This document summarizes an opportunity to acquire a top 10 online event ticket sales company in Russia. The company has over 500,000 customers, 20-25% market share in Moscow, and generated $1 billion in gross sales and $47 million in EBIT in 2017. The online ticket sales industry in Russia is growing rapidly due to rising incomes and internet penetration. Acquiring this company would provide access to the underpenetrated Russian market and the opportunity for sales growth through expanding product offerings and entering new regions.

1. Online Ticket Sales
Company
A fast-growth business of online
event ticket sales in Russia
The Company is a unique opportunity to enter a fast-growth Russian market of online event ticket sales. 100% skate in the
company is currently up for sale. The company is one of the top 10 Russian online event ticket sales operators with Rub 1
billion in gross sales in 2017 and strong profitability figures. The company has been operating mainly in the Moscow and
Moscow region since 2011, has more than 500 thousand customers, and a market share of 20-25% in Moscow (3-4% in
Russia). The company has valid contracts with over 700 event organizers and concert halls for online tickets distribution. In
2017 alone, the Company entered into contracts with 75 major theaters in Moscow (44% of all theaters in the city) and
currently enjoys exclusivity status for such events as Philip Kirkorov Tour (a famous Russian pop star), Ruslan and Lyudmilla Ice
Show Musical, and others. Key distribution channels are company website, mobile application, widgets on actors’ websites. The
company demonstrated 44% gross ticket sales growth in 2017 and expects to increase gross sales by over 60% in 2018.
Operating a lean cost structure model, the company has strong profitability figures relative to its peers with 2017 EBIT of Rub 47
million (5% of total gross sales, circa 50% of net sales). This allows the company to generate strong cash flow and carry zero
debt on its balance sheet.
The Online Event Ticket Sales industry in Russia has grown strongly over the last 10 years amid a major shift from physical
tickets and at-home printing to a fully digitized mobile ticketing experience. Over the past 5 years, personal disposable incomes
in the country have grown alongside the music industry's continued shift toward live performance. Moreover, economic situation
in Russia stabilized in 2016-2017 and penetration of the Internet access has reached almost 75% (among 16+ population). The
ease of online commerce, particularly through mobile wallets, and digital ticketing, has significantly benefited both the size and
profitability of the Online Event Ticket Sales industry. As the economy is anticipated to continue its expansion and consumer
disposable incomes are expected to rise, online ticket sellers will remain one of the primary sources of tickets for sporting
events, concerts, festivals, public appearances and theatrical performances. The acquisition of the Company will give an
investor access to the market which is still underpenetrated, especially in terms of mobile ticket sales. According to PwC, online
event ticket sales in Russia accounted for 52% of total ticket sales in the country in 2018. The broader market of event ticket
sales is forecasted to grow at 8.7% CAGR from $650 million in 2018 to $909 million in 2022. Given the online market
underpenetration and a broader market sales growth prospects we could expect the online event ticket sales market to continue
growing at double-digit rates in the future.
A Top 10 Online Event Ticket Sales Operator in Russia
Generating Strong Growing Sales and Having Outstanding
Profitability
Investment Opportunity
Favorable Market Situation
Key investment thesis – The company operates on a growing underpenetrated market of online event ticket sales in
Russia where most other larger competitors have larger gross sales but lower profitability. Therefore, an investor buying into
this company will acquire a more robust and leaner successful business model and will be better positioned for further growth.
Source: Company data
Source: Company data
Source: Company data
CAGR
47%
Growth Strategy
Taking into account favorable market situation, the company targets to double its gross sales in the period 2018-2022 by
focusing on the least penetrated segments such as kids event sales (music and theater performances) and sporting events.
Sales growth should also be supported by further product development such as creating a IT gateway for event organizers, and
expansion into new geographical markets such as S-Petersburg, Krasnodar, Novosibirsk, Yekaterinburg.
Even though there have already been some attempts at consolidation, the online event ticket sales market in Russia remains
largely fragmented which leaves the door wide open for M&A activities. The most prominent recent M&A deal is the
acquisition by MTS of TicketLand, an event ticket sales company with net sales of Rub 1 billion, for Rub 3.25 billion.
Strong Prospects for Consolidation through M&A