QIWI QIWI PLC

 

 

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 17, 2023

 

Commission File Number 001-35893

 

 

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 ¨

 

 

 

Exhibits

 

99.1	“QIWI Announces Third Quarter 2023 Financial Results” press release dated November 17, 2023

 

 

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 17, 2023	By:	/s/ Alexey Mashchenkov
		Chief Financial Officer

 

Exhibit 99.1

 

 

QIWI Announces Third Quarter 2023 Financial Results

 

NICOSIA, CYPRUS – November 17, 2023 – QIWI plc (NASDAQ and MOEX: QIWI) (“QIWI” or the “Company”), an innovative provider of cutting-edge payment and financial services, today announced its financial results for the third quarter ended September 30, 2023.

 

3Q 2023 key operating and financial highlights^{1 2}

 

				3Q 2022			3Q 2023						9M 2022			9M 2023						3Q 2023			9M 2023
				RUB million			RUB million			YoY			RUB million			RUB million			YoY			USD million(1)			USD million(1)
		Revenue		12,955			17,206			32.8	%		36,687			53,115			44.8	%		176.6			545.2
		Total Net Revenue		8,725			8,793			0.8	%		25,238			26,539			5.2	%		90.3			272.4
		Adjusted EBITDA		5,620			3,562			(36.6	)%		16,279			13,098			(19.5	)%		36.6			134.5
Consolidated Group results		Adjusted EBITDA margin		64.4	%		40.5	%		(23.9	)p.p.		64.5	%		49.4	%		(15.1	)p.p.		40.5	%		49.4	%
		Profit for the period		4,619			2,993			(35.2	)%		9,686			12,309			27.1	%		30.7			126.4
		Adjusted Net profit		4,690			3,564			(24.0	)%		9,980			12,978			30.0	%		36.6			133.2
		Adjusted Net profit margin		53.8	%		40.5	%		(13.2	)p.p.		39.5	%		48.9	%		9.4	p.p.		40.4	%		48.9	%
		Net Revenue		7,574			6,600			(12.9	)%		22,541			20,759			(7.9	)%		67.8			213.1
		Payment Net Revenue		6,029			4,062			(32.6	)%		17,728			14,192			(19.9	)%		41.7			145.7
		Payment Volume, billion		499			473			(5.1	)%		1,355			1,447			6.8	%		4.9			14.9
Payment Services (PS)		Payment Net Revenue Yield		1.21	%		0.86	%		(0.3	)p.p.		1.31	%		0.98	%		(0.3	)p.p.		0.86	%		0.98	%
		Other Net Revenue		1,545			2,538			64.3	%		4,813			6,567			36.5	%		26.1			67.4
		Adjusted Net profit		4,004			2,563			(36.0	)%		12,605			9,025			(28.4	)%		26.3			92.6
		Adjusted Net profit margin		52.9	%		38.8	%		(14.0	)p.p.		55.9	%		43.5	%		(12.4	)p.p.		38.8	%		43.5	%
		Net Revenue		181			1,166			542.8	%		466			2,837			509.2	%		12.0			29.1
Digital Marketing (DM)		Adjusted Net (loss) / profit		63			272			331.6	%		36			601			1550.2	%		2.8			6.2
		Adjusted Net profit margin		34.8	%		23.3	%		(11.4	)p.p.		7.8	%		21.2	%		13.4	p.p.		23.3	%		21.2	%
Corporate and Other (CO)		Net Revenue		970			1,027			5.8	%		2,231			2,943			31.9	%		10.5			30.2
		Adjusted Net (loss) / profit		623			729			17.0	%		(2,662	)		3,352			(225.9	)%		7.5			34.4

 

	(1)	Throughout this release dollar translation is calculated using a rouble to U.S. dollar exchange rate of RUB 97.4147 to U.S. $1.00, which was the official exchange rate quoted by the Central Bank of the Russian Federation as of September 30, 2023.
	(2)	Throughout this release, following the introduction of new Digital Marketing segment, certain amounts related to Flocktory have been reclassified from Corporate and Other to Digital Marketing segment to conform to the current period presentation.

 

Key events during and after the reported period

 

	·	QIWI provided an update on corporate restructuring and received the consent from the NASDAQ Hearing Panel (the “Panel”) to sustain listing on NASDAQ until completion of the restructuring by January 31, 20243.
	·	QIWI released its ESG Report for 20224.
	·	From July 26, 2023, certain QIWI Bank operations were temporarily restricted by the Central Bank of Russia5.
	·	Credit rating agency Expert Ra assigned credit rating ruBBB+ with “developing” outlook for JSC QIWI, updated its rating for QIWI Bank (JSC), rating of QIWI PLC expired and its extension was not requested by the Company6.

 

¹ Total Net Revenue, adjusted EBITDA, adjusted EBITDA margin, adjusted Net profit, and adjusted Net profit margin in this release are “non-IFRS financial measures”. Please see the section “Non-IFRS Financial Measures and Supplemental Financial Information” for more details as well as a reconciliation to IFRS reported numbers at the end of this release.

² Throughout this release calculations of totals, subtotals and/or percentage change may have small variations due to rounding of decimals.

³ https://investor.qiwi.com/news-and-events/press-releases/4108577/

⁴ https://investor.qiwi.com/news-and-events/press-releases/4108576/

⁵ https://investor.qiwi.com/news-and-events/press-releases/4108571/

⁶ https://investor.qiwi.com/news-and-events/press-releases/4108572/

 

 

3Q 2023 results

 

Net Revenue breakdown by segments

 

		3Q 2022				3Q 2023								9M 2022				9M 2023								3Q 2023				9M 2023
		RUB million				RUB million				YoY				RUB million				RUB million				YoY				USD million				USD million
Total Net Revenue			8,725				8,793				0.8	%			25,238				26,539				5.2	%			90.3				272.4
Payment Services (PS)			7,574				6,600				(12.9	)%			22,541				20,759				(7.9	)%			67.8				213.1
PS Payment			6,029				4,062				(32.6	)%			17,728				14,192				(19.9	)%			41.7				145.7
PS Other			1,545				2,538				64.3	%			4,813				6,567				36.5	%			26.1				67.4
Digital Marketing (DM)			181				1,166				542.8	%			466				2,837				509.2	%			12.0				29.1
Corporate and Other (CO)			970				1,027				5.8	%			2,231				2,943				31.9	%			10.5				30.2

 

Total Net Revenue slightly increased by 0.8% YoY and amounted to RUB 8,793 million ($90.3 million) despite the high base effect of last year and temporary restrictions of the Central Bank of Russia (the “CBR restrictions”) on certain operations for QIWI Wallets⁷. The decline in the PS segment was offset mainly by the strong results of the Digital Marketing (DM) segment and the contribution from the Corporate and Other (CO) segment.

 

Payment Services

 

PS Net Revenue decreased by 12.9% YoY to RUB 6,600 million ($67.8 million) mainly driven by the negative implications of the CBR restrictions and the decreased level of money remittances which were lower than the temporary hikes of the previous year.

 

PS Payment Net Revenue decline was 32.6% YoY and amounted to RUB 4,062 million ($41.7 million) driven by a combination of lower PS Payment Volume by 5.1% YoY and PS Payment Net Revenue Yield decline by 35 bps YoY to 0.86%.

 

PS Payment Net Revenue Yield decline was driven by the adverse mix effect resulting from a higher share of operations with lower margins, such for example acquiring.

 

PS Payment Volume decreased by 5.1% YoY to RUB 473.5 billion due to the negative implications of the CBR restrictions and decreased level of CONTACT money remittances which were partially offset by the onboarding of new merchants and aggregators and the growing payment volume from our product offering for digital entertainment and commerce.

 

PS Other Net Revenue primarily comprises interest income, revenue from fees for inactive accounts and unclaimed payments, cash and settlement services and related conversion income, income from financing of other business segments and third parties. In 3Q 2023 PS Other Net Revenue increased by 64.3% YoY to RUB 2,538 million ($26.1 million) as a result of further growth of net revenue derived from cash and settlement services and higher interest income resulting from a larger investment portfolio and higher interest rates.

 

Digital Marketing (DM)

 

DM Net Revenue increased by 542.8% YoY to RUB 1,166 million ($12.0 million) driven by the RealWeb acquisition in December 2022⁸ and the strong performance of Flocktory underpinned by the increase in the number of clients and traffic-providers as well as overall improved business efficiency.

 

Corporate and Other (CO)

 

		3Q 2022				3Q 2023								9M 2022				9M 2023								3Q 2023				9M 2023
		RUB million				RUB million				YoY				RUB million				RUB million				YoY				USD million				USD million
CO Net Revenue			970				1,027				5.8	%			2,231				2,943				31.9	%			10.5				30.2
ROWI			696				655				(6.0	)%			1,775				1,908				7.5	%			6.7				19.6
Tochka			-				-								106				-				(100.0	)%			-				-
Corporate and Other projects			273				371				35.8	%			351				1,035				194.7	%			3.8				10.6

 

⁷ https://investor.qiwi.com/news-and-events/press-releases/4108571/

⁸ https://investor.qiwi.com/news-and-events/press-releases/4108557/

 

 

CO Net Revenue increased by 5.8% YoY to RUB 1,027 million ($10.5 million) driven by higher interest income accounted for in Corporate and Other projects.

 

·

ROWI Net Revenue decreased by 6.0% YoY to RUB 655 million ($6.7 million) mainly due to a decline of net portfolio yield compared to 3Q2022.

 

o

As of September 30, 2023, the bank guarantees portfolio reached RUB 79.0 billion - an increase of 11.2% YoY.

 

o

As of September 30, 2023, the factoring portfolio was RUB 13.7 billion or 24.0% higher YoY.

 

o

As of September 30, 2023, the portfolio of online loans for government contracts execution doubled compared to the previous year and reached RUB 3.7 billion.

 

o

In 3Q 2023, the share of ROWI Net Revenue in Total Net Revenue was 7.4%.

 

·

Corporate and Other projects Net Revenue in 3Q 2023 amounted to RUB 371 million ($3.8 million) compared to RUB 273 million in 3Q 2022 driven by higher interest income from investments in debt securities (high-quality corporate and government bonds) partially offset by lower income from provided loans.

 

Operating expenses and other non-operating income and expenses

 

		3Q 2022			3Q 2023						9M 2022			9M 2023						3Q 2023			9M 2023
		RUB million			RUB million			YoY			RUB million			RUB million			YoY			USD million			USD million
Operating expenses		(3,363	)		(5,583	)		66.0	%		(9,876	)		(14,417	)		46.0	%		(57.3	)		(148.0	)
% of Net Revenue		(38.5	)%		(63.5	)%		(24.9	)p.p.		(39.1	)%		(54.3	)%		(15.2	)p.p.
Selling, general and administrative expenses		(959	)		(1,542	)		60.8	%		(2,503	)		(3,685	)		47.2	%		(15.8	)		(37.8	)
% of Net Revenue		(11.0	)%		(17.5	)%		(6.5	)p.p.		(9.9	)%		(13.9	)%		(4.0	)p.p.
Personnel expenses		(1,987	)		(3,084	)		55.2	%		(5,662	)		(8,869	)		56.6	%		(31.7	)		(91.0	)
% of Net Revenue		(22.8	)%		(35.1	)%		(12.3	)p.p.		(22.4	)%		(33.4	)%		(11.0	)p.p.
Depreciation, amortization & impairment		(258	)		(352	)		36.4	%		(858	)		(976	)		13.8	%		(3.6	)		(10.0	)
% of Net Revenue		(3.0	)%		(4.0	)%		(1.0	)p.p.		(3.4	)%		(3.7	)%		(0.3	)p.p.
Credit loss (expense) / income		(159	)		(605	)		280.5	%		(853	)		(887	)		4.0	%		(6.2	)		(9.1	)
% of Net Revenue		(1.8	)%		(6.9	)%		(5.1	)p.p.		(3.4	)%		(3.3	)%		0.04	p.p.
Other non-operating income and expenses		582			983			68.9	%		(2,117	)		3,232			(252.7	)%		10.1			33.2
% of Net Revenue		6.7	%		11.2	%		4.5	p.p.		(8.4	)%		12.2	%		20.6	p.p.
Share of loss of an associate		-			(68	)					-			(112	)					(0.7	)		(1.1	)
% of Net Revenue		0.0	%		(0.8	)%		(0.8	)p.p.		0.0	%		(0.4	)%		(0.4	)p.p.
Foreign exchange gain/(loss), net		555			1,055			90.1	%		(2,255	)		3,170			(240.6	)%		10.8			32.5
% of Net Revenue		6.4	%		12.0	%		5.6	p.p.		(8.9	)%		11.9	%		20.9	p.p.
Other income and expenses, net		27			13			(51.9	)%		138			(233	)		(268.8	)%		0.1			(2.4	)
% of Net Revenue		0.3	%		0.1	%		(0.2	)p.p.		0.5	%		(0.9	)%		(1.4	)p.p.
Gain/(loss) from disposal of subsidiaries		-			(17	)					-			407						(0.2	)		4.2
% of Net Revenue		0.0	%		(0.2	)%		(0.2	)p.p.		0.0	%		1.5	%		1.5	p.p.

 

Operating expenses increased by 66.0% YoY to RUB 5,583 million ($57.3 million) primarily due to investments in personnel and operational improvements to secure future growth of the business and the consolidation of RealWeb results starting from the beginning of the year. As a result, operating expenses as a percentage of Total Net Revenue deteriorated by 24.9 ppts and amounted to 63.5%.

 

Personnel expenses surged by 55.2% YoY to RUB 3,084 million ($31.7 million) driven by the hiring of new staff for the development of new and existing products, salary reviews and higher bonuses to employees in PS segment as well as the consolidation of the new RealWeb business. Personnel expenses as a percentage of Total Net Revenue increased by 12.3 ppts to 35.1% driven by the factors described above.

 

Selling, general and administrative expenses increased by 60.8% YoY to RUB 1,542 million ($15.8 million) and as a percentage of Total Net Revenue by 6.5 ppt YoY to 17.5% as a result of a combination of (i) higher expenses as a result of further growth of net revenue derived from cash and settlement services, (ii) consolidation of RealWeb results starting from 2023, (iii) and higher expenses on advisory and audit services, IT-related services, business travel and other.

 

 

Depreciation, amortization and impairment increased by 36.4% YoY to RUB 352 million ($3.6 million) or 4.0% as percent of Total Net Revenue due to the consolidation of RealWeb and expenditures on automation of payment systems.

 

Credit loss amounted to RUB 605 million ($6.2 million) compared to RUB 159 million in 3Q 2022 due to the increase of provisions for the bank guarantees portfolio.

 

Other non-operating income increased by 68.9% YoY to RUB 983 million ($10.1 million) due to the higher amount of foreign exchange gain.

 

Income tax expense

 

Income tax expense decreased by 9.4% YoY to RUB 1,200 million ($12.3 million) driven by lower profit before tax on higher expenses described above.

 

The effective tax rate increased from 22.3% in 3Q 2022 to 28.6% in 3Q 2023 due to the windfall tax⁹ accrued in 3Q 2023 in the amount of RUB 450 million.

 

Profitability results

 

		3Q 2022				3Q 2023								9M 2022				9M 2023								3Q 2023				9M 2023
		RUB million				RUB million				YoY				RUB million				RUB million				YoY				USD million				USD million
Adjusted EBITDA			5,620				3,562				(36.6	)%			16,279				13,098				(19.5	)%			36.6				134.5
Adjusted EBITDA margin, %			64.4	%			40.5	%			(23.9	)p.p.			64.5	%			49.4	%			(15.1	)p.p.			40.5	%			49.4	%
Adjusted Net Profit			4,690				3,564				(24.0	)%			9,980				12,978				30.0	%			36.6				133.2
Adjusted Net Profit margin, %			53.8	%			40.5	%			(13.2	)p.p.			39.5	%			48.9	%			9.4	p.p.			40.5	%			48.9	%
Payment Services			4,004				2,563				(36.0	)%			12,605				9,025				(28.4	)%			26.3				92.6
PS Adjusted Net Profit margin, %			52.9	%			38.8	%			(14.0	)p.p.			55.9	%			43.5	%			(12.4	)p.p.			38.8	%			43.5	%
Digital Marketing (DM)			63				272				331.6	%			36				601				1550.2	%			2.8				6.2
DM Adjusted Net Profit margin, %			34.8	%			23.3	%			(11.4	)p.p.			7.8	%			21.2	%			13.4	p.p.			23.3	%			21.2	%
Corporate and Other (CO)			623				729				17.0	%			(2,662	)			3,352				(225.9	)%			7.5				34.4

 

Adjusted EBITDA decreased by 36.6% YoY to RUB 3,562 million ($36.6 million) mainly due to investments in personnel and operational improvements to secure future growth of the business and the consolidation of RealWeb starting from the beginning of the year. As a result, Adjusted EBITDA margin decreased by 23.9 ppts YoY to 40.5%.

 

Adjusted Net Profit decreased by 24.0% YoY to RUB 3,564 million ($36.6 million). Adjusted Net Profit margin decreased by 13.2 ppts YoY to 40.5% driven by EBITDA dynamics partially offset by higher forex exchange gain and excluded the one-off impact of the windfall tax provision.

 

PS Adjusted Net Profit decreased by 36.0% YoY to RUB 2,563 million ($26.3 million) mainly due to (i) the decline of PS Net Revenue by 12.9% YoY described earlier, and (ii) investments made in personnel and operational improvements to secure future growth of the business. As a result, PS Adjusted Net Profit margin deteriorated by 14.0 ppts to 38.8%.

 

Digital Marketing (DM) Adjusted Net Profit for 3Q 2023 increased to RUB 272 million ($2.8 million) due to the Flocktory Net Revenue growth and the consolidation of new RealWeb business. DM Adjusted Net Profit margin was 23.3%.

 

CO Adjusted Net Profit increased by 17.0% YoY to RUB 729 million ($7.5 million) resulting from a combination of CO Net Revenue YoY growth by 5.8% mentioned previously and the foreign exchange gain.

 

⁹ Windfall tax is a one-off special tax enacted in Federal Law 414-FZ and set to take effect on January 1, 2024. The Group anticipates using the “early payment” option to reduce the effective rate by up to 50%.

 

 

Dividends

 

Due to the lingering stock market infrastructure issues, the Company does not see the opportunity to arrange the distribution of dividends or repurchase shares with the equal treatment of all existing shareholders. Therefore, the Board decided to keep the distribution of dividends under review until changes of the sanction regime or other developments enable the Company to distribute dividends to all of its shareholders.

 

Earnings Conference Call and Audio Webcast

 

Given the persisting level of uncertainty and market volatility, there will be no conference call or webcast to discuss the results. We welcome all our stakeholders to send any questions related to our business using the contact details available on our investor’s website. We remain available for individual incoming call requests.

 

About QIWI plc.

 

QIWI is an innovative provider of cutting-edge payment and financial services. We stand at the forefront of fintech innovations to facilitate and secure the digitalization of payments. Our mission is to connect our clients providing unique financial and technological solutions to make the impossible accessible and simple. We offer a wide range of products under several directions: QIWI payment and financial services ecosystem for merchants and B2C clients across digital use-cases, ROWI digital structured financial products for SME, digital marketing, and several other projects.

 

For the FY 2022 QIWI had revenue of RUB 51.5 billion and an Adjusted EBITDA of RUB 19.8 billion. QIWI's American depositary shares are listed on the NASDAQ and Moscow Exchange (ticker: QIWI).

 

For more information, visit investor.qiwi.com.

 

Contact

Investor Relations

+357.25028091

ir@qiwi.com

 

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, statements regarding expected total net revenue, adjusted net profit and net revenue yield, dividend payments, payment volume growth, growth of physical and virtual distribution channels, trends in each of our market verticals and statements regarding the development of our ROWI, RealWeb, Flocktory and other projects, the impact of recent sanctions targeting Russia, the impact of such sanctions on our results of operations, potential further changes in the regulatory regime, the effect of the CBR restrictions on results of operations, any other restriction the CBR may impose based on our past and future operations, our ability to  eliminate partially or completely the CBR restrictions, and others. Such forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance or achievements of QIWI 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 macroeconomic conditions of the Russian Federation and in each of the international markets in which we operate, growth in each of our markets, competition, the introduction of new products and services and their acceptance by consumers, QIWI’s ability to estimate the market risk and capital risk associated with new projects, a decline in net revenue yield, regulation, QIWI’s ability to grow physical and virtual distribution channels, cyberattacks and security vulnerabilities in QIWI’s products and services, QIWI’s ability to expand geographically, the risk that new projects will not perform in accordance with its expectations 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.

 

 

QIWI plc.

Consolidated Statement of Financial Position

(in millions)

 

		As of December 31,				As of September 30,				As of September 30,
		2022				2023				2023
						(Unaudited)				(Unaudited)
		RUB				RUB				USD
Assets
Non-current assets
Property and equipment			1,163				1,658				17.0
Goodwill and other intangible assets			13,126				12,968				133.1
Investments in associates			303				512				5.3
Long-term debt securities			2,946				4,993				51.3
Long-term loans issued			843				3,479				35.7
Other non-current assets			257				200				2.1
Deferred tax assets			208				288				3.0
Total non-current assets			18,846				24,098				247.4
Current assets
Trade and other receivables			15,194				14,948				153.4
Short-term loans issued			14,200				18,556				190.5
Short-term debt securities			14,029				29,899				306.9
Other current assets			2,195				1,877				19.3
Cash and cash equivalents			47,462				29,463				302.4
Total current assets			93,080				94,743				972.6
Total assets			111,926				118,841				1,219.9
Equity and liabilities
Equity attributable to equity holders of the parent
Share capital			1				1				0.01
Additional paid-in capital			1,876				1,876				19.3
Share premium			12,068				12,068				123.9
Other reserves			2,696				1,141				11.7
Retained earnings			39,941				51,799				531.7
Translation reserve			401				268				2.8
Total equity attributable to equity holders of the parent			56,983				67,153				689.4
Non-controlling interests			912				1,068				11.0
Total equity			57,895				68,221				700.3
Non-current liabilities
Long-term deferred income			1,154				849				8.7
Long-term lease liabilities			133				319				3.3
Other non-current liabilities			156				113				1.2
Deferred tax liabilities			1,847				1,440				14.8
Total non-current liabilities			3,290				2,721				27.9
Current liabilities
Trade and other payables			33,048				29,382				301.6
Customer accounts and amounts due to banks			11,203				12,374				127.0
Short-term debt			3,922				3,855				39.6
Short-term lease liabilities			300				228				2.3
Other current liabilities			2,268				2,060				21.1
Total current liabilities			50,741				47,899				491.7
Total equity and liabilities			111,926				118,841				1,219.9

 

 

QIWI plc.

Consolidated Statement of Comprehensive Income

(in millions, except per share data)

 

		Three months ended (unaudited)
		September 30, 2022				September 30, 2023				September 30, 2023
		RUB				RUB				USD
Revenue:			12,955				17,206				176.6
Revenue from contracts with customers			10,871				14,587				149.7
Interest revenue calculated using the effective interest rate			1,697				2,215				22.7
Fees from inactive accounts and unclaimed payments			387				404				4.1
Operating costs and expenses:			(7,593	)			(13,996	)			(143.7	)
Cost of revenue (exclusive of items shown separately below)			(4,230	)			(8,413	)			(86.4	)
Selling, general and administrative expenses			(959	)			(1,542	)			(15.8	)
Personnel expenses			(1,987	)			(3,084	)			(31.7	)
Depreciation and amortization			(258	)			(352	)			(3.6	)
Credit loss (expense)/income			(159	)			(605	)			(6.2	)
Profit from operations			5,362				3,210				33.0
Loss from disposal of subsidiaries			-				(17	)			(0.2	)
Share of loss of an associate			-				(68	)			(0.7	)
Foreign exchange gain/(loss), net			555				1,055				10.8
Other income and expenses, net			27				13				0.1
Profit before tax			5,944				4,193				43.0
Income tax expense			(1,325	)			(1,200	)			(12.3	)
Net profit for the period			4,619				2,993				30.7
Attributable to:
Equity holders of the parent			4,463				2,864				29.4
Non-controlling interests			156				129				1.3
Other comprehensive (loss)/income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Foreign currency translation:
Exchange differences on translation of foreign operations			(177	)			136				1.4
Net gain recycled to profit or loss upon disposal			-				(23	)			(0.2	)
Debt securities at fair value through other comprehensive income (FVOCI):
Net gain/(loss) arising during the period, net of tax			(121	)			(1,206	)			(12.4	)
Net gain recycled to profit or loss upon disposal			-				(7	)			(0.1	)
Share of other comprehensive Income of an associate			-				2				0.0
Total other comprehensive (loss)/income, net of tax			(298	)			(1,098	)			(11.3	)
Total comprehensive income, net of tax			4,321				1,895				19.5
Attributable to:
Equity holders of the parent			4,160				1,752				18.0
Non-controlling interests			161				143				1.5
Earnings per share:
Basic, earnings attributable to ordinary equity holders of the parent			71.17				45.67				0.47
Diluted, earnings attributable to ordinary equity holders of the parent			71.17				45.67				0.47

 

 

QIWI plc.

Consolidated Statement of Comprehensive Income

(in millions, except per share data)

 

		Nine months ended (unaudited)
		September 30, 2022				September 30, 2023				September 30, 2023
		RUB				RUB				USD
Revenue:			36,687				53,115				545.2
Revenue from contracts with customers			30,331				45,960				471.8
Interest revenue calculated using the effective interest rate			5,078				5,923				60.8
Fees from inactive accounts and unclaimed payments			1,278				1,232				12.6
Operating costs and expenses:			(21,325	)			(40,993	)			(420.8	)
Cost of revenue (exclusive of items shown separately below)			(11,449	)			(26,576	)			(272.8	)
Selling, general and administrative expenses			(2,503	)			(3,685	)			(37.8	)
Personnel expenses			(5,662	)			(8,869	)			(91.0	)
Depreciation and amortization			(822	)			(976	)			(10.0	)
Credit loss (expense)/income			(853	)			(887	)			(9.1	)
Impairment of non-current assets			(36	)			-				-
Profit from operations			15,362				12,122				124.4
Gain from disposal of subsidiaries			-				407				4.2
Share of loss of an associate			-				(112	)			(1.1	)
Foreign exchange gain/(loss), net			(2,255	)			3,170				32.5
Other income and expenses, net			138				(233	)			(2.4	)
Profit before tax			13,245				15,354				157.6
Income tax expense			(3,559	)			(3,045	)			(31.3	)
Net profit for the period			9,686				12,309				126.4
Attributable to:
Equity holders of the parent			9,262				11,858				121.7
Non-controlling interests			424				451				4.6
Other comprehensive (loss)/income
Other comprehensive income to be reclassified to profit or loss in subsequent periods:
Foreign currency translation:
Exchange differences on translation of foreign operations			(101	)			349				3.6
Net gain recycled to profit or loss upon disposal			-				(447	)			(4.6	)
Debt securities at fair value through other comprehensive income (FVOCI):
Net gain/(loss) arising during the period, net of tax			(11	)			(1,270	)			(13.0	)
Net gain recycled to profit or loss upon disposal			-				(25	)			(0.3	)
Share of other comprehensive Income of an associate			-				5				0.1
Total other comprehensive (loss)/income, net of tax			(112	)			(1,388	)			(14.2	)
Total comprehensive income, net of tax			9,574				10,921				112.1
Attributable to:
Equity holders of the parent			9,166				10,435				107.1
Non-controlling interests			408				486				5.0
Earnings per share:
Basic, earnings attributable to ordinary equity holders of the parent			147.98				189.08				1.94
Diluted, earnings attributable to ordinary equity holders of the parent			147.98				189.08				1.94

 

 

QIWI plc.

Consolidated Statement of Cash Flows

(in millions)

 

		Nine months ended (unaudited)
		September 30, 2022				September 30, 2023				September 30, 2023
		RUB				RUB				USD(1)
Operating activities
Profit before tax			13,245				15,354				157.6
Adjustments to reconcile profit before tax to net cash flows generated from operating activities:
Depreciation and amortization			822				976				10.0
Foreign exchange loss/(gain), net			2,255				(3,170	)			(32.5	)
Interest income, net			(4,787	)			(5,668	)			(58.2	)
Credit loss expense			853				887				9.1
Share of loss of an associate			-				112				1.1
Gain from disposal of subsidiaries			-				(407	)			(4.2	)
Impairment of non-current assets			36				-				-
Other			83				269				2.8
Net cash flow generated from operating activities before changes in working capital			12,507				8,353				85.7
Changes in operating assets and liabilities:
Decrease/(Increase) in trade and other receivables			(3,592	)			(431	)			(4.4	)
Decrease in other assets			103				648				6.7
Increase in customer accounts and amounts due to banks			4,832				328				3.4
Decrease in accounts payable and accruals			(5,354	)			(5,140	)			(52.8	)
(Decrease)/Increase in other liabilities			409				(457	)			(4.7	)
Increase in loans issued as operating activity			(2,561	)			(4,169	)			(42.8	)
Cash generated from operations			6,344				(868	)			(8.9	)
Interest received			5,480				6,949				71.3
Interest paid			(399	)			(295	)			(3.0	)
Income tax paid			(2,840	)			(3,149	)			(32.3	)
Net cash flow generated from operating activities			8,585				2,637				27.1
Investing activities
Cash used in business combinations			(304	)			(47	)			(0.5	)
Cash disposal upon sale of subsidiaries			-				(186	)			(1.9	)
Cash paid for investments in associates			(660	)			(315	)			(3.2	)
Proceeds from sale of an associate			4,855				-				-
Purchase of property and equipment			(173	)			(536	)			(5.5	)
Purchase of intangible assets			(147	)			(209	)			(2.1	)
Proceeds from sale of fixed and intangible assets			9				28				0.3
Loans issued			(7	)			(3,179	)			(32.6	)
Repayment of loans issued			34				61				0.6
Purchase of debt securities			(4,509	)			(22,455	)			(230.5	)
Proceeds from sale and redemption of debt securities			2,391				3,394				34.8
Net cash flow generated from investing activities			1,489				(23,444	)			(240.7	)
Financing activities
Repayment of debt			(717	)			(310	)			(3.2	)
Proceeds from borrowings			-				249				2.6
Payment of principal portion of lease liabilities			(216	)			(268	)			(2.8	)
Dividends paid to non-controlling shareholders			(124	)			(260	)			(2.7	)
Transactions with non-controlling interest			-				(304	)			(3.1	)
Net cash flow used in financing activities			(1,057	)			(893	)			(9.2	)
Effect of exchange rate changes on cash and cash equivalents			(1,611	)			3,710				38.1
Effect of change in ECL on cash and cash equivalents			-				(9	)			(0.1	)
Net increase/(decrease) in cash and cash equivalents			7,406				(17,999	)			(184.8	)
Cash and cash equivalents at the beginning of the period			33,033				47,462				487.2
Cash and cash equivalents at the end of the period			40,439				29,463				302.4

 

 

Non-IFRS Financial Measures and Supplemental Financial Information

 

This release presents Total Net Revenue, Payment Services (PS) Net Revenue, PS Payment Net Revenue, PS Other Net Revenue, Digital Marketing (DM) Net Revenue, Corporate and Other (CO) Net Revenue, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Profit, PS Adjusted Net Profit, DM Adjusted Net Profit, CO 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 Net Revenue, PS Net Revenue, PS Payment Net Revenue, PS Other Net Revenue, DM Net Revenue, CO Net Revenue; Net Profit, in the case of Adjusted EBITDA, Adjusted Net Profit, PS Adjusted Net Profit, DM Adjusted Net Profit, CO Adjusted Net Profit, and 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 Net Revenue, PS Net Revenue, PS Payment Net Revenue, PS Other Net Revenue, DM Net Revenue, CO Net Revenue, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Profit and Adjusted Net Profit per share, including a quantitative reconciliation of Total Net Revenue and its breakdown by segments, Adjusted EBITDA and Adjusted Net Profit to the most directly comparable IFRS financial performance measures, which is revenue in the case of Total Net Revenue, PS Payment Net Revenue and PS Other 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.

 

We define non-IFRS financial measures as follows:

 

	·	“Total Net Revenue” is calculated by subtracting cost of revenue from revenue.
	·	“Adjusted EBITDA” as Net profit plus/(less): (1) depreciation and amortization, (2) other expenses/(income), (3) foreign exchange loss/(gain), (4) share of loss/(gain) of associates and joint ventures, (5) interest expenses/ (income), (6) income tax expenses, (7) share-based payment expenses, (8) impairment of non-current assets, (9) loss/(gain) from disposal of subsidiary.
	·	“Adjusted Net profit” as Net profit plus/(less): (1) fair value adjustments recorded on business combinations and their amortization, (2) impairment of non-current assets, (3) share-based payment expenses, (4) loss/(gain) from disposal of subsidiary, (5) windfall tax, and (6) effect of taxation of the above items.
	·	“Adjusted EBITDA Margin” as Adjusted EBITDA divided by Total Net Revenue.
	·	“Adjusted Net profit Margin” as Adjusted Net profit divided by Total Net Revenue.

 

Total Net Revenue is a key measure used by management to observe our operational profitability since it reflects our portion of the revenue net of fees that we pass through, primarily to our agents and other reload channels providers. In addition, under IFRS, most types of fees are presented on a gross basis whereas certain types of fees are presented on a net basis. Therefore, in order to analyze our two sources of payment processing fees on a comparative basis, management reviews Total Net Revenue.

 

We provide a breakdown of Total Net Revenue by segments - PS Net Revenue, including PS Payment Net Revenue and PS Other Net Revenue, DM Net Revenue, CO Net Revenue. We define the above measures as follows:

 

	·	PS Payment Net Revenue is the Net Revenue comprising the merchant and consumer fees collected for the payment transactions.
	·	PS Other Net Revenue primarily comprises revenue from fees for inactive accounts and unclaimed payments, interest revenue, cash and settlement services and related conversion income, income from financing of other business segments and third parties.
	·	DM Net Revenue includes revenue generated with services provided for context and media advertising management services, including platform services under subscription, social network presence, programmatic, CPA and mobile marketing type of services. The segment includes results of full-cycle digital marketing service provider RealWeb and Flocktory services in marketing automation and advertising technologies.
	·	CO Net Revenue comprises from results of ROWI business, Tochka project (before 2Q2022) and Corporate and Other projects, including interest income.

 

 

Adjusted EBITDA is a key measure used by management as a supplemental performance measure that facilitates operating performance comparisons from period to period and company to company by backing out potential differences caused by variations in capital structures (affecting interest expenses, net), changes in foreign exchange rates that impact financial assets and liabilities denominated in currencies other than our functional currency (affecting foreign exchange (loss)/gain, net), tax positions (such as the impact on periods or companies of changes in effective tax rates), the age and book depreciation of fixed assets (affecting relative depreciation expense), non-cash charges (affecting share-based payments expenses and impairment of non-current assets), and certain one-time income and expenses (affecting other income, offering and related expenses, etc.). Adjusted EBITDA also excludes other expenses, share in losses of associates and impairment of investment in associates because we believe it is helpful to view the performance of our business excluding the impact of entities that we do not control, and because our share of the net income (loss) of associates and other expenses includes items that have been excluded from Adjusted EBITDA (such as finance expenses, net, income tax, and depreciation and amortization). Because Adjusted EBITDA facilitates internal comparisons of operating performance on a more consistent basis, we also use Adjusted EBITDA in measuring our performance relative to that of our competitors.

 

Adjusted Net Profit is a key measure used by management to observe the operational profitability of the company. We believe Adjusted Net Profit is useful to an investor in evaluating our operating performance because it measures a company’s operating performance without the effect of non-recurring items or items that are not core to our operations. For example, loss on disposals of subsidiaries, windfall tax and the effects of deferred taxation on excluded items do not represent the core operations of the business, and fair value adjustments recorded on business combinations and their amortization, impairment of non-current assets and share-based payments expenses do not have a substantial cash effect. Nevertheless, such gains and losses can affect our financial performance.

 

In order to reflect the operational profitability of each segment, we provide a following breakdown of Adjusted Net Profit: Payment Services Adjusted Net Profit, Digital Marketing Adjusted Net Profit, Corporate and Other Adjusted Net Profit.

 

Payment Services segment payment volume provides a measure of the overall size and growth of the business, and increasing our payment volumes is essential to growing our profitability.

 

Payment Services segment net revenue yield. We calculate Payment Services segment net revenue yield by dividing Payment Services segment net revenue by Payment Services segment payment volume. Payment Services segment net revenue yield provides a measure of our ability to generate net revenue per unit of volume we process.

 

 

QIWI plc.

Reconciliation of IFRS to Non-IFRS Operating Results

(in millions, except per share data)

 

		Three months ended (unaudited)
		September 30, 2022				September 30, 2023				September 30, 2023
		RUB				RUB				USD
Revenue			12,955				17,206				176.6
Minus: Cost of revenue			4,230				8,413				86.4
Total Net Revenue			8,725				8,793				90.3
Segment Net Revenue
Payment Services Segment Revenue			11,435				10,537				108.2
PS Payment Revenue(1)			9,663				7,749				79.5
Minus: Cost of PS Payment Revenue (2)			3,634				3,687				37.8
PS Payment Net Revenue			6,029				4,062				41.7
PS Other Revenue(3)			1,772				2,788				28.6
Minus: Cost of PS Other Revenue (4)			227				250				2.6
PS Other Net Revenue			1,545				2,538				26.1
Payment Services Segment Net Revenue			7,574				6,600				67.8
Digital Marketing Revenue			252				5,358				55.0
Minus: Cost of DM revenue			71				4,193				43.0
Digital Marketing Net Revenue			181				1,166				12.0
Corporate and Other Category Revenue			1,268				1,311				13.5
Minus: Cost of CO Revenue			298				284				2.9
Corporate and Other Category Net Revenue			970				1,027				10.5
Total Segment Net Revenue			8,725				8,793				90.3
Net profit			4,619				2,993				30.7
Plus:
Depreciation and amortization			258				352				3.6
Other income and expenses, net			(27	)			(13	)			(0.1	)
Foreign exchange (gain)/loss, net			(555	)			(1,055	)			(10.8	)
Loss from disposal of subsidiaries			-				17				0.2
Share of gain/(loss) of an associate			-				68				0.7
Income tax expenses			1,325				1,200				12.3
Adjusted EBITDA			5,620				3,562				36.6
Adjusted EBITDA margin			64.4	%			40.5	%			40.5	%
Net profit			4,619				2,993				30.7
Fair value adjustments recorded on business combinations and their amortization(5)			85				124				1.3
Loss from disposal of subsidiaries			-				17				0.2
Windfall tax and effect from taxation of the above items			(14	)			430				4.4
Adjusted Net Profit			4,690				3,564				36.6
Adjusted Net Profit per share:
Basic			74.79				56.83				0.58
Diluted			74.79				56.83				0.58
Weighted-average number of shares used in computing Adjusted Net Profit per share:
Basic			62,713				62,713				62,713
Diluted			62,713				62,713				62,713

 

 

 

	(1)	PS Payment Revenue represents payment processing fees, which primarily consists of the merchant and consumer fees charged for the payment transactions.
	(2)	Cost of PS Payment Revenue primarily consists of transaction costs to acquire payments from our customers payable to agents, mobile operators, international payment systems and other parties.
	(3)	PS Other Revenue primarily consists of revenue from fees for inactive accounts and unclaimed payments, interest revenue, cash and settlement services and related conversion income, fees for intercompany and third-party funding, and advertising fees.
	(4)	Cost of PS Other Revenue primarily consists of direct costs associated with other revenue and other costs, including but not limited to: interest expenses related to issued bonds, costs of sms notification, advertising commissions.
	(5)	Amortization of fair value adjustments primarily includes the effect of the acquisition of control in CONTACT, Rapida and RealWeb.

 

 

QIWI plc.

Reconciliation of IFRS to Non-IFRS Operating Results

(in millions, except per share data)

 

		Nine months ended (unaudited)
		September 30, 2022				September 30, 2023				September 30, 2023
		RUB				RUB				USD
Revenue			36,687				53,115				545.2
Minus: Cost of revenue			11,449				26,576				272.8
Total Net Revenue			25,238				26,539				272.4
Segment Net Revenue
Payment Services Segment Revenue			33,019				32,426				332.9
PS Payment Revenue(1)			27,450				25,184				258.5
Minus: Cost of PS Payment Revenue (2)			9,722				10,992				112.8
PS Payment Net Revenue			17,728				14,192				145.7
PS Other Revenue(3)			5,569				7,242				74.3
Minus: Cost of PS Other Revenue (4)			756				674				6.9
PS Other Net Revenue			4,813				6,567				67.4
Payment Services Segment Net Revenue			22,541				20,759				213.1
Digital Marketing Revenue			640				16,880				173.3
Minus: Cost of DM revenue			175				14,044				144.2
Digital Marketing Net Revenue			466				2,837				29.1
Corporate and Other Category Revenue			3,028				3,808				39.1
Minus: Cost of CO Revenue			796				865				8.9
Corporate and Other Category Net Revenue			2,231				2,943				30.2
Total Segment Net Revenue			25,238				26,539				272.4
Profit for the period			9,686				12,309				126.4
Plus:
Depreciation and amortization			822				976				10.0
Other income and expenses, net			(138	)			233				2.4
Foreign exchange (gain)/loss, net			2,255				(3,170	)			(32.5	)
Gain from disposal of subsidiaries			-				(407	)			(4.2	)
Share of gain of an associate and a joint venture			-				112				1.1
Income tax expenses			3,559				3,045				31.3
Share-based payment expenses			59				-				-
Impairment of non-current assets			36				-				-
Adjusted EBITDA			16,279				13,098				134.5
Adjusted EBITDA margin			64.5	%			49.4	%			49.4	%
Profit for the period			9,686				12,309				126.4
Fair value adjustments recorded on business combinations and their amortization(5)			266				687				7.1
Impairment of non-current assets			36				-				-
Share-based payment expenses			59				-				-
Gain from disposal of subsidiaries			-				(407	)			(4.2	)
Windfall tax and effect from taxation of the above items			(67	)			389				4.0
Adjusted Net Profit			9,980				12,978				133.2
Adjusted Net Profit per share:
Basic			159.45				206.94				2.12
Diluted			159.45				206.94				2.12
Weighted-average number of shares used in computing Adjusted Net Profit per share:
Basic			62,588				62,713				62,713
Diluted			62,588				62,713				62,713

 

(1)	PS Payment Revenue represents payment processing fees, which primarily consists of the merchant and consumer fees charged for the payment transactions.
(2)	Cost of PS Payment Revenue primarily consists of transaction costs to acquire payments from our customers payable to agents, mobile operators, international payment systems and other parties.
(3)	PS Other Revenue primarily consists of revenue from fees for inactive accounts and unclaimed payments, interest revenue, cash and settlement services and related conversion income, fees for intercompany and third-party funding, and advertising fees.
(4)	Cost of PS Other Revenue primarily consists of direct costs associated with other revenue and other costs, including but not limited to: interest expenses related to issued bonds, costs of sms notification, advertising commissions.
(5)	Amortization of fair value adjustments primarily includes the effect of the acquisition of control in CONTACT, Rapida and RealWeb.

 

 

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