• Revenue of $93.7 million, growth accelerating to 119% year-over-year; exceeding the top end of Opera’s guidance range

  • Monthly active users averaging 232 million for smartphone (up 18% YoY) and 68 million for PC (up 16% YoY)

  • Opera News users grew 39% to over 169 million monthly active users year-over-year; dedicated news app increased to 41 million monthly active users

  • Opera’s microlending business more than tripled revenue versus the second quarter; driven by 5M loans totaling more than $250 million in total loan value

  • OList, our recently launched classifieds offering, reached 1 million listings within three months of launch

  • Net income of $28.1 million, supported by a non-cash OPay valuation gain

  • Adjusted EBITDA of $12.6 million, representing significant margin expansion versus the prior quarter

  • Raising 2019 revenue guidance range to $300 to $310 million, representing 77% growth at the midpoint versus 2018

OSLO, Norway, Nov. 14, 2019 (GLOBE NEWSWIRE) -- Opera Limited (NASDAQ: OPRA), one of the world’s major browser developers and a leading internet consumer brand, today announced its unaudited consolidated financial results for the quarter ended September 30, 2019.

 
Third quarter 2019 financial highlights
 
  Three Months Ended September 30,  Year-over-  Nine Months Ended September 30,  Year-over- 
[US$ thousands, except for margins and per ADS amounts] 2018  2019  year %
change 
  2018  2019  year %
change 
 
Revenue  42,795   93,678   118.9%  122,069   205,245   68.1%
                         
Net income (loss)  9,717   28,120   189.4%  23,747   35,923   51.3%
Margin  22.7%  30.0%      19.5%  17.5%    
                         
Adjusted EBITDA (1)  16,495   12,647   -23.3%  48,283   25,305   -47.6%
Margin  38.5%  13.5%      39.6%  12.3%    
                         
Adjusted net income (1)  12,494   30,578   144.7%  33,151   43,188   30.3%
Margin  29.2%  32.6%      27.2%  21.0%    
                         
Diluted net income per ADS, US$  0.09   0.25   176.6%  0.23   0.32   36.6%
                         
Diluted adjusted net income per ADS, US$ (1)  0.11   0.27   146.1%  0.33   0.38   16.4%

(1) Please see the separate section "About non-IFRS financial measures" for the definitions of adjusted EBITDA and adjusted net income.

Frode Jacobsen, Opera’s CFO, said, “We are pleased with our third quarter results delivering accelerated revenue growth year-over-year and positive momentum throughout the business. We are successfully leveraging our well-known brand and large user base of more than 350 million monthly active users to drive growth in new opportunities beyond the browser, including news and content, fintech and classifieds. Our new initiatives, strategic investments and the continued growth of our browser, led to an accelerating growth trajectory with 119% year-over-year revenue growth.

“Our third quarter revenue growth was driven by strong results in both advertising and search revenues and more than a tripling of microlending revenue versus the second quarter, driven by rapid scaling in India and continued success in Kenya. Adjusted EBITDA margins expanded meaningfully versus the prior quarter, while we continued to invest aggressively in existing and future growth initiatives.”

Third quarter 2019 user base and product highlights
(All comparisons are relative to the third quarter of 2018 unless otherwise stated)

  • Opera News average Monthly Active Users (“MAUs”) grew 39% to 169 million

  • The Opera News app, launched in January 2018, reached 41 million average MAUs, up 136% on year-over-year basis

  • Total smartphone average MAUs grew 18% to 232 million

  • PC average MAUs grew 16% to 68 million

  • Provided 4.9 million microloans in the quarter with a total value of $250 million, up from 1.8 million microloans and $70 million value in the second quarter

Lin Song, Opera’s COO, said, “We are pleased with our strong third quarter results across all of our key metrics. We maintain a robust user growth trajectory while utilizing our scale to launch new products and further expand our market opportunity.

“Opera News continues to scale, with MAUs of our news app increasing 136% year-over-year to 41 million in the third quarter. We remain focused on driving user growth and increasing engagement through improved product quality and adding hyperlocal content on the platform. This includes the launch of Opera News Hub, a platform which allows content creators to publish and monetize through Opera News, which has already signed on 500 key opinion leaders. We continue to make progress monetizing our dedicated news app, with revenue up 44% versus the prior quarter.

“Opera Ads, our direct selling platform is evolving and expanding its capabilities. We are reaching an increasing number of both large businesses and small to medium sized enterprises which led to an increase in advertising revenue. Additionally, we launched OLeads, a product aimed at helping the tens of millions of small and medium enterprises in Nigeria grow and market their businesses online.

“Olist, our classified offering in Nigeria is progressing well. Listings have more than doubled to over 1 million from three months ago. We are focusing on growing listings and driving consumer awareness. We believe the potential in this area is very interesting, both in terms of advertising, but also from taking part in the underlying transactions through fee based models.

“On the browser side, our focus on product differentiation has led to continued growth with PC users up 16% year-over-year as we remain focused on privacy and security functionality, and supported by the continued success of Opera GX, our web browser tailored for gamers. Our smartphone user base also continued to grow during the quarter, as we launched offline file sharing in our Opera Mini browser that enables users to share content without using their mobile data or being limited by a slow network connection. The recent launch of our new tracker blocker is shown to speed up mobile browser speed by almost 20%.”

Business outlook

Mr. Frode Jacobsen, Opera’s CFO, said, “In light of the success we achieved during the third quarter of 2019, we are again raising our full-year revenue expectations. We now expect 77% revenue growth at the midpoint of our 2019 guidance. This view includes further growth in our microlending business and continued scaling of our advertising business. We expect our newest initiatives, including OList and additional fintech efforts, to be more of a factor in 2020. Further, we are increasing the lower end of our 2019 Adjusted EBITDA guidance. This reflects further margin expansion in the fourth quarter, while continuing to make aggressive investments in both existing and new initiatives aimed at driving strong multi-year growth.”

As a result, Opera expects fourth quarter and full year 2019 revenue and adjusted EBITDA to be in the following ranges:

Fourth Quarter:

  • Revenue of $95 - $105 million, or 89 - 109% growth versus the fourth quarter of 2018, driven by fintech revenue and to a lesser extent growth in advertising and search revenue. This growth will be offset by an expected significant decline in technology licensing revenue

  • Adjusted EBITDA of $15 - $19 million, representing margin expansion versus the third quarter

Full Year:

  • Revenue of $300 - $310 million, or 74 - 80% growth year-over-year, an increase from our previous guidance of $270 - $290 million

  • Adjusted EBITDA of $41 - $45 million

Third quarter 2019 consolidated financial results

All comparisons in this section are relative to the third quarter of 2018 unless otherwise stated.

Revenue increased 119% to $93.7 million.

  • Search revenue increased 13% to $21.5 million, primarily due to smartphone and PC browser growth.

  • Advertising revenue increased 17% to $18.3 million, due to an increase in both smartphone and PC users and continued monetization improvements.

  • Fintech revenue was $39.9 million. This revenue tripled versus the prior quarter due to rapidly scaling India and continued growth in Kenya.

  • Retail revenue was $6.0 million versus $2.9 million in the third quarter of 2018.

  • Technology licensing and other revenue was $7.9 million. This was higher than expected due to non-recurring incremental low margin revenue relating to investee support.

Operating expenses increased 181% to $87.0 million.

  • Cost of revenue was $15.0 million, compared to $10.1 million in the second quarter of 2019. Within the total, $6.0 million related to retail revenue, $8.8 million related to microlending and $0.2 million related to the browser and news business area.

  • Personnel expenses including share-based remuneration were $19.5 million, a 108% increase. This expense consists of cash-based compensation expense of $18.0 million, and $1.5 million of share-based remuneration expense. The increase included approximately $4.0 million of short-term elevated compensation cost relating to investee support, and some staff increases mainly related to Opera News, Opera Ads, microlending and other growth initiatives.

  • Marketing and distribution expenses were $20.0 million, an increase of 160% following our previously announced efforts to further invest in accelerating our growth in 2019.

  • Credit loss expense was $19.6 million, including $20.0 million related to microlending which was partially offset by a $0.4 million reduction in credit loss provision within the browser and news segment.

  • Depreciation and amortization expenses were $4.5 million, a 48% increase. The increase is largely the result of the adoption of IFRS 16 on January 1, 2019.

  • Other operating expenses were $8.3 million, a 19% increase.

Operating profit was $6.7 million, representing an operating margin of 7%, compared to $11.8 million and a 27% margin in the year-ago quarter. The decline was largely due to the increased investment in marketing and distribution activities and increased headcount associated with our growth initiatives.

Share of net income of associates and joint ventures amounted to $23.3 million, including a non-cash gain from the increased OPay valuation in connection with the company’s recent funding round.

Income tax expense was $1.7 million, compared to an expense of $1.0 million in the year-ago quarter.

Net income was $28.1 million, compared to $9.7 million in the third quarter of 2018.

Net income per ADS was $0.25 in the quarter, and $0.25 on a diluted basis.

Adjusted net income per ADS was $0.28 in the quarter, and $0.27 on a diluted basis. Each ADS represents two shares in Opera Limited. In the quarter, the average number of shares outstanding was 221.6 million, corresponding to 110.8 million ADSs. Note that the third quarter only includes 1.0 million impact of the 7.5 million new ADSs issued as part of the company’s follow-on offering. An additional 1.1 million new ADSs were issued in October related to the underwriters’ execution of the over-allotment option.

Adjusted EBITDA was $12.6 million, representing a 13% adjusted EBITDA margin, compared to $16.5 million in third quarter 2018. Adjusted EBITDA excludes share-based remuneration.

Adjusted Net Income was $30.6 million in the quarter, representing a 33% adjusted net margin compared to $12.5 million in third quarter 2018. Adjusted net income excludes share-based remuneration and amortization of intangible assets related to acquisitions (all of which relates to the Opera privatization in 2016). Adjusted net income further includes partially offsetting reversals of the tax impacts of the foregoing adjustments.

Other highlights included a follow-on public offering of 8.6 million American Depositary Shares (ADS), raising a total of $82.6 million net of underwriting discounts and commissions. The initial offering of 7.5 ADSs was completed on September 24th and the underwriters’ execution of the over-allotment option of 1.1 million ADSs was completed on October 16th.

Conference call

Opera’s management team will host a conference call from Lagos, Nigeria at 8:00 AM U.S. Eastern Time (2:00 PM Central European Time, 9:00 PM Beijing/Hong Kong time) on Thursday, November 14, 2019.

The dial-in details for the live conference call are:
United States: +1 (877) 506-7703
China: +86 400 682 8609
Hong Kong: +852 5819 4851
Norway: +47 239 64173
United Kingdom: +44 (0)203 107 0289
International: +1 (786) 815-8450
Confirmation Code: 7235635

A live webcast of the conference call will be posted at https://investor.opera.com.

About non-IFRS financial measures

To supplement our consolidated financial statements, which are prepared and presented based on IFRS, we use adjusted EBITDA and adjusted net income, both non-IFRS financial measures, to understand and evaluate our core operating performance. These non-IFRS financial measures, which may differ from similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with IFRS.

We define adjusted EBITDA as net income (loss) excluding income tax expense (benefit), net finance expense (income), share of net loss (income) of associates and joint ventures, restructuring costs, depreciation and amortization, share-based remuneration and expensed costs related to our recent initial public offering, less other income.

We define adjusted net income as net income excluding share-based remuneration, amortization of acquired intangible assets, and expensed costs related to our recent initial public offering.

We believe that adjusted EBITDA and adjusted net income provides useful information to investors and others in understanding and evaluating our operating results. These non-IFRS financial measures adjust for the impact of items that we do not consider indicative of the operational performance of our business. While we believe that these non-IFRS financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant as a substitute for the related financial information prepared and presented in accordance with IFRS. Please refer to our financial statements at the end of this announcement for a table reconciling our non-IFRS financial measures to net income (loss), the most directly comparable IFRS financial measure.

Safe harbor statement

This press release contains statements of a forward-looking nature. These statements, including statements relating to the Company’s future financial and operating results, are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by terminology such as “will,” “expects,” “believes,” “anticipates,” “intends,” “estimates” and similar statements. Among other things, management’s quotations and the Business outlook section contain forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about Opera and the industry. Potential risks and uncertainties include, but are not limited to, those relating to its goals and strategies; its expected development and launch, and market acceptance, of its products and services; its expectations regarding demand for and market acceptance of our brand, platforms and services; our expectations regarding growth in our user base and level of engagement; its ability to attract, retain and monetize users; its ability to continue to develop new technologies and/or upgrade our existing technologies and quarterly variations in its operating results caused by factors beyond its control and global macroeconomic conditions and its potential impact in the markets it has businesses. All information provided in this press release is as of the date hereof, and Opera undertakes no obligation to update any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although Opera believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results. Further information regarding risks and uncertainties faced by Opera is included in Opera’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F.

About Opera

Opera is a leading global internet brand with an engaged and growing base of over 350 million average monthly active users. Building on over 20 years of innovation, starting with our browser products, we are increasingly leveraging our brand as well as our massive and highly active user base in order to expand our offerings and our business. Today, we offer users across Europe, Africa and Asia a range of products and services that include our PC and mobile browsers as well as our AI-powered news reader Opera News and our app-based microfinance solutions.

 
OPERA LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
 
  Three Months Ended September 30,  Nine Months Ended September 30, 
[US$ thousands, except per share and ADS amounts] 2018  2019  2018  2019 
Revenue  42,795   93,678   122,069   205,245 
                 
Operating expenses                
Cost of revenue  (3,663)  (15,023)  (5,741)  (32,906)
Personnel expenses including share-based remuneration  (9,378)  (19,495)  (29,844)  (46,180)
Marketing and distribution expenses  (7,709)  (20,029)  (22,885)  (55,799)
Credit loss expense  (162)  (19,641)  167   (27,274)
Depreciation and amortization  (3,051)  (4,511)  (9,817)  (12,934)
Other expenses  (6,992)  (8,326)  (21,862)  (22,236)
Total operating expenses  (30,954)  (87,026)  (89,982)  (197,329)
                 
Operating profit (loss)  11,841   6,652   32,086   7,917 
                 
Share of net income (loss) of associates and joint ventures  (1,757)  23,295   (3,381)  26,252 
                 
Net finance income (expense)                
Finance income  629   611   827   3,970 
Finance expense  (54)  (222)  (131)  (548)
Net foreign exchange gain (loss)  28   (539)  140   (693)
Net finance income (expense)  603   (151)  836   2,728 
                 
Net income (loss) before income taxes  10,687   29,797   29,541   36,897 
Income tax (expense) benefit  (970)  (1,677)  (5,794)  (974)
Net income (loss)  9,717   28,120   23,747   35,923 
                 
Net income (loss) attributable to:                 
Equity holders of the parent  9,717   28,120   23,747   35,923 
Non-controlling interests  -   -   -   - 
Total net income (loss) attributed  9,717   28,120   23,747   35,923 
                 
Weighted average number of ordinary shares outstanding                 
Basic, millions(1)  209.99   221.55   196.83   220.31 
Diluted, millions(2)  216.82   225.89   202.92   224.83 
                 
Net income (loss) per ordinary share                 
Basic, US$  0.05   0.13   0.12   0.16 
Diluted, US$  0.05   0.12   0.12   0.16 
                 
Net income (loss) per ADS                
Basic, US$  0.09   0.25   0.24   0.33 
Diluted, US$  0.09   0.25   0.23   0.32 


(1) Assuming 200 million shares in Opera Limited were outstanding for all periods presented prior to the Initial Public Offering (IPO), less 9.75 million shares that were surrendered by two shareholders upon completion of the IPO. As of September 30, 2019, the total number of shares outstanding for Opera Limited was 235,576,326, equivalent to 117,788,163 ADSs.
 
(2) Includes the net dilutive impact of employee equity awards, all of which are dilutive.


 
OPERA LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
 
  Three Months Ended September 30,  Nine Months Ended September 30, 
[US$ thousands] 2018  2019  2018  2019 
Net income (loss)  9,717   28,120   23,747   35,923 
                 
Other comprehensive income (loss) that may be reclassified to the Statement of Operations in subsequent periods (net of tax)                
Exchange differences on translation of foreign operations  (177)  (1,982)  (1,273)  (2,092)
Reclassification of exchange differences on loss of control  -   -   (138)  7 
Share of other comprehensive income (loss) of associates and joint ventures  -   -   -   (41)
Net other comprehensive income (loss) that may be reclassified to the Statement of Operations in subsequent periods  (177)  (1,982)  (1,411)  (2,126)
Total comprehensive income (loss)  9,541   26,139   22,336   33,797 
                 
Total comprehensive income (loss) attributable to:                
Equity holders of the parent  9,541   26,139   22,336   33,797 
Non-controlling interests  -   -   -   - 
Total comprehensive income (loss) attributed  9,541   26,139   22,336   33,797 


OPERA LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
 
  As of December
31,
  As of September
30,
 
[US$ thousands] 2018  2019 
ASSETS        
Non-current assets        
Furniture, fixtures and equipment  12,162   27,689 
Intangible assets  115,444   112,355 
Goodwill  421,578   421,578 
Investments in associates and joint ventures  35,060   67,560 
Non-current financial assets  2,025   2,689 
Deferred tax assets  944   - 
Total non-current assets  587,213   631,870 
         
Current assets         
Trade receivables  37,468   47,983 
Loans to customers  3,092   55,508 
Other receivables  4,031   3,931 
Prepayments  14,372   26,857 
Inventories  -   1,932 
Other current financial assets  89   - 
Marketable securities  1,165   45,253 
Cash and cash equivalents  177,873   170,697 
Total cash, cash equivalents, and marketable securities  179,038   215,950 
Total current assets  238,090   352,161 
TOTAL ASSETS  825,303   984,031 
         
         
EQUITY AND LIABILITIES        
Equity         
Share capital  22   24 
Other paid in capital  738,690   803,896 
Retained earnings  36,432   76,044 
Foreign currency translation reserve  316   (1,810)
Equity attributed to equity holders of the parent  775,460   878,154 
Non-controlling interests  -   - 
Total equity   775,460   878,154 
         
Non-current liabilities        
Non-current lease liabilities and other loans  2,271   9,750 
Deferred tax liabilities  13,358   13,654 
Other non-current liabilities  212   130 
Total non-current liabilities   15,841   23,534 
         
Current liabilities        
Trade and other payables  17,957   41,542 
Current lease liabilities and other loans  2,490   26,471 
Income tax payable  1,920   1,700 
Deferred revenue  1,932   1,159 
Other current liabilities  9,701   11,471 
Total current liabilities  34,002   82,343 
         
Total liabilities  49,843   105,877 
TOTAL EQUITY AND LIABILITIES   825,303   984,031 


 
OPERA LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
 
[US$ thousands] Share capital (1)  Other paid
in

capital (1)
  Retained
earnings
  Foreign
currency
translation
reserve
  Total equity  
As of December 31, 2017, as previously reported  19   576,512   5,366   1,605   583,503 
Impact of new accounting standards  -   -   (629)  -   (629)
As of January 1, 2018, restated  19   576,512   4,737   1,605   582,874 
Net income (loss)  -   -   23,747   -   23,747 
Other comprehensive income (loss)  -   -   -   (1,411)  (1,411)
Total comprehensive income (loss)  -   -   23,747   (1,411)  22,336 
Contribution of equity, net of transaction costs  3   167,153   -   -   167,156 
Share-based remuneration expense  -   -   4,638   -   4,638 
As of September 30, 2018  22   743,665   33,122   194   777,003 


[US$ thousands] Share capital (1)  Other paid
in

capital (1)
  Retained
earnings
  Foreign
currency
translation
reserve
  Total equity  
As of December 31, 2018  22   738,690   36,432   316   775,460 
Impact of implementing IFRS 16 Leases  -   -   64   -   64 
As of January 1, 2019, restated  22   738,690   36,496   316   775,524 
Net income (loss)  -   -   35,923   -   35,923 
Other comprehensive income (loss)  -   -   -   (2,126)  (2,126)
Total comprehensive income (loss)  -   -   35,923   (2,126)  33,797 
Contribution of equity, net of transaction costs  2   70,986   -   -   70,988 
Acquisition of treasury shares  -   (5,780)  -   -   (5,780)
Share-based remuneration expense  -   -   3,624   -   3,624 
As of September 30, 2019  24   803,896   76,044   (1,810)  878,154 


(1) The amounts of share capital and other paid in capital have been amended by reclassifying amounts between the two equity components.


 
OPERA LIMITED
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
[US$ thousands] 2018  2019  2018  2019 
                 
Net cash flow from (used in) operating activities  6,820   (17,539)  21,713   (24,460)
Net cash flow from (used in) investing activities  (2,426)  (35,311)  (3,713)  (62,794)
Net cash flow from (used in) financing activities  169,463   90,206   167,117   81,041 
                 
Net change in cash and cash equivalents   173,857   37,356   185,118   (6,213)
                 
Cash and cash equivalents at beginning of period  43,993   134,155   33,207   177,873 
Net foreign exchange difference  (209)  (813)  (682)  (962)
Cash and cash equivalents at end of period  217,642   170,697   217,642   170,697 


 
Financial details by business area
 
The tables below specify the contribution by each business area:
 
[US$ thousands] Three months ended September 30, 2018 
Business area Browser and News  Fintech  Retail  Other  Total 
Revenue categories                    
Search  19,130   -   -   -   19,130 
Advertising  15,679   -   -   -   15,679 
Origination fees and interest  -   -   -   -   - 
Airtime and handsets  -   -   2,871   -   2,871 
Technology licensing and other revenue  -   -   -   5,116   5,116 
Total revenue  34,809   -   2,871   5,116   42,795 
                     
Cost of revenue  (672)  -   (2,991)  -   (3,663)
Marketing and distribution expenses  (7,709)  -   -   -   (7,709)
Credit loss expense  (162)  -   -   -   (162)
Direct expenses  (8,543)  -   (2,991)  -   (11,534)
                     
Contribution by business area  26,266   -   (120)  5,116   31,262 


[US$ thousands] Three months ended September 30, 2019 
Business area Browser and News  Fintech  Retail  Other  Total 
Revenue categories                    
Search  21,527   -   -   -   21,527 
Advertising  18,349   -   -   -   18,349 
Origination fees and interest  -   39,858   -   -   39,858 
Airtime and handsets  -   -   6,006   -   6,006 
Technology licensing and other revenue  -   -   -   7,937   7,937 
Total revenue  39,876   39,858   6,006   7,937   93,678 
                     
Cost of revenue  (207)  (8,797)  (6,019)  -   (15,023)
Marketing and distribution expenses  (16,831)  (3,198)  -   -   (20,029)
Credit loss expense  345   (19,986)  -   -   (19,641)
Direct expenses  (16,693)  (31,981)  (6,019)  -   (54,693)
                     
Contribution by business area  23,183   7,877   (13)  7,937   38,985 


[US$ thousands] Nine months ended September 30, 2018 
Business area Browser and News  Fintech  Retail  Other  Total 
Revenue categories                    
Search  59,115   -   -   -   59,115 
Advertising  42,312   -   -   -   42,312 
Origination fees and interest  -   -   -   -   - 
Airtime and handsets  -   -   2,871   -   2,871 
Technology licensing and other revenue  -   -   -   17,771   17,771 
Total revenue  101,427   -   2,871   17,771   122,069 
                     
Cost of revenue  (2,750)  -   (2,991)  -   (5,741)
Marketing and distribution expenses  (22,885)  -   -   -   (22,885)
Credit loss expense  167   -   -   -   167 
Direct expenses  (25,468)  -   (2,991)  -   (28,459)
                     
Contribution by business area  75,959   -   (120)  17,771   93,610 


[US$ thousands] Nine months ended September 30, 2019 
Business area Browser and News  Fintech  Retail  Other  Total 
Revenue categories                    
Search  63,514   -   -   -   63,514 
Advertising  48,649   -   -   -   48,649 
Origination fees and interest  -   56,466   -   -   56,466 
Airtime and handsets  -   -   20,471   -   20,471 
Technology licensing and other revenue  -   -   -   16,145   16,145 
Total revenue  112,163   56,466   20,471   16,145   205,245 
                     
Cost of revenue  (1,420)  (11,058)  (20,428)  -   (32,906)
Marketing and distribution expenses  (51,730)  (4,069)      -   (55,799)
Credit loss expense  (200)  (27,074)  -   -   (27,274)
Direct expenses  (53,350)  (42,201)  (20,428)  -   (115,979)
                     
Contribution by business area  58,813   14,265   43   16,145   89,266 


Personnel expenses including share-based remuneration
The table below specifies the amounts of personnel expenses including share-based remuneration:
 
[US$ thousands] Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
Personnel expenses including share-based remuneration 2018  2019  2018  2019 
Personnel expenses excluding share-based remuneration  8,617   18,012   26,416   41,726 
Share-based remuneration, including related social security costs  761   1,483   3,427   4,454 
Total  9,378   19,495   29,844   46,180 


Other expenses
 
The table below specifies the nature of other expenses:
 
[US$ thousands] Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
Other expenses 2018  2019  2018  2019 
Hosting  2,470   1,879   7,649   5,278 
Audit, legal and other advisory services  1,865   2,122   6,743   6,093 
Software license fees  356   494   1,248   1,789 
Rent and other office expense  1,032   1,553   3,368   3,917 
Travel  540   1,017   1,570   2,401 
Other  729   1,262   1,284   2,757 
Total  6,992   8,326   21,862   22,236 


 
Non-IFRS financial measures 
  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 
[US$ thousands, except per share and ADS amounts] 2018  2019  2018  2019 
Reconciliation of net income (loss) to adjusted EBITDA                
Net income (loss)  9,717   28,120   23,747   35,923 
Add: Income tax expense (benefit)  970   1,677   5,794   974 
Add: Net finance expense (income)  (603)  151   (836)  (2,728)
Add: Share of net loss (income) of associates and joint ventures  1,757   (23,295)  3,381   (26,252)
Add: Depreciation and amortization  3,051   4,511   9,817   12,934 
Add: Share-based remuneration  761   1,483   3,427   4,454 
Add: Expensed IPO related costs  843   -   2,952   - 
Adjusted EBITDA  16,495   12,647   48,283   25,305 
                 
Reconciliation of net income (loss) to adjusted net income                
Net Income (loss)  9,717   28,120   23,747   35,923 
Add: Share-based remuneration  761   1,483   3,427   4,454 
Add: Amortization of acquired intangible assets  1,280   1,280   3,840   3,840 
Add: Expensed IPO related costs  843   -   2,952   - 
Income tax adjustment (1)  (106)  (305)  (816)  (1,029)
Adjusted net income  12,494   30,578   33,151   43,188 
                 
Weighted average number of ordinary shares outstanding                
Basic, millions  209.99   221.55   196.83   220.31 
Diluted, millions  216.82   225.89   202.92   224.83 
                 
Adjusted net income (loss) per ordinary share                
Basic, US$  0.06   0.14   0.17   0.20 
Diluted, US$  0.06   0.14   0.16   0.19 
                 
Adjusted net income (loss) per ADS                
Basic, US$  0.11   0.28   0.34   0.39 
Diluted, US$  0.11   0.27   0.33   0.38 


(1) Reversal of tax benefit related to the social security cost component of share-based remuneration, deferred taxes on the amortization of acquired intangible assets, and expensed IPO-related costs. 

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