April 25, 2013 / 12:30 PM / in 5 years

UPDATE 1-Russia's Yandex raises revenue guidance

* Sees revenues rising by 30-35 pct vs 28-32 pct previously

* First-quarter revenues up 36 pct year-on-year

* Net profit rises 79 pct to 2.2 bln roubles

MOSCOW, April 25 (Reuters) - Russian internet group Yandex on Thursday increased its full-year 2013 revenue forecast after first-quarter sales growth topped its previous guidance, supported by increasing Internet use and e-commerce.

Yandex, which in Russia is ahead of the world’s top search engine Google with a more than 60 percent share of the market, sees rouble-based revenues rising by 30-35 percent this year, up from its earlier guidance of 28-32 percent.

The company, which derives the bulk of its revenues from text-based advertising, has recently redesigned its homepage and updated its Yandex.Navigator and Yandex.Market mobile applications to attract more advertisers.

Its first-quarter revenues rose 36 percent, year-on-year, to 8 billion roubles ($253.66 million), driven by 35 percent growth in text-based advertising which accounted for 89 percent of total sales.

The company also saw a pick-up in display advertising revenues which jumped 48 percent after a 12 percent increase in the previous quarter.

Its net profit rose 79 percent in the first quarter to 2.2 billion roubles despite higher costs associated with investments in growth, including personnel.

Adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) increased 47 percent to 3.5 billion roubles, giving a 43.8 percent margin.

Rival internet company Mail.Ru Group reported earlier on Thursday a 29.4 percent rise in first-quarter sales to 6.3 billion roubles. It expects full-year 2013 sales to grow 25-28 percent.

According to LiveInternet, Yandex currently has a 61.6 percent share of the Russian search market, Google has a 26 percent share and Mail.Ru has 8.8 percent.

Shares in Yandex closed at $21.45 on Wednesday, having fallen by 11 percent in the past two months in part due to the sale by existing shareholders of a 7.4 percent stake in March.

Yandex raised $1.4 billion in an oversubscribed initial public offering in New York in May 2011 that was priced at $25 per share.

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