VimpelCom Q2 Profits Up By 31% to $470 Million
Russia based VimpelCom has reported a 30.9% jump in its second quarter profit to US$470 million compared to a year ago - but down on the US$601 million reported in the first quarter of this year. Revenues rose by 52% to $2.61 billion, while operating income before depreciation and amortisation (OIBDA) increased by 36.3% to $1.22 billion.
The groups overall mobile subscriber base increased by 6.0 million versus 2Q2007, reaching 53.7 million.
Commenting, Alexander Izosimov, Chief Executive Officer of VimpelCom, said, "We are pleased with our robust second quarter results. The Company showed solid 52% annual revenue growth with a healthy 47% OIBDA margin, which is in line with our internal target for this stage of the integration of Golden Telecom. The increase in revenue was driven by fast organic growth in both our mobile and fixed-line operations as well as by the first full quarter consolidation of Golden Telecom.
"In the second quarter we successfully refinanced our short-term debt related to the Golden Telecom acquisition. Following the refinancing, we started to intensify our sales and marketing efforts in the Russian mobile segment, resulting in 11% quarter-on-quarter revenue growth in this segment.
"We are also very happy with our performance in the CIS, where we showed strong growth and increased revenue market share and ARPU in all geographies.
"We will continue to focus our efforts along three key priorities for the Company: developing integrated operations in Russia, including a strong push in the broadband business, continued development in the CIS markets and expansion outside of the CIS. These priorities prompted us to make some adjustments to our organizational structure which we believe will enhance the focus and efficiency of our business."
In Kazakhstan the company's efforts to strengthen the direct dealership network, improve service quality and maintain a conservative pricing policy resulted in 13.8% quarter-on-quarter revenue growth. ARPU grew by 6% compared to the first quarter, which is particularly encouraging in light of ongoing economic difficulties in the country.
The company grew its revenue market share ahead of the competition in Uzbekistan. Due to a conservative pricing policy and the focus on network and service quality VimpleCom says that it was the only operator in Uzbekistan that increased ARPU compared to the first quarter.
The improved quality of the Ukrainian subscriber base, coupled with a positive seasonal trend, helped us to grow ARPU through an increase in both usage and average price per minute. As a result, the company organically boosted mobile revenue by 26% compared to the first quarter and by 92% year-on-year. Additionally, consolidation of Golden Telecom led to total annual revenue growth of 199%.
VimpleCom introduced the Beeline brand in Armenia in April 2008. A strong marketing campaign, supported by improved execution in retail, resulted in a gain in revenue market share of almost one percentage point compared to the previous quarter.
Posted to the site on 28th August 2008