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outbreak at one of its facilities at the Belgorod region on July 18. "All of the livestock in the facility will be eliminated, and the premises cleared," Rusagro said, while noting that it is estimating the damage that could be caused by the outbreak. Following mixed first-quarter operational results, Rusagro posted a 23% year-on-year decline in revenues in the first quarter, with Ebitda declining by 37% y/y to RUB1.7bn at a margin of 11%, below consensus expectations. This week the European Union introduced a complete ban on Russian poultry imports due to outbreaks of bird flu. Currently out of 18 Russian poultry exporters with access to the EU market, the largest companies Cherkizovo and Damante are fighting bird flu outbreaks in the Rostov, Kursk, Samara, Orlov, and Penza regions. Another market leader Eurodon has also had bird flu outbreaks at two out of its 24 turkey farms, Interfax and Vedomosti daily reported on July 16. Last time the company faced outbreaks in 2016 and 2017 it lost over 1mn birds which led to RUB2.6bn ($42mn) damages.
9.2.7 TMT corporate news
Despite the Russian government’s best efforts to crush the encrypted messaging service Telegram, the number of its users has risen not fallen : the number of economically active users in big Russian cities reached 3.67mn people, Vedomosti d aily said on June 29 citing the data of Mediascope. Compared to October 2017 when the state began its assult on the service, the number of Russian users jumped by 70%, with the largest increase seen in March when Russian court ruled that Telegram should pass the encryption keys to the Federal Security Bureau (FSB). Users value the privacy the service affords as it said to be uncrackable. The service has also flourished in Iran where the authorities also moved this year to ban it.
Russian internet services major Mail.ru reported Ebitda of RUB3.7bn ($58mn) in the second quarter of 2018 , declining by 13% year-on-year and 8% quarter-on-quarter, and coming in below analysts' expectations. However, lower earnings are to be "was attributable to the seasonal weakness of Q2 and in line with the company's guidance that 2018 costs would be front-loaded in 1H18," Sberbank CIB argued on July 26. "Mail.Ru Group attributes the 13.3% y/y Ebitda contraction in 2Q18 to extensive investments into new initiatives that are not yet contributing to Ebitda but represent potential," Aton Equity commented. Previously Mail.ru margins were already under pressure due to growing investments across multiple segments, from gaming and e-sports , location-based and cross-border marketplaces Youla and Pandao, to food delivery with Delivery Club, money transfers , and the taxi market . The first-quarter results also showed that investments were eating into the group's profits . Still, Mail.ru Group's revenues increased 30.2% y/y to RUB17bn in the second quarter, driven by ad revenues (up 37.4% to RUB7.3bn) and games (up 38% to RUB5.3bn). Revenues from VKontakte social network continued strong growth, adding 59% y/y RUB4.4bn.
Russian internet services major Mail.ru bought 20% of United Media Agency (UMA), which owns the copyrights for the music library of the VKontakte social network controlled by Mail.ru, Kommersant daily said on July 26. UMA is also developing Boom, a music streaming app for the social network. Previously Mail.ru said that the number of active paid and trial subscriptions for Boom reached 1.5mn . Mail.ru launched a new paid subscription for streaming music on social networks VKontakte and Odnoklassniki in April 2017, as well as mobile app, cutting the free listening
81 RUSSIA Country Report August 2018 www.intellinews.com