Letter to Shareholders
Last year was challenging and unprecedented in many ways. However, Ozon has emerged from 2020 as a stronger and more developed company, one that is leading the way in Russian e-commerce today.

Our focus on infrastructure, customer service and value-added services has laid the groundwork for Ozon's super-charged growth and the company's $1.2 billion IPO in November 2020, which Bloomberg News called Russia's most successful listing since 2011.

Starting in Q1 of 2020, the pandemic-linked restrictions that
were introduced in Russia have encouraged many to try online shopping for the first time. While some might have turned to e-commerce reluctantly at first, the convenience and customer service they have discovered at Ozon have helped to cement our platform's position as the go-to shopping destination for everyday shopping needs, ranging from groceries and electronics to toys and apparel.

I can credit Ozon's focus on building up our fulfilment and logistics backbone with enabling us to provide such a robust customer preposition.

The number of orders placed on Ozon surged by 132% year-on-year in 2020 to reach 73.9 million, compared with 31.8 million orders in FY2019 as order frequency also increased year-on-year. We deliver goods to households across all the 11 time zones in Russia; some 85 million Russians have access to Ozon's courier delivery or a pick-up point within walking distance of their home.

The acceleration of digital adoption has also spurred us to accelerate the development of Ozon Express, our fast e-grocery delivery offering. This service allows customers to receive their groceries and other goods within just one hour of placing an order.
Dear Ozon Shareholders,
Daniil Fedorov,
COO of Ozon
132%
year-on-year
The number of orders placed on Ozon
March 31, 2021
Strong Growth Acceleration
The figures show that our customers like what we offer.
The number of active buyers on Ozon almost doubled in 2020 to reach 13.8 million.
As our customer base and the number and frequency of orders increased, our Gross Merchandise Value including services jumped to ₽197.4 million, representing an acceleration in GMV inc. services growth of 144% year-on-year.
The pandemic year not only caused an unprecedented transformation of consumer habits, but also changed the way businesses interact with clients.
The number of sellers on the platform quadruple at the end of Q4, 2020, compared with the same period a year ago.
Going digital became the best way forward for many SMEs, struggling to adapt. This also drove some important changes in our sales model.
We also supported our sellers with Ozon.Invest, our platform that helps merchants secure financing.

While the pandemic served as an important catalyst, the foundation for Ozon's robust growth can be traced further back to some important changes to our business strategy, which we began implementing in 2018. These include a structural shift from a first-party (1P) to a third-party (3P) relationship model with sellers, as well as assortment expansion, significant investment in fulfilment and logistics infrastructure, extensive efforts in product development both for buyers and sellers and a keen focus on operational efficiency.
Scale and efficiency improvements create better unit economics
Today marks an important milestone for us, as we disclose our financial indicators as a public company for the first time. I am pleased to highlight that we have improved our financial performance thanks to our disciplined approach and focus on efficiency, even as we continue to invest in extending our reach and increasing our scale across Russia's underpenetrated, fragmented market.

While we had the capacity to turn profitable already in 2020, we made a strategic decision to continue investing in our infrastructure network. Sustainable profitability comes with scale and we view this time as a critical one for gaining market share, while we also continue to increase our efficiency.

This focus enabled us to achieve better financial performance, including positive operating cash flow and lower operating expenses as a percentage of GMV, and improve other financial indicators.
Ozon's main pillars and emerging verticals
Marketplace
The platform offers Russian SMEs the best-in-class, country-wide fulfilment and logistics infrastructure, including last mile capabilities, as well as value-added business services such as Financial Products andan Advertising Platform for sellers.
in Q42020 the share of the Marketplace as a percentage of GMV doubled from Q4 2019
52%
In Q4 2020, the number of sellers on Ozon quadrupled versus Q4 2019. Our fast-growing seller base brought with it a rapid expansion of assortment. In turn, a greater variety of goods on Ozon has led to higher customer engagement and greater order frequency, which resulted in higher sales for our sellers and an acceleration in Ozon's GMV growth.
Fulfillment
square meters of fulfilment center space
We continue to actively invest in our logistics and fulfillment infrastructure. By the end of 2020, we operated one of the largest logistics networks in Russia with more than 220 thousand square meters of fulfilment center space in major Russian cities such as Moscow, Saint-Petersburg, Kazan, Rostov-on-Don, Yekaterinburg and Novosibirsk.
Logistics
Throughout 2020 we also continued to actively expand our last-mile network, including pick-up points, courier delivery and parcel lockers.
branded pick-up locations as of the end of 2020
people across Russia have access to Ozon delivery and pick-up locations within walking distance
Fintech Services
In 2020 we continued to build out the Ozon ecosystem to make it more attractive to both the buyers and the Marketplace sellers. To this end, digital financial services have become its core components, aimed at providing fast and seamless access to lending and payment solutions for our millions-strong buyer base (B2C) and for the fast-growing ranks of the merchants on our platform (B2B).
We found that Ozon.Card holders exhibit greater customer loyalty and order frequency that is 1.6x higher on average, compared with customers using other payment methods.
December
2019
450,000
In 2019, Ozon introduced the Ozon.Card, a cashback debit card for our customers.
In 2020, we launched a digital version of the Ozon.Card, to enable customers to instantly sign up and begin using the service.
December
2020
57,000
Number of active Ozon.Card users
Ozon Express
Our Ozon Express service delivers groceries and other goods within one hour of placing an order. Currently covering all of Moscow, this service is very popular, and we have plans to expand it to other Russian cities in 2021.
Ozon Express uses a targeted dark store concept, based on an assortment mix that caters to specific preferences and consumption patterns of any given micro-region. It offers more than 22,000 stock keeping units (SKUs) across 20 food and non-food product categories.
Market trends and key priorities for 2021 and beyond
We intend to continue working hard, going full steam ahead and believe in the tremendous opportunities that Russian e-commerce has to offer. We see growth prospects across the board – both in the numbers of buyers and sellers and in terms of order frequency – compounding positive network effects.
Ozon's fulfilment infrastructure will grow noticeably in the next 2-3 years. We will add new sorting centers and drop-off locations, as well as thousands of trucks to achieve greater scale and better proximity to our sellers. This should strengthen our market position with a view that greater scale supports future profitability.
We aim to expand our new and existing verticals, including those offering fintech products to both our buyers and sellers.
We are also strengthening our backend and customer-facing tech infrastructure and continuing to improve the platform for our sellers.
I see 2021 as a year of focus on operational excellence for us.
We will concentrate on launching new and developing existing products and services, supporting high standards of customer care for B2C and B2B clients, and continuing to expand our logistics infrastructure. All of these measures will help us strengthen the foundation for future growth.
Thank you

Daniil Fedorov
COO of Ozon
All Ozon's 4Q and Fiscal Year 2020 financial and operational results are available are available at corporate site.
for your confidence in Ozon and for your support of our role in Russia's e-commerce revolution.