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

 

February 16, 2021

 

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):

 

 

 


Furnished as Exhibit 99.1 to this Report on Form 6-K is a press release of Yandex N.V. (the “Company”) dated February 16, 2021, announcing the Company’s results for the fourth quarter and full year ended December 31, 2020.


  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.

 

 

 

 

 

 

Date: February 16, 2021

By:

/s/ Greg Abovsky

 

 

Greg Abovsky

 

 

Chief Financial Officer and
Chief Operating Officer

 


INDEX TO EXHIBITS

Exhibit No.

Description

99.1

Press release of Yandex N.V. dated February 16, 2021, announcing results for the fourth quarter and full year ended December 31, 2020.


Exhibit 99.1

Yandex Announces Fourth Quarter and Full-Year 2020 Financial Results

MOSCOW and AMSTERDAM, the Netherlands, February 16, 2021 -- Yandex (NASDAQ and MOEX: YNDX), one of Europe's largest internet companies and the leading search and ride-hailing provider in Russia, today announced its unaudited financial results for the fourth quarter and the full year ended December 31, 2020.

Q4 2020 Financial Highlights 1, 2

Q4 2020 consolidated financial results

Revenues of RUB 71.6 billion ($969.2 million), up 39% compared with Q4 2019
Net income of RUB 0.4 billion ($5.4 million), up 43% compared with net income of RUB 0.3 billion in Q4 2019; net income margin of 0.6%
Adjusted net income of RUB 6.3 billion ($85.4 million), up 17% compared with Q4 2019; adjusted net income margin of 8.8%
Adjusted EBITDA of RUB 14.0 billion ($190.0 million), up 6% compared with Q4 2019; adjusted EBITDA margin of 19.6%

Q4 2020 financial results on a like-for-like basis excluding Yandex.Market in 2019 and 2020

Revenues of RUB 63.9 billion ($864.6 million), up 24% compared with Q4 2019
Net income of RUB 4.2 billion ($56.7 million), up 130% compared with net income of RUB 1.8 billion in Q4 2019; net income margin of 6.6%
Adjusted net income of RUB 9.8 billion ($132.2 million), up 41% compared with Q4 2019; adjusted net income margin of 15.3%
Adjusted EBITDA of RUB 17.1 billion ($231.1 million), up 29% compared with Q4 2019; adjusted EBITDA margin of 26.7%

FY 2020 Financial Highlights

FY 2020 consolidated financial results

Revenues of RUB 218.3 billion ($2,955.6 million), up 24% compared with FY 2019
Net income of RUB 24.1 billion ($326.9 million), up 116% compared with FY 2019; net income margin of 11.1%
Adjusted net income RUB 21.0 billion ($284.5 million), down 11% compared with FY 2019; adjusted net income margin of 9.6%
Adjusted EBITDA of RUB 49.8 billion ($673.6 million), down 2% compared with FY 2019; adjusted EBITDA margin of 22.8%

1 Pursuant to SEC rules regarding convenience translations, Russian ruble (RUB) amounts have been translated into U.S. dollars at a rate of RUB 73.8757 to $1.00, the official exchange rate quoted as of December 31, 2020 by the Central Bank of the Russian Federation.

2 Hereinafter, the following measures presented in this release are “non-GAAP financial measures”: ex-TAC revenues, adjusted EBITDA, adjusted EBITDA margin, adjusted ex-TAC EBITDA margin, adjusted net income, adjusted net income margin, adjusted ex-TAC net income margin, financial results on a like-for-like basis excluding Yandex.Market and online advertising revenues on a like-for-like basis including revenues of Yandex.Market. Please see the section headed “Use of Non-GAAP Financial Measures” below for a discussion of how we define these measures, as well as reconciliations at the end of this release of each of these measures to the most directly comparable U.S. GAAP measures


FY 2020 financial results on a like-for-like basis excluding Yandex.Market in 2019 and 2020

Revenues of RUB 206.0 billion ($2,788.3 million), up 17% compared with 2019
Net income of RUB 13.0 billion ($176.5 million), down 16% compared with net income of RUB 15.5 billion in 2019; net income margin of 6.3%
Adjusted net income of RUB 28.5 billion ($386.2 million), up 2% compared with 2019; adjusted net income margin of 13.9%
Adjusted EBITDA of RUB 53.9 billion ($729.3 million), up 6% compared with 2019; adjusted EBITDA margin of 26.2%

Cash, cash equivalents and term deposits as of December 31, 2020:

RUB 238.2 billion ($3,224.2 million) on a consolidated basis
Of which RUB 27.3 billion ($370.1 million) is related to Taxi segment

Q4 2020 Operational and Corporate Highlights

Search

Share of Russian search market, including mobile, averaged 59.7% in Q4 2020, up from 57.5% in Q4 2019 and 59.3% in Q3 2020, according to Yandex.Radar
Search share on Android in Russia was 58.6% in Q4 2020, up from 54.3% in Q4 2019 and broadly in line with 58.7% in Q3 2020, according to Yandex.Radar
Mobile search traffic was 60.5% of our total search traffic in Q4 2020. Mobile revenues represented 53.3% of our search revenues in Q4 2020
Search queries in Russia grew 20% compared with Q4 2019
Paid clicks on Yandex’s and its partners’ websites increased 14% (3% excluding Yandex.Market) compared with Q4 2019 as we continue to prioritise conversions for our advertising clients
Average cost per click decreased 2% (increased 1% excluding Yandex.Market) compared with Q4 2019

Business Units and Experiments

Number of rides in the Ride-hailing service, excluding logistics deliveries, increased 17% year-on-year compared with Q4 2019
Number of dark stores in Yandex.Lavka service reached 270 stores as of the end of December 2020
Total gross merchandise value (“GMV”) 3 of our e-commerce operations (Yandex.Market marketplace, our e-grocery business Yandex.Lavka and grocery-originated GMV of Yandex.Eats) increased by 127% year-on-year in Q4 2020.
The share of GMV sold by third-party sellers on our Yandex.Market marketplace reached 63.5% in Q4 2020
Marketplace’s assortment reached 2 million SKUs as of the end of Q4 2020
Number of Yandex.Plus subscribers reached 6.8 million as of the end of Q4 2020, up 152% from the end of Q4 2019
Zen's daily average users reached 20.3 million in December 2020, up 51% from December 2019

3 GMV is defined as the value of all merchandise sold through our Yandex.Market marketplace and Yandex.Lavka as well as the value of grocery products sold through Yandex.Eats (delivered and paid for) to customers including VAT


Subsequent Corporate Events

MLU B.V., Yandex’s ride-sharing and food delivery joint venture with Uber, announced acquisition of selected assets of Vezet Group, including the call centers and cargo business, for $178 million in cash. The transaction was completed on February 2, 2021

“I am very proud of how well we navigated through 2020,” said Tigran Khudaverdyan, Deputy Chief Executive Officer of Yandex. “We were able to deliver solid results across our core business lines and at the same time capture emerging opportunities. Our Yandex.Plus subscription, with over 8 million subscribers, emerged as an important driver of loyalty and engagement on our platform. We entered 2021 in a strong position, and we are focused now on maintaining the solid momentum we have built while accelerating growth and investments across our E-commerce assets.”

“We demonstrated resilience in our financial performance throughout the year,” said Greg Abovsky, Chief Operating Officer and Chief Financial Officer of Yandex. “We continued to diversify our operations, with non-advertising segments accounting for almost half of our total revenue for the full year 2020. Our two largest businesses – Search & Portal and Ride-Hailing – delivered solid results allowing us to fund our investments into new attractive opportunities. Our strong track record of capital allocation, combined with our financial discipline and robust balance sheet, position us well for further growth in 2021.”

Impact of the COVID-19 Pandemic

Though the COVID-19 pandemic continued to have a material impact on our financial results and operations in Q4 2020, we have seen improved financial performance in some of our key businesses, including online advertising. The businesses that saw an acceleration of demand during the pandemic continued to demonstrate solid growth trends, including our FoodTech businesses, Media Services and Yandex.Market marketplace. We believe this is related to the change in consumer behavior and habits, and low penetration of these services in Russia.

The number of new COVID-19 cases in Russia continued to grow in the fourth quarter, peaked in December and started to slow down in January 2021. In the beginning of the year the trends in our core advertising and trips dynamics in mobility businesses (ride-hailing and car-sharing) have been comparable to the end of the 2020. The performance in the upcoming months will highly depend on the epidemiological situation in Russia (including the potential spread of new variants of the coronavirus and vaccination progress) as well as the speed of economic recovery in 2021.

With regard to our financial position as of December 31, 2020, our analysis of the effect of COVID-19 on goodwill, non-current assets and redeemable non-controlling interests shows no measurable impact. At the same time, the full impact of COVID-19 is still unknown and there is limited visibility on the sustainability and the further dynamic of the performance recovery across Yandex businesses.

The extent to which the COVID-19 crisis impacts our results in any given period will depend on future developments, which are still uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and its variants, and the actions to contain the virus or treat its impact, among others. The development of the situation with respect to COVID-19 may also lead to changes in estimates and assumptions that affect the reported amounts of assets and liabilities. Actual results could differ from those estimates.

Consolidated Results

The following table provides a summary of our key consolidated financial results for the three and twelve months ended December 31, 2019 and 2020, which consolidates Yandex.Market financial results from July 24, 2020:

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

51,696

71,599

39%

175,391

218,344

24%

Ex-TAC revenues4

45,177

65,683

45%

152,251

198,398

30%

Income from operations

4,891

4,380

-10%

24,700

16,249

-34%

Adjusted EBITDA

13,230

14,040

6%

51,014

49,762

-2%

Net income

281

402

43%

11,199

24,149

116%


Adjusted net income

5,399

6,309

17%

23,540

21,018

-11%

The table below provides a summary of our key financial results excluding Yandex.Market for the three and twelve months ended December 31, 2019 and 2020:

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

51,696

63,870

24%

175,391

205,984

17%

Ex-TAC revenues4

45,177

58,136

29%

152,251

186,329

22%

Income from operations

4,891

8,418

72%

24,700

22,215

-10%

Adjusted EBITDA

13,230

17,073

29%

51,014

53,879

6%

Net income

1,824

4,190

130%

15,529

13,039

-16%

Adjusted net income

6,942

9,765

41%

27,870

28,529

2%

(4) Numbers for the previous periods were restated to reflect immaterial adjustments of TAC revenue and expenses associated to the presentation of certain content related streams.

Our segment disclosure is available in the Segment financial results section below.

Consolidated revenues breakdown

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019*

2020

Change

2019*

2020

Change

Online advertising revenues:

Yandex properties

27,684

32,357

17%

96,466

105,163

9%

Advertising network

6,641

6,045

-9%

25,272

21,287

-16%

Total online advertising revenues

34,325

38,402

12%

121,738

126,450

4%

Revenues related to Taxi segment

14,428

21,645

50%

45,474

66,955

47%

Other

2,943

11,552

293%

8,179

24,939

205%

Total revenues

51,696

71,599

39%

175,391

218,344

24%

* Numbers for the previous periods were restated to reflect immaterial adjustments of TAC revenue and expenses associated to the presentation of certain content related streams.

Online advertising revenues grew 12% in Q4 2020 compared with Q4 2019 and generated 54% of total revenues. Online advertising revenues on a like-for-like basis excluding revenues of Yandex.Market from Q4 2020 increased 4% in Q4 2020 compared with Q4 2019. Online advertising revenues on a like-for-like basis including revenues of Yandex.Market in Q4 2019 grew 6% YoY.

Online advertising revenues from Yandex properties increased 17% in Q4 2020 compared with Q4 2019 and accounted for 45% of total revenues. Excluding revenues of Yandex.Market from Q4 2020, online advertising revenues from Yandex properties increased 8% in Q4 2020 compared with Q4 2019. The increase was primarily driven by search and Yandex websites revenues.

Online advertising revenues from our advertising network decreased 9% in Q4 2020 compared with Q4 2019 and accounted for 8% of total revenues. The decrease was primarily attributed to the adverse effect of COVID-19 on advertisers’ activity in the partner network as well as due to decrease of ad inventory from some of our partners.

Revenues related to the Taxi segment grew 50% in Q4 2020 compared with Q4 2019 and accounted for 30% of total revenues, compared with 28% of total revenues in Q4 2019. Revenues related to the Taxi segment include revenues from our Ride-hailing, Logistics and FoodTech businesses as well as Yandex.Drive, our car-sharing business. The increase of revenues related to the Taxi segment was attributed to the growth of our FoodTech businesses, driven by our hyperlocal grocery delivery service, Yandex.Lavka, and the strong performance of Yandex.Eats business, as well as to the growth of Ride-hailing and Logistics businesses, and our corporate Taxi business, the revenues of which we recognize on a gross basis.


Other revenues grew 293% in Q4 2020 compared with Q4 2019 and amounted to 16% of total revenues. Excluding non-advertising revenues of Yandex.Market, other revenues grew 120%. This growth was primarily driven by subscription revenues of Media Services, our initiatives related to IoT (Internet of Things) and expansion of our Cloud businesses.

Consolidated Operating Costs and Expenses

Our operating costs and expenses consist of cost of revenues, product development expenses, sales, general and administrative expenses (SG&A), depreciation and amortization expenses (D&A) and goodwill impairment. Apart from D&A and goodwill impairment, each of the above expense categories include personnel-related costs and expenses, relevant office space rental, and related share-based compensation expense. Increases across all cost categories reflect investments in overall growth. In Q4 2020 our headcount increased by 398 full-time employees, compared to Q3 2020. The total number of full-time employees was 11,864 as of December 31, 2020, up by 3% compared with September 30, 2020, and up 18% from December 31, 2019, which is primarily driven by the consolidation of Yandex.Market.

Cost of revenues, including traffic acquisition costs (TAC)

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019*

2020

Change

2019*

2020

Change

TAC:

Related to the Yandex advertising network

4,317

3,647

-16%

15,518

12,856

-17%

Related to distribution partners

2,202

2,269

3%

7,622

7,090

-7%

Total TAC

6,519

5,916

-9%

23,140

19,946

-14%

Total TAC as a % of total revenues

12.6%

8.3%

13.2%

9.1%

Costs related to Taxi segment

7,029

11,810

68%

20,642

35,705

73%

Costs related to Taxi segment as a % of revenues

13.6%

16.5%

11.8%

16.4%

Other cost of revenues

4,117

13,720

233%

12,006

30,083

151%

Other cost of revenues as a % of revenues

8.0%

19.2%

6.8%

13.8%

Total cost of revenues

17,665

31,446

78%

55,788

85,734

54%

Total cost of revenues as a % of revenues

34.2%

43.9%

31.8%

39.3%

* Numbers for the previous periods were restated to reflect immaterial adjustments of TAC revenue and expenses associated to the presentation of certain content related streams.

TAC decreased 9% in Q4 2020 compared with Q4 2019 and represented 8.3% of total revenues, down 430 basis points compared with Q4 2019 and 60 basis points higher compared with Q3 2020. The total TAC decrease was primarily driven by the decline of partner TAC due to lower ad network revenues and partner TAC rates as well as by optimization of distribution TAC rates.

Costs related to the Taxi segment increased 68% compared with Q4 2019. The growth was mainly a result of the increase of the costs of goods sold (COGS) in our FoodTech services, mainly reflecting the growth of Yandex.Lavka, our hyperlocal grocery delivery service, and the increase of costs related to our corporate Taxi offering. We are the principal in transactions with our Taxi corporate clients, therefore, we recognize both revenues and cost of revenues on a gross basis.

Other cost of revenues in Q4 2020 increased 233% compared with Q4 2019, primarily driven by consolidation of Yandex.Market. Excluding cost of revenues related to Yandex.Market, other costs of revenues were up 57% as a result of our investments in content within Media Services and Search and Portal, as well as our IoT initiatives.

Product development

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Product development

8,101

10,027

24%

29,209

36,339

24%


As a % of revenues

15.6%

14.0%

16.7%

16.7%

Product development expenses grew 24% in Q4 2020 compared to Q4 2019, primarily reflecting the addition of Yandex.Market personnel, the growth of share-based compensation and the increase of personnel expenses.

Sales, general and administrative (SG&A)

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Sales, general and administrative

16,301

20,901

28%

50,155

62,335

24%

As a % of revenues

31.5%

29.2%

28.6%

28.5%

SG&A expenses grew 28% in Q4 2020 compared to Q4 2019. The growth was driven by the increase of advertising and marketing expenses following the consolidation of Yandex.Market, and as a result of the increase of share-based compensation and personnel costs.

Share-based compensation (SBC) expense

SBC expense is included in each of the cost of revenues, product development, and SG&A categories discussed above.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

SBC expense included in cost of revenues

89

124

39%

293

449

53%

SBC expense included in product development

1,620

2,599

60%

6,294

9,216

46%

SBC expense included in SG&A

1,010

2,092

107%

3,268

6,063

86%

Total SBC expense

2,719

4,815

77%

9,855

15,728

60%

As a % of revenues

5.3%

6.7%

5.6%

7.2%

Total SBC expense increased 77% in Q4 2020 compared with Q4 2019. The growth was primarily related to the exchange of subsidiary-level equity awards previously granted by MLU for new Yandex N.V. restricted share units (RSUs). The Company accounted for the exchange as a modification resulting in additional cost recognized in Q4 2020. In addition, the increase reflected new equity-based grants made in 2019-2020, as well as material appreciation of the U.S. dollar against the ruble.

Depreciation and amortization (D&A) expense

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Depreciation and amortization

3,976

4,845

22%

14,777

17,687

20%

As a % of revenues

7.7%

6.8%

8.4%

8.1%

D&A expense increased 22% in Q4 2020 compared with Q4 2019. The D&A expense increase was mainly driven by amortization of intangible assets, servers and other equipment. Intangible assets amortization increased primarily due to consolidation of Yandex.Market in Q3 2020.

Income from operations

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Income from operations

4,891

4,380

-10%

24,700

16,249

-34%

Income from operations decreased 10% in Q4 2020 compared with Q4 2019. Excluding Yandex.Market, income from operations increased 72% in Q4 2020 compared with Q4 2019, primarily reflecting improved profitability of our key businesses (including Search & Portal and Taxi), partially offset by investments in our rapidly growing new businesses.


Segment financial results 5

Search & Portal

Our Search and Portal segment offers a broad range of services in Russia, Belarus, Kazakhstan and Uzbekistan.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues:

Search and Portal

34,364

37,085

8%

121,547

124,321

2%

Search and Portal, excluding IoT

33,577

35,156

5%

120,071

120,622

0.5%

Revenues Ex-TAC:

Search and Portal

27,047

30,821

14%

95,558

102,296

7%

Search and Portal, excluding IoT

26,260

28,892

10%

94,082

98,597

5%

Adjusted EBITDA:

Search and Portal

15,228

17,281

13%

57,618

60,020

4%

Search and Portal, excluding IoT

15,585

17,732

14%

58,470

60,900

4%

Adjusted EBITDA margin:

Search and Portal

44.3%

46.6%

2.3%

47.4%

48.3%

0.9%

Search and Portal, excluding IoT

46.4%

50.4%

4.0%

48.7%

50.5%

1.8%

Revenues increased by 8% year-on-year in Q4 2020, driven by Yandex Properties growth and increase of IoT sales (more than doubled on year-on-year basis), partially offset by Yandex ad network revenues decline.

Ex-TAC revenues increased by 14% in Q4 2020 compared to Q4 2019, reflecting optimization of traffic acquisition costs and growing share of own properties in the total advertising revenues.

Taxi

The Taxi segment includes our Ride-hailing business (including Yandex.Go and Uber in Russia and 17 other countries across CIS and EMEA), logistics and ride-hailing B2B services, FoodTech business (including Yandex.Eats, our ready-to-eat delivery service, and Yandex.Lavka, our hyperlocal grocery delivery service) and Yandex.Drive, our car-sharing business.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues:

Ride-hailing & FoodTech

11,942

19,727

65%

38,043

59,430

56%

Drive

2,552

2,524

-1%

7,544

8,525

13%

Total revenues

14,494

22,251

54%

45,587

67,955

49%

Adjusted EBITDA:

Ride-hailing & FoodTech

826

1,675

103%

2,253

5,214

131%

Drive

(978)

92

n/m

(2,144)

(1,777)

-17%

Total Adjusted EBITDA

(152)

1,767

n/m

109

3,437

n/m

Adjusted EBITDA margin:

Ride-hailing & FoodTech

6.9%

8.5%

1.6%

5.9%

8.8%

2.9%

Drive

-38.3%

3.6%

41.9%

-28.4%

-20.8%

7.6%

Total Adjusted EBITDA margin

-1.0%

7.9%

8.9%

0.2%

5.1%

4.9%

Taxi segment revenues increased by 54%, primarily driven by the solid performance of our Yandex.Lavka business, as well as the growth of Yandex.Eats, our food delivery business and our corporate Taxi business, where we recognize revenue on a gross basis.

Adjusted EBITDA of Taxi was RUB 1,767 million in Q4 2020, up from negative RUB 152 million in Q4 2019. The increase of adjusted EBITDA was primarily driven by significant improvement of Yandex.Drive adjusted EBITDA as well as by the improving profitability of our ride-hailing and food delivery businesses, partially offset by the losses of the rapidly growing Yandex.Lavka business and investments in the development of our Logistics services.


Yandex.Market

The Yandex.Market segment includes the price comparison service, marketplace and several small experiments.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

-

8,659

100%

-

13,867

100%

Adjusted EBITDA:

-

(3,036)

100%

-

(4,113)

100%

Adjusted EBITDA margin:

-

-35.1%

-

-

-29.7%

-

The table below presents the standalone financial results of the Yandex.Market segment on a comparable basis, which present the standalone financial results of this business for the full three and twelve months periods ended December 31, 2019 and 2020.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019 *

2020

Change

2019 *

2020

Change

Revenues

7,400

8,659

17%

19,370

28,831

49%

Adjusted EBITDA:

(2,852)

(3,036)

6%

(8,263)

(8,293)

0.4%

Adjusted EBITDA margin:

-38.5%

-35.1%

3.4%

-42.7%

-28.8%

13.9%

* Financial results of Yandex.Market for the full year and three months periods ended December 31, 2019 were not included in Yandex’s consolidated financial results on a consolidated basis, but portion of the results were recognized in line «Loss from equity method investments» due to accounting for the equity stake in Yandex.Market.

Yandex.Market total revenues grew 17% in Q4 2020 compared with Q4 2019, driven by the solid revenue growth in our price comparison platform and marketplace GMV offset by the changes in marketplace revenue mix. The revenue growth of the price comparison business accelerated to a strong 29% year-on-year revenue growth. The GMV of Yandex.Market marketplace increased by 71% year-on-year in Q4 2020 on the back of strong orders growth, partially offset by decreasing average order value, driven by decelerating real disposable incomes, customers adaptation to consolidated platform post rebranding of Beru marketplace and its integration with Yandex.Market price comparison platform. The revenue of our marketplace was affected by the changing mix: we successfully shifted to 3P model and the share of the third-party sales (which we recognize on a commission basis compared with first-party sales recognized on a gross basis) has almost doubled on year-on-year basis and reached 63.5% in Q4 2020 (66% in December) compared with 34% in Q4 2019.

Adjusted EBITDA loss of Yandex.Market business was RUB 3.0 billion in Q4 2020, compared to RUB 2.9 billion in Q4 2019, as we continued to invest in expansion of our fulfillment and delivery infrastructure, as well as provided additional marketing support after marketplace rebranding in the beginning of October 2020.

Classifieds

The Classifieds segment includes Auto.ru, Yandex.Realty and Yandex.Jobs.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

1,611

1,818

13%

5,390

5,778

7%

Adjusted EBITDA:

330

599

82%

310

1,070

245%

Adjusted EBITDA margin:

20.5%

32.9%

12.4%

5.8%

18.5%

12.7%

Classifieds revenues increased 13% in Q4 2020 compared with Q4 2019, primarily driven by growth of auto vehicle reports and listing fees revenues. Classifieds revenue growth decelerated slightly compared to Q3 2020, as COVID-related supply chain disruptions continued to put pressure on demand-supply balance (though the situation began to improve in December).

Media Services


The Media Services segment includes KinoPoisk, Yandex.Music, Yandex.Afisha, our production center Yandex.Studio and our subscription service Yandex.Plus.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

1,333

2,901

118%

3,867

7,807

102%

Adjusted EBITDA:

(688)

(1,141)

66%

(2,202)

(3,735)

70%

Adjusted EBITDA margin:

-51.6%

-39.3%

12.3%

-56.9%

-47.8%

9.1%

Media Services revenues grew 118% in Q4 2020 compared with Q4 2019. The increase was primarily driven by the growth of Yandex.Plus subscription revenues partially offset by decline in advertising and ticketing revenues. Increasing adjusted EBITDA losses reflect our investments in content and marketing on the back of increased demand for our services.

Other Bets and Experiments

The Other Bets and Experiments category includes our self-driving vehicles business (“Yandex SDG”), Zen, Geolocation Services (“Geo”), Edadeal, Investments, Yandex.Cloud and Yandex.Education.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020

Change

Revenues

2,659

4,138

56%

7,877

11,851

50%

Adjusted EBITDA:

(1,542)

(1,475)

-4%

(5,022)

(7,259)

45%

Adjusted EBITDA margin:

-58.0%

-35.6%

22.4%

-63.8%

-61.3%

2.5%

Other Bets and Experiments revenues increased 56% in Q4 2020 compared with Q4 2019. The increase was primarily driven by the fast growth in Zen and Geo, as well as our Cloud business (Cloud revenues increased 4.3x compared with Q4 2019).

The adjusted EBITDA loss amounted to RUB 1.5 billion, down from a loss of RUB 1.9 billion in Q3 2020, primarily driven by the improved performance in Geo, Cloud and Zen businesses, partially offset by somewhat higher investments in Yandex SDG (where adjusted EBITDA loss was RUB 920 million in Q4 2020) and our Education initiatives.

Eliminations

Eliminations related to our revenues represent the elimination of transactions between the reportable segments, primarily related to advertising. Eliminations related to our adjusted EBITDA mainly reflect reallocation of a portion of Search and Portal D&A expenses related to leasehold improvements to office rent expenses of our business units.

In RUB millions

Three months ended December 31, 

Twelve months ended December 31, 

2019

2020

Change

2019

2020 *

Change

Revenues:

Segment revenues

54,461

76,852

41%

184,268

231,579

26%

Eliminations

(2,765)

(5,253)

90%

(8,877)

(13,235)

49%

Total revenues

51,696

71,599

39%

175,391

218,344

24%

Adjusted EBITDA:

Segment adjusted EBITDA

13,176

13,995

6%

50,813

49,420

-3%

Eliminations

54

45

-17%

201

342

70%

Total adjusted EBITDA

13,230

14,040

6%

51,014

49,762

-2%

* Including RUB 13,867 million of revenues and RUB 4,113 million of adjusted EBITDA loss of Yandex.Market since July 24, 2020.

Eliminations related to our revenues increased 90% in Q4 2020 compared with Q4 2019. Excluding Yandex.Market, eliminations related to our revenues increased 60% in Q4 2020. The increase was mainly attributed to higher intercompany


TAC related to fast growing Zen business, the intercompany eliminations related to Yandex.Plus program as well as intercompany revenue in Search & Portal.

Adjusted EBITDA increased 6% in Q4 2020 compared with Q4 2019. Excluding Yandex.Market, adjusted EBITDA increased 29%. The growth was mainly driven by the solid performance of the Search and Portal and Taxi segments and year-on-year improvement in the profitability of Classifieds segment, which were slightly offset by our investments in Media Services.

Interest income in Q4 2020 was RUB 1,161 million, compared with RUB 807 million in Q4 2019.

Interest expense in Q4 2020 was RUB 747 million, up from RUB 31 million in Q4 2019, reflecting interest on the convertible bonds issued in February 2020.

Foreign exchange loss in Q4 2020 was RUB 831 million, compared with a foreign exchange loss of RUB 999 million in Q4 2019. This loss reflects the appreciation of the Russian ruble during Q4 2020 from RUB 79.6845 to $1.00 on September 30, 2020, to RUB 73.8757 to $1.00 on December 31, 2020. Our Russian operating subsidiaries' functional currency is the Russian ruble, and therefore changes due to exchange rate fluctuations in the ruble value of these subsidiaries' monetary assets and liabilities that are denominated in other currencies are recognized as foreign exchange gains or losses within the other income/(loss), net line in the unaudited condensed consolidated statements of income. Although the U.S. dollar value of our U.S. dollar-denominated assets and liabilities was not impacted by these currency fluctuations, they resulted in a downward revaluation of the ruble equivalent of these U.S. dollar-denominated monetary assets and liabilities in Q4 2020.

Income tax expense for Q4 2020 was RUB 3,788 million, up from RUB 3,068 million in Q4 2019. Our effective tax rate of 90.4% in Q4 2020 was lower than 91.6% in Q4 2019. If we remove the effects of SBC expense, deferred tax asset valuation allowances, tax provisions recognized, goodwill impairment and certain losses from equity-method investments which are non-deductible, our effective tax rate for Q4 2020 was 19.4%, compared with 23.1% for Q4 2019 as corrected for similar effects in that year. The decrease in the tax rate without above-mentioned effects was primarily driven by the permanent difference between US GAAP and tax accounting in the books of our certain foreign subsidiaries.

Net income was RUB 0.4 billion ($5.4 million) in Q4 2020, up 43% compared with the net income of RUB 0.3 billion in Q4 2019.

Adjusted net income in Q4 2020 was RUB 6.3 billion ($85.4 million), a 17% increase from Q4 2019.

Adjusted net income margin was 8.8% in Q4 2020, compared with 10.4% in Q4 2019.

As of December 31, 2020, Yandex had cash, cash equivalents and term deposits of RUB 238.2 billion ($3,224.2 million), including cash, cash equivalents and term deposits of Yandex.Taxi in total amount of RUB 27.3 billion ($370.1 million).

Net cash flow provided by operating activities for Q4 2020 was RUB 6.1 billion ($83.1 million) and capital expenditures were RUB 7.2 billion ($97.1 million).

Redeemable noncontrolling interests presented in our unaudited condensed consolidated balance sheets relate to the equity incentive arrangements we have made available to the senior employees of the Taxi, Classifieds and Yandex.Market segments, pursuant to which such persons are eligible to acquire depositary receipts, or receive options to acquire depositary receipts, which entitles them to economic interests in the respective business unit subsidiaries.

The total number of shares issued and outstanding as of December 31, 2020 was 354,210,533, including 318,501,858 Class A shares, 35,708,674 Class B shares, and one Priority share and excluding 1,928,621 Class A shares held in treasury and all Class C shares outstanding solely as a result of the conversion of Class B shares into Class A shares. Any such Class C shares will be cancelled.

There were also employee share options outstanding to purchase up to an additional 2.8 million shares, at a weighted average exercise price of $38.70 per share, 1.7 million of which were fully vested; equity-settled share appreciation rights (SARs) for 0.1 million shares, at a weighted average measurement price of $32.72, all of which were fully vested; restricted share units (RSUs) covering 15.9 million shares, of which RSUs to acquire 5.4 million shares were fully vested and


performance share units (PSUs) for 0.2 million shares. Equity awards in respect of business unit subsidiaries are described under Redeemable noncontrolling interests above.

Financial outlook

Assuming no further escalation of the coronavirus pandemic and gradual improvement of the situation from the second quarter of the year, we expect our total group revenues to be between 305 and 320 billion rubles for the full year 2021. The growth will be primarily driven by an acceleration of revenue dynamic across our E-commerce businesses (Yandex.Market, Lavka and grocery part of Yandex.Eats), as well as recovery in Search & Portal and Ride-hailing segments.

Our outlook reflects our current view, based on the trends that we see in the beginning of the year, and may change subject to the economic impact of the coronavirus pandemic and potential further disruptions caused by the health crisis.

Conference Call Information

Yandex’s management will hold an earnings conference call on February 16, 2021 at 8:00 AM U.S. Eastern Time (4:00 PM Moscow time; 1:00 PM London time).

We recommend using the dial-in option if you plan to ask questions. In this case please dial-in at least 10 minutes prior to the call start time (using dial-in number and confirmation code stated below).

To access the conference call live, please dial:

US: +1 646 828 8193

UK/International: +44 (0) 330 336 9411

Russia: 8 10 800 2867 5011

Passcode: 8261645

A live and archived webcast of this conference call will be available at

https://www.webcast-eqs.com/yandex20210216

Following the call, a webcast replay will be available at the Yandex Investor Relations website at https://ir.yandex/events-and-presentations

ABOUT YANDEX

Yandex (NASDAQ and MOEX: YNDX) is a technology company that builds intelligent products and services powered by machine learning. Our goal is to help consumers and businesses better navigate the online and offline world. Since 1997, we have delivered world-class, locally relevant search and information services. Additionally, we have developed market-leading on-demand transportation services, navigation products and other mobile applications for millions of consumers across the globe. Yandex, which has more than 30 offices worldwide, has been listed on the NASDAQ since 2011.

More information on Yandex can be found at https://yandex.com/company.

FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements that involve risks and uncertainties. All statements contained in this press release other than statements of historical facts, including, without limitation, statements regarding our future financial and business performance, our business and strategy and the impact of the COVID-19 pandemic on our industry, business and financial results, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “estimate,” “expect,” “guide,” “intend,” “likely,” “may,” “will” and similar expressions and their negatives are intended to identify forward-looking statements. Actual results may differ materially from the results predicted or implied by such statements, and our reported


results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted or implied by such statements include, among others, the impact of the ongoing COVID-19 pandemic and regulatory and business responses to that crisis, macroeconomic and geopolitical developments affecting the Russian economy or our business, changes in the political, legal and/or regulatory environment, competitive pressures, changes in advertising patterns, changes in user preferences, technological developments, and our need to expend capital to accommodate the growth of the business, as well as those risks and uncertainties included under the captions “Risk Factors” and “Operating and Financial Review and Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2019 and “Risk Factors” in the Shareholder Circular filed as Exhibit 99.2 to our Current Report on Form 6-K, which were filed with the U.S. Securities and Exchange Commission (SEC) on April 2, 2020 and November 18, 2019, respectively, and are available on our investor relations website at https://ir.yandex/sec-filings and on the SEC website at www.sec.gov. All information in this release and in the attachments is as of February 16, 2021, and Yandex undertakes no duty to update this information unless required by law.

USE OF NON-GAAP FINANCIAL MEASURES

To supplement the financial information prepared and presented in accordance with U.S. GAAP, we present the following non-GAAP financial measures: ex-TAC revenues, adjusted EBITDA, adjusted EBITDA margin, adjusted ex-TAC EBITDA margin, adjusted net income, adjusted net income margin, adjusted ex-TAC net income margin, financial results on a like-for-like basis excluding Yandex.Market and online advertising revenues on a like-for-like basis including revenues of Yandex.Market. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. For more information on these non-GAAP financial measures, please see the tables captioned “Reconciliations of non-GAAP financial measures to the nearest comparable U.S. GAAP measures”, included following the accompanying financial tables. We define the various non-GAAP financial measures we use as follows:

Ex-TAC revenues means U.S. GAAP revenues less total traffic acquisition costs (TAC)
Adjusted EBITDA means U.S. GAAP net income plus (1) depreciation and amortization, (2) SBC expense, (3) accrual of expense related to the contingent compensation payable to employees in connection with certain business combinations, (4) one-off restructuring expenses, (5) interest expense, (6) loss/(income) from equity method investments, (7) other loss /(income), net, (8) income tax expense and (9) goodwill impairment, less (1) interest income and (2) effect of Yandex.Market consolidation
Adjusted EBITDA margin means adjusted EBITDA divided by U.S. GAAP revenues
Adjusted ex-TAC EBITDA margin means adjusted EBITDA divided by ex-TAC revenues
Adjusted net income means U.S. GAAP net income plus (1) SBC expense adjusted for the income tax attributable to the SBC expense, (2) accrual of expense related to the contingent compensation payable to certain employees in connection with certain business combinations, (3) foreign exchange losses/(gains) adjusted for related (reduction)/increase in income tax, (4) one-off restructuring expenses, (5) loss from disposal of investments, (6) amortization of debt discount related to our convertible debt adjusted for the related reduction in income tax and (7) goodwill impairment, less (1) deconsolidation of former subsidiaries and (2) effect of Yandex.Market consolidation
Adjusted net income margin means adjusted net income divided by U.S. GAAP revenues
Adjusted ex-TAC net income margin means adjusted net income divided by ex-TAC revenues
Financial results on a like-for-like basis excluding Yandex.Market means revenues, ex-TAC revenues, income from operations, adjusted EBITDA and net income which completely exclude the results of Yandex.Market post the consolidation, gain from consolidation of Yandex.Market and loss from equity method investments associated with Yandex.Market for the period prior to the consolidation
Online advertising revenues on a like-for-like basis including revenues of Yandex.Market means revenues, which include the results of Yandex.Market for the period prior to the consolidation.

These non-GAAP financial measures are used by management for evaluating financial performance as well as decision-making. Management believes that these metrics reflect the organic, core operating performance of the company, and therefore are useful to analysts and investors in providing supplemental information that helps them understand, model and forecast the evolution of our operating business.


Although our management uses these non-GAAP financial measures for operational decision-making and considers these financial measures to be useful for analysts and investors, we recognize that there are a number of limitations related to such measures. In particular, it should be noted that several of these measures exclude some recurring costs, particularly share-based compensation. In addition, the components of the costs that we exclude in our calculation of the measures described above may differ from the components that our peer companies exclude when they report their results of operations.

Below we describe why we make particular adjustments to certain U.S. GAAP financial measures:

TAC

We believe that it may be useful for investors and analysts to review certain measures both in accordance with U.S. GAAP and net of the effect of TAC, which we view as comparable to sales commissions and bonuses but, unlike sales commissions and bonuses, are not deducted from U.S. GAAP revenues. By presenting revenue, adjusted EBITDA margin and adjusted net income margin net of TAC, we believe that investors and analysts are able to obtain a clearer picture of our business without the impact of the revenues we share with our partners.

SBC

SBC is a significant expense item, and an important part of our compensation and incentive programs. As it is a non-cash charge, however, and highly dependent on our share price at the time of equity award grants, we believe that it is useful for investors and analysts to see certain financial measures excluding the impact of these charges in order to obtain a clearer picture of our operating performance.

Acquisition-related costs

We may incur expenses in connection with acquisitions that are not indicative of our recurring core operating performance. In particular, we are required under U.S. GAAP to accrue as expense the contingent compensation that is payable to certain employees in connection with certain business combinations. We eliminate these acquisition-related expenses from adjusted EBITDA and adjusted net income to provide management and investors a tool for comparing on a period-to-period basis our operating performance in the ordinary course of operations.

Foreign exchange gains and losses

Because we hold significant assets and liabilities in currencies other than our Russian ruble operating currency, and because foreign exchange fluctuations are outside of our operational control, we believe that it is useful to present adjusted EBITDA, adjusted net income and related margin measures excluding these effects, in order to provide greater clarity regarding our operating performance.

One-off restructuring expenses

Adjusted net income and adjusted EBITDA exclude expenses related to restructuring targeted amendments to Corporate Governance Structure approved by shareholders in December 2019. We believe that it is useful to present adjusted net income, adjusted EBITDA and related margin measures excluding impacts not related to our operating activities.

Effect of Yandex.Market consolidation

We adjust net income and EBITDA for gain on Yandex.Market consolidation. We have eliminated this gain from adjusted net income and adjusted EBITDA as we believe that it is useful to present adjusted net income, adjusted EBITDA and related margins measures excluding impacts not related to our operating activities.

Loss from disposal of investment in Yandex.Money

We adjust net income for loss from disposal of investment in Yandex.Money. We have added this loss to adjusted net income as we believe that it is useful to present adjusted net income and related margin measures excluding impacts not related to our operating activities.


Amortization of debt discount

We also adjust net income for interest expense representing amortization of the debt discount related to our convertible senior notes due 2025 issued in Q1 2020. We have eliminated this expense from adjusted net income as it is non-cash in nature and is not indicative of our ongoing operating performance.

Goodwill impairment

Adjusted net income and adjusted EBITDA for Q4 2019 exclude a loss from goodwill impairment related to Food Party business. In Q4 2019, we recognized a goodwill impairment charge for RUB 762 million which is the amount by which the carrying value of goodwill exceeds its implied fair value. We believe that it is useful to present adjusted net income, adjusted EBITDA and related margin measures excluding impacts not indicative of our ongoing operating performance.

The tables at the end of this release provide detailed reconciliations of each non-GAAP financial measure we use from the most directly comparable U.S. GAAP financial measure.


YANDEX N.V.

Unaudited Condensed Consolidated Balance Sheets

(in millions of Russian rubles and U.S. dollars, except share and per share data)

As of

December 31,

December 31, 

December 31, 

2019*

2020

2020

RUB

RUB

$

ASSETS

Current assets:

Cash and cash equivalents

56,415

132,398

1,792.2

Term deposits

31,891

105,787

1,432.0

Accounts receivable, net

17,832

25,440

344.4

Prepaid expenses

3,315

6,727

90.9

Inventory

808

4,810

65.1

Funds receivable, net

1,226

2,289

31.0

Other current assets

8,797

12,950

175.3

Total current assets

120,284

290,401

3,930.9

Property and equipment, net

47,856

61,772

836.2

Operating lease right-of-use assets

21,218

20,800

281.6

Intangible assets, net

10,365

21,842

295.7

Non-current content assets, net

3,295

7,464

101.0

Goodwill

52,205

106,493

1,441.5

Long-term prepaid expenses

2,289

1,391

18.8

Investments in non-marketable equity securities

28,073

1,135

15.4

Deferred tax assets

1,847

1,639

22.2

Other non-current assets

3,694

4,893

66.2

TOTAL ASSETS

291,126

517,830

7,009.5

LIABILITIES AND SHAREHOLDERS’ EQUITY

Current liabilities:

Accounts payable and accrued liabilities

34,978

43,634

590.6

Income and non-income taxes payable

8,020

11,440

154.9

Deferred revenue

3,542

6,645

89.9

Total current liabilities

46,540

61,719

835.4

Convertible debt

-

83,277

1,127.3

Deferred tax liabilities

1,951

6,056

82.0

Operating lease liabilities

10,841

12,830

173.7

Other accrued liabilities

2,359

4,689

63.4

Total liabilities

61,691

168,571

2,281.8

Commitments and contingencies

Redeemable noncontrolling interests

14,246

3,167

42.9

Shareholders’ equity:

Priority share: €1.00 par value; shares authorized (1 and 1), shares issued (1 and 1) and outstanding (nil and 1)

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: 293,527,655 and 320,430,479, Class B: 37,138,658 and 35,708,674, and Class C: 610,000 and 1,429,984, respectively); shares outstanding (Class A: 292,719,508 and 318,501,858, Class B: 37,138,658 and 35,708,674, and Class C: nil)

261

278

3.8

Treasury shares at cost (Class A: 808,147 and 1,928,621, Priority share: 1 and nil, respectively)

(411)

(6)

(0.1)

Additional paid-in capital

68,050

160,762

2,176.1

Accumulated other comprehensive income

4,841

17,976

243.3

Retained earnings

122,187

146,988

1,989.7

Total equity attributable to Yandex N.V.

194,928

325,998

4,412.8

Noncontrolling interests

20,261

20,094

272.0

Total shareholders’ equity

215,189

346,092

4,684.8

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

291,126

517,830

7,009.5

Derived from audited consolidated financial statements


YANDEX N.V.

Unaudited Condensed Consolidated Statements of Income

(in millions of Russian rubles and U.S. dollars, except share and per share data)

Three months ended December 31, 

2019

2020

2020

RUB

RUB

$

Revenues

51,696

71,599

969.2

Operating costs and expenses:

Cost of revenues(1)

17,665

31,446

425.7

Product development(1)

8,101

10,027

135.7

Sales, general and administrative(1)

16,301

20,901

282.9

Depreciation and amortization

3,976

4,845

65.6

Goodwill impairment

762

-

-

Total operating costs and expenses

46,805

67,219

909.9

Income from operations

4,891

4,380

59.3

Interest income

807

1,161

15.7

Interest expense

(31)

(747)

(10.1)

(Loss)/income from equity method investments

(1,403)

2

-

Other loss, net

(915)

(606)

(8.2)

Net income before income taxes

3,349

4,190

56.7

Income tax expense

3,068

3,788

51.3

Net income

281

402

5.4

Net loss attributable to noncontrolling interests

670

411

5.6

Net income attributable to Yandex N.V.

951

813

11.0

Net income per Class A and Class B share:

Basic

2.89

2.30

0.03

Diluted

2.78

2.16

0.03

Weighted average number of Class A and Class B shares outstanding

Basic

329,030,223

353,292,329

353,292,329

Diluted

336,126,257

365,970,656

365,970,656

(1) These balances exclude depreciation and amortization expenses, which are presented separately, and include share-based compensation expenses of:

Cost of revenues

89

124

1.7

Product development

1,620

2,599

35.2

Sales, general and administrative

1,010

2,092

28.3


YANDEX N.V.

Unaudited Condensed Consolidated Statements of Income

(in millions of Russian rubles and U.S. dollars, except share and per share data)

Twelve months ended December 31, 

2019*

2020

2020

RUB

RUB

$

Revenues

175,391

218,344

2,955.6

Operating costs and expenses:

Cost of revenues(1)

55,788

85,734

1,160.5

Product development(1)

29,209

36,339

491.9

Sales, general and administrative(1)

50,155

62,335

843.8

Depreciation and amortization

14,777

17,687

239.4

Goodwill impairment

762

-

-

Total operating costs and expenses

150,691

202,095

2,735.6

Income from operations

24,700

16,249

220.0

Interest income

3,315

3,869

52.4

Interest expense

(74)

(2,373)

(32.1)

Effect of Yandex.Market consolidation

-

19,230

260.3

Loss from equity method investments

(3,886)

(2,175)

(29.4)

Other (loss)/income, net

(1,200)

2,404

32.4

Net income before income taxes

22,855

37,204

503.6

Income tax expense

11,656

13,055

176.7

Net income

11,199

24,149

326.9

Net loss attributable to noncontrolling interests

1,627

1,363

18.4

Net income attributable to Yandex N.V.

12,826

25,512

345.3

Net income per Class A and Class B share:

Basic

39.21

74.87

1.01

Diluted

38.21

72.03

0.98

Weighted average number of Class A and Class B shares outstanding

Basic

327,127,314

340,764,574

340,764,574

Diluted

335,428,137

353,382,841

353,382,841

(1) These balances exclude depreciation and amortization expenses, which are presented separately, and include share-based compensation expenses of:

Cost of revenues

293

449

6.1

Product development

6,294

9,216

124.8

Sales, general and administrative

3,268

6,063

82.0

Derived from audited consolidated financial statements


YANDEX N.V.

Unaudited Condensed Consolidated Statements of Cash Flows

(in millions of Russian rubles and U.S. dollars)

Three months ended December 31, 

2019

2020

2020

RUB

RUB

$

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

281

402

5.4

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation of property and equipment

3,314

3,644

49.3

Amortization of intangible assets

662

1,201

16.3

Amortization of content assets

434

737

10.0

Operating lease right-of-use assets amortization and the lease liability accretion

2,828

2,607

35.3

Amortization of debt discount and issuance costs

-

526

7.1

Share-based compensation expense

2,719

4,815

65.2

Deferred income tax expense

11

662

9.0

Foreign exchange losses

999

831

11.2

Loss/(income) from equity method investments

1,403

(2)

-

Goodwill impairment

762

-

-

Other

34

54

0.7

Changes in operating assets and liabilities excluding the effect of acquisitions:

Accounts receivable, net

(2,061)

(6,555)

(88.7)

Prepaid expenses and other assets

(2,553)

(3,865)

(52.3)

Inventory

64

(144)

(1.9)

Accounts payable and accrued liabilities

338

1,746

23.6

Deferred revenue

751

1,951

26.4

Content assets

(2,258)

(2,503)

(33.9)

Content liabilities

897

31

0.4

Net cash from operating activities

8,625

6,138

83.1

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment and intangible assets

(5,533)

(7,176)

(97.1)

Proceeds from sale of property and equipment

8

32

0.4

Acquisitions of businesses, net of cash acquired

-

(329)

(4.5)

Investments in non-marketable equity securities

(7)

-

-

Proceeds from sale of equity securities

4,612

-

-

Investments in term deposits

(14,713)

(96,937)

(1,312.2)

Maturities of term deposits

23,628

141,830

1,919.8

Loans granted, net of proceeds from repayments

94

(472)

(6.3)

Net cash from investing activities

8,089

36,948

500.1

CASH FLOWS (USED IN)/PROVIDED BY FINANCING ACTIVITIES:

Proceeds from exercise of share options

16

1,088

14.7

Repurchases of share options

(88)

(186)

(2.5)

Ordinary shares issuance costs

-

(5)

(0.1)

Repurchases of ordinary shares

(1,422)

-

-

Proceeds from overdraft borrowings

-

397

5.4

Payment for finance leases

(125)

(63)

(0.9)

Other financing activities

(27)

(21)

(0.2)

Purchase of redeemable noncontrolling interests

(509)

(135)

(1.8)

Net cash (used in)/provided by financing activities

(2,155)

1,075

14.6

Effect of exchange rate changes on cash and cash equivalents, and restricted cash and cash equivalents

(1,678)

(5,228)

(70.8)

Net change in cash, cash equivalents, and restricted cash

12,881

38,933

527.0

Cash and cash equivalents, and restricted cash and cash equivalents, beginning of period

43,572

93,513

1,265.8

Cash and cash equivalents, and restricted cash and cash equivalents, end of period

56,453

132,446

1,792.8

Reconciliation of cash and cash equivalents, and restricted cash and cash equivalents:

Cash and cash equivalents, beginning of period

43,528

93,463

1,265.1

Restricted cash and cash equivalents, beginning of period

44

50

0.7

Cash and cash equivalents, and restricted cash and cash equivalents, beginning of period

43,572

93,513

1,265.8

Cash and cash equivalents, end of period

56,415

132,398

1,792.2

Restricted cash and cash equivalents, end of period

38

48

0.6

Cash and cash equivalents, and restricted cash and cash equivalents, end of period

56,453

132,446

1,792.8


YANDEX N.V.

Unaudited Condensed Consolidated Statements of Cash Flows

(in millions of Russian rubles and U.S. dollars)

Twelve months ended December 31, 

2019*

2020

2020

RUB

RUB

$

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

11,199

24,149

326.9

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation of property and equipment

12,164

13,862

187.6

Amortization of intangible assets

2,613

3,825

51.8

Amortization of content assets

1,167

3,013

40.8

Operating lease right-of-use assets amortization and the lease liability accretion

9,195

9,643

130.5

Amortization of debt discount and issuance costs

-

1,667

22.6

Share-based compensation expense

9,855

15,728

212.9

Deferred income tax expense