ADR ЦианCIAN299,00
What about Russian depositary receipts
In 2022, investors saw two collapses of depositary receipts. (ARD and GDR). The first happened at the end of April amid rising infrastructure risks.: paper owners were afraid, that shares in the future may "hang" after the refusal of Western stock exchanges to cooperate with Russia.
The second collapse occurred quite recently - in early June, after the publication of the sixth package of EU sanctions, in which the National Settlement Depository got (NSD). Investors are worried about it again., that trading in Russian GDRs may be partially blocked, because NSD is their ultimate holder.
The main blow from EU sanctions for Russian investors is: dividend and coupon payments on Russian receipts they will not be able to receive, if companies pass them through the European financial system. But these restrictions are already informally in effect from March 2022..
Sales structure of the company
"Cyan" earns thanks to its own online service for the sale and rental of real estate, where users post ads. For convenience, I divided the company's business into four areas.:
- Key segment – ad revenue, lead generation and display advertising.
- Mortgage – cooperation with banks. Cyan advertises mortgage products, and in return receives a commission for placing ads and attracting new customers.
- Valuation and analytics – research of the Russian real estate market and provision of information for a fee.
- Comprehensive solutions – fees from online real estate transactions.
IN 1 in the quarter of 2022, "Cyan" managed to avoid problems, which the entire industry has faced. The company's revenue in the first three months increased by 38% — to RUB 1.726 billion — due to increased demand for services and strong indicators of the key segment.
Results of the "Cyana" segments, billion rubles
| 1к2021 | 1к2022 | The change | |
|---|---|---|---|
| Key segment | 1,191 | 1,622 | 36% |
| Mortgage direction | 0,045 | 0,069 | 53% |
| Evaluation and analytics | 0,012 | 0,014 | 17% |
| Complete Solutions | 0 | 0,021 | — |
| total revenues | 1,248 | 1,726 | 38% |
Additional division of revenues of the key segment "Cyana", billion rubles
| 1к2021 | 1к2022 | The change | |
|---|---|---|---|
| Placement of ads | 0,754 | 0,998 | 32% |
| Lead generation | 0,300 | 0,473 | 58% |
| Media advertising | 0,134 | 0,146 | 9% |
| Total | 1,191 | 1,622 | 36% |
Key financial and operating results
Taking into account the significant decrease in traffic to "Cyan" in 1 in the quarter of 2022, it was possible to improve its financial results and earn a net profit for the first time, which amounted to 0.044 billion rubles, — against a loss of 0.383 billion rubles last year.
A similar trend was observed in adjusted EBITDA.: the company managed to bring the indicator to the positive zone, improving the result from −0.068 to 0.056 billion rubles due to the strong results of the key segment in Moscow and the Moscow region.
The main negative point in the report should be considered the average monthly decrease in traffic, for three reasons: high base 2021, raising the key rate to 20% in 1 quarter of 2022 and a strong increase in prices for Russian real estate over the past year.
Key financial results of the company, billion dollars
| 1к2021 | 1к2022 | The change | |
|---|---|---|---|
| Revenue | 1,248 | 1,726 | 38% |
| Adjusted EBITDA | −0,068 | 0,056 | — |
| EBITDA margin | −5% | 3% | 8 P. P. |
| Net profit | −0,383 | 0,044 | — |
| Average monthly traffic, million users | 21,2 | 19,2 | −9% |
| net debt | −0,268 | −2,578 | — |
Russian real estate market
IN 1 In the quarter, the Russian real estate market faced a decrease in demand and the redistribution of buyers from the secondary market to the primary market, as a result, "Cyan" recorded a drop in traffic on 9%.
However, in 2 halfway through 2022, traffic could recover, as prices have gone down for the first time since the pre-pandemic 2019. In April 2022, the average cost of secondary housing in Russia decreased by 0,5%, and some market participants predict a further drop in prices.
Also, do not forget, that the Central Bank of the Russian Federation at the last meeting reduced the key rate to 9,5%. This will lead to a decrease in interest rates on mortgages and will have a positive impact on the real estate market in general and on the business of Cyan in particular., because it will help to return traffic to the pre-crisis level.
Comparison with developers and fast-growing Russian business
| EV / EBITDA | P / E | P / S | net debt / EBITDA | |
|---|---|---|---|---|
| "Cyan" | 40,33 | Otric. | 3,13 | −5,83 |
| HeadHunter | 4,96 | 6,62 | 2,54 | 0,31 |
| "Group Positive" | 17,99 | 23,64 | 6,92 | 0,19 |
| PEAK | 3,63 | 2,66 | 0,85 | 1,59 |
| LSR | 3,30 | 3,03 | 0,38 | 1,92 |
| "Airplane" | 8,44 | 16,81 | 1,52 | 2,32 |
What's the bottom line?
Thanks to the successes in Moscow and the Moscow region, the financial results in the first quarter of 2022 for Cyan were not bad. Revenue increased by 38%, and net profit for the first time was in the positive zone. If not for EU sanctions, online platform quotes, probably, would rewrite their highs, but shareholders are watching with bitterness the fall in capitalization by 70%.
Investing now in Cyan shares is a big risk, despite the low price. In the meantime, it is better to wait for the lifting of European sanctions from the Russian National Settlement Depository.
