Recent news

07.08.2009
UTK announces H1 2009 financial results

Press release

Krasnodar, August 7, 2009: Southern Telecommunications Company (UTK) ») [(RTS: KUBN, KUBNP; МICEX: UTEL, UTELP; ADR OTC: STJSY, KUE FRA)], the largest fixed-line operator in the Southern Federal District of Russia, hereby presents its unaudited financial results for the first six months of 2009 in accordance with Russian Accounting Standards (RAS).

UTK’s revenue amounted to Rub 10,751.1 mln in the first half of 2009, which is 4.9% higher than in the year-earlier period. By contrast, expenses rose by only 1.8% to Rub 8,035.5 mln.

Revenue from local voice telephony increased by 1.2% to Rub 4,739.8 mln (45.8% in the company’s revenue breakdown), which is attributable to local voice tariff hikes effective March 1, 2009.

Revenue from intrazonal telephony decreased by 5.7% and amounted to Rub 1,725.3 mln (16.7% of the company’s revenue breakdown), which is due to a decrease in demand for calls between fixed-line network users and from fixed-line network users to mobile telephony subscribers.

As a result of an increase in the broadband access subscriber base, Internet revenue from datacom and ISP rose by 34.7% to Rub 2,632.8 mln in the first half of 2009. At the end of H1 2009 the share of this revenue in the company’s revenue breakdown increased by 5.6% to 25.4%.

Revenue from interconnect and traffic transmission decreased by 12.5% to Rub 988.9 mln (9.5% in the company’s revenue breakdown) as a result of structural changes in traffic and the cancellation in accordance with the legislative procedure of charges at interconnection points as of March 1, 2008.

Revenue breakdown

Indicator, Rub mln

H1 2009

H1 2008

Change, %

Revenue from core types of activity

10,751.1

10,247.8

4.9

incl. telecom revenue

10,356.3

9,846.5

5.2

Intrazonal telephony

1,725.3

1,830.3

-5.7

Local telephony

4,739.8

4,681.9

1.2

Cellular, wire broadcasting, television

180.4

163.3

10.5

Telegraphic, datacom and telematic services

2,714.0

2,031.6

33.6

incl. datacom and ISP

2,632.8

1,954.6

34.7

Interconnect and traffic transmission

988.9

1,130.3

-12.5

Other core services

8.0

9.0

-11.1

Outsourcing and agency fees

230.0

253.4

-9.2

Non-core services

164.7

148.0

11.3

Revenue breakdown, Rub, mln

H1 2009

H1 2008

Change, %

Intrazonal telephony

2,266.1

2,406.5

- 5.8

Local voice telephony

5,692.0

5,492.6

3.6

Cellular, wire broadcasting, television

370.2

337.9

9.6

Mobile (cellular) telephony

168.7

190.9

- 11.6

Telegraphic, datacom and telematic services

2,927.1

2,361.5

23.9

incl. datacom and ISP

2,860.9

2,289.3

25.0

Interconnect and traffic transmission

1,317.1

1,502.5

-12.3

Other core services

0.46

0.55

-16.2

Outsourcing and agency fees

254.8

276.2

-7.8

Non-core services

378.4

378.6

-0.1

Payroll expenses in the first six months of 2009 amounted to Rub 2,241 mln (27.9% of the company’s cost side), which is 7.2% less than in the same period a year ago.

The depreciation of fixed assets rose by 14.7% to Rub 1,995.1 mln (24.8% of the company’s cost side).

Material expenses decreased by 9.9% to Rub 768.7 mln (9.6% of the company’s cost side).

Interconnect expenses (including Rostelecom) increased by 7.9% and amounted to Rub 929.6 mln (11.6% of the company’s cost side).

Cost breakdown

Indicator, Rub mln

H1 2009

H1 2008

Change, %

Operating expenses

8,035.5

7,890.3

1.8

Payroll expenses

2,241.0

2,414.2

-7.2

Social insurance contributions

573.0

613.2

-6.6

Depreciation of fixed assets

1,995.1

1,739.5

14.7

Material expenses (total)

768.7

852.9

-9.9

Interconnect expenses (including Rostelecom)

929.6

861.3

7.9

Other

1,528.1

1,409.2

8.4

Despite the influence of the financial and economic crisis and the accrual in the first six months of 2009 of Rub 1,391.4 mln as negative foreign exchange rate differences, the company reported a positive financial result amounting to Rub 517.8 mln.

EBITDA remained virtually unchanged and stood at Rub 3,869 mln, while EBITDA margin decreased by 1.8% to 36%.

As a result of headcount optimization compared with the first six months of 2008 the company achieved a 5.2% reduction in the number of its employees down to

Recent news

07.08.2009 UTK announces H1 2009 financial results

07.08.2009
UTK announces H1 2009 financial results