Q3 2021 IFRS results

Mail.ru Group Limited

Interim Condensed

Consolidated Financial Statements

For the three and nine months ended September 30, 2021

Contents
Report on Review of Interim Financial Information..................................................................................................................................................	3
Interim Condensed Consolidated Financial Statements
Interim Condensed Consolidated Statement of Financial Position....................................................................................................................	4
Interim Condensed Consolidated Statement of Comprehensive Income.......................................................................................................	5
Interim Condensed Consolidated Statement of Cash Flows...............................................................................................................................	6
Interim Condensed Consolidated Statement of Changes in Equity ..................................................................................................................	7
Notes to the Interim Condensed Consolidated Financial Statements
1	Corporate information and description of business..................................................................................................................................	9
2	Basis of preparation ............................................................................................................................................................................................	9
3	Changes in accounting policies and disclosures........................................................................................................................................	9
4	Seasonality of operations..................................................................................................................................................................................	9
5	Operating segments .........................................................................................................................................................................................	10
6	Business combinations.....................................................................................................................................................................................	14
7	Goodwill and other intangible assets...........................................................................................................................................................	17
8	Property and equipment..................................................................................................................................................................................	18
9	Investments in equity accounted associates and joint ventures.........................................................................................................	18
10	Assets held for sale ...........................................................................................................................................................................................	19
11	Other payables, accrued expenses and contingent consideration liabilities...................................................................................	19
12	Revenue................................................................................................................................................................................................................	19
13	Income tax...........................................................................................................................................................................................................	20
14	Commitments, contingencies and operating risks...................................................................................................................................	21
15	Balances and transactions with related parties........................................................................................................................................	23
16	Financial instruments........................................................................................................................................................................................	24
17	Events after the reporting date ....................................................................................................................................................................	28

VK Interim Results 2021

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Interim Condensed Consolidated Statement of Financial Position

As of September 30, 2021

(in millions of Russian Roubles)

		As of
		September 30,	As of
		2021	December 31,
	Notes	(unaudited)	2020
ASSETS
Non-current assets
Investments in equity accounted associates and joint ventures	9	48,045	41,948
Goodwill		138,003	135,670
Right-of-use assets		15,330	15,618
Other intangible assets	7	19,160	19,623
Property and equipment	8	15,511	11,651
Financial assets at fair value through profit or loss	16	5,382	2,305
Deferred income tax assets		4,407	2,924
Long-term loans issued	16	1,298	422
Advance under office lease contracts		460	249
Total non-current assets		247,596	230,410
Current assets
Trade accounts receivable	16	16,251	16,707
Prepaid income tax		340	358
Prepaid expenses and advances to suppliers		1,807	853
Loans issued	16	623	2,441
Inventories		148	98
Other current assets		1,826	1,247
Cash and cash equivalents	16	30,820	39,297
Total current assets		51,815	61,001
Total assets		299,411	291,411
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Issued capital		-	-
Share premium		77,920	77,101
Treasury shares		(1,044)	(1,071)
Retained earnings		94,929	103,103
Foreign currency translation reserve		873	1,195
Total equity attributable to equity holders of the parent		172,678	180,328
Non-controlling interests		407	1,663
Total equity		173,085	181,991
Non-current liabilities
Deferred income tax liabilities		1,509	1,379
Deferred revenue		2,076	1,871
Non-current lease liabilities	16	12,358	11,338
Non-current financial liabilities at fair value through profit or loss	16	1,622	3,506
Long-terminterest-bearing loans and bonds	16	51,369	41,497
Other non-current liabilities		265	265
Total non-current liabilities		69,199	59,856
Current liabilities
Trade accounts payable	16	12,947	10,923
Income tax payable		2,450	2,673
VAT and other taxes payable		3,422	2,259
Deferred revenue and customer advances		18,766	16,912
Short-term portion of long-terminterest-bearing loans	16	7,060	3,718
Current lease liabilities	16	3,436	3,861
Other payables, accrued expenses and contingent consideration liabilities	11	9,046	9,218
Total current liabilities		57,127	49,564
Total liabilities		126,326	109,420
Total equity and liabilities		299,411	291,411

VK Interim Results 2021

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Interim Condensed Consolidated Statement of Comprehensive Income

For the three and nine months ended September 30, 2021 (in millions of Russian Roubles)

		Three months ended September 30,	Nine months ended September 30,
		2021	2020	2021	2020
	Notes	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Online advertising		12,229	9,543	33,950	26,230
MMO games		8,888	8,514	27,649	23,527
Community IVAS		4,425	4,109	13,316	13,086
Education technology services	3.2	2,173	934	5,924	2,097
Other revenue		2,326	1,417	6,625	4,286
Total revenue	5, 12	30,041	24,517	87,464	69,226
Personnel expenses		(7,589)	(6,515)	(23,762)	(18,653)
Agent/partner fees		(7,970)	(7,002)	(24,430)	(19,549)
Marketing expenses		(4,653)	(4,709)	(15,827)	(13,093)
Server hosting expenses		(225)	(202)	(635)	(567)
Professional services		(321)	(238)	(1,050)	(637)
Other operating expenses		(1,195)	(939)	(3,038)	(2,782)
Total operating expenses		(21,953)	(19,605)	(68,742)	(55,281)
EBITDA		8,088	4,912	18,722	13,945
Depreciation and amortisation		(4,562)	(3,578)	(13,405)	(10,526)
Share of loss of equity accounted associates and joint ventures	9	(5,451)	(4,986)	(14,181)	(10,327)
Finance income		340	76	716	280
Finance expenses		(993)	(627)	(2,910)	(1,868)
Other non-operating income/(loss)		47	(15)	25	23
Goodwill impairment	7	-	-	-	(6,430)
Net gain on financial assets and liabilities at fair value through
profit or loss	16	698	3,939	2,023	3,525
Impairment of equity accounted associates		-	-	-	(260)
Gain on remeasurement of previously held interest in equity
accounted associate		305	-	305	46
Loss on remeasurement of financial instruments		(116)	(53)	(414)	(230)
Net foreign exchange (loss)/gain		(205)	331	7	425
Loss before income tax expense		(1,849)	(1)	(9,112)	(11,397)
Income tax expense	13	(505)	(261)	(676)	(754)
Net loss		(2,354)	(262)	(9,788)	(12,151)
Attributable to:
Equity holders of the parent		(2,096)	(141)	(9,424)	(11,886)
Non-controlling interest		(258)	(121)	(364)	(265)
Other comprehensive loss that may be reclassified to profit or
loss in subsequent periods
Exchange differences on translation of foreign operations:
Differences arising during the period		202	244	(322)	128
Total other comprehensive income/(loss), net of tax effect of 0		202	244	(322)	128
Total comprehensive loss, net of tax		(2,152)	(18)	(10,110)	(12,023)
Attributable to:
Equity holders of the parent		(1,894)	103	(9,746)	(11,758)
Non-controlling interest		(258)	(121)	(364)	(265)
Loss per share, in RUB:
Basic loss per share attributable to ordinary equity holders of
the parent		(9)	(1)	(42)	(55)
Diluted loss per share attributable to ordinary equity holders
of the parent		n/a	n/a	n/a	n/a

VK Interim Results 2021

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