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MOSCOW and THE HAGUE, Netherlands, July 25, 2013 (GLOBE NEWSWIRE) -- Yandex (Nasdaq:YNDX), one of Europe's largest internet companies and the leading search provider in Russia, today announced its financial results for the second quarter ended June 30, 2013.
Q2 2013 Financial Highlights
Revenues of RUR 9.2 billion ($281.2 million 1), up 35% compared with Q2 2012
Ex-TAC revenues2 (excluding traffic acquisition costs) up 37% compared with Q2 2012
Income from operations of RUR 3.2 billion ($98.4 million), up 43% compared with Q2 2012
Adjusted EBITDA3 of RUR 4.3 billion ($131.6 million), up 40% compared with Q2 2012
Operating margin of 35.0%
Adjusted EBITDA margin2of 46.8%
Adjustedex-TAC EBITDA margin2 of 55.6%
Net income of RUR 2.9 billion ($89.1 million), up 47% compared with Q2 2012
Adjusted net income3 of RUR 3.1 billion ($93.5 million), up 48% compared with Q2 2012
Net income margin of 31.7%
Adjusted net income margin2of 33.2%
Adjusted ex-TAC net income margin2 of 39.5%
Cash, deposits and investments in debt securities of RUR 30.8 billion ($940.1 million) as of June 30, 2013
"Yandex delivered strong financial and operating results. We released the mobile version of our Yandex.Browser and a new, task-oriented version of Yandex.Mail," said Arkady Volozh, CEO of Yandex. "We also unveiled Yandex.Islands, a next generation search platform with interactive search results."
The following table provides a summary of key financial results for the three months and six months ended June 30, 2012 and 2013.
1Pursuant to SEC rules regarding convenience translations, Russian ruble (RUR) amounts have been translated into U.S. dollars at a rate of RUR 32.7090 to $1.00, the official exchange rate quoted as of June 30, 2013 by the Central Bank of the Russian Federation.
2This is a non-GAAP financial measure. Please see "Use of Non-GAAP Financial Measures" below for a discussion of how we define this non-GAAP financial measure. You will find a reconciliation of this non-GAAP financial measure to the most directly comparable US GAAP measure in the accompanying financial tables at the end of this release.
3Adjusted EBITDA and adjusted net income are non-GAAP financial measures. Please see "Use of Non-GAAP Financial Measures" below for a discussion of how we define adjusted EBITDA and adjusted net income. You will find a reconciliation of adjusted EBITDA and adjusted net income to GAAP net income, the most directly comparable US GAAP measure for both non-GAAP measures, in the accompanying financial tables at the end of this release.
In RUR millions
ended June 30,
ended June 30,
Ex-TAC revenues 2
Income from operations
Adjusted EBITDA 3
Adjusted net income 3
Q2 2013 Operational and Corporate Highlights
Share of Russian search market averaged 61.7% in Q2 2013 (according to LiveInternet)
SERPs (search engine result pages) grew 22% from Q2 2012
Number of advertisers grew to more than 239,000, up 24% from Q2 2012 and up 6% from Q1 2013
Introduced a new concept in search engine result pages – interactive blocks, called Islands
Launched two versions of our mobile browser – for Android-based smartphones and for the iPad
Repurchased 4 million shares as of July 24, 2013 as part of the previously announced 12 million share repurchase program
Signed a cooperation agreement with Mail.ru under which Yandex is the paid search services provider for Mail.ru
Completed the formation of the joint venture between Yandex.Money and Sberbank on July 4, 2013
In RUR millions
ended June 30,
ended June 30,
Total text-based advertising
Total advertising revenues
Online payment commissions
Text-based advertising revenues, accounting for 88% of total revenues in Q2 2013, continued to determine overall top-line performance.
Text-based advertising revenues from Yandex's own websites accounted for 73% of total revenues during Q2 2013, and increased by 37% compared with Q2 2012. Text-based advertising revenues from our ad network increased 25% compared with Q2 2012 and contributed 15% of total revenues during Q2 2013. Revenues from Yandex websites grew faster than those from our ad network as we implemented changes to our advertising technologies on our owned and operated sites.
Paid clicks on Yandex's and its partners' websites, in aggregate, increased 29% in Q2 2013 compared with Q2 2012. Our average cost per click in Q2 2013 increased 5% compared with Q2 2012.
Display advertising revenue accounted for 9% of total revenues during Q2 2013, and increased 31% compared with Q2 2012.
Online payment commissions accounted for 2% of revenues during Q2 2013, and increased 57% compared with Q2 2012. In July 2013, we completed our sale of 75% of Yandex.Money to Sberbank and the formation of our joint venture with Sberbank in respect of this business. From Q3 2013, we will deconsolidate Yandex.Money and no longer recognize its online payment commissions as revenue.
Operating Costs and Expenses
Yandex's operating costs and expenses consist of cost of revenues, product development expenses, sales, general and administrative expenses (SG&A), and depreciation and amortization expenses (D&A). Apart from D&A, each of the above expense categories includes personnel-related costs and expenses, including related share-based compensation expense. Increases across all cost categories, excluding D&A, reflect investments in overall growth, including personnel. In Q2 2013, Yandex added 326 full-time employees, an increase of 8% from March 31, 2013, and up 24% from June 30, 2012. The total number of full-time employees was 4,298 as of June 30, 2013.