 million
($4.1 million).
- Average UMV (Unique Monthly Visitors)3 increased by 4% Y-o-Y to
18.7 million.
- Core Business revenue increased by 41% Y-o-Y to RUB 1 470
million ($20.2 million).
- Core Business Adjusted EBITDA4 increased by 102% YoY to RUB 340
million ($4.7 million).
- Core Business Adjusted EBITDA Margin2,5 improved by 6.9 ppt
Y-o-Y and reached 23.1%.
__________________________
1 Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
2 Adjusted EBITDA, Adjusted EBITDA Margin
and Core Business Adjusted EBITDA Margin are non-IFRS measures. See
“Non-IFRS Financial Measures and Supplemental Financial
Information” elsewhere in this release for a description of these
measures and their reconciliation from the most directly comparable
IFRS financial measures.
3 Average Unique Monthly Visitors (UMV)
means the average number of users and customers visiting our
platform (websites and mobile application) per month in a
particular period, excluding bots. Average UMV for a particular
period is calculated by aggregating the UMV for each month within
such period and dividing by the number of months. For 2020, 2019
and their respective interim periods, Average UMV is calculated
based on Google Analytical data; for the third quarter of 2021,
Average UMV is calculated as a sum of Average UMV for the Cian
Group (excluding the N1 Group) based on Google Analytics data and
Average UMV for the N1 Group based on Yandex.Metrica data.
4 Core Business Adjusted EBITDA, Mortgage
Marketplace Adjusted EBITDA, Valuation and Analytics Adjusted
EBITDA, C2C Rental Adjusted EBITDA and End-to-End Offerings
Adjusted EBITDA presented in this release are our segment measures
of profit or loss and, therefore, are not considered non-IFRS
financial measures. The sum of Core Business Adjusted EBITDA,
Mortgage Marketplace Adjusted EBITDA, Valuation and Analytics
Adjusted EBITDA, C2C Rental Adjusted EBITDA and End-to-End
Offerings Adjusted EBITDA differs from Adjusted EBITDA because Core
Business Adjusted EBITDA, Mortgage Marketplace Adjusted EBITDA,
Valuation and Analytics Adjusted EBITDA, C2C Rental Adjusted EBITDA
and End-to-End Offerings Adjusted EBITDA include adjustments for
lease-related amortization and interest, capitalized development
costs, and operating expense related to software licenses. See
“Non-IFRS Financial Measures and Supplemental Financial
Information” elsewhere in this release for a description of these
measures.
5 Defined as Core Business Adjusted EBITDA
divided by Core Business revenue for the respective periods.
Adjusted EBITDA, Adjusted EBITDA Margin and Core Business Adjusted
EBITDA Margin are non-IFRS measures. See “Non-IFRS Financial
Measures and Supplemental Financial Information” elsewhere in this
release for a description of these measures and their
reconciliation from the most directly comparable IFRS financial
measures.
Third Quarter 2021 Product and Corporate Events
Highlights
- Re-launch of monetization in secondary residential and
commercial real estate verticals in 12 regions bringing the total
number of monetized regions to 21 (including Moscow, the Moscow
region, Saint Petersburg and the Leningrad region).
- Successful launch of Cian.Transaction, a new online transaction
service that enables execution of real estate transactions online,
including document checking, verification, signing, letter of
credit services and registration.
- Appointment of a Board of Directors, in connection with our
initial public offering (“IPO”), comprised of top technology and
property tech industry experts and finance professionals, including
Simon Baker (former CEO of REA Group and seasoned tech investor),
Chloe Harford (former senior vice president of strategy at Zillow
Group), Gilles Blanchard (founder of SeLoger and early investor in
Zameen) and Douglas Gardner (Board Member and Chair of Audit
Committee at Kaspi.kz).
Maxim Melnikov, Chief Executive Officer of Cian PLC commented:
“First and foremost I would like to congratulate everyone again on
our successful IPO. I want to thank our team for doing an amazing
job, growing, developing and leading Cian forward day by day since
our inception in 2001, our partners for their trust and for helping
us to enhance and improve our products and services, our
shareholders for supporting us and of course our investors – thank
you and welcome to the expanded family of shareholders of our
uniquely attractive business. Our management team is excited about
starting the new and exhilarating journey, where we would grow and
develop Cian together. Apart from our IPO, I am pleased to say that
this quarter we demonstrated strong growth, increasing our revenues
by 44% compared to the same period of the prior year, enhancing our
monetization and expanding our product portfolio. Our results
demonstrate the effectiveness of our monetization strategy in our
core markets as well as on a federal scale, increasing
attractiveness of our product and service proposition and Cian's
market leading position. We will continue to execute our strategy
investing in promoting and expanding our platform and building up a
wider end-to-end-value proposition for our users to ensure long
term growth and leadership of Cian.”
Third Quarter 2021 Results
Factors affecting year over year trends and comparisons6
When reviewing year over year dynamics for 2021 versus 2020 we
believe it is important to take into account certain factors that
affected the Russian real estate market demand and supply as well
as corresponding annual and quarterly trends in 2020. We believe
that quarterly trends in the real estate market in 2020 were
particularly characterized by the following events: (i) measures
introduced by the government to contain the spread of the COVID-19
pandemic including primarily lockdowns in Moscow and other regions
which led to a low level of real estate demand in the second
quarter of 2020 and correspondingly a low comparative base for the
same period of 2021; (ii) extensive economic stimulus including the
mortgage subsidy program introduced by the government shortly after
which led to historically low mortgage rates and resulted in
unusually high levels of real estate demand in the third quarter
2020 warranting a high comparative base for the same period of
2021. This was further amplified by the low level of supply of new
properties on the market impacted by a slowdown in construction due
to the COVID-19 pandemic resulting in significant decrease in the
number of properties available by the mid 2021. We believe that the
aforementioned factors and the corresponding fluctuation in real
estate market, which affected our revenues and results of
operations, were in some ways specific to 2020 and should be taken
into account when analyzing year over year dynamics for the
abovementioned periods and may not be representative of any future
trends.
__________________________
6 For the full disclosure of the Impact of
the COVID-19 pandemic on our operations and financial position
please see the relevant section of this release
Revenue Revenue for the three months ended September 30,
2021 amounted to RUB 1 557 million compared to RUB 1 081 million
for the three months ended September 30, 2020, demonstrating an
increase of RUB 476 million, or 44%. Revenue growth was primarily
driven by growth of the Core Business segment, as well as the
Mortgage Marketplace segment.
The following table sets forth a breakdown of our revenue by
segment and type for the periods indicated:
Three months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
Y-o-Y growth
RUB
RUB
USD (1)
Total Revenue
1 081
1 557
21.4
44%
Core Business, including
1 039
1 470
20.2
41%
Listing revenue
644
955
13.1
48%
Lead generation revenue
285
348
4.8
22%
Display advertising revenue
108
161
2.2
49%
Mortgage Marketplace
26
72
1.0
177%
Valuation and Analytics
15
7
0.1
(53%)
C2C Rental
1
1
0.0
0%
End-to-End Offerings
-
7
0.1
100%
1 Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
Core Business segment revenue Core business revenue
reached RUB 1 470 million for the three months ended September 30,
2021, increasing by 41% compared to RUB 1 039 million for the three
months ended September 30, 2020. Core business revenue growth was
driven by a positive performance across all key revenue streams –
listing revenue, representing secondary real estate and commercial
real estate verticals, as well as lead generation and display
advertising revenue, predominantly representing primary real estate
vertical.
Core business revenue in Moscow and the Moscow region for the
three months ended September 30, 2021 was RUB 1 058 million, an
increase of RUB 225 million or 27% compared to RUB 833 million for
the same period of the prior year. Core business revenue in other
Russian regions for the three months ended September 30, 2021 was
RUB 412 million, doubling as compared to RUB 206 million for the
same period of the prior year.
Listing revenue (secondary and commercial real estate verticals)
Listing revenue increased by 48% to RUB 955 million for the three
months ended September 30, 2021 from RUB 644 million for the same
period of the prior year.
The following table presents the listing revenue, the number of
listings and the average daily revenue per listing for the periods
indicated:
Three months ended (unaudited)
September30, 2020 September30,
2021 Y-o-Ygrowth Listing
revenue, including (RUB, million)
644
955
48%
Moscow and Moscow Region
511
640
25%
Other Russian Regions
133
315
137%
Listings(1), including (million)
2.38
1.90
(20%)
Moscow and Moscow Region
0.37
0.31
(17%)
Other Russian Regions
2.01
1.59
(21%)
Average
daily revenue per listing(2) (RUB)
3.0
5.5
86%
Moscow and Moscow Region
15.1
22.7
50%
Other Russian Regions
0.7
2.1
199%
1 Listings means the daily average number of real estate listings
posted on our platform by agents and individual sellers for a
particular period
2 Average daily revenue per listing is
calculated as listing revenue divided (i) by the total number of
listings for the corresponding period and (ii) by the number of
days during the period
We believe that the growth of the Сore Business listing revenue
was primarily driven by the following factors:
- re-launch of monetization of listing services following its
temporary suspension from April 2020 due to the COVID-19 pandemic.
This includes the effect of the listing services monetization
re-launch in Moscow, the Moscow region, St. Petersburg and the
Leningrad region in June 2020 that was partially offset by certain
discounts offered in the third quarter of 2020 as well as continued
re-launch of monetization in certain other Russian regions with the
total number of monetized regions (where base listing services in
both secondary residential and commercial listing are monetized)
reaching 21 (including our core markets of Moscow, the Moscow
region, Saint Petersburg and the Leningrad region) as of September
30, 2021;
- listings services price increase in the first quarter of 2021,
which was implemented as a part of regular review of listing
rates;
- increasing penetration of the subscription model with over 49%
of listing revenue coming from subscriptions in the three months
ended September 30, 2021 as compared to only 16% in the comparable
period of the prior year; and
- revenue contribution from the N1 Group, which was acquired in
February 2021.
Listing revenue growth was partially offset by changes into the
VAT exemption rules under the Russian Tax Code which came into
effect on January 1, 2021. Following such changes, we no longer
qualify for a VAT exemption applied prior to January 1, 2021 and
hence starting from beginning of this year, we bear the applicable
VAT in full.
In the three months ended September 30, 2021, we had
approximately 1.9 million listings on our platform (not including
the N1 Group), compared to approximately 2.4 million in the three
months ended September 30, 2020. The decrease in the number of
listings was predominantly driven by the temporary decrease in the
numbers of properties listed in the market following a period of an
active demand stimulated by the Russian government measures
described above. We do not expect the number of listed properties
to decline significantly going forward based on the market trends
we currently observe. In addition, the decrease in the number of
listings was amplified by re-launch of monetization in certain
regions throughout 2021. We observed that re-launches of
monetization customarily lead to removal of predominantly stale,
duplicate and otherwise illiquid listings.
Lead generation and display advertising revenue (primary real
estate vertical) Lead generation revenue increased by 22% to RUB
348 million in the three months ended September 30, 2021 from RUB
285 million in the three months ended September 30, 2020. Display
advertising revenue increased by 49% to RUB 161 million for the
three months ended September 30, 2021.
The growth of Core Business lead generation revenue was driven
mainly by the increase in the average revenue per lead to
developers. Increase in the average revenue per lead to developers
resulted primarily from price increases, which were introduced on
the lead generation products in April 2021 as well as the
enhancement and growing penetration of some of the value-added
services, such as the auction tool. The growth of the average
revenue per lead to developers was offset by a decline in the
number of leads to developers from approximately 75 thousand in the
third quarter 2020 to approximately 57 thousand in the third
quarter 2021. The decline in the number of leads to developers was
driven by several factors including predominantly abnormally high
levels of real estate demand in the third quarter 2020 as compared
to the third quarter 2021 driven by the Russian government’s
mortgage subsidy program that was initially launched in April 2020
and prolonged, but scaled back in July 2021. The pressure on the
number of leads was further exacerbated by the low level of supply
of new properties on the market impacted by a slowdown in
construction due to the COVID-19 pandemic. The decline in the
number of leads to developers was further balanced by the growth of
online display advertising driven by shift of developers
advertising budgets from offline advertising channels to
online.
Mortgage Marketplace segment revenue Mortgage Marketplace
revenue was RUB 72 million for the three months ended September 30,
2021 compared to RUB 26 million for the same period of the prior
year, corresponding to an increase of RUB 46 million or 177% driven
by run over effects of the strong performance of the overall
mortgage market in the first half of 2021 (resulting largely from
the governmental mortgage subsidy support) underpinned by the
promotion and development of the Mortgage Marketplace service
including the addition of two new banks to the platform.
Operating expenses Total operating expenses increased by
41% to RUB 1 842 million in the three months ended September 30,
2021 from RUB 1 302 million in the three months ended September 30,
2020, primarily driven by an increase in employee-related,
marketing and IT expenses.
The following table sets forth a breakdown of our operating
expenses for the periods indicated:
Three months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
Y-o-Y growth
RUB
RUB
USD (1)
Operating expenses
1 302
1 842
25.3
41%
Marketing expenses
503
593
8.1
18%
Employee-related expenses, including
645
916
12.6
42%
Wages, salaries and related taxes
384
568
7.8
48%
Share-based payment expense
254
315
4.3
24%
IT expenses
64
144
2.0
125%
Depreciation and amortization
52
72
1.0
38%
Other operating expenses, including
38
117
1.6
208%
IPO related expenses
-
49
0.7
100%
1 Dollar translations throughout this release are included
solely for the convenience of the reader and were calculated at the
exchange rate quoted by the Central Bank of Russia as of September
30, 2021 (RUB 72.7608 to USD 1.00)
Employee-related expenses Employee-related expenses increased by
42% to RUB 916 million in the three months ended September 30, 2021
from RUB 645 million in the three months ended September 30, 2020.
Wages, salaries and related taxes and other employee related
expenses were a total of RUB 601 million for the three months ended
September 30, 2021 compared to RUB 391 million for the three months
ended September 30, 2020. This increase was primarily due to growth
in headcount, driven by the roll-out of some of the new
initiatives, the acquisition of the N1 Group and hirings in
preparation for the IPO.
Wages, salaries and related taxes as a percentage of revenue was
flat year over year amounting to approximately 36%.
Marketing expenses Marketing expenses increased to RUB 593
million in the three months ended September 30, 2021 from RUB 503
million in the three months ended September 30, 2020. This increase
was primarily driven by growth in online and offline marketing,
following the end of the COVID-19 lockdown-related restrictions and
the implementation of our marketing strategy.
Marketing expenses as a percentage of revenue decreased to 38.1%
in the third quarter of 2021 from 46.5% in the third quarter of
2020, driven primarily by the increase in revenue.
IT expenses IT expenses increased by 125% to RUB 144 million in
the three months ended September 30, 2021 from RUB 64 million in
the three months ended September 30, 2020. This increase was
primarily driven by our transition to cloud hosting services,
expansion of our call tracking as well as the acquisition of the N1
Group.
Other operating expenses Other operating expenses increased by
208% to RUB 117 million in the three months ended September 30,
2021 from RUB 38 million in the three months ended September 30,
2020, primarily driven by the IPO-related expenses.
Adjusted EBITDA and Adjusted EBITDA Margin Adjusted
EBITDA for the three months ended September 30, 2021 reached RUB
151 million, an increase of RUB 66 million, or 78% compared to RUB
85 million for the three months ended September 30, 2020. The
growth in Adjusted EBITDA was primarily driven by the increase in
revenue as well as operating leverage in our business.
Adjusted EBITDA Margin improved by 1.8 ppt reaching 9.7% for the
three months ended September 30, 2021.
Core Business Adjusted EBITDA increased by 102% to RUB 340
million in the three months ended September 30, 2021 from RUB 168
million in the three months ended September 30, 2020. This increase
was driven primarily by revenue growth of the Core Business
segment, including the growth in listing, lead generation and
display advertising revenue that outpaced the growth of Core
Business operating expenses.
Core Business Adjusted EBITDA Margin improved by 6.9 ppt
reaching 23.1% for the three months ended September 30, 2021.
Mortgage Marketplace Adjusted EBITDA was a negative RUB 120
million in the three months ended September 30, 2021 compared to a
negative RUB 65 million in the three months ended September 30,
2020. The dynamic was primarily driven by our investments in
marketing associated with the promotion and development of the
project and was partially offset by growth in revenue generated by
the Mortgage Marketplace platform.
Net loss Loss for the three months ended September 30,
2021 was RUB 299 million compared to a loss of RUB 240 million for
the three months ended September 30, 2020. The change in net loss
was driven by factors affecting our Adjusted EBITDA and offset by
an increase in the share-based payment expenses as well as
IPO-related expenses.
Recent Developments Settlement of the Phantom Share
Program Prior to the IPO, we had a long-term incentive program for
certain senior employees, which provided for cash payments based on
the value of our ordinary shares upon occurrence of certain
liquidity events, such as the IPO (the "Phantom Share Program").
The amount of the cash payment in respect of a vested phantom share
is determined based on the increase in our ordinary share price
between the grant date and the time of payment. In connection with
the IPO, we amended the terms of the long-term incentive program,
such that the employees may choose to receive payment for vested
phantom shares in cash or in ordinary shares upon the completion of
this offering.
Starting from 2015, we have granted phantom share awards
equivalent to an aggregate of 4,923,042 phantom shares to 30
employees (including four former employees), 69.0% of which have
vested by the IPO date.
Consequently, to satisfy our outstanding obligations under the
Phantom Share Program that arose as a result of the IPO, we plan to
pay approximately $29.4 million in cash and issue approximately
829,000 ordinary shares to our employees, including our CEO and
CFO. The Phantom Share Program terminated upon completion of the
IPO.
Outlook The following forward-looking statement reflects
our expectations regarding our performance as of November 24,
2021:
We currently expect our revenue to grow in the range of 45% to
48% compared to 2020.
This outlook reflects our current views and expectations only
and is based on the trends we see as of the day of this press
release. If such trends were to deteriorate or improve further the
impact on our business and operations could deviate from than
currently expected.
The Company reserves the right to revise guidance in the course
of the year or when additional information regarding the effect of
the ongoing events becomes available.
Impact of COVID-19 on Our Operations and Financial
Position Since its outbreak in December 2019 to date, the
COVID-19 pandemic has impacted our business operations and demand
across all customer and user groups. Similarly to other countries,
at several points in 2020, Russian federal and local government
authorities introduced measures aimed at preventing the further
spread of COVID-19, including, among others, lockdowns, bans on
public events, closures of public places, border controls, travel
restrictions and widespread “work-from-home” measures. For example,
in March 2020, to slow the spread of COVID-19, the Russian
government imposed a country-wide lockdown. In June 2021 and in
September – November 2021, there have been further spikes in the
spread of COVID-19 in Moscow and numerous other Russian regions,
and the governmental authorities introduced a number of
recommendations and restrictions.
The COVID-19 pandemic, its broad impact and preventive measures
taken to contain or mitigate the pandemic have had, and are likely
to continue to have, significant negative effects on the Russian
and global economy, employment levels, employee productivity,
residential and commercial real estate and financial markets. This,
in turn, has and may increasingly have a negative impact on our
customers and users, their ability to effectuate real estate
transactions, and in turn, our profitability and ability to operate
our business.
In 2020, in response to the COVID-19 pandemic, we introduced
several measures to mitigate its effects on our business as well as
customer and user base. Specifically, to support our customers in
these unprecedented circumstances, from April 2020, we temporarily
offered our listing services free of charge across all cities and
regions. The monetization of our listings in Moscow, the Moscow
region, St. Petersburg and the Leningrad region was reinstated in
July 2020, with certain discounts offered in the third quarter of
2020. In the second and third quarters of 2021, we also reinstated
monetization in some additional regions, bringing the number of
monetized regions to 21. The monetization in other regions remains
temporarily suspended and its potential reintroduction is being
assessed on a region by region basis.
Furthermore, during the COVID-19 pandemic crisis in 2020, we
optimized our marketing and advertising expenses in order to align
our marketing budgets with the suspension in monetization discussed
above. Additionally, we also reduced discretionary spending and
paused hiring for non-critical roles. Overall, we believe that the
combination of these cost optimization efforts and changes in our
monetization approach helped us to address the COVID-19 pandemic
crisis in 2020.
The broader macroeconomic environment remains highly uncertain,
and we are continuing to closely monitor the impact of the COVID-19
pandemic on our market, customers, users and business, which may
continue to affect our financial results going forward.
Third Quarter 2021 Financial Results Conference Call
Cian will host a conference call and webcast on Wednesday,
November 24, 2021 at 8:30 a.m. ET (4.30 p.m. Moscow) to review its
third quarter 2021 financial results.
To participate in the conference call, please use the following
details:
Russia dial-in (local):
+7 495 2839 705
United Kingdom (local):
020 3936 2999
United States (local):
+1 646 664 1960
All other locations:
+44 20 3936 2999
Access code:
642784
Our join the webcast:
https://streams.eventcdn.net/cianplc/2021-q3
About Cian
Cian is a leading online real estate classifieds platform in the
large, underpenetrated and growing Russian real estate classifieds
market, with a strong presence across Russia and leading positions
in the country’s key metropolitan areas. The Company ranks among
the top ten most popular online real estate classifieds globally in
terms of traffic (based on SimilarWeb traffic data for other online
real estate classifieds and Google Analytics data for Cian for
September 2021). Cian’s networked real estate platform connects
millions of real estate buyers and renters to millions of
high-quality real estate listings of all types — residential and
commercial, primary and secondary, urban and suburban. In the third
quarter of 2021, the Company had over 1.9 million listings
available through its platform and an average UMV of over 18.7
million. Through its technology-driven platform and deep insights
into the Russian real estate market the Company provides an
end-to-end experience for its customers and users and helps them
address multiple pain points on their journey to a new home or
place to work.
Source: Cian PLC
Forward-Looking Statements This press release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Any express or implied
statements contained in this press release that are not statements
of historical fact may be deemed to be forward-looking statements,
including, without limitation, statements regarding our financial
outlook for 2021 and long-term growth strategy, as well as
statements that include the words “target,” “believe,” “expect,”
“aim,” “intend, intend,” may,” “anticipate,” “estimate,” “plan,”
“project,” “will,” “can have,” “likely,” “should,” “would,” “could”
and other words and terms of similar meaning or the negative
thereof. Forward-looking statements are neither promises nor
guarantees, but involve known and unknown risks and uncertainties
that could cause actual results to differ materially from those
projected, including, without limitation: our ability to maintain
our leading market positions, particularly in Moscow, St.
Petersburg and certain other regions, and our ability to achieve
and maintain leading market position in certain other regions; our
ability to compete effectively with existing and new industry
players in the Russian real estate classifieds market; our heavy
dependence on our brands and reputation; any potential failure to
adapt to any substantial shift in real estate transactions from, or
demand for services in, certain Russian geographic markets; any
downturns in the Russian real estate market and general economic
conditions in Russia; any effect on our operations due to
cancellation of, or any changes to, the Russian mortgage subsidy
program or other government support programs; further widespread
impacts of the COVID-19 pandemic, or other public health crises,
natural disasters or other catastrophic events which may limit our
ability to conduct business as normal; our ability to establish and
maintain important relationships with our customers and certain
other parties; any failure to establish and maintain proper and
effective internal control over financial reporting; any failure to
remediate existing deficiencies we have identified in our internal
controls over financial reporting, including our information
technology general controls; any new or existing government
regulation in the area of data privacy, data protection or other
areas and the other important factors discussed under the caption
“Risk Factors” in Cian’s prospectus pursuant to Rule 424(b) filed
with the U.S. Securities and Exchange Commission (“SEC”) on
November 4, 2021 and our other filings with the SEC as such factors
may be updated from time to time.
Any forward-looking statements contained in this press release
speak only as of the date hereof and accordingly undue reliance
should not be placed on such statements. We disclaim any obligation
or undertaking to update or revise any forward-looking statements
contained in this press release, whether as a result of new
information, future events or otherwise, other than to the extent
required by applicable law.
Unaudited Interim Condensed Consolidated Statement of Profit
or Loss and Other Comprehensive Income (in millions of RUB and USD,
except share and per share amounts)
Three months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Revenue
1 081
1 557
21.4
Operating expenses:
Marketing expenses
(503)
(593)
(8.1)
Employee-related expenses
(645)
(916)
(12.6)
IT expenses
(64)
(144)
(2.0)
Depreciation and amortization
(52)
(72)
(1.0)
Other operating expenses
(38)
(117)
(1.6)
Total operating expenses
(1 302)
(1 842)
(25)
Operating loss
(221)
(285)
(3.9)
Finance costs
(19)
(15)
(0.2)
Finance income
3
5
0.1
Foreign currency exchange loss, net
-
(1)
(0.0)
Loss before income tax
(237)
(296)
(4.1)
Income tax expense
(3)
(3)
(0.0)
Loss for the period
(240)
(299)
(4.1)
Total comprehensive loss for the
period
(240)
(299)
(4.1)
Loss per share
Basic and diluted loss per share
attributable to ordinary equity holders of the parent
(4)
(5)
(0.1)
Basic and diluted weighted average number
of ordinary shares, in thousand
59 433
65 000
65 000
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
Unaudited Interim Condensed Consolidated Statement of Profit
or Loss and Other Comprehensive Income (in millions of RUB and USD,
except share and per share amounts)
Nine months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Revenue
2 723
4 261
58.6
Operating expenses:
Marketing expenses
(1 139)
(1 722)
(23.7)
Employee-related expenses
(1 723)
(3 548)
(48.8)
IT expenses
(207)
(373)
(5.1)
Depreciation and amortization
(151)
(206)
(2.8)
Other operating expenses
(124)
(338)
(4.6)
Total operating expenses
(3 344)
(6 187)
(85)
Operating loss
(621)
(1 926)
(26.5)
Finance costs
(55)
(46)
(0.6)
Finance income
7
12
0.2
Foreign currency exchange loss, net
-
(28)
(0.4)
Loss before income tax
(669)
(1 988)
(27.3)
Income tax benefit
24
19
0.3
Loss for the period
(645)
(1 969)
(27.1)
Total comprehensive loss for the
period
(645)
(1 969)
(27.1)
Loss per share
Basic and diluted loss per share
attributable to ordinary equity holders of the parent
(11)
(31)
(0.4)
Basic and diluted weighted average number
of ordinary shares, in thousand
59 433
64 168
64 168
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
Unaudited Interim Condensed Consolidated Statement of
Financial Position (in millions of RUB and USD)
As of
December 31, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Assets
Non-current assets
Property and equipment
31
46
0.6
Right-of-use assets
125
110
1.5
Goodwill
-
785
10.8
Intangible assets
257
1 216
16.7
Deferred tax assets
237
248
3.4
Other non-current assets
9
17
0.2
Total non-current assets
659
2 422
33.3
Current assets
Advances paid and prepaid expenses
88
74
1.0
Trade and other receivables
154
258
3.5
Prepaid income tax
-
6
0.1
Cash and cash equivalents
449
849
11.7
Other current assets
20
111
1.5
Total current assets
711
1 298
17.8
Total assets
1 370
3 720
51.1
Equity and liabilities
Equity
Share capital
-
2
0.0
Share premium
125
2 416
33.2
Accumulated losses
(997)
(2 966)
(40.8)
Total equity
(872)
(548)
(7.5)
Liabilities
Non-current liabilities
Employee share-based payment liability
636
-
-
Lease liabilities
77
58
0.8
Deferred tax liabilities
28
138
1.9
Total non-current liabilities
741
196
2.7
Current liabilities
Employee share-based payment liability
-
2 421
33.3
Borrowings
728
450
6.2
Contract liabilities
332
381
5.2
Trade and other payables
316
573
7.9
Income tax payable
15
2
0.0
Other taxes payable
74
204
2.8
Lease liabilities
36
41
0.6
Total current liabilities
1 501
4 072
56.0
Total liabilities
2 242
4 268
58.7
Total liabilities and equity
1 370
3 720
51.1
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
Unaudited Interim Condensed Consolidated Statement of Cash
Flows (in millions of RUB and USD)
Nine months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Cash flows from operating
activities
Loss before income tax
(669)
(1 988)
(27.3)
Adjusted for:
Depreciation and amortization
151
206
2.8
Employee share-based payment expense
503
1 785
24.5
Finance income
(7)
(12)
(0.2)
Finance costs
55
46
0.6
Foreign currency exchange loss, net
-
28
0.4
Changes in allowances on trade receivables
and advances paid
-
3
0.0
Other non-cash items
(1)
2
0.0
Working capital changes:
Increase in trade and other
receivables
(68)
(97)
(1.3)
Decrease / (increase) in advances paid and
prepaid expenses
(10)
6
0.1
Increase in other assets
(13)
(57)
(0.8)
Increase in trade and other payables
41
190
2.6
Increase in contract liabilities
107
28
0.4
Increase in other liabilities
103
111
1.5
Cash generated from operating
activities
192
251
3.4
Income tax paid
(24)
(20)
(0.3)
Interest received
7
9
0.1
Interest paid
(54)
(45)
(0.6)
Net cash generated from operating
activities
121
195
2.7
Cash flows from investing
activities
Acquisition of a subsidiary, net of cash
acquired
-
(1 651)
(22.7)
Purchase of property and equipment
(15)
(37)
(0.5)
Purchase of intangible assets
(61)
(57)
(0.8)
Loan issued to a related party
-
(6)
(0.1)
Loans collected from employees
2
-
-
Net cash used in investing
activities
(74)
(1 751)
(24.1)
Cash flows from financing
activities
Proceeds from the issue of ordinary
shares
-
2 265
31.1
Proceeds from borrowings
320
-
-
Repayment of borrowings
-
(279)
(3.8)
Payment of principal portion of lease
liabilities
(50)
(29)
(0.4)
Net cash generated from financing
activities
270
1 957
26.9
Net increase in cash and cash
equivalents
317
401
5.5
Cash and cash equivalents at the beginning
of the period
148
449
6.2
Effect of exchange rate changes on cash
and cash equivalents
1
(1)
(0.0)
Cash and cash equivalents at the end of
the period
466
849
11.7
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
Non-IFRS Financial Measures and Supplemental Financial
Information
Use of Non-IFRS Financial Measures
We use Adjusted EBITDA, Core Business Adjusted EBITDA for Moscow
and the Moscow region, Core Business Adjusted EBITDA for Other
regions, Adjusted EBITDA Margin and Core Business Adjusted EBITDA
Margin as non-IFRS financial measure in assessing our operating
performance and in our financial communications.
Adjusted EBITDA, Core Business Adjusted EBITDA for Moscow and
the Moscow region, Core Business Adjusted EBITDA for Other regions,
Adjusted EBITDA Margin and Core Business Adjusted EBITDA Margin are
financial measures that are not calculated in accordance with IFRS.
These non-IFRS financial measures should not be considered in
isolation or as an alternative or a substitute to loss for the
period, which is the most directly comparable IFRS measure, or any
other measure of financial performance calculated and presented in
accordance with IFRS. Adjusted EBITDA, Core Business Adjusted
EBITDA for Moscow and the Moscow region, Core Business Adjusted
EBITDA for Other regions, Adjusted EBITDA Margin and Core Business
Adjusted EBITDA Margin have limitations as analytical tools. Some
of these limitations are:
- they exclude depreciation and amortization expense and,
although these are non-cash expenses, the assets being depreciated
may have to be replaced in the future, increasing our cash
requirements;
- they do not reflect interest expense, or the cash required to
service our debt, which reduces cash available to us;
- they do not reflect income tax payments that reduce cash
available to us;
- they do not reflect share-based compensation expenses and,
therefore, do not include all of our employee-related expenses;
and
- other companies, including companies in our industry, may
calculate those measures differently, which reduces their
usefulness as comparative measures.
The sum of Core Business Adjusted EBITDA, Mortgage Marketplace
Adjusted EBITDA, Valuation and Analytics Adjusted EBITDA, C2C
Rental Adjusted EBITDA and End-to-End Offerings Adjusted EBITDA
differs from Adjusted EBITDA because Core Business Adjusted EBITDA,
Mortgage Marketplace Adjusted EBITDA, Valuation and Analytics
Adjusted EBITDA, C2C Rental Adjusted EBITDA and End-to-End
Offerings Adjusted EBITDA presented in the table below are our
segment measures of profit or loss and, therefore, are not
considered non IFRS financial measures and include adjustments for
lease related amortization and interest, capitalized development
costs, and operating expense related to software licenses.
The tables below provide detailed reconciliations of each
non-IFRS financial measure we use from the most directly comparable
IFRS financial measure.
Reconciliation of Adjusted EBITDA from net loss for the
period, the most directly comparable IFRS financial measure
Three months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Loss for the period
(240)
(299)
(4.1)
Income tax expense
3
3
0.0
Loss before income tax
(237)
(296)
(4.1)
Depreciation and amortization
52
72
1.0
Finance expenses, net (2)
16
10
0.1
Foreign currency exchange loss, net
-
1
0.0
Share-based payment expenses
254
315
4.3
IPO-related costs
-
49
0.7
Adjusted EBITDA (3)
85
151
2.1
Adjusted EBITDA Margin (4)
7.9%
9.7%
9.7%
Nine months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Loss for the period
(645)
(1 969)
(27.1)
Income tax benefit
(24)
(19)
(0.3)
Loss before income tax
(669)
(1 988)
(27.3)
Depreciation and amortization
151
206
2.8
Finance expenses, net (2)
48
34
0.5
Foreign currency exchange loss, net
-
28
0.4
Share-based payment expenses
503
1 785
24.5
IPO-related costs
-
137
1.9
Adjusted EBITDA (3)
33
202
2.8
Adjusted EBITDA Margin (4)
1.2%
4.7%
4.7%
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
2Comprises finance costs and finance
income for the respective periods
3Defined as loss for the period adjusted
to exclude income tax benefit, finance costs, finance income,
foreign currency exchange loss, net, depreciation and amortization,
share-based payments under our equity-based incentive program
consisting of phantom share options and IPO-related costs
4 Defined as Adjusted EBITDA divided by
revenue for the respective periods
Segment Data and Reconciliation of Adjusted EBITDA, Core
Business Adjusted EBITDA, Mortgage Marketplace Adjusted EBITDA,
Valuation and Analytics Adjusted EBITDA, C2C Rental Adjusted EBITDA
and End-to-End Offerings Adjusted EBITDA2
Three months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Adjusted EBITDA
85
151
2.1
Capitalized development costs
(15)
-
-
Reclassification of lease related
amortization and interest
(19)
(12)
(0.2)
Reclassification of operating expense
related to software licenses to amortization
(8)
(14)
(0.2)
43
125
1.7
Core Business Adjusted EBITDA
168
340
4.7
Core Business Adjusted EBITDA for Moscow
and the Moscow region (3)
511
629
8.6
Core Business Adjusted EBITDA for Other
regions (3)
(343)
(289)
(4.0)
Mortgage Marketplace Adjusted EBITDA
(65)
(120)
(1.6)
Valuation and Analytics Adjusted
EBITDA
(26)
(10)
(0.1)
C2C Rental Adjusted EBITDA
(34)
(34)
(0.5)
End-to-End Offerings Adjusted EBITDA
-
(51)
(0.7)
Nine months ended
(unaudited)
September 30, 2020
September 30, 2021
September 30, 2021
RUB
RUB
USD(1)
Adjusted EBITDA
33
202
2.8
Capitalized development costs
(31)
-
-
Reclassification of lease related
amortization and interest
(56)
(42)
(0.6)
Reclassification of operating expense
related to software licenses to amortization
(22)
(34)
(0.5)
-76
126
1.7
Core Business Adjusted EBITDA
278
746
10.3
Core Business Adjusted EBITDA for Moscow
and the Moscow region (3)
1 129
1 699
23.4
Core Business Adjusted EBITDA for Other
regions (3)
(851)
(953)
(13.1)
Mortgage Marketplace Adjusted EBITDA
(162)
(352)
(4.8)
Valuation and Analytics Adjusted
EBITDA
(95)
(46)
(0.6)
C2C Rental Adjusted EBITDA
(97)
(105)
(1.4)
End-to-End Offerings Adjusted EBITDA
-
(117)
(1.6)
1Dollar translations throughout this
release are included solely for the convenience of the reader and
were calculated at the exchange rate quoted by the Central Bank of
Russia as of September 30, 2021 (RUB 72.7608 to USD 1.00)
2The sum of Core Business Adjusted EBITDA,
Mortgage Marketplace Adjusted EBITDA, Valuation and Analytics
Adjusted EBITDA, C2C Rental Adjusted EBITDA and End-to-End
Offerings Adjusted EBITDA differs from Adjusted EBITDA because Core
Business Adjusted EBITDA, Mortgage Marketplace Adjusted EBITDA,
Valuation and Analytics Adjusted EBITDA, C2C Rental Adjusted EBITDA
and End-to-End Offerings Adjusted EBITDA presented in the table
below are our segment measures of profit or loss and, therefore,
are not considered non IFRS financial measures and include
adjustments for lease related amortization and interest,
capitalized development costs, and operating expense related to
software licenses
3For the purpose of calculating Core
Business Adjusted EBITDA for Moscow and the Moscow region and Core
Business Adjusted EBITDA for Other regions: (i) revenues are
attributed to the relevant region based primarily on the location
of the relevant property listed; and (ii) costs are directly
attributed to the relevant region with respect to which they were
incurred, when possible. Due to the integrated structure of our
business, certain costs may benefit all our regions. These costs
primarily include certain headcount-related expenses, certain
marketing and advertising costs, product development, IT expenses
(including hosting and technical support expenses and
telecommunication services), office maintenance expenses and other
general corporate expenses, such as finance, accounting, legal,
human resources, recruiting and facilities costs. These costs are
allocated to Moscow and the Moscow region and Other regions based
on the estimated benefit each region receives from such expenses,
using specific allocation drivers representing this benefit
Other Historical Operational Data
Average UMV (1) (in
millions)
Listings (2) (in
millions)
Listings Moscow and the Moscow
region
Listings Other regions
Leads to developers (3) (in
thousands)
March 31, 2019
12.7
1.98
0.38
1.60
48.0
June 30, 2019
12.6
1.98
0.39
1.59
41.5
September 30, 2019
14.0
1.92
0.37
1.55
45.8
December 31, 2019
14.1
1.78
0.35
1.43
44.3
March 31, 2020
15.5
1.74
0.32
1.42
54.1
June 30, 2020
14.9
2.30
0.46
1.83
50.0
September 30, 2020
18.0
2.38
0.37
2.01
75.2
December 31, 2020
17.6
2.14
0.32
1.82
66.0
March 31, 2021
21.0
2.04
0.30
1.74
60.4
June 30, 2021
19.7
2.25
0.32
1.93
53.5
September 30, 2021
18.7
1.90
0.31
1.59
57.4
1 Average Unique Monthly Visitors (UMV)
means the average number of users and customers visiting our
platform (websites and mobile application) per month in a
particular period, excluding bots. Average UMV for a particular
period is calculated by aggregating the UMV for each month within
such period and dividing by the number of months. For 2020, 2019
and their respective interim periods, Average UMV is calculated
based on Google Analytical data; for the third quarter of 2021,
Average UMV is calculated as a sum of Average UMV for the Cian
Group (excluding the N1 Group) based on Google Analytics data and
Average UMV for the N1 Group based on Yandex.Metrica data
2 Listings means the daily average number
of real estate listings posted on our platform by agents and
individual sellers for a particular period
3 Leads to developers means the number of
paid target calls, lasting 30 seconds or longer, made through our
platform by home searchers to real estate developers, for a
particular period
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211124005931/en/
Investor: Varvara Kiseleva Head of Capital Markets and IR
ir@cian.ru
Media : Russian media: Olga Podoliaka po@cian.ru
International media: Hudson Sandler cian@hudsonsandler.com
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