6-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 6-K

 

 

REPORT OF A FOREIGN ISSUER

PURSUANT TO RULE 13A-16 OR 15D-16

OF THE SECURITIES EXCHANGE ACT OF 1934

For November 10, 2015

 

 

QIWI plc

 

 

12-14 Kennedy Ave.

Kennedy Business Centre, 2nd Floor, Office 203

1087 Nicosia Cyprus

(Address of 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  x            Form 40-F  ¨

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes  ¨            No   x

If ‘‘Yes’’ is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

EXHIBIT 99.1 TO THIS REPORT ON FORM 6-K IS INCORPORATED BY REFERENCE IN THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-190918) OF QIWI PLC AND IN THE OUTSTANDING PROSPECTUS CONTAINED IN SUCH REGISTRATION STATEMENT.

 

 

 


Exhibits

 

99.1    “QIWI Announces Third Quarter 2015 Results” press release dated November 10, 2015


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.

 

    QIWI PLC (Registrant)
Date: November 10, 2015     By:  

/s/ Alexander Karavaev

      Alexander Karavaev
      Chief Financial Officer
EX-99.1

Exhibit 99.1

 

LOGO

QIWI ANNOUNCES THIRD QUARTER 2015 RESULTS

Third-Quarter Total Adjusted Net Revenue Increased 6% to RUB 2,529 Million

Adjusted Net Profit Decreased 3% to RUB 1,133 Million or RUB 18.74 per diluted share

QIWI reiterates 2015 Guidance

NICOSIA, CYPRUS – November 10, 2015 – QIWI plc, (NASDAQ: QIWI) (“QIWI” or the “Company”) today announced results for the third quarter ended September 30, 2015.

Third-Quarter 2015 Operating and Financial Highlights

 

    Total Adjusted Net Revenue increased 6% to RUB 2,529 million ($38.2 million)

 

    Adjusted EBITDA decreased 12% to RUB 1,340 million ($20.2 million)

 

    Adjusted Net Profit decreased 3% to RUB 1,133 million ($17.1 million), or RUB 18.74 per diluted share

 

    Total payment volume increased 65% to RUB 270.5 billion ($4.1 billion)

 

    Active kiosks and terminals decreased 15% to 149,553 units

 

    Active Qiwi Wallet accounts increased 1% to 16.7 millions

“We are continuing to confront the pressure from both the macroeconomic slowdown in Russia and stricter regulation of the agent network,” said Sergey Solonin, QIWI’s chief executive officer. “Despite the abovementioned factors, we undertook actions necessary to maintain the agents’ economics and do not expect any further substantial deterioration of the agent network. Contact and Rapida are bringing synergies to the group and strengthening our positions in the payments market in Russia. We continue to see plenty of opportunities ahead, especially in gaining market share in the key verticals, which will be the main focus for the company in the near term.”

Third Quarter 2015 Results

Revenues: Total Adjusted Net Revenue for the quarter ended September 30, 2015 was RUB 2,529 million ($38.2 million), an increase of 6% compared with RUB 2,379 million in the prior year.

Payment Adjusted Net Revenue was RUB 1,836 million ($27.7 million), an increase of 5% compared with RUB 1,753 million in the prior year. Payment Adjusted Net Revenue growth was predominantly driven by an increase in payment volume across all verticals, especially the E-commerce and Money Remittances market verticals, that was in turn partially offset by the declining net revenue yields primarily as a result of the acquisition and consolidation of Contact and Rapida which operate on significantly lower net revenue yields than legacy QIWI business.

Other Adjusted Net Revenue, which is principally composed of revenue from inactivity fees, interest revenue and gain from currency swaps and overdrafts provided to agents, revenue from rent of space for kiosks and sale of kiosks, cash and settlement services and advertising, was RUB 693 million ($10.5 million), an increase of 11% compared with RUB 626 million in the prior year. The growth in the third-


quarter was mainly due to the increase in inactivity fees, interest revenue from deposits, gain from currency swaps and overdrafts provided to agents, slightly offset by our continuing investment in improving clients’ service, such as call center costs, decreasing revenue from rent of space of kiosks and cash and settlement services.

Adjusted EBITDA: For the quarter ended September 30, 2015, Adjusted EBITDA was RUB 1,340 million ($20.2 million), a decrease of 12% compared with RUB 1,520 million in the prior year. Adjusted EBITDA decline was mainly driven by 44% growth of SG&A cost including: bad debt expense, payroll, rent and office maintenance costs as well as professional fees resulting from the ongoing M&A activities. Adjusted EBITDA margin (Adjusted EBITDA as a percentage of Total Adjusted Net Revenue) was 53.0% compared with 63.9% in the prior year.

Adjusted Net Profit: For the quarter ended September 30, 2015, Adjusted Net Profit was RUB 1,133 million ($17.1 million), a decrease of 3% compared with RUB 1,163 million in the prior year. The decrease in Adjusted Net Profit was primarily driven by the same factors impacting Adjusted EBITDA, though significantly mitigated by operational ForEx gains.

Other Operating Data: For the quarter ended September 30, 2015, total payment volume was RUB 270.5 billion ($4.1 billion), an increase of 65% compared with RUB 164.4 billion in the prior year. Payment volume increased across all verticals driven largely by Contact and Rapida businesses as well as organic growth in E-commerce and Money Remittances market verticals. Average payment net revenue yield was 0.68%, a decrease of 39 bps compared with 1.07% in the prior period primarily due to the consolidation of lower yielding Contact and Rapida businesses.

The total average Net Revenue Yield was 0.93%, a decrease of 52 bps as compared with 1.45% in the prior year.

The number of active kiosks and terminals was 149,553, a decrease of 15% compared with the prior year, driven by the stricter regulation of the kiosk market by Central Bank of Russia. The number of active Visa Qiwi Wallet accounts was 16.7 million in the third quarter 2015, an increase of 0.2 million, or 1%, as compared with 16.5 million in the third quarter 2014.


Recent Developments

Dividend: QIWI continues to pursue different M&A opportunities and considers the timing and current market conditions to favor this strategy. We are focusing on business with a long-term growth potential in the areas complementary to our core business. Our current view is to refrain from paying dividends for the next few quarters.

Impact of Contact and Rapida: Starting June 1st 2015 we consolidate financial results of Contact and Rapida in our financial statements which are presented in the Annex below. Contact and Rapida have become a strong addition to the core business of QIWI contributing to Money Remittances, Financial Services and E-commerce market verticals as well as significantly increasing our share of the Russian money remittance market, broadening our merchant relationships and consumer base and strengthening our team. The integration is going in accordance with the plan.

Regulation by the Central Bank of Russia: Our kiosk network in Russia was affected by the enhanced controls that the Central Bank of Russia has implemented to ensure compliance by the agents with legislation that requires them to remit their proceeds to special accounts, as disclosed in our Form 6-K filed on November 2, 2015.

Although this decrease negatively affects the size of our physical distribution network in the short-term, we continue to believe that increased transparency in the kiosk market will ultimately allow us to improve our market share and strengthen our competitive advantages.

2015 Guidance1

QIWI reiterates its guidance in respect of 2015 outlook:

 

    Total Adjusted Net Revenue is expected to increase by 18% to 22% over 2014

 

    Adjusted Net Profit is expected to increase by 18% to 22% over 2014

The overall macroeconomic conditions continue to adversely affect the purchasing power of Russian population as high inflation combined with decreasing real wages put pressure on the disposable income. This in turn leads to the overall decrease in consumer spending and consequently our payment volumes, especially in Financial Services market vertical, which is impacted by several factors including lack of refinancing options for the consumers, and aforementioned decrease in real disposable income.

 

 

1  Guidance is provided in Russian rubles and includes consolidated financial result of Contact and Rapida since June 1st, 2015


Earnings Conference Call and Audio Webcast

QIWI will host a conference call to discuss third quarter 2015 financial results today at 8:30 a.m. ET. Hosting the call will be Sergey Solonin, chief executive officer, and Alexander Karavaev, chief financial officer. The conference call can be accessed live over the phone by dialing +1 (877) 407-3982 or for international callers by dialing +1 (201) 493-6780. A replay will be available at 11:30 a.m. ET and can be accessed by dialing +1 (877) 870-5176 or +1 (858) 384-5517 for international callers; the pin number is 13623376. The replay will be available until Tuesday, November 17, 2015. The call will be webcast live from the Company’s website at https://www.qiwi.ru under the Corporate Investor Relations section or directly at http://investor.qiwi.com/.


About QIWI plc.

QIWI is a leading provider of next generation payment services in Russia and the CIS. It has an integrated proprietary network that enables payment services across physical, online and mobile channels. It has deployed over 16.7 million virtual wallets, over 149,000 kiosks and terminals, and enabled merchants to accept over RUB 70 billion cash and electronic payments monthly from over 57 million consumers using its network at least once a month. QIWI’s consumers can use cash, stored value and other electronic payment methods to order and pay for goods and services across physical or online environments interchangeably.


Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of, and subject to the protection of, the Private Securities Litigation Reform Act of 1995, including, without limitation, expected total adjusted net revenue, adjusted net profit and net revenue yield, dividend payments, payment volume growth, and growth of physical and virtual distribution channels. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance or achievements of QIWI plc. to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. Various factors that could cause actual future results and other future events to differ materially from those estimated by management include, but are not limited to, the achievement of the expected benefits of the acquisition of Contact and Rapida, risks associated with the integration of Contact and Rapida, a decline in average net revenue yield, fees levied on QIWI’s consumers, regulation, QIWI’s ability to grow physical and virtual distribution channels, QIWI’s ability to expand geographically and other risks identified under the Caption “Risk Factors” in QIWI’s Annual Report on Form 20-F and in other reports QIWI files with the U.S. Securities and Exchange Commission. QIWI undertakes no obligation to revise any forward-looking statements or to report future events that may affect such forward-looking statements unless QIWI is required to do so by law.

Contact

 

Yakov Barinskiy

Head of M&A and Investor Relations

+7.499.709.0192

ir@qiwi.com

  

Varvara Kiseleva

Investor Relations

+7.499.709.0192

ir@qiwi.com


QIWI plc.

Consolidated Statement of Financial Position

(in thousands)

 

     As of
December 31,
2014
    As of
September 30,
2015
(unaudited)
     As of
September 30,
2015
(unaudited)
 
     RUB     RUB      USD(1)  

Assets

       

Non-current assets

       

Property and equipment

     379,943        390,136         5,890   

Goodwill and other intangible assets

     2,367,623        12,390,361         187,061   

Long-term debt instruments

     1,806,295        1,551,633         23,425   

Long-term loans

     52,648        28,223         426   

Other non-current assets

     42,455        53,615         809   

Deferred tax assets

     239,571        259,523         3,918   
  

 

 

   

 

 

    

 

 

 

Total non-current assets

     4,888,535        14,673,491         221,530   
  

 

 

   

 

 

    

 

 

 

Current assets

       

Trade and other receivables

     5,305,275        4,181,698         63,132   

Short-term loans

     31,588        51,060         771   

Short-term debt instruments

     2,132,887        1,331,207         20,098   

Prepaid income tax

     89,239        39,599         598   

VAT and other taxes receivable

     51,078        44,774         676   

Cash and cash equivalents

     17,079,965        15,168,809         229,008   

Other current assets

     345,688        704,792         10,640   
  

 

 

   

 

 

    

 

 

 

Total current assets

     25,035,720        21,521,939         324,923   
  

 

 

   

 

 

    

 

 

 

Assets of disposal group classified as held for sale

     125,867        —           —     
  

 

 

   

 

 

    

 

 

 

Total assets

     30,050,122        36,195,430         546,453   
  

 

 

   

 

 

    

 

 

 

Equity and liabilities

       

Equity attributable to equity holders of the parent

       

Share capital

     963        1,137         17   

Additional paid-in capital

     1,876,104        1,876,104         28,324   

Share premium

     3,044,303        12,068,267         182,198   

Other reserve

     764,243        814,171         12,292   

Retained earnings

     2,683,805        5,909,202         89,213   

Translation reserve

     204,337        318,548         4,809   
  

 

 

   

 

 

    

 

 

 

Total equity attributable to equity holders of the parent

     8,573,755        20,987,429         316,854   

Non-controlling interest

     (239,385     8,639         130   
  

 

 

   

 

 

    

 

 

 

Total equity

     8,334,370        20,996,068         316,984   
  

 

 

   

 

 

    

 

 

 

Non-current liabilities

       

Long-term borrowings

     41,981        —           —     

Other non-current liabilities

     9,381        3,597         54   

Deferred tax liabilities

     37,758        1,149,924         17,361   
  

 

 

   

 

 

    

 

 

 

Total non-current liabilities

     89,120        1,153,521         17,415   
  

 

 

   

 

 

    

 

 

 

Current liabilities

       

Short-term borrowings

     1,061        774,748         11,697   

Trade and other payables

     20,179,673        11,940,916         180,276   

Amounts due to customers and amounts due to banks

     1,001,286        965,225         14,572   

Income tax payable

     11,290        225,009         3,397   

VAT and other taxes payable

     127,733        108,473         1,638   

Deferred revenue

     52,008        10,869         164   

Other current liabilities

     56        20,601         311   
  

 

 

   

 

 

    

 

 

 

Total current liabilities

     21,373,107        14,045,841         212,054   
  

 

 

   

 

 

    

 

 

 

Liabilities directly associated with the assets of a disposal group classified as held for sale

     253,525        —           —     
  

 

 

   

 

 

    

 

 

 

Total equity and liabilities

     30,050,122        36,195,430         546,453   
  

 

 

   

 

 

    

 

 

 

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.


QIWI plc.

Consolidated Statement of Comprehensive Income

(in thousands, except per share data)

 

     Three months ended (unaudited)  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD(1)  

Revenue

     3,822,175        4,690,738        70,817   

Operating costs and expenses:

      

Cost of revenue (exclusive of depreciation and amortization)

     1,782,489        2,488,364        37,568   

Selling general and administrative expenses

     616,364        877,622        13,250   

Depreciation and amortization

     93,208        208,854        3,153   

Profit from operations

     1,330,114        1,115,898        16,847   
  

 

 

   

 

 

   

 

 

 

Other income

     4,861        7,089        107   

Other expenses

     (972     (241     (4

Foreign exchange gain

     885,133        1,667,372        25,173   

Foreign exchange loss

     (350,897     (586,323     (8,852

Share of loss of associates

     (12,151     —          —     

Impairment of investment in associates

     (21,731     —          —     

Interest income

     341        1,162        18   

Interest expense

     (9,351     (36,770     (555
  

 

 

   

 

 

   

 

 

 

Profit before tax

     1,825,347        2,168,187        32,734   

Income tax expense

     (269,134     (186,150     (2,810
  

 

 

   

 

 

   

 

 

 

Net profit

     1,556,213        1,982,037        29,923   
  

 

 

   

 

 

   

 

 

 

Attributable to:

      

Equity holders of the parent

     1,568,368        1,979,675        29,888   

Non-controlling interests

     (12,155     2,362        36   

Other comprehensive income

      

Exchange differences on translation of foreign operations

      

Differences arising during the year

     22,767        71,852        1,085   
  

 

 

   

 

 

   

 

 

 

Total comprehensive income net of tax

     1,578,980        2,053,889        31,008   
  

 

 

   

 

 

   

 

 

 

attributable to:

      

Equity holders of the parent

     1,610,673        2,050,632        30,959   

Non-controlling interests

     (31,693     3,257        49   

Earnings per share:

      

Basic profit attributable to ordinary equity holders of the parent

     28.81        32.79        0.50   

Diluted profit attributable to ordinary equity holders of the parent

     28.39        32.74        0.49   

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.


QIWI plc.

Consolidated Statement of Comprehensive Income

(in thousands, except per share data)

 

     Nine months ended (unaudited)  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD(1)  

Revenue

     10,570,075        12,859,147        194,138   

Operating costs and expenses:

      

Cost of revenue (exclusive of depreciation and amortization)

     5,217,187        6,174,610        93,220   

Selling general and administrative expenses

     1,827,016        2,322,855        35,069   

Depreciation and amortization

     258,085        467,584        7,059   

Profit from operations

     3,267,787        3,894,098        58,790   
  

 

 

   

 

 

   

 

 

 

Gain from disposal of subsidiaries

     —          32,595        492   

Other income

     40,900        14,971        226   

Other expenses

     (9,465     (10,950     (165

Foreign exchange gain

     928,038        1,800,970        27,190   

Foreign exchange loss

     (492,265     (914,824     (13,811

Share of loss of associates

     (23,270     —          —     

Impairment of investment in associates

     (24,634     —          —     

Interest income

     1,053        2,832        43   

Interest expense

     (30,362     (77,644     (1,172
  

 

 

   

 

 

   

 

 

 

Profit before tax

     3,657,782        4,742,048        71,592   

Income tax expense

     (697,556     (738,179     (11,145
  

 

 

   

 

 

   

 

 

 

Net profit

     2,960,226        4,003,869        60,448   
  

 

 

   

 

 

   

 

 

 

Attributable to:

      

Equity holders of the parent

     3,000,243        3,920,067        59,182   

Non-controlling interests

     (40,017     83,802        1,265   

Other comprehensive income

      

Exchange differences on translation of foreign operations

      

Differences arising during the year

     19,282        86,792        1,310   

Accumulated exchange differences reclassified to earnings upon disposal of foreign operations

     —          56,107        847   
  

 

 

   

 

 

   

 

 

 

Total comprehensive income net of tax

     2,979,508        4,146,768        62,605   
  

 

 

   

 

 

   

 

 

 

attributable to:

      

Equity holders of the parent

     3,040,801        4,034,278        60,907   

Non-controlling interests

     (61,293     112,490        1,698   

Earnings per share:

      

Basic profit attributable to ordinary equity holders of the parent

     56.58        68.84        1.04   

Diluted profit attributable to ordinary equity holders of the parent

     55.72        68.61        1.04   

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.


QIWI plc.

Consolidated Statement of Cash Flows

(in thousands)

 

     Nine months ended (unaudited)  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD(1)  

Cash flows from operating activities

      

Profit before tax

     3,657,782        4,742,048        71,592   
  

 

 

   

 

 

   

 

 

 

Adjustments to reconcile profit before income tax to net cash flow generated from operating activities

      

Depreciation and amortization

     258,085        467,584        7,059   

Foreign exchange gain, net

     (435,773     (886,146     (13,378

Interest income, net

     (252,476     (455,381     (6,875

Bad debt expense, net

     55,678        73,653        1,112   

Share of loss of associates

     23,270        —          —     

Impairment of investment in associates

     24,634        —          —     

Share-based payments

     335,491        61,863        934   

Gain from disposal of subsidiaries

     —          (32,595     (492

Gain from sale of investments

     —          (7,089     (107

Other

     11,565        (4,676     (71
  

 

 

   

 

 

   

 

 

 

Operating profit before changes in working capital

     3,678,256        3,959,261        59,774   
  

 

 

   

 

 

   

 

 

 

Decrease in trade and other receivables

     743,173        3,441,699        51,960   

(Increase)/decrease in other assets

     (178,808     134,183        2,026   

(Increase)/decrease in amounts due to customers and amounts due to banks

     256,071        (868,879     (13,118

Decrease in accounts payable and accruals

     (4,944,812     (12,219,147     (184,476

Loans issued/(settled) from banking operations

     (9,040     12,034        182   
  

 

 

   

 

 

   

 

 

 

Cash used in operations

     (455,160     (5,540,849     (83,652
  

 

 

   

 

 

   

 

 

 

Interest received

     273,811        545,340        8,233   

Interest paid

     (21,767     (83,590     (1,262

Income tax paid

     (630,533     (585,506     (8,840
  

 

 

   

 

 

   

 

 

 

Net cash flow used in operating activities

     (833,649     (5,664,605     (85,520
  

 

 

   

 

 

   

 

 

 

Cash flows used in investing activities

      

Cash acquired upon business combination

     —          3,200,275        48,316   

Contribution to associates without change in ownership

     (24,201     —          —     

Payment for assignment of loans

     (68,063     —          —     

Purchase of available-for-sale investments

     —          (5,628     (85

Proceeds from sale of investments

     —          7,557        114   

Purchase of property and equipment

     (230,784     (82,044     (1,239

Purchase of intangible assets

     (80,209     (191,835     (2,896

Net cash outflow on disposal of subsidiaries

     —          (16,206     (245

Loans issued

     (44,676     (43,653     (659

Repayment of loans issued

     39,440        —          —     

Purchase of debt instruments

     (706,846     (981,847     (14,823

Proceeds from settlement of debt instruments

     1,242,313        2,045,478        30,881   
  

 

 

   

 

 

   

 

 

 

Net cash flow generated from investing activities

     126,974        3,932,097        59,364   
  

 

 

   

 

 

   

 

 

 

Cash flows generated from financing activities

      

Issue of share capital

     3,044,356        —          —     

Exercise of options

     5,167        —          —     

Proceeds from borrowings

     38,198        55,045        831   

Repayment of borrowings

     (672     (484,692     (7,318

Dividends paid to owners of the Group

     (2,009,163     (698,912     (10,552

Dividends paid to non-controlling shareholders

     (2,170     —          —     

Transactions with non-controlling interest

     1,783        —          —     

Net cash flow generated from/(used in) financing activities

     1,077,499        (1,128,559     (17,038
  

 

 

   

 

 

   

 

 

 

Effect of exchange rate changes on cash and cash equivalents

     488,754        935,091        14,117   
  

 

 

   

 

 

   

 

 

 

Net decrease in cash and cash equivalents

     859,578        (1,925,976     (29,077
  

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at the beginning of the period

     11,636,913        17,094,785        258,085   
  

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at the end of the period

     12,496,491        15,168,809        229,008   
  

 

 

   

 

 

   

 

 

 

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.


Non-IFRS Financial Measures and Supplemental Financial Information

This release presents Total Adjusted Net Revenue, Payment Adjusted Net Revenue, Other Adjusted Net Revenue, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Profit and Adjusted Net Profit per share, which are non-IFRS financial measures. You should not consider these non-IFRS financial measures as substitutes for or superior to revenue, in the case of Total Adjusted Net Revenue, Payment Adjusted Net Revenue and Other Adjusted Net Revenue; Net Profit, in the case of Adjusted EBITDA; and Adjusted Net Profit, or earnings per share, in the case of Adjusted Net Profit per share, each prepared in accordance with IFRS. Furthermore, because these non-IFRS financial measures are not determined in accordance with IFRS, they are susceptible to varying calculations and may not be comparable to other similarly titled measures presented by other companies. QIWI encourages investors and others to review our financial information in its entirety and not rely on a single financial measure. For more information regarding Total Adjusted Net Revenue, Payment Adjusted Net Revenue, Other Adjusted Net Revenue, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Profit, and Adjusted Net Profit per share, including a quantitative reconciliation of Total Adjusted Net Revenue, Payment Adjusted Net Revenue, Other Adjusted Net Revenue, Adjusted EBITDA and Adjusted Net Profit to the most directly comparable IFRS financial performance measure, which is revenue in the case of Total Adjusted Net Revenue, payment revenue in the case of Payment Adjusted Net Revenue, other revenue in the case of Other Adjusted Net Revenue and net profit in the case of Adjusted EBITDA and Adjusted Net Profit, see Reconciliation of IFRS to Non-IFRS Operating Results in this earnings release.

Payment Adjusted Net Revenue is the Adjusted Net Revenue consisting of the merchant and consumer fees collected for the payment transactions. E-commerce payment adjusted net revenue consists of fees charged to customers and merchants that buy and sell products and services online, including online games, social networks, online stores, game developers, software producers, coupon websites, tickets and numerous other merchants. Financial Services payment adjusted net revenue primarily consists of fees charged for payments accepted on behalf of our bank partners and microfinance companies. Money Remittances payment adjusted net revenue primarily consists of fees charged for transferring funds via money remittance companies. Telecom payment adjusted net revenue primarily consists of fees charged for payments to MNOs, internet services providers and pay television providers. Other payment adjusted net revenue consists of consumer and merchant fees charged for a variety of payments including multi-level-marketing, utility bills, government payments, education services and many others. Other Adjusted Net Revenue is principally composed of revenue from inactivity fees, interest revenue and gain from currency swaps and overdrafts provided to agents, revenue from rent of space for kiosks and sale of kiosks, cash and settlement services and advertising.


QIWI plc.

Reconciliation of IFRS to Non-IFRS Operating Results

(in millions, except per share data)

 

     Three months ended (unaudited)  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD(1)  

Revenue

     3,822        4,691        70.8   

Minus: Cost of revenue (exclusive of depreciation and amortization)

     1,782        2,488        37.6   

Plus: Compensation to employees and related taxes

     339        326        4.9   
  

 

 

   

 

 

   

 

 

 

Total Adjusted Net Revenue

     2,379        2,529        38.2   
  

 

 

   

 

 

   

 

 

 

Payment Revenue(2)

     3,001        3,701        55.9   

Minus: Cost of payment revenue (exclusive of depreciation and amortization)(3)

     1,514        2,123        32.0   

Plus: Compensation to employees and related taxes allocated to payment revenue(4)

     266        258        3.9   
  

 

 

   

 

 

   

 

 

 

Payment Adjusted Net Revenue

     1,753        1,836        27.7   
  

 

 

   

 

 

   

 

 

 

Other Revenue(5)

     821        990        14.9   

Minus: Cost of other revenue (exclusive of depreciation and amortization)(6)

     268        366        5.5   

Plus: Compensation to employees and related taxes allocated to other revenue(4)

     73        69        1.0   
  

 

 

   

 

 

   

 

 

 

Other Adjusted Net Revenue

     626        693        10.5   
  

 

 

   

 

 

   

 

 

 

Payment Adjusted Net Revenue

     1,753        1,836        27.7   

E-commerce

     527        678        10.2   

Financial services

     601        233        3.5   

Money remittances

     240        546        8.3   

Telecom

     283        262        4.0   

Other

     103        117        1.8   

Other Adjusted Net Revenue

     626        693        10.5   
  

 

 

   

 

 

   

 

 

 

Total Adjusted Net Revenue

     2,379        2,529        38.2   
  

 

 

   

 

 

   

 

 

 

Net Profit

     1,556        1,982        29.9   
  

 

 

   

 

 

   

 

 

 

Plus:

      

Depreciation and amortization

     93        209        3.2   

Other income

     (0     (7     (0.1

Other expenses

     1        0        0.0   

Foreign exchange gain

     (885     (1,667     (25.2

Foreign exchange loss

     351        586        8.9   

Share of loss of associates

     12        —          —     

Impairment of investment in associates

     22        —          —     

Interest income

     (0     (1     (0.0

Interest expenses

     9        37        0.6   

Income tax expenses

     269        186        2.8   

Income from depositary(7)

     (5     —          —     

Share-based payments expenses

     96        15        0.2   
  

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

     1,520        1,340        20.2   
  

 

 

   

 

 

   

 

 

 

Adjusted EBITDA margin

     63.9     53.0     53.0

Net profit

     1,556        1,982        29.9   

Amortization of fair value adjustments(8)

     22        106        1.6   

Income from depositary

     (5     —          —     

Share-based payments expenses

     96        15        0.2   

Effect of taxation of the above items

     (5     (20     (0.3

Foreign Exchange gain on June 2014 offering proceeds(9)

     (502     (950     (14.3
  

 

 

   

 

 

   

 

 

 

Adjusted Net Profit

     1,163        1,133        17.1   
  

 

 

   

 

 

   

 

 

 

Adjusted Net Profit per share:

      

Basic

     21.37        18.77        0.28   

Diluted

     21.05        18.74        0.28   

Shares used in computing Adjusted Net Profit per share

      

Basic

     54,442        60,373        60,373   

Diluted

     55,248        60,467        60,467   


 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.
(2) Payment revenue primarily consists of the merchant and consumer fees charged for the payment transactions.
(3) Cost of payment revenue (exclusive of depreciation and amortization) primarily consists of transaction costs to acquire payments from our customers payable to agents, mobile operators, international payment systems and other parties.
(4) The Company does not record the compensation to employees and related taxes within cost of revenue separately for payment revenue and other revenue, therefore it has been allocated between payment revenue and other revenue in proportion to the relevant revenue amounts for the purposes of the reconciliation presented above.
(5) Other revenue is principally composed of revenue from inactivity fees, interest revenue and gain from currency swaps and overdrafts provided to agents, revenue from rent of space for kiosks and sale of kiosks, cash and settlement services and advertising.
(6) Cost of other revenue (exclusive of depreciation and amortization) primarily consists of direct costs associated with other revenue and other costs, including but not limited to: compensation to employees and related taxes allocated to other revenue, costs of call-centers and advertising commissions.
(7) Income from depositary is presented in the separate line in reconciliation tables for convenience purposes, while it is included in other income in financial statements.
(8) Amortization of fair value adjustments includes the effect of the acquisition of control in Contact and Rapida.
(9) Net effect of foreign exchange gains and losses on June 2014 SPO funds as presented in the reconciliation of Net Profit to Adjusted Net Profit differs from the Foreign exchange loss/(gain), net in the reconciliation of Net Profit to Adjusted EBITDA as the latter includes all the foreign exchange losses/(gains) for the period, while the former only include the foreign exchange gain on the SPO US dollar denominated funds.


QIWI plc.

Reconciliation of IFRS to Non-IFRS Operating Results

(in millions, except per share data)

 

     Nine months ended  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD(1)  

Revenue

     10,570        12,859        194.1   

Minus: Cost of revenue (exclusive of depreciation and amortization)

     5,217        6,175        93.2   

Plus: Compensation to employees and related taxes

     1,015        884        13.4   
  

 

 

   

 

 

   

 

 

 

Total Adjusted Net Revenue

     6,368        7,569        114.3   
  

 

 

   

 

 

   

 

 

 

Payment Revenue(2)

     8,433        9,945        150.1   

Minus: Cost of payment revenue (exclusive of depreciation and amortization)(3)

     4,566        5,077        76.7   

Plus: Compensation to employees and related taxes allocated to payment revenue(4)

     810        684        10.3   
  

 

 

   

 

 

   

 

 

 

Payment Adjusted Net Revenue

     4,677        5,551        83.8   
  

 

 

   

 

 

   

 

 

 

Other Revenue(5)

     2,137        2,915        44.0   

Minus: Cost of other revenue (exclusive of depreciation and amortization)(6)

     651        1,097        16.6   

Plus: Compensation to employees and related taxes allocated to other revenue(4)

     205        200        3.0   
  

 

 

   

 

 

   

 

 

 

Other Adjusted Net Revenue

     1,691        2,018        30.5   
  

 

 

   

 

 

   

 

 

 

Payment Adjusted Net Revenue

     4,677        5,551        83.8   

E-commerce

     1,358        2,089        31.5   

Financial services

     1,444        1,034        15.6   

Money remittances

     664        1,279        19.3   

Telecom

     905        768        11.6   

Other

     306        382        5.8   

Other Adjusted Net Revenue

     1,691        2,018        30.5   
  

 

 

   

 

 

   

 

 

 

Total Adjusted Net Revenue

     6,368        7,569        114.3   
  

 

 

   

 

 

   

 

 

 

Net Profit

     2,960        4,004        60.4   
  

 

 

   

 

 

   

 

 

 

Plus:

      

Depreciation and amortization

     258        468        7.1   

Other income

     (3     (15     (0.2

Other expenses

     9        11        0.2   

Foreign exchange gain

     (928     (1,801     (27.2

Foreign exchange loss

     492        915        13.8   

Share of loss of associates

     23        —          —     

Impairment of investment in associates

     25        —          —     

Interest income

     (1     (3     (0.0

Interest expenses

     30        78        1.2   

Income tax expenses

     698        738        11.1   

Offering expenses

     45        —          —     

Income from depositary(7)

     (38     —          —     

Share-based payments expenses

     335        62        0.9   

Gain from disposal of subsidiaries

     —          (33     (0.5
  

 

 

   

 

 

   

 

 

 

Adjusted EBITDA

     3,907        4,424        66.8   
  

 

 

   

 

 

   

 

 

 

Adjusted EBITDA margin

     61.3     58.4     58.4

Net profit

     2,960        4,004        60.4   

Amortization of fair value adjustments(8)

     57        167        2.5   

Offering expenses

     45        —          —     

Income from depositary

     (38     —          —     

Share-based payments expenses

     335        62        0.9   

Goodwill impairment

     —          —          —     

Effect of taxation of the above items

     (11     (32     (0.5

Gain from disposal of subsidiaries

     —          (33     (0.5

Foreign Exchange gain on June 2014 offering proceeds(9)

     (450     (885     (13.4
  

 

 

   

 

 

   

 

 

 

Adjusted Net Profit

     2,898        3,283        49.6   
  

 

 

   

 

 

   

 

 

 

Adjusted Net Profit per share:

      

Basic

     54.66        57.65        0.87   

Diluted

     53.83        57.46        0.87   

Shares used in computing Adjusted Net Profit per share

      

Basic

     53,023        56,943        56,943   

Diluted

     53,841        57,139        57,139   


 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.
(2) Payment revenue primarily consists of the merchant and consumer fees charged for the payment transactions.
(3) Cost of payment revenue (exclusive of depreciation and amortization) primarily consists of transaction costs to acquire payments from our customers payable to agents, mobile operators, international payment systems and other parties.
(4) The Company does not record the compensation to employees and related taxes within cost of revenue separately for payment revenue and other revenue, therefore it has been allocated between payment revenue and other revenue in proportion to the relevant revenue amounts for the purposes of the reconciliation presented above.
(5) Other revenue is principally composed of revenue from inactivity fees, interest revenue and gain from currency swaps and overdrafts provided to agents, revenue from rent of space for kiosks and sale of kiosks, cash and settlement services and advertising.
(6) Cost of other revenue (exclusive of depreciation and amortization) primarily consists of direct costs associated with other revenue and other costs, including but not limited to: compensation to employees and related taxes allocated to other revenue, costs of call-centers and advertising commissions.
(7) Income from depositary is presented in the separate line in reconciliation tables for convenience purposes, while it is included in other income in financial statements.
(8) Amortization of fair value adjustments includes the effect of the acquisition of control in Contact and Rapida.
(9) Net effect of foreign exchange gains and losses on June 2014 SPO funds as presented in the reconciliation of Net Profit to Adjusted Net Profit differs from the Foreign exchange loss/(gain), net in the reconciliation of Net Profit to Adjusted EBITDA as the latter includes all the foreign exchange losses/(gains) for the period, while the former only include the foreign exchange gain on the SPO US dollar denominated funds.


QIWI plc.

Other Operating Data

 

     Three months ended  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD (1)  

Payment volume (billion)(2)(3)

     164.4        270.5        4.1   
  

 

 

   

 

 

   

 

 

 

E-commerce

     18.8        34.0        0.5   

Financial services

     51.0        79.7        1.2   

Money remittances

     16.7        62.6        0.9   

Telecom

     64.8        68.7        1.0   

Other

     13.1        25.6        0.4   
  

 

 

   

 

 

   

 

 

 

Payment adjusted net revenue (million)(4)

     1,753.3        1,835.9        27.7   
  

 

 

   

 

 

   

 

 

 

E-commerce

     527.0        677.8        10.2   

Financial services

     600.5        233.1        3.5   

Money remittances

     239.8        546.5        8.3   

Telecom

     282.5        261.8        4.0   

Other

     103.4        116.8        1.8   
  

 

 

   

 

 

   

 

 

 

Payment average net revenue yield

     1.07     0.68     0.68
  

 

 

   

 

 

   

 

 

 

E-commerce

     2.80     2.00     2.00

Financial services

     1.18     0.29     0.29

Money remittances

     1.44     0.87     0.87

Telecom

     0.44     0.38     0.38

Other

     0.79     0.46     0.46
  

 

 

   

 

 

   

 

 

 

Total average Net Revenue Yield

     1.45     0.93     0.93

Active kiosks and terminals (units)(5)

     175,293        149,553        149,553   

Active Qiwi Wallet accounts(6)

     16.5        16.7        16.7   

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.
(2) Payment volume by market verticals and consolidated payment volume consist of the amounts paid by our customers to merchants included in each of those market verticals less intra-group eliminations. The methodology of payment volumes allocation between different market verticals in QIWI’s international operations (including Kazakhstan) may differ from the methodology used by QIWI’s Russian operations. We therefore retain the right to restate the presented volumes, net revenues and net revenue yields data in case the methodology of QIWI’s international operations will be brought in conformity with the methodology of QIWI’s Russian operations.
(3) Payment volume by market verticals and consolidated payment volume consist of the amounts paid by our customers to merchants included in each of those market verticals less intra-group eliminations. The methodology of payment volumes allocation between different market verticals in Contact and Rapida may differ from the methodology used by QIWI. We therefore retain the right to restate the presented volumes, net revenues and net revenue yields data in case the methodology of Contact and Rapida will be brought in conformity with the methodology used by QIWI.
(4) Payment Adjusted Net Revenue is calculated as the difference between Payment Gross Revenue and Payment Costs. Payment Gross Revenue primarily consists of merchant and consumer fees. Payment Costs primarily consist of commission to agents.
(5) We measure the numbers of our kiosks and terminals on a daily basis, with only those kiosks and terminals being taken into calculation through which at least one payment has been processed during the day, which we refer to as active kiosks and terminals. The period end numbers of our kiosks and terminals are calculated as an average of the amount of active kiosks and terminals for the last 30 days of the respective reporting period.
(6) Active Visa Qiwi Wallet accounts calculated on a yearly basis, i.e. an active account is an account that had at least one transaction within the last 12 months from the reporting date.


QIWI plc.

Other Operating Data

 

     Nine months ended  
     September 30, 2014     September 30, 2015     September 30, 2015  
     RUB     RUB     USD (1)  

Payment volume (billion)(2)(3)

     470.2        633.2        9.6   
  

 

 

   

 

 

   

 

 

 

E-commerce

     54.1        82.0        1.2   

Financial services

     146.6        168.7        2.5   

Money remittances

     45.1        116.8        1.8   

Telecom

     185.8        195.7        3.0   

Other

     38.6        70.1        1.1   
  

 

 

   

 

 

   

 

 

 

Payment adjusted net revenue (million)(4)

     4,677.2        5,551.4        83.8   
  

 

 

   

 

 

   

 

 

 

E-commerce

     1,357.6        2,089.0        31.5   

Financial services

     1,444.2        1,033.7        15.6   

Money remittances

     664.3        1,278.9        19.3   

Telecom

     905.1        768.2        11.6   

Other

     305.9        381.7        5.8   
  

 

 

   

 

 

   

 

 

 

Payment average net revenue yield

     0.99     0.88     0.88
  

 

 

   

 

 

   

 

 

 

E-commerce

     2.51     2.55     2.55

Financial services

     0.98     0.61     0.61

Money remittances

     1.47     1.10     1.10

Telecom

     0.49     0.39     0.39

Other

     0.79     0.54     0.54
  

 

 

   

 

 

   

 

 

 

Total average Net Revenue Yield

     1.35     1.20     1.20

Active kiosks and terminals (units)(5)

     175,293        149,553        149,553   

Active Qiwi Wallet accounts(6)

     16.5        16.7        16.7   

 

(1) Calculated using a ruble to U.S. dollar exchange rate of RUB 66.237 to U.S. $1.00, which the official exchange rate was quoted by the Central Bank of the Russian Federation as of September 30, 2015.
(2) Payment volume by market verticals and consolidated payment volume consist of the amounts paid by our customers to merchants included in each of those market verticals less intra-group eliminations. The methodology of payment volumes allocation between different market verticals in QIWI’s international operations (including Kazakhstan) may differ from the methodology used by QIWI’s Russian operations. We therefore retain the right to restate the presented volumes, net revenues and net revenue yields data in case the methodology of QIWI’s international operations will be brought in conformity with the methodology of QIWI’s Russian operations.
(3) Payment volume by market verticals and consolidated payment volume consist of the amounts paid by our customers to merchants included in each of those market verticals less intra-group eliminations. The methodology of payment volumes allocation between different market verticals in Contact and Rapida may differ from the methodology used by QIWI. We therefore retain the right to restate the presented volumes, net revenues and net revenue yields data in case the methodology of Contact and Rapida will be brought in conformity with the methodology used by QIWI.
(4) Payment Adjusted Net Revenue is calculated as the difference between Payment Gross Revenue and Payment Costs. Payment Gross Revenue primarily consists of merchant and consumer fees. Payment Costs primarily consist of commission to agents.
(5) We measure the numbers of our kiosks and terminals on a daily basis, with only those kiosks and terminals being taken into calculation through which at least one payment has been processed during the day, which we refer to as active kiosks and terminals. The period end numbers of our kiosks and terminals are calculated as an average of the amount of active kiosks and terminals for the last 30 days of the respective reporting period.
(6) Active Visa Qiwi Wallet accounts calculated on a yearly basis, i.e. an active account is an account that had at least one transaction within the last 12 months from the reporting date.