Recent news

02.08.2010
Uralsvyazinform releases H1 2010 financial results: net profit up 2.1 times

Press Release

Uralsvyazinform (RTS and MICEX) URSI/URSIP, ADR: UVYZY/UVYZYP) – a universal telecommunications operator – hereby presents its unconsolidated operating and financial results for the first six months of 2010 in accordance with Russian Accounting Standards.

The highlights of the H1 2010 financial statement are as follows:

With a 6.1% rise in revenue and thanks to strict cost control the Company managed to reduce its expenses by 3.5% compared to the first six months of 2009, which resulted in a major increase in economic efficiency indicators. Higher revenue was driven by a rise in revenue from datacom and Internet access, mobile telephony and local voice.
Revenue from datacom and Internet access increased by 12.6% and amounted to RUR 3,525 mln. The number of broadband Internet users increased by 32.2% compared with the first six months of 2009 and stood at 79.2 Petabytes.
Revenue from cellular telephony increased by 11.4% and stood at 6,947.8 mln thanks to a 13.3% increase in average monthly revenue per user (ARPU) to RUR 204 (vs. RUR 180 in H1 2009), which was the result of tariff policy optimization in this segment.
Local voice revenue went up 7.0% and stood at RUR 5,610.6 mln as a result of tariff indexation effective January 1, 2010 in accordance with a decision by the Federal Tariff Service.
A decrease in operating expenses was mainly attributable to lower interconnect expenses, including optimization of the cost of backbone Internet traffic roaming payments.
EBITDA advanced 23.7% and amounted to RUR 9,490.2 mln, while EBITDA/revenue went up 6.3% and stood at 44.5% in H1 2010.
Net profit increased 2.1 times to RUR 3,977.2 mln net profit/revenue rose 9.1% to 18.6%.
The proportion of regulated services (datacom, ISP and cellular telephony) in telecommunications revenue increased to 50.4% (up from 47.9% in H1 2009);
The Company continued to work on deleveraging: total liabilities on credits and loans decreased by 36.7% to RUR 13,038.7 mln compared to the beginning of 2010.

Headline financial indicators

	1H 2010	1H 2009	Change
Revenue, RUR, mln	21,329.0	20,103.4	+6.1%
Expenses, RUR, mln	15,440.0	16,004.6	-3.5%
EBITDA, RUR, mln	9,490.2	7,669.2	+23.7%
EBITDA margin	44.5%	38.1%	+6.3%
Operating profit, RUR, mln	5,889.0	4,098.7	+43.7%
Operating margin	27.6%	20.4%	+7.2%
Pre-tax profit, RUR mln	5,133.8	2,523.9	+103.4%
Net profit, RUR, mln	3,977.2	1,920.8	+107.1%
Net margin	18.6%	9.6%	+9.1%
EBITDA is calculated as the sum of pre-tax profit, interest payable, depreciation, expenses as lease payments and additional expenses for credits and loans minus interest receivable. EBITDA margin, Operating margin, and Net margin calculated as the ratio of the respective indicator (EBITDA, Operating profit, Net profit) to revenue.

Headline operating indicators

	1H 2010	1H 2009	Change
Number of subscribers: fixed-line, th. сellular telephony, th. broadband Internet access, th. paid television*, th.	3,688.5 5,521.3 811.1 121.9	3,724.6 5б655.8 613.7 118.5	-1.0% -2.4% +32.2% +2.9%
Outgoing traffic of intrazonal telephony, mln min.	940.2	1,028.7	-8.6%
Datacom traffic, PB	79.2	41.9	+89.0%
*Cable TV subscribers + interactive Utel TV

Revenue breakdown

	1H 2010		1H 2009		Change
	RUR, mln	proportion	RUR, mln	proportion	Change
Cellular telephony	6,947.8	33.4%	6,238.5	31.9%	+11.4%
Local voice	5,610.6	27.0%	5,245.2	26.9%	+7.0%
Datacom and ISP	3,525.0	17.0%	3,130.2	16.0%	+12.6%
Interconnect and traffic transmission	2,199.1	10.6%	2,276.2	11.7%	-3.4%
Intrazonal telephony	2,131.4	10.2%	2,308.7	11.8%	-7.7%
Wire broadcasting	150.3	0.7%	137.0	0.7%	+9.7%
Radio and television broadcasting	137.0	0.7%	129.8	0.7%	+5.5%
Data transmission	75.2	0.4%	67.0	0.3%	+12.2%
TOTAL	20,776.4	100.0%	19,532.6	100.0%	+6.4%

Breakdown of operating expenses

	1H 2010		1H 2009		Change
	RUR, mln	proportion	RUR, mln	proportion	Change
Payrolls	3,131.6	20.3%	3,044.9	19.0%	+2.8%
Social insurance contributions	751.7	4.9%	722.7	4.5%	+4.0%
Depreciation of fixed assets	3,014.6	19.4%	3,062.8	19.2%	-1.6%
Interconnect	2,402.8	15.6%	2,882.9	18.0%	-16.7%
Outsourcing	1,235.6	8.0%	1 313.2	8.2%	-5.9%
Materials	927.6	6.0%	981.1	6.1%	-5.5%
Lease payments	674.0	4.4%	844.4	5.3%	-20.2%
Other expenses, including:	3,302.1	21.4%	3 152.6	19.7%	+4.7%
agency fees	1,051.8	6.8%	1,190.5	7.4%	-11.7%
Software and databases	253.5	1.6%	240.2	1.5%	+5.5%
lease of premises	345.5	2.2%	361.6	2.3%	-4.4%
deductions to the universal service fund	220.3	1.4%	204.7	1.3%	+7.6%
TOTAL	15,440.0	100.0%	16,004.6	100.0%	-3.5%

Debt load

	1H 2010	1H 2009	Change
Long-term credits and loans	8,892.2	13,263.2	-33.0%
Short-term credits and loans	4,146.5	7,335.5	-43.5%
Total	13,038.7	20,598.7	-36.7%

Breakdown of investments

	1H 2010	1H 2009
Total amount of investments, RUR, mln	1,144.6	1,149.6
Traditional telephony	2.8%	3.7%
Value-added services, incl. cellular telephony	41.9%	39.4%
Datacom network and infrastructure	24.9%	46.1%
IT investments	22.1%	0.5%
Other, including	8.3%	10.3%
Construction and renovation of buildings and facilities	3.3%	5.2%

Recent news

02.08.2010 Uralsvyazinform releases H1 2010 financial results: net profit up 2.1 times

Press Release

02.08.2010
Uralsvyazinform releases H1 2010 financial results: net profit up 2.1 times