Vostok Nafta Investment Three Months Report 2014 (VNV Global)

Summary

• Net result for the period was USD –67.02 million, compared with 23.79 in the same period of 2013.p.3
• Net asset value was USD 515.79 mln on March 31, 2014 (December 31, 2013: 633.97), or USD 6.20 per share (7.05).p.3
• Net asset value per share in USD decreased by 12.13% over the period January 1, 2014–March 31, 2014, while the RTS index decreased by 15.02%.p.4
• Vostok Nafta has spent some USD 114 mln buying back just shy of 17% of the outstanding shares.p.4
• Liquid assets of the group amounted to USD 152.26 mln on March 31, 2014 (December 31, 2013: 246.57).p.7
• Gross investments in financial assets were USD 54.35 (2013: 4.49) mln and proceeds from sales were USD 11.82 (0) mln.p.7

Key insights

1. 70% of the free float in Russian bonds and equities is held by foreigners, so capital market swings follow developments in Ukraine.p.3
2. The Board gave management a renewed mandate to repurchase up to an additional 10% of the outstanding shares.p.4
3. Avito page views for the full year 2013 amounted to 47 bln, compared to 26 bln for the previous year.p.5
4. Avito's founders sold 10% of their holdings, which corresponds to approximately 1.7% of the total.p.5
5. TCS net income for the full year 2013 amounted to USD 181 mln, up 48% year on year.p.6
6. TCS had a net loan portfolio of USD 2.3 bln as of December 31, 2013 and a market share of 7.5%, placing it as the #3 credit card issuer in Russia.p.6
7. A 20% lower/higher valuation of Avito would result in a decrease/increase of USD 48.3 million or 9.3% of the total portfolio.p.14