VimpelCom Announces Fourth Quarter and Audited Annual 2008 Financial and Operating Results
13 May 2009
Moscow and New York (May 13, 2009) - Open Joint Stock Company “Vimpel-Communications” (“VimpelCom” or the “Company”) (NYSE: VIP), the leading provider of telecommunications services in Russia and the Commonwealth of Independent States (CIS), today announced its fourth quarter and audited annual 2008 financial and operating results.
Full Year 2008 Financial and Operating Highlights
• Net operating revenues reached US $10,117 million, an increase of 41.1% versus 2007.
• OIBDA reached US $4,860 million, an increase of 35.1% versus 2007.
• Consolidated OIBDA margin was 48.0%, including 48.9% in Russia and 51.4% in Kazakhstan.
• Net income totaled US $524 million, a reduction of 64.2% versus 2007, reflecting strong adverse currency impact and charges related to impairment loss.
• Operating cash flow for the year amounted to US $3,422 million.
Fourth Quarter 2008 Financial and Operating Highlights
• Net operating revenues reached US $2,555 million, an increase of 27.1% versus 4Q07.
• OIBDA reached US $1,124 million, an increase of 22.4% versus 4Q07.
• Consolidated OIBDA margin was 44.0% including the fixed-line business.
• Net loss amounted to US $816 million, reflecting $1,012 million loss due to currency devaluation and US $443 million impairment loss.
• Mobile subscribers increased by 3.3 million versus 3Q08, reaching 61.0 million.
Commenting on today’s announcement, Boris Nemsic, Chief Executive Officer of VimpelCom, said, “2008 was an important year in the development of VimpelCom. We significantly expanded both the scale and scope of our business. Our consolidated revenues passed the US $10 billion mark and the consolidated OIBDA margin stayed close to 50%. Operating cash flow exceeded US $3.4 billion. The scale and scope of our business, good cash flow generation and a broad range of anti-crisis measures we have been implementing make us confident that VimpelCom will be able to get through the period of macroeconomic uncertainty and sustain its leadership position”.
In commenting on the announcement, Elena Shmatova, Chief Financial Officer of VimpelCom, said, “Considering the importance and scarcity of liquidity in the current market environment we continue to optimize our debt portfolio. The signing of loan agreements with Sberbank in March was one of the steps we are taking in this regard.”
The economic turmoil in the fourth quarter of 2008 marked the beginning of a different economic environment, which will test the robustness of the business. Our operations in Russia and the CIS showed resilience, delivering 41.1% growth in net operating revenues year-on-year, but more importantly maintaining local currency revenues in line with the previous quarter.
At the same time, in the first months of 2009, we see that the economic conditions in all our markets are deteriorating with a substantial drop in industrial production and growing unemployment. We anticipate that these developments could have a negative impact on the telecom sector. Therefore, while defending our market position, we continue to focus our efforts on cost reduction, operational excellence and effective cash management.
|
