Cian PLC Announces First Quarter 2024 Financial Results
Larnaca, Cyprus, May 24, 2024 - Cian PLC (MOEX: CIAN) ("Cian", the "Group" or the "Company"), a leading online real estate classifieds platform in Russia, today announced its financial results for the first quarter ended March 31, 2024.
First Quarter 2024 Key Financial and Operational Highlights1
- Revenue increased by 31% Y-o-Y to RUB 3,151 million ($34.1 million).
- Profit for the period amounted to RUB 743 million ($8 million).
- Adjusted EBITDA2 increased by 172% Y-o-Y and reached RUB 960 million ($10.4 million).
- Adjusted EBITDA Margin2 increased by 15.8 pp Y-o-Y and amounted to 30.5%.
- Core Business revenue increased by 28% Y-o-Y to RUB 2,969 million ($32.1 million).
Dmitriy Grigoriev, Chief Executive Officer of Cian PLC, commented:
In the first quarter of 2024 we demonstrated solid growth despite the decreasing demand in the real estate market and high mortgage rates. Those factors are likely to keep putting pressure on the market and our business during this year. However, we feel ready to stand up to the challenges and remain committed to our longer-term growth targets promised back during the IPO."
Corporate restructuring
The founders and other shareholders of Cian PLC, excluding ADS holders (jointly referred to as the "Non-free-float Shareholders") have recently completed a technical reorganization which resulted in a new holding company Cian Technology Ltd, currently domiciled in Seychelles and owned by the Non-free-float Shareholders ("Cian Technology"), establishing control over the Company.
The reorganization was structured as a share-for-share exchange offer whereby the Non-free- float Shareholders exchanged their shares in the Company for shares in Cian Technology. As noted above, the Group believes the exercise is purely technical in nature and does not affect the beneficial ownership in the Company. Following this exchange, Cian Technology owns
- 70% in Cian PLC. According to the plan, Cian Technology will be redomiciled into the Russian Federation.
It is planned to make a public exchange offer to shareholders. The restructuring will not affect our business operations.
1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
2 Adjusted EBITDA and 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
More information on the above can be found in our press releasepublished on April 22, 2024.
First Quarter 2024 Results
Revenue
Revenue for the three months ended March 31, 2024 amounted to RUB 3,151 million compared to RUB 2,402 million for the three months ended March 31, 2023, demonstrating an increase of RUB 749 million, or 31%. The revenue growth was mainly driven by growth of the Core Business segment.
The following table sets forth a breakdown of our revenue by segment and type for the periods indicated (in millions of RUB and USD):
Three months ended | ||||
March 31, | March 31, | March 31, | Y-o-Y | |
2023 | 2024 | 2024 | growth | |
RUB | RUB | USD (1) | ||
Total Revenue | 2,402 | 3,151 | 34.1 | 31% |
Core Business | 2,314 | 2,969 | 32.1 | 28% |
Transactional Business | 88 | 182 | 2.0 | 107% |
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1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
Core Business segment revenue
Core Business revenue reached RUB 2,969 million for the three months ended March 31, 2024, increasing by 28% compared to RUB 2,314 million for the three months ended March 31, 2023. Core Business revenue growth was driven by good performance across all key revenue streams - listing revenue, lead generation and display advertising revenue.
Transactional Business segment revenue
Transactional Business revenue amounted to RUB 182 million for the three months ended March 31, 2024 compared to RUB 88 million for the prior year, representing an increase of RUB 94 million, or 107%. The increase was a result of other revenue growth due to the acquisition of SmartDeal.
Operating expenses
Total operating expenses increased by 5% to RUB 2,376 million in the three months ended March 31, 2024 from RUB 2,270 million in the three months ended March 31, 2023, primarily driven by an increase in employee-related expenses.
The following table sets forth a breakdown of our operating expenses for the periods indicated (in millions of RUB and USD):
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Three months (unaudited) | ||||
March 31, | March 31, | March 31, | Y-o-Y | |
2023 | 2024 | 2024 | growth | |
RUB | RUB | USD (1) | ||
Operating expenses | 2,270 | 2,376 | 25.7 | 5% |
Marketing expenses | 844 | 824 | 8.9 | -2% |
Employee-related expenses | 1,058 | 1,185 | 12.8 | 12% |
IT expenses | 165 | 138 | 1.5 | -16% |
Depreciation and amortization | 60 | 85 | 0.9 | 42% |
Other operating expenses | 143 | 144 | 1.6 | 1% |
1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
Profit for the period
Profit for the three months ended March 31, 2024 was RUB 743 million compared to RUB 211 million for the three months ended March 31, 2023. The change in profit for the period was driven primarily by the revenue growth outpacing the growth of operating expenses.
Adjusted EBITDA and Adjusted EBITDA Margin
Adjusted EBITDA for the three months ended March 31, 2024 reached RUB 960 million, compared to RUB 353 million for the three months ended March 31, 2023. The increase in Adjusted EBITDA was primarily driven by the revenue growth.
Adjusted EBITDA Margin increased by 15.8 pp to 30.5% for the three months ended March 31, 2024.
Factors affecting year-over-year trends and comparisons
We believe that trends in the real estate market in the three months of 2024 were particularly characterized by the following events: (i) lower demand in the three months of 2024 compared to the respective period of the last year; (ii) in December 2023, the terms of the government- subsidized mortgage program were tightened. The maximum loan amount was restricted to RUB 6 mln in all regions and the down payment size was increased from 20% to 30%; (iii) the Bank of Russia did not change the key interest rate in the first quarter of 2024 and kept it at 16.0%. The high key interest rate continued to put pressure on the mortgage market.
First Quarter 2024 Financial Results Conference Call
Considering the existing uncertainty and market volatility, the Company will not be conducting its first quarter 2024 conference call. Investors, analysts, and media are welcome to send their inquiries to the Company using the contact details provided in this release.
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 15 most popular online real estate classifieds globally in terms of traffic (based on SimilarWeb traffic data for April 2024). 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 2023, the Company had
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1.9 million listings available through its platform and a monthly audience with an average UMV of 19.2 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. 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 2024 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: the negative impact on the Russian economy of the ongoing military actions between Russia and Ukraine, any negative effects of sanctions, export controls and similar measures targeting Russia as well as other responses to the military conflict in Ukraine; our ability to maintain our leading market positions, particularly in Moscow, St. Petersburg and certain other regions, and our ability to achieve and maintain a 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 other important factors discussed in item 2.8 of Cian's Prospectus registered by the Central Bank of Russia on December 11, 2023.
Any forward-looking statements contained in this press release speak only as of the date hereof, and accordingly no undue reliance should be placed on such statements. We disclaim any obligation or undertaking to update or revise any forward-looking statements containedin this press release, whether as a result of new information, future events or otherwise, other than to the extent required by applicable law.
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Investor contacts:
Daria Fadeeva
ir@cian.ru
Media contacts:
Olga Podoliaka
pr@cian.ru
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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 | ||||||
March 31, | March 31, | March 31, | ||||
2023 | 2024 | 2024 | ||||
RUB | RUB | USD(1) | ||||
(unaudited) | (unaudited) | (unaudited) | ||||
Revenue | 2,402 | 3,151 | 34.1 | |||
Operating expenses: | ||||||
Marketing expenses | (844) | (824) | (8.9) | |||
Employee-related expenses | (1,058) | (1,185) | (12.8) | |||
IT expenses | (165) | (138) | (1.5) | |||
Depreciation and amortization | (60) | (85) | (0.9) | |||
Other operating expenses | (143) | (144) | (1.6) | |||
Total operating expenses | (2,270) | (2,376) | (25.7) | |||
Operating profit | 132 | 775 | 8.4 | |||
Finance costs | (6) | (23) | (0.2) | |||
Finance income | 47 | 200 | 2.2 | |||
Foreign currency exchange gain / (loss), net | 121 | (5) | (0.1) | |||
Other non-operating income | 12 | - | - | |||
Profit before income tax | 306 | 947 | 10.3 | |||
Income tax expense | (95) | (204) | (2.2) | |||
Profit for the year | 211 | 743 | 8.0 | |||
Total comprehensive income for the year | 211 | 743 | 8.0 | |||
Profit per share, in RUB | ||||||
Basic profit per share attributable to ordinary equity holders of the parent | 3.02 | 10.62 | 0.11 | |||
Diluted profit per share attributable to ordinary equity holders of the parent | 2.90 | 10.20 | 0.11 | |||
1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
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Consolidated Statement of Financial Position (in millions of RUB and USD)
As of | ||||||
December 31, 2023 | March 31, 2024 | March 31, 2024 | ||||
RUB | RUB | USD(1) | ||||
(audited) | (unaudited) | (unaudited) | ||||
Assets | ||||||
Non-current assets | ||||||
Property and equipment | 73 | 71 | 0.8 | |||
Right-of-use assets | 33 | 23 | 0.2 | |||
Goodwill | 933 | 933 | 10.1 | |||
Intangible assets | 1,541 | 1,500 | 16.2 | |||
Deferred tax assets | 207 | 198 | 2.1 | |||
Other non-current assets | 7 | 7 | 0.1 | |||
Total non-current assets | 2,794 | 2,732 | 29.6 | |||
Current assets | ||||||
Inventories | 29 | 22 | 0.2 | |||
Advances paid and prepaid expenses | 141 | 130 | 1.4 | |||
Trade and other receivables | 573 | 696 | 7.5 | |||
Prepaid income tax | 66 | 83 | 0.9 | |||
Cash and cash equivalents | 6,434 | 7,392 | 80.0 | |||
Other current assets | 257 | 241 | 2.6 | |||
Total current assets | 7,500 | 8,564 | 92.7 | |||
Total assets | 10,294 | 11,296 | 122.3 | |||
Equity and liabilities | ||||||
Equity | ||||||
Share capital | 2 | 2 | 0.02 | |||
Share premium | 7,702 | 7,702 | 83.4 | |||
Equity-settled employee benefits reserves | 1,117 | 1,217 | 13.2 | |||
Accumulated losses | (1,645) | (902) | (9.8) | |||
Total equity | 7,176 | 8,019 | 86.8 | |||
Liabilities | ||||||
Non-current liabilities | ||||||
Lease liabilities | 10 | 7 | 0.1 | |||
Deferred tax liabilities | 113 | 108 | 1.2 | |||
Trade and other payables | 104 | 108 | 1.2 | |||
Total non-current liabilities | 227 | 223 | 2.4 | |||
Current liabilities | ||||||
Contract liabilities | 869 | 856 | 9.3 | |||
Trade and other payables | 1,540 | 1,629 | 17.6 | |||
Income tax payable | 1 | 3 | 0.03 | |||
Other taxes payable | 463 | 555 | 6.0 | |||
Lease liabilities | 18 | 11 | 0.1 | |||
Total current liabilities | 2,891 | 3,054 | 33.1 | |||
Total liabilities | 3,118 | 3,277 | 35.5 | |||
Total liabilities and equity | 10,294 | 11,296 | 122.3 | |||
1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
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Consolidated Statement of Cash Flows (in millions of RUB and USD)
Three months ended | |||||||
March 31, | March 31, | March 31, | |||||
2023 | 2024 | 2024 | |||||
RUB | RUB | USD(1) | |||||
(unaudited) | (unaudited) | (unaudited) | |||||
Cash flows from operating activities | |||||||
Profit before income tax | 306 | 947 | 10.3 | ||||
Adjusted for: | |||||||
Depreciation and amortization | 60 | 85 | 0.9 | ||||
Employee share-based payment expense | 161 | 100 | 1.1 | ||||
Finance income | (47) | (200) | (2.2) | ||||
Finance costs | 6 | 23 | 0.2 | ||||
Foreign currency exchange loss / (gain), net | (121) | 5 | 0.1 | ||||
Allowance for expected credit losses | - | 5 | 0.1 | ||||
Working capital changes: | |||||||
Increase in trade and other receivables | (78) | (128) | (1.4) | ||||
Decrease / (increase) in advances paid and prepaid | |||||||
expenses | (3) | 11 | 0.1 | ||||
Decrease / (increase) in other assets | (2) | 18 | 0.2 | ||||
Increase in trade and other payables | 279 | 62 | 0.7 | ||||
(Decrease) / increase in contract liabilities and deferred | |||||||
income | 8 | (12) | (0.1) | ||||
Increase in other liabilities | 15 | 96 | 1.0 | ||||
Cash generated from operating activities | 584 | 1,012 | 11.0 | ||||
Income tax paid | (131) | (215) | (2.3) | ||||
Interest received | 47 | 199 | 2.2 | ||||
Interest paid | (1) | (1) | (0.0) | ||||
Net cash generated from operating activities | 499 | 995 | 10.8 | ||||
Cash flows from investing activities | |||||||
Purchase of property and equipment | (7) | (6) | (0.1) | ||||
Purchase of intangible assets | (26) | (26) | (0.3) | ||||
Loans collected from employees | - | 2 | 0.0 | ||||
Net cash used in investing activities | (33) | (30) | (0.3) | ||||
Cash flows from financing activities | |||||||
Payment of principal portion of lease liabilities | (11) | (11) | (0.1) | ||||
Net cash used in financing activities | (11) | (11) | (0.1) | ||||
Net increase in cash and cash equivalents | 455 | 954 | 10.3 | ||||
Cash and cash equivalents at the beginning | |||||||
of the period | 4,110 | 6,434 | 69.7 | ||||
Effect of exchange rate changes on cash and cash | |||||||
equivalents | 128 | 4 | 0.0 | ||||
Cash and cash equivalents at the end of the period | 4,693 | 7,392 | 80.0 | ||||
1 U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
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Non-IFRS Financial Measures and Supplemental Financial Information Use of Non-IFRS Financial Measures
We use Adjusted EBITDA and Adjusted EBITDA Margin as non-IFRS financial measure inassessing our operating performance and in our financial communications.
Adjusted EBITDA and Adjusted EBITDA Margin are financial measures that are not calculatedin accordance with IFRS. These non-IFRSfinancial measures should not be considered in isolation or as an alternative or a substitute to profit 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 and Adjusted EBITDA Margin havelimitations 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 foreign currency exchange loss (gain), which reduces (increases) 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 tables below provide detailed reconciliations of each non-IFRS financial measure we usefrom the most directly comparable IFRS financial measure.
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Reconciliation of Adjusted EBITDA from Loss for the period, the most directlycomparable IFRS financial measure (in millions of RUB and USD)
Three months ended | |||||||
March 31, | March 31, | March 31, | |||||
2023 | 2024 | 2024 | |||||
RUB | RUB | USD(1) | |||||
(unaudited) | (unaudited) | (unaudited) | |||||
Profit for the period | 211 | 743 | 8.0 | ||||
Income tax expense | 95 | 204 | 2.2 | ||||
Profit before income tax | 306 | 947 | 10.3 | ||||
Depreciation and amortization | 60 | 85 | 0.9 | ||||
Finance income, net(2) | (41) | (177) | (1.9) | ||||
Foreign currency exchange (gain) / loss, net | (121) | 5 | 0.1 | ||||
Share-based payment expenses | 161 | 100 | 1.1 | ||||
Other non-operating income, net(3) | (12) | - | - | ||||
Adjusted EBITDA(4) | 353 | 960 | 10.4 | ||||
Adjusted EBITDA Margin(5) | 14.7% | 30.5% | 30.5% | ||||
- U.S. 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 March 31, 2024 (RUB 92.3660 to USD 1.00)
- Comprises finance costs and finance income for the respective periods.
- Comprises income from the depositary.
- Defined as profit for the period adjusted to exclude income tax expense, finance costs, finance income, foreign currency exchange loss / (gain), net, depreciation and amortization, share-based payments under equity-based incentive program and other non- operating income, net.
- Defined as Adjusted EBITDA divided by revenue for the respective periods.
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Cian plc published this content on 24 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 May 2024 14:05:06 UTC.