UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
August 24, 2022
YANDEX N.V.
Schiphol Boulevard 165
1118 BG, Schiphol, the Netherlands.
Tel: +31 202 066 970
(Address, Including ZIP Code, and Telephone Number,
Including Area Code, of Registrant’s Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ⌧ Form 40-F ◻
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ◻
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ◻
EXPLANATORY NOTE
Filed as Exhibit 99.1 to this Report on Form 6-K is a copy of the unaudited condensed consolidated financial statements of Yandex N.V. as of and for the three and six months ended June 30, 2022.
INCORPORATION BY REFERENCE
Exhibit 99.1 to this Report on Form 6-K shall be deemed to be incorporated by reference into the registration statements on Form S-8 (Nos. 333-177622 and 333-213317) and Form F-3ASR (No. 333-239391) of Yandex N.V. (including any prospectuses forming a part of such registration statements) and to be a part thereof from the date on which this report is filed, to the extent not superseded by documents or reports subsequently filed or furnished.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| YANDEX N.V. | |
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Date: August 24, 2022 | By: | /s/ Svetlana Demyashkevich |
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| Svetlana Demyashkevich |
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| Chief Financial Officer |
INDEX TO EXHIBITS
Exhibit No. | Description |
99.1 | |
EXHIBIT 99.1
YANDEX N.V.
INDEX TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
F-1
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions of Russian rubles (“RUB”) and U.S. dollars (“$”), except share and per share data)
d
| | | | As of | ||||
| | Notes |
| December 31, |
| June 30, |
| June 30, |
| | | | RUB | | RUB | | $ |
ASSETS | | | | | | | | |
Cash and cash equivalents | | 3 | | 79,275 | | 75,592 | | 1,477.6 |
Term deposits | | | | 23,415 | | — | | — |
Investments in marketable equity securities | | 3 | | 4,049 | | — | | — |
Accounts receivable, less allowance for doubtful accounts of RUB 2,716 and RUB 3,319, respectively | | 3 | | 43,568 | | 37,685 | | 736.6 |
Inventory | | | | 9,587 | | 15,823 | | 309.3 |
Prepaid expenses | | | | 12,663 | | 12,670 | | 247.7 |
VAT reclaimable | | | | 13,498 | | 12,701 | | 248.3 |
Funds receivable, net | | | | 6,180 | | 4,118 | | 80.5 |
Other current assets | | 3 | | 7,740 | | 7,745 | | 151.4 |
Total current assets | | | | 199,975 | | 166,334 | | 3,251.4 |
Goodwill | | 7 | | 117,864 | | 118,521 | | 2,316.8 |
Property and equipment, net | | 5 | | 98,325 | | 107,291 | | 2,097.2 |
Operating lease right-of-use assets | | 6 | | 36,245 | | 31,544 | | 616.6 |
Intangible assets, net | | 7 | | 22,359 | | 18,929 | | 370.0 |
Content assets, net | | 9 | | 13,767 | | 15,339 | | 299.8 |
Equity method investments | | 3 | | 9,425 | | 6,489 | | 126.8 |
Deferred tax assets | | | | 5,625 | | 5,627 | | 110.0 |
Long-term prepaid expenses | | | | 3,278 | | 3,589 | | 70.2 |
Other non-current assets | | 3 | | 8,633 | | 8,758 | | 171.2 |
Total non-current assets | | | | 315,521 | | 316,087 | | 6,178.6 |
TOTAL ASSETS | | | | 515,496 | | 482,421 | | 9,430.0 |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | |
Accounts payable, accrued and other liabilities | | 3 | | 81,555 | | 77,478 | | 1,514.4 |
Debt, current portion | | 11 | | 2,940 | | 23,358 | | 456.6 |
Income and non-income taxes payable | | 3 | | 16,196 | | 20,555 | | 401.8 |
Deferred revenue | | | | 10,415 | | 10,783 | | 210.8 |
Total current liabilities | | | | 111,106 | | 132,174 | | 2,583.6 |
Debt, non-current portion | | 11 | | 85,835 | | 26,438 | | 516.8 |
Operating lease liabilities | | 6 | | 24,642 | | 20,672 | | 404.1 |
Finance lease liabilities | | 6 | | 15,350 | | 15,612 | | 305.2 |
Deferred tax liabilities | | | | 2,989 | | 2,855 | | 55.8 |
Other accrued liabilities | | | | 2,649 | | 2,976 | | 58.1 |
Total non-current liabilities | | | | 131,465 | | 68,553 | | 1,340.0 |
Total liabilities | | | | 242,571 | | 200,727 | | 3,923.6 |
Commitments and contingencies | | 9,10 | | | | | | |
Redeemable noncontrolling interests | | | | 869 | | 338 | | 6.6 |
Shareholders’ equity: | | | | | | | | |
Priority share: €1 par value; 1 share authorized, issued and outstanding | | | | — | | — | | — |
Ordinary shares: par value (Class A €0.01, Class B €0.10 and Class C €0.09); shares authorized (Class A: 500,000,000, Class B: 37,138,658, and Class C: 37,748,658); shares issued (Class A: 323,800,479, Class B: 35,698,674, and Class C: 10,000); shares outstanding (Class A: 323,004,678, and 323,241,816, respectively, Class B: 35,698,674 and Class C: nil) | | | | 281 | | 281 | | 5.5 |
Treasury shares at cost (Class A: 795,801 and 558,663, respectively) | | | | (2,728) | | (1,393) | | (27.2) |
Additional paid-in capital | | | | 112,942 | | 116,634 | | 2,279.9 |
Accumulated other comprehensive income | | | | 16,193 | | 23,304 | | 455.6 |
Retained earnings | | | | 131,488 | | 125,293 | | 2,449.1 |
Total equity attributable to Yandex N.V. | | | | 258,176 | | 264,119 | | 5,162.9 |
Noncontrolling interests | | | | 13,880 | | 17,237 | | 336.9 |
Total shareholders’ equity | | | | 272,056 | | 281,356 | | 5,499.8 |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | | |
| 515,496 | | 482,421 | | 9,430.0 |
| | | | | | | | |
* Derived from audited consolidated financial statements and adjusted for certain reclassifications (Note 3) | | | | | | | | |
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
F-2
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions of Russian rubles and U.S. dollars, except share and per share data)
| | | | Three months ended June 30, | | Six months ended June 30, | ||||||||
| | Notes | | 2021 | | 2022 | | 2022 | | 2021 | | 2022 | | 2022 |
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| |
| RUB |
| RUB | | $ | | RUB |
| RUB |
| $ |
Revenues | | 3 | | 81,402 | | 117,748 | | 2,301.7 | | 154,538 | | 223,758 | | 4,373.9 |
Operating costs and expenses: | | | | | | | | | | | | | | |
Cost of revenues(1) | | | | 41,774 | | 48,721 | | 952.4 | | 75,816 |
| 99,732 | | 1,949.5 |
Product development(1) | | | | 11,234 | | 16,826 | | 328.9 | | 22,243 |
| 35,987 | | 703.4 |
Sales, general and administrative(1) | | | | 27,476 | | 35,742 | | 698.6 | | 50,571 |
| 76,547 | | 1,496.4 |
Depreciation and amortization | | | | 5,641 | | 7,713 | | 150.8 | | 10,898 |
| 15,180 | | 296.7 |
Total operating costs and expenses | | | | 86,125 | | 109,002 | | 2,130.7 | | 159,528 |
| 227,446 | | 4,446.0 |
Income/(loss) from operations | | | | (4,723) | | 8,746 | | 171.0 | | (4,990) |
| (3,688) | | (72.1) |
Interest income | | 3 | | 1,180 | | 1,037 | | 20.3 | | 2,357 |
| 2,399 | | 46.9 |
Interest expense | | | | (861) | | (1,109) | | (21.7) | | (1,654) |
| (1,729) | | (33.8) |
Gain on restructuring of convertible debt | | 11 | | — | | 9,305 | | 181.9 | | — |
| 9,305 | | 181.9 |
Loss from equity method investments | | | | (5) | | (86) | | (1.7) | | (6) | | (451) | | (8.8) |
Other income/(loss), net | | 3 | | 230 | | (6,105) | | (119.4) | | 689 |
| (4,567) | | (89.3) |
Net income/(loss) before income taxes | | | | (4,179) | | 11,788 | | 230.4 | | (3,604) |
| 1,269 | | 24.8 |
Income tax expense |
| 8 | | 485 | | 3,732 | | 72.9 | | 4,280 |
| 6,250 | | 122.2 |
Net income/(loss) | | | | (4,664) | | 8,056 | | 157.5 | | (7,884) |
| (4,981) | | (97.4) |
Net (income)/loss attributable to noncontrolling interests | | | | 785 | | (2,290) | | (44.8) | | 1,028 |
| (3,676) | | (71.8) |
Net income/(loss) attributable to Yandex N.V. | | | | (3,879) | | 5,766 | | 112.7 | | (6,856) |
| (8,657) | | (169.2) |
Net income/(loss) per Class A and Class B share: | | | | | | | | | | | | | | |
Basic |
| 2 | | (10.88) | | 15.54 | | 0.30 | | (19.26) |
| (23.53) | | (0.46) |
Diluted |
| 2 | | (10.88) | | (7.03) | | (0.14) | | (19.26) |
| (45.86) | | (0.90) |
Weighted average number of Class A | | | | | | | | | | | | | | |
Basic |
| 2 | | 356,616,989 | | 371,106,744 | | 371,106,744 | | 356,017,710 |
| 367,856,773 | | 367,856,773 |
Diluted |
| 2 | | 356,616,989 | | 376,105,159 | | 376,105,159 | | 356,017,710 |
| 370,832,165 | | 370,832,165 |
(1) | These balances exclude depreciation and amortization expenses, which are presented separately, and include share-based compensation expenses of: |
Cost of revenues |
| | | 126 |
| 129 | | 2.5 | | 250 |
| 280 | | 5.5 |
Product development |
| | | 2,592 |
| 3,926 | | 76.7 | | 6,034 |
| 7,466 | | 145.9 |
Sales, general and administrative |
| | | 2,144 |
| 2,440 | | 47.8 | | 4,382 |
| 5,014 | | 98.0 |
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
F-3
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS)
(In millions of Russian rubles and U.S. dollars)
| | Three months ended June 30, | | Six months ended June 30, | ||||||||
|
| 2021 | | 2022 | | 2022 | | 2021 | | 2022 | | 2022 |
| | RUB | | RUB | | $ | | RUB | | RUB | | $ |
Net income/(loss) | | (4,664) | | 8,056 | | 157.5 | | (7,884) | | (4,981) | | (97.4) |
Foreign currency translation, net of tax of nil | | (2,031) | | 12,662 | | 247.5 | | (1,372) | | 6,853 | | 134.0 |
Total comprehensive income/(loss) | | (6,695) | | 20,718 | | 405.0 | | (9,256) | | 1,872 | | 36.6 |
Total comprehensive (income)/loss attributable to noncontrolling interests | | 769 | | (2,061) | | (40.3) | | 811 | | (3,418) | | (66.8) |
Total comprehensive income/(loss) attributable to Yandex N.V. | | (5,926) | | 18,657 | | 364.7 | | (8,445) | | (1,546) | | (30.2) |
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
F-4
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions of Russian rubles and U.S. dollars)
| | | | Six months ended June 30, | ||||
|
| Notes | | 2021 | | 2022 | | 2022 |
| | | | RUB | | RUB | | $ |
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES: | | | | | | | | |
Net loss | | | | (7,884) | | (4,981) | | (97.4) |
Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | | | | |
Depreciation of property and equipment | | 5 | | 8,015 | | 11,649 | | 227.7 |
Amortization of intangible assets | | 7 | | 2,883 | | 3,531 | | 69.0 |
Amortization of content assets | | 9 | | 3,072 | | 4,626 | | 90.4 |
Operating lease right-of-use assets amortization and the lease liability accretion | | | | 5,030 | | 7,711 | | 150.7 |
Amortization of debt discount and issuance costs | | 11 | | 1,036 | | 585 | | 11.4 |
Share-based compensation expense (excluding cash settled awards of nil and | | 12 | | 10,666 | | 3,552 | | 69.4 |
RUB 9,208, respectively) | | | | | | | | |
Deferred income tax expense/(benefit) | | | | (4,065) | | 315 | | 6.2 |
Foreign exchange losses | | 3 | | 291 | | 4,231 | | 82.7 |
Loss from equity method investments | | | | 6 | | 451 | | 8.8 |
Gain on restructuring of convertible debt | | 11 | | — | | (9,305) | | (181.9) |
Impairment of long-lived assets | | | | — | | 3,644 | | 71.2 |
Provision for expected credit losses | | | | 506 | | 1,038 | | 20.3 |
Other | | | | 180 | | 481 | | 9.5 |
Changes in operating assets and liabilities excluding the effect of acquisitions: | | | | | | | | |
Accounts receivable, net | | | | (2,982) | | 4,540 | | 88.7 |
Prepaid expenses | | | | (5,196) | | (2,395) | | (46.7) |
Inventory | | | | (1,988) | | (6,065) | | (118.6) |
Accounts payable, accrued and other liabilities and non-income taxes payable | | | | 5,907 | | (1,108) | | (21.6) |
Deferred revenue | | | | 287 | | 694 | | 13.6 |
Other assets | | | | (8,110) | | 185 | | 3.6 |
Content assets | | | | (7,547) | | (6,199) | | (121.2) |
Content liabilities | | | | 3,581 | | (353) | | (6.9) |
Net cash provided by operating activities | | | | 3,688 | | 16,827 | | 328.9 |
CASH FLOWS PROVIDED BY/(USED IN) INVESTING ACTIVITIES: | | | | | | | | |
Purchases of property and equipment and intangible assets |
| | | (17,244) | | (25,687) | | (502.1) |
Acquisitions of businesses, net of cash acquired |
| | | (7,274) | | (820) | | (16.0) |
Investments in marketable equity securities | | | | (9,869) | | — | | — |
Proceeds from sale of marketable equity securities | | | | 2,735 | | 5,859 | | 114.5 |
Investments in term deposits | | | | (187,251) | | (2,000) | | (39.1) |
Maturities of term deposits | | | | 170,608 | | 25,769 | | 503.6 |
Loans granted | | | | (560) | | (25) | | (0.5) |
Proceeds from repayments of loans | | | | 577 | | 480 | | 9.4 |
Other investing activities | | | | (231) | | (106) | | (2.0) |
Net cash provided by/(used in) investing activities | | | | (48,509) | | 3,470 | | 67.8 |
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
F-5
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(In millions of Russian rubles and U.S. dollars)
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements.
F-6
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(In millions of Russian rubles and U.S. dollars, except share and per share data)
| | Three months ended June 30, 2021 | ||||||||||||||||||||
| | Priority Share | | Ordinary Shares | | | | | | Accumulated | | | | | | | | Redeemable | ||||
| | Issued and | | Issued and | | Treasury | | Additional | | Other | | | | Non- | | |
| non- | ||||
| | Outstanding | | Outstanding | | shares at | | Paid-In | | Comprehensive | | Retained | | controlling | | |
| controlling | ||||
| | Shares | | Amount | | Shares | | Amount | | cost | | Capital | | Income | | Earnings | | interests | | Total |
| interests |
|
| |
| RUB |
| |
| RUB | | RUB | | RUB | | RUB | | RUB | | RUB |
| RUB |
| RUB |
Balance as of March 31, 2021 |
| 1 |
| — |
| 355,995,773 |
| 279 | | (5) | | 167,836 | | 18,381 | | 143,229 | | 20,004 |
| 349,724 | | 1,859 |
Share-based compensation expense |
| — | | — | | — | | — | | — | | 4,862 | | — | | — | | — | | 4,862 | | — |
Exercise of share options |
| — | | — | | 1,384,570 | | — | | — | | 228 | | — | | — | | — | | 228 | | — |
Tax withholding related to exercise of share awards | | — | | — | | — | | — | | — | | (61) | | — | | — | | — | | (61) | | — |
Repurchase of share options |
| — | | — | | — | | — | | — | | 109 | | — | | 9 | | — | | 118 | | (105) |
Foreign currency translation adjustment | | — | | — | | — | | — | | — | | — | | (2,047) | | — | | 16 | | (2,031) | | — |
Change in redemption value of redeemable noncontrolling interests | | — | | — | | — | | — | | — | | — | | — | | (29) | | — | | (29) | | 29 |
Net loss | | — | | — | | — | | — | | — | | — | | — | | (3,879) | | (785) | | (4,664) | | — |
Other | | — | | — | | — | | 1 | | — | | 106 | | (2) | | — | | — | | 105 | | — |
Balance as of June 30, 2021 | | 1 | | — | | 357,380,343 | | 280 | | (5) | | 173,080 | | 16,332 | | 139,330 | | 19,235 | | 348,252 | | 1,783 |
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | |
| | Three months ended June 30, 2022 | ||||||||||||||||||||
| | Priority Share | | Ordinary Shares | | | | | | Accumulated | | | | | | | | Redeemable | ||||
| | Issued and | | Issued and | | Treasury | | Additional | | Other | | | | Non- | | |
| non- | ||||
| | Outstanding | | Outstanding | | shares at | | Paid-In | | Comprehensive | | Retained | | controlling | | |
| controlling | ||||
| | Shares | | Amount | | Shares | | Amount | | cost | | Capital | | Income | | Earnings | | interests | | Total |
| interests |
|
| |
| RUB |
| |
| RUB | | RUB | | RUB | | RUB | | RUB | | RUB |
| RUB |
| RUB |
Balance as of March 31, 2022 |
| 1 |
| — |
| 358,940,490 |
| 281 | | (1,393) | | 105,600 | | 10,413 | | 119,486 | | 15,317 |
| 249,704 | | 435 |
Share-based compensation expense | | — | | — | | — | | — | | — | | 1,010 | | — | | — | | — | | 1,010 | | — |
Convertible debt restructuring (Note 11) |
| — | | — | | — | | — | | — | | 9,941 | | — | | — | | — | | 9,941 | | — |
Repurchase of share options | | — | | — | | — | | — | | — | | (58) | | — | | (12) | | — | | (70) | | (44) |
Foreign currency translation adjustment | | — | | — | | — | | — | | — | | — | | 12,891 | | — | | (229) | | 12,662 | | — |
Change in redemption value of redeemable noncontrolling interests | | — | | — | | — | | — | | — | | — | | — | | 53 | | — | | 53 | | (53) |
Net income | | — | | — | | — | | — | | — | | — | | — | | 5,766 | | 2,290 | | 8,056 | | — |
Other | | — | | — | | — | | — | | — | | 141 | | — | | — | | (141) | | — | | — |
Balance as of June 30, 2022 | | 1 | | — | | 358,940,490 | | 281 | | (1,393) | | 116,634 | | 23,304 | | 125,293 | | 17,237 | | 281,356 | | 338 |
Balance as of June 30, 2022, $ |
| | | — | | | | 5.5 | | (27.2) | | 2,279.9 | | 455.6 | | 2,449.1 | | 336.9 | | 5,499.8 | | 6.6 |
The accompanying notes are an integral part of the unaudited condensed consolidated financial statements
F-7
YANDEX N.V.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (CONTINUED)
(In millions of Russian rubles and U.S. dollars, except share and per share data)
| | Six months ended June 30, 2021 | ||||||||||||||||||||
| | Priority Share | | Ordinary Shares | | | | | | Accumulated | | | | | | | | Redeemable | ||||
| | Issued and | | Issued and | | Treasury | | Additional | | Other | | | | Non- | | |
| non- | ||||
| | Outstanding | | Outstanding | | shares at | | Paid-In | | Comprehensive | | Retained | | controlling | | |
| controlling | ||||
| | Shares | | Amount | | Shares | | Amount | | cost | | Capital | | Income | | Earnings | | interests | | Total |
| interests |
|
| |
| RUB |
| |
| RUB |
| RUB |
| RUB |
| RUB |
| RUB | | RUB |
| RUB |
| RUB |
Balance as of December 31, 2020 |
| 1 | | — | | 354,210,532 | | 278 | | (6) | | 160,857 | | 17,923 | | 145,789 | | 20,094 | | 344,935 | | 3,167 |
Share-based compensation expense |
| — | | — | | — | | — | | — | | 10,828 | | — | | — | | — | | 10,828 | | — |
Exercise of share options |
| — | | — | | 3,169,811 | | — | | — | | 856 | | — | | — | | — | | 856 | | — |
Tax withholding related to exercise of share awards | | — | | — | | — | | — | | — | | (121) | | — | | — | | — | | (121) | | — |
Repurchase of share options | | — | | — | | — | | — | | — | | 411 | | — | | 14 | | — | | 425 | | (976) |
Foreign currency translation adjustment | | — | | — | | — | | — | | — | | — | | (1,589) | | — | | 217 | | (1,372) | | — |
Change in redemption value of redeemable noncontrolling interests |
| — | | — | | — | | — | | — | | — | | — | | 408 | | — | | 408 | | (408) |
Net loss | | — | | — | | — | | — | | — | | — | | — | | (6,856) | | (1,028) | | (7,884) | | — |
Other | | — | | — | | — | | 2 | | 1 | | 249 | | (2) | | (25) | | (48) | | 177 | | — |
Balance as of June 30, 2021 |
| 1 | | — | | 357,380,343 | | 280 | | (5) | | 173,080 | | 16,332 | | 139,330 | | 19,235 | | 348,252 | | 1,783 |
| | Six months ended June 30, 2022 | ||||||||||||||||||||
| | Priority Share | | Ordinary Shares | | | | | | Accumulated | | | | | | | | Redeemable | ||||
| | Issued and | | Issued and | | Treasury | | Additional | | Other | | | | Non- | | |
| non- | ||||
| | Outstanding | | Outstanding | | shares at | | Paid-In | | Comprehensive | | Retained | | controlling | | |
| controlling | ||||
| | Shares | | Amount | | Shares | | Amount | | cost | | Capital | | Income | | Earnings | | interests | | Total |
| interests |
|
| |
| RUB |
| | | RUB | | RUB | | RUB | | RUB | | RUB | | RUB |
| RUB |
| RUB |
Balance as of December 31, 2021 | | 1 | | — | | 358,703,352 | | 281 | | (2,728) | | 112,942 | | 16,193 | | 131,488 | | 13,880 |
| 272,056 | | 869 |
Effect of adoption of ASU 2020-06 (Note 1) | | — | | — | | — | | — | | — | | (8,573) | | — | | 2,511 | | — | | (6,062) | | — |
Adjusted balance as of January 1, 2022 | | 1 | | — | | 358,703,352 | | 281 | | (2,728) | | 104,369 | | 16,193 | | 133,999 | | 13,880 | | 265,994 | | 869 |
Share-based compensation expense | | — | | — | | — | | — | | — | | 3,627 | | — | | — | | — | | 3,627 | | — |
Exercise of share options |
| — | | — | | 237,138 | | — | | — | | — | | — | | — | | — | | — | | — |
Tax withholding related to exercise of share awards | | — | | — | | — | | — | | — | | (25) | | — | | — | | — | | (25) | | — |
Reissue of shares for options exercised | | — | | — | | — | | — | | 1,335 | | (1,335) | | — | | — | | — | | — | | — |
Convertible debt restructuring (Note 11) | | — | | — | | — | | — | | — | | 9,941 | | — | | — | | — | | 9,941 | | — |
Repurchase of share options | | — | | — | | — | | — | | — | | (5) | | — | | (105) | | — | | (110) | | (474) |
Change in redemption value of redeemable noncontrolling interests | | — | | — | | — | | — | | — | | — | | — | | 57 | | — | | 57 | | (57) |
Foreign currency translation adjustment | | — | | — | | — | | — | | — | | — | | 7,111 | | — | | (258) | | 6,853 | | — |
Net (loss)/income | | — | | — | | — | | — | | — | | — | | — | | (8,657) | | 3,676 | | (4,981) | | — |
Other | | — | | — | | — | | — | | — | | 62 | | — | | (1) | | (61) | | — | | — |
Balance as of June 30, 2022 | | 1 | | — | | 358,940,490 | | 281 | | (1,393) | | 116,634 | | 23,304 | | 125,293 | | 17,237 | | 281,356 | | 338 |
Balance as of June 30, 2022, $ |
| | | — | | | | 5.5 | | (27.2) | | 2,279.9 | | 455.6 | | 2,449.1 | | 336.9 | | 5,499.8 | | 6.6 |
F-8
YANDEX N.V.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In millions of Russian rubles and U.S. dollars, except share and per share data)
1. | DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
Yandex N.V., the parent company, together with its consolidated subsidiaries (collectively “Yandex” or the “Company”), is a technology company that builds intelligent products and services powered by machine learning and other technologies. Yandex is one of Europe's largest internet companies and the leading search and ride-hailing provider in Russia.
Yandex N.V. was incorporated under the laws of the Netherlands in June 2004 and is the holding company of a number of subsidiaries globally.
Basis of Presentation and Going Concern
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. Accordingly, they do not include all of the information and notes required by U.S. GAAP for annual financial statements. As such, the information included in these unaudited condensed consolidated financial statements for the three and six months ended June 30, 2022 should be read in conjunction with the consolidated financial statements and the notes thereto included in the Annual Report on Form 20-F for the year ended December 31, 2021.
In the opinion of the Company, the accompanying unaudited condensed financial statements contain all adjustments, which are of a normal recurring nature, necessary for a fair statement of its financial position as of June 30, 2022, and its results of operations, comprehensive income/(loss), cash flows and change in equity for the periods presented. The condensed consolidated balance sheet as of December 31, 2021, was derived from audited annual consolidated financial statements included in the Annual Report on Form 20-F for the year ended December 31, 2021 but does not contain all of the related footnote disclosures.
There have been no material changes in the Company’s significant accounting policies and estimates as compared to those described in the Company’s Annual Report on Form 20-F for the year ended December 31, 2021. Accounting policy in relation to the restructuring of convertible debt is described in Note 11.
The results for the three and six months ended June 30, 2022 are not necessarily indicative of the operating results expected for the year ending December 31, 2022 or any other future period. The potential risks and uncertainties that could cause actual results to differ from the operating results expected include, among others, geopolitical and macroeconomic developments affecting the Russian economy or the Company’s business, operations or governance; changes in the political, legal and/or regulatory environment; the impact of the ongoing COVID-19 pandemic and regulatory and business responses to that crisis; competitive pressures; changes in advertising patterns; changes in user preferences; technological developments; and the Company’s need to expend capital to accommodate the growth of the business.
The accompanying unaudited condensed consolidated financial statements were prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. As described in Note 11, following the suspension of trading of the Company’s Class A shares on the Nasdaq Global Select Market for more than five trading days, the holders of the Company’s convertible notes due March 3, 2025 (the “Notes”) had the right to require the Company to redeem the Notes at par, and the Company did not have the funds available to redeem the Notes in full. These conditions raised substantial doubt about the Company’s ability to continue as a going concern which was disclosed in the Company’s unaudited condensed consolidated financial statements for the three months ended March 31, 2022. In June 2022 the Company restructured the terms of the Notes and entered into a purchase agreement with holders of 93.2% in aggregate principal amount of the Notes. The purchase was funded by external debt financing obtained, which repayable ratably over the next three years. The Company’s cash flow forecast taking into account this restructuring and the terms of the new debt financing indicate that the Company will have sufficient liquidity in the course of at least next twelve months. As a result of these events the substantial doubt about the Company’s ability to continue as a going concern no longer exists.
F-9
YANDEX N.V.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In millions of Russian rubles and U.S. dollars, except share and per share data)
Use of Estimates
The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and amounts of revenues and expenses for the reporting period. The Company bases its estimates on historical experience and on various other assumptions, the results of which form the basis for making judgments about the carrying values of assets and liabilities, that are believed to be reasonable. These estimates are inherently subject to judgment and actual results could differ from those estimates.
Convenience Translation
Translations of amounts from RUB into U.S. dollars for the convenience of the reader have been made at the exchange rate of RUB 51.1580 to $1.00, the exchange rate as of June 30, 2022 (except as otherwise stated). No representation is made that the RUB amounts could have been, or could be, converted into U.S. dollars at such rate. After the balance sheet date, the ruble has been experiencing a period of significant volatility.
Reclassification
Certain reclassifications have been made to the consolidated balance sheet as of December 31, 2021 due to the separation of certain line items. The following table presents the impact of the reclassification on affected consolidated balance sheet line items as of December 31, 2021:
| | As of December 31, 2021 | ||||
| | As previously reported | | Reclassification | | After |
Selected Balance Sheets Data: |
| RUB | | RUB | | RUB |
Accounts payable, accrued and other liabilities | | 84,495 |