CIAN (CIAN US: U/R) reported its 4Q21 IFRS numbers. The top-line growth dynamics remained solid at 42% y/y in Q4 (vs. 44% y/y in Q3), which resulted in a 52% y/y expansion for the whole of 2021, thus, surpassing the company’s guidance of 45-48% y/y. The healthy revenue dynamics were backed by improving monetization metrics of key products – listings and leads to developers. Core business profitability in Moscow and the region remains healthy at 58%, while in other regions the company is narrowing its losses. At the same time, innovative services expectedly remained in the heavy investment phase. The company expectedly provided no guidance for 2022. Amid macroeconomic turbulence, our main focus is on Cian’s performance against the broad Russian real estate deal origination market. With RUB2.4bn in C&CE and no debt as of the end of 2021, we believe the company demonstrates a certain safety margin and potential for market share gains.
The total number of listings of 1.78mn showed an expected normalization from the 2.14mn in 4Q20 (and a 6% drop from Q3) due to a temporary decrease in the numbers of properties listed in the market following a period of active demand stimulated by the Russian government measures, as well as the re-launch of monetization in certain regions throughout 2021. We note a continuous positive price trend for average daily revenue per listing (all geographies), which added 65% y/y and 16% q/q (to RUB5.5). This includes a 28% y/y expansion in Moscow & the region (to RUB26.2/day) and 160% y/y (to RUB2.5/day) in other regions (+15% and +19% from Q3, respectively).
4Q revenue increased 42% y/y to RUB1.77bn. Core Business revenue in Moscow & the region advanced 22% y/y, revenue in other regions grew 88% in Q4 (decelerating from 27-100% y/y growth in Q3) on the effect of the monetization re-launch. The total number of monetized regions remained unchanged q/q at 21. Mortgage marketplace revenue expanded 2.2x from 4Q20 and 44% q/q. Overall, adjacent services generated RUB164mn in revenue (2.6x y/y, 1.9x q/q). As a result, 2021 revenue grew 52% y/y to RUB6bn, surpassing 45-48% y/y growth guided by the company in November.
CIAN generated RUB116mn in adj. EBITDA in Q4 (6.5% margin, down 3.2ppt q/q), which is 22-23% lower y/y and q/q. The Core Business EBITDA margin was 24.4% in Q4, a 1.3pp improvement from Q3. The margin was healthy at 59% in Moscow & the region (62% was posted in 4Q20 and 59% in Q3). Other regions generated RUB270mn of EBITDA loss (-59% margin) marking improving economics from Q3 (-70% margin). Adjacent services' cash burn (-RUB277mn EBITDA) was deeper than in Q3.
On a full year basis, the top-line expanded by 52% y/y to RUB6.0bn. Adj. EBITDA was RUB318mn implying a 5.3% margin (+0.7pp y/y). The Core Business EBITDA margin was reported at 20.2% compared to 13.9% in 2020. The q/q movements in the balance sheet and cash flow show that in Q4 CIAN repaid RUB450mn in short-term debt (the company had no outstanding interest-bearing debt as of 31 December, lease liabilities amounted to RUB91mn) and fulfilled employee share-based payments liability amounted to RUB764mn. The company had RUB2.42bn in C&CE by the end of the year.
Figure 1. Cian financial results
Source: Company data